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A business case for 5G mobile broadband in a dense urban area

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  • Rendon Schneir, Juan
  • Ajibulu, Ade
  • Konstantinou, Konstantinos
  • Bradford, Julie
  • Zimmermann, Gerd
  • Droste, Heinz
  • Canto, Rafael

Abstract

5G networks are envisioned to provide consumers and industry with improved transmission performance and advanced communication possibilities. To deliver on this promise of ushering in faster downloads and lower latency, mobile network operators are called upon for substantial investment in network infrastructure. Investors and operators need a clear 5G business case before making such investment. So far, very little research has been published on the topic of the 5G business case. This article studies the impact of different elements driving the business case of a 5G network. The study was performed within 3 boroughs of central London, UK, for the period 2020–2030. 5G-related costs and revenues were calculated to derive the business case. The results show that the business case for a 5G network providing mobile broadband services alone is positive over the time period 2020–2030 but has some risk in the later years of this time period. The business case is also particularly sensitive to assumptions on the revenue uplift and the rate of traffic growth which are inherently challenging to forecast. The sensitivity analysis shows that the return on investment becomes negative if both traffic and costs are significantly higher and revenues increase more slowly than our baseline forecasts. Network sharing helps to substantially improve the business case. Further research is needed to understand the business case on a regional or nationwide basis, and for a network that provides additional services beyond broadband.

Suggested Citation

  • Rendon Schneir, Juan & Ajibulu, Ade & Konstantinou, Konstantinos & Bradford, Julie & Zimmermann, Gerd & Droste, Heinz & Canto, Rafael, 2019. "A business case for 5G mobile broadband in a dense urban area," Telecommunications Policy, Elsevier, vol. 43(7), pages 1-1.
    • Handle: RePEc:eee:telpol:v:43:y:2019:i:7:3
    DOI: 10.1016/j.telpol.2019.03.002
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    References listed on IDEAS

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    1. Oughton, Edward J. & Frias, Zoraida, 2018. "The cost, coverage and rollout implications of 5G infrastructure in Britain," Telecommunications Policy, Elsevier, vol. 42(8), pages 636-652.
    2. Schneir, Juan Rendon & Konstantinou, Kostas & Bradford, Julie & Zimmermann, Gerd & Droste, Heinz & Canto, Rafael & Ajibulu, Ade, 2017. "Cost Analysis of a 5G Network with Multi-Tenancy Options," 28th European Regional ITS Conference, Passau 2017 169495, International Telecommunications Society (ITS).
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    Cited by:

    1. Oughton, Edward J. & Comini, Niccolò & Foster, Vivien & Hall, Jim W., 2022. "Policy choices can help keep 4G and 5G universal broadband affordable," Technological Forecasting and Social Change, Elsevier, vol. 176(C).
    2. Hoeschele, Thomas & Dietzel, Christoph & Kopp, Daniel & Fitzek, Frank H.P. & Reisslein, Martin, 2021. "Importance of Internet Exchange Point (IXP) infrastructure for 5G: Estimating the impact of 5G use cases," Telecommunications Policy, Elsevier, vol. 45(3).
    3. Edward J. Oughton & William Lehr, 2022. "Surveying 5G Techno-Economic Research to Inform the Evaluation of 6G Wireless Technologies," Papers 2201.02272, arXiv.org, revised Jan 2022.
    4. Gaoyong Li & Xin Zhang & Ge Zhang, 2022. "How the 5G Enabled the COVID-19 Pandemic Prevention and Control: Materiality, Affordance, and (De-)Spatialization," IJERPH, MDPI, vol. 19(15), pages 1-22, July.
    5. Gaspare D’Amico & Roberta Arbolino & Lei Shi & Tan Yigitcanlar & Giuseppe Ioppolo, 2021. "Digital Technologies for Urban Metabolism Efficiency: Lessons from Urban Agenda Partnership on Circular Economy," Sustainability, MDPI, vol. 13(11), pages 1-23, May.
    6. Benseny, Jaume & Lahteenmaki, Jarno & Toyli, Juuso & Hammainen, Heikki, 2023. "Urban wireless traffic evolution: The role of new devices and the effect of policy," Telecommunications Policy, Elsevier, vol. 47(7).
    7. Oughton, Edward J. & Lehr, William & Katsaros, Konstantinos & Selinis, Ioannis & Bubley, Dean & Kusuma, Julius, 2021. "Revisiting Wireless Internet Connectivity: 5G vs Wi-Fi 6," Telecommunications Policy, Elsevier, vol. 45(5).
    8. Jaume Benseny & Jarno Lahteenmaki & Juuso Toyli & Heikki Hammainen, 2023. "Urban wireless traffic evolution: the role of new devices and the effect of policy," Papers 2310.14406, arXiv.org.
    9. Ahokangas, Petri & Matinmikko-Blue, Marja & Yrjölä, Seppo & Hämmäinen, Heikki, 2021. "Platform configurations for local and private 5G networks in complex industrial multi-stakeholder ecosystems," Telecommunications Policy, Elsevier, vol. 45(5).
    10. Queder, Fabian & Lehr, William & Haucap, Justus, 2020. "5G and Mobile Broadband Disruption," ITS Conference, Online Event 2020 224872, International Telecommunications Society (ITS).
    11. Sahebali, M.W.W. & Sadowski, Bert M. & Nomaler, O. & Brennenraedts, R., 2021. "Rolling out of fibre optic networks in intermediate versus urban areas: An exploratory spatial analysis in the Netherlands," Telecommunications Policy, Elsevier, vol. 45(5).

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