Who Wins 5G, and Why?

A dominant or at least quite prevalent line of thinking these days (not the least because some business interests gain from such thinking) is that whoever gets to 5G first, in terms of coverage, “wins” the race to wring advantage from 5G.

While 5G coverage is necessary, it is not sufficient to wring huge financial or economic benefits from the new network. The reason for that thought is what happened in the 4G era, when one might similarly have argued that early deployment would lead to economic benefits associated with leadership in a “growing or leading” part of technology and economic life.

So here’s the argument, in a nutshell: the real upside in the 4G ear came from application providers, not access providers. Sure, the networks had to be there, but the incremental value and growth came from ability to create compelling, widely-used applications.

And that was not a direct result of having deployed 4G networks. Instead, the advantages flowed to places where app creation skills and capabilities were more advanced. Europe did not “fall behind” because it did not deploy 4G; it “fell behind” because its app-creation industries were not as well placed.

And that is why China and the United States generally are considered the key areas where new innovations might come in the 5G era. But it has nothing to so with deploying the access networks, in a direct sense. It has to do with the ability to conceive and commercialize new apps and use cases that take advantage of 5G network attributes (along with the other changes in networks that come with 5G).