GSMA hosted its MWC event for North America in Los Angeles last week. As expected, a lot of focus was on 5G, what it means to the larger ecosystem, the applications and services that will justify the investments, the competition, the regulatory frameworks necessary for the next decade, and much more. We were involved in several conversations with industry CXOs both on-stage and off-stage. This note summarizes our observations from the show.

• Five years ago, we wrote a paper on the emergence of Connected Intelligence. We can start to see some of the pieces together now. The expected trajectories of computing and communications segments of the economy are converging and colliding.
• Communications industry thinks it is the platform (5G) and compute is an app. Computing industry thinks that compute is the platform and comms is an app. Clearly the two worldviews will lead different strategies and jostling in the ecosystem, but it will also yield some interesting partnerships and collaborations like Nvidia and Ericsson joining forces to create a vRAN layer on Nvidia’s EGX (Edge Supercomputing Platform) architecture. The advantage of such an approach is obvious – one can run a number of high-fidelity applications on the same hardware and more importantly exchange datasets in real-time which could lead new classes of applications and services.
• VMWare had strong presence at the show driving the discussions around the Telco Cloud. The computing industry uses centralized cloud and edge interchangeably and would like to drive the value less to the nodes and more to the orchestration layer. Comms industry views Edge as a potentially new opportunities that cloud players will have to work with the service providers to build the edge network. It will be a fascinating journey.
• 5G was clearly the talk of the show and what it could enable for other industries. However, the growth in the US market remains relatively unspectacular which is not a surprise but if we had to measure the reality against the media blitz, one might think the number of subs are growing by leaps and bounds whereas, in reality, things will start to heat up only in 2020.
• IoT seems to be making a resurgence after slow growth over the last decade (again relatively speaking against the expectations). Ericsson is quite bullish on its prospects. AT&T has been the leader amongst the operators, and we are laying the groundwork for the next decade.
• Edge continues to be an area that is both reminiscent of the gold rush, yet a confused state of concepts and narratives exist reminding us of the Indian fable, “Elephant and the blind men.” This means there is a lot of work to be done to provide clarity on Edge and its implications.
• The decision of T-Mobile and Sprint merger hung over the show though not actively discussed beyond the murmurs of the hallway cacophonies. We will have more commentary in our upcoming US market quarterly update for Q3 next month.
• Privacy and security issues were discussed and debated though industry seems to be at a loss of how to tackle them more proactively in absence of any regulatory leadership.
• Since we articulated the 4^th Wave thesis back in 2012, there has been a search for new revenue streams for the operators. How 5G will change things is a subject of intense speculation. There seems to be consensus developing that we first discussed in our 2015 5G Economics paper that access is unlikely to be the savior for 5G. Investments in services have to be made however, more importantly, if one doesn’t fix the problems that led to the decline in 4G revenues, 5G isn’t going to fix them for the operators. Operators need a strategic reset and their current boards have been grappling with this question for some time. It is clear, new leadership is needed at the board level at many of the operators to guide them through the tumultuous 5G era.
• As we argued in our most recent paper, “Policy, Geo-Politics, and the Growth of Technology in the Connected Intelligence Era,” the role of geo-politics was considered one of the biggest risks to the growth of the industry. The global wireless industry has to resolve the Huawei question. It is unlikely that the Chinese infra players will be allowed to operate in the US in any meaningful way. However, Huawei doesn’t need US to be successful. It already has Europe in its back pocket and with China being one of the rocketship 5G market, it is well set for the 2020s. The main threat Huawei has is on the handsets. Without Android, it lacks the punch. In the worst-case scenario, its market outside China could collapse dramatically. At best, there could be a compromise that allows them to access the Android ecosystem. The tussle points to the desperate need of new frameworks to deal with such security and technology issues at the UN level. We need new operating principles or else the risk of geo-politics will always hang on its head like the sword of Damocles.
• DSS or Dynamic Spectrum Sharing is gearing up to be the workhorse of the 5G transition. It enables operators to roll out 5G without waiting for the 5G spectrum auction. Expect all major operators to talk about DSS more and more.
• 5G Private networks were discussed often both on and off the stage. There are several use cases emerging in different verticals which might see some traction in 2020.
• One of my favorite session was the DARPA spectrum challenge – rather than just relying on FCC to clear up spectrum, new techniques to share spectrum is the way to go and am glad DARPA is taking the lead to show some leadership in this area.
• US DoD also got into the action with its 5G plans and aspirations.
• Rural operators are not standing behind but looking at 5G to extend broadband coverage to the remote parts of the country.
• Sprint probably had the most compelling 5G VR demo highlighting the role VR can play in education, information consumption and collaboration.
• Are Altiostar, Mavenir, and Rakuten the future of the industry? Plenty of debate on the subject.