Omdia’s View
Innovative pricing and applications are key factors in helping operators maintain 5G mobile service revenue momentum. Of the 30 operators tracked by Omdia, 19 saw mobile service revenue growth of less than 5%.
Mature 5G markets with 5G penetration rates of more than 50%, such as China, Japan, and South Korea, are expected to face low growth. The harsh reality is that markets with lower 5G penetration rates (around 20–40%) face low revenue growth of less than 2–2.5%. This is currently the case in Canada, France, Saudi Arabia, and the United States. This level of 5G penetration does not guarantee strong 5G customer growth, which puts a huge burden on operators: most operators now need to think “what else can I do besides offering more expensive plans with more data?” to avoid premature stagnation.
To promote upsell (not just 4G users upgrading, but also existing 5G customers buying more services) and avoid customers who are reluctant to buy new phones for 5G due to cost of living pressures, operators should focus on pricing and application innovation.
Mainland China and Hong Kong have mature 5G markets, so they have taken the lead in solving this dilemma. Operators have launched uplink data priority services for outdoor live broadcasts (such as video bloggers who need to upload videos to social media quickly).
Thailand, an emerging market, has also seen notable innovations, with AIS launching uplink priority services for internet celebrities and concertgoers, low-latency data packages for gamers, and speed-boosting services for general consumers.
Key Information
Operators launch all-in-one add-on packages. The Living Network add-on package from AIS Thailand includes three modes (uplink priority, speed increase, and low latency priority), which is the first time an operator has offered an all-in-one add-on package. Omdia believes that guaranteeing low latency is a market priority strategy. Living Network is a good start: if operators want consumers to pay more for QoS and speed increase, then showing real-time network performance graphs for gaming and video playback, or even service performance indicators, is essential.
Uplink QoS continues to gain momentum.
Telecom operator HKT recently launched a video uplink traffic VIP service for social media user-generated content. HKT users can first purchase a mid-range 5G package for daily voice and data communications, and then purchase 40GB of priority uplink quota per month. The operator has been one step ahead of other telecom operators in terms of business model, providing various devices such as GoPro suitable for user-generated content creators. There are other ways to market uplink QoS, such as China Unicom providing a large amount of data quota in one package, which can be used for VIP uplink data as well as normal data.
Personalized service is back in fashion.
Premium brands and exclusive loyalty services include personal assistants, dedicated retail channels, travel insurance and discounts, nutritionist consultations, airport lounge access, and even a consumer-specific account manager.
Personalized services will require investment..
Offering packages and exclusive services to premium customers will require additional investment or a reprioritization of current investments. This may require significant capital, especially considering investments in exclusive retail channels for premium customers and/or exclusive concierge services such as customer service specialists. However, telecom operators cannot overspend. Operators that already have mature and rich loyalty programs will be able to reap returns by investing in premium packages for wealthy customers or niche consumers (gamers).个性化服务将需要合作。
High-end loyalty incentives that cover more benefits beyond connectivity will require telecom operators to work extensively, including establishing new partnerships with insurers, hotels, and smart lock companies.
