Is the regulation driver or stonewall for the 5G business revolution?

A lot of challenges have been borne by the continuous regulative changes. The global political situation has been unpredictable when new trade barriers have been set due to appealing for national security reasons. Heidi M-B Lund (in National Board of Trade Sweden) raised the question “Will cybersecurity regulation become the greatest trade barrier ever?” and answered by herself doing very interesting research on the matter being found on the Report: “The Cyber Effect; The Implications of IT security Regulation on International Trade” (Kommerskollegium, 2018). 

In EU the trade barriers have become reality related to 5G telecom networks. EU has taken security related aspect very seriously and build total 5G Toolbox to be complied by all member states. Some member states have interpreted cybersecurity matters into national security landscape by out-listed non-European vendors. Some countries have set even some additional factual action by an example of out-listing Chinese technology off the telecom grids totally.

The biggest three 5G radio network suppliers are coming from Huawei, China, Ericsson, Sweden and Nokia, Finland. Naturally those markets are under special radar as well where two EU member states have taken very different approaches.

The Swedish government has officially  rejected Chinese 5G radio network manufacturers Huawei and ZTE. This has escalated well around the Chinese government by setting Ericsson as target for Chinese retaliation. That may lead to one global showcase, but that play is not going to scale across the EU and likely to be solved in time.

However, the highest trade barriers are still built by the national regulation by forcing industrial compliance to become accepted on the markets. Managing global standards, requirements of certifications and the most complying national level legislation will be the most essential business factor to be successful in the global digital market in the future.

Finland has been a front-runner adapting EU regulative acts being called as “model student” of the EU. Finland made adaptation of GDPR among the first ones and Finland has been among of the first countries implementing the 5G Toolbox into national legal framework. The 5G Toolbox came into force on 1st of January 2021 in Finland. 

Finland has a trillion dollar change! 

Finland is a front-runner by setting a legal framework for 5G in place. Finnish government has also sold 5G licenses via auction and the price was a reasonable 7 million euros for each operator. We have all necessary building blocks existing to move forward for 5G implementations.

Fifth generation mobile networks provide new opportunities for business unlike any other sector would in current digitalization waves. From a business point of view, it sounds like an easy way to boost growth. 

Why is investment for 5G moving forward very slowly? I believe that the mistake was made already a while ago. Widely visual marketing of 5G started a long time ago. There were a lot of expectations on 5th generation mobility built by manufacturers and market analysts. It started too early, long before even the first commercial 5G phones were available. Chicken and Egg dilemma was in place, no phones, and no network, at same time 5G tremendous business expectations deluged on business reviews. This caused a typical credibility issue, how to grip on the technology that is not ready and available. The momentum was lost, and meanwhile 5G phones started to come on markets and several countries released 5G network licenses and teleoperators have started to build networks. 

Now, after a few years the world looks different. The 5G world is getting ready step by step but hype is gone. Today’s strongest marketing campaigns are focused on consumers, more speed, real time gaming and higher resolution videos. It is true that 5G brings more possibilities for consumers, but revolution for consumers’ mobility was achieved already in 4th generation networks. 5G subscription is not building large business expectations with consumer applications, it is in business applications. 5G is meant to revolutionize the new era with industrial mobility. In the media we can read the same consumer stories about mobility that we already had with 4G, but more concerns with radiation and how mobility maybe connected to all types of health risks.

What is the reality now? Is 5G ready for business, is it available to real business applications? Yes and no, again, by exaggerating expectations, we only could fail. At the moment hundreds of serious technology vendors are developing technology to be available for all types of industrial use cases being adaptable for 5G. Most applications are still first versions to be taken in use but understanding that technology is still under significant development phases, and continuous development and testing must be carried out before getting full scale benefits out. 

Is it really the correct timing to start building a business to rely on 5G? This is again a tricky matter, and it really depends on the maturity of the legal frame in each country, as well as what business cases to be adapted in. Many countries are still in the planning stage to start auctions for 5G telecom licenses, and legislation not issued. However, several countries have already solved being ahead, like Finland, being ready to move forward as long as business takes into account compliance of regulation. Besides the compliance legal frame, investments should be made with compliance of trusted technologies. Trust is a big word, which contains a lot of variables. Technology must comply with the legal frame, industry related specifications, reasonable transparency and it must have continuity with process to comply with all those areas in the future when new versions of firmware are released or tested. If business is considered, the 5G ecosystem is more complex than any previous telecommunication infrastructures have been. These concerns may work against though to step forward in utilizing 5G industrially. Yes, it would demand some additional efforts in the start, but also being early, allows significant benefits for the business in future. 5G requires new thinking, learning by doing, there is no ready-made success prescription, it is overall business adaptation that every organization must go through by themselves. For that road, the only way is to take one step at the time, like it has been transformation from traditional IT servers from offices to wide scale cloud services.