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Network slicing represents a major innovation for mobile network platforms. For the business expansion beyond consumer mobile broadband for 4G and 5G. Up until now dominated by a “one slice fits all” model for unlimited data connectivity. And this post is about the role-tailored, optimized slices of network capacity and capabilities can play in the future when combined with business model innovations.

The one slice fits all market domination is coming to an end

The explosive growth of mobile broadband services, is a global success with few comparisons. A growth enabled by strong industry focus on simplicity. One type of device, one service and proven traffic-based business models. With plenty of customers to serve, this decade has been about maximizing smartphone penetration. With a universal offering.

The business focus on the flagship offerings has dwarfed the long tail of other opportunities. A tail where no individual use case can move revenue needles anywhere close to the flagship offering. And as a consequence, we have a long tail of un-, under- or over-served market opportunities. Requiring a different offering than the main stream one slice fits all approach.

Network slicing is about unlocking these use cases with tailored, optimized network slices. With business models that make business sense for both operators and industries. Representing opportunities with global sizes of 10k, 100k and 1Mn. Rather than billions of smartphone customers.

Continuing without network slicing limits the markets 4G and 5G can serve in the future

At the high end of market, business have seen building own networks as the only option. Where the one slice fits all offering was either capability or business model restricted. or not providing enough coverage. Driving dedicated wired or WiFi enabled networks even where mobile networks could have done a better job. Network slicing over 4G today and 5G tomorrow can change this in a material way.

Network slices will not replace all private networks. Nor do all wanting to build a private network have access to suitable spectrum. With the creation of network slices it will be more about choices. Between a slice or a private network build. Where borderlines and preferences between them will fluctuate. Rather than a single default alternative.

The creation of the network slice alternative involves:

  • The refined network requirements on use case or industry level.
  • The definition of the network capabilities required for each slice.
  • The network wide replication potential for successful slices.
  • Alternative business model to traffic-based tariffs.

All four are central to make the slice alternative attractive enough for operators and industries to pursue.

Elimination of obstacles from trials to deployment

Operators have evaluated network slicing through proof of concept trails and techno-economic studies. To pave the road for commercial deployments. A few insights stand out as critical for broader market adoption:

  • First there is a difference in the capabilities we have been able to test to date for 4G and the additions defined for 5G. And in the trade-off between do what you can with 4G today versus what you want with 5G tomorrow. Where a preference to learn from the current rather than plan and wait for the future rules.
  • Second, you want to look at the network slice challenge from an end-to-end perspective. Connecting radio and core networks and associated management systems. Rather than in domain specific silos. As we move from trials of individual core and radio capabilities, we need to bring it all together.
  • Third define a manageable portfolio of slices to start with. Focus on a few slices with a fast path to initial success. Where too many variants can stall progress in getting market acceptance.
  • Finally, consider business model innovation is an integrated part of the network slice development. In both directions. What are the network slices you want to sell, and which model will make you most successful. And which network slices would you want to buy from one or several network function vendors.

Want to know more about the practicalities of network slicing and automation and how to simplify operations with services, which are quick to provision, replicate, scale, upgrade and delete?

Download paper

If you missed, there is also an economic study of network slicing for IoT service deployment. It analyzes the economic benefits for network slicing and was done in partnership with UK operator BT. Read the Ericsson and BT study.

Thank you for reading this post.

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Peter Linder
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Peter Linder

Peter Linder is responsible for 5G Customer Engagement Marketing in Market Area North America for Ericsson. Peter have been 26 years with Ericsson, 15 years in various management position and the last 7 years in Dallas, TX, USA. His field of domain expertise is fixed and mobile broadband networks plus digital transformation for network operators. His experiences come from marketing, strategy, business development and portfolio management roles. Blended with a strong passion for mentoring about digital in digital form. Peter speak three languages, is a global citizen and frequent flyer. Peter holds a M.Sc. in Electrical Engineering and an MBA in International Business Management. Both from Chalmers University in Gothenburg, Sweden.