Herbert Blum: Why the 5G Pessimists Are Wrong

Mobile 5G technology promises exciting new capabilities, but many executives are skeptical of its business case. Herbert Blum, who leads Bain's global Telecommunications practice, discusses why network operators that fail to move early on 5G run the risk of being left behind.

Read the Bain Brief: Why the 5G Pessimists Are Wrong

Read the transcript below.

HERBERT BLUM: We at Bain & Company are very excited about the advent of 5G. The new capabilities that this technology promises to bring to the table, they are not only about faster speeds, but they're also about new kinds of capabilities that will allow existing use cases, but also new use cases, to emerge and be offered to end customers, both on the enterprise as well as on the consumer side.

Yet interestingly, when we, in working with carriers around the globe, and also scanning what they publicly state, one cannot help [noticing] that actually the majority of these executives express a sense of pessimism about 5G. That pessimism is rooted in several elements, one of which is they can't clearly identify that specific killer use case today.

Well, we are actually much more optimistic about that view. Just because we can't clearly identify it yet doesn't mean that an entrepreneur is [not] already working on the next idea that will take its time before it actually shows up on the scene. We should remind ourselves that the iPhone has been on the scene only for a decade, or a successful business model like Uber, founded in 2009, rose to prominence only over the last few years.

And so we should make sure that we don't fall into the trap, by not being able to identify ahead of time what this killer use case is going to be, what that next great business model is going to be, that therefore 5G will not bring great things. There's already an entrepreneur out there that is already thinking about an idea of how these new capabilities of 5G, such as hyperaccurate GPS, how superlow latency connections between the network and the end device, how those will enable the new capabilities and new value propositions for which enterprise CTIOs and end consumers will be willing to sign up with a carrier in order to have access to these network services.

Read the Bain Brief

Why the 5G Pessimists Are Wrong

Network operators that listen to the naysayers run the risk of missing out on the true benefits of this step-change technology.