5G will be the catalyst for the revival of the platform business model. With the arrival of affordable 5G smartphones, and the almost certain launch of Apple's 5G later in the year, all pieces of the 5G-enhanced mobile broadband (eMBB) puzzle will fall into place, but the full picture is not one that will flatter communications service providers (CSPs). Most telecom operators are on the trajectory to becoming utility-like network providers of connectivity. 5G will eventually intensify an old issue: the cost of providing connectivity increasing as data traffic continues to rise (unlimited data and mega bundles), but the revenues from connectivity have a natural ceiling and are not growing.
Over the years, CSPs have introduced several home-grown services, as well as bundled services from third parties, to offer services beyond connectivity, but in 2020 CSPs will take a significant step forward and move ahead from the aggregator model into something that can be qualified as the platform business model.
Going back to basics, CPS will re-evaluate the benefits of becoming a connecting platform for two groups: consumers and producers. CSPs will have to work hard on both fronts, giving consumers the best-curated experiences for things and services they care about, while helping producers to understand and reach these paying customers, ideally with a subscription to services.
Many service categories are suitable for a platform business model, including gaming, entertainment, music, security, smart-home, OTT, financial and insurance services, healthcare, and many other services for individuals, households, and enterprises.
The challenge for CSPs will be to work on both sides: understanding consumers, analyzing their behaviors, preferences, and willingness to spend, preserving their privacy and being a trusted adviser while facilitating transactions with producers. On the other hand, CSPs need to demonstrate to producers that they hold a relationship with a captive audience of buyers, and that working with a CSP can be more beneficial than going direct-to-consumer. Both challenges seem impossible for many, but some CSPs have a legitimate platform role to play, and these will not be shy to say so at Mobile World Congress 2020.