The pandemic has prompted a global surge in demand for data, with video-grade networks required now for entertainment as well as basic communication with those we’ve been unable to see in person. Operator groups were already on this journey, but have been forced to accelerate their strategies to meet this demand.
We spoke to Ooredoo Group’s Chief Technology Officer Nigel Byrne to discuss how the emerging markets-focused player has enacted digital transformation and prepared for a 5G future.
What is the state of play with 4G deployment for Ooredoo? Is widespread 4G now a requirement before 5G can be deployed?
There are ten countries within the footprint, and as of today nine are live with 4G. In a majority of cases, this is a substantial area similar to the 2G or 3G footprint; the one exception is Palestine, which is a unique case. Iraq was the latest one to launch; we were waiting for the regulatory go-ahead and spectrum permits which got sorted earlier this year.
Today, it’s impossible to have a 5G network without 4G in a non-standalone setup; simply put, the 5G network can carry a large volume of data, but all the signalling and everything else is still on the 4G part. If you lost the 4G, the 5G would disappear too – the workings of the non-standalone network means the two are completely linked. In the next generation, it will be possible to have a discreet standalone 5G network end-to-end, but the problem then will be that the 5G coverage will take a long time to catch up with 4G – particularly because of the spectrum that is being used. There’s a lot of C-band or 3.5GHz spectrum being rolled out; the site coverage is going to be so much less than 4G, so these are going to coexist for a long time.
With the different layers – 2G, 3G, 4G, 5G – what we’re doing in effect is squeezing the 3G layer and refarming all the spectrum to 4G as it’s a much more efficient use of the assets, allowing much more data to be sent through the network. In most of our markets, the 4G device penetration is rapidly growing; the price point of those devices has gone down so much that decent phones are now around $20-$30, making them accessible to emerging markets like never before.
Device affordability was a major challenge with 4G adoption – are we likely to see a repeat of this issue with 5G?
If you look at the price of 5G devices today, it’s huge – and the problem is that the silicon technology to achieve that massive throughput is expensive. It’s going to be a barrier to low-cost devices for some time, which is why I think particularly emerging markets will be using 4G for a long time to come. I’m not sure that the 5G device prices will fall in the same way that they did for 4G – just looking at the technology that’s needed to support multi-MIMO on the device side, it’s going to take time before mass market adoption is possible. It’s achievable but it could easily take five years or so.
There’s probably a difference here around our footprint too. Everyone is building high-capacity data networks now, but it’s not just data networks – it’s video grade networks, because this is now what people consume on whatever device they’re using. If you’ve got hold of the spectrum, it’s not so difficult to build a radio site – the key challenge is backhaul, and that of course means fibre. If you compare a market like North Africa compared with somewhere like Indonesia in Southeast Asia, the fibre that’s been put into the ground in the latter is impressive – there’s an ongoing effort to get fibre delivered to sites to make them future-proof for massive capacity. In a market like Algeria or Tunisia, the incumbent players in those markets – i.e. the government-owned entities – have large fibre networks, but as a challenger, rolling out fibre to a lot of sites is difficult in terms of the business case. We look more towards making this viable in terms of cost-sharing and partnerships but it’s a lot further behind in North Africa than somewhere like Southeast Asia. A lot of this is on the macroeconomic side; Indonesia is seen by a lot of investors as a huge future growth market, so people are willing to invest in infrastructure businesses.
In terms of digital transformation, what trends are you seeing and what are the benefits being delivered?
When the Covid-19 pandemic hit, we were lucky in that we’d prepared the underlying infrastructure – the data networks we needed, the multi-channel experiences to support the customers in our countries – over the past five years or so. On many of our networks, we’ve been carrying as much as 70-80% more traffic across the past year as our customers have been working from home, and we’ve been able to do this without degrading the network experience. At the same time, we’ve moved from face-to-face retail channels to customer engagement via apps. While we had all the basic ingredients in place, we’ve of course learnt a lot over the past year and had to adapt how we do things, but this has accelerated a journey we were already on. A big part of this digital journey has been seeing our teams go from working together in an office to collaborating around the world; it’s been brilliant in terms of both how quickly we could get the IT working to enable it, but also how people were able to excel over the past year by being liberated from the traditional office structure.
And on the consumer side of things?
More and more, I think people want to be independent in how they buy and manage their services – they want an app that’s easy to use. The migration towards digital retail is apparent, with the ultimate aim of engaging with people directly via our digital channels. We’re aware that there’s a demographic who are keen to engage via – for example – SMS, but these exist alongside 5G users who want to engage through an end-to-end channel accessible on their device.
We’re refreshing our mobile financial services, which has become a major part of our ecosystem particularly in emerging markets. Markets such as Iraq and Algeria have very undersubscribed and even unstable banking systems, so we would be seen in these markets as a strong, respected brand which helps us move from more traditional telco offerings into some adjacencies such as MFS. We’re looking at this across all our markets; sometimes this requires local partnerships as you’ve got the financial regulatory bodies involved.
Customers need – and demand – video-grade networks, so the big challenge in developing markets is finding the right balance in investment. Developing markets are not far behind more developed markets, and we’ve actually often spent a lot more than our European counterparts on our networks – we haven’t been afraid to invest, even if this means accepting that we’re not at the bleeding edge as this often involves a cost that doesn’t make sense, but we’re never too far behind. Our adoption of technologies early in the cycle gives our customers access to great services really early.
In Myanmar for example, seven or eight years ago there was nothing, and they’ve basically skipped voice so there’s a generation of people now for whom smartphones are the first device they’ve ever used. We’re investing long-term in our countries to be a partner in aiding their development and creating sustainable long-term business – but this requires the building blocks of video-grade networks.
