2021 Telecom & Media Conference: Long-term enterprise 5G opportunities in wireless

At our annual Telecom & Media Conference, we brought together major communication companies, including Canada's big three – BCE, Rogers and TELUS – to discuss a variety of topics including the impact of the ongoing 5G revolution.

"The goal of hosting our annual Telecom & Media conference is to provide a forum, this year virtual, for our issuing clients to connect directly and in a targeted and informing way, with existing and potential investors" says Jeremy Walker, Deputy Chair and Global Head of Communications, Media & Technology, Investment Banking. "The virtual format has made the conference more accessible, broadening its reach and effectiveness."

Here are some highlights from the conference:

Participants discussed that Canadian wireless carriers are currently in the middle of a large-scale upgrade from 4G to 5G networks. In addition to faster data speeds (over 1 Gbps), lower latency (response times under 10 milliseconds), and increased capacity (approximately 10x more data traffic per unit of spectrum than current 4G/LTE networks), these new 5G networks are expected to facilitate a lot of new use cases and business opportunities from enterprise clients, including:

"While still in its infancy, the evolution to 5G is opening up new revenue streams for carriers across private networks, MEC, enterprise solutions and data security and analytics", says Rod Davies, Managing Director and Head of Canadian Communications, Media and Technology, Investment Banking. "To capitalize on these opportunities, carriers are making generational investments in fibre and wireless networks and capabilities, positioning themselves to be digital transformation partners."

Deployment of greater 5G capabilities also supports improvement of fixed wireless access (FWA) services. FWA provides home internet services over the wireless spectrum and is more suitable for rural markets where deploying fibre is challenging. These services are already offered using the current spectrum available. The increase in capacity when upgrading networks to 5G will provide rural markets with much more improved internet quality.

One of the more consistent threads from the participants was the idea that all wireless carriers should have the potential to provide network access as a service (also known as NaaS) for 5G application providers. In the 4G world, wireless carriers got paid for data tonnage over their networks. However, most of the shareholder value created accrued to application providers, such as Netflix and Uber. Currently, it appears most wireless carriers seem satisfied with partnerships with technology companies and only partial retention of the incremental revenue.

Going forward, it seems that the wireless industry is being much more proactive and strategic in 5G than it was in 4G, so that the carriers can share in the upside from new applications and services that make use of the faster, lower latency network. Various partnerships between carriers and cloud hyper-scalers have already been announced, but the contract terms and revenue sharing agreements remain unknown.