Operators could make billions from network slicing if interoperability prevails, claims report

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Network slicing could bag operators $6 billion in revenues through the creation of new services but only if interoperability is central, a new report has claimed.

ABI Research said slicing, which is seen as a crucial part of 5G, affords operators the opportunity to identify new markets and offer enterprises new services and personalised networks. It will also help operators create differentiated solutions and simplify the operations of enterprises, it added.

Don Alusha, Senior Analyst at ABI Research, said: “Network slicing revenues will eventually be on an upward trajectory, driven by digital, cloud, and security requirements of multiple industry verticals, particularly for the trio of manufacturing, logistics, and automotive.

"Realising the full revenue potential is dependent on essential slicing infrastructure from vendors, and pertinent applications delivered by MSPs [managed services providers].”

Alusha cited BT and Swisscom as two operators who stand out for their work in network slicing. BT is chairing a group exploring the technology as part of the Facebook-led Telecoms Infrastructure project. The Swiss operator worked with Ericsson earlier this year to show how network slicing could help critical communications.

Telenor, Telefónica and Orange Poland have recently revealed their own trials of the technology.

However, Alusha warned that despite the work to enable best practices for network slicing, further needs to be done to ensure the harmonisation required for end to end implementation.

He said: “MSPs and vendors are pursuing different models of collaboration with vertical markets and growth for each market will be driven by premium services, revenue potential and ability to address existing challenges in the short and medium term.

“Vendors should aim to eliminate complexity through automation and ‘deep’ orchestration, a feat that calls for close collaboration with standard bodies to standardise and achieve alignment apt for commercial deployments and ecosystem integration.”