Ironically, patience is a virtue with regard to Ultra-Reliable Low-Latency Communications (URLLC). The applications are clear, but it will take some time for service providers to catch up to the demand, according to experts.
Low Latency as a Business Case
“There’s been a lot of discussion and even hype around URLLC in the run-up to commercial 5G and the latest release of [3rd Generation Partnership Project; 3GPP] standards includes many of the necessary specs to enable sub-millisecond latency,” said Caroline Gabriel, Research Director of Rethink Technology Research, speaking with regard to Release 16 during a webinar entitled Understanding Low Latency 5G Use Cases, hosted by The Mobile Network.
Gabriel was presenting the findings of a Rethink paper commissioned by network-solutions-provider AccelerComm entitled “Is ultra-low latency critical to the 5G business case?” She listed areas of interest for the technology. On the consumer side, use cases revolve around augmented reality (AR), virtual reality (VR) and cloud gaming. On the enterprise side, they include sectors like public safety (for applications like image recognition), transportation (vehicle-to-everything communications and intelligent transport systems), and manufacturing (AR support and digital twins).
“Lots of discussion about these and their requirement for very low latency is very clear. So, of course they’re important, but for most operators they will not make a strong enough business case in their own right,” she said. “For example, public safety contracts are few in number, although they are high-value and they come with very demanding [Service Level Agreements] that not all operators can take on, but there are many other areas of demand.”
Gabriel went on to argue that new URLLC-centric revenue streams are certainly beneficial. However, because the streams are not enough all by themselves, the operators that Rethink surveyed are looking to leverage and deploy URLLC across their respective networks for an overall competitive advantage as a result.
“Once you’ve identified the leading use cases that can almost by themselves justify the investment into low latency, then of course the benefits start to accumulate because, having deployed that very high-quality network, operators can then start to push out that level of response and quality of experience to applications and uses that don’t necessarily require it, but will notice that they’re getting a very enhanced user experience,” she said. “So, we do think there is a trickle-down effect in ROI with ultra-low latency.”
The Wait for Low Latency
Juniper Research reported a similar story in a recent study of theirs. The analyst house found operator-billed revenue from 5G connections will hit $357 billion by 2025 (from $5 billion in 2020), with premium pricing applied to help secure ROI on services dependent on URLLC (or network slicing). Joe Madden, President of Mobile Experts, agreed with the overall assessment in an interview with 6GWorld™.
“The growth of 5G revenue is going to happen. I think hundreds of billions of dollars in 2025 is a reasonable estimate,” he said. “However, most of that is going to be broadband, just simple mobile broadband subscriptions like we have in 4G today.
“The low-latency, high-reliability 5G [Internet of Things] applications for robotics and various things like this are coming. I see the development of those things under way, but it’s a little slow coming to market and we have a couple of releases still coming in 3GPP standards to get Release 16 products on the market, then update those with Release 17 features to really make [URLLC] possible. “
Madden conveyed his belief that the time in between now and 2025 will more likely be spent on the build-up of other aspects of the ecosystem. They include “maturing the edge-computing stack and software that goes on top of the 5G to 6G network,” so that apps can be developed for enterprise use.
Monetising Low Latency
Nevertheless, initial steps are being taken to monetise URLLC. Various operators are experimenting with low-latency offerings. For example, Verizon is leveraging its 5G Multi-Access Edge Computing platform through a partnership with Amazon Web Services (AWS).
Madden said the partnership and others like it make sense, because it’s exceedingly difficult for operators to put up their own cloud and “reinvent what AWS has done.” In his mind, while business models have yet to be clearly defined in this space, each partnership would feature revenue sharing, with the percentage division being dependent on the sector in question.
“In our research, we’ve actually taken the market, broken it in eight different vertical sectors, with different business models in each sector and different revenue share in each sector, so that we could make predictions about how much revenue the telcos are going to get and how much the cloud guys are going to get,” he said.
“If you’re looking at industrial sectors, I think yes, latency is very important. Expected revenue [from low-latency services] is nowhere near as much as [revenue from consumers] is right now, but that will come over time.”
Madden outlined a few of those vertical sectors; According to him, reliability of connection and latency are important to drones. Secure connections and latency are meanwhile critical to automotive. From a manufacturing perspective, latency is key as well, but so is on-premises control of data.
For its part, Rethink outlined four verticals in which URLLC was considered most important: public safety, transport, manufacturing, and healthcare. So, the demand is there, with non-critical sectors like sports also showing near-term interest (by 2022) in at least sub-5ms latency. While there are inherent risks developing the technology successfully, Gabriel said it’s far from “pie in the sky” at this stage.
“[Operators are] being forced to deploy 5G for competitive reasons, but they know that really all they’re doing is trying to reduce the cost of delivering a lot more data,” she said. “So, they are in some sort of desperation looking around for what will really make a good 5G case. Nearly everything they come up against that has very high value and some pent-up demand involves some degree of low latency.”
Feature image courtesy of Marc-Olivier Jodoin (via Unsplash).
