Realizing The 5G FWA Growth Opportunity
Realizing The 5G FWA Growth Opportunity
Realizing The 5G FWA Growth Opportunity
com/
mobility-report
1
Please see page 30 to find out more about Wireless WAN.
3 Consumer Ericsson Mobility Report | Business Review edition | February 2023
Speed-based tariff plans offer subscription is valid, it will continue to work. enabling remote configuration and fault
enhanced FWA monetization The subscription normally reuses mobile management from a customer service
FWA is typically offered with either a broadband paradigms, possibly with center over standard protocols.
volume-based or a speed-based higher data allowances to cater for The price plan is in line with fixed
tariff structure. a household’s needs. broadband offerings. In terms of
In a volume-based case, the household For a speed-based offering, the positioning, speed-based offerings can
customer premises equipment (CPE) is household CPE is ideally a 4G/5G device have higher prices than volume-based
usually an indoor wireless device with 4G mounted on the exterior of the home. offerings, with price levels in line with
or 5G connectivity, and a Wi-Fi router Typically, it includes an advanced antenna fixed broadband offerings available
(or LAN cabling) within the home. The arrangement to improve performance, in the market.
device and subscription may be nomadic, connected to a Wi-Fi router within the Moreover, speed-based FWA
meaning the subscriber can move the device home. It is normally managed according connections are usually marketed to
to a different location, and as long as the to the fixed broadband paradigm, verified locations, where the network
capacity and performance are
dimensioned to deliver on the agreed
service levels. Finally, subscription
agreements are generally only valid
in the subscribed location.
5G FWA is being
launched across all
continents and is
the most popular
5G use case after
mobile broadband.
4 Consumer Ericsson Mobility Report | Business Review edition | February 2023
Monetization strategies Figure 11: FWA solutions addressing a variety of speed and price tiers
As with fixed broadband, segmentation of
the FWA market is critical to target a broad
variety of market opportunities. As a result, Relative ARPU
(FWA/mobile
service providers use a mix of offerings broadband)
with different price and speed tiers to
target different segments. Such speed-based
5G outdoor CPE
tiers are achieved primarily by using a 5x
combination of technologies (including 4G
and 5G) and CPE alternatives (including
indoor and outdoor). 4x
Figure 11 depicts offerings from service
providers in four different countries, 4G outdoor CPE
categorized by relative ARPU and speed. 3x
Relative ARPU is based on the ratio of FWA 4G indoor CPE
200%
175%
Monthly
pricing
(relative to price 150%
for incumbent fiber
connection 100
Mbps DL) 125%
100%
75%
0 200 400 600 800 1,000
Advertised DL speed (Mbps)
5 Consumer Ericsson Mobility Report | Business Review edition | February 2023
Optimizing profitability associated with larger cells reaching FWA – a future-proof technology
through choice of CPE more households, providing faster and FWA has emerged as the most popular
FWA profitability is affected by CPE choices more predictable broadband speeds than 5G use case after mobile broadband,
determining premises and network costs as indoor CPE and therefore commanding with leading service providers scaling
well as revenue drivers. higher prices. and monetizing the 5G connectivity
Premises costs relate to the direct costs opportunity. Its competitiveness is based
of connecting a home or other type of Finding the right mix of on three scale advantages:
premises. They include the cost for the CPE, indoor and outdoor CPE 1. FWA leverages 5G’s multi-use case
where indoor CPE tends to cost less than Outdoor CPE allows better spectral efficiency network scale, enabling service providers
outdoor CPE as it includes less expensive compared to indoor CPE. While it may be to make shared investments to monetize
antenna components. Installation cost is an absolute necessity to have outdoor CPE multiple use cases, spreading risks and
another parameter, with indoor CPE having for homes in some locations, there are other lowering initial upfront investments to
an advantage as there are no associated places, such as those close to a base station, new use cases.
costs, or only minor ones such as eventual where indoor CPE can be quite sufficient. 2. FWA leverages the scale of the global
call center support for self-installation. In cost-sensitive cases (like low-ARPU 5G device ecosystem, reaching 1 billion
While outdoor CPE often comes with a areas) or where TTM is crucial, it makes connections in 2022 (2 years faster
self-installation app, users might prefer sense to deploy indoor units, which are than 4G measured from its launch),
professional installation. typically cheaper and faster to deploy. For enabling affordable devices and a
Network cost includes all costs related example, if the available spectrum is large, broad device ecosystem.
to FWA for a RAN site (and proportion a first approach could be to provide indoor 3. 5G FWA leverages the scale of the
of other elements such as packet core). CPE to most homes, with an option to 3GPP innovation ecosystem, bringing
Outdoor CPE, with its higher spectral replace them later with outdoor units billions of dollars of R&D investment and
efficiency compared to indoor CPE, as required. new spectrum to higher capacity and
enables two to three times more FWA On the other hand, if the number of performance of devices and networks.
connections per site. As a result, unitary potential customers in an area is large
network cost per CPE can be two to three relative to the available spectrum, it might To highlight the third point, one of the
times lower for outdoor CPE than indoor be worth identifying customers who would latest 3GPP innovations has been
CPE. Some service providers mitigate benefit the most from outdoor CPE during the millimeter wave extended range
the drawbacks of indoor CPE by adding the sales process. The improved spectral functionality, enabling FWA connectivity
external antennas, including upgrades efficiency of outdoor CPE typically boosts at gigabit speeds over 11 km.
to external antennas at a later stage for range, which in turn increases coverage and In summary, 5G service providers are
high-end and cell edge users. the potential customer base, and well positioned to serve the more than
Time to market (TTM) is the first drives up the proportion of outdoor CPE. 1 billion premises that currently lack
revenue driver, as it impacts uptake of In one case study, when the fast and reliable broadband, closing
customers. Speed of deployment is a key 20 percent worst-located connections the digital divide and empowering
differentiator for FWA, with CPE choices from a radio signal strength perspective consumers and enterprises.
also affecting that parameter. Indoor CPE were assigned outdoor CPE, the average
would generally enable a faster TTM as number of connections per cell could be
there is no need for onsite installation. increased by around 60 percent, while
Another parameter is related to customer the capacity doubled when only outdoor
lifetime value, where outdoor CPE is CPE was used. Even though results are
generally correlated with longer customer dependent on individual case parameters,
contracts and lower churn compared this example indicates the effects of mixing
to indoor CPE. Finally, outdoor CPE is indoor and outdoor units.
CPE cost CPE installation Incremental capex per site TTM ARPU Lifetime value Coverage
Chipset, Call center Radio, baseband, transmission Installation Dependent Average Larger cells
antenna support, site visit and deployment services divided lead time on volume- or contract reaching more
and router and transportation by connections multiplied speed-based duration households
by revenues tariff structures and SMEs with
outdoor CPE
Indoor
CPE (external antenna) (multiple offerings)
Outdoor
CPE
(self-installation)
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