Explore innovative 5G monetization strategies that go beyond traditional subscription models to unlock new revenue streams and deliver exceptional value to customers.
5G services are taking the communication industry by storm. There are different 5G offerings from CSPs (Communication Service Providers) with innovative new pricing strategies. A 5G monetization strategy goes beyond the traditional subscription billing model and keeps at the center the flexibility of usage by end consumers.
This blog explores different but innovative new 5G monetization models that are being introduced in the market.
One of these strategies might just be the one that gives you a clue to building your own innovative 5G monetization strategy for your offerings.
It is a very good question. Let's explore this question first, briefly. The 5G services are providing the data at the speed of 200 MBPS on an average. That is up from about 20 MBPS speed of 4G services. This is 10 times faster. This higher speed will have an impact on various businesses. Take an example of online content delivery platforms. They will have more shows, more reach and more consumers for their content.
This means the scale of each business has potential to grow at a rapid rate. For 5G infrastructure providers (or MNOs), it opens up new B2B possibilities beyond the traditional consumer business. The MVNOs or Over The Top providers also are becoming more competitive by providing more value added services. When they provide more value with their services, they look for innovative ways of monetizing their offerings.
It is the growth in scale, growing competition and generation of more value added services that is creating the need for different 5G Monetization Models than the more traditional ones with 4G.
Let's dive straight into exploring some innovative 5G monetization models and explore what would make a perfect 5G monetization strategy for your business:
The Mobile Network Operators (MNOs) have invested heavily into the 5G infrastructure. They do have a traditional consumer business with a large number of subscribers who continue to use the 4G and 5G mobile services with them. As 5G is being launched phase wise and even region wise, their 5G subscribers may be using 4G LTE services from time to time, depending on the region they are traveling to. For the consumer business, it is a transitional phase and there is intense competition to grab a greater share in the market.
If the service provider is backed by an advanced 5G BSS platform, it allows the use of different innovative pricing models to support the needs of the business.
A set of different upcoming and innovative 5G Monetization Models is shared here:
A host of new mobile users are using prepaid services. The 5G service providers are luring them with optional add-on data packs that can be recharged on the fly with simple recharge options. The one-time data packs are offered in various sizes like 2GB, 5GB, 10GB, 30GB and so on.
If you recharge with a bigger data pack, your per GB data cost would get lower. So the consumers are tempted to go for bigger data packs. Also, these recharges are one-time and not recurring, which means that more and more consumers will be tempted for their one time usage without having to recharge the whole mobile plan. Some companies even offer a dynamic per GB price and allow you to choose the size of your data pack in the increments of 1GB.
Some prepaid consumers like to stick to a specific plan which is monetarily in their comfort zone. Some of them are open to the idea of providing a recurring payment instrument such as a bank account or credit card for an automated recharge. This ensures that their service never stops even if the quota for either the calls, the text messages or the data is exhausted. The BRM (Billing & Revenue Management) system of the service provider would take a payment from the stored payment instrument securely, and recharge the user's quota.
A postpaid mobile consumer could subscribe to an optional automated data boost. What happens in this option is that the postpaid mobile user subscribes to say cost a mobile plan with a 10 GB data included in the new plan. The user gets this quota is then gone recharged for every month. If the user exhausts this 20 GB quota, let's say 10 days before the renewal of the quota on the billing day, then an automatic data boost of 2 GB or 5 GB could be added to the plan. The user gets relevant SMS alerts of having received a data boost at an additional price of let's say $1 per GB.
This ensures that the user's service could continue undisturbed and also provides an avenue to the service provider to sell more data at a boost period for the user. The user can configure the number of data boosts that should be automatically triggered.
This one has been in practice for a while, namely known as the family shared pools or data pools. However, the flexibility can be offered to share your existing data pack to one or more numbers in your circle. This feature requires flexibility with the BSS platform to run the fly prepare a shared pool on request.
The 5G infrastructure has a lot of investment and recovering these investments require that new avenues of business and revenue generation need to be explored. The 5G network slicing is one such avenue. In this case, a slice of the 5G network (with dedicated bandwidth) can be offered to a corporate customer.
The B2B avenues have potential to increase the revenue of the service providers many fold.
In this prospective 5G monetization strategy called Burstable Billing, the data usage belonging to the top 5% peak load is not considered in the calculation and the other usage is charged as per the defined pricing rate. This type of pricing has been used by leased line providers and is an ideal fit for B2B contracts where network slicing is offered. This monetization model gives customer value by not charging them with very heavy amounts at the same time 95% of the usage gets charged at a defined rate, therefore acting like a win-win for both the parties.
We know the IoT solution providers rely on 4G and 5G services from the telecom network providers. The IoT devices are fitted with the SIM cards from mobile services providers and in some cases also started using the e-sims. The mobile service providers can make a B2B tie up with IoT solution providers and offer dedicated VPCs to allow their devices to connect to the servers in such a 5G monetization strategy consisting of subscription + volume pricing is ideal in such a case.
Volume pricing encourages the IoT solution providers to add more devices on the network because with addition of each device their average price per device reduces. For the mobile service provider, they continue to make higher revenue with the same VPC solution by adding more devices on the network.
In the above monetization model, a cap of number of devices can be introduced by subscription. If the number of devices cross a certain cap or a threshold then another subscription and a new VPC needs to be commissioned. The details of such a customized 5G monetization strategy depends on the agreement between the parties.
The mobile infrastructure companies are constantly looking for newer value added services, that can provide value to their subscribers and at the same time generate revenue. Some avenues and their monetization is shared here:
Mobile service providers provide their own marketplace which is usually tied up with the subscriber's online portal account.
Optional services like food delivery, tickets booking, or bill payment apps can be integrated and managed through the BSS platform.
When the users sign up for reviewing their data usage, invoices or recharges, they get to see certain promotional messages that can attract them to various one-time or recurring subscriptions to add on, optional services. This optional add-on service could be based on a tie up with a paid mobile app providing a certain service, such as food delivery, a tickets booking service or a bill payment app.
Such an add-on subscription needs to be managed by the BSS platform on the fly and track the recurring revenue as well as the commission to be shared with the add-on partner platform.
A 5G service provider could study the data usage patterns of a subscriber and suggest specific plans to the user that can save him or her some monthly amounts. This kind of suggestive promotions help service providers retain their customers, and provide such a service at an additional price which becomes a win-win for the subscriber as well as the service provider.
"The 5G market is teeming with different monetization possibilities. It needs application of an innovative business team coupled with a great BSS platform to devise a winning 5G Monetization Strategy!"
EarnBill is a flexible and a customizable BRM / BSS platform which can cater to the emerging needs of the 5G service providers.
As described through this blog, the 5G monetization models are becoming more and more innovative and a flexible BRM platform like EarnBill is the need of the hour for the 5G service providers. They need an agile platform and an agile team that can show a sense of urgency to meet their business requirements and move more quickly to provide solutions.
Adapt quickly to new monetization models with a platform built for innovation and rapid deployment.
Work with a team that understands urgency and delivers solutions that meet your evolving needs.
Support for prepaid, postpaid, burstable billing, volume pricing, and custom monetization strategies.
Leverage AI-based analytics to provide value-added services and optimize pricing strategies.
As 5G networks continue to expand and new use cases emerge, the importance of having flexible monetization strategies becomes increasingly critical. Service providers who can quickly adapt their pricing models to match customer needs and market dynamics will be best positioned to capture the full value of their 5G investments.
The key is choosing a BSS platform that enables rapid innovation while maintaining the reliability and scalability needed for large-scale commercial deployments.
Discover how EarnBill's flexible BSS platform can help you implement innovative pricing models for 5G
