Nokia to Offer Network Slicing for 4G and 5G by This Summer

In February 2020, Nokia announced that it was undergoing live trials for 4G and 5G Non-Standalone (NSA) network slicing use cases in partnership with Austrian operator A1 Telekom and Swedish-Finnish operator Telia. Nokia has said that network slicing for 4G and 5G NSA will be rolled out by mid-year, with Huawei following the same pattern, having deployed their Multi-access Edge Computing (MEC) for Sany last year, utilizing network slicing for its industrial applications.

This comes alongside news of a potential delay in the 3rd Generation Partnership Project (3GPP)’s Release 16 and Release 17 due to the coronavirus (COVID-19). Release 16 was initially due to be completed by June 2020, but this may be delayed until closer to the end of the year. Initial discussion plans for Release 17 have also been postponed to April because of the virus. Both specifications are seen to be crucial for industrial 5G use cases, with Release 16 being responsible for addressing some of the most important Ultra-Raeliable Low Latency (URLLC) and high reliability (with five 9s) features, and Release 17 to define massive Machine-Type Communications (mMTC) for 5G.

These initial network slicing trials could be an opportune stopgap for the delay in the 3GPP Releases. A study done by ABI Research found that a lack of finalized standards for 5G is holding back the deployment of industrial 5G for the automotive and consumer goods manufacturing sectors. An immature 4G and 5G device ecosystem, however, was a consistent technological barrier to deployments across all three manufacturing sectors of automotive, consumer goods, and machinery.

The continuous development of the key technologies meant to enable industrial 5G (i.e., network slicing) for current 4G and 5G NSA deployments is a prudent move to ensure that there is sufficient and relevant activity in the market for manufacturers to remain interested and engaged in formulating their business cases around deploying wireless for their Industry 4.0 digital transformations.

ABI Research’s Digital Factory Market Data (MD-IICT-105) found that commercial 5G industrial deployments will enter the market in 2021 and grow to over 88 million digital factory connections by 2030. ABI Research’s latest Industrial and Manufacturing Semiannual Update (PT-2277) states that, in the short term, there will be a rise of cloud-based Computer-Aided Design (CAD) and more early 5G trials, leading up to more public deployments as 5G takes shape, with 5G experiments with cobots and Augmented Reality (AR) smart glasses. In the mid-term, 5G will drive remote and real-time control, enhanced real-time data gathering and alerts, network slicing, and predictive maintenance for the industrial sector. Quantifying this, ABI Research has found that, without asset tracking use cases, in the short-term (2022) there would be about 200,000 digital factory connections utilizing 5G enhanced Mobile Broadband (eMBB) and Ultra-Reliable Low-Latency Communication (URLLC), and an insignificant number of connections utilizing mMTC. However, in the mid-term (2026), URLLC will become the dominant use case, with nearly 7 million connections, followed by eMBB and mMTC. However, if we were to consider asset tracking use cases, ABI Research forecasts that mMTC will become the 5G feature that the majority of digital factory connections will depend on.

As Release 16 was also meant to complete the standardization of slice roaming, with the ability to migrate the slice out of the private campus and onto the public network, for foreign operators to be able to enable their roaming customers to utilize a local slice, and slice-aware radio resource management, it is unclear how this might impact Nokia’s decision to release network slicing for 4G and 5G NSA. However, its current live trials might mean that this endeavor does not necessarily rely upon Release 16’s specifications.

Network slicing is a “logical network” that provides specific network capabilities and network characteristics. Some of these capabilities include varying levels of eMBB, URLLC, and mMTC features, and characteristics could refer to different levels of end user control and Service-Level Agreements (SLAs). A single network slice can provide one or more services, and each slice can be composed of multiple sub-networks, such as the Core Network (CN) or Radio Access Network (RAN).

Communication Service Providers (CSPs) should be aware of the forthcoming business models that will arrive out of 5G network slicing. While we are currently in the initial stages of 5G, which offers mostly eMBB-centered solutions, as URLLC and mMTC enter the scene in the mid to long-term, network slicing will become one of the main new revenue generation streams from the industrial sector. Generally, in this business model, the CSPs will provide slicing services and products (which may include their own on-premises edge or cloud deployment to enable the slicing capabilities), with a suitable pricing model. This pricing model could be a monthly subscription that would include the CSPs’ maintenance and continued offering of the slicing service, a transaction charge for each new slice, or perhaps even pricing based on the traffic and timing used.

The network slices can be provided directly to the consumer/business, or through a third party such as an Over-the-Top (OTT) content provider or an external vendor—e.g., a cloud company like Amazon Web Services (AWS) or a network equipment vendor such as Nokia. If CSPs were to tap into this new revenue opportunity, they would have to avoid being disintermediated by securing their positions in the supply chain, either through partnerships with third-party providers or by developing their own deployment and integration capabilities.