Industrial verticals hold the promise for the business of 6G

Industrial verticals hold the promise for the business of 6G

”We can't win in 5G or 6G by playing defense. We have a very strong offense game in this regard. And to win, we have to be ready to disrupt the old business practices and change the rules with new concepts”, says Dr. Petri Ahokangas, Professor of Future Digital Business at Oulu Business School. He will focus on 6G research over the next couple of years as he joins the 6G Flagship crew full time – bursting with enthusiasm.

In conversation, Ahokangas peppers his replies to an interviewer's questions with plenty of questions of his own. How do we regulate businesses in 6G? How do we take the lead in benefiting from new technology? How do we converge data platforms with connectivity platforms? And, most importantly: How do we create new business opportunities and business models and whole new business ecosystems in 6G?

Ahokangas is an experienced hand in telecoms and business, and in the business of telecoms. He has been in the business since 2G or GSM, when he took up a position at NetHawk, an Oulu-based company which developed testing tools for telecommunication networks. Ahokangas helped to build the international expansion strategy for the company as well as held other positions such as leading IT and HR functions during his eight years in the company.

”That was my schooling in the telecoms industry. NetHawk expanded rapidly to Europe, the U.S. and Asia. Now, I had a business degree but very little understanding of the technology. I had to pick it up fast, as the company was based on understanding of not only current mobile technologies but future technologies, too, as they were developing measuring equipment to test next-generation networks,” Ahokangas explains.

Currently, Ahokangas has already nearly a decade's worth of 5G research under his belt. It was not always clear that this would be his path, as he vowed never to deal with computers or mathematics after he got out of school.

”That immediately backfired. My first real job was at the University of Oulu, working with statistics and data. So much for my promise to myself,” Ahokangas says with a chuckle.

Major business opportunities

Begrudgingly or not, Ahokangas became so well-versed in technology that when it was time to kick off the first 5G research project in Oulu, he was perfectly positioned to bridge the technology side of things with business thinking.

”I could keep up with all the tech jargon and acronyms. At the same time, I was looking deeply into my areas of special interest: business models and business model ecosystems,” Ahokangas explains.

An ecosystem is a collection of synergistic business models, says Ahokangas. The problem herein is that so far companies have fought to optimize their own business models at the expense of other companies' business models. This needs to be changed. Industrial verticals are at the very center of Ahokangas' research, as he believes that is where the potential lies for new added value.

”In the consumer market we've seen that there are only a few big platforms, like Facebook, Google, Amazon and so on, that dominate the playing field and there is practically no room for others. Newcomers are often acquired by the big players and absorbed into them. On the other hand, in the industry market there is not yet such consolidation, which means that there are major business opportunities available,” Ahokangas says.

As everyone wants to own their platform, applications and infrastructure, clients can get stuck in an environment with multiple proprietary systems and may find the environment financially untenable. The way Ahokangas sees it, there will be converging platforms and ways to benefit from them.

”The big paradigm change for telecoms operators is shared spectrum. 5G is about smaller cell sizes, and mobile networks have to go inside buildings, so, who is going to build and maintain indoor connectivity? Surely not the big operators. Instead, you'll see local network operators in campuses, hospitals, sports arenas, retailers and so on. Retailers already 'own' their customers with loyalty card programs and so on. Why would not they have a mobile network of their own to offer their customers in the future?” Ahokangas asks.

And going from connectivity to content such as data and opening commerce platforms means that all these platforms of different players will converge. Ahokangas has been working for example with the Port of Oulu, which has been building a local 4G network with digital services and plans to go to 5G. The port is an extremely interesting case, says Ahokangas, because it contains all the different challenges that come from different interest groups having to operate in close collaboration.

”You have all different kinds of companies with different information systems going from logistics to customs and so on. Some working within the port, some working outside of it, some in competition with each other. Digitalization can benefit all companies at the port. It is also worthwhile to ask how the services could complement each other and add value to existing systems? This is a great business opportunity,” Ahokangas says.

You have to be willing to shake things up

Much has been speculated about what 6G will bring in the next decade, and, for obvious reasons, no one can say for certain at this point. The first white paper on the business of 6G –named, appropriately ”White Paper on Business of 6G”– was published in June 2020, edited by Seppo Yrjölä, Ahokangas and Marja Matinmikko-Blue. The joint work discusses how Artificial intelligence (AI) is going to thoroughly enhance our technology going forward, with far-reaching implications for business.

”What kind of AI-based business models will there be? How do you automate business? How do you create new business that takes advantage of existing platforms? What about regulation? How do you regulate 6G networks, and how do you regulate business that is based on 6G networks?” Ahokangas lists the questions that are close to his researcher's heart. ”These things are extremely interesting and no one knows the answers yet.”

When trying to imagine the opportunities that near-instant telecommunications will hold for us, Ahokangas turns to business models as a tool. ”It is a way to look at alternative outcomes, alternative futures. Option A, option B, they are always a part of an ecosystem. You propose a model and then look at what is required for it to work,” Ahokangas muses.

And maybe what is required is disruption, writing a new rulebook for the game. If the technology advances by leaps and bounds, it stands to reason that the business side of things have to do so as well: to change the mindset from defense to offense.

 

Text&photo: Janne-Pekka Manninen

 

Last updated: 10.2.2021