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5G Won't Save AdTech or Publishing

James Rosewell

2/28/2019 9:23 AM

Opinion

Mobile World Congress 2019 is really all about 5G.

Despite the consumer hype about foldable phones, Mobile World Congress 2019 is really all about two letters. 5G.

Equipment vendors like Nokia, Ericsson, Huawei, and ZTE all want to sell their kit to mobile network operators (MNOs). MNO’s exhibition stands are crammed full of 5G demonstrations. Remote controlling drones or autonomous cars over 5G is a popular demo because the mobile network needs to have guaranteed availability and low latency.

So, we know what 5G will do. But when will 5G arrive?

figure1 remote control cars from korea telecom

Figure 1 - Remote control cars from Korea Telecom

Show me the money

Today’s front page of the Congress daily newspaper quotes the CEOs of Telstra, Liberty Global and Etisalat all explaining the problem. In short, 5G will cost a fortune and, in a world of declining profits, evolving business models, and LTE/4G doing a fine job, there’s just not the business case to make the investment. Their shareholders would rather hold onto the money.

When coupled with a limited number of suppliers - ZTE and Huawei are banned by many governments - the infrastructure costs are even higher.

So, in developed markets with acceptable LTE/4G deployments, the answer is; not soon.

figure2 mobile world live operators wrestle with 5g capital spend

Figure 2 - Mobile World Live - Operators wrestle with 5G capital spend

Slow-Mo

For those not involved in the business of fly drones, such as AdTech and publishing, faster networks benefit performance. The transactions needed for programmatic advertising can happen quicker, and the data needed for rich media can be transferred faster. Adverts will display instantly and be more viewable. 5G will bring benefits.

However, networks aren’t the main cause of poor revenue performance. Bloated technology stacks within publishers and AdTech businesses and inefficient JavaScript on the web are far more likely to be the technical root cause of lost profits. Ads that don’t display, or slow web pages that users abandon, are all experienced on Wi-Fi networks today.

CTOs - Simplicity Please

CTOs within AdTech and publishing need to prepare their technology stacks and businesses for a 5G world. 2019 has offered a reprieve as MNOs wrestle with the economics of 5G deployment. But 5G will happen and users’ expectations will change. Those that are ahead of the curve will win, and those that are slow and bulky will be abandoned.

CTOs operating in a web world need to reduce reliance on JavaScript and responsive “frontend” technologies and embrace server-side optimizations. AMP championed the logic, even if the implementation is somewhat flawed.

Data augmentation layers within DSPs, SSPs and exchanges need to be enhanced to shave every microsecond off the transaction times. Slow databases or technology partners need to be eliminated.

Analytics need to be enhanced to better understand the capabilities of networks and devices. The same content served to an Android device built around a MediaTek MT6739 processor like the Ulefone Armor X takes roughly 3 times longer to appear than an iPhone XS. These differences really matter to businesses that care about profit.

figure3 ulefone armor x
Figure 3 - Ulefone Armor X

CTOs must identify these improvements and take a lead in establishing a C-suite agenda with equal importance to other imperatives.

I wrote about the business model changes in 2018 for Mobile Marketing Magazine. Read the in-depth piece here.