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White Paper

Total Value of Ownership

The arrival of 5G is a once-in-a-generation opportunity for mobile network operators (MNOs) to move beyond the role of communications enabler and monetize the applications that travel on the mobile network. This is a fundamentally different opportunity than 3G, which focused on reducing cost through IP technology, and 4G, which looked to meet consumer demand for broadband data services. While there are economies of scale to be realized in 5G as well—notably through cloud-native technologies and virtualized network functions—the ultimate goal of 5G network transformation is not simply to reduce the cost of the network but to increase the value.

Affirmed Networks refers to this as the total value of ownership (TVO), which we believe to be a more important metric for 5G success than the total cost of ownership (TCO). Historically, TCO-driven transformations have delivered incremental savings against a backdrop of flat-to-declining revenue for voice, text, and data services. During the same time, over-the-top (OTT) providers have adopted the role of mobile service innovators by creating new services to run on top of the mobile network—and reaping the financial benefits of the value those services bring to market.

In this white paper, we’ll discuss how MNOs can build a value-driven network, where the innovation opportunities lie for the future, and how to measure TVO to ensure their 5G network investments not only drive down costs but drive up revenue.