On this episode of The Six Five – On The Road, join hosts Daniel Newman and Patrick Moorhead for a conversation with Yossi Cohen, President and CEO at Ericsson North America at MWC 2024 on new innovations and the future of 5G networks.
Their discussion covers:
- A brief introduction from Yossi Cohen on his new role as President and CEO
- An overview on the first half of the 5G deployment cycle
- Insights into new innovations and what can we expect to see in the second half of the 5G deployment cycle
- The role AI and ASICs play within cellular networks
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Transcript:
Patrick Moorhead: The Six Five is on the road in Barcelona, MWC 2024. We are in the gigantic Ericsson booth here. I mean, if you want an encapsulation of all of MWC, it’s right here. I mean, you’re getting edge devices, edge networks, core, Web 4.0 industry solutions and pretty much everything in between, and of course some AI. Dan, it’s been a great show, right?
Daniel Newman: Yeah, there’s a lot going on here. It’s always impressive to come back here and see just how instrumental Ericsson is to the mobile community. I mean, it’s demonstrated here at Mobile World Congress.But it’s been a great show. It’s been high energy. The floor is absolutely packed. We’re back to capacity once again, and there is a lot of discussion. Of course, you and I make jokes, like how long can we go into a conversation without talking about AI?
The truth is AI has become somewhat pervasive, but it’s also becoming somewhat embedded. So, as you’re talking to companies, it’s network plus AI, it’s security plus AI, it’s cloud plus AI. When we’re sitting here with Ericsson, of course, there’s so much talk about how the network and the development of the network, the build out of the network and what the role AI is going to play will end up being.
Patrick Moorhead: Exactly, so it’s great time to introduce our guest. Yossi, great to see you, second year in a row. It’s our honor here. I guess the experience was okay. You came back for another one, so we appreciate that.
Yossi Cohen: Thank you very much. Nice to see you guys.
Patrick Moorhead: Yes.
Daniel Newman: Yeah, it’s the second year in a row, but he’s in a new role.
Patrick Moorhead: All right now.
Daniel Newman: So, Yossi, I mean the obvious place to start off with is… Last year we talked APIs with you, and I’m sure we’ll talk a little bit about that here-
Yossi Cohen: Sure.
Daniel Newman: … but you’ve taken a new role as the CEO of Ericsson North America. Big shoes to fill. We had him… Nicholas was one of the keynotes of our SixFive Summit last year. I think Yossi might be doing that this year with us too, by the way.
Patrick Moorhead: I sure hope so.
Daniel Newman: This is a bit of a preview, so Yossi, give us a little bit of the background. Talk about the new role and how it’s shaping your everyday life, and how excited you are, and what you’re thinking about doing first in the gig.
Yossi Cohen: Yeah, so it’s been three weeks since I’m in the new role, and I chose February to be the month where I start, where I have Mobile World Congress and a lot of activities that are going on. It is pretty exciting. It’s not my first rodeo. I mean, I’ve been in North America for the last eight years. I’ve been around the world, in Tokyo and in Stockholm. But it is very exciting and I’m really, really enjoying it. I told my team as well, I’m really enjoying it. And they’re looking forward for how to shape this industry because I do think that we are a little bit in a pivotal position in terms of the industry, going forward.
Patrick Moorhead: You’ve always been a straight talker, and I really appreciate that. I think the first question that a lot of folks who aren’t necessarily in the beltway of telco want to know, what is the state of 5G? Where are we on this map, on this journey? And has it exceeded expectations, not exceeded expectations, or something? I’m asking the wrong question here.
Yossi Cohen: Yeah, I know, the 5G people ask, “Where is the killer app? And where’s the monetization?” So, let me give you some data points. First of all, 5G is the fastest adopted G in the history of all Gs. That’s one thing you should know. And I’m not talking just in terms of deploying of the network. I’m talking about users actually having these capabilities on their phone. So, pretty fast.
I think the status in North America is, today, that a lot of 5G was launched with dynamic spectrum sharing with 4G. But actually bringing in the real 5G user experience, then you need to bring the bandwidth associated with millimeter wave and particularly with mid-band. This happened a bit late in the United States, and that created a situation where operators were really pushing the gas for 18 months or 24 months and deploying the C-band to provide the right experience.
That’s why what you’ve seen in 2021 and 2022 last year, they pushed the brakes because most of operation got covered. But if you really want to count and understand where we are on mid-band deployment, which is the actual giving you the experience of 5G, it’s around 50% of the sites that exist today in North America actually have mid-band. So, there’s still long way to go when it comes to the deployment, but of course there’s other stuff that needs to be introduced, like 5G SA, that enhance the capabilities and open up and launches new types of capabilities for operator to use.
Daniel Newman: So, you started to allude to the drop. ’23, investment slowed a bit, and in the network deployments, some speculate, “Is this it? Is it over?”
Patrick Moorhead: Well, that’s done.
Daniel Newman: I think we know that isn’t true, but talk a little bit about what this next, the… Can I call it the second half?
Yossi Cohen: Sure.
Daniel Newman: For the second half of the 5G deployment, of course, because others were here. I mean, next year we’re going to be doing like 6G or start previewing 7G. I joke, but what’s the second half look like? Is it going to have that same veracity and velocity as the first half? What do we have to look forward to here?
Yossi Cohen: It is a bit transformative, so, yes, the deployment will be less urgent. And to be honest with you, it is better for the industry. This kind of peak deployments and then push the brakes is not super good. In general, I’ve been a veteran in this business for more than 20 years, this is a cycling business when it comes to the deployment of the infrastructure, but I do think that we are in a pivotal moment when it comes to the industry.
If you come here outside, you see we are launching Cloud RAN and Open RAN. We are launching our global network platform with Vonage. All these things are in order to enable the operators creating significantly more application and use cases, for whether enterprise or subscribers, consumers.
Patrick Moorhead: A lot of people like to talk about the killer app, okay. Which, by the way, for cycles of different types of technology sometimes made sense, sometimes it didn’t, but the reality is it’s a cumulative effect of value that 5G brings to the table across the different elements.
And from your point on mobile, I mean mobile has done very well so far. And FWA I would put up there in North America as an absolute killer app. So to use Dan’s kind of terminology of the second half, what are some of the second half use cases that we can look forward to? Maybe brought by network slicing, maybe brought by massive MIMO, Web 4? What are you looking at and excited about?
Yossi Cohen: Well, to be honest with you, I think the killer app is the network itself and what it enables. I mean, today when you use your phone, the killer app is not Voice and it’s not Instagram. The killer app is actually everything you can do with it. And in order to do that, we need to build massive networks with high capacity. You mentioned massive MIMO. We are showing here our ASIC that is developed specifically to be the most efficient in driving this spectrum to the max.
Operators in North America spend $84 billion on C-band. That’s hell of a lot of money before you even started building an infrastructure and selling devices. It’s extremely important for us and for them that our technology will take the maximum in terms of capacity and coverage when utilizing this technology. That’s the part of the infrastructure, but then you want to monetize. How do you do that? Network slicing. When we introduce 5G SA, suddenly you have the capability to dynamically allocate slices to different capabilities, whether it’s for enterprise or for consumers.
Enterprise, for example, you can slice a secure private network from the public network that is dedicated for an enterprise. Operators can monetize that, and also enterprise can innovate and actually save on having an on-prem system. If you want to move to a consumer with network APIs, suddenly capabilities that are associated with quality on-demand, or more security, or silent authentication will enable the consumers to use higher capabilities. I’ll give you an example. If you are sitting in a stadium and you finish the concert or a game, usually people come out.
They want to order a ride. The networks are extremely busy because people are YouTubing, streaming and using whatever. Before 5G SA, before network slicing, the networks are behaving just like 4G. What does it mean? It doesn’t differentiate whether you are watching a YouTube, Netflix, or you actually need to call your network share to actually order a ride. This will enable you to differentiate the services and better use the infrastructure in the spectrum to the different use cases and, of course, monetize on that.
Patrick Moorhead: Yeah, I’m a huge fan of network slicing. I mean, not all devices need a high bandwidth, low latency. Now, the way we used to do it was, “Hey, we’re going to put the old networks and use that,” which by the way, cost almost as much as the new network. Sure they were capitalized and paid for, and then, by the way, that network went away in a few years, whether it was an E-reader that maybe had integrated wireless.
But now, getting on one standard and being able to slice that, whether it can be the billion Web 4.0 devices that we keep talking about, a home IoT device that you just want to be on all the time and working, I think there’s huge possibility. That’s what I’m looking forward to in the next half of this transition because it truly is something that none of the other Gs could ever, ever provide. And just, gah, will you guys hurry up with this with your customers?
Yossi Cohen: Listen, when we designed 5G, one of the advantages that we wanted that to have is we wanted it to have the flexibility to do all these things, to have the 5G SA, to have the cheap devices that you can put for IoT, the lower power consumption devices, definitely targeting for different use cases.
Patrick Moorhead: Yes. And by the way, just for let’s say analysts, we have to have facts. I know one of your customers is deploying this and has a special channel for security. So, it’s there, but I’d like to see a lot of them to be able to do that. And let’s drop any home IoT device. I’d like to have this capability.
Daniel Newman: By the way, there is so much room for improvement and so much opportunity, Yossi, when you were talking about coming out of a concert or a sporting event. We talked in the green room a bit. We’re all car folks. You and I love F1, but 400,000 people come to Austin. You walk out of that place. You’re trying to find someone. You’re trying to get a text message out. I mean, you go, “Why is it so bad?” Really, what you’re saying are all problems that can be solved with the advanced capabilities of slicing and what you guys are doing versus everybody depending on this common carrier network.
These are still killer apps. I mean, I’m not even trying to sound cynical, but getting a text out, I find myself in places and you’re like, “Why can I not communicate?” Or we still have room to grow with up speeds and down speeds. Like, I’m in an airport, and I want to watch a Netflix movie on the plane. And I try to really quickly, without Wi-Fi, get on the network, and never going to happen. I’m saying there’s room for growth and improvement.
And what I’m saying is you look at next generation, what happened in the last few months is Apple came out with a new product that’s going to change industries, with the Vision Pro. Look, we’re all running around town trying to walk with a little compute tied to our back. You’re not going to have Wi-Fi all the time. These apps have to be able to be done on mobile networks. So, in my opinion, Yossi, there’s so much excitement and room to grow. I mean we’re not done, are we?
Yossi Cohen: Absolutely not. I think the Apple device, you can say whatever you want on it. It does show you that there is a use case-
Daniel Newman: He has one.
Yossi Cohen: … that… Yeah. Yeah, but remember. On the moment that this will be a phone factor that will be relatively lower cost and easier to carry, everyone will have it.
Patrick Moorhead: Yeah, we’re getting there.
Yossi Cohen: Yeah.
Patrick Moorhead: Yeah, we’re-
Yossi Cohen: Everyone will have it.
Patrick Moorhead: … headed in the right direction.
Yossi Cohen: But what it shows you is it’s a sandbox that shows you that actually there is a lot of use cases that can be done similar to the phone. Actually, suddenly it could be in the scale of the phone, and it will require way more from the network to give you a better user experience. Also, it might also require edge compute from the mobile network in order to make sure that the phone factor goes down.
Patrick Moorhead: I don’t see how we do this without edge compute. I mean, I’m thinking of the model. And while we’re all excited about zero latency, that’s just an impossibility. It even goes against the law of physics. What I’ve seen over the last 30-plus years is when you bet against physics, it doesn’t work out very well. So, yeah, that-
Daniel Newman: You can bend it. You can’t break it.
Patrick Moorhead: No, exactly.
Daniel Newman: Yeah, exactly. Well, then it’s interesting, though. There was a company here, I think, that put out a laptop that had see-through display. I think it maybe was Lenovo here. And, of course, we’re talking about the wearable. I totally agree with you, form factor still doesn’t work for the masses, but starting to see. Because I always said that the stuff where you’re closed in isn’t the end game, but the stuff where you’re looking through-
Yossi Cohen: Yes.
Daniel Newman: … that’s going to be the augmentation. And by the way, it’s like vehicles. We’ve been doing that in a car for a long time, the augmentation in your dashboard. What I’m saying is C to V, C to V to G, these are all big net edge applications where the network is going to be very, very important for this. But I want to change topics to something that nobody here is talking about. I want to talk about AI because when you come to a tech event in 2024, it’s like you got to pry people.
Can we talk about AI, please? Because we only want to talk about 5G. No, I’m sorry, a little levity. So, talk about that, though. I mean you haven’t really mentioned it much, but it is the hottest topic in every tech event around the world. I actually met with one of your peers, Asa Tamsons, in WEF, and we talked a lot about it. She was talking about sustainability in AI. So here we are talking about networks in AI. What is your sort of perspective on the proliferation of AI and the influence that it’s going to have on your business?
Yossi Cohen: Yeah, so to look at it from two perspective, one is, AI use cases that are actually using the network. Obviously people, even when they use the basic ChatGPT, people use mobile networks to do that. But then you ask yourself, what kind of other uses of AI? So much content is going to be suddenly generated. It’s today with so like what you’ve seen. It’s so much easy to generate content. That will increase the demand. But also, let’s say you want to have a personal assistance using AI. That will require much lower latency.
Daniel Newman: Sure.
Yossi Cohen: Because of these capabilities of AI, if you see the innovation around it, it is requiring the network to behave very differently. So one of the things we are looking at it, okay, so how the networks needs to be tuned in order to adapt into this kind of requirement? That’s from the demand of the users, and the innovation will continue to accelerate there. The other angle is, what do we do it with the network? I explained before how important it is to have an efficient network, how much you need to push as much as you can when it comes to coverage and capacity. What we are showing here in Mobile World Congress, we’re also showing Open RAN.
We’re also showing SMO, and we’re also showing a lot of open interfaces. AI is already a tool that we are using in many of our platforms even before that. In order for example, manage power consumptions of our radios. We deploy radios in scale, millions of radios. And with utilization of technologies like AI, we are actually showing how we can be smart of how to operate them, how we can optimize the performance of the users. And this will continue to be a tool that we’re using not just to accelerate our development, but to optimize what our product is doing.
Patrick Moorhead: Yeah, one of the big themes of the show does seem to be a conversation around energy consumption. There’s a macro view that hyperscaler data centers could end up being 12% of the entire energy draw of the planet, up from about 2%, and this will be in about six or seven years. Those aren’t my numbers, but they sound reasonable given how much power we’re using to train and infer generative AI models. It makes a lot of sense to me.
You focused a lot on reducing the footprint of your equipment through some ingenious ways. One of them is through machine learning algorithms. I know they can have a better sense of the traffic and knowing when to turn certain elements off or reduce power. How are you doing that? Again, I’m not asking you to pre-announce something, but you can if you want. How are you doing this? And how are you approaching this? Because it’s one thing, you can’t just turn something off. It still has to be useful.
Yossi Cohen: First of all, as you know, mobile traffic continue to grow every year by 30%. Now with fixed wireless, that’s actually even going further. And if the power consumption will continue to grow in the same scale, it just doesn’t work. What we’re trying to do with our technology is first of all to always use the latest and greatest hardware, meaning latest and greatest transistor technology. And also, we are introducing ASICs-
Patrick Moorhead: Yes.
Yossi Cohen: … to best have… in terms of the hardware needs, to be the most, most way to reduce the power consumption. Because remember, when we deploy, we deploy in scale. It’s not just one. You deploy millions of them. It’s very important for us to make sure that it’s very efficient, so the wattage per bit are the lowest possible. That’s where we are since we gather a lot of data from networks, and that’s the key.
When it comes to AI and machine learning, we get a lot of data, how the user are behaving, how the network is behaving. And we teach the machine learning how to optimize how the network is being. So, in a way, with using AI, we know how to shut down different ASICs in the different times of the day, based on the traffic that’s there, just to make sure. Yes, if the traffic is there, I can handle, but if it’s not there, I can actually shut down part of that processing.
Patrick Moorhead: Yeah, bravo on the forethought. Did we just have a chip conversation? No. We did. No, it is interesting.
Daniel Newman: No, I love that.
Patrick Moorhead: Chips have become popularized. You can, even talking around the dinner table, “Why can’t I get my car or my car with a radio?” It was because of chips. And now chips and what’s going on with AI, but you’ve actually had the forethought for years. I know this is not something new. You’ve been creating ASICs which are in the grand scheme of things, versus CPU/GPU, they are the most efficient way that you can get a workload.
What’s funny is, Dan and I have been on network news stations trying to explain ASICs. That will, I do believe, will be the next generation. And then fact that you’re pouring so much R&D into this and not taking your foot off the gas, I think is very, very smart. Takes a lot more work, but it’s definitely the right way to go.
Daniel Newman: So, Yossi, backstage, you said something to us that you wanted to… I don’t know. You wanted to do the hosting job for a minute, and you wanted to ask us a question. This will be a first time ever on air that Patrick and I accepted a question from a guest, but-
Patrick Moorhead: Wait a second here, Dan.
Daniel Newman: Oh, I’m kidding, but anything you want to ask the analyst on our way out?
Yossi Cohen: Yeah. You guys are having a bit of a external perspective. I’ve been in Ericsson for many, many years, so I really want to understand from you guys. Walking in the corridors of Mobile World Congress, what is the most interesting things that you’ve seen here?
Daniel Newman: Look, I wanted to really kind of double-click, Yossi, on what you were saying about the second half for 5G. I love what you put out there about the killer app being the actual network and what you can do on it itself. I know that sounds really simplified, but in the truth, everyone is slightly different, so the experience of just being able to go out, seamlessly get an app, secure, verified, capable, and then connect and just use it. Now the second half, what I’m looking forward to… Pat and I were walking down the street. I think it maybe was here in Barcelona the other night, and you looked at me and go, “Are you getting 5G here?” And I looked at him. I’m like, “I’m not.”
I’m really excited to have that advanced, highest throughput connectivity that 5G can offer everywhere I go. I know it sounds like I’m oversimplifying, Yossi, but the power of the apps, the power of these VR sets, the power of the things you can do… We talk about driving cars behind the wheel, being able to do real-time lap time around a track and track your… Amazing, low-latency experiences that are created as long as you have that connectivity. So, I’d put it back on you and say, I can’t wait for y’all to get the second half done. Give us that connectivity that we need everywhere we go, reasonably speaking, because I think you’re a long ways to where we need to be, based on my foresight of what’s coming.
Patrick Moorhead: Yeah. I mean, I talked about network slicing, but I think overall, I mean network slicing is in there. I’m pretty excited about how each individual system in a system of systems will use AI. We see devices that have on-chip AI, that are a hundred times more powerful than the most powerful GPU was 5 years ago. What are we going to do with that? And then I want to see how those systems talk with the other systems to be more intelligent, so for instance, an endpoint talking to a network.
I know, because I’ve seen the technology, is it becomes a two-way street. How can I optimize network efficiency when the device is super smart and the edge is super smart? That’s one thing that I know there’s a vision there and a little bit of that going on, but right now it’s primarily the network as opposed to the device and the network. I think the two combined as a symbiotic force, I think we haven’t seen nothing. I’ve seen a few demos here that I thought was interesting, but that’s when some real magic happens.
Daniel Newman: Yossi, you’ve brought the CNBC analysts out in us. You’ve put us on the hot seat, like the recent SKO where you and I got a CEO comes up on stage and starts asking us questions.
Yossi Cohen: Okay, good.
Daniel Newman: I love doing both sides. Yossi, thank you so much. Congratulations on the appointment. We look forward to working closely with you and continuing to see, track, monitor and, of course, analyze, educate on the Ericsson journey. Let’s have you back soon.
Yossi Cohen: Thank you for hosting me.
Daniel Newman: Thanks. All right, everybody, hit that subscribe button. Join us for all of our episodes here at MWC 2024 in Barcelona for Patrick Moorhead and myself. We got to say goodbye for now. We’ll see you all later.
Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
