Using Scenario-based Business Modelling to Explore the 5G Telecommunication Market

Abstract

Innovative technologies often alter established value chains and make traditional strategic planning methods inadequate. In this paper, we present the use of scenario-based business modelling to explore the market for the fifth generation mobile communication networks (5G). We discuss four scenarios that have been developed in a collaborative effort among different actors in the market. We then describe the approach to build business models and discuss lessons learned and benefits from the novel approach. This approach complements traditional techniques through providing a powerful platform to integrate multi-dimensional change, from technology, regulation, value-chain dynamics, and value proposition evolution. We further conclude that the approach is particularly valuable in environments that are characterized by a high level of uncertainty and complexity.

Full text

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DOI:10.6531/JFS.2017.22(1).A1
Journal of Futures Studies, September 2017, 22(1): 1–18
ARTICLE
Using Scenario-based Business Modelling to Explore
the 5G Telecommunication Market
Sara Moqaddamerad
University of Oulu
Finland
Petri Ahokangas
University of Oulu
Finland
Marja Matinmikko
University of Oulu
Finland
René Rohrbeck
Aarhus University
Denmark
Abstract
Innovative technologies often alter established value chains and make traditional strategic planning methods
inadequate. In this paper, we present the use of scenario-based business modelling to explore the market for the
fifth generation mobile communication networks (5G). We discuss four scenarios that have been developed in a
collaborative effort among different actors in the market. We then describe the approach to build business models
and discuss lessons learned and benefits from the novel approach. This approach complements traditional techniques
through providing a powerful platform to integrate multi-dimensional change, from technology, regulation, value-
chain dynamics, and value proposition evolution. We further conclude that the approach is particularly valuable in
environments that are characterized by a high level of uncertainty and complexity.
Keywords: Scenario Planning, Business Modeling, Value Networks, Anticipatory Action Learning, 5G.

Journal of Futures Studies
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Introduction
The next generation of the wireless network technologies known as 5G will be the major
evolution phase in the provisioning of mobile broadband services being deployed around 2020. 5G
will disrupt the mobile telecommunications industry by opening the market to new entrants that are
especially expected to emerge in indoor small cells to provide mobile broadband services (Pujol,
Elayoubi, Markendahl & Salahaldin, 2016). 5G networks will become a substantial part of today’s
mobile network operators’ (MNOs) heterogeneous networks of 2G, 3G, 4G, and Wi-Fi technologies
(Moore, Sanches & Boman, 2014). 5G will expand the traditional mobile business ecosystem to
meet vertical sector-specific requirements in a world where everything is digital, smart, and hyper-
connected (5GPPP, 2016).
As claimed in Ahokangas, Matinmikko, Yrjölä and Okkonen (2013), to capture and understand
the consequences of a mobile market change for MNOs, three domains of change need to be
taken into account: regulatory, technology, and business. Regulation plays a key role by defining
who is allowed to enter the market through spectrum licensing and by creating conditions that
directly influence the possible business opportunities. From the technology perspective, 5G
promises to provide innovations that increase sharing of spectrum and network infrastructure
and creating a sharing economy within wireless communications (Andrews, Buzzi, Choi, Hanly,
Lozano, Soong & Zhang, 2014; Yrjölä, Matinmikko, Ahokangas & Mustonen, 2016). The business
perspective is specifically related to the nature of opportunities through alternative future scenarios,
value networks, and ecosystems that are strongly influenced by regulatory and technological
developments. To take advantage of the business ecosystems’ opportunities, a business should be
able to develop an understanding of the entire system, reinvent itself, and absorb various resources
for future purposes (Kandiah & Gossain, 1998). The innovative 5G business models are expected to
be centred on creating and capturing value through multi-partnership within the collaborative value
ecosystem (Hamari, Sjöklint & Ukkonen, 2013).
To survive in an emerging new ecosystem and market of tomorrow, companies need to
constantly envision the future value and the upcoming transformations by sharing their visions with
other actors and collaboratively shape the future (Moore, 1993; Rohrbeck, Battistella & Huizingh,
2015). To make sense of 5G’s volatile, uncertain, complex, and ambiguous future, research on
alternative 5G future scenarios becomes a necessity to form robust and agile strategies.
In this paper we apply an anticipatory action learning–based (AAL) research approach. We
facilitate the creation of scenarios and moderate the subsequent development of ecosystemic
business models to explore the future market that is created on the basis of 5G technologies. This
research seeks to respond to two major questions:
1.
How to explore future 5G business models through scenarios?
2.
Why can scenario-based business modelling enhance the ability of a network of actors to jointly
explore future market?
In the article, we first, in section 2, introduce the theoretical basis and rationale of applying
scenarios in organizations for investigating new businesses. Moreover, we define business
ecosystem and business models. In section 3, we introduce our novel approach to scenario-based
business modelling. Section 4 describes the resulting scenarios and business models within the 5G
ecosystem. Section 5 concludes the paper by presenting the benefits of our novel approach and its
contribution to the research field.
Why Use Scenario-Based Approaches for Business Modelling?
Challenges of exploring uncertain and complex new business fields
Many industries have seen a shift from an industry-driven economy to the knowledge-based

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Using Scenario-based Business Modelling to Explore the 5G Telecommunication Market
economy, which has led to a steep increase of environmental uncertainty and complexity. In
addition, science and technology have become the key drivers of rapid, complex, and pervasive
change. Consequently, exploring new business fields or developing new products has become
increasingly challenging and novel approaches suitable in such environments are needed for strategy
formation and prospective innovation management (Ruff, 2015; Peter & Jarratt, 2015). Reduction
of product-life cycles have led to the need to develop methods that permit to anticipate systematic
changes and translate them into organizational responses in the field of strategic and innovation
management (Hines & Gold, 2015; Rohrbeck & Gemünden, 2011).
Exploring new business fields is a challenging task because it requires the integration of various
interdependent perspectives including customer satisfaction, technological potential, competitor
reaction, as well as active stakeholder involvement (Heger & Rohrbeck, 2012). Additionally,
development of a new business field occurs when a gap between current competencies and future
competition is realized and resolved. The dynamic interrelation between technological competencies
and strategy indicates that a firm’s strategic vision should be dynamic as well (Vanhaverbeke &
Peeters, 2005). As a result, technological discontinuity should be explored to avoid future shock, and
foresighting is a way of seizing the opportunities, detecting and coping with problems, and it helps
create a timely response to disruptions (Battistella, 2014). Scenario planning, in particular, enables
the anticipation of less predictable future, which is a major characteristic of rare and impactful
events like the swift diffusion of radical innovations (Wright & Goodwin, 2009; Ringland, 2010).
Scenario Planning and Organizational Learning
Scenario planning grew its roots in the late 1940s when Herman Kahn discussed the concept
of “thinking the unthinkable”. Integrating the comprehensive analyses with imagination leads to
creating future-oriented stories called “scenarios” (Bradfield, Wright, Burt, Cairns & Van Der
Heijden, 2005; Chermack, Lynham & Ruona, 2001). The investigation of how organizations learn
penetrated into academia in the late 1950s (Huber, 1991). Organizational learning was defined as
a process of altering mental models (i.e., representations and assumptions about how the world
works) and processes as well as enhancing the performance of the organization (Schoemaker, Day
& Snyder, 2013). It is argued that learning will emerge when knowledge is rendered into recurring
behaviour and when the mental models and world experiences mutually adapt and integrate into
each other (Argyris & Schön, 1974; Piaget, 1997).
The process of scenario thinking fosters the organizational learning loop where sharing ideas
regarding the emerging trends, building consensus, planning, and acting take place collectively.
Double-loop learning, which is the outcome of a shared organizational mental model, creates
opportunities and provides potential solutions by reframing the problem faced in a discontinuous
development (Godet & Roubelat, 1996; Van der Heijden, 1996). Scenario planning engages in
mapping mental models, questioning mental models (i.e. norms and assumptions), and enhancing
mental models (Chermack, Lynham, & van der Merwe, 2006). Through causality the old mental
models and the new reality will integrate and create a new theory which can be tested and developed
by reflecting on the consequences of action. Scenario planning enables re-perceiving the reality, and
it leads to new and experiential learning (Wack, 1985).
Using the Futures Literacy Hybrid Strategic Scenario method, Rhisiart, Miller and Brooks
(2015) identified that two types of learning will establish through the scenario thinking process: (1)
sensemaking (i.e., generating shared and explicit meanings) and (2) anticipation (i.e., understanding
the theory and practice of foresight). Bootz (2010) differentiated between learning at the individual
level (i.e., “foresight attitudes”) which is in the cognitive domain and learning at the organizational
level (i.e., “foresight activity”) which demonstrates the interactive and participatory type of learning
within the organizations. Based on this theoretical relationship and shared characteristics and

Journal of Futures Studies
4
goals we conclude that one of the fundamental values of scenario planning / thinking is generating
profound and efficient organizational learning.
Business Ecosystems and Business Model Concepts
When discussing ecosystems, different types of ecosystems can be identified: biological,
industrial, social, and digital business (Galateanu & Avasilcai, 2013). Moore (1993) introduced
organic business ecosystems, focusing on business relationships and strategies. Moore (2006)
stated that there are parallels with business and natural ecosystems where both are partly
intentionally formed and are partly a result of accidental emergence, and they are characterized
by high complexity, interdependency, cooperation, competition, and coevolution in pursuit of new
innovations (Iansiti & Richards, 2006). In such environments it is key to integrate the analysis of
the change drivers with mapping existing and new market participants.
As an emerging field, 5G business models have only been discussed to a limited extent in the
literature. Zhang, Cheng, Gamage, Zhang, Mark and Shen (2015) discussed the cloud-assisted
business model; Noll and Chowdhury (2011) introduced collaborative business models and Rasheed,
Rodriguez, Kibilda, Piesiewicz, Verikoukis, Gregorio, Gregorio and Moreira (2015) applied the
brokerage business model in the 5G context. However, existing studies do not specifically outline
the impact of alternative future scenarios for 5G. Therefore, more research is needed regarding the
possible business models in 5G as we are approaching its commercialization.
Business models are tools that are embedded in and can contextually be formed by
technological innovation (Teece, 2010). A ‘business model’, as a mechanism for planning and
implementing strategy, enables the consideration of multiple options on an uncertain and rapidly
changing environment (Casadesus-Masanell & Ricart, 2010). In the discovery-driven approach
to business models, which aims at detecting and exploiting new models, the role of learning and
experimenting is significantly powerful. In a complex and turbulent environment, strategies require
insightfulness and instant experimentation and evolutionary learning to be effective (McGrath,
2010). For example, Ahokangas and Myllykoski (2014) discussed visioning, strategizing, practicing,
and assessing as parallel learning processes related to learning in business model creation and
transformation. Therefore, business models that are empowered by learning can be considered to
have the potential to be more sustainable and effective.
The notion of using a business model as a value creation (i.e., value proposition; e.g., product
innovation) and a value capture (i.e., profit potential, revenue logic/model) construct has been
addressed in the majority of related literature (Shafer, Smith, & Linder, 2005; Zott & Amit, 2011).
The 4C model (i.e. connection, content, context, and commerce) (Figure 1) as a taxonomy of
business models was presented by Wirtz, Schilke and Ullrich, (2010) and helps to clarify the
value creation and capture processes in the Web 2.0 context. Yrjölä, Matinmikko, Ahokangas and
Mustonen, (2016) extended the taxonomy to 5G context and saw the four business models as a
layered construct. The upper layers are being supported and enabled by lower layers. From an
individual company’s perspective, the 4C model can be practiced on single or any combination of
layers. From the ecosystemic perspective the four layers help form a coherent logic of how different
businesses in an ecosystem are interrelated (see section 4 for a detailed explanation of the model).

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Using Scenario-based Business Modelling to Explore the 5G Telecommunication Market
Provide a platform for commerce
B2B, B2C, B2G, C2C, C2B, C2G, G2B, G2G, G2C
Provide context-info-based services
Regarding users, equipment, system profile, location
Provide content
User-generated, third party owned
Provide connection
With infrastructure
Upper level
Lower level
Figure 1. The 4C Business Model in 5G context (modified from Wirtz, Schilke & Ullrich, 2010 and Yrjölä,
Matinmikko, Ahokangas & Mustonen, 2016)
Methodology
Research strategy: proposing and applying a new approach
In this research, we test a novel methodology for exploring new business fields that are both
complex and uncertain and report on its benefits. The guiding framework for our approach is the
anticipatory action learning (AAL) method which attempts to facilitate learning in a social system
(Stevenson, 2006). AAL is a democratic visioning process that connects inquiry, anticipation, and
learning with action, assessment, and decision-making (Inayatullah, 2005; 2006). The method aims
to make multiple levels of understanding merge openly and progressively during the process. AAL
underlines the pluralistic reciprocal adjustment of foresight exercises and reflects the exploration
of alternative futures (Stevenson, 2002). Both action research and action learning underline the
necessity of experimenting, reflecting, and learning (Roth & Bradbury, 2008). The participatory
approach is beneficial for visionary workshops to create innovative ideas through conceptual models
(i.e., structured intellectual procedures).
Sensemaking (Figure 2) through reflection and the analysis of the consequences of an action
leads to the improvement of individual and collective learning. Concerning the action function
of scenario process, scenario thinking empowers the organization to apply its understanding
into practice and reduces the obstructive effect of mental fragmentation and incoherent models.
Moreover, it associates the possible futures with the existing contextual environment and their
subsequent impact on the organization (Van der Heijden, 1996). In consequence, we expect that
the AAL method provides strategists with insights into plausible futures and is helpful in planning,
decision-making, and eventually shaping the future. This exploration of the future is crucial to
build a platform for anticipation (i.e., preparing one or more organizations to develop a future
market). More specifically, we expect that using the scenario planning insights to trigger business
model generation will trigger business model innovation and lay the foundation for new business
ecosystems.
Agile strategies for business modelling
Sensemaking & learning through
scenario planning
Anticipatory action learning
Figure 2. The research process

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Research Design
Case setting
The 5G technology is expected to radically change the business landscape of the mobile
communications industry, to trigger changes in the regulatory environment and alter the rules of
the game in the established markets. 5G is expected to introduce elements of the sharing economy,
change the roles and ways of doing business for the incumbent network operators, and open up
business opportunities for new entrants. The new 5G networks will accommodate a wide range of
advanced use cases with novel requirements, especially in terms of latency, resilience, coverage,
and data-transfer rates (5GPPP).
For consumers, 5G promises universal availability of instantaneous communications, a high
level of guaranteed quality of service (QoS) in indoor small cells environments, and at a cost
levels appropriate for meeting customers’ expectations. It opens up new business opportunities
by providing end-to-end network slices from the cloud to fulfil specific vertical requirements
and mobile broadband services in parallel (5GPPP). This is expected to result in a transition
from a market that is dominated by large Telco operators / MNOs towards a market supplied by
a heterogeneous set of providers with service offerings that respond to the versatile requirements
arising from different verticals such as industry 4.0. Thus, 5G is an appropriate and particularly
interesting environment to study business fields’ exploration in complex and uncertain
environments.
Research Sequence
As a first step we used the scenario planning workshop that brought different experts together to
discuss different prospections related to the context of 5G from technology, business, and regulation
perspectives. We selected the participants through an interview to ensure a comprehensive set
of relevant knowledge and experience. Participants were recruited from different value network
participants of the wireless communications ecosystem (see Table 1). The 18 participants were
organized into four groups that consisted of academic organizations and firms.
Table 1. Project participants and working group composition
Groups A B C D
Participating
companies
Huawei CWC OBS Ericsson
Ericsson Bittium CWC CWC
Nokia OBS
2)
CWC BO
3)
CWC
1)
Nokia Nokia Nokia
CWC Nokia
1)
Faculty of Information Technology and Electrical Engineering
2)
Business School
3)
Municipal organization
The participants were guided to build four alternative and plausible future scenarios for the
development of 5G markets. The scenario process was exploratory, aiming at learning, igniting
awareness, inspiring creativity, and examining the social interaction. The scenarios were set in a
three to five year timeframe, which is embedded in the rapidly changing mobile telecommunications
industry.

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Using Scenario-based Business Modelling to Explore the 5G Telecommunication Market
Scenario Planning Approach and Process
Our approach to scenario planning is prospective. Due to the context and principle of the
problem that we are coping with, it is not possible to consider only one dimension for understanding
and analysing it. Therefore, a multidisciplinary approach of systems thinking and systemic analysis
is required to capture the totality of reality with all of its variables and their interrelations regardless
of their type. Integrating systems thinking and scenario planning brings about plausible scenarios as
the causal relationship between factors can be exhibited (De Jouvenel, 2000).
For process planning, we applied the approach that typically used by Shell (2008) and Meinert
(2014) and it consists of six steps. At the starting point, the case of the scenario was created; the
participants gained understanding about the objectives and the time horizon of the scenarios (step
1: approaching the topic and time horizon). The objective was to explore what kind of impact 5G
might have on the wireless business ecosystem stakeholders within the next 3-5 years by creating
alternative future business scenarios. Then, we started from questioning the present to identify the
trends, variables, and drivers of change that will shape the future of the scenario topic. We then
selected the critical variables among those that had great impact and low predictability or unknown
consequences on the focal issue since they are the driving forces that lead to disruption (step 2:
determining critical uncertainties). Next, the relationship and interconnectedness of the variables
was analysed to formulate the possible development outcomes (step 3: creating alternatives). After
that, using a cross-impact matrix, we aligned the variables and studied the existence and strength of
their causal links. We identified the possible alternative ends (i.e. projection) of the created themes
(i.e. drivers) to create a system for navigating the future of the scenario topic (step 4: calibrating a
future compass).
Table 2 shows the four distinct scenario matrices that were built based on the identified
variables and generic envisioned features of future telecommunications industry. The vertical and
horizontal axes of a scenario matrix denote the dimensions and each dimension includes two ends
that characterize the alternative approaches within that dimension. The dimensions were assessed to
be independent of each other.
Table 2. Four scenario matrixes and their building blocks
Matrixes axes End 1 Dimensions End 2
Scenario
Matrix 1
Vertical axis Capability to create
Quality of Experience
(QoE)
User experience No QoE is required/
expected
Horizontal axis One player defined Distribution channel
selection
All players can define
Scenario
Matrix 2
Vertical axis Horizontally defined
requirements
Technology Vertically defined
requirements
Horizontal axis Static Operator role Dynamic
Scenario
Matrix 3
Vertical axis Streaming
(entertainment)
Development drive Internet of Things
(IoT) (utility)
Horizontal axis Current operator Operator business
model
Small cell operator
Scenario
Matrix 4
Vertical axis Shared Role of resources Owned
Horizontal axis Centralised Service provisioning Local

Journal of Futures Studies
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The dimensions were selected based on the ecosystem logic and how the resources are offered
and distributed within the mobile business ecosystem. Altogether, sixteen scenarios were created
based on four scenario matrices; each with two distinct dimensions. However, in order to reduce
the number of scenarios and create a generic and a more coherent scenario matrix, we merged and
integrated those dimensions (i.e. the axes of the matrixes) as well as those end points of dimensions
that were thematically and semantically similar to each other. For instance, the horizontal
dimensions such as distribution channel selection, the operator’s role, the operator’s business model
and service provisioning are all related to the “operator” theme; therefore, the created scenarios
based on these dimensions are semantically close and have common characteristics. In the same
vein, the vertical dimensions including user experience, technology, development drive and the role
of resources are related to the “content, i.e. resources” theme.
In addition, having examined the features and value of all scenarios created on the vertical
and horizontal axes, we realized that the horizontal axes are about dynamic and static market and
vertical axes are about sharing and controlling resources. For example, creating QoE, horizontal
technological solutions and streaming are not feasible without widely sharing resources within
the mobile business ecosystem. In addition, having all the players democratically participate in
the creation of the rules of the game, the emergence of local small cell operators and providing
local services are not possible without the market being opened for acting dynamically within the
ecosystem. The same justification indicates that when only one dominant player (i.e. MNO) defines
the rules, if the current situation continues without change in the future and the services are just
offered in a centralised fashion, the market remains static. In similar fashion, lack of required QoE
by customers, vertical specific technological solutions, utilizing IoT technology and keeping the
resources individually reflect the controlling attitude of the players over their resources and the
fixed structures of the ecosystem. Thus, we could merge the scenarios and build one scenario matrix
(Figure 3).
In the next step, the scenarios were written with the aim of being internally consistent entailing
cause-effect logic, being relevant to the participant’s issues of concerns and providing challenging
ideas (Heijden 2005, 225). The stories of scenarios represent four alternative futures and their
different outcomes (step 5: drafting scenario narratives for each quadrant). Finally, participants were
asked to communicate and reflect on the developed scenarios based on their plausibility, pertinence
and implication (step 6: reflecting on the end result).
As a second phase, we performed a business modelling workshop in which the aim was to
explore future 5G value-based business models for key wireless business ecosystem stakeholders.
To develop the business models, we used the 4C-layered internet business model typology (Figure 1).
Detailed Description Of the Approach and Results
Each of the four scenarios in Figure 3, which is compiled from the original 16 scenarios, is
described in the following paragraphs. The created scenarios represent different futures regarding
how the context of 5G networks and related services could unfold over time considering the
regulatory changes, business opportunities and technological innovations.
Scenario Analysis
Scenario 1: Eternal Today
Despite the increase of traffic in mobile networks due to the increasing number of new devices
with accelerating service demands, which is plausible to be the same in the future, the first scenario
assumes the continuation of the current situation. In this scenario the business ecosystem is expected
to remain as it is today with no new players, mainly due to the assumption that the regulatory
framework will not change substantially. Local small cell service offerings will increase, but the

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Using Scenario-based Business Modelling to Explore the 5G Telecommunication Market
central role of the incumbent multinational operators (MNO) will not change. MNOs provide
mobile broadband service by acting as traditional “default” bit pipes that extend their offerings to
vertical technological solutions to specific customer segments. Existing services become locally
provided but centralized by MNOs, however, with some level of service tailoring for the different
verticals. Concerning technological innovation, the infrastructure manufacturers keep on pushing
new technologies to the markets.
Scenario 2: Wild West
In the second scenario, regulation is expected to be flexible and the traditional long-term
spectrum licensing logic will be complemented with local short-term licensing models. From the
market perspective, 5G takes us to a portfolio of widely used but very fragmented services which
rest on the localization of service utilization and centralization of service provisioning. However,
the business environment becomes extremely competitive and safety, reliability, and security threats
emerge as a strong cause for concern. A variety of content-specific services will be available and
each type of content has its specific mode of monetization.
Numerous new vertical connectivity providers will emerge in the markets to compete against
each other and against traditional MNOs, and each of them prefers to control (or manage) their
customers’ information and services. The mass market for mobile broadband is fragmented due to
a wide variety of service offerings. New local operators (e.g., micro-operators) enter the market to
serve different purposes and technological needs that lead to a fragmented operator market. Due
to data density, intelligent traffic controlling systems as well as personalized delivery channels are
needed. In the industrial sectors, local vertical-specific companies will use digital services provided
through small cell networks. New vertical use cases, such as critical connectivity services in
hospitals will emerge. This scenario is based on the current recognized trends and it is probable to
happen in 5G era.
Sharing
Dominated by MNOs
Dominated by MNOs
Dominated by emerging
micro-operators
Dominated by emerging
micro-operators
Static Dynamic
4. MNOs' Law &
Order (disowned),
centralized
services, horizontal
businesses, loT
technology, flexible
regulations
1. Eternal Today
(plausible), local
& centralized
services, vertical
technologyies,
current regulatory
scheme
3.Utopia (preferred),
prosumerism,
App development
technology, light
regulations
2. Wild West
(probable),
fragmented services,
vertical technologies,
flexible regulations
Use of resources
Operators market
Figure 3. Scenario matrix for 5G networks

Journal of Futures Studies
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Scenario 3: Utopia
The third scenario describes the characteristics of a dynamic mobile market in a sharing
economy society where various resources are shared. Regulation is assumed to become only slightly
controlled and the ecosystem stakeholders can easily act within the new simplified regulatory
boundaries. Businesses within the ecosystem will become service-centric and the required resources
can be obtained on a shared basis through collaboration between the ecosystem stakeholders.
Locally tailored content provisioning emerges and can also be distributed to different segments.
Prosumerism, where the local service providers buy and sell services, will emerge. The services
are mostly content-based and different infrastructures and related services are combined to work
together. Having content and context awareness for local services requires a sharing attitude. This is
a preferred scenario based on the workshop stakeholders’ value judgments.
Scenario 4: MNOs’ Law and Order
The fourth scenario is characterized by a static market situation without the appearance of new
players, but necessary resources are shared between the stakeholders. Regulation promotes the
sharing of various resources such as spectrum and infrastructure. This scenario consists of two sub-
scenarios that describe the same world from device-centric and operator-centric perspectives. The
device and content centric sub-scenario highlights the dominance of the Internet giants who own
and sell content and the MNOs act as bit pipes in the shared world. The ecosystem is device- and
content-driven, where IoT (Internet of Things) systems’ mobile devices provide various contents. As
the level of resource sharing is assumed to be high in this scenario, new roles of resource brokerages
will emerge encompassing the knowledge of when and to whom they should provide resources,
such as spectrum. In the operator-driven sub-scenario MNOs’ platforms and interfaces control the
horizontal business/services and in 5G. MNOs may share resources but only within their comfort
zone. This scenario is customer-oriented since the inter-operation and interfaces call for more local
services. These two sub-scenarios resemble the disowned future for the workshop stakeholders.
Business Modelling
In a complex and uncertain new business field, it is prudent to analyse unbundled (i.e.
decomposed) existing business model. This is done by decomposing existing value chain positions
(e.g., network operator) into its roles in the value network (e.g., connection and data transfer
provider). For our purposes, we used the building blocks of the 4C business model typology and
explored what kind of value can be created and captured in each of the four layers.
In this model, the connectivity business model is about monetizing connectivity-services related
to network infrastructure and spectrum provisioning for information exchange and using high-speed
online services and related needs (e.g., mobile broadband and M2M communication in IoT). The
content-oriented business model builds on providing all types of online content-related services
(audio, video, text). Such content can be owned by the service provider, by third parties, or by
the user. The context-related business model monetizes the structured and aggregated information
related to the network, application, user’s profile, location, time, history data, equipment, operating
systems, and required bandwidth etc. The commerce business model builds on a platform for
buying and selling connection-, content- and context- related resources, or any combination thereof.
Different types of communication including business (B), consumer (C), and public/government (G)
can be identified and monetized in this layer (see Figure 1).
The 4C framework guides the inductive reasoning of the workshop participants. In the
workshop, participants collaboratively specified the service components for the unbundled business
model elements. The business model elements listed in Table 3, including value proposition,

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Using Scenario-based Business Modelling to Explore the 5G Telecommunication Market
differentiation, cost drivers, and ways of charging, relate to stakeholders’ value creation and capture
opportunities through service components within the 4C framework.
Table 3. Unbundled service components and their business model elements
4C mode
Business
elements
Connection Content Contest Commerce
Value Prop.
• Ease-of-use
• More connection
time for users
• Efficient porcessed
• Communication as
a service
• Inteeligent graffic
control
• Absloute capacity
matches with need
• Customer &
location data
• Superior QoS
• Tailored QoE
• Reliable & fast
local content or
customized content
• Context sensitivity
• Profiling of users
• Flexible deivery
• Low transaction
costs
• Pay for what you
use
• Low cost
connectivity
anywhere
Differentlation
• User experience
• Apps
• Services that others
do not have
• Optiomized
anytimes &
anywhere (for end
user)
• Simplified &
cost effective
distribution (for
content porviders)
• Shared investment
cost including
OPEX
• Network extensions
to MNOs
• One "network"
indoor coverage
• Known customer-
base for 5G service
• Technical
superiority
• Local services
• Communication
• Personalization
• Relevance of
service
• Unlimited portfolio
of services
• Local vs.
Centralized
commerce
• Low transaction
costs
Cost drivers
• OPEX (operating
expenses) control/
reduction
• Capacity &
coverage
• Device (operating
systems)
• System complexity
and infrastructure
cost
• Shared spectrum
cost
• Fewer cashpoints
• Less advertising
• Shortened
processes
• Aggregation &
organization of
online information
• Date security
• Big data analytics
• Profiling of users
• Cloud service
Ways of charging
• Monthly
subscription (SIM,
HW + Services)
• Varies by customer
• Device
• Bonus account
• Free of charge
• Bonus schemes
• B2B billing
• Licence price
• Fixed price
• Customized
monetizing
In this step, we purposely avoid matching the business model elements with their role in the
value network, to ensure that participants are not affected by biases. In particular it needs to be
avoided that participants start focussing on protecting their current position in the value network and
consequently reduce the options that are being discussed.
In the next step, we re-induce the uncertainty through bringing the four scenarios back into
the process. While the scenarios are vital to prevent participants to mentally fall into established

Journal of Futures Studies
12
representations and mental models, we need in this step also to drive the convergence of the market
exploration insights. The rationale is that the convergence is necessary to lay the foundation for
action, but that it needs to be achieved in a way that does not compromise the open exploration
process of new business and market configurations.
We achieve this by identifying business model elements that are suitable to be applied in a
given scenario. This process resembles analogical reasoning through which creation / mapping of
knowledge (e.g. distinguishing patterns) from a familiar domain to a novel or less familiar domain
takes place. This leads to choice setting and forming a new relational setting (Martins, Rindova &
Greenbaum, 2015). In that way, the attention from the strategists is focussed on the cognitive task
of finding an optimal business model in a given environment and hence distracted of protecting for
example their own competitive position in the market. This kind of cognitive mapping (i.e. analogy)
make decision-makers to be more aware of their own and other’s subjective belief, therefore, it
alters / facilitates the decision-making process (Swan, 1997). The results of this activity are depicted
in Table 4.
Table 4. The overview of scenarios and their 4C layers
5G Ecosystem
4C MBs
Scenarios Connection Content Context Commerce Key actors in
each scenario
Scenario 1:
Eternal Today
Technology-
oriented
MNOs dominant
• Mobile
broadband as
offered today
• Data &
usesr density
monetized
• Subscription
based
• Advertisements
• Bonus
• Device
manufacturers
• Network
equipment
• Spectrum &
infrastructure
owners
Scenario 2:
Wild West
Service-oriented
Micro-operators
dominant
• Enabling
mobile
broadband
offering in
fragmented
markets /
environments
• Vertical
technological
solutions
• Customized
services
• Content owners
& aggregators
• Application
providers
• System
integrators
Scenario 3:
Utopia
Service &
technology
oriented
Micro-operators
dominant
• Guaranteeing
mobile
broadband
offering through
sharing
• Multiple apps
• Local content
services
• Profiling of
users
• Context defined
content services
• Combination
of scenario 1
& 2 actors, i.e.
professional
service
providers
Scenario 4:
MNOs’ Law &
Order
Regulatory &
service oriented
MNOs dominant
• Full coverage
(by MNOs)
throught
spectrum
provisioning
• IoT devices
• Superior QoS
• Customer
specific
services
• License prices
• Suctioning of
spectrum
• Cloud-based
B2B
• Government,
regulation
authorities &
standardization
groups
5G specific value creation & capture

13
Using Scenario-based Business Modelling to Explore the 5G Telecommunication Market
The key insights are that in the technology-oriented Eternal Today scenario, MNOs have a
dominant role and network infrastructure vendors and device vendors are expected to complement
the ecosystem. Connectivity (mobile broadband), context (data and user density monetized), and
commerce (with advertisements or bonus schemes) business models may provide most of the new
value added in the ecosystem.
The Wild West scenario is more service-oriented and showed the emergence of micro-operators
as new key players for providing mobile broadband as a local service. The dominating business
models monetize the mobile connection locally (by micro-operators) and vertical-specific,
customized technological solutions and content services. When comparing to the Eternal Today
scenario, the role of the content owners, the content aggregators, the application providers, and the
micro-operators is more pronounced.
The Utopia scenario is both service- and technology-oriented. It is dominated by emerging
micro-operators who create and capture value through connectivity, content and context, but which
are reliant on MNOs’ resources. A variety of micro-operators provide services professionally for
all kinds of customers locally (i.e. in selected verticals) and MNOs provide micro-operators the
required connectivity to other networks and the Internet. In addition, context-defined content
services for profiled users, or local content, provide the main competitive advantage. Furthermore,
the sharing of infrastructure plays an important role in this scenario.
The MNOs’ Law and Order scenario is service- and regulation-oriented; it is dominated by
MNOs. Connection, content, and commerce business models are the main ways of doing business.
In this scenario, the future 5G regulatory policy is concerned with improving the efficiency of
spectrum use rather than opening the market to a more versatile set of players through local
spectrum access rights to increase competition. As new market players are not expected to emerge,
the local services market can be expected to be divided between device/content and MNO/
connectivity fragments.
Overall, the scenario and business model planning exercise highlighted the key role of
regulation, which is expected to be flexible in three latter scenarios whereof the third scenario goes
the furthest by assuming the opening up of the market for dynamic operations as well as sharing
of various resources. The second key factor is the service provisioning, which reflects on whether
it is ideal to move towards sharing and dynamic activities between the operators and whether that
sharing occurs between MNOs or between local operators. Technology is a substantial driver of all
scenarios, but its importance does not vary between the scenarios.
Conclusion
Innovative technologies like 5G will call for novel business models for the deployment of
resources and capabilities; ability to strategically adjust resources to demands and creating value
proposition opportunities within a rich ecosystem of service providers. Moreover, it is crucial to be
agile and resilient to environmental uncertainty and complexity. Business models demonstrate the
mental models and schemas of the managers (Martins, Rindova, & Greenbaum, 2015) and they are
an abstract conceptualization that pertains to sensemaking and can map and facilitate the possible or
necessary changes based on the new conditions which lead to innovation and competitive advantage
(Morris, Schindehutte, Richardson, & Allen, 2006).
With this paper we aimed to contribute to a better understanding and ultimately better execution
in the development of new markets in environments that are characterized by high levels of
volatility, uncertainty, complexity, and ambiguity known as VUCA. Entering such environments
as a firm holds the promise for superior profitability and growth. Entering such environments as

Journal of Futures Studies
14
societies is necessary to overcome grand challenges such as climate change, water scarcity, and
limited natural resources.
Delivering on the promise of superior profitability and growth and answering successfully to
societal challenges require overcoming bounded rationality. The ability of the managers is limited in
anticipating and responding to changing environment; they are unable to re-think before the strategic
change happens and re-perceive the environment in a novel and different way (Patel, 2016). Solving
this requires that decision-makers, to which we also refer to as strategists, identify superior courses
of action by altering mental models, creating new shared and powerful representations (Gavetti
& Menon, 2016). We expected that this can be supported by methods and approaches of strategic
foresight (Rohrbeck & Kallehave, 2012) like scenario planning that enables reducing cognitive
distance that can be the consequence of lack of previous knowledge; revising the taken for granted
previous assumption, deepening the awareness and enhancing the attentiveness to the dynamic
environment and alternative choices (Patel, 2016). Revised assumptions and updated anticipation is
comparable to adjusting the cognitive scripts, i.e. logical and consistent chain of actions expected by
individuals.
It is crucially important to know how the events that appear significant to us should be selected
and put together as they are unfolding over time (Louis, 1980). In this research, we address
this importance by designing and testing a novel approach that combines scenario planning
with business modelling (i.e. strategically think through scenarios and strategically act through
business models) for collaborative exploration of a future market that is significantly altered by a
technological disruption. We applied our novel approach in the context of mobile telephony market,
which will face an important transition, when the 5
th
generation standards are being introduced. We
conclude that even with working with incumbent market participants, we have been able to create
representations that are significantly different from the status quo (the scenarios). We further find
that these representations were powerful and tangible enough to work as a platform for defining
business models. Using the dynamics of the process and by forming working groups consisting
of participants from different places in the value network, we were successful in preventing the
participants from falling into established cognitive patterns.
To gain a better understanding of suitable method combinations in different environments, more
studies are needed that apply combined approaches in different contexts. In addition, it would be
beneficial to control for cognitive biases and how the approaches contribute to their reduction.
By inducing plurality through the scenarios, it permitted to trigger and host a strategic
sensemaking that overcame established mental models and led to prospective and shared
representations among the participants (Wack, 1985; Schoemaker, 1995). We came to the conclusion
that our approach contributed to prevent frame blindness and facilitates learning from retrospection
(Choo, 1996). Storytelling and theory building enhance the participants’ interactions while they are
sharing their perception of the environment. Stories that individuals tell about the future illustrate
the individuals’ worldviews and this narration results in discovering the stories (i.e. mental models)
that are tailored to specific needs and accelerates the desired future. It deconstructs and reconstructs
the understanding of the uncertainty and risk and challenges the underlying assumptions and
ultimately fills the gap between desired future and the existing realities (Milojević & Inayatullah,
2015). This process grows the creativity and intellectual capability of the participants. Learning
occurs while participants iteratively shape and define the future while considering that they would
be affected by the consequences of the future that they are envisioning (Inayatullah, 2005).
Finally, we have documented that our approach led to the emergence of two kinds of outcomes:
first, the creation of alternative pathways to multiple plausible futures and, second, integrating
exploration-oriented foresight methods like scenario planning with planning-oriented business
modelling techniques, are boosting both insight and likelihood of meaningful action. Scenario

15
Using Scenario-based Business Modelling to Explore the 5G Telecommunication Market
planning and business modelling are both involved in mapping, i.e. detecting driving factors and
envisioning alternative possibilities and entail cognitive, collaborative and collective processes to
create and develop knowledge for the purpose of strategizing and planning. We expect that such
tailored combinations of methods will play an increasingly important role in collaborative market
exploration, creating value both on a firm and societal level.
Acknowledgements
This work is supported by Tekes - the Finnish Funding Agency for Technology and Innovation.
The authors would like to acknowledge the JointMacs (Joint Network and Market Design for
Content and Spectrum Sharing in Future 5G Networks) project consortium.
Correspondence
Sara Moqaddamerad
Martti Ahtisaari Institute
Oulu Business School
University of Oulu
Pentti Kaiteran Katu 1, Linnanmaa, FI-90014, P.O. Box 8000, Oulu
Finland
E-mail: Sara.Moqaddamerad@oulu.fi
Petri Ahokangas
Martti Ahtisaari Institute
Oulu Business School
University of Oulu
Pentti Kaiteran Katu 1, Linnanmaa, FI-90014, P.O. Box 8000, Oulu
Finland
E-mail: Petri.Ahokangas@oulu.fi
Marja Matinmikko
Centre for Wireless Communication
Faculty of Information Technology and Electrical Engineering
University of Oulu
Pentti Kaiteran Katu 1, Linnanmaa, FI-90014, P.O. Box 8000, Oulu
Finland
E-mail: Marja.Matinmikko@oulu.fi
René Rohrbeck
Department of Management
Aarhus University, Aarhus, Denmark
Department of Business Development and Technology
Aarhus University, Herning, Denmark
Bartholings Allé 10, 8000 Aarhus C, Denmark.
E-mail: rrohr@mgmt.au.dk

Journal of Futures Studies
16
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