5G: A triumph of hype over expectation?
A primer on 5G, when it will be deployed and what difference it is likely to make
The 5G future is closer than you think. That’s the headline on a recent article by Charla Rath, Verizon’s vice president of wireless policy development. Verizon isn’t the only one heralding the dawn of 5G. Both vendors and telcos are increasingly talking about tests, trials and timeframes for commercial deployments.
But what exactly are these companies talking about? And is it more than just talk? When will 5G be deployed in earnest? And does the world really need 5G any time soon?
What does 5G actually mean?
At this point, 5G is best described as a set of aspirations. Some of the component technologies are still being developed, never mind standardized. But don’t dismiss 5G as blue sky thinking. This new generation of cellular technologies is developing fast. Moreover, the (very ambitious) requirements agreed by the operator-led Next Generation Mobile Networks (NGMN) group give a clear steer on where the cellular industry is headed and how mobile technologies could further transform our personal and professional lives.
In a white paper published in February 2015, NGMN said that 5G should be at least 10-times as fast as the 100 Mbps average supported by 3GPP Release-12 (the LTE Advanced technology standardized in March 2015). In other words, 5G should deliver at least 1 Gbps – fast enough to download a 720p High Definition TV episode in eight seconds. More radically, NGMN stipulated that latency should decrease tenfold, taking it below 5 milliseconds for a typical application, while allowing for a 100-fold increase in the number of active connections in a cell – the equivalent of 200,000 active connections in every square kilometer.
If 5G were to meet these core requirements, it could be a game changer for the Industrial Internet of Things (IoT) – very low latencies would help to provide enterprises with fingertip control over remote machinery vehicles and devices. Furthermore, the ability to support tens of thousands of connections per cell would enable far more precise monitoring of machinery and agriculture than is the case today The graphic below (from GSMA Intelligence) shows how the demanding latency and bandwidth requirements of some IoT applications.
Moreover, 5G could give telcos and their customers much more precise control over how the bandwidth available is actually used. For example, Nokia says network slicing technology could transform a single physical network into “a multi-service fabric” that precisely meets the capacity needs and service requirements of a multitude of industries from automotive to healthcare to energy, while also optimizing overall performance. This could be achieved by creating virtualized instances across the radio, core and transport parts of the network dedicated to specific applications. Nokia says it can already demonstrate how 5G can support a million device connections on a single cell, together with a near zero delay, to enable industrial automation and the control of vehicles.
But some commentators are skeptical about how 5G will perform in real-world conditions. Dan Warren, director of group architecture at Capita and former director of technology for the GSMA, notes that many factors, such as the need for interconnection, video codec frame rates and the geographic distances involved, will make it very difficult to achieve latencies of below 10 milliseconds.
When will 5G be deployed in earnest?
Both analyst firms and vendors see 5G really coming of age from 2020 onwards, but there are wide differences of opinion on how fast the market will grow. Juniper Research reckons 5G service revenues will reach $65 billion in 2025. ABI Research is much more aggressive, putting 5G service revenues at $247 billion in 2025.
Ericsson, which has said there will be 150 million 5G subscribers as early as 2021, has agreements with 21 mobile operators, including AT&T, China Mobile, SK Telecom, TeliaSonera, T-Mobile US and Verizon, to work on 5G technology. “Nokia has been working on 5G technologies and architectural principles for almost a decade,” adds Marcus Weldon, president of Nokia Bell Labs and Nokia CTO. “We are working with operators to create pre-standard implementations and will start trialing 5G networks in 2017 to test performance and new business models.”
Huawei and NTT DOCOMO completed field trials of 5G access technologies in October last year, achieving throughput speeds of up to 3.6 Gbps. At the end of March, SK Telecom and Samsung announced that they had successfully tested 5G in the 28 GHz band at a test bed in Bundang.
Verizon CFO Fran Shammo has said 5G technology could even be launched commercially as early as next year in the U.S., if the FCC were to make ultra high-band spectrum available. Shammo said a test van is already travelling around Verizon’s headquarters delivering service with speeds of up to 1 Gbps to the building. “The technology is there, it works,” Shammo told a conference organized by Morgan Stanley in March. “We don’t have to wait until 2020… the technology itself, we believe, could be commercially launched sometime in 2017.”
However, the availability of spectrum isn’t the only potential stumbling block. “We still have to work out the business case for it,” Shammo acknowledged. “Candidly…5G has the capability to be a substitute for broadband into the home with a fixed wireless solution. The question is can you deploy that technology and actually make money at a price that the consumer would pay?” Verizon’s biggest rival, AT&T, plans to begin its first trials this year, in conjunction with Ericsson and Intel.
Telcos and vendors alike are working towards cementing the first official 5G standards in 2018. Verizon has teamed up with SK Telecom, NTT DOCOMO and KT to form a global initiative called the 5G Open Trial Specification Alliance. This alliance plans to develop an aligned 5G trial specification that would serve as consistent platform for different 5G pilots around the world.
Why the urgency?
Enterprises in other sectors may wonder whether all this 5G activity is driven by the mobile industry’s need to rekindle growth, rather than demand from carriers’ customers. With 4G technology improving fast and 4.5G networks now being deployed, is 5G really needed any time soon?
The answer to that is likely to depend on how fast existing wireless networks, which are constrained by the capacity of the spectrum they use and the efficiency of 4G technologies, max out. A new report by Bell Labs Consulting, a division of Nokia Bell Labs, claims that only 81% of demand for global data (traffic) in 2020 will be met unless the deployment of 5G networks is accelerated.