As mobile industry analysts, we are always split when a new generation of technology looms. With 5G, as with 3G and 4G, there is the temptation to focus entirely on the emerging platforms, because there is so much attention and curiosity focused on the big questions of standards, spectrum and potential business cases. But while the media and most companies’ boards obsess about 5G, the majority of executives with real network and business responsibility remain primarily focused on the realities of today.
Rethink Technology Research, the source of Real Wireless market data, has built a unique research base of senior executives in over 100 mobile operator firms around the world. In its most recent survey, it emerged that only 8% of the companies planned to embark on 5G before 2020, and they accepted that their deployments would, of necessity, be partly pre-standard, which means expensive and hand-crafted.
The majority of operators will wait until after 2022 to deploy 5G at scale, and will focus in the meantime on squeezing as much life as they can out of LTE. For companies which will remain focused on mobile broadband as their primary business model for the foreseeable future – and despite all the hype about the Internet of Things, those are the overwhelming bulk of mobile carriers – there is a great deal of life left in 4G. Arguably, if there is no urgent requirement to move towards new use cases like fixed broadband or massive machine-to-machine connectivity, LTE-Advanced should suffice for many years. Even 5G early movers like NTT Docomo are saying that they expect to enhance their 4G networks for a decade after 5G is first switched on.
So many elements need to be in place before 5G is really a mainstream option for most operators. The actual radio standard is perhaps the least of these and there are already indications of what the 3GPP New Radio will look like. More thorny are the transition to a virtualized and software-defined architecture – a prelude to 5G for about two-thirds of tier 1 operators, our survey discovered – and creating appropriate spectrum and regulatory environments. And that is before operators can seriously start to evaluate the brand new use cases which will be essential to justify investing in a new generation of technology when the current one is still in the prime of its life.
Of all the issues which surround 5G, the spectrum situation is the furthest from being resolved in any harmonious way. The ITU’s next World Radio Conference, which will set overall allocations for 5G, does not take place until 2019. Meanwhile, some regulators, like the US FCC, are storming ahead with opening up new high frequency bands, which will be valuable for supporting use cases which require ultra-dense small cell networks. But there is little international harmony, and a concerning tendency to discuss these high capacity bands in the same old terms of auctions and exclusive licences.
At the same time, Google is pushing for a far more open approach with unlicensed, shared and dynamically allocated spectrum regimes taking over from licensing, even as Facebook throws a grenade at the traditional network equipment ecosystem with its open source Telecoms Infra Project. In these cases, the web giants are pointing to the future while too many regulators and operators stick their heads in the sand. Open source hardware and software and flexible spectrum regimes will be far more important than the actual radio for 5G to achieve its hugely broad-ranging objectives. The mobile operators still have a chance to share in that success, but only if they adopt 5G for sound commercial reasons, at the appropriate time, and in the meantime, recognize that the real change they must embrace is one of ecosystem and openness, not radio technology.