What does 5G herald for the region?
By Edwin Yapp June 28, 2017
- Mobile World Congress Asia kicks off focused on 5G
- Need to balance hype, reality as 5G is still some ways off
EVERY 10 years or so, mobile technology gets refreshed. In the early days, digital mobile telephony – also known as GSM or second generation (2G) came to Malaysia in 1994. About 10 years later, vendors were touting third generation (3G) mobile telephony, and 10 years after that, the market began talking about fourth generation (4G).
By extrapolating this somewhat oversimplified formula, fifth generation (5G) should arrive in 2023/ 2024.
But that isn’t the case, as vendors are already drumming up the notion of 5G coming to town as early as 2018 in some limited way in advanced markets, including the United States, Japan and South Korea. Vendors are optimistic that adoption will pick up quickly from then on.
Case in point: According to Swedish vendor Ericsson, the world will see more than half a billion 5G subscriptions worldwide by 2022, covering about 15% of the global population.
North America was projected to lead the adoption of this new technology, with 25% of mobile subscriptions set to be 5G by 2022, noted its latest Mobility Report released in June. This was expected to be followed by Asia Pacific with 10%, it added.
In Japan, telcos and other corporations are racing to commercialise fifth-generation mobile technology ahead of the 2020 Tokyo Olympics, reports the Nikkei Asian Review.
The business daily also noted that drones, in conjunction with 4K-ready cameras, artificial intelligence (AI) and smartphones, are being tested for use at the game’s opening ceremony.
Similarly, South Korea’s KT Corp (KT), the official network partner for the PyeongChang Winter Olympic Games next year in Korea, will offer 5G trial services during the Games. Together with another major player, SK Telecom, both operators have already announced goals to commercialise the 5G network by 2019.
The GSMA (GSM Association), organiser of this week’s ongoing Mobile World Congress Asia in Shanghai and from which I’m reporting on this week, is a little more conservative predicting that commercial 5G networks will only begin to be widely deployed at the start of the next decade and, by 2025, will provide coverage to a third of the world’s population. Its report noted that 5G connections are forecast to reach 1.1 billion by 2025, accounting for approximately one in eight mobile connections worldwide by this time.
I get it. Hype always precedes reality.
In the days of the transition between 2G and 3G it was like this. Malaysia first issued licences for 3G approximately in 2002/ 2003 but only really got going in 2005/ 2006. Similarly, from 3G to 4G, it took three to four years to really gain traction.
So is 5G going to come soon? Some believe 5G should come sooner rather than later while others remain more cautious.
Take Todd Ashton, head of Ericsson Malaysia and Sri Lanka, for example. In an interview with Digital News Asia (DNA) last year, Ashton said that despite the advent of 5G, the Internet of Things (IoT) and the cloud, and digital disruption coming to every industry in Malaysia, the country is still caught up in 4G mode.
Arguing that many emerging technologies can be better enabled by 5G, such as the IoT, Ashton said, “There’s still a lot opportunity and things to be done on 4G and a lot of industries will connect via 4G first. But it’s a big deal for Malaysia where it should start thinking about 5G.”
That may be wishful thinking, for when asked when he thought 5G will finally arrive in Malaysia, he conceded, saying: “For sure it will be after 2020. The first ones you will see having 5G are probably South Korea, Japan and the United States.”
On the more cautious camp were analysts, who believe, like me, that any gestation period of a new technology is going to take up to five years to really become widespread.
For example, Frost and Sullivan’s principal, Quah Mei Lee, said in an opinion piece recently that conventional wisdom dictates that 5G would only arrive between 2019 and 2020, but was quick to add that it may be between 2023 and 2025 before it really materialises.
“Vendors and operators try to leverage the 5G limelight at conferences,” she writes in an opinion piece. 5G will be big in developed countries such as South Korea and Japan and also in developing countries such as China and India, she adds.
But operators, she argued, have different considerations.
“They see saturated markets, increased competition, and declining revenues and/or profitability - especially from traditional core services. These operators are under pressure to seek cost-reductions and revenue streams derived from innovative new services.”
Also, fitting 5G efficiently into operators’ existing networks (2G/3G/4G) and services portfolio while managing the necessary customer migration will be an issue, she argued.
“5G will require operators to implement site diversification and more efficient use of network assets like spectrum,” she said. “In summary, without even going into the details, it is clear that there will be some fundamental shifts in the industry as a result of 5G.”
She’s not alone for Analysys Mason principal analyst Stephen Wilson concurs. In an email response to DNA’s queries on 5G, Wilson said there remains a good deal of uncertainty around investing heavily in a new technology in a challenging business environment for global MNOs.
For me, spectrum is one area of uncertainty around 5G, as there need to be new bands allocated for 5G. The ones that are gaining attention now are frequencies around 3,500 MHz and in the lower C-band spectrum of up to 4,200 MHz, as they promise higher bandwidth and capacity than the sub-3,000MHz bands. There are also some early 5G trials are focused on spectrum at 28,000 MHz band.
Wilson said one option would be to use millimetre wave spectrum but the cell range for such high frequencies is low and this will mean significant investments will need to be made in fibre backhaul.
Wilson argued that in general further spectrum releases will be required to meet the growing demand in traffic and the launch of 5G. He added that a further area of uncertainty is with regard to the value of 5G IoT.
“IoT forms an important part of the 5G vision but it is unclear at this point which IoT applications will actually require 5G as opposed to existing IoT technologies,” he said.
What to expect
Technically speaking, 5G promises 50 to 100 times faster transmission speeds compared with what’s available on 4G today. Also, it will boast of less than one millisecond latency – the ability of the signal to get from one point to another – compared with 20 to 30 milliseconds on 4G today.
So in terms of technology, there are benefits to 5G. But the real question is where do we find the balance between hype and reality?
My own personal sense is that while vendors continue to beat the drums in support of 5G, operators will continue to be cautious in advertising that they’re adopting 5G. The one good thing that came out of the transition between 3G to 4G for Malaysia operators is that they were more measured in how they set the expectations for the consumers.
When moving from 3G to 4G, all the operators did not go to town with their respective announcements and kept the rhetoric to the minimum. I believe this was a good thing and that this will be the same modus operandi when they go from 4G to 5G
Which brings me to my expectations at this conference. As I head out to the event, the main takeaway for me will be a conference panel on 5G Industry Summit -- sponsored by Chinese telco gear maker ZTE --where experts from operators, industry organisations, chipset providers are expected to discuss 5G ecosystem collaboration, technology innovation and commercialisations as well as applications in vertical industries.
It would be good to hear from these experts how much hype is being drummed up versus how realistic things really are on the ground.
Another interesting panel for me to glean from would be the economic impact of 5G on society and people. For instance, would cyber-warfare destroy a country’s infrastructure? Would mass unemployment be the order of the day as AI and robots become more commonplace? Or even civil unrest in a ‘post-truth era’?
Interesting topics to consider. So my hope is that this conference will be more informative rather than just mere hype. Stay tuned for more in the coming days.
Edwin Yapp reports from the Mobile World Congress Asia in Shanghai at the invitation of ZTE Corp. All editorials are independent.