NEW ANALYSIS: In June 2016 Tom Wheeler, the chairman of the Federal Communications Commission in the US, presented his vision for 5G and “why American leadership in 5G must be a national priority”.
Other countries, most notably Australia, China, Japan and South Korea, are also aggressively pursing 5G for similar reasons. Japan plans to showcase 5G at the 2020 Tokyo Olympics and Australia at the 2018 Commonwealth Games. Mobile operators in China, Korea and the US are already trialling 5G with the objective of being first to market with commercial services using pre-standard technology.
The mobile industry has a vested interest in promoting 5G to buoy stagnant service revenues and declining 4G network expenditures. With 5G technology vendors including Ericsson, Huawei and Nokia hope to drive equipment sales, and operators aim to increase network value with heightened scalability, throughput, latency and reliability.
Combined, the vested interests of mobile industry players and nation states are strong catalysts to fuel 5G sentiment and skew market reality even though compelling 5G business cases are conspicuously absent. 5G targets several specific use-cases including enhanced mobile broadband (EMB), ultra-low latency and mission critical connectivity, and network slicing capabilities to segment resources according to service demands.
Enhanced broadband, with caveats
To enable EMB, 5G aggregates wide radio channels in sub-6GHz spectrum or harvests spectrum in higher frequency bands between 10GHz and 100GHz (mmWave and cmWave). EMB capabilities are being touted for the mobilisation of high-resolution 4K and 8K video services, but not without challenges. In particular, if EMB is delivered:
• using mmWave and cmWave technology, coverage will be generally constrained to small cell ranges with limited mobility, or;
• through sub-6GHz spectrum aggregation, service economics will be challenged in capacity constrained environments. Furthermore, 4G technology advancements with what the industry refers to as 4.5G and 4.9G are using spectrum aggregation techniques to deliver tremendous peak data rate capabilities. These capabilities are likely to eclipse 5G solutions based on sub-6GHz spectrum.
Traditional telephony services require connection latencies in the order of 100m/s and LTE-Advanced is capable of achieving 10m/s connection latencies, which are adequate for most applications. However, other applications such as those for autonomous vehicle connectivity and the tactile internet require connection latencies in the order of 1m/s, which is being enabled by 5G. The tactile internet spans a broad range of nascent services with complex value chains such as entertainment, transportation, industrial operations and healthcare – including ominous applications such as remote surgery.
Companies like Magic Leap, Metaio, Gravity Jack and Darqui are delivering tremendous innovations with augmented reality (AR), which we believe will be important drivers for tactile internet applications. However, today it is unclear if and when these players will require 5G capabilities.
Push by automakers
Industry heavyweights like Google and the automotive industry as a whole have been making significant headway with autonomous vehicle capabilities including vehicle platooning, which requires low latency vehicle-to-vehicle (V2V) and vehicle to infrastructure (V2X) connectivity. While this is well suited to 5G, the automotive industry already developed dedicated short-range communications (DSRC) for low-latency V2V and V2X connectivity – albeit with relatively low data rates.
While mobile industry advocates are promoting 5G as an alternative to DRSC, many automotive industry players are suggesting DRSC be used for low-latency connectivity and mobile broadband technologies for high-bandwidth in-vehicle infotainment solutions. If this approach were adopted, the low-latency capabilities for 5G would not be required.
For many years mobile players have anticipated market upside opportunities by offering priority network capacity at a premium. While a compelling concept, priority access is difficult to achieve at scale with current network technologies. This is particularly the case when there is the need to dynamically dedicate network resources for mission critical applications such as those associated with public safety. As a result, many dedicated public safety networks, such as FirstNet in the US, are being deployed using LTE.
Priority network access is inherent in the design of 5G, to the extent that it is even incorporated in the proposed radio waveform. With these capabilities, commercial 5G networks can be reliably designed to prioritise mission critical functionality, such as public safety. However, since mission critical network designers are necessarily conservative, we believe it will take many years before 5G solutions are accepted as an alternative to dedicated LTE networks.
The Internet of Things (IoT) is expected to proliferate in coming years and herald a massive growth in the number of connected devices. Traditional cellular technologies designed for mobile users are constrained in terms of the number of devices each base station can support, and incorporate unwieldy core network functionality which is not required for machine-type communications. However, low-power wide-area (LPWA) network technologies such as Ingenu, and 3GPP standards including LTE-M1 and M2, have been modified to support massive connection densities, with significant improvements in device energy efficiencies.
5G standards intend to support more than one million devices per base station, which corresponds to between 20,000 and 40,000 simultaneously connected devices per square mile. While we expect the number of connected devices to increase dramatically over the coming years we do not believe 5G is necessarily required. Instead, LPWA and LTE-M1 and M2 technologies are currently adequate and will be improved as device densities increase.
Devil’s in the detail
By capitalising on advancements with network virtualisation and resource orchestration, the 5G standards introduce a concept commonly referred to as network slicing. With 5G network slicing, end-to-end network resources can be allocated according to specific service and user demands. We believe this is a compelling feature of 5G. However, it is difficult to implement in practice given the complexities in business and operational support systems and the heterogeneous network environments over which services will be delivered for the foreseeable future.
When evaluating the prospects for 5G it is tempting to focus on its role in extending the success of 4G rather than the potential for it to miss market expectations as was experienced with 3G. In some markets like the US, Korea and Japan where consumer “techno-lust” is prevalent, mobile operators are likely to benefit from targeted 5G deployments. However, in most markets we believe operators don’t necessarily benefit from being first-movers in 5G and should have measured and pragmatic 5G implementation strategies.
By Phil Marshall, chief research officer at Tolaga Research
The editorial views expressed in this article are solely those of the author and will not necessarily reflect the views of the GSMA, its Members or Associate Members.