When it comes to 5G, there are arguably more unknowns than knowns. Speeds will be faster and increased densification of sites will be required but how will this be achieved, how will it be monetised and what will be the implications on stakeholders in today’s market? As stakeholders search for clarification and answers, The Future Network reports back on the top 20 viewpoints and premonitions shared during December’s roundtable discussion.
Predictions and forecasts surrounding 5G and its impact on telecoms infrastructure
1. Asia will see the first 5G deployments: Along with the USA; Japan and South Korea will be two markets where 5G is first to be rolled out with a general consensus that deployments will start in 2019 with the first systems online in 2020
2. More sites will be required: Increased densification of sites is universally recognised as being fundamental to the deployment of 5G
3. MNOs are still trying to work out use cases that make 5G make sense: It is essential that MNOs find ways to generate incremental revenue in order to offset the cost of 5G deployment. Driverless cars are widely being touted as one of the key use cases, although many feel this was a way off; additionally opportunities for MNOs in the content space exist but it is a tough game
4. Question marks exist over whether 5G is essential for many IoT applications: People talk a lot about 5G and IoT but many IoT solutions can actually work across 2G technology thus negating the requirement to upgrade networks
5. Frequency allocations likely to be 3.5GHz: Whilst it remained to be seen what the frequency allocations for 5G will be, 3.5GHz was the most commonly cited frequency that is likely to be used.
6. Rural deployment of 5G will depend on whether 700MHz spectrum is allocated: Whether 5G will be rolled out in rural areas people thought was dependent on whether lower frequency spectrum would be allocated to the technlogy. 700MHz spectrum was seen as being the most useful and without it, it would be difficult to make a case for 5G
7. Fibrisation of towers will be of paramount importance: Provision of backhaul is a must in enabling 5G deployment, and fibrisation of towers will play a big part in this. Some work around fibrisation of towers has already been done during 4G deployment but more is required. There is a strong role for towercos in the fibre space with Crown Castle in the US and towercos in Indonesia already starting to get involved and offer fibre as a value added service. For the time being, it was thought that towercos would only be looking at fibre in urban areas
8. Street furniture will be key: With a requirement to densify, obtaining the rights to street furniture will be a key tactic in rolling out 5G in urban areas
9. There will be a lot of trial and error long the way: The business model for 5G rollout is far from defined and participants felt that there would be a lot of trial and error and water under the bridge as stakeholders strive towards a model that works
10. New types of companies will emerge as competitors to traditional players: Participants from outside of the existing industry are likely to start to play a role in the deployment of 5G, with entities which are working on land banking sites likely to be one such key stakeholder in the future
11. Further MNO consolidation is likely: With the investment required for 5G, it is likely that we will see further MNO consolidation in developed markets leading to no more than three of four players present in any given market
12. As new companies delve into fibre and small cells, regulatory issues will arise: Having solely operated passive equipment in the past, in many markets towercos have been outside of regulation. As infracos look towards fibre and small cells some regulators stipulate that new licenses will be required
13. The right balance of integration testing needs to be struck for open protocol base stations: Under open protocol, whilst different equipment can be put together in a base station it is important to ensure that this works efficiently as a unit. Whilst such testing is important, putting too much expenditure into testing pushes up the cost of the unit which hampers the economics that open protocol is trying to achieve
14. Antenna will have higher power requirements: Due to the high frequencies likely to be allocated to 5G, there will be higher energy consumption by the antenna which could create challenges, not least due to increased opex
15. MNOs could look at sharing antenna to reduce costs: Whilst regulatory issues need to be overcome, MNOs may look toward shared antenna in a bid to control the capex surrounding 5G deployment
16. The step between 4G and 5G is less obvious than 2G-3G or 3G-4G: The difference in capability moving from 2G to 3G was obvious. Whist the step from 3G to 4G was less clear, the difference was in the devices: as the iPhone came to market suddenly 3G data speeds weren’t enough. With 5G there is a feeling that people are already happy enough with the 4G speeds that they are receiving
17. In markets where 4G enhanced exists it is likely to delay 5G rollout: With 4G enhanced delivering an improved offering on top of 4G, markets where the technology exists would be likely to see a delay in the adoption of 5G
18. Once the first movers move, 5G deployment will be an arms race: Deployment of 5G by one MNO is likely to spur its competitors into deployment, even if the economics do not yet fully stack up
19. Margins will be squeezed across the value chain: Due to the high cost of deployment, it is inevitable that MNOs will continue to squeeze their suppliers and partners for price reductions from everything from the price of hardware from vendors to rents paid to towercos
20. Small cells aren’t yet a tried and tested solution: There have been announcements in the US in the past couple of weeks that small cells haven’t been working for MNOs in the country, further technological enhancements are required
How do you foresee 5G changing the telecoms landscape and what do you need to do to prepare? The next edition of The Future Network will be held at the 3rd Annual TowerXchange Meetup Europe, being held on 17-18 April at the Business Design Centre, London. Join MNOs, towercos, OEMs and other key stakeholders as we examine what the future network will look like and who the key actors will be. For more information visit our website here.
