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The clamour is getting louder. The coming launch of 5G wireless networks has set off a frenzy of guesswork, predictions, questions and speculation. When? Where? Who has it? How can I get it?
Fast – very fast, if real-world conditions live up to tests. Peak speeds in field trials have reached as high as 35 gigabits per second (Gbps), although speeds in actual use are anticipated in the hundreds of megabits per second (Mbps) – still 10 to 20 times faster, on average, than 4G networks, and also faster than cable and fibre optic networks, in some cases. Of course, speed isn’t everything. In much the same way 4G has created the space for numerous innovations over the last decade, 5G is poised to further revolutionise the notion of connectivity, and to enable previously impossible applications. Driverless cars? Remote surgery with haptic feedback? A fully fledged Internet of Things? Yes, and more, but all in good time.
5G phones are on the way, with about 20 vendors predicted to release new handsets in 2019 (with the notable exception of a 5G iPhone, not expected until 2020). More likely to bridge the divide, at least in the near term, are 5G modems/hotspots. These small, portable devices (aka dongles) connect phones, computers, tablets and other devices to the internet. They are relatively simple to produce – made up of just a radio, antennas and a battery – and therefore far cheaper than handsets. Their low cost and adaptability offer users an entry point to 5G networks, provide vendors an income stream, and further incentivise operators to build out their 5G networks.
This scenario echoes the early days of 4G, when the modem/hotspot market generated hundreds of millions of dollars in revenue for device makers and the operators charging wireless subscription fees. Only with the later arrival of affordable hotspot-capable smartphones – and gradual expansion of 4G networks – did handset sales overtake sales of 4G modem/hotspots.
Where 5G will differ significantly from its predecessor, however, is in its impact on connectivity. 5G’s real competitor is not 4G, but traditional broadband services. 5G modem/hotspots are one way the technology will supplant wired networks; the other is through fixed-wireless access (FWA) devices, which can receive a 5G signal via antenna and distribute a high-speed Wi-Fi signal within a home or business.
For network operators, the initial focus will be on rolling out more antennas and base stations required to deliver 5G signals. The multiple frequency bands for carrying 5G (low-band, mid-band and high-frequency millimetre wave upwards of 24 Ghz) that cause a headache for handset manufacturers also pose challenges for operators, as the weaker obstacle penetration of 5G requires transmission infrastructure in close proximity to end users.
Australia is well positioned to become a leader in 5G, as device manufacturers launch new handsets in response to infrastructure readiness and strong investments by telcos in 5G networks. Telstra plans to release the first 5G devices in the first half of 2019, which could reach sales of up to 50,000 units – or 5% of projected global sales.
The prospects for fixed wireless also look positive. Optus has already launched 5G fixed wireless services in Canberra and NSW, and plans to expand its network to other major cities by mid-year. In turn, internet resellers will increasingly offer 5G fixed wireless as the year progresses.
As fixed wireless expands in Australia, the implications for NBN are likely to be mixed. Some operators may challenge NBN by moving customers to mobile-only service delivery, while others use them in complementary roles.
The competitive landscape among operators is also likely to see shifting approaches, with new partnership agreements, mergers and acquisitions in response to the challenges of scaling up infrastructure while meeting increasing demand for services.
What is certain is that the rollout of 5G across Australia will trigger a wave of new products and applications powered by massive improvements in speed, latency and network capacity – IoT devices, smart appliances, smarter cities and on and on.
The future is on the march again. But in the meantime, hold on to your steering wheel.
More information on the arrival of 5G in Australia is available in Deloitte’s TMT Predictions 2019.
Amrit is a Principal in Deloitte Asia-Pacific Consulting, focused on the Australian TMT clients. He leads the TMT Networks CoE and is an active part of the firm’s telco engagements in the region. In his role as a Principal at Deloitte, he works with a diverse set of clients to evangelise new business models underpinned by technology, plan and execute digital transformation and develop business and technology strategy and roadmap in diverse areas of IoT, AI, Automation, Big Data, SDN/NFV and AR/VR. Prior to joining Deloitte, he was the Chief Architect for the Telstra account in Infosys Consulting, where he was responsible for spearheading Infosys' growth footprint in new and emerging technologies with Telstra CTO, Networks and IT. Throughout his 18 years in the industry, Amrit has worked on some of the most complex and innovative projects in the local TMT industry. He is part of the TM Forum and has presented at their annual flagship event in Nice, France in 2014 and 2016.