5G as an enabler for new and smarter ways of working
Implications for real estate and construction
2020 has been a tumultuous year full of seismic shifts in everyday norms. In a year marked with greater public scrutiny of embedded social structures and behaviors, it is easy to forget that another impactful infrastructure change is quietly taking place. The next wave of digital disruption is on course and the 5G rollout will be the enabler. 5G will be the ”glue” that will tie all of our devices, buildings, and cities together, enabling new, smarter, ways of working for all of us.
Written by Andrew Carey | Deloitte UK
The need for speed, latency, reliability, and capacity
For the last several years, 4G – which was itself revolutionary at its introduction around 2010 - has served our society well. However, our demand for accurate and fast data is growing exponentially, and inherent limitations relating to speed, latency, reliability, and capacity are becoming more and more apparent. 5G mobile internet is a major leap forward from 4G. If its full potential is realized, it will not only address 4G’s limitations, but will transform the way we live, work, travel and play.
5G operates over much higher radio frequencies than 4G, which requires the substantial upgrade, and addition of, cell towers. Higher frequencies require the closer proximity of cells, meaning that ”small cell sites” will need to be added to buildings, light poles and other structures across the country. Network providers are building this high speed infrastructure at pace though, to date, the initial commercial application for the 5G rollout has centred upon mobile broadband.
More to come
The first 5G networks were launched in 2019 and were largely deployed from existing 4G base stations. Since then, various major network organizations have also launched 5G mobile network capability in a limited number of cities and towns. There is much more to come - 5G could solidify the business case for transformational technologies such as the Internet of Things (IoT), Artificial Intelligence (AI), Augmented & Virtual Reality (AR & VR) and Digital Twins all of which could have a significant impact in digitalizing various sectors – the sky is ”virtually” the limit.
Unsurprisingly, the rollout has been impacted by trade and tech disputes regarding certain 5G equipment and by the outbreak of COVID-19 for reasons including a reduced consumer demand (due to the increased Wi-Fi usage working from home), allegations linking 5G rollout with the COVID-19 spread, and ack of understanding concerning the benefits of 5G.
Implications for real estate and construction
Numerous industries have made significant digital transformation strides with 4G capability. What are the benefits of 5G? How can real estate leverage this new technology to accelerate digital transformation within an industry that is well behind others? Let’s explore the answers to these key questions further.
Greater network speeds
Standard 4G provides a maximum potential real world speed of around 80Mbps whereas 5G could reach peak speeds of 10-20Gbps . In combination with increased bandwidth, improved network speeds could greatly enhance construction processes. For instance, the remote use of VR could support communicating ideas to project teams in an agile setting. Also, 5G could increase the use of off-site manufacturing, unlocking AI to optimize quality control and risk escalation processes, and increase the use of 3D printing to create standard building components. It could improve information storage, progress tracking and automated project controls. And track and trace supply chain logistics could support ”just in time” delivery and minimize corruption.
The most significant benefit for the construction industry will most likely be 5G’s ability to take Building Information Modelling (BIM) to the next level, which will enhance the potential for fully confederated 6D Models and enable the creation of a cloud-based ”digital twin”. This will support more efficient delivery, integration and better decision making throughout the building lifecycle from concept design through to decommissioning. Further, the creation of these models will allow clients to ”look and feel” their projects earlier in the delivery process.
5G is expected reduce latency in the order of 1 millisecond . In other words, 5G response times will feel instantaneous . The implementation of IoT in real estate is progressing at a rapid pace, with more and more new buildings being specified with sensors inside and out. 5G will enable instantaneous connectivity to real time building usage data and infrastructure, providing scope for accurate tenant occupancy data and optimized maintenance regimes on assets. In the future, landlords may take advantage of private 5G splicing (i.e. pay for what you use, down to the device) to increase yields by offering bespoke services to their tenants. The potential for building assets with wire-free connections instead of Wi-Fi could radically reduce the implementation complexity of core building management systems (including fire, security, lighting, HVAC and energy/utilities).
Faster response times between devices will also allow for the more widespread use of autonomous vehicles and the associated transport infrastructure. With more people working from home, 5G connections may soon replace the need for Wi-Fi. Valuation of 5G technology infrastructure will have to be considered within future development appraisals to enhance value and marketability.
More bandwidth and data capacity would reduce competition for connection and would allow the support of up to one million devices per square kilometer². 5G combined with big data applications and cloud storage capabilities could increase data on space utilization, power and energy consumption. A much-needed retail revolution could start with VR and AR to create experiential retail environments and be further developed by in-store analytics to personalize shoppers’ experiences. Big data applications could also support the continued effort to enforce social distancing as more offices and retail outlets open.
In time, collecting and interpretation of data produced by real estate assets will become a defensive strategy for most real estate stakeholders. It will help them to maintain an edge over their competitors. Also, more regulatory requirements are imposed by governments to encourage the use of 5G technology, as it will increase productivity and efficiency and improve sustainability performance.
It is important to factor into any business case the challenges involved with optimizing 5G and the various technologies it enables. These include but are not limited to:
- shorter frequency waves requiring small cell site technology with antennas as close as 500 feet apart
- higher risk of obstacles (including building materials) blocking or disrupting high frequency 5G signals
- many devices that will need to be 5G enabled, e.g. better battery technology
- GDPR legislation and privacy laws that may limit 5G optimization.
5G as an enabler for workplace transformation
As pre-existing working patterns continue to shift, 5G could further consolidate the workplace transformation. Fully integrated 5G offices could create enhanced revenue opportunities for landlords through different types of leasing models. Business models of flexible office operators, booking desks and meeting rooms with specific digital capability, may become more common as 5G networks expand.
2020 may have slowed down the 5G technology revolution, but it has also further highlighted the need for improved connectivity, greater network speeds, reduced latency and wider bandwidth capacity to support digital transformation. Although there are challenges in implementing 5G and no doubt greater speeds will soon exceed it, the economic and social benefits will outweigh the costs. The real estate sector has the ”bandwidth” to reap some of the greatest benefits from its implementation.