Introduction

The fourth industrial revolution is leading to a positive impact on society and the emergence of exponential technologies which will enhance consumers day to day lives. We now live in a world of bytes, and for the first-time technology and commerce have collided in a way that makes data far more valuable than physical tangible assets. Core and centre to this is speed of connectivity and data download, and upload, which has inevitably led to the requirement of 5G to support core transformation of wireless networks.

Deloitte Ireland conducted a survey in 2021 to explore the attitudes of 5G in the Irish market. One of the key highlights of the survey found that 56% of respondents do not yet know enough about 5G and the benefits which it brings. The purpose of this article is to firstly provide an overview of 5G, outline the current perceived benefits of 5G and finally look at the potential barriers of adoption of 5G within the Irish market.

Highlights

• 4G, 4G plus and Wi-Fi are sufficient for consumers needs at this current point and time.
• 5G benefits are currently seen in industry through the application of Artificial Intelligence.
• Collaboration through consortia of stakeholders will be critical as part of 5G deployment across Ireland alongside significant investment in supporting infrastructure.
• Many consumer devices are currently not compatible with 5G within the Irish market.
• Deployment and adoption of 5G will be on a phased approach with 5G, 4G and wifi co-existing over the next ten years.

Benefits of 5G

5G will deliver a plethora of benefits to both the consumer and industry. The consumer will enjoy benefits through social impact leading to enhanced health care, smart cities, enhanced methods of entertainment inclusive of augmented reality alongside faster connectivity. Industry will benefit from enhanced operational effectiveness and improved working environments.

Current consumer view
As part of Deloitte Ireland’s annual consumer trends survey, Deloitte surveyed consumer’s attitudes towards 5G in 2020 and 2021. One of the key highlights of note after surveying consumers was that respondents do not yet know enough about 5G and the benefits which it’s brings; with 64% of respondents in 2020 stating they did not know enough about 5G decreasing to 57% in 2021. It is clear from the results of the survey’s, that over 50% of consumers in Ireland do not understand 5G or the clear benefits that will be experienced once fully adopted. With that said, 61% of consumers surveyed in 2021 stated they believed that 5G would enhance network connectivity in comparison to 50% in 2020.

Figure 1. 57% of people do not know enough about 5G.

Currently, there are no real added benefits to the consumer for immediate adoption to 5G. The consumer case for change will be more medium to long term. 4G, 4Gplus and Wi-Fi, currently satisfy consumer needs and expectations. 54% of respondents in the Deloitte 2021 survey stated that they were unable to tell the difference between 4G and 5G. 4G speeds measuring up to 1000mbs demonstrate that current speeds for data downloaded sufficiently meet consumer demands.

Figure 2. 54% of people cannot tell the difference between 4G and 5G.

Furthermore, when consumers were surveyed regarding most important features when selecting a smartphone, the top three features that influence consumers in their decision for purchasing/upgrading are the following:

1. Battery Life
2. Storage Capacity
3. Camera functionality and quality

5G featured at number 10 on the list, highlighting that the consumer does not view 5G as a necessity and further emphasises that consumers are satisfied with 4G at this point in time.

Figure 3. Aside from price, battery life was the most important factor across all age groups when deciding which smartphone to buy next.

Work from home restrictions during COVID-19, have demonstrated that consumer requirements have been predominantly met with many urban areas experiencing a high standard of Wi-Fi inclusive of the quality of TV/streaming services utilising 4G and Wi-Fi. ComReg conducted a survey in Q1 2021 on the impact of COVID-19 on home broadband and mobile service usage. According to the survey, 4 out of 5 broadband users continue to agree that their home broadband is adequate to meet the needs of their households. The report also concluded that that those using various technology services for work related activities at home are satisfised (ComReg).

However, the current network is not built for a sustainable work from home scenario and further enhances the requirement for the 5G upgrade and adoption. As discussed, in the 5G and future connectivity discussion paper led by smart city team based in Dublin city council; the impact of COVID-19 has highlighted the importance of current and future connectivity not just in city centres but across suburbs, towns, and rural communities. Remote working will now be a necessity which further highlights the requirement to future proof Irish cities, towns, and communities to support more flexible working options in a way that protects Ireland’s future competitiveness (DCC).

In the short term, there are currently no benefits to the consumer, however, over the medium and long term, as 5G becomes more mainstream and rate of adoption increases, the consumer will see the overall benefit of social impact which 5G will deliver such as contributing to improved health and wellbeing, enhanced entertainment inclusive of augmented reality, smart cities, sustainable living, enabling better work life balance alongside economic growth. In the meantime, consumers will be exposed to a blend of wireless connectivity as 5G will co-exist with 4G and Wi-Fi until mainstream adoption of 5G which potentially could take another ten years.

Current Industry View
Today, industry is the primary benefactor of 5G adoption. Artificial Intelligence (robotic process automation, machine learning, chat bots, natural language processing) gain from the speed which data is received allowing the technology to perform more quickly and efficiently, leading to better quality output. Three of the five core functions of 5G are enabling and unlocking value; Enhanced mobile broadband (eMBB); Ultra-reliable low latency communication (uRLLC); Massive machine type communications (mMTC) (WEF).

Manufacturing greatly benefits from massive machine type communications (mMTC). Machine to machine communication has allowed for reduced human error within many of the production processes whilst increasing speed of production. Predictive intelligence enabled by 5G has advanced inspections of products more quickly adding to further efficiencies within the process.

Drone based applications have been successful to date due to the speed at which 5G can send the data to the drone to perform the relevant activities required of it.

Machine learning has benefited through ultra-reliable low latency communication (uRLLC). Through faster uploads of data into the various algorithms, decisions and outcomes from machine learning can be delivered in near to real time thus leading to quicker decision making and responses to customers.

Although industry is benefiting from 5G in the short term, the medium to long term benefits is far more reaching. Industry will benefit from improved operational effectiveness, process efficiencies and simplification, reduced wastage, improved lead times and improved decision making alongside speed to consumer.

Potential Barriers to adoption

Requirement for collaboration

Collaboration between key stakeholder is critical for the successful rollout and delivery of 5G. In Ireland, there will be a requirement for a consortium of stakeholders comprising of public private partnerships, local authorities, MNO’s, tower companies and other broader stakeholders to collaborate in the delivery and adoption of 5G across Ireland. There will be a requirement to define a collaborative framework and governance model.

Infrastructure Investment

The deployment of 5G and relevant upgrades to the current infrastructure will be of vital importance to ensure that 5G is available widespread across the island. Significant investment in infrastructure will be a critical to its success alongside the challenges of upgrading fibre and power connections. The current level of fibre density in urban and rural Ireland is not sufficient to support 5G and will require significant upgrading.

Cell tower infrastructures will require upgrading. Over the past two years, the three main MNO’s have carved out their cell tower companies as part of strategic initiatives linked to the requirement of unlocking the potential investment that 5G drives whilst delivering the critical capital injection for the upgrading of the infrastructure. Cell towers however have been noted as a particular eyesore to the public therefore the tower companies will need to work closely with local authorities to identify other assets such as street light poles that could act as alternatives to large tower structures.

Another challenge is the fact that power is currently not metered in Ireland unlike mainland Europe. Power is an erroneous cost for each cell tower. Prior to the carve out of the cell tower infrastructure from MNO’s, MNOs were responsible for the power costs of their cell towers. However, with the carve outs of these entities, MNO’s now have a greater choice of cell towers to select from to support the reach of their network. This leads to the issue of who is responsible for the cost of power for each cell tower in operation. Smart meters track the consumption of energy in real time therefore tracking the power consumption of each of the players associated with the cell tower allowing for the power costs to be split equitably amongst the stakeholders. The rollout of smart metres to each cell tower will be an additional cost as part of the infrastructure upgrades.

Device compatibility and consumer adoption

Currently, most devices in Ireland are not 5G compatible. This a key barrier to adoption for the consumer. Most devices in use in the Irish market are 4G compatible and as previously mentioned satisfy many Irish consumers requirements. Devices must be able to support higher performance and are required to exist in a variety of form factors to support 5G. With longer battery life and COVID-19, the requirement to purchase a new device which is 5G compatible is not high on consumer agendas. Current 5G compatible devices start with iphone13 and Samsung Galaxy S20 series therefore further highlighting the requirement for consumer to purchase the latest version of devices. Alongside this, businesses who offer devices to their staff will need to consider and factor in the cost of replacing devices to assist in the adoption of 5G.

Consumer adoption is slow. As part of the consumer trends survey, consumers were asked what described their attitudes towards switching to 5G networks. 10% responded stating that they already use 5G, 15% stating they would switch as soon as it was available in their region, whilst 30% stated that they would probably switch to 5G network eventually. In addition, 18% stated that they would switch to 5G if it was the standard offering, and no alternative was available.

Figure 4. Willingness to switch to 5G.

Spectrum is the oil of the 5G ecosystem. It is the radio frequency which enables 5G network infrastructure and devices to operate. In May 2020, the Irish government announced the rollout of Ireland’s National Roadmap on the use of the 700MHz Frequency band (spectrum). ComReg manages radio frequency on behalf of the Irish state. MNO’s must apply and be granted a licence by ComReg to operate wireless broadband services.

In Jan 2021, the MNO Three issued legal proceedings against ComReg over the new licences for radio spectrum as it is unhappy with the plan to cap how much spectrum individual MNO’s can purchase due to strategic initiative to rebalance competition in the Irish market (Times). Three currently has the largest spectrum due to its acquisition of O2 several years previously. The legal action is due to impact the 5G roadmap potentially up to 12 months and could lead to potential delays in certain 5G services being available to the consumer.

In addition to the delays, health concerns with regards to spectrum and the emission of radio frequency for 5G still remain a concern within the wider public. According to the Deloitte consumer trends survey 2020, 20% of respondents believed that there were health risks associated with 5G. This reduced to 16% of respondents in 2021.

Security will be vital for the success of 5G. In a study conducted by Nokia, 34% of respondents stated that they were concerned about the security of 5G whilst 22% cited security risks relating to 5G as a primary barrier to adoption (Nokia). There are various reasons behind this perception. One such example is the transition period to 5G from 3G/4G. There could be potential vulnerabilities within the network that could be exploited by hackers during the transition period which could effectively take up to ten years to complete due to the phased rollout approach.

Reducing the threat to security as part of the adoption will be critical to organisations. There will be a requirement to update cybersecurity strategies as part of the deployment. Further to this, Governments will need to introduce policy. The Irish Government announced it has agreed to endorse the EU 5G Security Toolbox as its framework by which Ireland will secure its next generation of broadband networks (Gov.ie).

What does the roadmap to adoption in Ireland look like?

The rollout and adoption of 5G in Ireland will be a phased approach and could take up to 2030 for full end to end adoption. 5G, 4G, 4G plus and Wi-Fi will coexist during the transition period. Collaboration of key stakeholders will be a critical factor to enable Ireland’s successful deployment of 5G. Infrastructure will require significant investment and capital injection to support the rollout of 5G. In the short term, 5G has the potential to provide efficiency gains on specific use cases within industry particularly with regards to Artificial Intelligence such as robotic process automation and machine to machine connectivity. However, the road to end to end consumer adoption will be more medium to long term. Consumer adoption is currently slow with only 10% currently utilising 5G. However, as 5G becomes more readily available in regions, consumers upgrading to the latest smartphone devices and more consumer services requiring 5G become more readily available, consumer adoption will gain speed with consumers experiencing the full end to end benefits.

References/Source materials

• World Economic Forum, The Impact of 5G: Creating New Value across Industries & Society, January 2020
• The Irish Times, Three takes ComReg to court over plans to cap radio spectrum purchase, January 2021
• Gov.ie, Ireland’s National Roadmap on the use of the 700MHz Frequency Band, January 2021
• Smart City Dublin City Council (DCC), 5G and Future Connectivity; An Emerging Framework for Irish Cities and Towns
• Commission for Communications Regulation, The Impact of Covid-19 on Home Broadband and Mobile Service Usage, April 2021
• Nokia, What is holding business back