BOSTON, Massachusetts: While Hollywood royalty waltzed down the red carpet last week ready for an evening of festivities and celebration, the mobile industry was busy hosting its own Academy Awards. The stars – Samsung and Huawei – dazzled with the unveiling of foldable, 5G-ready handsets.
Meanwhile, the supporting cast (Read: Operators like T-Mobile and Verizon) and backstage crew – your Ciscos and VMWares of this world – were all united in the promise of super-fast data coming soon to a network near you. Chipmaker Qualcomm went bold with a simple claim: 5G is here.
THE JURY IS STILL OUT
Indeed, 5G has been the talk of the telecoms town as of late, as tensions rise between the US and Europe around Huawei’s involvement in bringing the network to life.
READ: Huawei would make a terrible spy - and other reasons why US indictments don't stick, a commentary
But is it as close as everyone says it is? Could you really pop some cables together and hey, presto you’re connected?
For all the glitz and glam that surrounds the lavish annual phenomenon that is Mobile World Congress, and for all the political rhetoric that seems to have found its way into the conversation, I think it’s safe to say the jury’s still out on that one.
Now, that’s not to say that 5G is a myth – far from it. Nations around the world have poured billions into making 5G a technological and economic reality. China alone is expected to spend a whopping US$411 billion on 5G mobile networks between 2020 and 2030.
Nor is that to say that progress hasn’t been made. Over the past 12 months, for example, we’ve seen some significant advancements in Network Function Virtualisations (NFV) - essentially, the technology that would enable us to split the 5G network into different lanes of traffic (similar to having a slow and fast lane on a highway) and digitise everything.
This is vital in achieving the speed, availability and resiliency that 5G is touted to bring. After all, if you’re running a 100 metre sprint, it’s generally easier and quicker if there aren’t any hurdles in the way. It also means that customers get a choice in which lane they want.
QUITE A FEW CHALLENGES TO TACKLE FIRST
The ecosystems that are needed to support 5G are starting to form in real and tangible ways. However, when you start to dissect through the hype and buzz, the reality dawns.
Without a doubt, 5G will shape the future of our technological landscape – but it’s got a lot of ground to cover, and is not without its challenges in the here and now.
Unlike its predecessors, which only had to focus on one or two things (such as voice, or mobile data), 5G is tasked with supporting a very wide range of new and emerging technologies. That means more time, more expense and more complications, with – at least at the moment – seemingly little return on investment.
OPERATORS ARE NOT HAPPY
For starters, it’s important to realise that the introduction of 5G isn’t necessarily something operators are happy about. For the most part, network innovations (like NFV) are being driven by the IT community and their start-up children – nowadays it’s all about the software and the cloud.
Meanwhile, operators are stuck with a lot of pipes and wires. If everything gets digitised, suddenly, those pipes aren’t all that important or valuable anymore.
So it’s a scramble as to who can get in on the software game. In the same way the finance and retail industries have been disrupted by technologically savvy newcomers, 5G represents an ultimatum, forcing business transformation.
Even those who do succeed in grabbing a piece of the 5G market may have to make do with the short end of the stick.
Relegation is a very real prospect for operators, where they’d be charged with managing the customer experience, the handsets and the shop front – essentially where it’ll be trickiest to turn a good profit and therefore take even longer for them to recoup costs sunk in becoming 5G-ready.
MIGRATION WILL GENERATE COSTS
That’s not to say there are no benefits for operators – continuing to run legacy networks like 2G, 3G and 4G is an expensive business. Think of it as having to operate several independent lanes of traffic, instead of one wide road.
Consolidating these lanes into 5G would certainly help drive down costs, particularly as new technologies that generate a lot of data come on to the market.
The problem is that migrating to 5G takes time – as well as more costs. Disruptions and outages would be difficult to mitigate in their entirety, and we know how the world reacts whenever Facebook or Instagram go down.
So, getting customers to buy into a migration that could very well inconvenience them – especially when there are still plenty of applications and functions that work perfectly fine on current networks – will be no easy feat.
WHERE’S THE USE CASE?
And when we talk about applications, we don’t just mean internet browsing. The reality is that at the moment, the technologies that would best leverage 5G, such as autonomous vehicles, the Internet of Things and artificial intelligence, are still nascent.
Sure, there are plenty of trials – but for trials, where data is contained and doesn’t need to travel far, the networks we currently have in place are more than fit for function.
For 5G to earn its keep and justify its existence, we need scale. We need driverless cars on every road, Alexas in every home and sensors on every path generating data that needs immediate processing, and has to zoom back and forth between data centres and the cloud.
It’s not being built for checking in on social media or sending emails to colleagues, but to realise smart visions around the world – and as a global society, we’re simply not there yet.
GETTING CUSTOMERS ONBOARD ISN’T GOING TO BE EASY
However, let’s come back to the fire starters – 5G-ready (and in some cases, foldable) handsets. Putting aside vague release dates for the majority of the announced devices, we need to scrutinise the price tag.
Not just in terms of the phones, which between Samsung and Huawei are expected to retail for approximately US$2,000, but almost certainly the subscription packages that will follow too.
When telecoms giant AT&T “launched” its first 5G plan, packages started at US$70 – so it would be reasonable to expect a muted response, at least initially.
“Launched” being the operative word, because the 5G capabilities were in fact lacking. AT&T’s 5GE was ultimately found to be an evolution in 4G LTE, repackaged – faster, for sure, but to the levels of 5G connection? Absolutely not – making consumers also, rightfully, wary of the next operator to make the claim.
Look past the marketing smoke and mirrors, and it’s clear to see that 5G isn’t here yet. Customers, whether consumers or businesses, can’t go out and buy a fully-integrated end-to-end 5G solution. At the moment, all we have are fragments of the whole and several questions that require answers.
And if we’re to move forward with 5G, it’s important we face these challenges head on instead of painting this image of 5G as a silver bullet – the promise is yet to be realised, so let’s not pretend that all our problems have been solved.
That said, the fragments we have are bringing us closer. The technological advancements needed both for 5G to exist and warrant existence are beginning to surface. The tide that will lift the entire armada is rising, slowly but surely.
Soon, 5G will be coming to a home, office, car, city, hospital – you name it – near you, and enabling us to reach greater technological heights than ever before. It just won’t be in 2019.
Vernon Turner is Executive Analyst at Ecosystm.