5G Optimism Abates?
Part 1 - Survey shows operators are more realistic about 5G
During the last part of 2018, ACG Research conducted an independent study of service providers upon request of ECI. The purpose of this survey was to better understand the industry’s proclivity toward network slicing. Particularly since the standards are far from complete in this ‘neck of the woods’. And of course, you can’t get directly to the point without first understanding where the respondents stand with regards to 5G in general.
70 service providers (mobile, fixed, cable and wholesale) from around the world provided inputs to the questions posed by ACG Research. All of the participants reported being knowledgeable of their organizations 5G plans and decisions, many of them holding senior positions within the organization. The survey was conducted online, in English only.
This short blog series will examine the results of this survey and to ‘compare and contrast’ them with other surveys sponsored by ECI during the last quarter of 2018.
5G is imminent – but will not happen over night
The vast majority of respondents report that their organization will roll out 5G within the next 12-24 months. Less than 1/5 of respondents report their organization will deploy 5G within the next year.
This may be surprising for those of us who are following the news, wherein we see operator after operator announcing the launch of 5G services. But for those of us in the know, we all understand that 5G is far from being available. Yes, there are operators rolling out the new radio (NR), some even in multiple locations, but 5G radio doesn’t equal 5G. At its best, it means that the radio part of the network is faster than before, covering a larger area than originally thought, but in no way does this mean that 5G is commercially available. No sticker in the world can change that 🙂
The results of the ACG Research survey are similar to those in the survey conducted by telecom.com during 3Q2019. There the majority of service providers and MNOs report that they expect 5G to be ‘commercially launched’ in their market by 2020. Click here to download the full telecoms.com survey.
Quite some barriers remain to the roll out of true 5G networks
While commercial availability is expected quite soon, ACG survey respondents still believe there are quite a few barriers to the commercial deployment of 5G. Some of them so basic and essential, that it is a wonder that respondents are so optimistic about commercial deployment. Lack of available spectrum, lack of required standards and lack of appropriate networking equipment ranked highest on the list of 5G barriers, regardless of region or type of service provider.
While lack of available spectrum came in first, also in the telecoms.coms survey, the issues which ranked second and third were: lack of a viable business case and expected costs (investment required) with no difference between service providers and MNOs.
Expected benefits of deploying 5G transport are technology related
While not completely surprising, respondents reported the top benefits of deploying 5G transport are the expected increases in speed &capacity and support of network slicing. Benefits related to profitability (decreased expenses/new revenue streams) were ranked significantly lower.
Indeed, in the survey conducted by telecoms.com the vast majority of service providers reported that they don’t believe consumers will pay more for 5G services (77% believe consumers will be willing to pay less than 5% more for 5G services). Moreover, 75% of respondents believe that it will take more than 5 years, sometimes as much as 20 years, for operators to break even on their 5G investments. Result such as these suggest that operators are not in 5G ‘for the money’. That said, we didn’t ask them what they expect would happen to those operators who would not offer 5G services.
5G will be rolled out initially as a separate network
Last, but not least, we asked respondents how they intend to roll out their 5G transport networks, in NSA (non-stand-alone) mode, or separately from their current LTE transport? We also asked whether they networks would continue to be separate, or converged. Below you see the responses. The vast majority indeed believe that the 5G transport network will be rolled out a separate network, but there is no consensus as to whether they would remain separate or eventually converge.
These findings negate industry announcements of going 5G initially NSA mode. However, perhaps service providers are finding it easier to separate their concerns rather than compile them?
Well that’s all for this blog post. In the next blog we will discuss our findings around 5G slicing and slicing technologies. Stay tuned for more information.
Click here to learn more about ECI's 5G Solutions.