The free webinar on Wednesday, Jan 30 will be loaded with the best current information on 5G. I guarantee it. Join us. http://bit.ly/5GSTLweb

The report examines more closely trends I've covered:

  • Every major company will launch "5G" by 2020 or 2021; some will have more press releases than customers.
  • Minimal revenue in 2019 and not that much in 2020. (Source: Verizon CFO)
  • Very few phones until late 2019. They will probably cost $200 extra, be large, and have limited battery life. (Source: Chinese carriers and phone makers)
  • The capital spending required is the same as or less than 4G, especially with a Smart Build. (Data from Deutsche Telekom and Orange)
  • 80+% will be in spectrum below 6 GHz, mostly in 3.5 GHz. This "sub-6" 5G is 4G LTE hardware and 5G New Radio software. Initially, speeds will be slower than good 4G LTE. (Believe it or not.) 
  • Verizon is spending US$20 billion to bring high-performance millimetre wave to 30 million homes. Customers are already reporting speeds of close to a gigabit. Very few others are planning mmWave, which offers about three times the capacity.
  • The cost per bit is drastically lower. (Lowell McAdam, Verizon)
  • much more, including strategies that can work 

 Here is the information on the report itself, which is professionally priced. STL Patners would be delighted to work with you. Mention my name.

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5G: The first three years

Executive Briefing ServiceNetwork Futures — tact us

After considerable hype and uncertainty, the near term developments for 5G are now much more apparent, including which nations will go first, chip and handset availability, and the use of different spectrum bands.

Introduction

On October 1, 2018, Verizon turned on the world’s first major 5G network. It is spending US$20 billion to offer 30 million homes millimetre wave 5G, often at speeds around a gigabit. One of the first homes in Houston “clocked speeds of 1.3 gigabits per second at 2,000 feet.”  CEO Vestberg expects to cover the whole country by 2028, some with 3.5 GHz. 5G: The first three years cuts through the hype and confusion to provide the industry a clear picture of the likely future. A companion report, 5G smart strategies, explores how 5G helps carriers make more money and defeat the competition.

This report is written by Dave Burstein with substantial help from Andrew Collinson and Dean Bubley.

What is 5G?

In one sense, 5G is just a name for all the new technologies now being widely deployed. It’s just better mobile broadband. It will not change the world anytime soon.

There are two very different flavours of 5G:

  • Millimetre wave: offers about 3X the capacity of mid-band or the best 4G. Spectrum used is from 20 GHz to over 60 GHz. Verizon’s mmWave system is designed to deliver 1 gigabit downloads to most customers and 5 gigabits shared. 26 GHz in Europe & 28 GHz in the U.S. are by far the most common.
  • Low and mid-band: uses 4G hardware and “New Radio” software. It is 60-80% less capable on average than millimetre wave and very similar in performance to 4G TD-LTE. 3.3 GHz – 4.2 GHz is by far the most important band.

To begin, a few examples.

The leaders are deploying millimetre wave

Verizon’s is arguably currently the most advanced 5G network in the world. Perhaps most surprisingly, the “smart build” is keeping costs so low capital spending is coming down. Verizon’s trials found millimetre wave performance much better than expected. In some cases, 5G capacity allowed reducing the number of cells.

Verizon will sell fixed wireless outside its incumbent territory. It has ~80 million customers out of district. Goldman Sachs estimates it will add 8 million fixed wireless by 2023 and more than pay for the buildout.

Verizon CEO Hans Vestberg says he believes mmWave capacity will allow very attractive offerings that will win customers away from the competition.

Telefónica Deutschland has similar plans, hoping to blow open the German market with mmWave to a quarter of the country. Deutsche Telekom and Vodafone are sticking with the much slower mid-band 5G and could be clobbered.

Most 5G will be the much slower low and mid-band, formerly called 4G.

80% or more of 5G worldwide the next three years will not be high-speed mmWave. Industry group 3GPP decided early in 2018 to call anything running New Radio software “5G.” In practice, almost any currently shipping 4G radio can add on the software and be called “5G.” The software was initially said to raise capacity between 10% and 52%. That’s 60% to 80% slower than mmWave. However, improved 4G technology has probably cut the difference by more than half. That’s 60% to 80% slower than mmWave. It’s been called “faux 5G” and “5G minus,” but few make the distinction. T-Mobile USA promises 5G to the entire country by 2020 without a large investment. Neville Ray is blanketing the country with 4G in 20 MHz of the new 600 MHz band. That doesn’t require many more towers due to the long reach of low frequencies. T-Mobile will add NR software for a marketing push.

In an FCC presentation, Ray said standalone T-Mobile will have a very wide 5G coverage but at relatively low speeds. Over 85% of users will connect at less than 100 megabits. The median “5G” connection will be 40-70 megabits. Some users will only get 10-20 megabits, compared to a T-Mobile average today of over 30 megabits. Aggregating 600 MHz NR with other T-Mobile bands now running LTE would be much faster but has not been demonstrated.

While attesting to the benefits of the T-Mobile-Sprint deal, Neville claimed that using Sprint spectrum at 2500 MHz and 11,000 Sprint towers will make a far more robust offering by 2024. 10% of this would be mmWave.

In the final section of this report, I discuss 5G smart strategy: “5G” is a magic marketing term. It will probably sell well even if 4G speeds are similar. The improved sales can justify a higher budget.

T-Mobile Germany promises nationwide 5G by 2025. That will be 3.5 GHz mid-band, probably using 100 MHz of spectrum. Germany has just set aside 400 MHz of spectrum at 3.5 GHz. DT, using 100 MHz of 3.5 GHz, will deliver 100–400 megabit downloads to most.

100–400 megabits is faster than much of T-Mobile’s DSL. It soon will add fixed mobile in some rural areas. In addition, T-Mobile is selling a combined wireless and DSL router. The router uses the DSL line preferably but can also draw on the wireless when the user requires more speed.

China Mobile plans two million base stations running 2.5 GHz, which has much better reach than radio in the 3.5 GHz spectrum. In addition, the Chinese telcos have been told to build a remarkable edge network. Minister Miao Wei wants “90% of China within 25 ms of a server.” That’s extremely ambitious but the Chinese have delivered miracles before. 344 million Chinese have fibre to the home, most built in four years.

Telus, Canada’s second incumbent, in 2016 carefully studied the coming 5G choices. The decision was to focus capital spending on more fibre in the interim. 2016 was too early to make 5G plans, but a strong fibre network would be crucial. Verizon also invested heavily in fibre in 2016 and 2017, which now is speeding 5G to market. Like Verizon, Telus sees the fibre paying off in many ways. It is doing fibre to the home, wireless backhaul, and service to major corporations. CEO Darren Entwistle in November 2018 spoke at length about its future 5G, including the importance of its large fibre build, although he hasn’t announced anything yet.

There is a general principle that if it’s too early to invest in 5G, it’s a good idea to build as much fibre as you can in the interim.

Contents:

  • Executive Summary
  • Some basic timelines
  • What will 5G deliver?
  • What will 5G be used for?
  • Current plans reviewed in the report
  • Introduction
  • What is 5G?
  • The leaders are deploying millimetre wave
  • Key dates
  • What 5G and advanced 4G deliver
  • Six things to know
  • Six myths
  • 5G “Smart Build” brings cost down to little more than 4G
  • 5G, Edge, Cable and IoT
  • Edge networks in 5G
  • “Cable is going to be humongous” – at least in the U.S.
  • IoT and 5G
  • IoT and 5G: Does anyone need millions of connections?
  • Current plans of selected carriers
  • Who’s who
  • Phone makers
  • The system vendors
  • Chip makers
  • Spectrum bands in the 5G era
  • Millimetre wave
  • A preview of 5G smart strategies
  • How can carriers use 5G to make more money?
  • The cold equations of growth

Figures:

  • Figure 1: 20 years of NTT DOCOMO capex
  • Figure 2: Verizon 5G network plans
  • Figure 3: Qualcomm’s baseband chip and radio frequency module
  • Figure 4: Intel 5G chip – Very limited 5G production capability until late 2019
  • Figure 5: Overview of 5G spectrum bands
  • Figure 6: 5G experience overview
  • Figure 7: Cisco VNI forecast of wireless traffic growth between 2021–2022

dave ask

Newsfeed

Vivo is selling new the iQOO 5G premium quality phone for US$536.

Lei Jun Xiaomi "5G to have explosive growth starting from Q2 2020"5G to have explosive growth starting from Q2 2020" I say sooner

Verizon CEO Ronan Dunne: >1/2 VZ 5G "will approximate to a good 4G service" Midband in "low hundreds" Mbps

CFO John Stephens says AT&T is going to cut capex soon.

Bharti in India has lost 45M customers who did not want to pay the minimum USS2/month. It's shutting down 3G to free some spectrum for 4G. It is cutting capex, dangerous when the 12 gigabytes/month of use continues to rise.

Huawei in 16 days sold 1,000,000 5G Mate 20s.  

China has over 50,000 upgraded base stations and may have more than 200,000 by yearend 2019. The growth is astonishing and about to accelerate. China will have more 5G than North America and Europe combined for several years.

5G phone prices are down to $580 in China from Oppo. Headed under $300 in 2020 and driving demand.

No one believed me when I wrote in May, 90% of Huawei U.S. purchases can be rapidly replaced and that Huawei would survive and thrive. Financial results are in, with 23% growth and increased phone sales. It is spending $17B on research in 2019, up > 10%. 

5G phones spotted from Sharp and Sony

NTT DOCOMO will begin "pre-commercial service Sept 20 with over 100 live bases. Officially, the commercial start is 2020.

 More newsfeed

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Welcome  1,800,000 Koreans bought 5G in the first four months. The demand is there, and most of the technology works. Meanwhile, the hype is unreal. Time for reporting closer to the truth.

The estimates you hear about 5G costs are wildly exaggerated. Verizon is building the most advanced wireless network while reducing capex. Deutsche Telekom and Orange/France Telecom also confirm they won't raise capex.

Massive MIMO in either 4G or "5G" can increase capacity 3X to 7X, including putting 2.3 GHz to 4.2 GHz to use. Carrier Aggregation, 256 QAM, and other tools double and triple that. Verizon sees cost/bit dropping 40% per year.

Cisco & others see traffic growth slowing to 30%/year or less.  I infer overcapacity almost everywhere.  

Believe it or not, 80+% of 5G (mid-band) for several years will be slower than good 4G, which is more developed.