At the start of 2023, we were hopeful that the year would be that of 5G SA. In the event, only seven deployments materialised in the first 6 months leaving a staggering 30 in our tracker as "in progress" and to be completed in the second half of 2023. In this report, we discuss how likely it is that these deployments will take place in 2023 or at all and if 5G SA still matters.

5G SA core: Will 2H23 finally see momentum?

At the end of 2021, we predicted that 5G SA core deployments would significantly accelerate in 2022, but they did not. There were 21 launches of converged 5G NSA/SA or pure 5G SA cores in 2022, against 18 in 2021. In the January 2023 update of our tracker, when we reviewed telco cloud activity for 2022, we shifted all the outstanding deployments once expected in 2022 to 2023. Some of these deployments had been announced for over two years and this made 2023 look as if it might become the year of 5G SA.

Now at the half-way point in 2023, there have been only seven 5G SA (including converged 5G NSA/SA) core deployments so far:

• Although few in number, these deployments are significant either by their scale (Reliance Jio in India) or by virtue of the importance of the operators involved: E& (introduced in the UAE in March); and Vodafone (in the UK in June).
• And for Orange, which is engaged in 5G SA deployments across its entire European footprint, the launch of a first country (Spain in February 2023) is encouraging progress.

But it is legitimate to ask whether the remaining 30 5G SA launches that we still have pending for 2023 are likely to take place in the remaining six months (as our Tracker currently reflects). Or will they in fact trickle in over the next few years or even not happen at all?

Global deployments of 5G core by type, 2018–2024

Source: STL Partners

 

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Why have SA 5GC deployments gone off track?

Our September 2022 report 5G standalone (SA) core: Why and how telcos should keep going provided some pointers as to why operators are slow in jumping to 5G SA. These remain valid today:

1. 5G SA requires significant investment, for which (in some markets at least) there is no clear ROI because the use cases that would leverage 5G SA capabilities (in terms of latency, bandwidth or high volume of connections) are yet to emerge, both on the consumer and the enterprise fronts, as are the ways to monetise them.
2. Many operators are still weighing up their strategy for partnering with the hyperscale cloud providers. In particular, this relates to the role of public cloud as an infrastructure platform for 5G SA deployments and the role hyperscaler infrastructure can play in accelerating SA network coverage.
3. Some of the leading operators that are yet to launch SA are also among the main supporters of open RAN and/or are engaged in fibre rollout projects: those conflicting investment requirements may create delays and a need for phasing in some of the rollouts.

To fully exploit 5G SA requires an organisational evolution within telcos. To reap its benefits as both a pure connectivity enabler and as a platform for innovative services, telcos need to undergo an evolution in their processes and organisations to support cloud practices and operations. This doesn’t happen overnight.

In APAC where SA is steaming ahead, greater telco ambition and strong state support have spurred deployments

One way to address the question of stalled 5G SA deployments is to examine what has driven the deployments that have taken place. Will the use cases involved there drive a bigger wave of deployments globally?

While there have been 13 (converged 5G NSA/) SA core deployments in Europe, 31 have taken place in APAC. They involve the leading operators in China, Japan, the Philippines, Singapore, South Korea and Taiwan. The roll-outs support bandwidth-hungry consumer use cases such as gaming, AR/VR, HD/4K content streaming, VoNR, etc. Some operators, such as NTT Docomo, SK Telecom and the Chinese players, have made SA available to support a limited number of private networking and industrial IoT use cases. Factors driving these deployments include:

• State support or mandates for 5G SA (China and South Korea)
• Consumer enthusiasm for and early adoption of 5G, with the SA version offering tangible performance gains over 4G
• Rich ecosystem of local device manufacturers and app developers, and a commitment by operators to invest in new use cases and services
• Ability to offload ‘power users’ of bandwidth-hungry, latency-critical services off the 4G and 5G NSA network and willingness from those users to pay a premium for these benefits (the three Chinese operators have seen modest ARPU increases between 2020 and 2022 of between 2.5% and 5.2% per annum)
• Pre-existing local and metro fibre, supporting 5G SA backhaul.

Effective deployments of 5G SA and converged 5G NSA/SA cores by region, 2019-23

Source: STL Partners

 

Table of Contents

• Executive summary
• Deep dive: Is 5G SA getting real?
• Regional overview
• Operator view
• Vendor view

Related research

• Telco Cloud Deployment Tracker: Deploying NFs on public cloud without losing control
• The telco cloud manifesto 2.0
• Telco Cloud Deployment Tracker: Will vRAN eclipse pure open RAN?
• 5G standalone (SA) core: Why and how telcos should keep going
• Pursuing hyperscale economics

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