Tag: private networks

What do enterprises want from telcos?

Enterprises are striving for success…

All enterprises want success. The language and specifics that define this may differ across sectors – but the underlying drivers are the same. They include financial, strategic, operational and market-facing factors, as described below.

Success drivers

enterprise

Source: STL Partners

…against a new, transformed backdrop

Demand and supply forces have changed: Customers expect more, but resources are increasingly constrained. Enterprises are pondering the range of new technologies and practices to help them meet the challenges of a Coordination Age:

  • Coordinating outcomes and experiences for customers
  • Collaborating to enable the delivery of more value
  • Bridging the digital and physical worlds

The Coordination Age

Enterprise

Source: STL Partners

Telcos’ national scope and assets mean they are well placed to participate in some of the new opportunity areas of the Coordination Age. Although technologies and applications running over the telcos’ connectivity are often developed at global scale, how they are implemented within local and national markets is likely to vary from one country to the next, owing to regulatory constraints and how these have shaped the structure and priorities of the market. Telcos can help enterprises navigate this path.

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Do enterprises believe telcos can help?

What enterprises think of telcos depends on their tech maturity, their knowledge and experience of telcos, the telcos’ technology capability and the sector that they are in, as shown below.

Factors influencing enterprise consideration

 

enterprisesSource: STL Partners

Telcos must work to understand enterprise needs in their specific markets and how they are best placed to serve those needs.

Table of contents

  • Executive summary
  • Introduction
  • Understanding telco enterprise strategies
  • Seven enterprise growth opportunities

Related research

STL Partners has a research solution focused on growing enterprise revenues. Reports that could be of interest include:

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MWC 2023: You are now in a new industry

The birth of a new sector: “Connected Technologies”

Mobile World Congress (MWC) is the world’s biggest showcase for the mobile telecoms industry. MWC 2023 marked the second year back to full scale after COVID disruptions. With 88k visitors, 2,400 exhibitors and 1,000 speakers it did not quite reach pre-COVID heights, but remained an enormous scale event. Notably, 56% of visitors came from industries adjacent to the core mobile ecosystem, reflecting STL’s view that we are now in a new industry with a diverse range of players delivering connected technologies.

With such scale It can be difficult to find the significant messages through the noise. STL’s research team attended the event in full force, and we each focused on a specific topic. In this report we distil what we saw at MWC 2023 and what we think it means for telecoms operators, technology companies and new players entering the industry.

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STL Partners research team at MWC 2023

STL-Partners-MWC23-research-team

The diversity of companies attending and of applications demonstrated at MWC23 illustrated that the business being conducted is no longer the delivery of mobile communications. It is addressing a broader goal that we’ve described as the Coordination Age. This is the use of connected technologies to help a wide range of customers make better use of their resources.

The centrality of the GSMA Open Gateway announcement in discussions was one harbinger of the new model. The point of the APIs is to enable other players to access and use telecoms resources more automatically and rapidly, rather than through lengthy and complex bespoke processes. It starts to open many new business model opportunities across the economy. To steal the words of John Antanaitis, VP Global Portfolio Marketing at Vonage, APIs are “a small key to a big door”.

Other examples from MWC 2023 underlining the transition of “telecommunications” to a sector with new boundaries and new functions include:

  • The centrality of ecosystems and partnerships, which fundamentally serve to connect different parts of the technology value chain.
  • The importance of sustainability to the industry’s agenda. This is about careful and efficient use of resources within the industry and enabling customers to connect their own technologies to optimise energy consumption and their uses of other scarce resources such as land, water and carbon.
  • An increasing interest and experimentation with the metaverse, which uses connected technologies (AR/VR, high speed data, sometimes edge resources) to deliver a newly visceral experience to its users, in turn delivering other benefits, such as more engaging entertainment (better use of leisure time and attention), and more compelling training experiences (e.g. delivering more realistic and lifelike emergency training scenarios).
  • A primary purpose of telco cloud is to break out the functions and technologies within the operators and network domains. It makes individual processes, assets and functions programmable – again, linking them with signals from other parts of the ecosystem – whether an external customer or partner or internal users.
  • The growing dialogues around edge computing and private networks –evolving ways for enterprise customers to take control of all or part of their connected technologies.
  • The importance of AI and automation, both within operators and across the market. The nature of automation is to connect one technology or data source to another. An action in one place is triggered by a signal from another.

Many of these connecting technologies are still relatively nascent and incomplete at this stage. They do not yet deliver the experiences or economics that will ultimately make them successful. However, what they collectively reveal is that the underlying drive to connect technologies to make better use of resources is like a form of economic gravity. In the same way that water will always run downhill, so will the market evolve towards optimising the use of resources through connecting technologies.

Table of contents

  • Executive Summary
    • The birth of a new sector: ‘Connected technologies’
    • Old gripes remain
    • So what if you are in a new industry?
    • You might like it
    • How to go from telco to connected techco
    • Next steps
  • Introduction
  • Strategy: Does the industry know where it’s going?
    • Where will the money come from?
    • Telcos still demanding their “fair share”, but what’s fair, or constructive?
    • Hope for the future
  • Transformation leadership: Ecosystem practices
    • Current drivers for ecosystem thinking
    • Barriers to wider and less linear ecosystem practices
    • Conclusion
  • Energy crisis sparks efficiency drive
    • Innovation is happening around energy
    • Orange looks to change consumer behaviour
    • Moves on measuring enablement effects
    • Key takeaways
  • Telco Cloud: Open RAN is important
    • Brownfield open RAN deployments at scale in 2024-25
    • Acceleration is key for vRAN workloads on COTS hardware
    • Energy efficiency is a key use case of open RAN and vRAN
    • Other business
    • Conclusion
  • Consumer: Where are telcos currently focused?
    • Staying relevant: Metaverse returns
    • Consumer revenue opportunities: Commerce and finance
    • Customer engagement: Utilising AI
  • Enterprise: Are telcos really ready for new business models?
    • Metaverse for enterprise: Pure hype?
    • Network APIs: The tech is progressing
    • …But commercial value is still unclear
    • Final takeaways:
  • Private networks: Coming over the hype curve
    • A fragmented but dynamic ecosystem
    • A push for mid-market adoption
    • Finding the right sector and the right business case
  • Edge computing: Entering the next phase
    • Telcos are looking for ways to monetise edge
    • Edge computing and private networks – a winning combination?
    • Network APIs take centre stage
    • Final thoughts
  • AI and automation: Opening up access to operational data
    • Gathering up of end-to-end data across multiple-domains
    • Support for network automations
    • Data for external use
    • Key takeaways

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Transport and logistics: The role of private 4G/5G

A deep-dive into the transport and logistics sector

This report is a deep-dive into the transport and logistics vertical for private 4G/5G (P5G) cellular networks. It is intended to be both a specific examination of an important sector of opportunity for P5G and a more general example of the complexity of major industrial sectors, especially campus-based or larger-scale dedicated environments. It also covers opportunities for MNOs, and some of the public 5G angles, with additional references to alternative wireless networks such as Wi-Fi and satellite connectivity.

Often technology product and marketing executives think of industry sectors as monolithic (“finance”, “retail”, “oil and gas”, etc.), typically aligning with familiar industry classification codes. The truth is that each industry has multiple sub-sectors and varied site types, numerous applications, several user-groups, arrays of legacy systems and technology vendors, and differing attitudes and affordability of wireless solutions. This is especially true of transport and logistics, where railway stations share only limited technology or use case overlap with airports, or distribution warehouses.

The transport sector is further complicated by its overlap with the public sector – not only does it constitute an important part of countries’ critical national infrastructure, but in many cases major transport firms have a history of state ownership, or are still owned and run by governments today.

There are also numerous sector-specific regulatory angles, which often translate to conservatism about technology, and a tendency to develop custom solutions and standards. Investment cycles can be very long and sometimes politicised, with assets often expected to be in place for decades. On the positive side, the strategic importance of transport can mean that the sector receives special attention in areas such as spectrum allocations.

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Definition of the transport and logistics sector

There are numerous transport and logistics sub-sectors and site types covered in this report. Although there are some common features and market drivers, there are also clear differences in locations’ physical size and layout, as well as equipment and application platforms, legacy/alternative wireless technologies, regulatory oversight and technology conservatism.

Multiple sub-sectors for transport / logistics vertical

The key domains covered include:

  • Transportation hubs, which refers to sites like ports, airports, stations and railyards. They vary significantly in size.
  • Logistics, which relates to the centralised facilities for shipping, storage and sorting of containers and packages, such as warehouses and fulfilment / distribution centres. It also encompasses the wide-area / global transport of containers, packages and bulk products on trucks, trains and ships.
  • Transport networks including rail networks, metropolitan transit and light-rail systems, and road networks.

There are also often hybrid sites, such as FedEx’s huge logistics hub sites next to Memphis and Indianapolis airports.

In addition, there is also significant overlap with various other sectors, such as major manufacturing sites. For instance, aerospace manufacture and maintenance typically occurs at combined factories/airfields such as Boeing and Airbus’ facilities. Similar combined operations occur in ship-building and train production. Mining, steel and cement companies may even have their own private rail-lines, from remote sites or industrial zones, to multi-modal transit hubs at ports or cities.

For logistics sites, it should be noted that many facility owners also have large retail networks (such as Costco and Walmart), or other sites such as Amazon’s AWS datacentres. Those ancillary operations and their specific applications are not directly included here.

For metropolitan transit, various transport-related facilities may be under the ownership or control of local government and municipal bodies. Similar overlaps between transport-related sites and government occur for military, public safety and other agencies.

Transport / logistics intersects with several adjacent verticals

Sector trends and drivers affecting private networks

This report is not the appropriate venue for a full analysis of the transport and logistics industry, which is made up of multiple sub-sectors, as discussed above.

However, the demand for private networks for these sectors is ultimately driven by a number of top-level national and global changes, in addition to certain local factors such as political support for new metro transit systems, “free ports” or enterprise zones, or efforts to modernise railway networks.

Broadly speaking, these all create a greater requirement for connectivity, control and information flows – which then translates to more 4G and 5G networks, as well as Wi-Fi, fibre and wide-area network services. There are also various new greenfield infrastructure projects, which lend themselves well to ground-up design of fit-for-purpose communications systems.

Some of the key megatrends spanning all aspects of logistics and transportation include:

  • Automation and robotics: As discussed throughout this report, transport hubs and warehouses are becoming much more automated. Although mechanisation via port cranes, baggage-handling systems and automated guided vehicles is not new, the systems are being enhanced rapidly. In particular, sorting or control systems, robots and other forms of automation are using wireless video cameras for detecting packages, enabling remote-control by tele-operators and many other uses.
  • Data and analytics: Transport and logistics companies are at the forefront of data-rich applications, from digital twins of jet engines and rail locomotives, to optimised scheduling and packaging of goods in fulfilment warehouses. Better-connected equipment, IoT sensors and video input can improve turnaround times, reduce shipment errors, reduce energy consumption and much more. Passenger-led transportation should face fewer delays, more dispersed crowds and improved customer service.
  • Predictive maintenance and asset management: Transport systems are capital-intensive. The cost of downtime for a vehicle – or critical system in a warehouse or airport terminal – can be huge. There is a huge opportunity for using networked information and sensors to enable predictive maintenance – i.e. fixing emergent problems before they become critical, or scheduling regular maintenance when it is needed rather than just based on a generic schedule. For instance, anomalous readings from vibration and temperature sensors can give early warnings of issues. There are also obvious safety benefits in areas such as aviation and maritime fault-diagnosis.
  • Improved employee safety and productivity: There is far less tolerance of industrial accidents than in the past. Using automation and better information, transportation and logistics firms are looking to increase worker productivity at the same time as improving safety. This spans many aspects, from ensuring safe distances between workers and vehicles, to rapid reaction to any incident, plus improved recordkeeping and training. Reliable communication is essential, using both voice (often push-to-talk) and an increasing need for video communications and mobile access to enterprise application.
  • Climate change and decarbonisation: Over the next decade, many transport and logistics businesses will face profound change as the planet heads towards net zero carbon emissions. Ports, airports, distribution centres and other sites are likely to need new electrical sources such as wind and solar, onsite battery storage, maybe hydrogen facilities and fleets of electric (often autonomous) site vehicles and machines. Connectivity will be needed for all of this, plus energy use monitoring, control, data-collection and reporting.
  • Geopolitics, re-shoring and supply-chain resilience: Recent events such as the US-China trade war, the COVID pandemic and the Russia/Ukraine war have highlighted the risks of global (and often fragile) supply chains to disruptive external events. Traffic and passenger levels at many airports fell to 20% of pre-pandemic levels or lower. While demand is now recovering in many places, other issues have emerged as well – from economic fluctuations, to fuel price inflation and staffing shortages. As well as localised production, shipping and logistics will need to be much more efficient, automated and connected in order to re-route shipments, store inventory and deal with new paperwork and compliance requirements.
  • Cybersecurity: Transport hubs and warehouses are part of national critical infrastructure. The rise of automation and cloud-based functions poses security challenges as well as gains from efficiency. Old IT, network and operational systems will be strengthened or retired if they have vulnerabilities, while networks will need extra resilience and redundancy. Wireless networks may be used as backups in case of failure of fibre or other links.
  • New business models and vertical integration: Many transport companies are looking to extend their reach into adjacent industries, or via vertical integration within their own domain. Companies such as FedEx and UPS, as well as eCommerce players such as Amazon, have their own fleets of planes and on- or near-airport warehouse facilities. Rail companies are exploring new mixed use retail and office properties integrated with stations. Some are deploying dedicated energy infrastructure, ranging from solar farms to hydrogen electrolysis. All these facilities may be built as greenfield developments, with the project considering the latest connectivity options for IoT or other uses.
  • Enhanced customer / passenger experience: Both individual travellers and freight shippers have an expanded set of choices for travel and transport of goods. They make decisions not just on price, but also reliability / predictability, as well as up-to-date information about status and disruptions. There are expectations for easy Internet access, online portals for reservation and check-in, use of digital sign-boards onsite, accurate cargo tracking and condition-monitoring, simpler border and customs processes, and safe/secure travel environments. They also expect multi-modal transport to be made easier, with interchanges made more convenient and transparent for both goods and personal travel.

Transport / logistics megatrends and implications for connectivity

Source: STL Partners

Table of content

  • Executive Summary
    • Overview
    • Recommendations for traditional mobile operators
    • Recommendations for transportation operators
    • Recommendations for logistics companies
    • Recommendations for regulators and policymakers
    • Recommendations for vendors
  • Introduction
    • Definition of the transport and logistics sector
    • Sector trends and drivers affecting private networks
  • Use cases for 4G/5G in transport and logistics
    • Scale of transport sites and private networks
    • General use cases for private 5G in transport / logistics
    • Sector-specific issues and use cases for private networks
  • Building and running transport private networks
    • Supply-side evolution
    • Private vs. public cellular networks in transport
    • New service provider classes and delivery models
    • The vendor landscape
    • Regulatory and policymaking considerations
    • Wi-Fi, satellite and other wireless technologies
  • Conclusions and recommendations
    • Conclusion and long-term futures
    • Takeouts for traditional MNOs and telcos

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Enterprise Wi-Fi 6/7 is here to stay: 5G is not enough

Overview of Wi-Fi 6/7 for enterprises

This report is not a traditional analyst report on Wi-Fi covering market segments, shares and forecasts. Numerous peer organisations have a long tradition of quantitative marketing modelling and prediction; we are not intending to compete with them. For illustration purposes, we have used a couple of charts with the kind permission of Chris DePuy from 650 Group presented at a recent Wi-Fi Now conference, during a joint panel session with the author of this report.

Instead, this report looks more at the strategic issues around Wi-Fi and the enterprise – and the implications and recommendations for CIOs and network architects in corporate user organisations, opportunities for different types of CSPs, important points for policymakers and regulators, plus a preview of the most important technical innovations likely to emerge in the next few years. There may be some differences in stance or opinion compared to certain other STL reports.

The key themes covered in this report are:

    • Background to enterprise Wi-Fi: key uses, channels and market trends
    • Understanding “Wi-Fi for verticals”
    • Decoding the changes and new capabilities that come with Wi-Fi 6, 6E and 7
    • How and where public and private 5G overlaps or competes with Wi-Fi
    • CSP opportunities in enterprise Wi-Fi
    • Wi-Fi and regulation – and the importance of network diversity.

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Wi-Fi’s background and history

Today, most readers will first think of Wi-Fi as prevalent in the home and across consumer devices such as smartphones, laptops, TVs, game consoles and smart speakers. In total, there are over 18 billion Wi-Fi devices in use, with perhaps 3-4bn new products shipping annually.

Yet the history of Wi-Fi – and its underlying IEEE802.11 technology standards – is anchored in the enterprise.

The earliest incarnations of “wireless ethernet” in the 1990s were in sectors like warehousing and retail, connecting devices such as barcode scanners and point-of-sale terminals. Early leaders around 2000-2005 were companies such as Symbol, Proxim, 3Com and Lucent, supplying both industrial applications and (via chunky plug-in “PCMCIA” cards) laptops, mostly used by corporate employees.

During the 2003-2010 period, Wi-Fi exploded for both enterprises and (with the help of Apple and Intel) consumer laptops, and eventually early smartphones based on Windows and Symbian OS’s, then later iOS and Android.

The corporate world in “carpeted offices” started deploying more dedicated, heavyweight switched systems designed for dense networks of workers at desks, in meeting rooms and in cubicles. Venue Wi-Fi grew quickly as well, with full coverage becoming critical in locations such as airports and hotels, both for visitors and for staff and some connected IT systems. A certain amount of outdoor Wi-Fi was deployed, especially for city centres, but gained little traction as it coincided with broader coverage (and falling costs) of cellular data.

A new breed of enterprise Wi-Fi vendors emerged – and then quickly became consolidated by major networking and IT providers. This has occurred in several waves over the last 20 years. Cisco bought Airespace (and later Meraki and others), Juniper bought Trapeze and Mist Systems, and HP (later HPE) acquired Aruba. There has also been some telecom-sector acquisitions of Wi-Fi vendors, with Commscope acquiring Ruckus, and Ericsson buying BelAir.

While telcos have had some important roles in public or guest Wi-Fi deployments, including working with enterprises in sectors such as cafes, retail, and transport, they have had far less involvement with Wi-Fi deployed privately in enterprise offices, warehouses, factories, and similar sites. For the most part that has been integrated with the wired LAN infrastructure and broader IT domain, overseen by corporate IT/network teams and acquired via a broad array of channels and systems integrators. For industrial applications, many solution providers integrate Wi-Fi (and other wireless mechanisms) directly into machinery and automation equipment.

Looking to the future, enterprise Wi-Fi will coexist with both public and private 5G (including systems or perhaps slices provided by telcos), as well as various other wireless and fibre/fixed connectivity modes. Some elements will converge while others will stay separate. CSPs should “go with the grain” of enterprise networks and select/integrate/operate the right tools for the job, rather than trying to force-fit their preferred technical solution.

Roles and channels for enterprise Wi-Fi

Today, there are multiple roles for Wi-Fi in a business or corporate context. The most important include:

  • Traditional use in offices, both for normal working areas and shared spaces such as meeting and conference rooms. There is often a guest access option.
  • Small businesses use Wi-Fi extensively, as many workers rely on laptops and similar devices, plus vertical-specific endpoints such as payment terminals. Often, they will obtain Wi-Fi capabilities along with their normal retail business broadband connection from a service provider. This may include various types of guest-access option. Common use of shared buildings such as multi-tenant office blocks or retail malls means there may be a reliance on the landlord or site operator for network connectivity.
  • Working from home brings a wide range of new roles for Wi-Fi, especially where there is an intersection of corporate applications and security, with normal home and consumer demand. A growing range of solutions targets this type of converged situation.
  • Large visitor-led venues such as sports stadia, hotels and resorts are hugely important for the Wi-Fi industry. They often have guests with very high expectations of Wi-Fi reliability, coverage, and performance – and also often use the infrastructure themselves for staff, displays and various IoT and connected systems.
  • Municipal and city authorities have gone through two or more rounds of Wi-Fi deployments. Initial 2010-era visions for connectivity often stalled because of a mismatch between usage at the time (mostly on laptops, indoors) and coverage (mostly outdoors). Since then, the rise of smartphone ubiquity, plus a greater array of IoT and smart city devices has made city-centre Wi-Fi more useful again. Increasingly, it is being linked to 5G small cell deployments, metro fibre networks – and made more usable with easier roaming / logon procedures. Some local authorities’ scope also covers Wi-Fi use within education and healthcare settings.
  • Public Wi-Fi hotspots overlap with various enterprise sectors, most notably in transport, cafes/restaurants and hospitality sectors. Where organisations have large venues or multiple sites, such as chain of cafes or retail outlets, there is likely to be some wider enterprise proposition involved.
  • The transport industry is a hugely important sector for enterprise Wi-Fi solutions. Vehicles themselves (buses, planes, trains, taxis) require connectivity for passengers, while transport hubs (airports, stations, etc.) have huge requirements for ease-of-access and performance for Wi-Fi.
  • Wi-Fi technology is also widely used as the basis for fixed-wireless access over medium-to-wide areas. Sometimes using vendor-specific enhancements, it is common to use unlicenced spectrum and 802.11-based networks for connectivity to rural businesses or specific fixed assets. A new version of Wi-Fi technology (802.11ah HaLow) also allows low-power wide area applications for sensors and other IoT devices, which can potentially compete against LoRa and 4G NB-IoT, although it is very late to the market.
  • Niche applications for Wi-Fi technology also exist, for example backhauling other wireless technologies such as Bluetooth, for in-building sensing and automation. There are also emerging propositions such as using high-capacity 60GHz Wi-Fi to replace fibres and cabling inside buildings, especially for rapid installation or in environments where drilling holes in walls requires permits.

Enterprise Wi-Fi solutions cover a broad range of contexts and uses

Given the range of Wi-Fi enterprise market sectors and use cases, it is unsurprising that there are also multiple ways for companies and organisations to obtain the infrastructure, as well as operate the connectivity functions or services.

Some of the options include:

  • Self-provision: Many large organisations will source, install, and operate their own Wi-Fi networks via their IT and networking teams, as they do for fixed LAN and sometimes WAN equipment. They may rely on vendor or outsourced support and specific tasks such as wiring installation.
  • Broadband CSP: Especially for smaller sites, Wi-Fi is often obtained alongside business broadband connectivity, perhaps from an integrated router managed by the ISP.
  • Enterprise MSP: Larger businesses may use dedicated enterprise-grade service providers for their Internet connections, UCaaS services, SD-WAN / SASE networks and so on. These organisations may also provide on-site Wi-Fi installation and management services, or work with sub-contractors to deliver them.
  • Solution providers: Various IT and OT systems, such as building management systems or industrial automation solutions, may come with Wi-Fi embedded into the fabric of the proposition.
  • Managed Wi-Fi specialists: Especially for visitor-centric locations like transport hubs, Wi-Fi coverage and operation may be outsourced to a third party managed service operator. They will typically handle the infrastructure (and any upgrades), authentication, security and backhaul on a contractual basis. They will also likely provide staff/IoT connections as well as guest access.
  • Network integrators: Enterprises may obtain Wi-Fi installations as a one-off project from a network specialist (perhaps with separate maintenance / upgrade agreements). This may well be combined with fixed LAN infrastructure and other relevant elements. This may also be a channel for hybrid Wi-Fi / private cellular in future.
  • Vertical specialists: Various industries such as hotels, aviation, hospitals, mining and so on will often have dedicated companies catering to sector-specific needs, standards, regulations, or business practices. They may tie together various other technology elements, such as IoT connections, asset tracking, voice communications and so forth, using Wi-Fi where appropriate.
  • In-building wireless specialists: Various companies specialise in both indoor cellular coverage systems and Wi-Fi. Often linked to tower companies or neutral-host business models.

Table of Contents

  • Executive Summary
  • Introduction
    • Structure and objectives of this report
    • Background and history
    • Roles and channels for enterprise Wi-Fi
    • Recent enterprise Wi-Fi market trends
    • Note on terminology
  • The evolution of “Wi-Fi for verticals”
    • Understanding Wi-Fi “verticals”
    • Existing vertical-specific Wi-Fi solutions
    • Wi-Fi in industry verticals – building ecosystems
  • Wi-Fi 6, 6E & 7: Rapid cadence or confusion?
    • Continual evolution of Wi-Fi capabilities: 6, 6E, 7
    • Wi-Fi 7 may be a game-changer for enterprise
    • The long-term future: Wi-Fi 8 and beyond
    • Other Wi-Fi variants: 60GHz and HaLow
  • Where do Wi-Fi and 5G overlap competitively?
    • Does private 5G change the game?
    • Convergence / divergence
  • The political and regulatory dimensions of enterprise wireless
    • 6GHz spectrum
  • CSPs and enterprise Wi-Fi
    • CSPs and large enterprise / industrial Wi-Fi
    • Wi-Fi service value-adds
    • Wi-Fi and edge compute
  • Conclusions

Related research

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6G: Hype versus reality

What is 6G and why does it matter?

Who’s driving the 6G discussion?

There already are numerous 6G visions, suggested use-cases and proposed technical elements. Many reflect vendors’ or universities’ existing specialist research domains or IPR in wireless, or look to entrench and extend existing commercial models and “locked-in” legacy technology stacks.

Others start from broad visions of UN development goals and policymakers’ desires for connected societies, and try to use these to frame and underpin 6G targets, even if the reality is that they will often be delivered by 5G, fibre or other technologies.

The stakeholder groups involved in creating 6G are wider than for 5G – governments, cloud hyperscalers / tech-co’s, industrial specialists, NGOs and many other groups seem more prominent than in the past, when the main drivers came from MNOs, large vendors and key academic clusters.

Over time, a process of iteration and “triangulation” will occur for 6G, initially starting with a wide funnel of ideas, which are now starting to coalesce into common requirements – and then to specific standards and underlying technical innovations. By around 2024-25 there should be more clarity, but at present there are still many directions that 6G could take.

What are they saying?

Discussions with and available material from parties interested in 6G discusses a wide range of new technologies (e.g. ultra-massive MIMO) and design goals (e.g. speeds of 1Tbps). These can be organised into six categories to provide a high-level set of futuristic statements that underpin the concept of 6G,  as articulated by the various 6G consortia and governing bodies:

  1. Provision of ultra-high data rate and ultra-low latency: Provision of up to 1Tbps speeds and as low as 1 microsecond latency – both outdoors and – implicitly at least – indoors.
  2. Use of new frequencies and interconnection of new network types: Efficient use of high, medium, and low-frequency bands, potentially including visible light and >100GHz and even THz spectrum. This will include possible coordination between non-terrestrial networks and other existing networks, and new types of radio and antenna to provide ubiquitous coverage in a dispersed “fabric” concept, rather than traditional discrete “cells”.
  3. Ultra-massive MIMO and ultra-flexible physical and control layers: The combination of ultra-large antenna arrays, intelligent surfaces, AI and new sensing technologies working in a range of frequency bands. This will depend on the deployment of a range of new technologies in the physical and control layers to increase coverage and speed, while reducing cost and power consumption.
  4. High resolution location: The ability to improve locational accuracy, potentially to centimetre-level resolutions, as well as the ability to find and describe objects in 3D orientation.
  5. Improved sensing capabilities: Ability to use 6Gradio signals for direct sensing applications such as radar, as well as for communications.
  6. General network concepts: A variety of topics including the concept of a distributed network architecture and a “network of networks” to improve network performance and coverage. This also includes more conceptual topics such as micro-networks and computing aware networks. Finally, there is discussion on tailoring 6Gfor use of / deployment by other industries beyond traditional telcos (“verticals”), such as enhancements for sectors including rail, broadcast, agriculture, utilities, among others, which may require specific features for coverage, sector-specific protocols or legacy interoperability.

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How is 6G different to 5G?

In reality, the boundaries between later versions of 5G and 6G are likely to be blurred, both in terms of the technology standards development and in the ways marketers present network products and services. As with 5G, the development of 6G will take time to reach many of the goals above. From 3GPP Release 18 onwards, 5G is officially being renamed as “5G Advanced”, mirroring a similar move in the later stages of 4G/LTE development. Rel18 standards are expected to be completed around the end of 2023, with preliminary Rel19 studies also currently underway. Rel20 and Rel21 will continue the evolution.

Figure 1: Roadmap for 6G

Source: Slides presented by Bharat B Bhatia President, ITU-APT Foundation of India at WWRF Huddle 2022

However, from 2024 onwards, the work done at 3GPP meetings and in its various groups will gradually shift from enhancing 5G to starting the groundwork for 6G – initially defining requirements in 2024-25, then creating “study items” in 2025-26. During that time, new additions to 5G in Rel20/21/22 will get progressively thinner as resources are devoted to 6G preparations.

The heavy lifting efforts on “work items” for 6G will probably start around 2026-27, with 5G Advanced output then dwindling to small enhancements or maintenance releases. It is still unclear what will get included in 5G Advanced, versus held over until 6G, but the main emphasis for 6G is likely to be on:

  • Greater performance and efficiency for mobile broadband, with attention paid to MIMO techniques, better uplink mechanisms and improved cell-to-cell handover
  • Additional features for specific verticals, as well as V2X deployments and IoT
  • Support of new spectrum bands
  • Improvements in mapping and positioning
  • Enhanced coverage and backhaul, for instance by establishing “daisy-chains” of cell sites and extensions and repeaters, including using 5Gfor backhaul and access
  • More intelligence and automation in the 5Gnetwork core, including improvements to slicing and orchestration
  • Better integration of non-terrestrial networks, typically using satellites or high-altitude platforms
  • Capabilities specifically aimed at AR/VR/XR
  • Direct device-to-device connections (also called “sidelink”) that allow communication without the need to go via a cell tower.

We can expect these 5G Advanced areas to also progress from requirements, to study, and then to work items during the period from 2022-27.

However, these features will mostly be an evolution of 5G, rather than a revolution by 5G. While there may be a few early moves on areas such as wireless sensing, Releases 18-21 are unlikely to include any radical breakthroughs. The topics we discuss elsewhere in this report, such as potential use of terahertz bands, blending of O-RAN principles of disaggregation, and new technology domains such as smart surfaces, will be solidly in the 6G era.

An important point here is that the official ITU standard for next-gen wireless, likely to be called IMT2030, is not the same as 3GPP’s branding of the cellular “generation”, or individual MNOs service names. There may well be early versions of 6G cellular, driven by market demand, that don’t quite match up to the ITU requirements. Ultimately 3GPP is an industry-led organisation, so may follow the path of expediency if there are urgent commercial opportunities or challenges.

In addition, based on the experience of 4G and 5G launches, it is probable that at least one MNO will try to call a 5G Advanced launch “6G” in their marketing. AT&T caused huge controversy – and even lawsuits – by calling a late version of LTE “5Ge” (5G evolution), even including the icons on some phones’ screens, while Verizon’s early 5G FWA systems were actually a proprietary pre-standard version of the technology.

If you’re a purist about these things – as we are – prepare to be howling in frustration around 2027-28 and describing new services as “fake 6G”.

Table of Contents

  • Executive Summary
    • What is 6G?
    • Key considerations for telcos and vendors around 6G
    • What should telcos and vendors do now?
    • 6G capabilities: Short-term focus areas
    • Other influencing factors
  • What is 6G and why does it matter?
    • Who’s driving the 6G discussion?
    • What are they saying?
    • The reality of moving from 5G Advanced to 6G
    • Likely roll out of 6G capabilities
  • Regulation and geopolitics
    • The expected impact of regulation and geopolitics
    • Summary of 6G consortiums and other interested parties
  • 6G products and services
  • Requirements for 6G
    • AI/ML in 6G
    • 6G security
    • 6G privacy
    • 6G sustainability
  • Drivers and barriers to 6G deployment
    • Short-term drivers
    • Short-term barriers
    • Long-term drivers
    • Long-term barriers
  • Conclusion: Realistic expectations for 6G
    • The reality: What we know for certain about 6G / IMT2030
    • Possibilities: Focus areas for 6G development
    • The hype: Highly unlikely or impossible by 2030

Related research

 

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Airports: The roles of 5G & private networks

A deep dive into private networks for the aviation vertical

This report is intended to be both a specific examination of an important sector of opportunity for Private 5G (P5G) and an example of the complexity of major industrial sectors and campus-based environments. It also covers opportunities for MNOs.

Airports have been among the earliest sites for private cellular and remain a major focus for vendors and service providers, as solutions mature and spectrum options proliferate. They already generate huge investments into public cellular (indoor and outdoor) as well as being headline sites for Wi-Fi deployment and use. They also employ dozens of other wireless technologies, from radar to critical voice communications.

In the case of airports, the largest are so large and diverse that they actually resemble cities, with “private” networks serving an environment actually quite similar to a small national operator or regional MNO. For example, Dallas Fort-Worth airport spans 27 square miles – larger than the island of Manhattan or the principality of San Marino. They may have 100s of companies as tenants, and 10000s of employees – as well as passengers, vehicles and IoT devices. This may mean that they end up with multiple private wireless networks in different parts of the airfield – from the passenger terminal to maintenance hangars to hotels, to the car-rental facility.

They are also intensive Coordination Age ecosystems. Their effective operation involves the safe and secure management of millions of physical and digital assets across multiple parties, billions of dollars, and many lives.

Often technology product and marketing executives think of industry sectors as monolithic (“finance”, “retail”, “oil and gas” etc), typically aligning with familiar industry classification codes. The truth is that each industry has multiple sub-sectors and varied site types, numerous applications, several user-groups, arrays of legacy systems and technology vendors, and differing attitudes and affordability of wireless solutions.

STL Partners hopes that this exercise examining airports will prompt suppliers and operators to drill into other vertical sectors in similar depth. Depending on the response to this type of document, we may well write up other areas in similar fashion in future. (We are also available for private analysis projects).

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Sector trends and drivers affecting private 5G networks

This report is not the appropriate venue for a full analysis of the aviation and airport industry. However, a number of top-level trends are important to understand, as there is a fairly direct link to the deployment of cellular technologies and private 4G/5G.

Trends for airlines

Before the pandemic, there was a sustained growth in worldwide air-passenger traffic, fuelled by the growth of Chinese and Indian middle-classes, as well as inter-regional and long-haul flights in and between Europe, Asia, the Americas and the Middle East. Forecasts were continued for growth, with air-freight also increasing alongside passenger numbers.

This growth resulted in numerous impacts on aviation more broadly:

  • Construction of many entirely new airports, along with extra terminals and refurbishments at established sites. Examples have included immense new airports at Beijing, Doha and Istanbul. These developments typically include huge focus on efficiency, IoT and safety – all heavily reliant on connectivity.
  • Low-cost and “basic” airlines such as Southwest, EasyJet, AirAsia and others have grown rapidly (at least pre-pandemic). Some have built dedicated terminals. Many have a huge focus on fast “turns” of aircraft between arrival and departure. This needs enhanced coordination and communications between multiple ground-service providers to manage 50+ tasks, from baggage unloading to cleaning and refuelling.
  • Established airlines focusing on greater efficiency, novel route choices, new hub airports, better customer satisfaction via information and interactivity throughout their journeys, as well as pushing ancillary services such as contract maintenance. Again, connectivity plays a variety of roles, from hangars to in-flight wireless.
  • Major warehousing and logistics centres built at airports for companies such as Fedex and UPS, as well as eCommerce players such as Amazon starting to build fleets of planes and on- or near-airport facilities. These typically feature high levels of automation and wide use of robotics.
Long-term air passenger growth (pre-pandemic)

Long-term air passenger growth (pre-pandemic)

Airports as “hubs” for multiple businesses

Many airports now operate on-site business centres, hotels, large retail facilities – as well as growing sophistication of air-freight, contract maintenance services and aircraft refits. Each is often a business in its own right, with separate buildings – but must also coordinate with the central airport authority in terms of security, traffic, signage and vehicle movements.

As well as their own internal connectivity requirements for employees and a growing range of IoT systems, the site-owners are also responsible for wired and wireless links for stakeholders such as:

  • Transportation companies
    • Airlines, both within the terminals and at hangars / warehouses and nearby offices.
    • Shipping agents and freight forwarders
    • Logistics and package-delivery firms
  • Services providers
    • National mobile network operators
    • Retailers and other concessions
    • Vehicle rental agencies
    • Bus, rail, taxi & tour companies
    • Caterers
    • Fuel companies
    • Security firms
    • On-site hotels, warehouses and business parks
    • Insurance and finance organisations
  • Operations and public safety
    • Police and firefighters
    • Medical services
    • Air / port traffic control
    • Power and lighting providers
    • Construction contractors

Many of these groups could potentially justify their own investments in private cellular networks (as well as indoor coverage and Wi-Fi if they have dedicated buildings). An open question is whether airport authorities will try to deploy fully campus-wide networks, or whether a diverse array of separate infrastructures will emerge organically.

Industry transformation, automation and IoT-led innovation

As well as the airlines, the airport authorities have become ever-more focused on technology of the site overall. They are aware of operational efficiency, security and safety – and increasing the potential to earn extra revenues from passengers. A very broad array of existing and new use-cases are leaning on improved connectivity, such as:

  • In-building coverage (and huge capacity) for passengers and workers, all of whom expect both multi-network cellular and ubiquitous Wi-Fi availability
  • Prolific use of digital sign-boards for passengers, staff, plane/ship crews etc
  • Freight-tracking, including details about pallets and containers
  • Security cameras and sensors
  • Smart lighting for runways, loading areas and local roadways
  • Support of complex and mission-critical baggage-handling systems
  • Border and customs functions, including automated passport scanners with video analytics
  • “Smart building” technology ensuring optimal use of ventilation, heating, lighting and safety sensors
  • Robotic and remote-controlled vehicles, such as tugs or drones
  • Voice communications systems, now evolving from 2-way radios to cellular-based systems
  • Maintenance systems for aircraft in hangars – increasingly with high-definition video inspections, augmented reality for engineers, and strict requirements on documentation and record-keeping.

Security and safety concerns

Airports have always had to contend with security issues, from immigration to fire-safety, anti-terrorism, theft and smuggling operations. This has required continued evolution of screening systems, cameras, staff access control and multiple layers of analytics software.

This translates to private cellular in a number of ways:

  • Desire to update legacy critical communications systems (e.g. TETRA radios) to more-capable LTE or 5G equivalents, to enable data, video and other applications.
  • Requirement for networks with a bias towards data uplink rather than downlink, especially for HD video and other security  This may mean a preference for separate frequencies to the public networks, in order to accommodate a different mix of up/down traffic.
  • Involvement of a wide range of systems integrators and critical communications specialists with a long history of deploying reliable wireless  Many are adopting 4G and 5G skill-sets internally.
  • Requirement for 100% coverage of the airport environment, both indoors and outdoors as far as the perimeter fence. This may be outside the coverage of many public networks, especially for higher-frequency 5G

Complex wireless environment

It is important to recognise that airfields have a huge array of different technology systems, many of which depend on radio communications or other electromagnetic use-cases. Some of these – such as radars – can occupy frequency bands quite close to those used for 4G or 5G mobile. There are also assorted niche applications, for air traffic control, critical communications among ground workers and emergency services, satellite connectivity for aircraft, scientific instruments for weather forecasting and many others. Wi-Fi is used intensively, both inside the terminal and across some outdoor areas. Some airports have sections used by the military as well as civil aviation, with yet another group of radio types and frequencies employed.

This has several implications:

  • Unlike many other sites, cellular communications is not the most important use of spectrum  Mobile networks – whether public or private – need to fit alongside a huge variety of other services and functions.
  • Some frequency bands that are offered by regulators on a local basis for private 4G/5G may not be available for licensing at airports, as there may be important incumbent users.
  • Airports take increasing interest in overall spectrum management tools, as well as site surveys and the ability to intervene rapidly in case of problems.
  • The aviation industry has a large number of wireless and RF specialists, some of whom are likely to be cross-trained in cellular  This makes it more capable than many sectors to adopt private networks rather than always relying on public MNO service.

Covid-19 Pandemic

Since early 2020, the aviation and airline sector has been decimated by travel restrictions imposed because of the pandemic. Traffic and passenger levels at many airports fell to 20% of pre-pandemic levels or lower. However, as vaccination programs enable the re-opening of travel, growth is starting to occur again.

Various after-effects of the pandemic will increase the need for automation, connectivity and communications. There are new security-checks on vaccination and testing status, more cameras for fever-detection and mask-compliance, automated sanitising of surfaces and much more. Many airports have needed to reconfigure the layouts of their terminals to accommodate testing centres, facilitate social distancing, or sometimes close areas in order to reduce costs. This puts a premium on wireless connectivity that can be adapt to new circumstances rapidly.

Another impact of the last 2 years has been growth in the importance of cargo shipments, from both dedicated freight terminals and in commercial airliners. This has led to new warehouse facilities being constructed, as well as different types of asset tracking and loading vehicles being employed. Again, this has driven the need for better connectivity.

Table of content

  • Executive Summary
    • Overview
    • Recommendations for Airport Operators & Airlines
    • Recommendations for Mobile Operators
    • Recommendations for Regulators & Policymakers
    • Recommendations for Vendors
  • Introduction
    • Sector trends and drivers affecting private networks
  • Evolving airport use-cases for 4G/5G
    • Understanding airports’ layout
    • Background: Public cellular at airports
    • From public to private connectivity: growth in B2B wireless
    • Specific use-cases for private 4G / 5G at airports
  • Airports – a subset of “campus” networks
    • Characteristics of campus networks
    • Adjacent trends
    • Campus networks: who is responsible?
  • Building & operating airport private networks
    • Supply-side evolution for airport networks
    • Airport stakeholders
    • Monetisation opportunities
    • Airport private network case studies
    • Can public 5G network slicing work instead of private 5G?
    • Where does Wi-Fi & other wireless technology fit?

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Private networks: Lessons so far and what next

The private networks market is rapidly developing

Businesses across a range of sectors are exploring the benefits of private networks in supporting their connected operations. However, there are considerable variations between national markets, reflecting spectrum and other regulatory actions, as well as industrial structure and other local factors. US, Germany, UK, Japan and the Nordics are among the leading markets.

Enterprises’ adoption of digitalisation and automation programmes is growing across various industries. The demand from enterprises stems from their need for customised networks to meet their vertical-specific connectivity requirements – as well as more basic considerations of coverage and cost of public networks, or alternative wireless technologies.

On the supply side, the development in cellular standards, including the virtualisation of the RAN and core elements, the availability of edge computing, and cloud management solutions, as well as the changing spectrum regulations are making private networks more accessible for enterprises. That said, many recently deployed private cellular networks still use “traditional” integrated small cells, or major vendors’ bundled solutions – especially in conservative sectors such as utilities and public safety.

Many new players are entering the market through different vertical and horizontal approaches and either competing or collaborating with traditional telcos. Traditional telcos, new telcos (mainly building private networks or offering network services), and other stakeholders are all exploring strategies to engage with the market and assessing the opportunities across the value chain as private network adoption increases.

Following up on our 2019 report Private and vertical cellular networks: Threats and opportunities, we explore the recent developments in the private network market, regulatory activities and policy around local and shared spectrum, and the different deployment approaches and business cases. In this report we address several interdependent elements of the private networks landscape

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What is a private network?

A private network leverages dedicated resources such as infrastructure and spectrum to provide precise coverage and capacity to specific devices and user groups. The network can be as small as a single radio cell covering a single campus or a location such as a manufacturing site (or even a single airplane), or it can span across a wider geographical area such as a nationwide railway network or regional utility grids.

Private networks is an umbrella term that can includes different LAN (or WAN) connectivity options such as Wi-Fi and LPWAN. However, more commonly, the term is being associated with private cellular networks based on 3GPP mobile technologies, i.e. LTE or 5G New Radio (NR).

Private networks are also different from in-building densification solutions like small cells and DAS which extend the coverage of public network or strengthen its capacity indoors or in highly dense locations. These solutions are still part of the public network and do not support customised control over the local network access or other characteristics. In future, some may support local private networks as well as public MNOs’ services.

Besides dedicated coverage and capacity, private networks can be customised in other aspects such as security, latency and integration with the enterprise internal systems to meet business specific requirements in ways that best effort public networks cannot.

Unlike public networks, private networks are not available to the public through commercially available devices and SIM cards. The network owner or operator controls the authorisation and the access to the network for permissioned devices and users. These definitions blur somewhat if the network is run by a “community” such as a municipality.

Typically, devices will not work outside the boundaries of their private network. That is a requirement in many use cases, such as manufacturing, where devices are not expected to continue functioning outside the premise. However, in a few areas, such as logistics, solutions can include the use of dual-SIM devices for both public and private networks or the use of other wide area technologies such as TETRA for voice. Moreover, agreements with public networks to enable roaming can be activated to support certain service continuity outside the private network boundaries.

While the technology and market are still developing, several terms are being used interchangeably to describe 3GPP private networks such dedicated networks, standalone networks, campus networks, local networks, vertical mobile network and non-public networks (NPN) as defined by the 3GPP.

The emergence of new telcos

Many telcos are not ready to support private networks demands from enterprises on large scale because they lack sufficient resources and expertise. Also, some enterprises might be reluctant to work with telcos for different reasons including their concerns over the traditional telcos’ abilities in vertical markets and a desire to control costs. This gap is already catalysing the emergence of new types of mobile network service providers, as opposed to traditional MNOs that operate national or regional public mobile networks.

These players essentially carry out the same roles as traditional MNOs in configuring the network, provisioning the service, and maintaining the private network infrastructure. Some of them may also have access to spectrum and buy network equipment and technologies directly from network equipment vendors. In addition to “new telcos” or “new operators”, other terms have been used to describe these players such as specialist operators and alternative operators. Throughout this report, we will use new telcos or specialist operators when describing these players collectively and traditional/public operators when referring to typical wide area national mobile network provider. New players can be divided into the following categories:

Possible private networks service providers

private networks ecosystem

Source: STL Partners

Table of content

  • Executive Summary
    • What next
    • Trends and recommendations for telcos, vendors, enterprises and policymakers
  • Introduction
  • Types of private network operators
    • What is a private network?
    • The emergence of new telcos
  • How various stakeholders are approaching the market
    • Technology development: Choosing between LTE and 5G
    • Private network technology vendors
    • Regional overview
    • Vertical overview
    • Mergers and acquisitions activities
  • The development of spectrum regulations
    • Unlicensed spectrum for LTE and 5G is an attractive option, but it remains limited
    • The rise of local spectrum licensing threatens some telcos
    • …but there is no one-size fits all in local spectrum licensing
    • How local spectrum licensing shapes the market and enterprise adoption
    • Recommendations for different stakeholders
  • Assessing the approaches to network implementation
    • Private network deployment models
    • Business models and roles for telcos
  • Conclusion and recommendations
  • Index
  • Appendix 1:  Examples of private networks deployments in 2020 – 2021

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Fixed wireless access growth: To 20% homes by 2025

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Fixed wireless access growth forecast

Fixed Wireless Access (FWA) networks use a wireless “last mile” link for the final connection of a broadband service to homes and businesses, rather than a copper, fibre or coaxial cable into the building. Provided mostly by WISPs (Wireless Internet Service Providers) or mobile network operators (MNOs), these services come in a wide range of speeds, prices and technology architectures.

Some FWA services are just a short “drop” from a nearby pole or fibre-fed hub, while others can work over distances of several kilometres or more in rural and remote areas, sometimes with base station sites backhauled by additional wireless links. WISPs can either be independent specialists, or traditional fixed/cable operators extending reach into areas they cannot economically cover with wired broadband.

There is a fair amount of definitional vagueness about FWA. The most expansive definitions include cheap mobile hotspots (“Mi-Fi” devices) used in homes, or various types of enterprise IoT gateway, both of which could easily be classified in other market segments. Most service providers don’t give separate breakouts of deployments, while regulators and other industry bodies report patchy and largely inconsistent data.

Our view is that FWA is firstly about providing permanent broadband access to a specific location or premises. Primarily, this is for residential wireless access to the Internet and sometimes typical telco-provided services such as IPTV and voice telephony. In a business context, there may be a mix of wireless Internet access and connectivity to corporate networks such as VPNs, again provided to a specific location or building.

A subset of FWA relates to M2M usage, for instance private networks run by utility companies for controlling grid assets in the field. These are typically not Internet-connected at all, and so don’t fit most observers’ general definition of “broadband access”.

Usually, FWA will be marketed as a specific service and package by some sort of network provider, usually including the terminal equipment (“CPE” – customer premise equipment), rather than allowing the user to “bring their own” device. That said, lower-end (especially 4G) offers may be SIM-only deals intended to be used with generic (and unmanaged) portable hotspots.
There are some examples of private network FWA, such as a large caravan or trailer park with wireless access provided from a central point, and perhaps in future municipal or enterprise cellular networks giving fixed access to particular tenant structures on-site – for instance to hangars at an airport.

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FWA today

Today, fixed-wireless access (FWA) is used for perhaps 8-9% of broadband connections globally, although this varies significantly by definition, country and region. There are various use cases (see below), but generally FWA is deployed in areas without good fixed broadband options, or by mobile-only operators trying to add an additional fixed revenue stream, where they have spare capacity.

Fixed wireless internet access fits specific sectors and uses, rather than the overall market

FWA Use Cases

Source: STL Partners

FWA has traditionally been used in sparsely populated rural areas, where the economics of fixed broadband are untenable, especially in developing markets without existing fibre transport to towns and villages, or even copper in residential areas. Such networks have typically used unlicensed frequency bands, as there is limited interference – and little financial justification for expensive spectrum purchases. In most cases, such deployments use proprietary variants of Wi-Fi, or its ill-fated 2010-era sibling WiMAX.

Increasingly however, FWA is being used in more urban settings, and in more developed market scenarios – for example during the phase-out of older xDSL broadband, or in places with limited or no competition between fixed-network providers. Some cellular networks primarily intended for mobile broadband (MBB) have been used for fixed usage as well, especially if spare capacity has been available. 4G has already catalysed rapid growth of FWA in numerous markets, such as South Africa, Japan, Sri Lanka, Italy and the Philippines – and 5G is likely to make a further big difference in coming years. These mostly rely on licensed spectrum, typically the national bands owned by major MNOs. In some cases, specific bands are used for FWA use, rather than sharing with normal mobile broadband. This allows appropriate “dimensioning” of network elements, and clearer cost-accounting for management.

Historically, most FWA has required an external antenna and professional installation on each individual house, although it also gets deployed for multi-dwelling units (MDUs, i.e. apartment blocks) as well as some non-residential premises like shops and schools. More recently, self-installed indoor CPE with varying levels of price and sophistication has helped broaden the market, enabling customers to get terminals at retail stores or delivered direct to their home for immediate use.

Looking forward, the arrival of 5G mass-market equipment and larger swathes of mmWave and new mid-band spectrum – both licensed and unlicensed – is changing the landscape again, with the potential for fibre-rivalling speeds, sometimes at gigabit-grade.

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Table of contents

  • Executive Summary
  • Introduction
    • FWA today
    • Universal broadband as a goal
    • What’s changed in recent years?
    • What’s changed because of the pandemic?
  • The FWA market and use cases
    • Niche or mainstream? National or local?
    • Targeting key applications / user groups
  • FWA technology evolution
    • A broad array of options
    • Wi-Fi, WiMAX and close relatives
    • Using a mobile-primary network for FWA
    • 4G and 5G for WISPs
    • Other FWA options
    • Customer premise equipment: indoor or outdoor?
    • Spectrum implications and options
  • The new FWA value chain
    • Can MNOs use FWA to enter the fixed broadband market?
    • Reinventing the WISPs
    • Other value chain participants
    • Is satellite a rival waiting in the wings?
  • Commercial models and packages
    • Typical pricing and packages
    • Example FWA operators and plans
  • STL’s FWA market forecasts
    • Quantitative market sizing and forecast
    • High level market forecast
  • Conclusions
    • What will 5G deliver – and when and where?
  • Index

What will make or break 5G growth?

5G is a long way from delivering on the hype

This report is a crib sheet outlining the 18 factors that STL Partners believes will have a significant impact on the development of the 5G market. We put forward our core assumption on how we expect each factor to affect the 5G market, and highlight the upside and downside risks to our assumption.

The purpose of the report is to pull together knowledge from across different areas – networks, enterprise services, consumer services, regulatory and commercial environments – to give a holistic view of what we think will influence 5G development. Although everyone in the industry has an eye on how 5G is developing, often this is from a relatively narrow view of the market. But the reality is that over the long term, 5G will not be just another G, but an amalgamation of many emerging and maturing network technologies, increasingly bespoke and fragmented enterprise and consumer demands, with high government expectations for contributions to economic growth. So to understand how quickly or slowly 5G will deliver on these promises, operators, vendors, customers and governments need to consider how a wide range of factors are playing out in their countries. By benchmarking their progress against our core assumptions, upside risks and downside risks, industry players can make a well-rounded assessment of whether they are ahead or behind in 5G development and identify ways to drive the market forward.

This report builds on STL’s extensive coverage of 5G and other enabling technologies:

Key factors influencing 5G development

We have organised the factors affecting 5G development into three categories:

  1. Primary drivers: We believe these will have the greatest impact on 5G development, owing to their influence over the cost and ease of deploying network infrastructure and services, and accessibility and value of 5G connectivity to end-users.
  2. Secondary drivers: These factors have a less direct impact on the 5G market development, especially over the short term, or will only influence a specific part of the market, such as fixed wireless access. However, in some instances telcos have more control over secondary factors than the primary ones, so depending on their strategies, secondary factors could have a disproportionate impact on 5G market development.
  3. Wildcards: These are factors which are less likely or predictable, but that if they do occur would have a decisive impact on how the 5G market (and wider telecoms industry) evolves.

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The 5G-aliser

Over the coming quarters, we will use these 5G factors as a means of measuring progress. The diagram below shows the inaugural 5G-aliser. The top row shows the supply and demand levels for 5G, the middle row shows the absolute level impact of each driver on 5G development, i.e. how important each driver is to 5G growth right now , and the bottom row shows the relative position of each driver. While our intention was to start all drivers at the same relative level, reflecting our core assumption as of March 2020, given the rapid escalation of the COVID-19 pandemic, we have dropped this driver into the red already as we expect telcos’ first priority during the crisis to be on keeping their current operations running smoothly.

The 5G-aliser, March 2020

STL 5G-a-liser March 2020

Source: STL Partners

On a quarterly basis we will monitor the development of the 5G market and update the markers for each driver to reflect the emergence of upside or downside risks, and rising or falling importance of different growth drivers. Evidently, some factors are dependent on local market conditions, so we will also evaluate the drivers on a market by market basis, when important local developments occur.

Table of contents

  • Executive Summary
    • Key takeaways
    • The 5G-aliser
  • Introduction
  • Key factors influencing 5G development
    • Primary drivers
    • Secondary factors
    • Wildcards
  • Conclusions

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5G network slicing: How to secure the opportunity

Network slicing is central to unlocking the 5G opportunity

There has understandably been a lot of talk and hype about 5G and network slicing in the telecoms industry. It promises to bring greater speeds, lower latency, greater capacity, ultra-reliability, greater flexibility in the network operations and more. It also pledges to support high device densities and to enable new services, new business and operational models as well as new vertical opportunities.

Given that the rollout of 5G networks is expected to involve a significant investment of hundreds of billions of dollars, there is a need to look at how it might address new business opportunities that previous generations of cellular networks could not. Many, including us, have argued that the consumer business case for 5G is limited, and that the enterprise segment is likely to represent the greater opportunity.

One highly anticipated aspect of 5G is that it will be built on virtualised infrastructure. Network functions will run as software in datacentres, rather than on dedicated appliances as in the past. This will mean that operators can deploy and make changes to functions with far greater flexibility than ever before. It also offers the promise of enabling multiple logical end-to-end networks – each intended to meet specific needs – to be “spun-up”, operated and retired as required, over the same shared hardware. Traditionally, achieving such a multi-service outcome would have required building dedicated stand-alone networks, which was rarely a viable proposition.  This capability is the essence of network slicing.

Figure 1: Diagram of network slicing

5G network slicing diagram

Source: STL Partners

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This report will explore the concept of network slicing and what it means for enterprise customers. It will have a particular focus on one aspect of network slicing through the enterprise perspective, that being security. The first section will cover how we define network slicing whilst the second will dive into what the enterprise security-related concerns are. We will then assess the implications of these concerns in the third section, before identifying ways that telcos can address these concerns in order to accelerate the adoption of network slicing.

Our findings in this report are informed by a wider STL Partners research programme that STL Partners has conducted with telcos and enterprises across several verticals, including transport, defence, utilities, logistics and smart cities.

Enterprise security concerns with network slicing are rooted in the fear of the new and unknown

Network slicing is inherently complex. Multiple networks being created over common infrastructure, each serving different customers, use cases and devices means that management and orchestration of network slices is something that telcos are still grappling with. It not only represents a change in technology but also a shift in the way that the network lifecycle is managed, which is new and unfamiliar to telcos and their enterprise customers. Current security protocols will not necessarily be equipped to cover many of the new dimensions that network slicing brings. This new shift in the way things work will result in various enterprise security concerns. Changes in the network architecture with slicing, with multiple logical networks each having their own resources and sharing others, also poses questions of how the security architecture needs to evolve in order to address new risks.

Enterprise customers define security as not only about preventing services being compromised by intentional malicious attacks, but also about preventing service degradation or disruption due to unintentional operational or technical failures and/or negligence, unplanned breakdowns etc. Due to the interdependence of slices, even if a fault occurrence happens, it could consume resources in one slice, just like an attack would, which would affect the reliability or lifecycle of other network slices that share the same resources. Regardless of how the performance of a slice gets affected, whether it is by a malicious attack, a natural disaster, a bug or unintentional negligence, the consequences are ultimately the same. These are all, in some way, related to security. Therefore, when considering security, we need to think beyond potential intentional malicious attack but also unintentional negligence and unplanned events.

What if my network slice gets compromised? What if another slice gets compromised? What if another slice is eating up resources?

We outline these three key questions that enterprises have around their security concerns, as potential tenants of network slices, in the body of the report.

Table of contents

  • Executive summary
  • Introduction
    • Network slicing is central to unlocking the 5G opportunity
    • Dynamic, virtualised, end-to-end networks on shared resource
    • Slicing might come about in different ways
    • Slicing should bring great benefits…
  • Enterprise security concerns with network slicing are rooted in the fear of the new and unknown
    • What if my network slice gets compromised?
    • What if another network slice is compromised?
    • What if another network slice is eating up resources?
  • Security concerns will slow adoption if not addressed early and transparently
    • Concerns and misconceptions can be addressed through better awareness and understanding
    • As a result, enterprises project concerns about public networks’ limitations onto slicing
    • The way that network slicing is designed actually enhances security, and there are additional measures available on top.
  • Telcos must act early and work more closely with customers to drive slicing adoption
    • Ensure that the technology works and that it is secure and robust
    • Organise and align internally on what network slicing is and where it fits internally before addressing enterprise customers
    • Engage in an open dialogue with enterprise customers and directly address any concerns via a ‘hand holding’ approach
    • Don’t wait for maturity to start testing and rolling out pilots to support the transition and learning process
  • Conclusion

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Private and vertical cellular networks: Threats and opportunities

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5G is catalysing demand for customisation

The arrival of 5G has catalysed a huge amount of interest in enterprise, government and “vertical” use-cases for cellular networks. Cellular technology is becoming ever more important and applicable for businesses, for diverse use-cases from factory automation, to better hospitality guest-services, to replacement of legacy two-way radios.

Some of this fits in with STL’s view of the Coordination Age, and the shift towards connectivity becoming part of wider, society-level or economy-level applications and solutions. However, in many ways it is more of an evolution of traditional enterprise use of private wireless solutions, but updated with newer and more-performant 5G radios. The future battleground is whether such coordination requires external services (and thus SPs), or whether the capabilities are best-delivered in-house on private networks.

For various reasons of cost, performance, accountability or guaranteed coverage, there is a drive towards greater customisation and control, often beyond that currently deliverable by traditional MNOs.

However, there is significant confusion between three things:

  • Mobile network services and applications sold to, or used by, industrial and enterprise customers
  • Mobile networks optimised, extended or virtualised for industrial and enterprise requirements
  • Mobile networks built exclusively for, or owned by, industrial companies and other enterprises

This report is a joint exercise between STL Partners and affiliate Disruptive Analysis, which has covered this sector in depth for almost 20 years. Its founder Dean Bubley runs workshops on private cellular and neutral-host networks, as well as undertaking private projects and speaking engagements advising operators, vendors, regulators and investors on business models, spectrum policy and market dynamics.

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What is a private mobile network?

This report primarily focuses on the third category – private mobile networks – although there is some overlap with the second, especially when techniques like network-slicing enter the discussion. There are different models of “private” too – from completely standalone networks that are entirely isolated from public mobile networks, to ones which use some dedicated infrastructure / management, alongside shared radio- or core-network elements provided by an MNO. They can be nationwide networks (for example, for utility grids), or highly localised, such as to a factory or hotel.

There are also various hybrids and nuances of all of this, such as private networks where certain functions are installed by, outsourced to, or managed by, telcos. It may be possible for users or devices to roam between private and public networks, for instance when a truck leaves a logistics facility with a local private network, and switches to the telco while it’s on the road.

Various government bodies – ranging from police forces to local council authorities – are also interested in creating private or shared 4G / 5G networks. Over the next 3-4 years, we can expect a wide diversity of approaches, and some very vague and fluid definitions from the industry.

Three building blocks for private networks

There are three main enablers (and numerous secondary drivers) behind the private network concept:

  • Availability of spectrum
  • Small cells and distributed radios
  • The move from 4G to 5G

A critical element in this is access to suitable spectrum for creating private networks. In recent years, many governments and regulatory authorities have started to make localised mobile licences available, suitable for covering enterprise sites, or wider areas such as cities. While private Wi-Fi and other networks have long been created with (free) unlicensed spectrum, this does not give the protections against contention and interference that more formal licensing enables. Other localised spectrum licenses have been given for point-to-point fixed links, temporary outside broadcast & events, or other purposes – but not cellular networks for normal mobile users. There are also discussions ongoing about making more national or wide-area spectrum available, suitable for mobile use in certain specialised verticals such as utilities.

Small cells and other types of enterprise-grade radio network (RAN) equipment are critical building- blocks for private mobile infrastructure, particularly indoors or on small/medium campus sites. They need to be low-cost, easy to install and operate, and ideally integrated with other IT and networking systems. While small cells have been around for 20 years or more, they have often been hard to deploy and manage. We are also seeing further innovation around distributed/cloud RAN which further increases the options for campus and in-building coverage systems.

5G – or more accurately the 5G era – changes the game in a number of ways. Firstly, IoT use-cases are becoming far more important, especially as analogue equipment and business processes become more connected and intelligent. Secondly, 5G brings new technical challenges, especially around the use of higher-frequency spectrum that struggles to go through walls – which highlights the paradox of telcos providing public network services on private property. Finally, with the advent of cloud-based and virtualised functions such as core networks, it is becoming easier to deploy and operate smaller infrastructures.

Some of the specialised skills requirements for building/running cellular networks can be reduced with automation, although this is still a significant obstacle for enterprises. This will drive significant demand for new tiers and types of managed services provider for private cellular – some of which will be satisfied by telcos, but which will also targeted by many others from towerco’s to systems integrators to cloud/Internet players.

It is worth stressing that this concept is not new. Private cellular networks have existed in small niches for 10-20 years. Railways have a dedicated version of 2G called GSM-R. Military squads and disaster- response teams can carry small localised base stations and controllers in their vehicles or even backpacks. Remote mines or oil-exploration sites have private wireless networks of various types. The author of this report first saw cellular small-cells in 2000, and worked on projects around enterprise adoption of private 2G as early as 2005.

Private and vertical cellular networks: Threats and opportunities aims to clarify the concept of “private” networks. It explores the domain of business-focused cellular networks, where the enterprise has some degree of ownership or control over the infrastructure – and, sometimes, the radio network itself. The report then sets out the motivations and use cases for private networks, as well as the challenges and obstacles faced.

This report is a joint exercise between STL Partners and affiliate Disruptive Analysis, which has covered this sector in depth for almost 20 years. Its founder Dean Bubley runs workshops on private cellular and neutral-host networks, as well as undertaking private projects and speaking engagements advising operators, vendors, regulators and investors on business models, spectrum policy and market dynamics. Please see deanbubley.com or @disruptivedean on Twitter for details and inquiries.

Table of contents

  • Executive Summary
  • Introduction
    • Public vs. non-public networks
    • Private network vs. private MVNO vs. slices
  • Motivations & use-cases for private networks
    • Business drivers for private cellular
    • Technical use-cases for private cellular
    • Industrial sites & IIoT
    • Enterprise/public in-building coverage
    • Neutral host networks (NHN)
    • Fixed 4G / 5G networks
  • Regulatory & spectrum issues
    • Other regulatory considerations
  • Building private networks – technology
    • Architectural choices, technology standards & industry bodies
  • The emerging private networks value chain
  • Conclusions & Recommendations
    • How large is the private network opportunity?
    • Challenges and obstacles for private networks
    • What is the implication for traditional telcos and MNOs?
    • Telcos’ relationship to project scope

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5G: ‘Just another G’ – yet a catalyst of change

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5G: Cutting through the hype

This briefing document is being published in June 2018. This report does not re-hash the familiar background story to 5G – the original specifications, the much-ballyhooed early thoughts on use cases, nor the breathless rhetoric about how it is going to change the world (or in the risible words of one hyperbolic tech CEO, “be more important than electricity”). Neither is it a hatchet job decrying the whole exercise as worthless. Instead, it looks at the factors acting as brakes and accelerants for 5G, and how they may affect the overall ecosystem’s evolution.

What is needed, however, is a way to cut through the spin – especially where it is aimed at policymakers and investors, who often latch on to simple but unrealistic stories. Some of the most absurd ‘5G-wash’ hyperbole emanates from Brussels and Washington DC, and in the run up to the next World Radio Congress in 2019 (where spectrum allocations are debated) it is critical that rationality and critical thought prevails over glossy lobbying. It is harmful to us all if 5G hype means it ends up overshadowing worthy parallel developments in satellite communications, private wireless and other technologies that also deserve attention, spectrum or subsidised research projects.

It is understandable that many in the industry ‘talk up their own book’, especially given consolidation and profitability concerns in the vendor space. The 2018 market for telecoms infrastructure is expected to decline, and there are huge hopes at Ericsson, Nokia and Huawei that 5G can help turn it around in 2019–20. But that is not an adequate excuse to exaggerate. Neither is it an excuse to mislabel and market diverse other technologies (advanced versions of 4G, Wi-Fi and so on) as ‘5G’ – although such egregious duplicity is one of the few certainties here. It is probably enhancements and capacity additions for 4G that will prove the biggest moneyspinners over the next 12–24 months.

The next 24 months for 5G

In theory, the next 24 months should be when it all happens for 5G. Early demonstrations and trials have been well publicised, including various global cities’ testbeds and the South Korean Winter Olympics in Pyeongchang. Almost every week yields new press releases, lauding everything from medical diagnosis (NTT DoCoMo) to self-driving snowploughs (Telenor). It is unclear how much any of these shiny announcements actually accelerate real, commercial deployments – or real business models.

This period is also a critical juncture for standards, starting with the formalisation of the first phase of standards at the June 3GPP meeting (Release 15), leading up to the full ratification of 5G as the official IMT2020 technology by the International Telecoms Union (ITU ) in 2020.

Much of the technology media is trying to pitch the development and deployment of 5G as a race, either between countries or individual operators. The first fixed-wireless deployments are under way, while the earliest mobile devices are expected by the year end (probably portable 5G/Wi-Fi hotspot modems). 2019 should see a flurry of early launches and the first 5G-capable smartphones becoming available.

Yet those forms of 5G broadband – fixed or ‘enhanced mobile’ – are hardly novelties, despite the gigabit speeds and low latencies promised. In many ways, they risk being overshadowed by continued evolution of 4G networks, which is occurring in parallel.

There are also plenty of IoT-type demonstrations, whether for delivery drones, autonomous vehicles or automated industrial machinery. Yet these seem much less real for now – the value-chains are far from clear, and often they will need networks to be built in new locations, rather than reusing existing towers and backhaul. It also isn’t obvious that large enterprises are willing to pay much for such connectivity, and whether they’ll be happy with ‘slices’ of MNO-controlled networks or if they want to own them outright.

There remain many hard-to-answer questions about 5G’s emergence:

  • Will global consumers switch to 5G phones en masse in 2021–22 or more from 2023–24?
  • Will today’s mobile operators consolidate further or will there be an explosion of new niche providers targetting verticals or specific uses?
  • Is there a ‘race’ between countries to deploy 5G, and if so, why? Do arguments about 5G ‘leadership’ really translate to economic benefit and jobs, and if so, for whom?
  • Will the US, Japan, South Korea and maybe China take a significant lead on 5G, or is it more about geopolitical grandstanding in the Trump/Xi age, and helping national-champion vendors and operators gain a reputational boost?
  • Will 5G, NFV, SDN and edge computing work in true synergy, or will delays or limitations in one area have knock-on impacts on the others?
  • What are the unexpected practical ‘gotchas’ for 5G that might add friction, cost or delay to deployment, or complexity to operations? Is fibre availability for backhaul a critical prerequisite?
  • Does 5G pose an opportunity for new niche suppliers of technology – for example in small cells – or will thinning margins and price pressure from operators and open source force many aspirant vendors out of the market?
  • Will ‘verticals’ and IoT really matter for 5G, and if so will telcos view enterprises more as customers, partners or even suppliers and competitors? Which industries are realistic opportunities for 5G’s new capabilities for low latency or ‘massive IoT’?
  • Who, if anyone, will make a profit from 5G-enabled networks, devices, services and embedded capabilities?

The truth is that many of these questions cannot be definitively answered today, despite the emphatic nature of a lot of industry comment. Here, we present some scenarios and especially look at the idea of pre-requisites: what needs to be done first, for 5G to be successfully deployed or monetised? There are potential bottlenecks ahead, as well as opportunities.

Hopefully, we have plotted the roadmap, even if the industry cannot ‘drive autonomously’ yet.

The rest of this report is structured into the following sections:

  • 5G positive signals – standards, trials and enthusiasm
  • 5G cautions – prerequisites, questions and complexities
  • Verticals – huge opportunity or more market fragmentation and competition?
  • Timelines and practicalities

Think of this report as a weather forecast. 5G will be much like the UK climate: patchy clouds, with rays of sunshine and the occasional storm. The summer will be late but warm, but you’d best pack a 4G or Wi-Fi umbrella just in case.

And just as with weather, trying to do long-range forecasts is very risky. There’s a good chance that circumstances will prove you wrong. But despite that, we have some qualitative predictions stretching out to 2026, at which point we expect to be bombarded with 6G hype, alongside 5G reality.

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5G positive indicators: reasons to be happy!

In many ways, the development of 5G is going remarkably well, especially compared to some of the partisan inter- and intra-technology standards warfare of the past.

In the recent past we have seen:

  • Approval by 3GPP of the first New Radio (NR) specifications in December 2017, for Non- Standalone mode, which means that 5G NR can be deployed using the existing 4G core networks.
  • Early engagement by the cellular industry with various industries’ representatives, notably automotive, manufacturing and healthcare. A number of joint bodies have been set up, with the objective of defining ‘vertical’ and especially IoT-centric requirements and testbeds.
  • A timeline for silicon and device availability that aligns much better with that for networks than was the case with 3G or 4G.
  • A whole range of cool demonstrations in Pyeongchang at the South Korean Winter Olympics in early 2018.
  • Research labs for 5G set up around the world.
  • High awareness of 5G among governments, businesses and media, even if it is often over-hyped,as that is hardly unusual for new technologies.
  • An ongoing procession of spectrum auctions for frequencies suitable for 5G, and ready availability of test licences.
  • Good (albeit uneven) progress in adjacent mobile areas such as NFV, SDN, edge computing, cloud RAN, network slicing, automation of processes, AI and so forth.
  • Continued growth of 4G usage, and likelihood of capacity constraints driving the need for future upgrades.
  • Commendable work by both large and small vendors in creating early equipment, and approaching target speeds and latencies more closely than many observers (including the author) thought were probable.
  • Some good early results from trials, especially of high-frequency mmWave networks, which show decent propagation properties and even indoor penetration – albeit through glass, not solid walls – exceeding the (admittedly low) expectations. For instance, AT&T has tested for weather resistance of its mmWave 5G trials – important as some have expected rain or snow to have an impact on propagation.
  • The effectiveness of MIMO (multiple-in, multiple-out) antennas appears to negate some of the poor notional radio properties of midband spectrum in the 3–4GHz range as well. Essentially beam-forming and beam-steering allows radio ‘spikes’ to concentrate power towards actual users’ positions (including indoors), rather than radiating uniformly and thus wastefully.
  • No major fights (yet) over IPR and costly patent licences.
  • Encouraging forecasts from some analysts (not published by us, so we won’t quote them) and trade associations about 5G subscriptions and related services.

Early trial results and 5G deployment plans

While many operators and international laboratories and organisations are testing 5G, a few of the experiments stand out.

Probably the most high profile have been the various South Korean initiatives that took place during the Pyeongchang Winter Olympics, and Verizon’s work on fixed-wireless access in the US. KT and SKT showed various approaches to 5G-connected cars, novel camera footage from 5G-connected drones, real-world usage of mmWave radios and numerous other showcases. Korea is expecting to see launches of commercial 5G services around March 2019.

Verizon announced at the end of 2017 that it was aiming to light up a handful of cities – Sacramento, California most notably – by the end of this year. More details have become clearer recently: initially it will launch fixed 5G for mostly residential users, with mobile variants following around six months afterwards. Samsung has had its 28GHz-band routers approved for both indoor and outdoor use in the US, and these are expected to feature in Verizon’s early offerings. (STL Partners is writing a separate briefing report digging more deeply into Verizon’s 5G strategy, which includes an estimate of its huge investment into fibre for back/fronthaul).

(Mobile launches usually lag fixed-wireless services, as they need more coverage, more testing and a lot more complexity around cell-to-cell handoffs. And within mobile uses, it is usually easier to provide simple devices such as modems or cellular/Wi-Fi hotspots, as phones and voice access require even more work.)

AT&T is being aggressive with its ‘proper’ 5G rollout, as well as its controversial “fake” branding of advanced 4G as ‘5G Evolution’. It is intending to launch standards-based 5G, capable of supporting mobile devices (initially mobile Wi-Fi hotspot ‘pucks’) in at least 12 cities by the end of 2018.

AT&T started demonstrating and testing pre-5G technology in late 2016, including an enterprise trial in mmWave bands, together with Intel. In June 2017, it extended the trials to residential users in Austin, Texas, doing video streaming over fixed-wireless access. This was followed by a small-business fixed- wireless trial in Waco, Texas, which generated good results including 1.2Gbps throughput speeds and 9–12 millisecond latencies. That said, it seems less enthusiastic than Verizon about the general fixed- wireless opportunity1, especially given the backhaul fibre investment needed.

Telco operators that are well advanced on 5G plans include:

  • Japanese operators: NTT DoCoMo, KDDI and SoftBank have all been running multiple trials, for a wide variety of use cases and deployment scenarios. All are expected to have networks up and running in time for the 2020 Summer Olympics. NTT in particular has been very visible, signing contracts with vendors including Nokia and NEC.
  • Chinese operators: Spurred on by its government and Huawei as national champion vendor, all three telcos are deploying significant test networks, in a total of 16 cities across the country. Importantly, the regulator has shown commitment to issuing 5G spectrum in large tranches, and also seems to be encouraging infrastructure both between the operators and also China’s electricity grid operator. Chinese operators have also been quite aggressive on other key technical enablers such as AI/automation and network slicing.
  • Sprint and T-Mobile US: Both operators had previously been talking up 5G, but this has taken on a new perspective since the announcement of their potential merger. T-Mobile’s plan to use 600MHz spectrum for 5G is fairly unique and points to a possible nationwide network much earlier than its peers. Sprint’s hoard of 2.5GHz frequency is also extensive and could be a key differentiator given that the US has been slower to release 3.5–4.5GHz ‘midband’ spectrum than other markets. If their merger goes ahead (possibly a big if, given previous regulatory reluctance) the new T-Mobile may try to do for 5G what Verizon did for 4G – use it as a competitive differentiator to gain market share. It may face challenges getting devices supporting its unique 600MHz band, though – a similar problem that plagued it with the early days of 4G.
  • Deutsche Telekom: Aligning with its US arm, the domestic German arm of DTAG is perhaps the most vocal early enthusiast for 5G in Europe, deploying a growing test network in Berlin in particular. It is also getting its backhaul house in order, deploying tens of thousands more fibre kilometres annually.
  • Telstra: In Australia, local operator Telstra has launched a number of trials, including 5G for fixed-access backhaul to some publicly available Wi-Fi hotspots on the Gold Coast.
  • Spark: In New Zealand, local operator Spark has signalled an intent to deploy 5G (probably for fixed wireless) as early as possible, if it can get spectrum.
  • MTN: One of the few notable developing market 5G trials is that by MTN in South Africa, with Huawei.
  • India: The Indian government has signalled that it expects to announce its overall 5G strategy in June 2018. Although some are talking of 2020, it seems unlikely to gain a broad deployment fast, given economic limitations, especially driven by the 4G rollout and subsequent price war and consolidation between operators.

There are some notable absentees from this list. The UK has various government and MNO-sponsored trials, but little commitment by the telcos to move towards commercial launches yet. The Scandinavian operators, early on 3G and 4G, also seem more diffident this time. So too are the smaller countries in developed Asia; Singapore and Taiwan are also (comparatively) lagging the timelines that might be expected, again reflecting caution over business case.

In the Middle East, Ooredoo, Etisalat and STC have all been keen to be early to market with demo networks, but it’s unclear whether that will translate to broader, rapid deployments.

5G Spectrum

As always with new mobile networks, one of the input requirements is suitable radio spectrum. Generally, 5G seems to be doing fairly well in this regard. Many countries have started initial awards or have them planned for the next year or so.

Various European countries are releasing 3.5GHz ‘mid-band’ spectrum, while the US has earmarked both 600MHz (which T-Mobile has large amounts of) and 28GHz as priorities. Japan’s early focus is on 4.5GHz. In addition, there is a strategy by many operators to progressively switch off old 2G and 3G networks, and ‘refarm’ the bands for 5G.

The general expectation is that 5G will require a combination of three broad sets of frequencies:

  • Low-band, mostly below 2GHz, for wide-area coverage and good indoor penetration
  • Mid-band between 3GHz and 6GHz, for densified, mostly urban networks, probably with complex MIMO antennas
  • High-band above 6GHz, and probably mostly from 20–40GHz, although some are speaking of 90GHz or even higher for local usage.

Notably, many markets are not waiting for the official seal of approval from ITU and its World Radio Congress at the end of 2019, which was supposed to define the first set of ‘harmonised’ 5G frequencies (more accurately, IMT2020). A second set is expected, based on ITU’s ridiculously leisurely process, to be ratified only in 2023. Instead of this timeline, many regulators are either pre- guessing the outcomes (fairly uncontroversial for the 3.5GHz band) or just ignoring them (such as 28GHz in the US and South Korea). We wrote about 5G spectrum in early 2017, discussing this in more depth.

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5G is becoming real

In other words, 5G is becoming ‘real’, it’s getting a lot of interest and investment, and the basic technology enablers seem to work, at least in the lab and limited field trials. There are plenty of suggested use cases, and even if some of them prove far away or unrealistic, there should be some that make it through the funnel, plus others that are unanticipated.

That said, there is a cliché that states that any parts of a sentence or speech before the ‘but’ should probably be ignored.

Contents of the 5G report

  • Executive Summary
  • Introduction
  • 5G positive indicators: reasons to be happy!
  • Early trial results and deployment plans
  • Spectrum
  • Summary – the good news!
  • But what are the obstacles to 5G?
  • Densification and network sharing
  • In-building coverage
  • A lack of 5G business models
  • 5G-specific models in a hybrid-network world?
  • Devices and silicon
  • Other issues and concerns
  • Verticals: customers, partners or competitors?
  • Overview
  • Operator networks for verticals? Or private 5G?
  • Thoughts on specific verticals
  • Vendor attitudes to verticals and private networks
  • Timelines and practicalities
  • 5G in name only?
  • Conclusions

Figures:

  • Figure 1: 5G predicted timeline, 2018–2026
  • Figure 2: Who are the 5G bulls and bears?
  • Figure 3: 5G antennas may be larger and heavier than 4G equipment
  • Figure 4:  Multiple dimensions for future wireless networks’ use cases and requirements
  • Figure 5:  Creating private 5G networks involves significant complexity for enterprises
  • Figure 6: Predicted 5G relevance to verticals, 2023-25 timeframe
  • Figure 7:  Numerous applications of machine learning and AI for 5G networks
  • Figure 8: Overall 5G predicted timeline, 2018–26

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