5G Market update: all you need to know

4 months ago, I analyzed the status of 5G in terms of market launch, technology development, and ecosystem. I thought it would be insightful to look at how the situation has changed after 120 days of my last post. 

Market trends: Exponential data growth keeps accelerating 5G deployments

By the end of 2019, Global mobile data traffic is expected to reach 38 per month and is projected to grow 4 times to reach 160 per month in 2025. This massive data growth will be fueled by the mobile data consumed by over 6 billion people using smartphones, laptops and a huge number of devices 6 years from now.

From a consumer perspective, this means that in most developed markets, mobile data users will move from consuming an average of 10GB per month of mobile internet today to more than 40GB per month by 2025. 

The mobile industry will need to rapidly deploy 5G technology in a broad range of frequency bands to meet this demand in a more cost-effective way. The marginal cost of production for mobile data needs to be dramatically reduced from 0.30usd/GB to below 0.1Usd/GB to manage the data growth

Market launches: 50 commercial networks globally

As of today, 328 service providers in 109 countries had announced plans to invest in 5G. A total of 50 operators had launched 5G services including Australia, China, Estonia, Finland, United States, Spain among others. This is double the number of launches since August this year. 

5G Home broadband is also gaining momentum with more than 29 operators who had launched 3GPP-compliant 5G Fixed wireless access services.

In terms of uptake, South Korea is still leading the way. The country has secured more than 4 million subscribers onto its 5G networks as of October 2019, which was a rise of over 500,000 subscribers from the previous month. SK Telecom has the most 5G subscribers with 1.77 million, followed by KT's 1.21 million and LG Uplus' 1 million. Global subscriptions will be reaching 15-20 million subscribers by the end of 2019. 

By 2025, global 5G connections are expected to reach 1.6 billion (equivalent to an adoption rate of 18%), driven largely by high rates of adoption in China, Europe and the US. Analysts expect China to be the biggest market with roughly 600 million connections, accounting for 38% of the world.  

Devices: more than 40 5G commercially available

There are 183 5G devices from 72 vendors tracked in the GSA database, at least 42 are commercially available.

During 2019, the number of 5G devices grew rapidly, starting with a few announcements and then gathering pace as operators in various parts of the world launched their first commercial 5G services.

The 5G device ecosystem is growing beyond smartphones. During this year, fifteen different 5G form factors were phones, head-mounted display indoor CPE, outdoor CPE, laptops, modules, dongles, enterprise routers, IoT routers, drones, robots, TVs, switches USB terminal and a vending machine.

Annual shipments of 5G devices are projected to reach 13 million units by the end of 2019. This number of shipments may sound small compared to the 1.4 billion smartphones shipped during 2019, but it is much faster than 4G's initial period.

2020 will start showing bigger volumes reaching around 160 million units, with China expected to increase 5G coverage. Also, all major vendors will have released a 5G-capable device and several vendors are expected mid-tier smartphone segments.

Another important aspect of the device ecosystem is 5G standard and spectrum support. The industry ecosystem is focusing at this point on developing device supporting the most used spectrum frequencies to drive volumes.

According to GSA, 70% of the devices commercially launched are supporting 3.5 (n77, 78, 79) and 2.6 (n41). This is a relevant piece of information as Telco should as much as possible follow the most adopted frequencies to enjoy economies of scale and access to cheaper devices.

5G Modems Chipsets

Since our last report, there has been further activity in the 5G chipset arena. Hi-Silicon (Huawei) has launched its first-generation 5G-only 5G01 cellular modem and, more recently, its second-generation LTE/5G 5000 cellular modems. A 5G version of its Kirin processor, the Kirin 990, has also been launched.

Mediaset launched Helio M70 modem and in May 2019 a multi-mode 5G system-on-chip (incorporating the M70 modem). Devices containing the chipset are expected to come to the market in 2020.

Qualcomm has launched the Snapdragon 855 and 855+ mobile platforms and the Snapdragon X50 modem. Its x55 modem is coming soon. It also announced its 8cx 5G platform for laptops And recently confirmed that 5G chips will become available in its Snapdragon 6 and 7 series devices next year.

Samsung has launched its Exynos 5100 (S5T5100) modem and recently announced the Exynos 980 mobile processor and complementary Exynos 5123 Mass production is expected by the end of 2019.

U-Blox has announced a 5G- chipset. Its UBX-R5 IoT chipset will be ultimately capable of supporting 5G, but it will need an OTA software upgrade to do this.

Spectrum

C-Band Spectrum (3.3-4.2Ghz) has been licensed to 64 operators for 5G in 32 countries. C-Band spectrum will provide the most cost-effective spectrum for nationwide 5G deployments. In a way, it could be considered similar to 1800Mhz in LTE: a good balance between coverage range and throughput for enhanced mobile broadband users (e.g 1800Mhz in LTE).

Mid-band (3.4 to 4.2) remains a challenge for many countries where C-Band is currently used by services. Although there are few good examples of how regulators can support the co-existence of 5G and services running on these bands (e.g. Hong Kong), it will be important to explore other alternative bands. 2.6 TDD (n41) seems to be a good candidate for many countries. 

Again, as explained in my last post, 5G requires at least 100Mhz of spectrum assigned for a Telco to fulfill its promise. 5G high speed, better experience, and performance on the ability to cater more spectrum per radio compared to other technologies (e.g. 20Mhz carrier on LTE 100Mhz). Unfortunately, many regulators tend to forget this requirement and divide 5G spectrum in small chunks which will not live up to the expectations of this standard. 

Another recent development has been the industry consensus to explore a new set of spectrum bands above 6Ghz. Beyond smartphones, 5G can support more advanced use virtual and augmented reality applications, remote control of industrial robots, autonomous vehicles, as well as entertainment services, such as downloading 8K movies in seconds. These services will require even more spectrum to bring massive internet download speeds (10-20Gbps).

These services will be possible through the identification of wave frequencies in the 26 GHz, 40 GHz and 66 GHz ranges. During the past WRC-19, there was a strong consensus to identify new spectrum for additional mid- and low-frequency bands.

Pricing, packaging and go to market: 5G as a premium service

There are more than 100 5G plans already launched worldwide. 13 included true unlimited data from three operators: Vodafone UK, Vodafone Germany, and T-Mobile Germany. Vodafone UK introduced speed tiers for 5G to test the market.

So far operators have been positioning 5G as a faster 4G and with little and packaging innovation. This means tiered plans based on data caps and speed levels. The obvious difference is that the speeds and data caps are much higher, but essentially it’s the same offering.

This is expected in this early stage of development, where the only killer app is a bigger internet pipe for existing 5G smartphone users. At this stage, Telcos are trying to assess consumer willingness to pay and which plan works better. One potential concern is that the incremental 5G ARPU may not materialize as several Telcos are moving to unlimited plans, limiting 5G upside. 

In the future, 5G will support more advanced capabilities that will help ultra- latency communications and massive machine-type communications (e.g., augmented reality and the IoT). However, this would require wider 5G coverage and customer conversions, which would take some time.

5G use cases: A lot of good ideas, but very few implementations

5G standard will support very advanced use cases, beyond any other connectivity technology. With download throughput speeds of 1Gbps and, more, 4-5mms latency and the ability to program the network to support deterministic reliability, 5G create a completely new space for applications. 

The industry has categorized 5G into 3 main blocks: (targeting mainly higher area capacity), massive Machine Type Communications (targeting of devices), and Ultra Reliable Low Latency Communications (targeting a wide range of applications)

Despite all the hype and great ideas, the current use case implementation is at a very nascent level. There are many trials ongoing that are trying to explore beyond traditional broadband but there are limited by the early technology stage of 5G. This outlook will improve as move into 5G standalone (5 SA) implementations in the coming years. 

At this stage, it is interesting to explore what cases have emerged during the last few months beyond just mobile broadband.

Cloud gaming: 

Cloud gaming is expected to be one of the most benefited areas by 5G and potentially one of the killer apps for this technology. 5G has the potential to significantly improve the download speeds of games, allowing new platforms such as Google Stadia to reap the benefits. Additionally, 5G opens up possibilities for gaming developers to do more with graphics and interactive design with faster connectivity and for users to carry those massive game files on a device that fits in their pocket.

To achieve this, 5G networks will use Mobile edge computing technologies, allowing them to run applications collocated at the Radio base station site to improve performance and latency. 

KT partnered up with Ubitus, to provide 5G streaming games starting from 100 titles with support of the latest 5G flagships such as Samsung Galaxy Fold, S10, Note 10 and LG V50. KT's 5G Streaming Game service supported by Ubitus can deliver instant console gaming experiences by subscription-based on-demand without the need for users to equip with expensive high-end computers or game consoles as prerequisites. Users will be able to get a taste of streaming games live over 5G and see how it revolutionizes the gaming experience by combining the best with the quality of KT network. 

Robotics:

Verizon has been pioneering the use of Robotics for response leveraging on 5G capabilities. A good example is its joint development with Mass. , a University of Massachusetts research unit. In this case, the plan is the use of 5G networks for a miniature humanoid robot to be remotely controlled in near real-time adjust its gait to stay upright while navigating obstacles. The robot’s “eyes” sent video data to the human operator who was able to respond almost instantly to adjust its step and stride as it climbed and descended a set of stairs. 5G high speeds and low latency enable near “real-time” data transmission the remote control of the robot and fast re-planning of the robot’s movements.

Remote driving:

5G will allow pretty much any type of vehicle to be operated remotely. A good example came out this week SK Telecom and Samsung Heavy Industries test 3.3-meter model ship to be controlled at a remote control center in Daejeon, some 250 kilometers north from the shipyard. The test also verified an autonomous navigation system that enabled the test ship to self-sail to the destination and avoids maritime obstacles via 5G connectivity.

AIR/VR:

Award-winning Australian startup Flaim Systems is already using VR and Haptic technologies to prepare firefighters for real-world conditions. 5G will improve Flaim Systems’ training program by combining VR technology and high-speed networks. This technology will allow an unprecedented ability to train firefighters all around the country.

5G future consumer use cases:

Recently, Ericsson a new consumer research study trying to understand 5G consumer use cases and the willingness to pay users. In the study, Smartphone users predict that most applications and services will go mainstream within 2 to 3 years of 5G's launch and an average 67 percent of all smartphone users were willing to pay for relevant apps and services that they were interested in

5G specifications: More evolution coming soon

The initial 3GPP standards for NR networks capable of running alongside existing LTE networks, using non-standalone (NSA) mode were agreed in December 2017.

3GPP Release 15 Standards for standalone 5G NR mode were decided in June 2018. Further 5G standards evolution is expected in 3GPP Release 16. The scope of work for Release 16 was agreed in 2018 and encompassed several areas for the use of 5G in enterprise use cases such as 5G V2X, 

This week, the 3GPP approved a collection of 24 new projects designed to advance the 5G standard in the second half of 2021. Due to industry demands, the organization is pursuing a faster timeline for Release 17, with plans to conclude this work before the end of 2021.

Release 17 will address a number of third-phase expansions of the standard. Some are on performance, such as improvements to boost speeds and power efficiency, including enhanced dynamic spectrum sharing (DSS), dual 5G and 4G-5G simultaneous connectivity, millimeter wave and delivery of service from multiple transmission points. The standard will also increase location accuracy down to centimeter level and address multi-SIM support for the first time.

Release 17’s will also develop a project called NR-Light. This is a version of 5G that will work on wearable and of things (IoT) devices that need access to faster speed but with a very efficient battery lifetime.

For example, 100Mbps downloads and 50Mbps uploads using just 10-20MHz of bandwidth — small quantities commonly used in low band 5G networks — which will be enough for video cameras, wearables, and industrial IoT sensors. The 3GPP is also working on a parallel project, 5G Massive IoT, to enable existing IoT sensor platforms to support satellite transmissions.

Release 17 is also expected to broaden the use of mobile spectrum in new high bands. Today, most millimeter wave 5G implements have been in the 24GHz to 39GHz range, but the new release will increase supported 5G spectrum the 60GHz band Supporting 5G using the same frequencies could enable future 60GHZ Wi-Fi XR headsets to easily transition between streaming local and network content.

The new release is also expected to add support for public safety multicasting and venue-casting, enabling large numbers of users in specific geographies to simultaneously receive warnings or other notifications. Planners are also working on extending C-V2X to enable — direct vehicle-to-vehicle/device communications — to pedestrians, bicyclists, and users of other small vehicles, both for direct-from-vehicle and communications.

5G performance: Substantial improvements from 4G

As more operators launch 5G services, Opensignal has again analyzed the maximum speed that 5G smartphone users have experienced. The 5G experience is evolving quickly and there is an increase in maximum speeds after of launch.

 USA is experiencing speeds close to 2Gbps and now is joined by Australia, Switzerland and South users also experiencing speeds over 1 Gigabit per second. 

Mid-band 5G is not just the most popular type of spectrum for early 5G launches, it is now rivalling for maximum speed, as well as offering wider geographic reach. However, available spectrum for 5G in the C-band is limited in many countries.