The Fifth Generation: #1

Your regular IDC Australia and New Zealand update on all things 5G

5G is at peak hype which means my Feedly app is bulging at the seams with mobile network news. So instead of writing long analytical reports on 5G, we'll do short snappy updates, so you can keep up to date and appear knowledgeable in technology meetings. These updates are based from mostly secondary research, general industry and analyst relations conversations. If you are looking for primary research reports with a full focus on the New Zealand market then get in touch with me.

Big News This Week: The Finnish Have Started but Haven't Finished

Mobile network operators (MNOs) in various countries have put dibs on the "first network ever!" claim this week. Ooredoo in Qatar claims Qatar as the first country in the world to roll out a 3.5GHz 5G network. In Finland, MNO Elisa said it has launched the world's first commercial 5G network. Back in May, UAE's Etisalat announced it has 'pre-commercially launched' in parts of the country with fixed wireless internet services available to consumers from September this year. 

So what's the real deal? Telcos saying that they have launched a network is a different statement to saying that they have completed deployment. Two live cell sites and a webpage could probably be called a commercial launch. I don't want to downplay the efforts telco teams are making to launch networks but the reality is that end point devices aren't on the commercial market yet, so 5G subscribers probably can't actually do anything on the network. Elisa says it has 5G subscribers; the company has deployed Mi-Fi routers that act as a mobile data hotspot meaning customers with a 4G device can use the hotspot (powered by 5G connectivity).

Should We Go Fast or Slow?

In the USA, mobile network operators are keen as beans to launch 5G while other countries, like New Zealand are more laid back. Why? The answer lies in the value of Fixed Wireless Home Broadband. Fixed wireless provides a household or premises with a broadband connection using the cellular network, instead of a fixed network such as copper or fibre. In New Zealand, Spark has signed up over 100,000 customers to its 4G fixed wireless service. 5G speeds could compete with fibre and Spark say 5G could mean fast fixed wireless home internet with uncapped data. New Zealand is well serviced with fibre-to-the-home and dozens of retailers selling products around the country. The success of a 5G fixed wireless proposition in New Zealand is debatable.

In the US, mobile operators such as AT&T, Verizon and T-mobile are champing at the bit to launch 5G. Data from the FCC shows that nearly 50 million US households have either only one internet provider or no providers that can provide a 25Mbps+ connection. If 5G can provide a viable home broadband alternative to 50 million households then that is a rather large addressable market for the mobile network operators. Hence the rush to get in quick and get in first to snap up customers before further 5G competitors arrive.

In Australia Optus will launch 5G fixed wireless home broadband in January 2019 as an alternative to the National Broadband Network (NBN). The company will focus on "key metro areas" within capital cities. 

This Week's 5G Device News

This week a company we've never heard of in New Zealand called OnePlus might be the first out with a 5G capable phone according to tech news site phonearena.com. However the notion it might be first is only based on some supposed "strong ties" with chipmaker Qualcomm. Chinese firm OnePlus says it is working with USA carriers on its 5G phone. Industry commentators wonder if the very next phone iteration of the phone due this year might be the first 5G capable version.

Late last week Huawei announced it intends to launch a 5G capable smartphone in the middle of 2019. It has already developed a 5G ready modem. Don't expect every man and his dog upgrade to a 5G phone though. IDC Device Analyst Alex Yuen says that we can expect the Kiwi smartphone replacement cycle to continue lengthening, from 3 years as now to perhaps 3.5, 4 years or even longer.

The Exciting World of Spectrum (and law and regulation)

We'll keep this section short and bullet-pointy:

• Canada has announced it will auction off several spectrum bands for 5G with the first auctions happening in March 2019 going through to 2021 for the last auction. The country has also noted that cell tower regulation will need revision to take into account the additional cell sites in the form of small cells that we can expect mobile network operators to pepper around city areas.
• Hawaii has signed legislation that will standardise small cell deployments (way ahead of you Canada). The bill establishes a process for MNOs to co-locate small cells on state and county owned poles as the state believes that investments in wireless broadband will drive growth in the economy. 
• In New Zealand, Radio Spectrum Management (RSM) consulting with stakeholders with no date yet announced for spectrum auctions. In Australia, Spectrum auctions of around 125MHz in the 3.5GHz band will occur in October.

Tune in next time for the next exciting episode of The Fifth Generation.

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