Let’s put discussions about the failure of 5G to launch to rest, finally

It has been a while since I have posted any analyst columns. Mainly because AGL Information & Technology, the successor to Above Ground Level (AGL), is taking longer to launch than anticipated. But since 5G has now had a few years to mature, I think the time has come for another missive about why 5G just cannot seem to gain real traction.

I am usually the last person to say, “I told ya so.” While it’s generally considered more mature and humbler to refrain from saying that there are certainly moments when it feels warranted to acknowledge that one’s insights are correct. For me, since I have been doing this for nearly three decades, if I can’t get it right by now, I need to hang up my keyboard.

I just read another in a long line of columns from various media outlets that pointed out the failure of the telecoms industry is to monetize 5G (again). This was one of countless similar pieces I have seen over the past couple of years.

Generally, each piece has a slightly different assessment of why, but if they come from knowledgeable sources (not PC Rag), they all give similar reasons. And frankly, I am a bit surprised that there is still discussion about this.

Some of us saw this coming

The failure of 5G to launch the way it was hyped was as predictable as the tides. As far back as the initial noise of 5G was being heard (I’m going to call it 2015 with 2017 actually making it live, when it was first talked about and next, when carriers started trialing fixed wireless 5G services as a replacement for wired broadband homes).

It wasn’t until 2019 that 5G started to get noticed. At about the same time, I started writing and speaking about it. I took the position that speed and all the other slick advancements would mean nothing to the end user without a real uptick in applications to ride on it.

I recall having many conversations and sitting on panels at conferences about this. Every time I broached the subject of monetization with industry pundits, most came back to me with the end user would be wowed by its speed and performance and that would make it irresistible. And it is not like I am a Mensa member or the only one taking this viewpoint. There were a few other brave souls willing to go there as well. But we were few and far in between.

Here comes the tsunami

As the decade ticked up to the 2020s, the hype momentum was like a storm surge. Get on the wave or get run over. That the world was going to be in awe of 5G technology-speed, bandwidth, latency, etc. Well, here we are five years later and 5G is a flop.

I can’t really blame the players, though. That was the way it had gone, with 3G and 4G. But both 3G and 4G had something of offer other than technology. 3G added better data metrics, video calling, and mobile internet-features. 4G added gaming services, HD mobile TV, video conferencing, 3D TV, and other high-bandwidth features because it did bump up speed and bandwidth. These services made sense to the end user because they offered something new, not because it was faster. The end user never has, and never will care about raw speed or bandwidth, whatever you want to call it.

3G and 4G had verticals that the end user could lay their hands on. And that makes it monetizable.

There was also one other variable that made 3G and 4G successful. That was the evolution of mobile communications itself. Everyone wanted a mobile phone. And the costs were coming into the range of the average consumer (especially with all the discount programs offered by the carriers). So, when early pseudo 5G came out, its performance did not really improve much over 4G. And there was plenty of publicity about that.

Now, as 5G matures, it’s starting to live up to some of its claims. However, it still did not add anything nearly as valuable as did 3G and 4G. And it was still suffering from the image of early performance anxiety. So, users still did not find any value in just “speed.”

Therefore, when early “5G” debuted, and nobody came, they were dumbfounded (BTW, “they” are basically the carriers and service providers). So, the old adage, “build it and they will come,” didn’t happen.

As the years have gone by, the 5G bullet train became a slug. There were a lot of backroom meetings on how the heck to get 5G traction. But no matter how they spun it, it needed apps. And we are still looking for that illusive “killer” app that everybody was waiting for. In fact, we are also still waiting for the marked improvements in existing apps that the end user could see, and find enough value to shell out the dollars. On top of that, it has only been very recently that we have begun to deploy real 5G (5G SA).

After the hype

I don’t believe much of the industry understood what the early hype would end up doing to the platform since 3G and 4G were so successful. With the horse out of the barn, the infrastructure guys bit the bullet and started funding the deployment, whatever the cost was, hoping to recapture the costs once it was deployed. Then they had to figure out apps and verticals that the end user would see as worth paying for (never mind that most wireless providers still have no real clue as to how to monetize it once they deploy it). And real 5G SA has only been deployed in a limited number of places in the last year or so.

In the wake of this disaster, some of the damage control was to rush out a few new apps and improve some existing ones (video download was a big one). But they were slapped together using tape and glue. And without 5G SA, they simply continued to run on hybrid systems that piggybacks off 4G LTE.

Trying to salvage some dignity, certain players started to slap labels on the hybrid systems. 5.5G (or 5G advanced, or 5GE) were the main attempts. However, under the covers, it is still 4G. And there was quite a bit of grandiloquence over early 5G claims. On top of that, advanced iterations of 4G were still doing the job. (a story for another time).

The next chapter

OK, I think we get the picture. It’s 2024 and 5G is still struggling. Some progress has been made, especially in Asian markets with SA, but killer apps and half-way ubiquitous deployment are still lacking.

However, there is promise in some verticals. Top among them is gaming and virtual everything, aka metaverse, (which, BTW is also sputtering). Other potential markets include fleet management, healthcare, manufacturing (looking hard at private 5G), fixed wireless (FWA) as competition against fiber to the premise, and real-time multimedia streaming. Each is in a various stage of gaining traction, some further along than others. There are, of course, a slew of other verticals waiting in the wings or targeting narrower markets.

Do we have 5G? Unequivocally, yes. But not in the way it was hyped at its inception. The dust has settled. Everyone gets it that the only way 5G is going to monetize is with verticals. And that won’t happen until it is adequately deployed.

What is it going to take?

Foremost, get the network out, whatever it takes. That “whatever” is the same old notion as everything else-time and money. Most countries have come to the realization that they need to throw government money at it to kick start it.

Many countries are subsidizing 5G deployments. Countries in Europe and the Middle East, Japan, and South Korea are the most visible, but the list keeps getting longer. The U.S. tends to take the view that 5G deployment should be done by the carriers and infrastructure segments and not the government. I agree, but at the same time, there is the specter that without government funding, we will fall behind in both deployment and technology.

However, the U.S. is throwing something at it. Help is coming in the way of the Wireless Innovation Fund and the Rural 5G Fund. It’s not much, but better than nothing. As well, the government is moving along with reworking the spectrum, so there is more available and deployment is easier.

And, of course, let’s not forget our split with China. It would have been so much nicer and easier if both east and west were on the same page and developed 5G as partners. However, as it stands now, 5G will deploy as a fragmented global ecosystem. How globally seamless it will be is yet to be determined.

So, with all this being said, the deployment of 5G is going to take as long as it is going to take, especially with all the shifting global ecosystem. Continuing to discuss the failure of 5G becomes moot.

The future of 5G is no longer hiding in a crystal ball. The solution is simply to get the network deployed with SA and start building apps that the end user finds attractive.