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Mobile Communications July 2018 Viewpoints

Technology Analyst: Michael Gold

A Development Milestone for 5G

Why is this topic significant?

Developers have recently completed an important step toward standardization of 5G technologies. The standards are important for establishing a long-range road map for 5G deployments.

Description

Standards committees within the 3rd Generation Partnership Project (3GPP) experienced a significant turning point during June 2018, achieving consensus on a draft specification for 5G radios that do not depend on any 4G technologies. A previous draft specification that 3GPP approved in late 2017 involved use of new 5G radios with existing 4G core networks.

Since 2017, equipment vendors have collaborated to demonstrate compatible 5G prototypes. Most of the prototypes have been laboratory equipment, not miniature devices, but Samsung demonstrated a prestandard 5G tablet at the Pyeongchang Winter Olympics that reportedly operated at a 3.7 Gbit/s downstream data rate. And during June 2018, Qatar-based service provider Ooredoo exhibited a compact home-gateway device that the company claimed was already seeing limited use in fixed-wireless 5G service. Apparently, ZTE manufactures the gateway.

The same week that 3GPP published the specifications for all-5G radio links, Samsung published a white paper that indicated "initial 5G deployments" are likely to rely on 4G core networks. Earlier in 2018, a technical document from Cisco made a similar statement, and Qualcomm described ways to "fully leverage LTE investments and enable a phased roll-out" of 5G. EDN magazine reviewed statements from more than 50 companies and concluded that none had made firm commitments to deploy equipment that fulfills the new all-5G specification except in "trials...testing, preparation for advanced 5G systems, or some other vaguely worded purpose."

Implications

Engineers who are working on specifications for 5G have until July 2019 to complete their proposals to the International Telecommunication Union (ITU). But some requirements for 5G now have sufficient consensus to give semiconductor and systems suppliers the confidence to invest further in miniaturization and cost-reduction efforts. Critical paths involve long design cycles. Initial end-user devices are likely to be tablets and wireless dongles (pucks) for a user's existing devices, with 5G smartphones arriving later.

Conditions for 5G business developments have some resemblance to those of ten years ago, when stakeholders were demonstrating 4G-LTE prototypes. A decade later, 4G technology is vital to communications, but it is not yet the dominant cellular technology and has still not fully matured. Ten years from now, 5G technologies will likely be similarly situated.

Impacts/Disruptions

Watch for some services that might seek to implement end-to-end 5G networks relatively quickly, perhaps to have a competitive differentiator. Full-fledged implementations promise to fulfill needs for improved network capacity and efficiency, so in the long run, incumbents will have reason to overhaul networks completely. However, the timetable for widespread 5G deployments covers a period of years, not months. Many services that currently run LTE can invest in incremental upgrades (to LTE Advanced and LTE Advanced Pro) before taking an initial leap into 5G. And they can defer upgrading core networks until well after a 5G introduction. Consensus promises to keep road maps free of technology dead ends. But use of incremental technology pathways might cause the term 5G to imply a suite of capabilities that gradually evolves from existing networks rather than a sudden leap in capabilities.

Scale of Impact

  • Low
  • Medium
  • High
The scale of impact for this topic is: High

Time of Impact

  • Now
  • 5 Years
  • 10 Years
  • 15 Years
The time of impact for this topic is: 10 Years

Opportunities in the following industry areas:

Cellular services, telecommunications equipment manufacturing, electronic products manufacturing, discrete electronic components manufacturing

Relevant to the following Explorer Technology Areas:

Software-Defined Business Models

Why is this topic significant?

Efforts to rearchitect mobile-communications networks aim to enable several kinds of new business models. New services can arise from internal efforts, specialized virtual network operators, and other avenues of business development.

Description

New technology concepts related to software-defined networking and related network architectures could enable overhauls of cellular-service business models, affecting internal operations, customer-facing offerings, or both.

  • Internal operations. Service providers will have greatly increased ability to swap out a software module for an improved one, without changing other aspects of a network. Service providers can finance the improvement as a capital expenditure or save on capital investments by outsourcing the function that the module performs. For example, outsourced x-as-a-service resources could include cloud-computing power, network-performance monitoring and analytics, security functions, and baseband functions for radios. Cellular services can even outsource the orchestration of these resources.
  • Customer-facing offerings. Service providers will also have abilities to accelerate creation of new vertical-market offerings, potentially for mobile augmented reality, drones, distributed renewable-energy generators, and so on. Software that has prearranged interface layers for bolting on new services could serve equally well for internal developments and rapid partnership creation. Software and cloud-service companies could develop platforms that fulfill specialized vertical-market needs for multiple cellular services. Enterprises could even design their own custom services.

Engineers describe many technology elements involved in the "softwarization" of telecommunications, including software-defined networking, network function virtualization, network slicing, centralized radio-access networks, and edge computing. All of these technology trends promise to promote constructive business objectives, including enhanced agility, rapid service creation, competitive bidding for service functions, and open innovation.

Implications

Many people in telecommunications see a need to retire traditional telecommunications-industry practices in favor of information-technology practices. Some people describe the change as an adoption of DevOps (developer operations)—a term that emerged as mainstream enterprises saw a need to emulate information-technology leaders' software- and platform-development methods. Adoption of software-defined networking and DevOps could lead to telecommunications industries' having greater resemblance to semiconductor, computer, and cloud-services sectors. Because of natural limits on spectrum and competition, mobile services have often needed highly specialized technologies. Advocates of software-defined networking see such needs as fading rapidly, replaced by new needs for service agility, outsourcing, and rapid adaptation to new styles of end-user devices.

Impacts/Disruptions

Services, partners, and customers face several risks. Many telecommunications services and enterprises need to modernize their software-development practices to harvest value from cloud computing and software virtualization. Clouds and virtual machines can reduce performance on account of network delays and extra layers of software. Centralization of functions can introduce new points of failure. Investments in automation remain costs, whether in the form of capital or operating expenditures. Decisions to increase operating expenses through outsourcing are not always wise in high-volume, low-margin markets. Infrastructure ownership can have advantages.

Vertical-market developments might be disruptive in several ways. Communications-industry players and partners could have rapid ability to spawn just-in-time services as items such as drones and augmented-reality devices become more common. Billing could be separate from an individual or enterprise user's data plan. The rules for packet prioritization might not fulfill a regulatory definition of network neutrality, and the services might not fulfill users' expectations of interoperability.

Scale of Impact

  • Low
  • Medium
  • High
The scale of impact for this topic is: Medium

Time of Impact

  • Now
  • 5 Years
  • 10 Years
  • 15 Years
The time of impact for this topic is: 5 Years to 10 Years

Opportunities in the following industry areas:

Cellular services, cloud services, software development, communications equipment manufacturing, computer manufacturing, appliance manufacturing, vehicle manufacturing, municipalities, first responders

Relevant to the following Explorer Technology Areas: