Author(s): Raghu Gopal
Last week, AT&T revealed that it will roll out mobile 5G services in over a dozen US markets by the end of 2018. This follows an announcement last month by 3GPP, the international wireless standards body, that it has completed the non-standalone 5G radio specification. This is a landmark for the industry, as it will allow chipset and device makers to start developing and commercialising non-standalone 5G hardware that conforms to the standard. Qualcomm has said that it's targeting the first half of 2019 for the first 5G-based smartphones.
Fifth-generation wireless standards are designed to offer greater bandwidth and lower latency than 4G, which will help create advanced consumer and enterprise uses such as mobile streaming of 4K and virtual reality content, smart cities and autonomous-driving grids, and, potentially, remote surgeries. Like previous wireless generations, 5G has gone through a hype phase (see Network Theatre). Although massive machine-to-machine and mission-critical applications in areas like healthcare represent the 5G vision, we believe that capacity for mobile usage, and video in particular, is the justification for deployment in the near term (see Mobile Broadband Set to Dominate 5G Adoption).
For AT&T, this is about achieving first-mover advantage and making a statement, showing its ambition of being an industry leader rather than follower. A successful launch in 2018 would make AT&T the first carrier to offer mobile 5G services in the US. We note that "mobility" is an important aspect with the carrier's statement, given that Verizon is already trialling pre-standard fixed Internet access services using 5G for the last mile. Prior to this announcement, the expectation was that the first 5G launch in the US would be for fixed-wireless rather than mobile uses. However, details of AT&T's fifth-generation mobile service have been thin on the ground, and the carrier has given almost no guidance on areas such as device availability, reach and spectrum.
Although 5G is grabbing headlines, LTE still has a long life ahead as it progresses gradually. AT&T will continue with what it terms its "5G Evolution", exploiting the latest 4G technologies such as 256 QAM, 4x4 MIMO and three-carrier aggregation to reach gigabit speeds, which it aims to offer in "hundreds" of US markets.
Needless to say, AT&T's rivals have their own 5G strategies and timetables. T-Mobile US will use its recently acquired 600 MHz radio spectrum to offer "real, mobile, nationwide 5G" services by 2020. This spectrum could become a service advantage for T-Mobile as such low-band radio waves travel further and penetrate buildings better than high-frequency bands being used by other US carriers. It's a strategy of coverage rather than capacity of speed, at least initially. Sprint announced in 2017 that it was working with its parent company SoftBank and Qualcomm to develop a high-band 5G solution in the 2.5 GHz range, which it planned to deploy in "late 2019".
Verizon, the largest wireless carrier in the US, aims to introduce fixed-wireless services using 28 GHz millimetre-wave spectrum in up to five markets during the second half of 2018. It plans to offer residential Internet access using fibre to the neighbourhood, with 5G microcells connecting to equipment in customers' homes. Verizon has chosen Sacramento, California to lead this roll-out. With this service, it will be competing against providers of fixed-connectivity services, such as Comcast and Charter Communications, rather than mobile carriers.
There's a leapfrog effect happening, as carriers in the US and around the world try to outmanoeuvre their rivals in a bid to make headlines and win a badge of honour. Only this week at the CES show in Las Vegas, Verizon chief technology officer Hans Vestberg insisted the carrier will be first to launch 5G services in the US, despite the ambitions of its biggest rival. This is positive news: 5G is working its way through a predictable cycle, as leading carriers and equipment providers spur adoption. Although the business case for 5G is a challenging one for carriers, factors such as competition and the need for capacity are fuelling investment. AT&T's announcement is limited in detail but will, nonetheless, fire the starting gun on 5G.