Recent LTE advances could affect demand for 5G: experts

Even with an accelerated arrival date for the next generation of wireless technology, companies haven’t stopped working on wringing out more from the current 4G standard, and the unexpected advances they’ve made could lessen the appeal of 5G, according to some experts. “As the telecom engineers around the world work with , they are surprisingly being able to do more with those technologies than they would have thought two years ago,” Duncan Stewart, director of technology at Deloitte Touche Tohmatsu Ltd., said in a phone interview. “That, theoretically, is cutting into some of the unique advantages that 5G had and it may, therefore, make it less compelling to move to 5G as fast,” Stewart said, adding the impacts are still difficult to determine. Earlier this year, the 3rd Generation Partnership Project (3GPP) wireless standards body signed off on a new proposal to bring 5G services to consumers as early as late next year — a year ahead of schedule. Meanwhile, the 4G LTE standard, in all its variations, has been reaching new heights. Most recently, in a trial test last month, Verizon Communications Inc., Qualcomm Inc. and Ericsson AB eclipsed gigabit download speeds for 4G LTE. Canadian carriers have been releasing ever-faster speeds on the current generation network. BCE Inc., for example, earlier this year launched what it described as the first quad-band LTE-A in North America, based on four-carrier aggregation, or the combination of different spectrum bands to improve like metrics like network capacity and efficiency. It has since expanded the service to at least 40 cities in the country. The amalgamated spectrum increases theoretical data speeds from 335 Mbps (average download speeds of 12 to 100 Mbps) to 550 Mbps (18 to 150 Mbps) — speeds that some say are more than enough for regular users. “One of the reasons why 4G is going to hang around is that its top end in terms of speed and latency and so forth is already more than sufficient for most real-world cases in the near term,” Stewart said, adding he expects 4G to be around for a long time, with forced adoption maybe being in 2030 or 2035. “I’m now thinking that things are possible that I would’ve thought were impossible back in April, that’s how rapidly it’s moving,” Stewart said in an August interview, adding: “I expect that by January, we’ll know an awful lot more than we do today.” Analysts have also taken note, with Desjardins Capital Markets analyst Maher Yaghi writing earlier this year that 4G LTE still has “untapped potential.” Yaghi cited a field test by Sprint Corp. and Samsung Electronics Co. Ltd. that pushed the LTE standard to speeds of 330 Mbps per channel, a four-fold increase. “We believe advances in LTE are a positive sign that innovation continues within existing standards,” Yaghi said in the note. In an earlier January note, Yaghi noted that “market demand for 5G is not there yet, in our view, nor do we expect it by the end of 2018, especially if 4.5G expectations are fulfilled. Given the usual lag experienced in Canada, we still do not believe the Canadian telecom companies will deploy the 5G standards (and, hence, commit significant capex to this technology) before 2020.” On top of its four-carrier aggregation announcement, Bell announced it was launching its LTE-M network in 2018, aimed Internet of things (IoT) devices — one of the use cases for 5G. Bell spokesman Murray MacDonald said in an email that the company will make both "continuous improvements in 4G speeds that take advantage of future advances in spectrum and handset technology," and continue with 5G research, development and testing. "When 5G starts to be commercially available its real impact is going to be in the areas of mobile broadcast video and Internet of Things applications, including connected vehicles and city-wide IoT solutions. That’s where you’re going to see the game changing effect of 5G technology. LTE and 5G will coexist for many years to come," MacDonald said. Rogers Communications Inc. spokeswoman Sarah Schmidt said in an email that the company is investing in and testing the technology to lay the groundwork for 5G, the evolution to which will be needed to support the growing use of mobile broadband data and connected devices for consumers and businesses, while also enabling new services and capabilities not easily delivered with current technology. "LTE will remain an important part of mobile wireless networks for many years and will be integrated with 5G to connect customers with what matters to them,” Schmidt added. On Friday, research released by 5G Americas found that global LTE subscriptions increased 59 per cent between June 2016 to June 2017 to 2.37 billion, a Friday press release said. North America achieved 327 million LTE subscriptions compared to a total population of 362 million by the end of that period, with LTE penetration expected in the region to pass 100 per cent next year. Stewart said that he has spoken to carriers around the world and, with the exception of countries like the United States and parts of Asia, found that “a not trivial number of carriers” have said “bluntly...we see 4G, we see 4.5, we see 4.9 and we have plans and a roadmap for all of that. We don’t yet see why we have to move to 5G.” For that reason, Scotiabank’s telecom analyst Jeff Fan said in a phone interview carriers will still need to build the business case for 5G, despite its progress toward implementation. “The question that a lot of operators have to ask themselves is, what does 5G bring to the table that is not being addressed by 4G?” Fan added that carriers will have to ask themselves, if people are getting what they want out of 4G with speeds of 30 or 40 megabits per second, “will they pay more to go to 5G, will they use it more on 5G and will you be able to charge more to justify that investment to 5G?" “Or is it better to just continue to invest in 4G and give them the speed and people will pay for that to justify the less significant investment that you had to make on LTE?” Fan added. As recently as May, participants at the Wireless World Research Forum’s 5G huddle noted that it isn’t yet possible to see 5G’s biggest driver. The experts the Wire Report spoke to for this story all noted lower latency and higher speeds as big benefits for 5G. Gartner analyst Bill Menezes said in an email 5G will also help alleviate the growing network congestion from the increasing consumption of data through uses such as high-definition video streaming, by being able to serve more devices per cell tower. In the meantime, however, Menezes said if 3G is used as a guide for 4G’s longevity, then it is going to be a “long time” before 4G is relegated to a bygone era, especially with the already-mentioned developments in LTE-A. He added that the rollout of 5G will likely be concentrated in densely populated areas first because of its shorter transmission signals, which means that 4G will still be needed for extra urban and rural areas. Fan, who said he anticipates 4G sticking around for at least another decade, said carriers will need to identify those drivers. “Operators should start — and I’m sure they are already — to think about business applications because one of the benefits of 5G is lower latency,” which is important for areas including e-health applications and autonomous driving, he said. That includes asking how to “combine that network capability on 5G and the business needs for wireless applications to bring solutions together to the market.” Menezes also suggested the case for 5G must make business sense. “They will need to show a value proposition differentiating it as the platform for applications users want,” Menezes said. “Do they want to use a cellular connection instead of cable for their TV? Then it better be no more expensive, at least as reliable and offer additional features such as access over multiple devices in multiple locations.” Fan agreed, suggesting the performance and cost on 5G’s fixed-wireless must be “dramatically better” than cable Docsis 3.1 or the telcos’ fibre-to-the-home for it to become a big driver. “If I have a cost-effective multi-gigabit fiber to the home connection that serves 99% of my streaming video needs … I may never need it,” Menezes said. But experts said that, despite the long life still ahead of 4G, you can only get so far with techniques like carrier aggregation. “Carrier aggregation enables to use multiple channels covering multiple spectrum bands in order to increase capacity and speeds to an individual device, but at a certain point it likely would become cost effective to use 5G for many types of traffic,” Menezes said. Stewart added that carrier aggregation is also “not particularly scalable” if you want to provide top speeds to a wide swath of customers at the same time. “The whole point of moving to 5G is that it would allow for more cost-effective, spectrally efficient coverage and provision of these high-speed, low latency services to many, many customers all at the same time.” Moreover, 5G is expected to have a network capacity that is a hundred times greater than 4G networks, the August 5G Americas report noted. That means 5G “will make wireless connections not only a viable substitute for wireline broadband connections for tens of millions of users over the next ten years,” but make that connection the only one many users need, the report added. 5G networks are also expected to come ready with software-defined networking (SDN), which will allow carriers to quickly set up and reconfigure their networks through software instead of physical rewiring, giving them a cheaper and more flexibility option, Stewart said. But even then, Stewart added that it would be surprising if 4.9G couldn't make use of SDN too. “Maybe not quite as well, but pretty good.” “We do not need 5G this year or next year,” Stewart said. “Will we need 5G in 2020 and beyond? There are a variety of applications that look like they will work in 5G but not in 4.9, but one of the problems is that it’s a moving target —4.9 keeps being able to do things that like two years ago, we didn’t think it would.” — With reporting by Ahmad Hathout at ahathout@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Recent LTE advances could affect demand for 5G: experts

News | September 8, 2017

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