The next great technological transformation is under way as 5G telecommunication systems undergo testing prior to commercial deployment in many markets. Mobile operators will be at the forefront of creating a new platform capable of transforming industries and becoming a catalyst for global economic growth.
Making the transition to 5G is becoming more urgent as global network capacity is reaching its peak, while the Internet of Things (IoT) is taking hold in a big way. Hundreds of millions of devices are already connected online, some of them mission-critical, and their number is growing exponentially. A new communications ecosystem with unprecedented reliability and security will be essential to drive productivity in the future.
Many countries in Asia Pacific are paving the way for 5G with governments and operators starting to streamline policies and processes to help create a healthy investment climate.
By 2025, the region is expected to be the largest 5G market with 675 million connections accounting to over half of the total number of global subscriptions, according to the GSMA, a European trade body that represents more than 750 mobile network operators.
"5G is designed as a platform for industry transformation. While there is a lot of hype about 5G, the reason for deploying it stems from a combination of many things," Paul Scanlan, chief technology officer of Huawei Technologies, told Asia Focus on the sidelines of GSMA Mobile 360 -- Digital Societies, held recently in Bangkok.
Current 4G networks contain many limitations that 5G sets out to address architecturally. The three main challenges, he said, are throughput (speed), massive connection capability and latency.
"If data growth is in excess of 20% per year, then 5G is cheaper to deploy. Today, most of the networks around the world are already running at 50-60% (annual data growth). The reason for this is that 5G from an architecture perspective is spectrally far more efficient," said Mr Scanlan.
"One of the things that is driving the interest in 5G, aside from the potential for revenue and new growth opportunities, is the fact that there is enormous data traffic growth that is putting big pressure on today's network," said Nadine Allen, president and country manager of Ericsson (Thailand), the local unit of the Swedish telecom equipment supplier.
Mobile broadband services used by consumers will also benefit from 5G. In addition to improved network performance, 5G will make possible new features such as virtual reality applications, she pointed out.
A visitor walks through a 5G wireless broadband technology display by Intel at the Consumer Electronics Show in Las Vegas in January this year. Photo: Reuters
"In the next six years, data traffic is expected to grow by eight times," she said, most of it generated by smartphones, and with Northeast Asia having the largest share.
A report by Ericsson forecasts that by 2023, 20% of all mobile data traffic will be carried by 5G networks.
"Globally, factors that drive higher usage include improved device capabilities and more affordable data plans, as well as an increase in data-intensive content," it said. "As virtual reality (VR) and augmented reality (AR) technologies are more widely adopted, content will be even more data-intensive."
"It's staggering growth and we need to make sure that we are building capable networks that can deal with this growth and expansion that we are seeing going forward. It will be very important that 4G networks are capable of being evolved to 5G," said Ms Allen.
"5G is not just another G. Conceptually, it is designed to have the performance and the responsiveness to support a whole host of new use cases and also to deliver to governments, societies and businesses the ability to generate new levels of productivity and new revenue generation streams."
MASSIVE VS MISSION-CRITICAL
In the context of IoT, 5G applications have been categorised into two main types: massive IoT and mission-critical IoT.
The former refers to connections for large numbers of devices and machines on a regular basis. The latter relates to mission-critical applications where uninterrupted and robust exchange of data is of the utmost importance.
Huawei Technologies predicts that by 2025, more than 100 billion connections worldwide will be "live" through IoT, underlining the need for networks that can support millions of devices and sensors that will be connected.
"Massive IoT and critical IoT are definitely the key areas that we will look to extend and develop with the evolution of 5G going forward," said Ms Allen. "The use case of 5G is so broad because technology evolution will touch every industry; however, it will be country-specific and based on the activities and demand within that country."
In Asia, for instance, some of the activities that governments are looking into include smart metering for energy consumption, traffic management and fleet tracking.
"When we connect people, the number of connected people on the planet will be about 7.5 billion, but when we talk about IoT beyond machines to machines, there will be an order of magnitudes that is much more than that," said Mr Scanlan.
A model of a 5G wireless connected factory is shown at the Huawei booth at the Mobile World Congress in Barcelona in February. Photo: Reuters
"Every single thing around you is going to be connected. It might seem a little bit strange today but it will happen. And from the architectural perspective, 4G isn't ideal to do that."
For mission-critical IoT, failure-proof security and reliability without any human intervention will be essential. While mission-critical systems share some common technologies with consumer-based IoT in areas such as sensors, cloud platforms, connectivity and analytics, a malfunction of a mission-critical device or service could be life-threatening and catastrophic.
Think manufacturing as a service with 3D printing enabling mass customisation, proactive healthcare where health irregularities could predict significant incidents and autonomous vehicles where vehicle-to vehicle communication is common.
"Such extreme outcomes are a key reason why strict adherence to requirements like reliability are so essential in mission-critical IoT. It is also part of why designing for mission-critical IoT is so challenging," said a white paper by Ixia, a California-based network security specialist.
"Mission-critical IoT would require a combination of robust performance to withstand harsh and/or remote environments, precision and accuracy to work in manufacturing processes synchronised to milliseconds, low latency to enable real-time communication, programmability to support new manufacturing processes, and scalability to support large-scale networks with tens of thousands of controllers, robots and machinery."
Ericsson Thailand president Nadine Allen predicts a $2.6-billion revenue opportunity for IoT applications by 2026. Photo: Phongrob Promchin
"This is where latency comes in and the ability to have very strong responsiveness to enable mission-critical IoT," added Ms Allen of Ericsson.
According to Mr Scanlan, latency today is around 50 milliseconds, to 20 milliseconds at a minimum. However, for mission-critical applications such as manufacturing, robotics or connected vehicles, the required 1-2 milliseconds of latency cannot be achieved with 4G.
A recent study by Deloitte noted the importance of collaboration between governments, carriers and other stakeholders to create the appropriate policies and ecosystem for 5G.
Some of the first adopters and government-backed initiatives to embrace 5G are in China, South Korea and Japan. They may achieve a competitive advantage as a result.
Ms Allen said better network capacity could help support inclusion and maximise competitiveness of the business sector, generating new revenue streams by using mobile capability. Advances in public security, enhanced efficiency and integration of digital government will also be possible.
All of these require 5G and the development of national infrastructure that becomes a national asset, she said.
For operators, the key is to protect today's investment while building capabilities to leverage what they already have. They also need to make sure that they can meet the demand for capacity without affecting the user experience.
Networks will need the flexibility and capability to allow new use cases to develop, as operators and their customers alike look for new revenue generation opportunities and improved productivity. But they need to do that in a way that minimises the total cost of network ownership.
In China, the government has outlined a five-year economic plan for 5G-related investment worth US$400 million. It has already outspent the United States by $57 billion in wireless communications infrastructure and built 350,000 new cellular sites since 2015, compared with fewer than 20,000 in the US, Deloitte reported.
The South Korean government, which is also at the forefront of 5G trials, has mandated that all mobile operators collaborate on a single nationwide 5G network, which will help cut infrastructure costs by up to $938 million. The government has also invested $350 million in the Korea Virtual Reality–Augmented Reality Complex (KoVAC) as part of its vision to become the leader in AR/VR technology.
"Mobile operators in Asia will invest almost $200 billion over the next few years in upgrading and expanding their 4G networks and launching new 5G networks in order to accelerate the growth of Asia's digital economies and societies," Mats Granryd, the director-general of the GSMA, noted in a recent report.
Out of 72 operators undertaking 5G trials worldwide, 31 are in Asia Pacific, according to data compiled by Viavi Solutions, a network testing and monitoring solutions provider. They include KT, SK Telecom and LG Uplus in Korea; China Mobile and China Unicom; NTT DoCoMo in Japan, StarHub in Singapore and SmarTone and Hutchison Telecom in Hong Kong.
Others involved in laboratory-based testing include Australia's Telstra and Optus, Singapore's M1, Japan's SoftBank, Taiwan Mobile, the Philippines' Smart Telecom, Malaysia's Celcom Axiata, Sri Lanka's Dialog Axiata and Vodafone.
NOT ONE SIZE FITS ALL
5G deployment is not a one-size-fits-all proposition and will not be simple, because Asia Pacific is a diverse region that requires various solutions to fit the environment and conditions of certain geographic areas.
"Cities in Asia Pacific are very diverse. Some cities are very densely populated. The number of people per square kilometre is very high. If we want to provide 3G-or 4G-based solution, it will not be as efficient in that area spectrally as you need a lot more sites and base stations that will cost a lot more," said Mr Granryd.
"It's going to be impractical to find sites. The architecture of 5G is more suitable for densely populated areas."
In China, given the current deployment of nationwide 4G and the large population, the priority is to drive 5G towards the lower-frequency 3.5 GHz spectrum, then use massive multiple-input and multiple-output (Mimo) technology as part of the core 5G to solve 4G cell-edge problems, according to Li-Ke Huang, the research and technology director at Viavi Solutions.
Similarly in Japan, densely populated areas and high-rise buildings mean that Massive Mimo for lower frequency is the way forward, he said.
For sparsely populated areas, however, the more efficient solution than the current one, which is fibre, could also be 5G. Fibre will take a lot of years to deploy and the majority of the cost, around 70-80%, is in digging up roads and installing civil infrastructure.
"You waste a lot of money and it takes a long time to deploy fibre," said Mr Scanlan. "Because of the design of 5G, we are able to deploy 5G through fixed wireless access. … Operators in the US have announced that they want to use 5G for wireless technology. We will also see the same in certain rural areas within Asia Pacific."
Experts agree that for operators who aspire to go beyond what they are today in terms of being connectivity providers, the time is now for them ride the evolution of 5G and gear up for the ubiquity of IoT, said Ms Allen.
"In Thailand alone, by 2026, there is a $2.6-billion revenue opportunity available to operators in IoT in manufacturing, energy, utilities, public safety, healthcare, public transport, media and entertainment," she said.
"With the way that 5G architecture has been designed, the biggest opportunity for telcos today is industry transformation using 5G as a platform," Mr Scanlan added.