While others were talking about 5G, we were building it
Vodafone New Zealand CEO Jason Paris shares more insights on one of the telco’s ‘big bets’ ahead: 5G.
Internally, we call it ‘Project Jackson’, he says, a reference to the 70s music group.
Project Jackson, he explains, is about 5G leadership.
“We are seeing real business benefits in other markets where it has been launched - UK, Germany, Italy, and Spain,” says Paris, at a recent Trans-Tasman Business Circle Forum.
Vodafone is upgrading all its 4G towers for this, he says. “Regardless of where you sit on the technology value chain, you will notice significant improvement on our great mobile network.”
“We keep our cards close to our chest on this one,” he states.
“While others were talking about it, we were building it.”
“We want to make sure we will create strategic advantage for ourselves, but more importantly, create strategic advantage for businesses.”
He further adds, “We have seen as 5G is being rolled out across the world, we expect to see use cases in the consumer segment.”
“This is a technology that is 10 times faster than 4G, and it also has a much lower latency and lag than 4G. What we have seen is the big business benefits from this technology.”
“This is because 4g was the transformation of the smartphone, 5G is the transformation of the Internet of Things,” he says.
According to Paris, with IoT, “everything is being connected to everything superfast, with no lag or latency.”
He shares some examples across the globe.
One of this is automated manufacturing. He shows a slide of a dark room, seemingly. When the lights are switched on, however, the photo shows machines at work. “There are no lights because machines do not need light.”
He says use of 5G need not be transformational. It can be as basic as providing smart energy in schools.
In China, for instance, small sensors automate heating and lighting time in schools.
Paris sees the possibilities of innovative work using 5G in New Zealand.
“As we launch this within the next four months, we will start 5G use cases to stimulate others,” he says.
Into the fast lane
Industry research company IBISWorld notes how Vodafone’s announcement to begin constructing a 5G mobile network is shaking up New Zealand’s mobile market.
“Rival telecoms Spark New Zealand and 2degrees are also anticipated to roll out 5G networks over the next several years. However, these rollouts aren’t expected until at least 2020, giving Vodafone a competitive edge in the 5G market,” says Liam Harrison, senior industry analyst, IBISWorld.
“As a result, Vodafone now has the potential to overtake Spark New Zealand as the market leader in the wireless telecommunications carriers industry,” he states.
5G, which is the latest in mobile network technology, uses high-frequency radio waves to transfer data with higher bandwidth and lower latency than current 4G networks.
IBISWorld says demand for mobile data has grown exponentially over the past five years.
As a result, consumers have become increasingly reliant on mobile data for accessing the Internet for both recreational and business use, which indicates that 5G services will likely be popular among consumers.
He notes Vodafone is currently limited in how fast it can roll out and expand 5G mobile networks, due to an existing Māori claim to radio spectrum when new property rights are created. Consequently, 5G networks are not expected to be completely rolled out until at least 2022, he discloses.
Harrison shares that mobile network operators in Australia have started rolling out 5G plans.
“Telstra has rolled out 5G networks in select areas, offering 5G access free to customers with a compatible device for the first 12 months, before charging a premium of A$15 from July 2020 onwards. Vodafone New Zealand is likely to follow a similar path,” he says.
However unlike Australia, the possibility of mobile substitution, where consumers replace fixed Internet services with mobile Internet, is expected to be limited in New Zealand.
“Although 5G is expected to provide comparable speeds to mid-tier fibre connections, data caps are likely to limit consumers substituting fixed line Internet services with mobile Internet services.
“In Australia, the National Broadband Network’s multi-technology mix model has constrained the speeds fixed line services can offer, causing mobile internet to become more viable as an alternative.”
He also says despite consumer interest in upgrading to new 5G services, most mobile phone users in New Zealand do not currently own phones compatible with 5G networks.
Subsequently, IBISWorld anticipates that the telecommunications goods wholesaling industry will receive a boost from sales of 5G-compatible phones, as demand for new handsets is forecast to spike over the next five years.
Cutting through the hype
Despite service provider hype, analyst firm Gartner points out most 5G rollouts will initially focus on the islands of deployment.
Broad availability of full-function public 5G from communications service providers (CSPs) is unlikely before 2023.
This will put some digital business plans at risk unless private networks are rolled out, according to a report by Gartner analysts Joe Skorupa, Sylvain Fabre and Kosei Takiishi.
Set realistic expectations across the organisation about 5G’s availability and cost
The report, Innovation Insight for 5G Networking — Cutting Through the Hype, notes that early public 5G deployments will be spotty in coverage, but will meet some enterprise use cases such as high-speed fixed wireless access.
It lists four ways enterprise architecture and technology innovation leaders can approach 5G:
Work with CSPs before making business plans that rely on their network service rollout plans, recognising that Proto-5G may be adequate for initial deployments.
Set realistic expectations across the organisation about 5G’s availability and cost. “Do not plan on using 5G’s eMBB capabilities until 2019, or mMTC and URLLC until 2021, at the earliest,” they state.
Define use cases that require 5G’s technology advancements by documenting their respective performance requirements in throughput, latency and scale.
Develope a migration plan to 5G that will use current technologies in the interim, if needed, such as LTE Advanced Pro for high-throughput applications and NarrowBand IoT for low-power, low-throughput requirements.
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