5G consists of the fifth generation of cellular technology. It is built to enable faster mobile data speeds than previous 4G Long-Term Evolution (LTE) and earlier technologies. This can provide the potential for revenue growth and lower customer churn. 5G will allow networks to be virtually sliced to provide a range of different service characteristics for different use cases.

Technology Trends

Listed below are the key technology trends impacting the 5G theme, as identified by GlobalData.

The impact of Covid-19 on 5G market development and progress

Covid-19 threatens to impact the pace of 5G deployment for some operators. Social distancing measures imposed by governments during the peak of the pandemic mainly generated temporary interruptions in the 5G rollout. However, the delay of 5G spectrum auctions in countries such as Brazil, Mexico, Canada, India, Spain, France, and India, originally scheduled for 2020, could have a greater impact on the expansion of mobile 5G in the short and medium-term.

5G will open up new revenue opportunities

Previous wireless generations have delivered increased bandwidth and capacity. 5G promises to go further, adding low latency, high density, and improved reliability to bring new use cases to consumer and enterprise markets. These capabilities will be fundamental to the provision of emerging technologies such as autonomous vehicles, robotic surgery, and applications for augmented reality (AR). This could open up fresh revenue streams for telcos in vertical markets such as energy and utilities, manufacturing, and healthcare.

The range of possible frequencies gives operators options

5G can support a wide range of frequency bands, from sub-1GHz through to 40GHz and above, as well as shared and unlicensed spectrum. Operators can choose from several different deployment strategies. In the long term, 5G needs spectrum across low, mid, and high bands to deliver widespread coverage and support. Lowband deployments offer wide coverage. Mid-band spectrum, mainly the 2.5GHz and 3.5GHz bands, strike a balance between coverage for urban and semi-urban areas.

MmWave spectrum offers up ultra-high-speed access in dense urban areas. To get the most from 5G deployments, operators must understand radio frequency behaviour, the cost of spectrum, and how much support there is for certain bands.

Fixed wireless is a more vital use case due to Covid-19

Operators worldwide have deployed fixed wireless access (FWA) based on LTE technology, with a primary focus on supplementing poor or no fixed network infrastructure. However, 5G enables more use cases for FWA. It supports gigabit data speeds with low latency and higher capacity. This allows operators to offer a broadband experience akin to fibre installations without connecting cables to every household.

Network virtualisation and containerisation support the 5G business case

Network function virtualisation (NFV) enables operators to automate many, if not all, network functions. Operators can reduce infrastructure costs, and implement the scale and flexibility needed to meet exploding traffic demands. For the network operator, the infrastructure platform must provide uncompromising carrier-grade attributes. These include guaranteed service-level agreement (SLA) performance, reliability, and elastic scaling to support virtual network functions (VNFs), which can be deployed at central data centres, metro-central offices, and at the edge of the network. The telco cloud (NFVI) must also provide support for private, public, and cloud deployments.

Network slicing can help operators meet new demands

An additional advantage of network virtualisation is that NFV and software defined networking (SDN) together enable network slicing. This is where multiple logical networks are run on a common physical infrastructure. When combined with 5G, these network slices allow operators to deliver connectivity and data processing tailored to specific end-user requirements.

From an operator perspective, network slicing allows them to support specific services and business functions across industries in a reliable, secure, and flexible fashion. It is, therefore, necessary if they are to take advantage of the new revenue opportunities associated with 5G. However, it will take some time for operators to develop effective ways to monetise large numbers of network slices.

Equipment makers are pushing massive multiple-input and multiple-output (MIMO) gear

MIMO allows for the transmitting and receiving of more than one data signal simultaneously over the same radio channel. The ability of MIMO to multiply the capacity of antenna links has made it an essential element of wireless communication standards, including LTE, commonly marketed as 4G LTE.

Standard MIMO networks use a relatively small number of antennas, while massive MIMO uses large antenna arrays of 16 transceivers and receivers or higher and is, therefore, an important part of keeping up with 5G capacity requirements and making more efficient use of spectrum.

Low latency of 5G will drive edge computing investment

5G will offer significantly lower latency than other generations of cellular technology. The International Telecommunication Union  (ITU) expectis latency of just one millisecond, compared to ten milliseconds for 4G. To meet 5G’s low-latency requirements, operators will attempt to distribute functionality to the edge of the network, where it is closer to the end-user.

Network densification and the move to virtual radio access network (RAN)

The lower propagation characteristics of the high-frequency spectrum employed for 5G means that many more cells will be required if the signal is to cover the required area. The use cases for 5G, particularly those within enterprises, will require further densification to ensure availability within factories, hospitals, and so on. As radio endpoints proliferate, it becomes more beneficial to coordinate them and centralise some functions, including baseband processing.

When baseband processing is distributed to the network edge, it can support low-latency services such as remote control of robotics. This approach is known as cloud RAN or virtual RAN. It also facilitates the disaggregation of the radio access network, known as Open RAN, which is fostering a more competitive ecosystem of RAN vendors.

Enterprise use cases pose vexing challenges but offer significant rewards

Enterprises are potentially looking to adopt 5G to support innovative real-time use cases. In particular, those that require very low latency or use technologies such as AR and virtual reality (VR) for training, sales, and simulation. They may also benefit from 5G’s speed and capacity to support large Internet of Things (IoT) deployments. These require massive scale or create significant amounts of data that needs to be stored, processed, and analysed. The use of 5G in private networks to support industrial automation, campus networking, and oil and gas, mining, and port communications and control is another potential opportunity.

This is an edited extract from the 5G – Thematic Research report produced by GlobalData Thematic Research.