The 5G ecosystem has evolved significantly over the past two years. In the race towards 5G commercialisation, stakeholders across the telecom domain have stepped up their efforts to enable this technological transition. Governments, telcos, device and handset manufacturers, infrastructure providers, software and technology vendors are gearing up for 5G adoption. As a result of these collaborative efforts, a total of 180 5G networks have already been launched in 72 countries as of October 2021. Further, efforts to deploy 5G networks in the remaining countries are under way. According to the Global mobile Suppliers Association (GSA), 465 operators in 139 countries are currently investing in 5G networks in the form of tests, trials, pilots, planned and actual deployments. These upcoming deployments in the ever-evolving 5G space would open up a range of opportunities across the telecom value chain.
A look at the key trends and emerging opportunities in the 5G ecosystem…
Global market overview
Globally, Hong Kong SAR, China, was among the first countries to roll out 5G services. As per a report by Moody’s Investors Service, the country’s 5G adoption rate will remain the highest among the early adopters. Further, South Korea and China will maintain their lead in the adoption of 5G services. Governments have been instrumental in early adopter markets like China, Hong Kong and Malaysia. The governments in these regions have supported the roll-out of 5G by offering reasonable spectrum prices and undertaking proper infrastructure planning.
In terms of 5G devices, a GSA report states that the number of announced 5G devices reached 1,060 during the quarter ended September 2021, up from 21.4 per cent sequentially. Among the announced devices, 66.4 per cent or about 704 devices are now commercially available. Further, as of September 2021, 128 vendors announced available or upcoming 5G devices.
As 5G becomes mainstream through affordable devices and various use cases, the number of 5G connections will rise by three times from less than 700 million in 2021 to more than 2.1 billion by 2025, according to research by Bain & Company. As per the firm’s analysis, 5G will be adopted more quickly in the first seven years of its commercial deployment, that is, from 2018 through 2025, as compared to 4G in the seven years of its commercial launch in 2009.
As far as revenue metrics are concerned, global revenue from 5G services is expected to increase to more than $600 billion by 2026 and advanced data capabilities will support its adoption in areas such as mobile gaming and immersive reality.
Indian scenario
Telcos in India had started taking initial steps towards 5G at the end of 2020, signalling their readiness for a commercial launch. For instance, Jio had confirmed that it is developing a home-grown, indigenous 5G network and is also working on making its own massive multiple-input multiple-output and 5G small cell equipment for commercial deployment. Meanwhile, Bharti Airtel, in January 2021, undertook a 5G test on its network in Hyderabad through non-stand-alone network technology. The telco had stated that its network is 5G ready and just needs regulatory approvals to enable the software update to offer 5G services.
Considering telco readiness, the Department of Telecommunications (DoT) undertook a big move in early May 2021 and gave permission to Indian telcos to carry out 5G trials in the country. DoT granted permission to Reliance Jio, Bharti Airtel, Vodafone Idea Limited (Vi) and Mahanagar Telephone Nigam Limited. This go-ahead for 5G trials paved the way for telcos to validate 5G frequencies that can be used for commercial launch and India-specific use cases. Further, DoT’s move to allow telcos to use their own spectrum for trials in addition to the experimental spectrum allotted by the department was well received by the industry.
Post DoT’s approval, all three private telcos have undertaken 5G trials in different parts of the country. For instance, Bharti Airtel conducted 5G trials at Mumbai’s Phoenix mall using the 3500 MHz band in partnership with Nokia. Airtel’s 5G trial network was live in Gurugram’s Cyber Hub. The site was operating in the 3500 MHz band using Ericsson’s 5G gear. Recently, in October 2021, Airtel and Ericsson conducted 5G network demonstrations in rural geography. The demonstration took place in Bhaipur Bramanan village on the outskirts of Delhi-NCR. Airtel also carried out India’s first cloud gaming session in a 5G-based setting. The pilot was conducted in Manesar.
Reliance Jio conducted 5G trials in Mumbai using its indigenously developed 5G equipment and technology. In Delhi, Jio conducted trials jointly with Ericsson and in Pune with Nokia. Meanwhile, trials in Gujarat are being conducted with Samsung. Vi initiated 5G trials in Pune and Gandhinagar in partnership with Ericsson and Nokia.
As telcos keep conducting 5G trials, DoT seems to be gearing up to conduct a 5G auction soon. In September 2021, DoT approached the Telecom Regulatory Authority of India (TRAI) seeking its recommendations on pricing, quantum and other specifications of radiowaves in multiple bands for 5G spectrum auctions. As per industry sources, DoT has sought TRAI’s inputs on the base price, quantum and modalities of spectrum across multiple bands. These include bands such as 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz as well aa the 3,300-3,600 MHz bands, which were not put up for auction in the last round, and the millimetre wave band (that is 24.25-28.5 GHz). Moreover, recommendations have been sought on the reserve price, block size, band plan, and quantum of spectrum to be auctioned.
Over the next few months, India’s 5G trajectory will be guided by technology trials as well as DoT’s spectrum auction plans. The trials will help DoT in planning how much spectrum should be put up for auction and in which bands. Furthermore, the move will help determine 5G viability across rural and semi-urban areas since it is mandatory for telcos to conduct trials in these areas as well.
The industry is hopeful that in the run-up to the 5G auctions, the government would be open to revisiting its 5G spectrum pricing and airwave allocation plan, and that the forthcoming 5G trials will pave the way for successful 5G commercialisation in India.
Infrastructure requirements
Apart from spectrum needs, 5G has a massive requirement for infrastructure like small cells, fibre and towers to support such high speed and low latency services. Small cells are an essential component of telcos’ 5G roll-out strategies. 5G deployment requires radio equipment to be closer to the consumer than it is in 3G or 4G networks, which makes small cells a natural fit for 5G roll-out. At present, telcos are focusing on deploying small cells in low frequency bands for delivering improved bandwidth to customers. However, post-2021, the small cell network is expected to expand on the back of internet of things and machine-to-machine technologies. In addition to network densification benefits, small cell deployment offers cost savings to telcos. As per industry analysts, small cells offer savings of about 40 per cent on site rentals, energy costs, etc.
Moreover, 5G adoption across networks would entail the deployment of high frequency LTE spectrum such as 50 MHz+ on the 2300 MHz and 2600 MHz bands. This, in turn, would require fibre-based backhaul. As per industry reports, the site count for 5G networks will double from the current 0.5 million to around 1 million by 2022. New sites will require network densification, including the deployment of small cells and increased fiberisation of tower sites. Operators are actively working towards achieving this goal. Indian telcos including Reliance Jio, Bharti Airtel and Vi have started revamping their backhaul networks to achieve a healthy microwave-fibre mix. This enables them to leverage fibre’s virtually unlimited capacity and extensive reach.
5G network testing
Another key aspect necessary for rolling out 5G services is testing of such services. The growing complexity of 5G devices calls for developing a unified interface to test across all layers. This will help simplify signalling tests and obtain a holistic view of the design validation test process. Companies across the testing and measurement (T&M) domain need to ensure that testing of 5G networks and devices incorporates everything, from standardisation of new processes to the development and manufacturing of components, wireless devices and base stations.
As the technology behind wireless devices is extremely complex and sophisticated, the telecom sector requires T&M solutions that can help address this complexity with new technology standardisation, product design and production. In addition, frequent testing and continuous optimisation of the network are critical to provide optimal quality of experience and service.
To this end, the India government is establishing a 5G test bed at the Indian Institute of Technology, Madras, for 5G testing purposes. The project, worth Rs 2.25 billion, is being funded by DoT. It began in 2018 and will be operational soon. The test bed will allow telecom service providers and their technology partners to undertake trials and demonstrate local use cases to speed up 5G deployment in the country.
Complementary technologies
There are a number of next-generation technologies that are expected to witness increased traction once the 5G era begins. For instance, several new communication demands will emerge from a range of devices, users and companies. To sufficiently manage these demands and support a diverse range of services, 5G networks will have to be programmable, flexible, modular and software-driven. In this scenario, software-defined networking will play a key role by enabling network programming. A programmable 5G network will provide service agility by reducing the time for service creation and adaptation, and increasing resource efficiency by allocating the right number of resources wherever needed.
Another disruptive concept that will emerge in the 5G era is network slicing. Through network slicing, a single 5G physical network can be sliced into multiple isolated logical networks of varying sizes and structures, dedicated to different types of services. It will allow operators to create different levels of services for different enterprise verticals, enabling them to customise their operations. To leverage these benefits, operators will have to adopt network function virtualisation solutions, which provide the necessary infrastructure for the orchestration and automation of network slices. Each of these network slices will have its own characteristics in terms of speed, latency and quality of service.
Open radio access network (O-RAN) would be key to facilitating the roll-out of 5G networks. According to industry reports, 5G deployment costs are expected to fall by 30 per cent between 2019 and 2022 if a network is built in the traditional way, and by 50 per cent if it is based on open architecture. Open RAN enables operators to increase the number of their network infrastructure partners, and deliver better and more cost-effective 5G networks.
Challenges and the way ahead
While the overall 5G ecosystem is experiencing constant evolution, a few key challenges continue to hamper its growth. One of the biggest challenges pertains to the deployment of fibre, especially in India, as the country has a very high number of fibre cuts. Globally, telcos are using cables with 144 and 288 count fibres instead of 48 and 96 count ones, but that is not the case yet in our country. In India, if an operator invests in a 288-count fibre cable and if it gets damaged in a couple of years, then the operator cannot draw any reasonable return from the cable. Further, the high price of 5G airwaves in India, unwillingness of users to migrate from 2G or 4G to 5G and the capital expenditure to deploy a full-scale commercial 5G network are other factors that might deter the deployment of 5G. These challenges, especially those that hamper increased fiberisation, need to be resolved to ensure speedy commercialisation of 5G services in India.
Going forward, the country needs to learn from the front runners in terms of 5G commercialisation and follow a collaborative approach to ensure that the evolution of the 5G ecosystem enables the growth of stakeholders across the telecom value chain.
