Even if some continue to argue that 5G will be so expensive (double or triple the cost of 4G) that there is no business model, there is reason to believe those dire forecasts will not materialize.
In part, that is because 5G infrastructure includes a number of potential cost items broader than has been the case for earlier networks. Much hinges on how much millimeter wave spectrum has to be used, which requires small cells, which in turn requires lots of optical fiber backhaul.
The capital investment model also depends on many other decisions, such as how extensive a deployment initially is planned.
A new network might be built only in urban cores. Other approaches might add suburban areas. Some cities or regions might be built first, with others only later.
Construction programs might follow the 3G or 4G timetables or could stretch out. In many cases, it will matter whether a full 5G standalone network is built, or a hybrid 4G-5G network can be used.
Another variable is how much other virtualized network capability exists; how much backhaul fiber is in place; how much open source or commodity gear is available and used.
The point is that 5G capex might well not rise all that much above what was required for 4G.
“We believe it is also reasonable to assume a gradual rollout path,” GSMA Intelligence argues. IN other words, 5G will often be built gradually, and over a longer period of time than 4G. In other words, full deployment might be phased in over seven years, instead of three, in larger markets, such as China, GSMA Intelligence suggests.
In Japan, operators claim that the deployment of 5G will not lead to any significant spike in capex, GSMA says.
Some might still disagree, but capex levels tend to be rather steady. Between 2018 and 2020, GSMA Intelligence forecasts mobile capex to be about $100 billion in
the United States, for example.
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