Where is 5G in its Hype Cycle?

If you are familiar with the notion of hype cycles, you will not be surprised if a period of hype about 5G is going to be followed by a period of disillusionment, before the actual benefits are reaped commercially.

So you should not be surprised that skepticism about 5G continues to be voiced, especially by service providers who argue they have yet to make money from 4G, from suppliers who may not feel best positioned to profit from 5G infrastructure sales, or from analysts, consultants or journalists who need some amount of controversy to drive readership and attention.

By now, you are accustomed to hearing concerns about the business model for 5G, especially as it compares with 4G use cases. As 4G gets better, the difference between advanced 4G and early 5G, from a consumer or business user of smartphones, is likely to be a bit subtle, at least in some cases.

And, yes, it remains to be seen how big a deal virtual reality, augmented reality, internet of things generally, connected cars and other “exotic” apps are going to be.

The point is that, for consumer users of smartphones, 5G will be an “evolution” from 4G. But 5G will be a discontinuity where it comes to many new applications that require ultra-low latency. As was true for 3G and 4G, promised new apps will develop, or not, as value is able to be reaped and demonstrated.

Those new value propositions are more likely to be found in the enterprise parts of the market (sensor apps, connected car, industrial VR/AR, as well as some consumer apps (4K or 8K TV, AR and VR for gaming).

But it is worth remembering that new platforms have to scale before app developers have addressable markets large enough to serve. That is the way it always is. It remains largely true that, except for supporting multi-user households or businesses, there are few killer apps for gigabit internet access. So far.

To the extent 5G creates or enables big new use cases and revenues, it will take a while, as scale has to be gained before it makes sense for app, device and platform suppliers to charge ahead with commercial offers.