Opinions about the cost of deploying 5G--even the need for 5G--continue to generate controversy in some quarters. But 2018 is not 2019, and actual infrastructure investment in 5G, at commercial levels, show there is a wide variance of attitudes about the business model.
In some markets, service providers might be correct that demand does not yet exist. In others, 5G simply provides the capacity supply 4G soon will be unable to support. In some markets, the terrestrial infrastructure for backhaul will prove a challenge; it other markets, the need to support higher capacity demand already has created much of that infrastructure.
In some markets, millimeter wave capacity likely will be optional for some time; in other markets, it is among the few tools available to boost capacity dramatically.
Back in 2018, the International Telecommunications Union noted “concern that 5G is premature.” A report indicated “operators are sceptical about the commercial case” and “high-levels of investment.”
The report suggested that “industry and policy-makers should remain cautious and should consider enhancing the availability and quality of existing 4G networks in the run up to 5G.” That is a rational approach. Not every market yet requires the capacity or other features of 5G. But in some countries, 5G is simply the best way to supply capacity that 4G soon will be unable to provide.
“The need for 5G is not immediate,” the ITU said. That is true in many, perhaps most, markets. It actually is a practical capacity-boosting tool in a few markets.
In arguing that policy-makers and operators “should only consider deploying 5G networks where there is demand or a robust commercial case in favor of doing so,” the ITU report makes sense.
But the ITU report also contains the rationale for 5G. Simply, a new mobile next-generation network is introduced about every decade. That does not mean it gets introduced everywhere, nor at the same time. But nothing is going to stop 5G from being deployed, simply because network capacity demand drives it.
New use cases always are a feature of each touted digital network, but the practical reality is that, of the two main tools for increasing capacity--smaller cells and new spectrum--each next-generation network has brought additional spectrum resources.
Also, despite much concern that millimeter wave communications will be too hard to deploy commercially, even the ITU has noted that 5G--and all subsequent networks--will have to use millimeter wave assets.
Though many spectrum bands will support 5G--lower frequency including 600 MHz or 700 MHz, mid-band assets in the 3 GHz to 4 GHz region and millimeter wave region--capacity needs, even after spectrum refarming, will leave only the millimeter bands available for most of the future capacity supply.
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