The realities of 5G: there’s more to the story
David, what can Australians expect as 5G services roll out over the next couple of years?
David Kennedy: The sorts of things that consumers can expect from 5G is that it will deliver data more quickly and it will be a more responsive network. Applications will feel snappier and there will be less latency when you are waiting for a response.
At the same time, 5G will still cost you something – you are not going to get it free! You will still have a data package like you do now and if you want unlimited data, then you are probably still going to have to pay a premium for it.
The cost of an unlimited package on 5G relative to the cost of an unlimited package [over the nbn™ broadband access network] is going to be higher. You will be able to buy an unlimited package on 5G but it will cost you quite a bit of money.
Overall, buying mobile data is going to remain significantly more expensive than fixed network data.
As a result, fixed networks and the [nbn™ access network] in particular are going to have an advantage when it comes to big bandwidth applications, such as video that generate most of the traffic on the network.
How is 5G going to be different from 4G?
DK: One of the problems with the spectrum frequencies that 5G is using is that because they are high-range frequencies that their in-building penetration is going to be quite poor.
So if you want a reliable high-speed broadband service delivered via 5G to your home, then you are going to need an external antenna put on your house to receive the signal.
The cost of doing this undermines the business case for Fixed Wireless access and what that means is that it will be uneconomic in some cases to actually do that.
How long is it going to take before we see 5G available nationwide?
DK: It is going to take longer to roll out 5G nationally in Australia than it took to roll out the 4G network.
The reason for that is all the new base-stations that are required to operate a 5G network. A lot of new fibre has to be deployed and, on top of that, there needs to be a business case to roll out that fibre.
Initially, 5G will be rolled out in areas where the 4G network is struggling to carry all of the data that is already there, so it will be about catching that extra data capacity.
Over time, the 5G network will roll out further and further but it will be slower than it was with 4G.
So, operators are going to need to take their own fibre much deeper – what else is new on 5G?
DK: The biggest new challenge for operators in building a 5G network will be the number of base-station sites that will have to be acquired and also maintained by the network operators to build and operate the network.
The second point is about capacity, people are using more and more data all the time, they are watching more and more video.
Some of that video is going to be on the mobile network but much of it will be watched at home because that’s where people like to watch video on a fixed-connection.
As that capacity demand grows, fixed broadband is in a very strong position to meet the requirements of a big video stream in the household.
David Kennedy is Practice Leader at research firm Ovum.
The views expressed here are those of Ovum and do not necessarily reflect those of NBN Co.