5G Wireless Tech Outlook Is in the Eyes of the Beholder

NEWS ANALYSIS: While a trade group believes 5G is progressing, a PwC consultant has concerns about the high-speed wireless networking technology's future.

5G wireless

LAS VEGAS—The dream of a much faster, more robust 5G wireless network with gigabit speeds and new possibilities for businesses, consumers, education, health care, the internet of things and more remains on track to begin arriving by 2020, according to a key trade group, as 5G trials and the development of network specifications continue on a steady pace.

Tom Keathley, chairman of the trade group 5G Americas, told eWEEK here at the CTIA Super Mobility 2016 conference that the huge project remains on track and is continuing in the development, testing and specification phases as expected.

"Virtually all of the [major] carriers have started 5G trials," said Keathley. "The specifications are under way, but are not yet written. Most mobile operators will want to deploy standards-based equipment and infrastructure, so the [creation of standards is] critical for a 5G launch."

The first 5G service deployments for public use are expected in 2020, but it will take up to about 10 years after that for a full deployment, he added. "It probably will start with the use of very-high-frequency spectrum."

Yet not everyone is sold on the idea that mobile carriers will find sound fiscal reasons for spending the billions of dollars that will be needed to create an entirely new 5G network to drive their revenue and profits into the future.

Dan Hays, a consultant with PwC, told eWEEK that while all the planning for 5G sounds great, he's not convinced that mobile carriers are looking at it with the same fervor as trade groups and potential users.

"The problem with 5G today has nothing to do with its technology," said Hays. "The biggest thing inhibiting 5G is the lack of a clear business case for making the investment that's required."

Mobile carriers aren't complaining about these concerns publicly, he said, but the worries are there. "If you are selling equipment, phones and services, you don't want to paint a gloomy picture," he said of the lack of public push-back from carriers.

One problem is that the mobile industry largely has never hit the goals that were expected through the development of today's 4G networks, said Hays. "Most of the operators, if really pressed, would say they didn't see the uplift in revenues and the significant increase in devices that they had planned for 4G. As a result, there's a great deal of skepticism about how to make the 5G business case work."

A key challenge for the industry is how will it justify investing hundreds of billions of dollars, not even including the cost of buying additional wireless spectrum, into 5G if they may not see increases in subscriber revenues, said Hays. Mobile industry executives today are trying to figure out if internet of things revenues could help "save the day for 5G" by adding plenty of new devices and their associated revenues, but Hays said he thinks the answer is "a pretty clear 'no.'"

On the other hand, mobile carriers may have no choice but to invest. "It may be that you just have to do it to stay competitive," he continued. "That's a huge obstacle right now."

The issue hit home on Sept. 8 here at the CTIA event, when FCC Chairman Tom Wheeler in a keynote address discussed the status of the 5G efforts in the United States and talked about how important the network's creation will be to U.S. competitiveness and business, educational, consumer and other users in the future.

Wheeler was right, said Hays, "but forgive me for being a capitalist, you have to have some return on that investment. In the U.S., we see that inertia is the primary force that's driving the operators toward a 5G investment," and that's not enough.

What could happen, he added, is that there is "a strong possibility an [underdog] operator will jump the gun and declare that they have 5G" sometime in the next 18 months, even though their claims will not be accurate. "The American public is going to believe a lot of things," said Hays. "It's marketing. In the end, it's just labeling."

Ultimately, it will still be some time before 5G truly arrives and begins to push out the current 4G LTE network, 5G America's Keathley said. "LTE is going to have a long evolutionary path for 10 years or more," he said. "It's still going to be around."

But 4G LTE won't be around forever, he added. "I'll predict that the 4G network will be gone in 20 years," said Keathley. "All of our spectrum will be repurposed to 5G by that time frame."