There are more signs that 5G hype has outrun reality, perhaps by a long shot. Light Reading summarizes their view HERE, and another alarming piece of news is that Intel won’t be making 5G chips. Light Reading ends its piece on an upbeat note, though, and many believe Intel’s decision came because of the Apple/Qualcomm settlement. Are there more signs that 5G may be a bit too much sauce and not enough beef, or are we just seeing the inevitable media shift on a story that’s run a long time?
I’ve always said that to the press, any given technology had to be either the singlehanded savior of western culture, or the last bastion of International Communism, because nothing in between would generate enough clicks. In the early days of any technology, we see a “bulls**t bidding war” as articles strive to get attention, and of course vendors and advertisers like any story that gives them a reason to call on prospects. Later on, most technology developments take more time and both readers and sponsors see the downside, so the focus tends to shift to the negative.
The truth is that 5G was never going to meet all the extravagant claims made for it, and in the near term probably won’t meet many of them at all. We are looking at 5G all wrong. It’s not going to drive augmented reality or connected cars or the Internet of Things and Smart Cities. It’s not a driver, but rather an enabler. Some of the things 5G enables were held back primarily by network-related limitations, and these will advance in an orderly way once those limitations are relaxed. Other things were speculative applications that need to prove out their business case, network issues aside. These are really no closer to realization today than they were three or four years ago. We just need to know which applications fit in what categories.
As an enabler, 5G requires two things—widely available 5G service and a strong population of 5G-capable devices. Only the millimeter-wave 5G/FTTN hybrid has the luxury of deploying at a fairly controllable pace; operators can decide when to roll it out because they control both of the two requirements. For the mobile 5G services, you need to deploy enough 5G service to make users comfortable with it, and at the same time get a population of handsets out into the market. Since 5G handsets will also surely work with 4G, the latter can be just a matter of time. The credibility of the services themselves will depend on both service cost and handset costs; users won’t pay a lot for a 5G phone if they don’t believe there will be 5G services available, and affordable.
The balance we see with 5G enabling is creating slow but steady 5G transformation, at roughly the pace of mobile modernization. My model shows that 5G doesn’t seem to have the enthusiasm that 4G had, perhaps because you can only cry wolf so many times and perhaps because the hype wave leading up to 5G (which hasn’t even yet arrived) has been so long. In any event, there are sure signs of 5G success, and I think Ericsson is probably the poster child. Ericsson has a 5G radio strategy that’s evolutionary rather than revolutionary, and it seems to be profiting the most from 5G today. As I noted in a past blog, operators like the fact that they can modernize 4G RAN and prep for 5G in one deal.
Apple’s deal with Qualcomm may be another indicator of slow-but-steady 5G progress. Intel, say my sources, informed Apple they would be exiting the 5G modem space, believing they had little chance of being a market leader there. Apple, again according to what I heard, didn’t want to deal with Huawei given its uncertain position with the US Government. What’s left? The guy you were embroiled in a lawsuit with, which is obviously not an ideal choice for Apple but surely the best currently available. And the fact that Apple felt it had to make the choice indicates it believes it needs 5G in iPhones in the near future.
Apple may, in fact, be the key to the slow-and-steady model of 5G adoption. They’re hardly the price leader in the smartphone space, but they do have a reputation for being the phone of choice for trendsetters. If the cool people like Apple and Apple likes 5G, the commutative property seems to apply and cool people will come to like 5G too. That will gradually influence others, spawn stories of how great an iPhone with 5G is, and force competing smartphone players to accept 5G too. In two or three years, there’ll be a decent 5G phone population….
…. if we have service coverage in key markets, that is. Huawei is the 5G price leader, and its current troubles could mean that operators would have to pay more for 5G infrastructure, raising the risk by raising the “first cost”, the initial investment needed just to create credible coverage and thus promote customer adoption.
Intel’s departure from the 5G modem chip space isn’t a signal that 5G won’t happen, but rather that it won’t happen quickly. In order for 5G chips to take off, you’d need to see either a massive phone refresh, or widespread adoption of 5G-based IoT. We know that consumers aren’t likely to toss their phones just to get 5G, so that leaves IoT. Isn’t that IoT stuff on the verge of happening?
Probably, but not in the form of 5G devices. The great majority of IoT is in-building, where WiFi or other specialized control protocols work fine and offer connectivity at zero monthly cost. Connected car or autonomous vehicles don’t need 5G because despite the hype, nobody would seriously consider running vehicle control out-of-vehicle; there are too many things that could make control impossible and it’s too easy to use local intelligence to sense obstacles and take action. We have that already, right? Hey, gang, why would we be looking at distributing intelligence to the edge and at the same time remove it from cars?
How about augmented reality or virtual reality? We have that now as well. Many gamers use it, and it’s also based on WiFi today. Could you do better VR/AR with 5G? Certainly you could do it in more places, but while AR could theoretically be employed while driving or walking, the issues in delivering that are profound, and those in regulating it even more so. People do badly enough with texting while driving; imagine them with AR glasses on as they navigate through a busy intersection or pass a school that’s letting out.
Within a year or so, we’ll probably be hearing about how 5G was an epoch failure, how it didn’t happen as it should have, didn’t deliver what it could have. That’s not true. 5G is going to end up doing exactly what it should have been expected to do all along, which was an improvement in cellular bandwidth and cell capacity. It’s going to enable, facilitate, new applications, but each of those applications will have to prove their own business model and meet public policy and safety goals before they happen. They won’t spring up like weeds when they’re watered with the magic elixir of 5G.
Hype has no inertia, no limitations. Business and life do, and if we let ourselves build our expectations based on something with no practical boundary, we’re always going to be disappointed.