CTIA Commissioned Study Finds China Ahead of South Korea and U.S. in race to 5G
China has moved slightly ahead of both South Korea and the U.S. in the race to deploy 5G, according to a new report by Analysys Mason. The countries were ranked based on nations’ respective 5G spectrum and infrastructure policies as well as commercial plans by their respective wireless sectors.
China leads the world in 5G readiness, followed by South Korea, the U.S. and Japan in that order, according to the report, which was commissioned by CTIA-the U.S. based trade organization for the wireless industry.
Analysis Mason found that all three major Chinese wireless network operators (China Telecom, China Mobile, and China Unicom) have committed to specific 5G launch dates. The government has also committed to providing at least 100 MHz of mid-band spectrum and 2,000 MHz of high-band spectrum for each operator.
In South Korea, the government is soon expected to free up a combined 1300 MHz of both mid-band 3.5-GHz and high-band 28-GHz spectrum, with an additional 2 GHz of high-band spectrum capable of being utilized for 5G.
While all major US wireless providers are trialing 5G technologies and a number have committed to small-scale fixed wireless 5G launches by the end of the year, the country has yet to announce plan to allocate mid-band spectrum exclusively for mobile by the end of 2020.
“The United States will not get a second chance to win the global 5G race,” CTIA president and CEO Meredith Attwell Baker said.
“Today’s research highlights the importance of policymaker action in 2018 to reform local zoning rules and unlock access to mid-band spectrum as part of a broader spectrum pipeline plan. I’m optimistic we will leapfrog China because key leaders in the Administration, on Capitol Hill, and at the FCC are focused on the reforms needed to win the race.”
In Japan, wireless providers are investing in 5G testing and regulators have committed to releasing mid- and high-band spectrum by early 2019.
In evaluating the current status of the global race to 5G, Analysys Mason studied 5G spectrum and infrastructure policies as well the commercial industry plans of ten countries.
Key findings by Analysys Mason include:
- All major Chinese providers have committed to specific launch dates and the government has committed to at least 100 MHz of mid-band spectrum and 2,000 MHz of high-band spectrum for each wireless provider.
- Countries around the world are moving quickly to make spectrum available for 5G. This year alone, the U.K., Spain, and Italy are all holding 5G spectrum auctions.
- At the end of 2018, the U.S. will rank sixth out of the 10 countries in mid-band (3– 24GHz) spectrum availability, a critical band for 5G. The U.S. joins Russia and Canada as the only countries currently without announced plans to allocate mid-band spectrum on an exclusive basis to mobile by the end of 2020.
- Countries like the U.K. and regions like the European Union are taking significant steps to modernize infrastructure rules to facilitate the deployment of 5G networks.
To understand the potential impact the race to 5G may have on America’s economy, Recon Analytics conducted an historical analysis of how winning and losing wireless leadership effected the economies of the U.S. and other nations.
“When countries lose global leadership in a generation of wireless, jobs are shed and technology innovation gets exported overseas,” said Roger Entner, Founder, Recon Analytics. “Conversely, leading the world in wireless brings significant economic benefits, as the U.S. has seen with its 4G leadership. These are the serious stakes that face American policymakers in the escalating global race to 5G.”
Findings from Recon Analytics include:
- Winning the race to 4G boosted America’s GDP by nearly $100B and our 4G launch spurred an 84% increase in wireless-related jobs – benefits that could have gone to other countries had the U.S. not led the world in 4G.
- U.S. 4G leadership helped secure leading positions in key parts of the global wireless ecosystem, including the app economy.
- Losing wireless leadership had long-term negative effects on Japan and Europe, contributing to job losses and the contraction of their domestic wireless industries.
To highlight the implications of these reports, CTIA is hosting the Race to 5G Summit on Thursday, April 19 in Washington, D.C. The summit will bring together leading policymakers and technology and wireless industry executives involved in shaping America’s 5G future.
- Race to 5G Report: www.ctia.org/news/race-to-5g-report
- Race to 5G Facts and Figures: www.ctia.org/the-wireless-industry/the-race-to-5g
- Analysys Mason: Global Race to 5G – Spectrum and Infrastructure Plans and Priorities: www.ctia.org/news/global-race-to-5g-spectrum-and-infrastructure-plans-and-priorities
- Recon Analytics: How America’s 4G Leadership Propelled the U.S. Economy: www.ctia.org/news/how-americas-4g-leadership-propelled-the-u-s-economy
About the Analysys Mason Research
This research was commissioned by CTIA. Analysys Mason compared 5G spectrum and infrastructure policies proposed in markets worldwide to advance 5G technology and facilitate successful network deployment, and to prepare a readiness comparison between markets.
About Analysys Mason
Analysys Mason is a global consultancy and research firm specialising in telecoms, media and technology for more than 30 years. Our consulting and research expertise in telecoms, media and technology underpins everything we do to help change our clients’ businesses for the better. Since 1985, Analysys Mason’s consulting and analyst teams have played an influential role in key industry milestones and helping clients around the world through major shifts in the market. Our consulting and research divisions continue to be at the forefront of developments in digital services and transformation are advising clients on new business strategies to address disruptive technologies. Our experts located in offices around the world provide local perspective on global issues.
About the Recon Analytics Research
This research was commissioned by CTIA. This is the fifth report over the last thirteen years that Recon Analytics has authored on the impact of the wireless industry on the U.S. economy. Building on the same consistent framework, these reports have documented how the U.S. wireless industry has revolutionized society and the U.S. economy, relying on extensive primary and secondary research for these studies.
About Recon Analytics: The mission of Recon Analytics is to clear the clutter, help focus executives and policymakers on what is actually happening in the marketplace and what really matters, and make a positive impact on business and policy decisions. Founded and led by leading telecom analyst Roger Entner, Recon Analytics’ approach is bolstered by its industry-first executive advisory board, which helps us hone our strategy, improve our research, and provide unparalleled insights into the matters most relevant to the business and the public policies impacting it. With this foundation, Recon Analytics focuses on three core areas: Syndicated research, custom consulting, policy related data analysis, as well as white papers.
CTIA® (www.ctia.org) represents the U.S. wireless communications industry and the companies throughout the mobile ecosystem that enable Americans to lead a 21st century connected life. The association’s members include wireless carriers, device manufacturers, suppliers as well as apps and content companies. CTIA vigorously advocates at all levels of government for policies that foster continued wireless innovation and investment. The association also coordinates the industry’s voluntary best practices, hosts educational events that promote the wireless industry and co-produces the industry’s leading wireless tradeshow. CTIA was founded in 1984 and is based in Washington, D.C.
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5G will have no applications for European consumers over next 5 years – Freenet CEOThe 5G mobile standard is unlikely to have any importance for end customers in Europe for the foreseeable future, Freenet CEO Christoph Vilanek told German business publication Capital. Vilanek told Capital he doesn’t expect 5G to have any applications for end users over the next five years: people do not need 5G to make phone calls, while applications like video streaming are already possible with 3G and 4G.
Instead, the new mobile frequency standard will “essentially” be of importance for industrial applications thanks to the faster response times it offers for transmitting data, said Vilanek. Vilanek also warned that building up 5G networks will be “infinitely expensive” and cautioned that no one knows how these costs should be refinanced.
WSJ 9/8/2018: The 5G Race: China and U.S. Battle to Control World’s Fastest Wireless Internet
The early waves of mobile communications were largely driven by American and European companies. As the next era of 5G approaches, promising to again transform the way people use the internet, a battle is on to determine whether the U.S. or China will dominate.
Equipment makers and telecom operators in both countries are rushing to test and roll out the next generation of wireless networks, which will be as much as 100 times faster than the current 4G standard. Governments are involved as well—with China making the bigger push.
The new networks are expected to enable the steering of driverless cars and doctors to perform complex surgeries remotely. They could power connected appliances in the so-called Internet of Things, and virtual and augmented reality. Towers would beam high-speed internet to devices, reducing reliance on cables and Wi-Fi.
At the Shenzhen headquarters of Huawei Technologies Co., executives and researchers gathered in July to celebrate one of its technologies being named a critical part of 5G. The man who invented it, Turkish scientist Erdal Arikan, was greeted with thunderous applause. The win meant a stream of future royalties and leverage for the company—and it marked a milestone in China’s quest to dominate the technology.
At a Verizon Communications Inc. lab in Bedminster, N.J., recently, computer screens showed engineers how glare-resistant window coatings can interfere with delivering 5G’s superfast internet into homes. A model of a head known as Mrs. Head tested the audio quality of new wireless devices. Verizon began experimenting with 5G in 11 markets last year.
Nearby, in Murray Hill, N.J., Nokia Corp. engineers are testing a 5G-compatible sleeve that factory workers could wear like an arm brace during their shifts to steer drones or monitor their vital signs. The company began its 5G-related research in 2007.
While the economics of 5G are still being worked out, boosters say the potential payoffs are immense. Companies that own patents stand to make billions of dollars in royalties. Countries with the largest and most reliable networks will have a head start in developing the technologies enabled by faster speeds. The dominant equipment suppliers could give national intelligence agencies and militaries an advantage in spying on or disrupting rival countries’ networks.
“As we face the future, we know deep down that the birth of 5G standards represents a new beginning,” Huawei’s chairman, Eric Xu, told the audience at the company event.
Hans Vestberg, Verizon’s chief executive officer, speaks of the technology in equally dramatic terms. “We are strong believers that 5G [will have] a very transformative effect on many things in our society,” he said. “Consumer, media, entertainment…whole industries.”
By some measures, China is ahead. Since 2013, a government-led committee has worked with China’s mobile carriers and gear-makers on testing and development. The state-led approach, combined with an enormous domestic market, ensures that Chinese companies such as Huawei will sell large quantities of 5G equipment and gain valuable experience in the process.
In the U.S., where the government typically avoids mandating and coordinating efforts by the private sector, much of the experimentation has been led by companies such as AT&T Inc., Verizon, Samsung Electronics Co. and Nokia. Last week, tech companies including Intel Corp. and Cisco Systems Inc. argued in comments filed to the U.S. Trade Representative that proposed tariffs would raise the cost of routers, switches and other goods, slowing development of 5G.
Three of the major carriers plan to roll out 5G service in select cities later this year, though most mobile devices compatible with the new network won’t be ready until early 2019.
The race to 5G has come with tit-for-tat regulatory moves aimed at securing each country’s advantage. In March, the Trump administration blocked Singapore-based Broadcom’s acquisition of U.S. chip giant and 5G leader Qualcomm Inc., citing concerns that Broadcom would cut the company’s research and development funds and allow Chinese companies to pull ahead in 5G.
In July, China squelched Qualcomm’s planned acquisition of Dutch chip maker NXP Semiconductors NV, a deal that would have helped Qualcomm profit from 5G investments in new markets such as connected cars.
Much of the U.S. unease stems from the rising clout of Huawei, which was labeled a national-security threat, along with ZTE Corp. , by a Congressional panel in 2012 that said those firms’ equipment could be used for spying on Americans. In August, aligning itself with the U.S., Australia said it was banning Huawei and ZTE equipment from its 5G network. Other U.S. allies are studying similar bans.
Huawei and ZTE have consistently denied providing government agencies with backdoor access to their products. Beijing has likewise pushed to replace or sideline U.S. high-tech firms within China’s networks on fears of espionage.
China has made 5G a priority after failing to keep pace with Western countries in developing previous generations of mobile networks. The U.S. dominated 4G, built in the late 2000s, much in the same way Europeans controlled 3G standards. The American lead in 4G has been a boon to companies such as Apple Inc. and Qualcomm, and helped give rise to a host of consumer smartphone applications from the U.S.
Since 2015, China has built about 350,000 cell sites, compared with fewer than 30,000 in the U.S., according to an August study by consulting firm Deloitte. It also noted China has 14.1 sites for every 10,000 people, compared with 4.7 in the U.S. That matters for 5G, because the new networks will require much larger numbers of cell sites than 4G.
The physical manifestation of China’s push is a government-run 5G lab near the Great Wall north of Beijing. The sprawling facility is festooned with base stations and prototype mobile devices, with indoor and outdoor facilities for each of the major Chinese carriers and equipment makers, according to engineers and executives who have visited the site.
Trials are coordinated by a consortium of tech firms, universities and research institutes that operate under China’s Ministry of Industry and Information Technology. The group aims to wrap up tests by the end of the year.
After those trials conclude, state-run carrier China Mobile , the world’s largest mobile operator by subscribers, will follow up with its own tests in 17 cities, according to Chih-Lin I, a former Bell Labs researcher and the company’s chief scientist of mobile technologies. China’s 5G service is expected to be ready for commercial use by 2020.
The faster generation of networks relies on sophisticated technology that allows wireless airwaves to be used more efficiently. Plans call for it to run on high-frequency millimeter waves, which can handle more data but can’t travel as far as lower-frequency waves used by older networks. That means 5G will rely on clusters of antennae as well as decentralized data centers close to consumers and businesses—requiring big investments in infrastructure. The networks are expected to have the speed and responsiveness needed for advances such as driverless cars, which must instantaneously communicate with traffic signals, other cars and their surroundings.
China’s bid to steer the 5G future depends heavily on setting technical standards the rest of the world will have to follow—and pay royalties and licensing fees to use. It has played an aggressive role in the international telecom industry collective that sets global standards.
Experts inside and outside China expect Qualcomm and other Western firms to end up with a majority of the essential patents once the standards are fully determined, but China is making progress.
In 2009, as Huawei’s 5G push began, it recruited Tong Wen, a former senior researcher at now-defunct equipment maker Nortel Networks Corp., to set up a research lab in Ottawa. While flipping through an academic journal, Mr. Tong had stumbled on “polar coding,” a novel method for correcting errors in data transmission invented by Mr. Arikan, the Turkish scientist.
Huawei poured resources into developing it, and the government leaned on Chinese companies to vote for it en masse at a key standard-setting meeting at the Peppermill Resort in Reno, Nev., in 2016. The result was a tense fight that lasted past midnight with proponents of a rival technology favored by most Western firms, according to one standards expert who was there.
“The Chinese decided this was important,” the expert said. “This was one of the biggest political battles we’ve ever seen.”
The meeting ended with a compromise: Polar codes will be adopted for part of the standard, giving Huawei ownership of a critical patent. The company has spent more than $1 billion on 5G research and development so far.
The U.S. government has stopped short of mandating efforts by the private sector, opening the door to more diffuse outcomes determined by the work of individual companies. In January, a senior National Security Council official floated the idea of rivaling Beijing with a government-led effort to build a nationalized wireless network, but regulators and officials said it was too expensive and unrealistic.
Earlier this month, the Federal Communications Commission announced a plan to speed up the build-out of 5G networks by overriding some local rules and fees governing the deployment of small cellular transmitters, an important component of the infrastructure. The plan is expected to win approval in late September.
The government has funded some academic research that has paved the way for commercial technologies. One agency, the National Science Foundation, is coordinating an effort to build test beds for 5G and future generations of wireless networks.
“The United States is very much behind in this space” relative to Europe, South Korea, Japan and China, said a 2015 internal NSF report on 5G network development.
Thyaga Nandagopal—a former researcher at Bell Labs who is a director at the foundation—is leading the test bed project, in which companies, academics and government agencies will be able to test 5G and other wireless network applications in tandem. Nearly 30 U.S., European and Asian companies have committed $50 million of capital and equipment over the next seven years, while the U.S. government has pledged to invest another $50 million. In New York, an NSF-funded site run by academic institutions including Columbia University aims to launch a small pilot phase by the beginning of January.
Mr. Nandagopal said that China’s coordinated investments have put it in a “pretty good pole position” but that the NSF’s efforts are focused on wireless developments after 2020, rather than the early years of 5G deployment.
“We can invest our money strategically and still get better results than anyone else,” he said.
Some American telecom companies are staking claims to rooftops and light poles where they can position small cells that enable the faster networks, and pressing equipment and device makers to create 5G-compatible products.
For all the investment, industry experts note the standards for 5G aren’t fully written and wireless carriers are still figuring out how they can best profit from the service.
At a 5G forum in Santa Clara, Calif., in July, Henning Schulzrinne, a former chief technology officer at the FCC, said operators would also have to find a way to drastically reduce the cost of data to make applications such as augmented or virtual reality affordable enough to sell to consumers over 5G. Some of those applications could work using 4G or Wi-Fi instead.
“Who’s going to stream AR or VR if it’s going to cost them $10 per minute?” he said.
John Donovan, chief executive of AT&T’s communications business, said the company’s researchers have been among the most prolific writers of 5G standards, but it is being cautious as it puts the technology in the field.
“To deploy technology in advance of need, before the use cases are there—you’re wasting money,” he said.
Executives at Huawei have also sought to temper 5G expectations. Before an audience of analysts at an annual meeting at the Shenzhen headquarters in April, Mr. Xu, Huawei’s chairman, said that “the entire industry and also governments around the world have regarded 5G too high, to the extent that it’s going to be the digital infrastructure for everything.”
Huawei and China Mobile will push ahead with 5G on a large scale regardless, according to executives from both companies.
“5G is such an important strategic project for China—kitchen sink, all the resources,” said Edison Lee, a telecom analyst at investment bank Jefferies in Hong Kong. “Because if they get their foot in the door for 5G, they get their foot in the door of 6G, 7G, 8G.”
Financial Times reports: Huawei spat comes as China races ahead in 5G (on line subscription required)
A leaked memo, apparently written by a senior National Security Council official, revealed as far back as the start of this year exactly how worried the US is about Huawei. The rise of the Chinese company to become the world’s biggest supplier of telecoms equipment has given China a huge boost over the US in the race to introduce and develop 5G, the next generation of mobile communications, the memo complained.
“We are losing,” it said. “Whoever leads in technology and market share for 5G deployment will have a tremendous advantage towards [ . . .] commanding the heights of the information domain.”
Eleven months on, those fears have mushroomed into open conflict between Washington and Beijing, with American officials pushing allied countries to ban Huawei from building their 5G networks, citing concerns over security and the company’s unclear links to the Chinese state. The arrest and planned extradition to the US of Meng Wanzhou, Huawei’s chief financial officer and daughter to the company’s founder, has further exacerbated the spat.
Several countries have begun to trial 5G networks, though the full international standards have not yet been agreed. The shift to the new technology carries profound implications, and countries are wary of being left behind. 5G is “by no means simply a ‘faster 4G’”, the US memo said, describing it instead as “a change more like the invention of the Gutenberg Press”. It will bring higher speeds, lower lag times between network and device, and a much larger capacity to transfer data. Together, these features are expected to underpin self-driving cars, AI and machine-to-machine communications that will transform the way everything from homes to hospitals to factories operate.
U.S. Lags China in the Next Big Technological Advance in Cellphone Networks. Here’s Why it Doesn’t Matter
David H. Freedman, 10 May 2019 Newsweek Global Edition
Copyright © 2019 Newsweek LLC All Rights Reserved.
At the end of March, mobile phone carrier China Unicom broadcast a 360-degree, 3D view of the Chongqing International Marathon that put viewers smack in the middle of the 30,000-strong scrum of runners. The images were four times sharper than the highest-resolution content available from Netflix.
The live stream—billions of digital bits of data per second—was 20 times faster than current cellphone networks built with 4G technology can manage. China Unicom was demonstrating 5G technology, the next big leap for mobile networks, built by Huawei, the Chinese telecom giant that President Donald Trump loves to hate.
5G technology is arriving in the U.S. too—but not on networks built by Huawei, the world’s largest manufacturer of 5G network equipment. The White House is pushing hard to keep Huawei from grabbing an insurmountable lead in wiring up the world with 5G, which is expected to usher in a new technological age of driverless cars, smart objects, remote medical procedures, new forms of advertising and other things nobody has yet dreamed up. “The race to 5G is on, and America must win,” said Trump in mid-April. It’s no secret that he is focused on China, led by Huawei.
But which 5G race can the U.S. hope to win? There are really three different races: one to provide the equipment on which the new networks are built; one to roll out the services widely; and another to develop the whole package—the software, devices, services and business processes that take advantage of 5G’s blinding speed and near-instant responsiveness. The distinction is critical, because the U.S. has already lost the first race and may lose the second.
But the U.S. could still win the third race—and reap the main economic benefits of 5G. “The real race between the U.S. and China is to digitalize their economies,” says Bengt Nordstrom, CEO of international telecom consultancy Northstream in Stockholm. “The rest is hype.”
You won’t hear these distinctions in the Trump administration’s policies. The U.S. has already banned Chinese companies from building “essential” U.S. network infrastructure and threatened to ban Huawei components from all U.S. networks. The restrictions are pegged to suspicions that Huawei would give Chinese-government hackers “back doors” into its equipment.
Huawei denies any intent to build spyware, and there’s no public evidence it ever has. But many experts agree that Huawei-built networks pose a big security risk. “U.S. tech companies have the right to refuse to cooperate with government requests to spy, to sue if they’re being pressured and to disclose any spying to the media,” says Timothy Heath, a senior international defense researcher at the Rand Corp. in Washington, D.C. “Chinese companies don’t have those options. They’re obligated by law to be amenable to exploitation by the Chinese government.”
The Trump administration wields that argument to push the rest of the world into eschewing Huawei 5G equipment; it has threatened to sever intelligence ties with any nation that resists. So far that threat hasn’t stuck. German Chancellor Angela Merkel is defiant. British Prime Minister Theresa May gave an official thumbs-up to Huawei 5G equipment (except for certain critical components). Most of Asia, Africa and Latin America have welcomed Huawei with open arms. Only Australia and New Zealand have cooperated with the U.S.; Japan decided to ban Huawei on its own.
Huawei, already far ahead on the technology, is undercutting rivals on price. Its equipment costs as much as 40 percent less than Nokia’s and Ericsson’s—its only competitors—and neither company can match Huawei’s generous financing terms. Huawei’s market share is now more than Nokia’s and Ericsson’s combined. The U.S. isn’t even on the map: Not one U.S. company offers 5G network products or has announced plans to do so. And it’s too late anyway: The market would be saturated before a new entrant could get products out the door.
What about the race to build 5G networks? On the surface, the U.S. appears to be neck and neck with China and tech-savvy South Korea. Carriers in all three countries (plus one in Switzerland) claim to have introduced early 5G services to a limited number of mobile customers, and Japan is expected to launch 5G mobile service soon. But the U.S. networks, offered by Verizon in 22 cities, have been derided for spotty coverage. U.S. mobile carriers, hampered by the ban on Huawei, show no signs of offering nationwide 5G coverage before 2021.
China is a year or two ahead on a 5G network rollout, experts believe. “The Chinese government can mandate it as a priority, and it has the financial resources to make sure it succeeds,” says Gordon Smith, CEO of Sagent, a telecom company.
Once 5G networks are finally in place, however, the advantage is expected to shift. The U.S. maintains a strong lead in finding innovative ways to put Big Data to work for businesses and consumers, thanks both to tech giants like Google and Amazon, which spend billions on research, and a thriving tech-startup ecosystem. Leveraging 5G would create a digital world that reaches new levels of immersiveness, interactivity and realism and that is sensitive to every twitch of input from people and the environment. It would touch on video games and other entertainment; educational and advertising content; and the refrigerators, watches, buildings, store shelves and so on that cheaply zip sensor data to distant servers running artificial intelligence apps.
The economic impact of these services would be far more significant than building equipment and installing networks. The applications of 5G are expected to generate $4 trillion globally in the first two years alone, according to Wilson Chow, head of technology and telecommunications consulting at PwC China in Hong Kong. By contrast, the projected total worldwide market for installing 5G networks over four years is a mere $57 billion, according to industry research company IDC.
Perhaps more important, maintaining dominance in applications will allow the U.S. to remain the world’s leading technology influencer. “Think of what the U.S. gained economically, politically and militarily from being the first to master internet technologies and how China had to struggle to catch up,” says the Rand Corp.’s Heath. “5G is likely to play out in a similar way.”
If it does, Trump, should he still be president, may end up thanking China and Huawei for laying the pipes that made it possible.
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