Verizon earnings beat estimates despite COVID-19 impact; wireless revenues down; 2H-2020 Priorities

Verizon’s reported today that 2nd-quarter adjusted earnings per share was $1.18, ahead of analysts’ consensus estimate of $1.15, but down from $1.23 in the same period last year.  The company estimates that second-quarter 2020 EPS and adjusted EPS included approximately 14 cents of COVID-19-related net impacts, primarily driven by impacts to wireless service revenue and lower advertising and search revenue from Verizon Media.

Verizon added 173,000 wireless postpaid phone subscribers for the second quarter, as the COVID-19 pandemic weighed on wireless service and equipment revenue (see CFO Matt Ellis quote below).

Total wireless service revenue was down 1.7% from the same period a year ago, to $15.9 billion, while postpaid phone churn for Q2 was 0.51%. Verizon cited a significant drop in wireless equipment revenue because of low activations as the main driver behind a 4% drop in total consumer revenues to $21.1 billion and business to $7.5 billion.

Consumer wireless service revenue declined 2.7% from the year ago period to $13.1 billion. Business wireless revenue declined 3.7% YoY to $7.5 billion (see charts below).

Like AT&T, which reported earnings yesterday, Verizon said the results include impacts from reduced roaming and usage as travel remains restricted, and waived fees. However, Verizon said it had record uptake of its premium Unlimited plans by new accounts. Wireless postpaid average service revenue per account (ARPA) declined 1.8% to $116.02.

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Verizon continues to build-out its 5G network, with $9.9 billion in capital expenditures in the first half of the year. Those investments supported capacity and traffic growth across Verizon’s networks and included additional fiber and cell sites to expand its 5G UltraWideband rollout, which primarily uses 28 GHz millimeter wave spectrum. Verizon 5G network is in parts of 35 cities, while its fixed wireless 5G Home product is currently in six markets.

“Through extraordinary circumstances, Verizon delivered a strong operational performance in the second quarter,” said Verizon CEO Hans Vestberg in a statement. “We remain focused on our strategic direction as a technology leader, quickly adapting to the new environment and providing our customers with reliable and vital connections and technology services, while working to keep our employees safe and accelerating our 5G network deployment. We have embraced, engaged in and responded to important social movements happening throughout the world, and will continue to be at the forefront of initiatives that move the world forward for everyone. We are proud of what we have done, and continue to do, for our customers, shareholders, employees, and society.”

Other Q2 metrics for Verizon:

  • Total revenue of $30.4 billion, down 5.1%
  • Adjusted EBITDA of $11.5 billion and adjusted EBITDA margin of 37.9%
  • Earnings per share of $1.18, down 4.1%
  • Verizon Media revenues were down 24.5% to $1.4 billion

Commenting on the impact of COVID-19, Verizon Chief Financial Officer Matt Ellis told Barron’s Friday morning:

“Certainly this was a very different quarter than others, not part of our plan for the year, but when you look at the results I think you see strong operational performance and very good cash flow coming from that. I think it speaks to the nature of our business model and the importance of our products in our customers’ lives.”

Guidance and 2nd Half 2020 Priorities:

Verizon expects wireless revenue in a range of -1% to flat year over year in the 3rd quarter.  Capital spending is forecast to be in the range of $17.5 billion to $18.5 billion.

Stated 2nd half 2020 initiatives are:

  • 5G adoption
  • Network monetization
  • Next-gen B2B applications
  • Customer differentiation
  • New revenue opportunities

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“Regardless of how results match up against expectations for Verizon, these results should be seen as good compared to what AT&T reported yesterday,” wrote New Street Research analyst Jonathan Chaplin on Friday morning. This author certainly agrees, as Verizon is not encumbered by DirecTV and Warner Media as AT&T is.

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Quotes & Answers to Questions from Verizon’s July 24th Earnings Call Transcript:
CEO Hans Vestberg:

In February, we made some bold statements about our deployment on 5G in 2020 all the way from the Mobile Edge Compute, 5G Home cities, 5x more small cells on 5G and some 60 cities on the 5G Ultra-Wideband as well as a nationwide coverage on 5G with DSS. I’m happy to report we’re on track on that, and in some cases even ahead of the plan. We are continuing to deploy our technology.

Our test with DSS is going very well and as well, we have launched some of the 60 markets when it comes to mobility and some additional markets on 5G Home. However, you’re going to see that in the second half of this year we have a lot of new things happening and building on the foundation of the strategy and the strategic priorities that Verizon has outlined the last couple of years.

For Verizon Business Group, 5G Mobile Edge Compute, an important piece of our growth strategy, we have said that we are going to have 10 5G Mobile Edge Compute sites this year deployed. And now we’ve also started gearing up our partners. We have announced IBM and we also talked about SAP as two very important application providers that are going to take part of our deployment and that we’re collaborating with right now. So we’re creating a lot of excitement around the 5G Mobile Edge Compute and a lot more to come in the second half. Verizon Business Group, 5G Mobile Edge Compute, an important piece of our growth strategy, we have said that we are going to have 10 5G Mobile Edge Compute sites this year deployed. And now we’ve also started gearing up our partners. We have announced IBM and we also talked about SAP as two very important application providers that are going to take part of our deployment and that we’re collaborating with right now. So we’re creating a lot of excitement around the 5G Mobile Edge Compute and a lot more to come in the second half.

We are on plan to deploy more than 5x more millimeter wave base stations this year compared to last year, so the footprint will be much broader and we will be into 60 cities and those cities will be much more covered than they were last year. And we are disclosing that – usually on a fairly frequent basis how that map is growing. As you have seen, we have launched fairly few markets the first half when it comes to the 60, so you should expect quite a lot of noise from us in the second half and we’re really excited about that. But you also need to think about our model will also include nationwide, so think about our model being a millimeter wave that is transformative. No one is even close to it in the world. Then we will have national coverage on top of that. And then in the bottom, we have the best 4G network in the world. And then I don’t think that our customer will be disappointed with that. We build things that are transformative that are so different than others. So I would be excited for the second half if I would be you. It’s crunch time for Verizon. We have been talking about this for one and a half year. I think our customers will be very excited in the second half.

One year ago, we didn’t talk about DSS. But of course, our team was working to prepare all the networks so we can actually deploy DSS in all the radio base stations we have. So we constantly are ahead of the game thinking what is needed to be preparing for the network. But right now our focus is very much about the commitments we have to our customers when it comes to 5G, but also to keeping the best network on 4G. That’s where we’ll have it and then do that fiber reach. Those are the priorities and it will continue so. Then any speculation on the future spectrum or something, that’s a little bit early to have right now. But I can tell you my team is always proactively thinking about how to do this network continue to be the best in America. There’s no debate about that. And I have a high confidence that they will continue to do so when it comes to our CapEx allocation as well.

If you think about the Mobile Edge Compute, just last week we announced partnership with IBM and with SAP. That’s going to be part of the 5G Mobile Edge Compute in order to serve our customers. So you’re going to see that how we are doing, sort of laying out early indicators on that path to revenue that we have outlined both internally as well as externally.

5G Mobile Edge Compute. I think that the use cases we see today is very much real-time decision-making. If that’s a big distribution center that’s going to have 5G-enabled distribution center to actually take real-time decisions, or if it’s a big manufacturing plant that’s going to use 5G Mobile Edge Compute by wireless connecting to all the robotics, we’re in many of those cases. And then you also see cases where sort of IoT devices with 5G will actually enable a new way of delivering a service. And finally, the whole VR and AR for large enterprises where you need a low latency on the campus or in the manufacturing or whatever it might be, those are all the early cases. Many of them right now are based on low latency. We see it’s creeping into security because the data can then be contained with the company, meaning they can actually process and have all the processing and storage at the edge, which means they can keep the data for themselves. So those two capabilities are the first one. I think in the next, we’re going to see enormous bandwidth of enterprise that need to send a lot of data to the edge in order to take decisions. But so far, latency and security, that’s how the 5G Mobile Edge Compute scenarios are working out. And we basically have two, three – or two, I would say, per industry vertical that are lead customers for us. And we work with them to do the solutions and sometimes we are the third party as we don’t have all application ourselves. That’s how we’re working it right now and I’m encouraged. And, of course, as I said before, acceleration has been seen, because all the digitalization and touchless that is needed going forward.

We feel really good about our model. As we have said before, minimum of 10 5G Home cities. We’re going to have the cities with a much better chipset. That’s on plan for this second half.

And the self-install, which I have been talking about now for one and half year, which excites me that our customers should be able to receive the gear, the CPs and be able to install themselves in a short timeframe. It’s not that I’m down to the times that I have envisioned. I wanted to be below one hour, but we have come a far way from the eight hours we started with. And compared to a fiber installation where you need to first put it on the agenda, you wait for a couple of weeks and you have to come there and install it, and it takes hours to do. This is a totally different way. It’s transformative. As I said, we are building 5G that’s transformative, not the me-too to my 4G.

I think one thing that we have learned also is that, of course, fixed wireless access, we think a lot about consumers, but there is an opportunity clearly when you see this also as a fixed wireless access opportunity for small and medium business, et cetera, that we will start working on later on.

CFO Matt Ellis:

We’re driving these (5G Home) revenues off of the same (wireless) network that you are getting 5G mobility revenues on. So this is the first time we’ve had that opportunity to drive multiple revenue streams off of the same investment. And so as we roll out the network, we’ll have the opportunity to add more market share. And so we’re very excited about that as we head into ’21 with the progress we’re making this year.

We’re certainly excited about the opportunities that come with the C-band auction. One of the great things about having got the balance sheet in position that we have is it gives us the opportunity to take advantage of items like that when they come along. And I don’t think that – as I look at the balance sheet and I look at the auction that that will provide any inhibitor [ph] to us either in terms of what we do in the auction or how we invest in the rest of the business. In terms of the free cash flow, so the second quarter as you say, a couple of items in there. We had the tax benefit from the item that we recognized in the fourth quarter last year. We also had a timing difference of about $2 billion moving just regular cash payments from second quarter to last week. But all-in-all, look, our cash flow will continue to be strong because we have – obviously we have a strong business with a recurring revenue stream that will continue into the second half of the year. Working capital provided a benefit in the first half with the lower volumes. We’ll see how that plays out in the second half of the year. And I think that will be one of the key determinants of how cash flow looks for the full year on a year-over-year basis. So we’ll see how it plays out, but I certainly expect free cash flow to continue to be strong for the business.

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References:

 

AT&T Loses Subscribers, Revenues and Earnings drop due to COVID-19 Pandemic

AT&T suffered subscriber and revenue losses across the board in the spring quarter as the novel coronavirus infected every aspect of its business. Overall revenues sank to $41 billion, down 9% from $45 billion a year earlier, with the COVID-19 pandemic accounting for about $2.8 billion of that $4 billion hit.

On the wireless side of the business, which makes up more than half of revenues, AT&T shed 151,000 postpaid customers in Q2-2020, much worse than Wall Street’s consensus estimates of a 4,000-subscriber gain. That loss included 338,000 customers who stopped paying their bills but the company kept on the network to comply with the FCC’s Keep America Connected program. AT&T added 72,000 wireless postpaid subscribers in the year-ago period.

As a result, wireless revenues slipped to $17.1 billion in the quarter, down from $17.3 billion a year ago. But the company’s earnings before interest, taxes, depreciation and amortization (EBITDA) margin did edge up to 45.6% from 44.9% the year before.

AT&T’s shrinking traditional-TV business showed why the company needs its new online service to succeed. The division holding its DirecTV satellite unit lost 886,000 U.S. premium-TV subscribers and another 68,000 online-only channel bundles. That figure included 91,000 past-due accounts kept connected under the Keep Americans Connected pledge.

The U.S. TV unit ended June with 18.4 million accounts, down from more than 25 million two years ago. AT&T reported its traditional pay TV services, including DIRECTV and its newer streaming option AT&T TV, saw a combined net loss of 897,000 subscribers in the quarter. Meanwhile, its over-the-top streaming service, AT&T TV Now, also lost 138,000 subscribers, following a number of price hikes.  In addition, AT&T lost 68,000 streaming video subscribers. Due to that loss, its AT&T Now “skinny” bundle service closed the quarter with 720,000 subs, down 46% from a year earlier.

The company’s newer pay TV service, AT&T TV, only just became available nationwide in March. But despite its “streaming” nature — it ships with an Android TV-powered box to deliver TV over the internet — consumers may now have the opinion that it’s the worst of pay TV wrapped up in a new delivery mechanism. The streaming service is expensive compared with today’s over-the-top and video-on-demand options. It’s also laden with fees for things like activation, early termination and additional set-top boxes. And its bundle with AT&T Internet offers each service for $39.99/month for the first 12 months, but ties subscribers into two-year contracts where prices climb in the second year.

AT&T’s Q1 TV subscriber numbers indicate how quickly the pay TV market is imploding. And perhaps it will decline even more rapidly now that people no longer want to risk coronavirus exposure by having service techs install equipment in their homes. While AT&T TV’s DIY installation may help in that area, it’s unclear if the new service will ever broadly appeal to consumers in the streaming era.  AT&T ended the quarter with 18.6 million pay TV subscribers, down from 19.5 million in Q4 when it lost 945,000 subscribers. As a result, AT&T has now lost 3.9 million premium TV subs over the past 12 months, shrinking its customer base by 18%.

logo att share

Speaking on their earnings call Thursday morning, AT&T executives said they expect those numbers to improve in the third quarter as their retail stores gradually reopen throughout the U.S.  However, they also said some stores may not reopen or may close as they consolidate and streamline their retail outlets.

CapEx was $4.5 billion, with gross capital investment at around $5 billion, a difference primarily attributable to the timing of underpayments. AT&T invested an additional $1 billion in new 5G spectrum in the quarter, and invested nearly $400 million in HBO Max, in line with our full year estimate of $2 billion.

Even with the launch of HBO Max this spring, AT&T took its biggest financial hit on the media side of its business. Revenues at its WarnerMedia unit fell to $6.8 billion, down 23% from $8.8 billion last year, because of the absence of theatrical releases, lower TV ad sales and the lack of live sports. Company officials estimated that COVID-19 accounted for $1.5 billion of that decline.

Following what new AT&T CEO John Stankey termed “a flawless launch” of HBO Max, the supersized streaming video service that the company rolled out nationally in late May, the company reported that it closed out June with 36.3 million U.S. subscribers to HBO Max and HBO, up from 34.6 million subs at the end of last year. Citing “strong customer engagement” with HBO Max, Stankey said about 4.1 million customers have signed up so far, including about 1 million wholesale subscribers to AT&T.

AT&T reported an overall loss of 102,000 home broadband subscribers in the quarter, which included about 159,000 past-due accounts. The unit ended the quarter with 13.9 million connections, including DSL.   That broadband customer shrinkage came despite 225,000 AT&T Fiber net adds.   The latest AT&T broadband decrease marks the company’s fourth consecutive quarterly net loss of advanced broadband subscribers as it continues to fall further behind such big cable rivals as Comcast and Charter in the U.S. broadband market.

The telecom giant posted the overall broadband sub losses because it dropped 304,000 U-verse and other “advanced” broadband subscribers, according to the company’s latest earnings report. It also shed another 23,000 DSL subscribers as that business continues to wind down.

CFO John Stevens said on the earnings call:

Broadband customers continue to look for faster speeds. We added more than 220,000 AT&T Fiber subscribers, and a number of customers opting for gigabit speeds increased by more than 750,000 in the quarter. We now have 4.3 million AT&T Fiber customers, with nearly 2 million of them on 1 gigabit speeds.

On the broadband side, look, I have an appetite to get back to building footprint on fiber, and I think I’ve indicated that before. And I wouldn’t quite pigeon hole it in the way you asked the question relative to households. I have an appetite to build fiber that serves a combination of our needs in the consumer space, what we need to do to deploy 5G and what can help our business segment.

And really, the unique position we’re in as a business is we have lines of business in all those areas, and that should give us leverage in fiber deployment that I think others that are either only a fixed line provider and reselling wireless services or those that are only wireless providers and trying to deploy more fiber-intensive 5G networks don’t enjoy. And my investment thesis and my point of view on our company is that if we do our engineering correctly, and we think about our planning properly, we should be getting yields off of every millennial foot of fiber we put in that nobody else can achieve. And so as I think about this, and as we’re working them through from a planning perspective right now, it’s how we get the leverage across all 3 segments, not just the homes that we pass. Although, ideally, the net effect of that will be there will be communities that we build. I personally do not believe that 5G is a replacement in the near term for suburban, residential, single-family living units. It is an optimal strategy. I think it’s going to be a tough one to beat when there’s embedded gigabit-capable fixed line networks in place. And so I think there’s clearly going to be stuff on the margin that makes sense around that. But I don’t believe in the near term that 5G is the right fixed line replacement strategy in what I would call a typical single-family home infrastructure. And look, if it ultimately moves that way, and we start to see the technology stabilizing, we’re as well positioned as anybody to pivot to that. We certainly got the spectrum and the assets to make that happen; but I’m just not of the mindset right now that, that’s the optimal place to win in the market.

AT&T’s total broadband subscriber base is now shrinking by 3.3% on a year-over-year basis, according to the latest calculations by Craig Moffett, principal analyst at MoffettNathanson. In a report to investors today, he noted that this pace represents “another marked acceleration from the 2.8% decline” the company was experiencing just one quarter ago.Due to these accelerating subscriber losses, AT&T’s broadband financial metrics are clearly trending down as well.

“As with video, they had been pushing ARPU steadily higher, reflecting both mix as well as a clear intention to extract more cash from the business,” Moffett wrote in his report. But, he added: “Growth of just 1.6% YoY in premium broadband ARPU only (they don’t report DSL ARPU) wasn’t enough to offset the 2.5% YoY decline in subscribers; as with video, IP broadband revenue growth is now negative YoY.”

“HBO Max has gotten off to a rather inauspicious start,” Moffett added.

The company said it will continue investing in strategic growth areas like fiber, 5G, FirstNet, HBO Max.  Here are the company’s 2020 priorities:

Executing our plan with a market focus on:

• Wireless – Nationwide 5G and FirstNet
• Fiber-based connectivity – for wireless, consumer and business
• Software-based entertainment – HBO Max and AT&T TV
• Increased customer engagement – insights across all platforms’

AT&T withdrew its financial guidance due to the “lack of visibility related to COVID-19 pandemic and recovery,” the company said in a press release, which also stated:

“Our solid execution and focus in a challenging environment delivered significant progress in the quarter, most notably the successful launch of HBO Max, resilient free cash flow and a strengthened balance sheet,” said John Stankey, AT&T chief executive officer. “Our resilient cash from operations continues to support investments in growth areas, dividend payments and debt retirement. We are aggressively working opportunities to sharpen our focus, transform our operations and continue investing in growth areas, with the customer at the center of everything we do.”

“Our resilient cash from operations continues to support investments in growth areas, dividend payments and debt retirement. We are aggressively working opportunities to sharpen our focus, transform our operations and continue investing in growth areas, with the customer at the center of everything we do………I expect we’re going to be dealing with some of these economic challenges in a Covid environment” through the current quarter, Mr. Stankey said. “We’re operating accordingly,” he added.

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References:

https://investors.att.com/~/media/Files/A/ATT-IR/financial-reports/quarterly-earnings/2020/q2-2020/ATT%202Q20%20earnings%20release%20V2.pdf

https://investors.att.com/~/media/Files/A/ATT-IR/financial-reports/quarterly-earnings/2020/q2-2020/att-2q2020-earnings.pdf

https://www.lightreading.com/5g/covid-19-stings-atandt-despite-5g-hbo-max-rollouts/d/d-id/762618?

http://www.broadbandworldnews.com/author.asp?section_id=472&doc_id=762628&

AT&T Execs Talk up “Broadband Resiliency” and 5G with mixed impact from COVID-19

AT&T loses 897K more pay TV subscribers in Q1 2020, adding pressure to HBO Max launch

FCC CBRS Auction for 5G mid-band spectrum in the 3.5GHz band

The FCC’s Citizens Broadband Radio Systems (CBRS) auction is scheduled to start tomorrow, July 23, 2020.  271 qualified bidders are expected to bid for spectrum in what is referred to as the “5G mid-band.”

FCC Auction 105 will offer 22,631 Priority Access Licenses (PALs) in the 3550-3650 MHz portion of the 3.5 GHz band.

In 2015, the Commission adopted rules for shared commercial use of the 3550-3700 MHz band (3.5 GHz band). The Commission established the CBRS and created a three-tiered access and authorization framework to accommodate shared federal and non-federal use of the band. Rules governing the Citizens Broadband Radio Service are found in Part 96 of the FCC’s rules.

Access and operations will be managed by an automated frequency coordinator, known as a Spectrum Access System (SAS). When managing spectrum access, SASs may incorporate information from an Environmental Sensing Capability (ESC), a sensor network that detects transmissions from Department of Defense radar systems and transmits that information to the SAS. Both SASs and ESCs must be approved by the Commission. SASs will coordinate operations between and among users in three tiers of authorization in the 3.5 GHz band: Incumbent Access, Priority Access, and General Authorized Access.

Past sales offered licenses covering entire metropolitan areas at prices that only large carriers such as AT&T Inc. and Verizon Communications Inc. could afford. This one offers smaller licenses — seven in each county in the country for a total of 22,631. That means smaller telecoms, and other companies with new uses for the technology, can bid on spectrum rights in their local areas.

Mid-tier telecoms like Carolina West Wireless and Cincinnati Bell are on the list as well as electric co-ops like the Benton Rural Electric Association and the Illinois Electric Cooperative, Inside Towers reported. Several businesses and schools plan to bid, including: Deere & Company, Duke University and Health System, and the University of Kentucky. Utilities and electricity distributors could use their winnings to expand wireless broadband networks, manage electricity distribution, and install remote meter-reading.

“It’s really a game-changer for all of these non-traditional users,” said Kurt Schaubach, chief technology officer with Federated Wireless, a company based in Arlington, Virginia, that helps coordinate use of the spectrum being auctioned.

“We’ve never had an auction of this size,” FCC Commissioner Michael O’Rielly told Bloomberg. Auction winners can only buy four of the seven licenses available in each county, ensuring that no single user can get all of an area’s licenses. Each of the seven licenses provides rights to use the spectrum across an entire county.

A Raymond James analyst estimates the total value of the mid-band spectrum licenses at potentially $10 billion.

References:

https://insidetowers.com/cell-tower-news-bidding-starts-tomorrow-in-cbrs-auction/

https://www.fcc.gov/auction/105

Posted in 5G

TrendForce forecast: Chinese 5G smartphones to hold 4 of top 6 spots by production volume in 2020

Annual 5G smartphone production is expected to reach 235 million units in 2020, an 18.9 percent penetration rate, according to the latest research from TrendForce. Total smartphone production is forecast to reach 1.24 billion in 2020.

Ranked by production volume, Chinese brands are expected to account for 4 of the top 6 spots for 5G smartphone brands in 2020. Huawei tops the ranking, and is expected to produce around 74 million 5G smartphones in 2020. Apple is in 2nd place with a forecast yearly 5G smartphone production of around 70 million units. Samsung will be in 3rd place with production of 29 million 5G smartphones. They are followed by Chinese brands Vivo, Oppo and Xiaomi in 4th, 5th and 6th place with 5G smartphone production volumes of 21 million, 20 million and 19 million units respectively.

Note that this is a forecast, especially for Apple which has not yet announced a 5G smartphone.

Mid-to-low end 5G chipsets released by AP suppliers are expected to raise the penetration rate of 5G smartphones in 2021

TrendForce’s analysis of future developments in the 5G market shows that an aggressive push by mobile processor manufacturers will lead to the rapidly increasing presence of 5G chipsets in the mid-to-low end market, driving 5G smartphone production to surpass 500 million units in 2021, which will potentially account for about 40% of the total smartphone market. Once 5G chip prices reach a stable level this year, smartphone brands may look to gain additional shares in the 5G smartphone market by sacrificing gross margins. In doing so, they are likely to accelerate the drop of 5G smartphones’ retail prices, and the market may see the arrival of 5G smartphones around the RMB 1000 price level by the end of this year. Incidentally, it is worth noting that the penetration rate of 5G smartphones does not equal the usage rate of the 5G network, which depends on the progress of base station construction. Since the current 5G infrastructure build-out is pushed back as a result of the pandemic, the global 5G network coverage will be unlikely to surpass 50% before 2025 at the earliest, with complete coverage taking even longer.

Editor’s Questions:

In the absence of any true 5G standard, e.g. IMT-2020.SPECs, will any of these 5G smartphones work on a 5G network other than the one they are subscribed to?  Or will they fall back to 4G-LTE?  Will the 5G smartphones sold in 2020 be upgraded to comply with IMT-2020.SPECs and/or 3GPP Release 16 specs?

References:

http://www.trendforce.com/presscenter/news/20200722-10398.html

https://www.telecompaper.com/news/global-5g-smartphone-production-to-reach-235-million-in-2020-research–1347559

T-Mobile US: 5G SA Core network to be deployed 3Q-2020; cites 5G coverage advantage

Yet another wireless telco is moving to a 5G Stand Alone (SA) core network, without any standard or even specification (yes, we know about 3GPP TS 23.501 5G Systems Architecture spec in R15 and R16) in place.

In a blog post to assess the progress in the (new) T-Mobile US network four months after the Sprint acquisition, CTO Neville Ray wrote:

We’re also hard at work getting ready to light up standalone 5G this quarter, having recently completed the world’s first standalone 5G data session on a multi-vendor radio and core network, and the first standalone 5G data session of any kind in North America. Standalone 5G will expand our coverage and bring with it improved latency and faster uploads. It will also pave the way for applications that require real-time responses and massive connectivity such as mobile augmented and virtual reality, cloud gaming, smart factories and meters and even connected vehicles.

Analysis:

To the best of our knowledge, there are no 5G SA core networks deployed yet.  All the so called “5G” deployments are based on NSA or a LTE anchor via EPC.  With a rush of recent 5G SA core announcements, that will soon change

Yet it’s critical to note that ALL of the 5G core work is done in 3GPP– not in any SDO.  Moreover, ITU-T SG 13 which is responsible for IMT 2020 Non Radio Aspects recommendations has not received any of the 3GPP R16 documents.  And finally, URLLC for both the 5G radio access network and core are not yet complete as there has been no performance testing yet.  So how will “improved latency” be realized?

In the absence of any standard or detailed implementation spec, any 5G SA core network deployed within the next year (or longer) will be based on  a joint specification effort between the wireless network operator and its 5G core vendor (e.g. Huawei, Ericsson, Nokia, ZTE, possibly Cisco and NEC?).

Here’s what Dell-Oro had to say about 5G SA/5G Core:

During 2020, the industry will progress toward 5G SA. Lab proof-of-concepts and field trials are well underway around the world. Vendors and SPs are working together to learn about the intricacies of implementing 5G SA, which primarily means implementing the 5G Core for 5G NR base stations (a.k.a. Option 2). Some SPs will operate multiple 5G Cores dedicated to consumers, enterprise, public safety, and Internet of Things (IoT). They believe that dedicated 5G Core networks will be able to deliver new agile business solutions at a quicker pace for their respective user bases and more efficient network management.

The 3GPP release schedule is highlighted to emphasize that 5G, and especially the 5G Core standard (3GPP TS 23.501, the overarching specification), still has a long way to go before the full potential of 5G will be achieved. While the industry has been touting 5G for several years, it cannot be realized without the 5G Core.

The 5G Core is known as a Service-Based Architecture (SBA). At a high level, it consists of the User Plane, the Control Plane, and the Shared Data Layer Network Functions. This enables a more resilient core network (CN). Hardware and software disaggregation creates what is known as stateless Virtual Network Functions (VNFs) that run on COTS Network Function Virtualization Infrastructure (NFVi). If a hardware failure occurs, a new virtual machine (VM) or Container can spin up on a new server without loss of data because it resides in the Shared Data Layer.

This structure allows for Cloud computing with container-based Cloud-Native Network Functions (CNFs) that permit microservices tailor-made for smaller groups of subscribers. CNFs enable SPs to build a web-scale core with greater degrees of orchestration and automation to bring new services to the market in a few hours or days, as compared to months or years.

More specifically,  TS 23.501 -Release 16 provides guidelines for 5G Core virtualized deployments, but does not specify how to implement any of those deployments.  Here’s the relevant text:

5.21.0 General

5GC supports different virtualized deployment scenarios, including but not limited to the options below:

A Network Function instance can be deployed as distributed, redundant, stateless, and scalable NF instance that provides the services from several locations and several execution instances in each location.

– This type of deployments would typically not require support for addition or removal of NF instances for redundancy and scalability. In the case of an AMF this deployment option may use enablers like, addition of TNLA, removal of TNLA, TNLA release and rebinding of NGAP UE association to a new TNLA to the same AMF.

A Network Function instance can also be deployed such that several network function instances are present within a NF set provide distributed, redundant, stateless and scalability together as a set of NF instances.

– This type of deployments may support for addition or removal of NF instances for redundancy and scalability. In the case of an AMF this deployment option may use enablers like, addition of AMFs and TNLAs, removal of AMFs and TNLAs, TNLA release and rebinding of NGAP UE associations to a new TNLA to different AMFs in the same AMF set.

– The SEPP, although not a Network Function instance, can also be deployed distributed, redundant, stateless, and scalable.

– The SCP, although not a Network Function instance, can also be deployed distributed, redundant, and scalable.

Also, deployments taking advantage of only some or any combination of concepts from each of the above options is possible.

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Other T-Mo Highlights:

Ray referred to recent analysis from OpenSignal and Ookla on T-Mobile US’ 5G network availability. T-Mo’s reliance on far-reaching 600 MHz spectrum for its “5G foundation,” assures that its 5G footprint significantly outstrips the other national carriers’ 5G coverage areas.  Ray wrote:

new report from Opensignal ranks the T-Mobile network first for 5G availability, meaning Un-carrier customers get a 5G signal more often than customers on any other network – more than twice as often as AT&T and 56 times more often than Verizon! Plus, a new report from Ookla measuring 4G and 5G from over one million customer devices shows that T-Mobile has 5G in nearly 4X more cities than Verizon and AT&T (and 32X more cities than Verizon alone). And T-Mobile customers with a 5G-capable device experience faster overall download and upload speeds than Verizon customers.  And look at the Verizon availability score – yep – no typo here – that’s 0.4%…..

Verizon in particular relied on millimeter wave for its initial deployments, and AT&T has moved to a mix of high- and low-band 5G deployments. Verizon expects to be able to dramatically expand its 5G coverage via the use of Dynamic Spectrum Sharing later this year.

T-Mo’s 5G Spectrum holdings are depicted in this graphic (courtesy of T-Mobile US):

 

 

T-Mobile USA 5G Spectrum Holdings

Image Credit: T-Mobile USA

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Regarding 5G speeds, low-band 5G performance tends to look pretty similar to 4G, while mmWave-based 5G is spotty but speedy. Post-Sprint merger, T-Mo is leveraging Sprint’s mid-band spectrum holdings to boost its 5G speed performance and also utilizes mmWave in some urban areas, per its “layer cake” 5G spectrum strategy as per the above graphic.

Ray said in his blog post that T-Mobile US is “rapidly deploying critical mid-band 2.5 GHz spectrum from Sprint” to increase capacity and speed, and announced that mid-band 5G from T-Mo is now live in parts of Chicago, Illinois; Houston, Texas; and Los Angeles, California.

Ray said that mid-band 5G testing is showing average download speeds of more than 300 Mbps and peak speeds of 1200 Mbps. T-Mobile US has also tested the reach of its low-band 5G, recently completing tests with Ericsson, Qualcomm and OnePlus that demonstrated a 5G connection reaching 60 miles from the base station (on 600 MHz).

The T-Mo exec also said that the carrier’s 600 MHz spectrum is finally repacked and cleared of broadcasters, a little more than three years after being auctioned. Virginia Beach, Norfolk and Richmond, Va., Topeka, Kan., Sussex County, Del., and coming soon in Buffalo, N.Y.

Related to the carrier’s commitments to the Federal Communications Commission as part of the merger with Sprint, Ray said that T-Mo is moving ahead with the expansion of its wireless broadband internet service pilot. In Grand Rapids, Michigan, the carrier has started offering the service to people who aren’t existing T-Mobile US customers. Ray noted that the carrier plans to offer T-Mobile Home Internet in more than 50% of all U.S. zip codes.

References:

https://www.t-mobile.com/news/network/accelerating-5gforall

T-Mo plans to turn up SA 5G this quarter

5G Core – Are We Ready?

Posted in 5G

Reliance Jio claim: Complete 5G solution from scratch with 100% home grown technologies

Indian wireless upstart Reliance Jio has developed its own 5G solution “from scratch,” according to Jio Chairman Mukesh Ambani (India’s richest man). The company plans to launch “a world-class 5G service in India…using 100% home grown technologies and solutions,” he said in a statement at the Reliance Industries annual shareholders meeting.  “Once Jio’s 5G solution is proven at India-scale, Jio Platforms would be well-positioned to be an exporter of 5G solutions to other telecom operators globally, as a complete managed service,” he added.

–>Please see references 1. and 2. below for video clips of Ambani’s speech.

The company’s equipment is ready for deployment this year, as soon as 5G spectrum is available, Ambani said (more details below). A roll-out will be relatively easy, thanks to its existing all-IP 4G network, according to Ambani.

The development supports the India government’s local production push, to develop home-grown alternatives to technology from China (Huawei, ZTE), Ericsson, Nokia, Samsung, etc.  Ambani did not outline the exact components developed, but he said the company would look to export the 5G system to other countries as well.

Nor did he comment on India’s IMT 2020 Low Mobility Large Cell (LMLC) submission from TSDSI which is moving forward as a 5G Radio Interface Technology (RIT) that will be standardized by ITU-R in IMT-2020.SPECS late this year.

The regulatory environment for Jio has been incredibly benign for its entire existence, from being given a special national license to the crippling historical license fees being imposed on its competitors. As a result Jio now sees itself as the world’s first ‘super operator’ and it seems to have the full backing of the Indian state in that ambition.

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The Business Standard reports that Jio has applied to the Department of Telecom for trial 5G spectrum. The company is reportedly seeking 800 MHz in the mmWave bands 26 and 24 GHz and 100 MHz in the 3.5 GHz band for field trials of its new network in a few metro areas.

If Jio really does have 5G Radio and Core technology, it will be in competition with global wireless network infrastructure giants, such as Huawei, ZTE, Ericsson, Nokia, and Samsung, which dominate the global wireless telecom market.

According to India Department of Telecom (DOT) sources, Jio has said its 5G network solution is ready and it can start trials immediately after spectrum is allocated. It has also revealed that it took the company three years and a few hundred engineers to turn this dream into reality.  DOT sources say that, in a communication on July 17th, Jio made a strong pitch for spectrum in the mmwave band, arguing that countries like the US, South Korea, Japan, and Canada are veering towards preference of the 28- GHZ band for 5G deployment, while others like Australia, the UK, and European countries want to be in the 26- GHZ band.

Jio’s reasoning is that, given its plans to offer its 5G products in the global market, it is essential for it to have trial runs of the technology on these crucial frequency bands. It plans to test and successfully deploy the 5G technology on its own network, after which it can be sold overseas to other wireless telcos.

Moreover, it would like to test the technology in dense urban environments in India.  Once it has proved itself there, it’s likely to work well in large big cities overseas.

As a result, Jio has requested that 800 MHZ of spectrum be assigned to it in 26.5–29.5 GHZ and 24.25-27.5 GHZ in the mmWave bands.  It has also asked for 100 MHZ in the 3.5- GHZ mid spectrum band.

The government’s upcoming auction process is expected to kick-start by August, but it might be limited to only 4G spectrum. The Telecom Regulatory Authority of India has currently given its recommendation for the base price of spectrum in the 3.5-GHZ band for 5G auctions and not for mmwave bands. The DOT is expected to inform the regulator soon about the pricing of the mmwave bands for auction.

The Jio announcement comes at a time when Chinese telecom gear makers Huawei and ZTE face serious challenges, with numerous countries banning the use of their 5G equipment which they allege is, or can be, used by China to spy on them. Samsung is one player that is overly dependent on Jio as it is Jio’s largest client for 4G telecom gear and had earlier applied to the government to undertake 5G trial runs together. Jio’s 5G technology is based on a ‘virtualised 5G network’, which will ensure the current hardware-dependent networks shift to software-centric platforms.

This poses a challenge to current networks, which are based on proprietary technology, where both the hardware and software have to be bought from the same vendor, who then maintains and upgrades the system, leaving operators with limited flexibility.

The new networks being developed will be built on open platforms, so that operators will have the choice of buying hardware or software separately from different vendors or even building the latter on their own on an open platform. They could also ally with information technology companies to undertake system integration between the hardware and software and run the networks.

Apart from flexibility, this will bring down network costs substantially for 5G. According to cloud-native network software provider Mavenir, the new virtualized networks would lead to a saving of 40 per cent in capital expenditure and 34 per cent in terms of lower operations cost for operators.

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References:

 

https://www.pressreader.com/india/business-standard/20200720/281573768006663

https://economictimes.indiatimes.com/industry/telecom/telecom-news/reliance-jio-seeks-spectrum-for-5g-trials-plans-to-sell-tech-overseas/articleshow/77072725.cms

https://telecoms.com/505654/jio-lobbies-for-a-head-start-on-its-5g-network/

Barracuda CloudGen SD-WAN runs on Microsoft Azure Virtual WAN Hubs; 5G Next Target for CSPs?

In the new world of cloud service providers (CSPs) taking over every aspect of communications, Microsoft Azure will now be used as the basis of what Barracuda calls “the first SD-WAN service built natively inside Azure Virtual WAN Hubs.”  Those so called “hubs” are interconnected through Microsoft’s Global Network.

The new Barracuda CloudGen SD-WAN is a SaaS  deployed directly from the Azure Marketplace for as many regions as needed and administered centrally in the CloudGen WAN portal for all office locations and remote endpoints. Since the Microsoft Global Network is automatically provisioned as the backbone for anywhere, anytime application access, service providers can create a pragmatic SASE platform in the public cloud tailored to their specific needs.

Virtual WAN diagram

Illustration of Azure Virtual WAN from Microsoft (see reference below)

Microsoft says its Virtual WAN offers the following advantages:

  • Integrated connectivity solutions in hub and spoke: Automate site-to-site configuration and connectivity between on-premises sites and an Azure hub.
  • Automated spoke setup and configuration: Connect your virtual networks and workloads to the Azure hub seamlessly.
  • Intuitive troubleshooting: You can see the end-to-end flow within Azure, and then use this information to take required actions.

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Barracuda said that their CloudGen WAN architecture can replace costly, inflexible network connectivity circuits, and the entire network can be dynamically sized to match current traffic workload, which can optimize network performance and minimize cost.

“A cloud-first strategy asks for a different approach on connectivity,” said Leon Sevriens, program manager, IT at Humankind, a large organization in the Netherlands that offers daycare and after-school care, with over 3,000 employees and over 450 locations. “We have invested heavily in Microsoft Office 365 adoption across the organization, and traditional connectivity doesn’t fit the bill anymore. We need a solution that is focused on delivering application performance, not just ‘plain’ connectivity. That’s why we’re moving forward with Barracuda CloudGen WAN,” he added.

In the recent report “Secure SD-WAN: The Launch Pad into Cloud,” Barracuda found that SD-WAN is being used by more than half of those who have added security to their public cloud. As the report explains, “SD-WAN can help overcome the top two security challenges organizations are facing when it comes to public cloud: lack of access control and backhauling traffic.”

Cloud-native, secure SD-WAN:

The perimeter is changing, and organizations need to be ready to adapt. According to Gartner, “The enterprise perimeter is no longer a location; it is a set of dynamic edge capabilities delivered when needed as a service from the cloud.”1

Secure SD-WAN services built natively on the cloud combine ease of use, full security, and cloud-scalable SD-WAN connectivity to use the Microsoft Global Network as the WAN backbone instead of leased lines. The new Barracuda CloudGen WAN is a SaaS service deployed directly from the Azure Marketplace for as many regions as needed and administered centrally in the CloudGen WAN portal for all office locations and remote endpoints. Since the Microsoft Global Network is automatically provisioned as the backbone for anywhere, anytime application access, service providers can create a pragmatic SASE solution in the public cloud tailored to their specific needs.

“With an all-in-one, secure SD-WAN solution natively built on the public cloud network, enterprises can finally make the shift to more public cloud deployments, both faster and more securely,” said Hatem Naguib, COO at Barracuda. “We appreciate the relationship we have developed with Microsoft over the years and the close collaboration over many months to integrate Barracuda SD-WAN technology natively on Microsoft Azure Virtual WAN Hubs. We know this is the future of networking in the public cloud, and we’re excited to be on this forefront with Microsoft.”

Yousef Khalidi, Corporate Vice President, Azure Networking at Microsoft said, “Cloud-native, secure SD-WAN technology, like the new CloudGen WAN service from Barracuda, provides a fast, reliable, and direct path to Microsoft Azure. We’re pleased to collaborate with Barracuda for this new wave of faster public cloud adoption to help our joint customers optimize network performance.”

Opinion: The huge implication here is that the major cloud service providers (Amazon AWS, Microsoft Azure and Google Cloud) will be replacing traditional telco networks.  In this case, it’s SD-WAN access and Microsoft’s WAN backbone, but in the future it will likely be 5G network access built mostly from software building blocks.  Why else did Microsoft acquire Affirmed Networks and Metaswitch?

For an Amazon AWS executive’s take on this topic (“we’re partners with telco’s”) read this Light Reading piece.

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References:

https://www.prnewswire.com/news-releases/barracuda-introduces-first-global-secure-sd-wan-service-built-natively-on-microsoft-azure-301094835.html

https://docs.microsoft.com/en-us/azure/virtual-wan/virtual-wan-about

Will Hyperscale Cloud Companies (e.g. Google) Control the Internet’s Backbone?

Resources from Barracuda:

For more information about Barracuda CloudGen WAN, visit https://www.barracuda.com/products/cloudgenwan

Read the Barracuda blog post: http://cuda.co/40855

Read the Microsoft blog post from Yousef Khalidihttps://aka.ms/vwan-sdwan

Watch Reshmi Yandapalli’s session on “Use Azure networking services to accelerate, scale or re-architect your customer’s global network” for Microsoft Inspire: https://aka.ms/T4D193

Read the market report: https://www.barracuda.com/sdwan-report-2020

Find out Barracuda was recognized as a finalist for Commercial Marketplace 2020 Microsoft Partner of the Year: http://cuda.co/40853

1 Gartner, “The Future of Network Security Is in the Cloud”, Neil MacDonald, Lawrence Orans, Joe Skorupa30 August 2019.

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Tutorial on Advanced Antenna Systems (AAS) for 5G Networks

Editor’s Note:

ITU-R (Rec. ITU‑R M.2101) uses the term AAS to mean Advanced Antenna System(s), while 3GPP uses the term AAS to mean Active Antenna System (s).

Definition:

Advanced antenna systems (AAS) is the general term used to describe antenna systems utilizing techniques aiming at improving performance and spectral efficiency of radiocommunication transceivers taking advantage of antenna array theory and practice.

These techniques include adaptive beamforming, multiple input multiple output (MIMO), and space division multiple access (SDMA) among other ones. These multi-antenna techniques are generally applicable to any frequency band or radio application and can be implemented using passive or active antennas.

In higher frequency bands, such as those around the millimetric wave bands, active advanced antenna systems are the prevalent technology choice.

  • Smart antennas
  • Adaptive beamforming
  • Phased arrays
  • Spatial multiplexing and MIMO
  • Space Division Multiple Access (SDMA)
  • Active and passive antennas
  • Antenna Array Theory

Basic concepts:

Multiple antennas can be arranged in space in specific configurations to form a highly directive pattern. These arrangements are referred to as “arrays.”  In an array antenna, the fields from the individual elements add constructively in some directions and destructively (cancel) in others thus creating an overall array radiation pattern different from that of the individual elements.

The major advantage of antenna arrays over a single antenna element is their electronic scanning capability; that is, the major lobe can be steered toward any direction by changing the phase of the excitation current at each array element (phased array antennas). Furthermore, by also controlling the magnitude of the excitation current, a large variety of radiation patterns and sidelobe level characteristics can be produced. Adaptive antennas (also called “smart antennas” in mobile communication applications) go a step further than phased arrays and can direct their main lobe (with increased gain) in a desired direction (e.g., a mobile user in a cellular communication system) and nulls in the directions of interference or jammers.

AAS enables state-of-the-art beamforming and MIMO techniques that are powerful tools for improving end-user experience, capacity and coverage. As a result, AAS significantly enhances network performance in both uplink and downlink. Finding the most suitable AAS variants to achieve performance gains and cost efficiency in a specific network deployment requires an understanding of the characteristics of both AAS and of multi-antenna features.

Multi-antenna techniques

Multi-antenna techniques, here referred to as AAS features, include beamforming and MIMO. Such features are already used with conventional systems in today’s LTE networks. Applying AAS features to an AAS radio results in significant performance gains because of the higher degrees of freedom provided by the larger number of radio chains, also referred to as Massive MIMO.

Beamforming

When transmitting, beamforming is the ability to direct radio energy through the radio channel toward a specific receiver, as shown in the top left quadrant of Figure 1. By adjusting the phase and amplitude of the transmitted signals, constructive addition of the corresponding signals at the UE receiver can be achieved, which increases the received signal strength and thus the end-user throughput. Similarly, when receiving, beamforming is the ability to collect the signal energy from a specific transmitter. The beams formed by an AAS are constantly adapted to the surroundings to give high performance in both UL and DL.

Figure 1: Beamforming and MIMO, with the different colors of the filled beams representing streams.

Although often very effective, transmitting energy in only one direction does not always provide an optimum solution. In multi-path scenarios, where the radio channel comprises multiple propagation paths from transmitter to receiver through diffraction around corners and reflections against buildings or other objects, it is beneficial to send the same data stream in several different paths (direction and/or polarization) with phases and amplitudes controlled in a way that they add constructively at the receiver [5]. This is referred to as generalized beamforming, as shown in the upper right quadrant of Figure 1. As part of generalized beamforming, it is also possible to reduce interference to other UEs, which is known as null forming. This is achieved by controlling the transmitted signals in a way that they cancel each other out at the interfered UEs.

MIMO (Multiple Input, Multiple Output) techniques:

Spatial multiplexing, here referred to as MIMO, is the ability to transmit multiple data streams, using the same time and frequency resource, where each data stream can be beamformed. The purpose of MIMO is to increase throughput. MIMO builds on the basic principle that when the received signal quality is high, it is better to receive multiple streams of data with reduced power per stream, than one stream with full power. The potential is large when the received signal quality is high and the streams do not interfere with each other. The potential diminishes when the mutual interference between streams increases. MIMO works in both UL and DL, but for simplicity the description below will be based on the DL.

Single-user MIMO (SU-MIMO) is the ability to transmit one or multiple data streams, called layers, from one transmitting array to a single user. SU-MIMO can thereby increase the throughput for that user and increase the capacity of the network. The number of layers that can be supported, called the rank, depends on the radio channel. To distinguish between DL layers, a UE needs to have at least as many receiver antennas as there are layers.

SU-MIMO can be achieved by sending different layers on different polarizations in the same direction. SU-MIMO can also be achieved in a multi path environment, where there are many radio propagation paths of similar strength between the AAS and the UE, by sending different layers on different propagation paths, as shown in the bottom left quadrant of Figure 1.

In multi-user MIMO (MU-MIMO), which is shown in the bottom right quadrant of Figure 1, the AAS simultaneously sends different layers in separate beams to different users using the same time and frequency resource, thereby increasing the network capacity. In order to use MU-MIMO, the system needs to find two or more users that need to transmit or receive data at the very same time. Also, for efficient MU-MIMO, the interference between the users should be kept low. This can be achieved by using generalized beamforming with null forming such that when a layer is sent to one user, nulls are formed in the directions of the other simultaneous users.

The achievable capacity gains from MU-MIMO depend on receiving each layer with good signal-to-interference-and-noise-ratio (SINR). As with SU-MIMO, the total DL power is shared between the different layers, and therefore the power (and thus SINR) for each user is reduced as the number of simultaneous MU-MIMO users increases. Also, as the number of users grows, the SINR will further deteriorate due to mutual interference between the users. Therefore, the network capacity typically improves as the number of MIMO layers increases, to a point at which power sharing and interference between users result in diminishing gains, and eventually also losses.

It should be noted that the practical benefits of many layers in MU-MIMO are limited by the fact that, in today’s real networks, even with a high number of simultaneous connected users, there tends not to be many users who want to receive data simultaneously. This is due to the bursty (chatty) nature of data transmission to most users. Since the AAS and the transport network must be dimensioned for the maximum number of layers, the MNO needs to consider how many layers are required in their networks. In typical MBB deployments with the current 64T64R AAS variants, the vast majority of the DL and UL capacity gains can be achieved with up to 8 layers.

References:

https://www.5gamericas.org/wp-content/uploads/2019/08/5G-Americas_Advanced-Antenna-Systems-for-5G-White-Paper.pdf

https://www.ericsson.com/en/reports-and-papers/white-papers/advanced-antenna-systems-for-5g-networks

IBM and Verizon Business Collaborate on 5G, Edge Computing and AI Solutions for Enterprise Customers

Verizon Business and IBM are working together on 5G and edge computing innovation to help enable the future of “Industry 4.0.” The two companies plan to combine the high speed and (yet to be proven) low latency of Verizon’s 5G and Multi-access Edge Compute (MEC) functionalities, IoT devices and sensors at the edge, and IBM’s expertise in AI, hybrid multi-cloud, edge computing, asset management and connected operations.  These will be jointly offered with IBM’s Maximo Monitor with IBM Watson and advanced analytics. The combined products may help clients detect, locate, diagnose and respond to system anomalies, monitor asset health and help predict failures in near real-time. The first solutions to be aimed at helping improve industrial quality, availability and performance.

“Through this collaboration, we plan to build upon our longstanding relationship with Verizon to help industrial enterprises capitalize on joint solutions that are designed to be multi-cloud ready, secured and scalable, from the data center all the way out to the enterprise edge,” IBM’s Bob Lord, SVP of cognitive applications, blockchain and ecosystems, said in a press release from the companies.

“Through this collaboration, we plan to build upon our longstanding relationship with Verizon to help industrial enterprises capitalize on joint solutions that are designed to be multi-cloud ready, secured and scalable, from the data center all the way out to the enterprise edge.”

“This collaboration is all about enabling the future of industry in the Fourth Industrial Revolution,” said Tami Erwin, CEO, Verizon Business. “Combining the high speed and low latency of Verizon’s 5G UWB Network and MEC capabilities with IBM’s expertise in enterprise-grade AI and production automation can provide industrial innovation on a massive scale and can help companies increase automation, minimize waste, lower costs, and offer their own clients a better response time and customer experience.”

5G Network Internet Mobile Wireless Business concept.5G standard of modern signal transmission technology.

              Image Credit: iStockphoto/LHG

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IBM and Verizon said their first offerings would target “mobile asset tracking and management solutions,” and that, eventually, they hope to offer products for remote control robotics, real-time video analysis and plant automation.  The two companies also plan to collaborate on potential joint solutions to address worker safety, predictive maintenance, product quality and production automation.

Many industrial enterprises are today seeking ways to use edge computing to accelerate access to near real-time, actionable insights into operations to improve productivity and reduce costs.  To address industrial firms’ need for edge computing ways to accelerate access to near real-time insights into operations, the first products planned from this collaboration are mobile asset tracking and management products to help enterprises improve operations, optimise production quality, and help clients enhance worker safety.

IBM and Verizon are also working on potential combined products for 5G and MEC-enabled use cases such as near real-time cognitive automation for the industrial environment.

Verizon and IBM also plan to collaborate on potential joint products to address worker safety, predictive maintenance, product quality and production automation.

Light Reading’s Mike Dano had this comment:

For IBM, the announcement underscores its efforts to offer products and services in the edge computing marketplace, an area that’s becoming a key focus for a variety of businesses looking for speedy computing services via nearby or onsite facilities.

And for Verizon, the announcement adds further momentum to its 5G and edge computing ambitions. Company executives have long argued that the combination of 5G and edge computing has a wide range of enterprise applications, and Verizon’s new pairing with IBM could open the doors to more potential customers for such services.

To be clear, Verizon has been working to stamp out a position in the 5G and edge computing sector for years. The company hopes to offer its high-speed, millimeter-wave 5G network across 60 cities by the end of this year, and concurrently it has said it will launch nationwide 5G on lowband spectrum in that same timeframe. Separately, Verizon late last year announced it would team up with Amazon to support its AWS edge computing initiative.

But Verizon’s edge computing efforts don’t stop there. The company joined América Móvil, KT, Rogers, Telstra and Vodafone to establish the “5G Future Forum” in January in part to accelerate the development of Multi-access Edge Computing (MEC)-enabled solutions. The group this week announced it will release its first technical specifications in the third quarter.

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References:

https://newsroom.ibm.com/2020-07-16-IBM-and-Verizon-Business-to-Collaborate-on-5G-and-AI-Solutions-at-the-Enterprise-Edge

https://www.lightreading.com/the-edge/verizon-ibm-team-up-on-5g-and-edge-computing/d/d-id/762452?

https://www.telecompaper.com/news/ibm-verizon-business-to-collaborate-on-5g-ai-products-at-enterprise-edge–1346836

https://www.techrepublic.com/article/ibm-and-verizon-business-collaborate-to-merge-ai-computing-with-5g-networks-for-the-enterprise/

Executive Summary: IMT-2020.SPECS defined, submission status (?), and 3GPP’s 2 RIT submissions

Introduction – IMT-2020.SPECS:

The forthcoming ITU-R recommendation “IMT-2020.SPECS” identifies the terrestrial radio interface technologies of International Mobile Telecommunications-2020 (IMT-2020) and provides the detailed radio interface specifications.

IMPORTANT: This new ITU-R standard will NOT include IMT 2020 non-radio aspects, such as 5G Core, Signaling, Network Slicing, Network Management/Maintenance, Security/Privacy, Fault Detection/Recovery, Codecs, Interworking, etc.

This new recommendation was developed by ITU-R WP5D (aka 5D) over the last five years. It consists of IMT 2020 (5G) Radio Interface Technologies (RIT) and Sets of Radio Interface Technologies (SRIT).

The final IMT-2020.SPECS is expected to be approved in late November 2020 at the ITU-R SGD meeting.  Here’s the related ITU-R meeting schedule for the remainder of 2020:

WP 5D

36

5 October 20

16 October 20

Geneva

10 day meeting

WP 5D

36bis

17 November 20

19 November 20

Geneva

Focused WP 5D meeting on the technology aspects and related administrative activities for finalization of Step 8 of the IMT-2020 process for draft new Recommendation ITU-R M.[IMT-2020.SPECS]

SG 5

23 November 20

24 November 20

Geneva

Anticipated dates

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IMT 2020 RIT/SRIT submission status:

IMT 2020 RIT submissions from 3GPP/China/Korea [1.], TSDSI [2], DECT/ETSI, and Nufront are all being considered by 5D.  The latter two submissions have defined their own version of 5G New Radio (NR) as they do NOT use 3GPP’s 5G NR.

Note 1.  ATIS found the China and Korea IMT 2020 RIT/SRIT submissions to be technically identical to 3GPPs.

Note 2.  The TSDSI submission uses 3GPP’s 5GNR but also ADDS functional capability to support Low Mobility Large Cell (LMLC).

->Hence, there are potentially three different 5G NRs (as the basis for the respective RIT submissions) that may be standardized in IMT-2020.SPECS if the DECT/ETSI and Nufront submissions achieve final approval from WP5D. 5D requested additional work for both DECT/ETSI and Nufront RIT submissions before they can be progressed to the next step at 5D’s October 2020 meeting.  It remains to be seen if those submissions will be included in IMT-2020.SPECS.

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Sidebar:

The “DECT-2020 NR” Radio Interface Technology (RIT) is designed to provide a slim but powerful technology foundation for wireless applications deployed in various use cases and markets. It utilizes the frequency bands below 6 GHz identified for International Mobile Telecommunication (IMT) in the ITU Radio Regulations.

The DECT-2020 radio technology includes, but is not limited to: Cordless Telephony, Audio Streaming Applications, Professional Audio Applications, consumer and industrial applications of Internet of Things (IoT) such as industry and building automation and monitoring, and in general solutions for local area deployments for Ultra-Reliable Low Latency (URLLC) and massive Machine Type Communication (mMTC) as envisioned by ITU-R for IMT-2020.

–>ETSI supports this DECT RIT mainly because of its URLLC capabilities, according to an email received from ETSI.

DECT-2020 NR is claimed by its sponsor to be a technology foundation is targeted for local area wireless applications, which can be deployed anywhere by anyone at any time. The technology supports autonomous and automatic operation with minimal maintenance effort. Where applicable, interworking functions to wide area networks (WAN). e.g. PLMN, satellite, fibre, and internet protocols foster the vision of a network of networks. DECT-2020 NR can be used as foundation for: Very reliable Point-to-Point and Point-to-Multipoint Wireless Links provisioning (e.g. cable replacement solutions);  Local Area Wireless Access Networks following a star topology as in classical DECT deployment supporting URLLC use cases, and Self-Organizing Local Area Wireless Access Networks following a mesh network topology, which enables to support mMTC use cases.

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5D has approved the 3GPP and TSDSI RIT/SRIT submissions to be progressed to the next step at their recent e-Meeting which ended July 9, 2020.

However, there is still confusion (at least for this author) as to whether the China and Korea submissions (which were stated to be technically identical to 3GPP submissions) will also be progressed or merged with the 3GPP submissions.

–>If they are, it will pose a version change nightmare IMHO.

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Overview of IMT-2020.SPECS:

The radio interface specifications in IMT-2020.SPECS detail the feature and parameters of IMT-2020. This Recommendation indicates that IMT-2020 enables worldwide compatibility, international roaming, and access to the services under all three usage scenarios, including enhanced mobile broadband (eMBB), massive machine type communications (mMTC) and ultra-reliable and low latency communications (URLLC).

The capabilities of IMT-2020 include:
– very high peak data rate;
– very high and guaranteed user experienced data rate;
– quite low air interface latency;
– quite high mobility while providing satisfactory quality of service;
– enabling massive connection in very high density scenario;
– very high energy efficiency for network and device side;
– greatly enhanced spectral efficiency;
– significantly larger area traffic capacity;
– high spectrum and bandwidth flexibility;
– ultra high reliability and good resilience capability;
– enhanced security and privacy.

These features enable IMT-2020 to address evolving user and industry needs.  The capabilities of IMT-2020 systems are being continuously enhanced in line with user and industry trends, and consistent with technology developments.

IMT-2020 Frequencies and Arrangements:

It’s vitally important to recognize that the frequencies to be used by IMT-2020 RITs, including five sets of mmWave bands, will NOT be in IMT-2020.SPECS.  Instead, they will be included in a revision of ITU-R M.1036 Recommendation (see below).  At their July 2020 meeting, 5D could not reach consensus on the draft revision of M.1036, because the Russian Federation expressed concerns about the current version of the revision.  Hence, this work item was carried over to 5D’s October 2020 meeting.

The highly touted and ultra hyped mmWave frequency arrangements (5 were recommended by WRC 19) have yet to be added to the M.1036 revision.  Frequency arrangements in the bands:  24.25-27.5 GHz, 37-43.5 GHz, 45.5-47 GHz, 47.2-48.2GHz, and 66-71 GHz will all use unpaired frequency arrangement with Time Division Duplexing (TDD) used to separate transmit and receive channels for full duplex communications.

Related ITU-R References:

– Recommendation ITU-R M.1036 Frequency arrangements for implementation of the terrestrial component of International Mobile Telecommunications (IMT) in the bands identified for IMT in the Radio Regulations

– Recommendation ITU-R M.2083 IMT vision -Framework and overall objectives of the future development of IMT-2020 and beyond

– Recommendation ITU-R M.1822 Framework for services supported by IMT

– Report ITU-R M.2320 Future technology trends of terrestrial IMT systems

– Report ITU-R M.2370 IMT traffic estimates for the years 2020-2030

– Report ITU-R M.2376 Technical feasibility of IMT in bands above 6 GHz

Report ITU-R M.2411 Requirements, evaluation criteria and submission templates for the development of IMT-2020

– Report ITU-R M.2410 Requirements related to technical performance for IMT-2020 radio interface(s)

– Report ITU-R M.2412 Guidelines for evaluation of radio interface technologies for IMT-2020

– Resolution ITU-R 56 Naming for International Mobile Telecommunications

– Resolution ITU-R 65 Principles for the process of development of IMT for 2020 and beyond

– Document IMT-2020/1 IMT-2020 Background 2020

– Document IMT-2020/2(Rev.2) Submission and evaluation process and consensus building for IMT-2020

– Document IMT-2020/20 Process and the use of Global Core Specification (GCS), references, and related certifications in conjunction with Recommendation ITU‑R M.IMT-[2020.SPECS]

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IMT-2020 Independent Evaluation Groups:

Under Step 4 of IMT-2020 process, candidate RITs or SRITs were evaluated by Independent Evaluation Groups (IEG) that registered with the ITU-R in conformance with the process. In this step, the candidate RITs or SRITs were assessed based on Reports ITU-R M.2411 and ITU-R M.2412.

Table 1

Index of documents related to IEG final Evaluation Reports
for the candidate technology submissions of IMT-2020 under Step 4

IMT-2020/38(Rev.1)

Summary of Step 4 of the IMT-2020 process for evaluation of IMT‑2020 candidate technology submissions

Registered
Independent Evaluation Group

Summary of IEG Evaluation Results

Based on or References IEG Contributions

Evaluation Reports History Documents

5G India Forum

IMT-2020/39(Rev.1)

5D/136 (Various)

IMT-2020/11(Rev.1)

5G Infrastructure Association

IMT-2020/40

5D/50 (3GPP)

5D/51 (DECT)

5D/52 (Nufront)

5D/53 (TSDSI)

IMT-2020/33(Rev.1)

Africa Evaluation Group

IMT-2020/41

5D/123 (DECT)

5D/124 (TSDSI)

5D/125 (Nufront)

IMT-2020/34(Rev.1)

ATIS WTSC IMT-2020

IMT-2020/42

5D/54 (document map)

5D/55 (3GPP RIT/SRIT- technical details document)

5D/56 (3GPP SRIT)

5D/57 (3GPP RIT)

5D/58 (China)

5D/59 (Korea)

5D/60 (DECT)

5D/61 (TSDSI)

IMT-2020/29(Rev.1)

Beijing National Research Center for Information Science and Technology (Bnrist EG)

IMT-2020/43(Rev.1)

5D/146 (Nufront)

IMT-2020/35

Canadian Evaluation Group

IMT-2020/44

5D/90 (Various)

IMT-2020/30(Rev.1)

ChEG Chinese Evaluation Group

IMT-2020/45

5D/69 (Various)

IMT-2020/10(Rev.2)

Chinese Industry and Research Alliance of Telecommunications (CIRAT)

IMT-2020/46

5D/129 (Nufront)

IMT-2020/36

Telecom Centres of Excellence, India

IMT-2020/47

5D/121 (3GPP)

5D/122 (TSDSI)

IMT-2020/9(Rev.2)

The Fifth Generation Mobile Communications Promotion Forum, Japan

IMT-2020/48

5D/95 (3GPP RIT)

5D/96 (3GPP SRIT)

5D/97 (Nufront)

IMT-2020/32(Rev.1)

Trans-Pacific Evaluation Group

IMT-2020/49

5D/94 (3GPP RIT & SRIT)

IMT-2020/8(Rev.2)

TTA 5G Technology Evaluation Special Project Group (TTA SPG33)

IMT-2020/50

5D/49 (3GPP RIT)

IMT-2020/31(Rev.1)

Wireless World Research Forum

IMT-2020/51

5D/120 (Nufront& TSDSI)

IMT-2020/37

The IEGs utilized the defined ITU-R evaluation methodology and criteria established in the relevant ITU-R Reports covering IMT-2020. ITU-R concluded that the IEGs had fulfilled their role in the process and that the inclusion of views from organizations external to the ITU‑R.

Considering the requirements, evaluation criteria and submission templates for the development of IMT-2020 included in Report ITU-R M.2411, the minimum requirements related to technical performance for IMT‑2020 radio interface(s) in Report ITU-R M.2410, and the guidelines for evaluation of radio interface technologies for IMT‑2020 are included in Report ITU‑R M.2412, the conclusions have been reached for each of the IMT-2020 RIT/SRITs submitted by 3GPP, China, Korea, TSDSI (India), DECT/ETSI, and Nufront.  Those detailed conclusions are beyond the scope of this article.

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Overview of 3GPP’s radio interface technologies (E-UTRA/LTE and 5G NR):

The IMT-2020 RIT/SRIT specifications known as “5G” have been developed by 3GPP and consist of LTE and 5G NR Releases 15, 16, and beyond.

In 3GPP terminology, the term Evolved-UMTS Terrestrial Radio Access (E-UTRA) is also used to signify the LTE radio interface. 5G is a Set of Radio Interface Technologies (RITs) consisting of E-UTRA/LTE as one component RIT and (5G) NR as the other component RIT. Both components are designed for operation in IMT defined spectrum.

5G fulfills all technical performance requirements in all five selected IMT-2020 test environments : Indoor Hotspot – enhanced Mobile Broadband (eMBB), Dense Urban – eMBB, Rural – eMBB, Urban Macro – Ultra Reliable Low Latency Communication (URLLC) and Urban Macro – massive Machine Type Communication (mMTC).

5G also fulfills the service and the spectrum requirements. Both component RITs, NR and E-UTRA/LTE, utilize the frequency bands below 6 GHz identified for International Mobile Telecommunication (IMT) in the ITU Radio Regulations. In addition, the NR component RIT can also utilize the frequency bands above 6 GHz, i.e., above 24.25 GHz, identified for IMT in the ITU Radio Regulations. The complete set of standards for the terrestrial radio interface of IMT-2020 identified as 5G includes not only the key characteristics of IMT-2020 but also the additional capabilities of 5G both of which are continuing to be enhanced.

ITU-R WP5D’s conclusion on 3GPP’s 5G SRIT and 5G RIT is shown in the table below:

Radio Interface Technologies:

NAME: (3GPP 5G:1 SRIT)

Proponents (submission in):

3GPP Proponent (IMT-2020/13)2

Determination whether the RIT or SRIT meets the requirements of Res. ITU‑R 65, resolves 6 e) and f), for the five test environments comprising the three usage scenarios

YES
(Requirements met for five test environments)

Inclusion in the standardization phase described in Step 8

YES

Radio Interface Technologies:

NAME: (3GPP 5G:3 RIT)

Proponents (submission in):

3GPP Proponent (IMT-2020/14)

China (People’s Republic of) (IMT-2020/15)

Korea (Republic of) (IMT-2020/16)

Determination whether the RIT or SRIT meets the requirements of Res. ITU‑R 65, resolves 6 e) and f), for the five test environments comprising the three usage scenarios

YES
(Requirements met for five test environments)

Inclusion in the standardization phase described in Step 8

YES

1 Developed by 3GPP as 5G, Release 15 and beyond (as indicated in Documents 5D/1215 and 5D/1216)

2 The NB-IoT part of IMT-2020/15 (China) candidate technology proposal is technically identical to the specifications for the NB-IoT part of IMT-2020/13 (3GPP SRIT).

3 Developed by 3GPP as 5G, Release 15 and beyond (as indicated in Documents 5D/1215 and 5D/1217)

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The 3GPP 5G System (5GS) also includes specifications for its non-radio aspects, such as the core network elements (the Enhanced Packet Core (EPC) Network and 5G Core (5GC) Network), security, codecs, network management, etc. These non-radio specifications are not included in the so-called “Global Core Specifications (GCS)” of IMT-2020.

Support of Industry Verticals:

The E-UTRA/LTE and 5G NR component RITs from 3GPP support a diverse set of mobile broadband (eMBB) services and other so-called industry “verticals,” including URLLC, Industrial IoT, Automotive/V2X, Private Networks (NPN), and others. NR RIT supports in-band coexistence with NB-IoT and eMTC. For optimal support of specific verticals, the 5G NR RIT has been designed, or enhanced, with certain key features, or set of features.

A short summary of relevant NR RIT capabilities for a few industry verticals is provided below.

Ultra-Reliable and Low Latency Communications (URLLC) and Industrial IoT (IIoT): 

For support of Ultra-Reliable and Low Latency Communications services, some of the main features supported by the 5G NR RIT are:
• Logical Channel Priority (LCP) restrictions
• Packet duplication with DC or CA
• New QCI table for block error rate 10*-5
• Physical layer short transmission time interval (TTI)

From 3GPP Rel-16 onwards, URLLC and Industrial IoT use cases are further facilitated by:
• NR PDCP duplication enhancements,
• Prioritization/multiplexing enhancements,
• NR Time Sensitive Communications (TSC) related enhancements,e.g. Ethernet header compression, and
• Precise time information delivery

Factory Automation & “Industry 4.0”:

5G URLLC in Release 16 (RAN and 5G core) was said to improve link reliability by as much as 99.9999%.  These types of applications are best served by a coordinated multi-point (CoMP) approach that leverages multiple transmission and reception (multi-TRP) architecture to provide redundant communication paths with some degree of spatial diversity.

Vehicle-to-everything (V2X) communications:

From 3GPP Rel-16, NR RIT includes support of Vehicle-to-everything (V2X), mainly by means of NR sidelink communication over the PC5 interface, partly leveraging what was defined for E-UTRA V2X sidelink communication.

Sidelink transmission and reception over the PC5 interface are supported when the UE is inside NG-RAN coverage, irrespective of which RRC state the UE is in, and when the UE is outside NG-RAN coverage.

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IMT-2020 Consensus Building and Decision by 5D:

– IMT-2020/15 (China) candidate technology proposal is technically identical to the IMT‑2020/14 (3GPP RIT) candidate technology proposal and NB-IoT part of IMT‑2020/13 (3GPP SRIT) candidate technology proposal;

– IMT-2020/16 (Korea) candidate technology proposal is technically identical to the IMT‑2020/14 (3GPP RIT) candidate technology proposal;

Additionally, consensus building has been performed with the objective of achieving global harmonization and having the potential for wide industry support for the radio interfaces that are developed for IMT‑2020. (?????)

As a result of the consensus building in ITU-R among the seven technology proposals, the following groupings are agreed by ITU-R:

– The SRIT proposed in IMT-2020/13 including NB-IoT part to which China (People’s Republic of) (NB-IoT part of IMT-2020/15) is technically identical, is identified in ITU as “3GPP 5G SRIT”1, developed by the Third Generation Partnership Project (3GPP), for Step 7 and subsequent IMT-2020 development.

– The RITs proposed in IMT-2020/14, NR part of IMT-2020/15 and IMT-2020/16 are grouped into the technology identified in ITU as “3GPP 5G RIT”2, developed by the Third Generation Partnership Project (3GPP), for Step 7 and subsequent IMT-2020 development.

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Future IEEE Techblog posts on 3GPP Rel 16 and IMT 2020:

This author has been in dialog with 3GPP leaders via the 3GPP Marketing Communications Manager to accurately assess 3GPP Rel 16 completed work items related to 5G (both radio and non-radio aspects).  In particular, we are very much interested in the 3GPP Rel 16 URLLC specification, performance simulation(s), and performance testing (not yet started).  Only after independent performance testing will we know if the URLLC test implementation meets the required performance parameters specified by 3GPP and/or Minimum requirements related to technical performance for IMT-2020 radio interface(s) [ITU M.2410].

The IEEE Techblog Editorial Team is soliciting guest blog posts related to 3GPP Rel 16 and/or issues with IMT-2020.SPECS as well as other topics listed here.

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References:

5G Specifications (3GPP), 5G Radio Standard (IMT 2020) and Standard Essential Patents

3GPP Release 16 Update: 5G Phase 2 (including URLLC) to be completed in June 2020; Mission Critical apps extended

https://techblog.comsoc.org/?q=IMT%202020#gsc.tab=0&gsc.q=IMT%202020&gsc.page=1

https://www.itu.int/en/ITU-R/study-groups/rsg5/rwp5d/imt-2020/Pages/submission-eval.aspx

https://ieeexplore.ieee.org/stamp/stamp.jsp?arnumber=9114983

https://www.3gpp.org/news-events/2129-sweet_rel_16

https://www.3gpp.org/news-events/2130-video_sa