Now that 5G is official, expect to see some cracks in the “skipping happily into the sunset” rose-colored glasses that many have been looking through the last couple of years. As this year unfolds, the 5G hype that was so pervasive last year is giving way to a reality check. Not only are those with deep pockets beginning to become more conservative and turn down the money spigot, but the skin that all is good in 5G land is becoming more transparent and the skeletons are beginning to show.
Not that this is surprising. The ruse that everyone is united in getting 5G up and running could not last, especially in light of the lackluster, early performance of 5G in the recent debuts. It appears that those people building out the networks are looking for ways to leverage the technology and try to keep their arms around the costs of deployment.
Figures from the early deployments, in places like Chicago, have failed to impress. Granted that most of the numbers are better, but not by as much as the hype was predicting. In fact, in one case the rates were actually lower. Moreover, there is much more to those numbers than just raw Mbps. In the end, the average, mean download speed was just over 40 Mbps for AT&T as compared to T-Mobile, which was just a tad over 35 Mbps. Before 5G (4G networks) the latest download numbers peg 34 Mbps for both (Verizon was close to these as well, Sprint was the lowest of all). So, considering the fact that the 5G numbers were under optimum network conditions, that is not impressive.
Peak data rates are never a good indicator of real-world network performance. They simply are numbers under the best of conditions used for bragging rights. Moreover, those peak 5G numbers have only been a couple of hundred megs above the peak number available in 4G. In fact, the actual performance becomes even murkier when these 5G networks were taxed with large app and video file downloads. As well, the phones used in these debuts had a hard time maintaining the connections and often flipped back and forth between 4G and 5G.
The media and analysts have dissected these results six ways from Sunday. And, much of the reviews have been less than stellar. However, the industry has only itself to blame with all the hype that had been disgorged in advance of the rollout.
The carriers are all doing damage control. From saying that this was expected, to it is early on in the game, to lack of a dedicated 5G core. However, the bottom line is that the results have been disappointing, all around.
Now, the carriers are faced with an even tougher challenge of trying to monetize this in the wake of this rather dismal reality. It was obvious from the start that hiking prices was not going to cut it. So, how they are going to try to win over users to buy into 5G? I was wondering what the marketing geniuses were thinking. Common knowledge suggests the typical marketing vectors – from pricing, to package deals, to enticing users with new apps and features.
However, I have to hand it to Verizon. They came up with something I would never have thought of. I am off on this because one of my feeds had some data about a scheme that Verizon experimenting with to generate 5G awareness and interest. Verizon has gone to the public with a contest called the “Built on 5G Challenge.” It seems they are trying to tap idea generators outside of their own ecosystem. It is a call for products, services, and applications for 5G.
I must admit, this is a, rather, unique way to drum up visibility. If one has, what they believe is a killer 5G app, all one has to do is fill out an application and hope it is the big one.
However, everybody is in the same boat – looking for killer apps. While Verizon has come up with a novel approach, all of them are looking at vectors that have a more mainline appeal – and there are some.
One is gaming. With online, real-time gaming, the selling point is latency. Online gaming needs low latency and more than bandwidth. Fortunately, gaming data does not need a lot of bandwidth. That is because much of it is redundant from frame to frame and the real video enhancement work is done at the client end. In addition, compression schemes work wonders on gaming data. So, for this business case, latency is the leverage.
The same is true for “X” reality. For this to be acceptable, latency must be less than 20 milliseconds (ms). And, that is the absolute maximum. Many people can see the effects of latency down to 15, or even 10 ms.
Another case for low latency is factories. Machine-to-machine (M2M) automated factories must have very low latency connections – down to 5 ms max, with 1-2 ms being the goal. The complex interactions of robots and automated machines, in a fast-paced manufacturing environment, often rely on split-second decision making to adjust to production glitches, faults, environmental changes and more.
Then there is the world of business and retail. Latency is not as big a factor here as is bandwidth. Malls, office complexes, campuses, sports and other entertainment venues, smart cities and more — all demand lots of smart, dynamic bandwidth managed by AI.
These are just a few of the segments that have income potential. In reality, there is a slew of potential revenue sources for which 5G specs are ideal and necessary. Therefore, the great unknown is not what it can be used for.
However, until 5G is proven and ubiquitous, it is going to be a hard sell. It needs to work and work up to expectations before users are going to shell out premium dollars for it. Carriers and other wireless providers are going to have to buck up and build it, banking on future revenue to make up for the initial cost of deployment.