According to analyst firm Omdia, COVID-19 will have a significant impact on telecoms revenues this year; a $31.8billion impact, in fact. This comes as little surprise. The world has ground to a halt and every industry has been impacted in some way by the virus.
So as the world starts to emerge from the disease, and as countries ease lockdowns, how are operators rethinking their 5G strategy in the face of even tighter cash constraints?
Two technologies with one spectrum band
One technology gathering momentum is Dynamic Spectrum Sharing (DSS). This game-changing technology essentially allows operators to provide 5G coverage and improved speeds using existing 4G spectrum. This is possible because many of the 4G radios in use in networks today were designed to be ‘5G ready,’ and therefore support both technologies without the need to buy additional spectrum, or re-farm other available bands.
DSS is essentially a software upgrade. When launched, determining which technology needs to be supported by which radio is decided according to the device, service requirements, load levels and amount of buffering required. The network then dynamically and instantly allocates 4G or 5G capacity as needed. Spectrum and network resources are then portioned out to the millisecond, which is the true requirement and measure, for DSS success.
Short term gain, not long term glory
DSS is unlikely to serve as a long-term 5G solution, but it will provide a highly useful short term solution in helping operators monetise early 5G services cost effectively. It may also prove particularly enticing for operators whose spectrum auctions have been delayed as a result of COVID-19, or for those who have only been able to acquire millimeter wave spectrum, and thus for whom achieving significant population coverage will be hard and expensive.
In addition, DSS helps ease the transition from non-standalone 5G networks to standalone 5G by providing a layer of 5G coverage prior to a core transition. Big changes can be risky, but with DSS, CSPs have a bit of an insurance policy to help support their business as it makes the shift to standalone 5G.
Unfortunately, since spectrum is a finite resource with defined capacity, sharing it will only get operators so far. DSS will work fine while 5G continues to form just a small part of network demand, but as this demand grows and as we see more people acquire 5G handsets and as more 5G services are rolled out, 4G networks won’t be able to cope. At this stage, operators will have to think about building additional infrastructure and investing in 5G spectrum to meet the demands of new 5G services.
In addition, DSS will only be able to support the initial phase of 5G that is focused on enhanced network speeds. Anything beyond that—ultra reliable low latency communications (uRLLC) or machine-to-machine type communications (MMTC)—will require dedicated 5G infrastructure and spectrum. DSS won’t support key 5G capabilities like network slicing which will form an important part of operators’ 5G monetization strategies.
Momentum is building, but DSS isn't for everyone
Many operators continue to face issues trying to obtain, and afford, new 5G spectrum. Despite this, Ericsson still believes that as many as 80% of its operator customers plan to deploy DSS within the next 12 months. The path that operators choose to take when it comes to DSS will very much depend on the type of spectrum they have, the bands that might be available to them in future and how long it will take before these bands become available.
This is especially true in the U.S. where Verizon, AT&T and T-Mobile are all pursuing different 5G roll-out strategies because of the type of spectrum they each own. Verizon is more dependent on mmWave spectrum bands and so is using DSS to help it extend its 5G reach, especially to its rural subscribers. T-Mobile on the other hand, is less excited by DSS as it owns large amounts of low band 5G spectrum already, negating the need to further stretch its low band 4G spectrum. European operators are also exploring DSS with Vodafone Germany and Swisscom being among the first to roll it out.
COVID-19 and its impact on 5G remains unclear
It is likely that the impact of COVID-19 will continue to slow down 5G network deployments for many global operators for at least another six-nine months. Consumer demand for faster speeds and improved connectivity will remain, especially as some operators in some countries are more advanced with 5G deployments than others.
DSS provides a short term, cost effective means to meet this demand and buy operators a little more time to contemplate how and when to deploy standalone 5G infrastructure. Most operators already have the spectrum and 5G-ready radios that enable DSS – there’s little wonder so many operators are seeing what DSS can do.