The mobile industry has seen significant growth in recent years as the advent of 4G and now 5G has created new business models, engaging apps, facilitated new ways of working and transformed economies. This has led to an exponential growth in data usage. Ericsson states that global mobile traffic rose an enormous 49% in 2019. In recent months, operators have noted a surge in data consumption owing to the COVID-19 pandemic.
In Europe, Telenor Norway reported a 25% rise in mobile data traffic and Vodafone has seen mobile data usage grow by as much as 50% in some markets. Vodafone and others have said they expect the surge in data usage to continue.
In the U.S., Verizon emphasized recently that even more significant than the increase in data consumption is the spike in particular types of traffic. On its network, use of collaboration tools shot up 1,200%, gaming 150% and streaming 50%. In Korea, over a quarter of all mobile data traffic is already on 5G connections.
This raises the obvious question of how networks can continue to adapt to this change in demand, in terms of traffic volume and traffic type, which is adding pressure to the uplink in addition to the downlink.
A big part of the answer lies in millimeter wave (mmWave) technology, which uses high frequency spectrum beyond 24 GHz. This has some major advantages: This is new spectrum for mobile services, it has extremely high capacity and can therefore deliver multigigabit throughput.
In crowd-sourced data, provided by Ookla's Speedtest platform and originating from commercially available devices powered by Qualcomm's Snapdragon modem-RF systems in the U.S., mmWave devices delivered peak speeds of more than 2 Gbps and average download speeds of 900 Mbps. This is four times faster than the speeds experienced on sub-6 GHz 5G devices. The Ookla results were achieved on commercial millimeter wave networks using 400 MHz of spectrum. With future deployments using 800 MHz, these speeds could well double. This points to the crucial role that mmWave spectrum will play in providing fresh capacity as demand continues to soar.
5G isn't a destination; it's a journey
There is of course a trade-off with millimeter wave spectrum: It doesn't propagate as well as lower bands, which makes coverage challenging, and deploying millimeter wave networks across a large area is difficult and expensive. This is why we expect operators will adopt a combined approach using multiple frequency bands.
5G is a journey and one that will need multiple lanes for traffic to flow efficiently. For a network to work in different environments on a nationwide basis it'll need a mix of low, mid- and high bands. Low bands enable broad coverage and mid-bands a blend of capacity and coverage. High bands (millimeter wave) will be critical for capacity and to enable many of the high-bandwidth, low-latency uses being touted for 5G. T-Mobile US describes this complete approach as a layer cake.
This is an important part of how 5G is being implemented. 5G seeks to provide robust connectivity for a wide variety of uses and devices on a broad geographic spread. This is only possible by implementing multiple frequency bands that can balance the need for capacity, speed and coverage.
Furthermore, spectrum is a finite resource and the availability of licensed spectrum varies by country. The spectrum that an operator uses to launch a network is limited by the assets it has available. Spectrum availability is therefore another factor in why millimeter wave hasn't yet been widely deployed. However, we predict that this will change significantly over the next two years as data consumption rises, the need for capacity grows and operators seek new revenue streams dependent on high-throughput, high-capacity and low-latency connectivity.
Momentum builds in Europe and Asia
In 2020 we expect to see mmWave launches in Australia, Japan, Russia and South Korea, with further expansion planned in 2021. According to the Global Mobile Suppliers Association, 123 operators are investing in spectrum between 24.25 GHz and 29.5 GHz (bands n257, n258 or n261).
In Europe, Italy has assigned spectrum in the 26 GHz band, with service launches expected later in 2020. In January, Telecom Italia claimed a speed record with millimeter wave at more than 2 Gbps. A host of other European countries are due to assign spectrum in the second half of the year. Finland is next in line, with 26 GHz spectrum being auctioned soon.
Other countries including Denmark, France, Latvia, Lithuania, Luxembourg, Malta and Spain have also promised to make 26 GHz spectrum available in 2020. COVID-19 has caused a small delay, but we still expect this to result in a wave of European launches in 2021. China is also likely to follow a similar timeline.
The pandemic will spark permanent change but there will be a return to a new normal. Habits will change, but China, Japan and South Korea show us that people density soon returns. It's unlikely that large music and sports events won't return in a year or so, let alone in the 10-year lifespan of 5G. In these environments millimeter-wave networks will play a major role. Furthermore, the pandemic has put new opportunities in sharper focus, as we explored in a recent blog post (see The Need for 5G Has Never Been Clearer).
Similarly, we expect 5G technology to fall rapidly down the price curve and believe this will coincide with a dramatic increase in the availability of compatible millimeter-wave devices. Qualcomm is delivering mmWave capability into its mid-range Snapdragon 6 series chipsets in 2020 and we expect others to follow steadily in 2021. Notably, Verizon has promised compatible devices under $600 this year and recently added the OnePlus 8 smartphone, which has full millimeter-wave support, to its catalogue at $800.
By 2025, 5G will carry almost half of all mobile data traffic, according to Ericsson. Capacity alone is a justification for millimeter wave networks and mounting global support is evidence of that. Competition will propel further investment as operators seek to avoid being left behind. Millimeter wave is a rising tide.
Geoff Blaber is vice president of research for the Americas at CCS Insight. Based in California, Blaber heads CCS Insight’s Americas business and supports the range of clients located in this territory. Blaber's research focus spans a broad spectrum of mobility and technology, including the lead role in semiconductors. He is a well-known member of the analyst community and provides regular commentary to leading news organizations such as Reuters, the Financial Times and The Economist. You can follow him on Twitter @geoffblaber.
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