April 9, 2020
For the majority of people, COVID-19 is like a bad dose of the flu, according to the world's health experts. Less fortunate individuals have tragically succumbed to the virus or been left seriously incapacitated by it.
In the world of economics, the situation is perhaps reversed. Most businesses will suffer a nasty contraction as a result of the lockdowns that governments have imposed on their citizens. A minority will fare better, including many of the technology giants whose services have become a critical lifeline amid the pandemic.
But one technology that has already caught an acute infection is 5G, and its status has not been helped by phony and outrageous claims that it's the true cause of COVID-19. In parts of the world, it will suffer badly over the next few months as projects are delayed and spending is squeezed. For some of the companies invested heavily in the new-generation network technology, the next few months will be ghastly.
It might not have been this way if the pandemic had come two or three years later. Cheerleaders, including public-sector officials, think 5G will eventually provide connections for a global "Internet of Things" that includes everything from a pair of trainers to the robots that make them. If the vision becomes reality, 5G will be as important in the mid-2020s as residential broadband is today.
But when COVID-19 arrived, the industry had little of substance to show for its efforts. The official standard that is intended to support the more advanced applications has now been delayed. The European Telecommunications Standards Institute is not even sure if these services are feasible without changes to the foundations of the Internet. China's Huawei, the world's biggest maker of 5G equipment, has flagged the same concern – although critics see its "New IP" alternative as a sinister Chinese plot to hijack the Internet.
All 5G companies had accomplished was the design of a technology that provides faster connections and additional capacity on smartphone networks. A few have already been launched, and South Korea, the most advanced market, already has millions of subscribers. Yet local news reports suggest many have been underwhelmed by the 5G experience. For service providers, it has had minimal impact on sales while marketing and rollout costs have made a huge dent in profits.
This will discourage investment in countries under COVID-19 lockdown. As customers downgrade to cheaper services and dump TV sports packages rerunning last year's highlights, many operators will cut spending. Concerned about exposing field workers to unnecessary health risks, they will prioritize the maintenance of networks already used by the majority. Moreover, people confined to their broadband-equipped homes for most of the day have little use for mobile data networks. Any additional investment is likely to go into fiber-optic equipment.
5G launches will also be delayed in European markets that have postponed auctions of the spectrum needed to support services. Austria, the Czech Republic, France, Portugal and Spain are all now reported to have delayed auctions. Without spectrum, 5G will obviously not fly.
Fearmongering stories linking 5G to illness could also hinder rollout. Countries such as Belgium and Switzerland have imposed limits on the use of 5G antennas amid lingering concern that radiofrequency emissions are carcinogenic. The World Health Organization says mobile frequencies are too low to be dangerous, but activists are unconvinced. In the UK, operators now have to contend with the ludicrous suggestion that 5G networks transmit COVID-19. After misinformed tweets by celebrities including Amanda Holden, a British actress and reality-TV regular, 5G masts were burnt in the cities of Belfast, Birmingham and Liverpool.
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The news is not all bad. Only today, Sweden's Ericsson announced the launch of a commercial 5G network in Hungary by Magyar Telekom, the country's biggest operator. "Particularly in times of crisis, mobile networks are even more critical than ever before," said Arun Bansal, the head of Ericsson's business in Europe and Latin America, in a hopeful statement. "5G opens possibilities like never before, from remote medical care, instant emergency services, drones delivering supplies, all of which can support society during a pandemic."
As useful as some of those services might be, they are unlikely to crystallize until the pandemic has passed. Ericsson's only real hope is that other service providers press ahead with deployments that were already planned. Those in good financial shape may see an opportunity to emerge from the crisis with a 5G lead over their competitors.
China, meanwhile, remains determined to erect more than half a million 5G basestations by the end of this year. Claiming to have beaten COVID-19, it has lifted restrictions on the movement of people and reopened its factories. For the equipment makers building those 5G networks, this investment program could be essential medicine. Just last month, China Mobile, the country's largest operator, awarded 5G contracts worth $5.2 billion. Unfortunately, with almost 90% of the work going to domestic suppliers Huawei and ZTE, Western vendors will not be able to count on China for a boost.
— Iain Morris, International Editor, Light Reading
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