CES Is Only a 5G Scene-Setter for MWC

Mike Dano
1/11/2019
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LAS VEGAS -- CES 2019 -- The big Consumer Electronics Show is winding down here in Sin City, and despite the fact that 5G is already commercially live in a few cities across the country, show attendees didn't really get much in the way of anything new, exciting or concrete on the 5G front.

Instead, much of the discourse here at the show was the same kind of "5G is going to be a quantum leap" rhetoric that those in the wireless industry have been hearing for years now. But that's in part just due to the nature of this particular trade show.

"The Consumer Electronics Show is a consumer electronics show and not a wireless show," explained Recon Analytics analyst Roger Entner. "You get secondary kind of news."

To be clear, the show wasn't completely devoid of 5G news. Perhaps the most noteworthy 5G announcement to come out of CES was AT&T's promise to roll out 5G nationwide by "early" next year, albeit on its non-millimeter-wave spectrum bands. But news of AT&T Inc. (NYSE: T)'s 5G pledge was mostly overshadowed by the operator's decision to replace the "LTE" icon on a good chunk of its Android phones with a "5G E" logo. Verizon Communications Inc. (NYSE: VZ), T-Mobile US Inc. and Sprint Corp. (NYSE: S) all jumped at the chance to complain that AT&T's marketing move was duplicitous at best, and all argued that they would instead take the high road by launching "real" 5G. (See Verizon, AT&T Spar Over 5G Service Names, Marketing, AT&T's Donovan Defends the Carrier's 5G Fibs and CES 2019: The Phony 5G Wars.)

This kind of bickering is to be expected. Given the decades of heated competition in the wireless market, coupled with recent belt-tightening by carriers and vendors, there's little chance that all four nationwide wireless network operators would make an orderly procession toward 5G without some amount of jostling.

(Also, the truth is that there are no real rules around how carriers should use the "5G" label. The standards body for the global wireless industry, the 3GPP, will continue to push out new collections of network technologies -- Release 15 is out now and Release 16 is coming next -- regardless of how those various and mostly disparate technologies are branded. So if there are no rules, carriers can play the game however they see fit.)

Perhaps the biggest surprise on the 5G front here at CES was the complete lack of official 5G phone announcements. Yes, Sprint said it would sell a Samsung 5G phone sometime this year, and Intel Corp. (Nasdaq: INTC) and Qualcomm Inc. (Nasdaq: QCOM) touted their progress in selling 5G chipsets to handset makers, but no handset maker stepped forward with an official 5G phone launch. Instead, perhaps the big theme at CES this year was how digital assistants from the likes of Google (Nasdaq: GOOG) and Amazon.com Inc. (Nasdaq: AMZN) are being embedded into an ever-growing range of devices. (After all, who doesn't want Alexa bickering with them while they're driving?)

Nonetheless, the wider tech industry probably won't have to wait too much longer to get a clear look at some real 5G phones: Samsung Corp. just this week scheduled a media event for February 20 where it will likely announce its next Galaxy flagship smartphone, including possibly versions with a foldable screen and 5G.

Leaving Las Vegas?
So what to make of this year's CES? What were the big takeaways, at least in terms of 5G?

Verizon offered perhaps the most cohesive 5G story at the show, which isn't that surprising given the company launched its 5G Home fixed wireless Internet service in October of last year, and then just a few weeks later scheduled its CES keynote. The keynote was also a bit of a coming out party for Hans Vestberg, who just a few months ago took over control of Verizon from outgoing CEO Lowell McAdam. (It's worth noting that this wasn't Vestberg’s first time on the CES stage: He keynoted as CEO of Ericsson back in 2012. This time around though he ditched a suit for a T-shirt, but retained his appreciation for fancy marketing phrases: In 2012 it was all about the "networked society" and this time, with Verizon, Vestberg was all about the "fourth industrial revolution.")

Verizon CEO Hans Vestberg in T-shirt mode...
Verizon CEO Hans Vestberg in T-shirt mode...

But instead of announcing Verizon's mobile 5G plans, or providing more color on his company's use of 5G to directly challenge wired internet providers like Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Charter Communications Inc. , Vestberg opted instead to paint a big picture of how 5G might affect the wider world beyond just smartphones. To do so, Vestberg first laid out Verizon's 5G performance goals -- peak rates of 10 Gbit/s, 5 ms of latency and 99.999% reliability -- and then brought in speakers from the likes of Disney, the New York Times Company and the NBA to discuss how 5G will affect enterprise verticals like healthcare, journalism, gaming and video. Vestberg also announced Verizon's "Built on 5G Challenge" to award up to $1 million to innovators to create new solutions that leverage 5G connectivity. (See Verizon's 5G CES Keynote: T-Shirts, But No Beef.)

Overall, Vestberg's message was relatively clear: 5G will ultimately be used in a variety of different market sectors for a variety of different applications and services. Meaning, it's not going to be LTE on steroids.

"Consumers need to become aware of what 5G can do," Recon Analytics' Entner argued. "It's a whole different set of experiences."

Others, though, offered a bit more cynicism.

GlobalData analyst John Byrne pointed out that "Vestberg offering $1 million for innovative 5G ideas which, while well intentioned, also signals that the industry has a lot of work to do to get to a lot of the advanced use cases that have been envisioned for 5G."

"The operator keynotes [at CES] highlighted the merits of 5G, but articulating this to consumers will be a hard sell. Therefore, greater focus is being placed on enterprise use cases," added Paolo Pescatore, an independent tech, media and telco analyst.

The issue is clearly going to be an uphill climb for carriers: According to a new survey of 15,000 mobile users in 16 markets conducted by GSMA Intelligence and reported by MWL, almost 25% of respondents were unable to name any 5G benefits.

So should the wireless industry collectively avoid CES? Analyst Mark Lowenstein, managing director of Mobile Ecosystem, said that CES remains an important industry event in terms of discerning tech directions. For example, he said this year's event showed that vendors are making progress on the IoT and autonomous vehicles.

Peter Jarich, head of GSMA Intelligence, agreed. "It's easy to get caught up in the news from CES and miss out on the broader messages and business themes it telegraphs. Love it or hate it, though, it's impossible to deny the importance of CES, not just for retailers or gadget buyers, but for anyone looking to understand the shape of service provider and enterprise business strategies," he wrote this week.

Barça or bust
Ultimately, though, wireless executives across the spectrum agreed that CES ultimately is just an appetizer. The upcoming Mobile World Congress trade show -- to be held in Barcelona, Spain, February 25-28 -- will be the main course.

"The real news will be in Barcelona," said Recon Analytics' Entner.

"It seems clear that the MWC positioning is well underway and I fully expect lots of operators to provide more details about their 5G rollout plans there," GlobalData's Byrne said.

"Mobile World Congress will now be awash with 5G device announcements ahead of network launches later in the year. Congress in Barcelona will be a much better fit for 5G news than CES," Pescatore said.

And Qualcomm's Durga Malladi -- the executive who for years helped lead the company's research into 5G and who is now is in charge of the sale of its 5G products -- said Qualcomm plans to go all-out in Barcelona. Without providing specifics, he said that Qualcomm's CES operation will pale in comparison to its MWC efforts.

This all raises one final question: Is 5G worth all this hype? Many contend the answer is a resounding "yes."

"It really does make sense to talk about 5G as more than just another G," GSMA Intelligence's Jarich said.

"When these applications are running, people will say 'wow,'" said Entner.

— Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading

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