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5G

DT, EE, Orange, Vodafone Open Up on 5G

There is still tremendous uncertainty around 5G rollouts among four of Europe's biggest service providers, according to comments made in advance of next month's Mobile World Congress in Barcelona, at which higher-speed mobile network technologies are likely to be a major topic of discussion.

In conversations with Light Reading, the companies revealed plans are still not entirely concrete; nor are they that similar, in terms of timing, spectrum and planned early usage of 5G services.

Germany's Deutsche Telekom AG (NYSE: DT), the UK's EE (a subsidiary of fixed-line incumbent BT Group plc (NYSE: BT; London: BTA), in which Deutsche Telekom holds a 12% stake), France's Orange (NYSE: FTE) and the UK's Vodafone Group plc (NYSE: VOD) face some big strategic and network decisions over the next few years as the finishing touches are put to the first 5G standard.

Set to bring about sharp improvements in connection speed, and an important reduction in network latency (the delay that occurs during data downloads), 5G technology could hold attractions for smartphone-wielding consumers as well as enterprises and public sector organizations in a range of industry sectors.

What's more, the software and virtualization technologies that are baked into 5G should -- in theory -- make it easier for telcos to address these different customer groups in an efficient way.

But 5G raises some big questions for operators threatened by an array of competitive, economic and regulatory forces. Does a telco opt for a "big bang" rollout, in an effort to get ahead of rivals, or take a measured approach? Will available spectrum support the applications that are of most interest (and what are those, exactly)?

And is 5G a revenue growth opportunity or a defensive gambit aimed at preventing sales and profits from declining?

That last question will be of particular interest to the investment community. A recognition that 5G will not reinvigorate sales could disappoint some shareholders given all the recent hype about the technology's promise. Yet previous generations of network technology have failed to spur topline growth. (See 5G: Another Next-Generation Disappointment?.)

Mobile Service Revenues ($B, Using Current Exchange Rates)
Source: companies. Note: Each operator has a financial year that runs from January to December, except Vodafone, which reports from April to March (so its 2015 financial year ends in March 2015).
Source: companies. Note: Each operator has a financial year that runs from January to December, except Vodafone, which reports from April to March (so its 2015 financial year ends in March 2015).

EE has justified its heavy spending on 4G by saying that its revenues would have declined at an even sharper rate otherwise. It also says the introduction of new technologies reduces the value of older ones. (See EE: New Tech Is Mobile Revenue Savior.)

The implication is that 5G will follow the same pattern.

Next page: It's all in the timing

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TV Monitor 1/16/2017 | 11:54:27 PM
Re: Beam us up, 5G t.bogataj

No, they take whatever frequency is available to them.
t.bogataj 1/16/2017 | 2:40:05 AM
Beam us up, 5G Iain, apart from business and technological aspects of 5G -- does any European operator mention health concerns related to introduction of 5G? Or take them into consideration when selecting/evaluating frequencies to be used for 5G? Does anyone ask them about this?

T.
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