“4G changed your life. 5G will change society.”
August 15, 2019
The 2019 Summer Davos – World Economic Forum’s Annual Meeting of the New Champions held in Dalian, China on July 1-3, 2019 focused on economic globalization in the new era, where technologies, innovations and value chains of the latest round of industrial revolution play driving roles. There were several discussions dedicated to connectivity ecosystems and an inclusive global implementation of 5G among industry leaders, innovators and policy-makers.
Why 5G Matters
A public session at the forum themed Why 5G Matters, developed in partnership with Channel News Asia, is a dialogue about why and how 5G will revolutionize people’s life and work enabling an era of hyper-connectivity. Despite overwhelming public relations about 5G in recent years, most people are not well informed about this next big thing in mobile technology. According to a poll by Channel News Asia, 89% of respondents don’t think they know much about 5G.
Mikael Bäck, Vice President at Ericsson, who has been in this industry for almost 30 years, pointed out what differentiated 5G from previous generation networks is that it is designed as a system platform to connect everything that can benefit and revolutionized from being connected, and that it is intended for enabling digitalization of all industries of the 4th industrial revolution, not just for the smart phone that everyone is already familiar with. Zhou Bowen, Vice-President of JD Group said people usually know one of the attributes of 5G which is its high speed, but are not well aware of the other two of its outstanding capabilities. The first one is interconnectivity with optimization of smart devices, with which the resulting cost-saving and efficiency improvement in the logistic industry are exponential. The second is low latency, with end-to-end delay be less than one mini second, which could offer usability in many more mission critical applications. According to Sihan Bo Chen, Head of Greater China at GSMA, a trade body that represents the interests of over 750 mobile network operators worldwide, there are already 120 member operators rolling out their 5G plans in the last few years. She believed 5G matters because “it is the largest consumer technology across the globe”, with already 5 billion mobile users by the end of 2018 and the number will rise to 70% of world’s population by 2022 (Cisco predicts).
In response to the question of “how to ensure the economic and societal benefits from widespread deployment 5G to reach all members of society in an inclusive and equitable fashion”, panelists had mixed views. Sihan Bo Chen of GSMA admitted the potential negative impact on Digital Divide as 5G networks are expected to be deployed first in urban areas. Mikael Bäck of Ericsson, stated from a positive perspective that some developing countries are more proactive in regulatory support than some developed countries. He emphasized the importance for governments and regulators to set up mechanism for lowering the spectrum costs, while network operators leverage modern equipments to reduce operational costs and invest in infrastructure to reduce deployment costs. Zhou Bowen of JD Group was also optimistic about 5G’s potential to bridge the gap of inequality, giving an example of 5G enabling remote surgery system to benefit communities in rural areas which would be otherwise impossible. Hera Siu, Chief Executive Officer of Greater China Region at Cisco, believed that 5G can be used for narrowing the gap of the urban and rural divide, as “4G is about connectivity, 5G is about connecting the unconnected”, including the currently uncovered populations in underdeveloped areas.
Overall, general public’s expectations are very high about what 5G can deliver. According to the polls by Channel News Asia, 68% of respondence thinks 5G is a “Force for Good”; and only 30% thinks countries don’t need 5G for Economic Development.
5G Transformation and New Business Models
Fluxus executive attended the Multilateral Meeting: 5G Transformation and New Business Models hosted by the World Economic Forum. This meeting gathered relevant stakeholders to explore cross-industry collaboration opportunities and security challenges building on the work of the Forum’s 5G-Next Generation Networks Programme.
Key Points from the Multilateral Meeting by World Economic Forum:
- 5G licensing is currently happening at a rapid pace, but still with limited understanding of both the use cases from the potential vertical industries, as well as the design of the networks themselves. There is still a misconception about the use of 5G in industries that this will only enable faster internet connectivity for devices, rather than this only be the first use case of a much more significant technology transformation that will support an ever more complex set of use cases.
- 5G is not a future issue, rather it is a present day reality which requires a much stronger and robust integration strategy across stakeholders. 120 operators, currently have plans to test 5G networks, and 7 currently do, most notably in Korea, whose experience needs to be much better understood by the wider market given the complex issues facing the design and roll out of network over the next 10 years. Critically the market leader in the adoption of 5G and new use cases will be China, given the significant Government investment and priority to the technology. This will require new models of cooperation to understand and enable other jurisdictions to learn from this experience.
- Real dialogue now needs to take place to understand the return on investment models, data models, and roll out lifecycle, it is little understood currently within key verticals. Overlaid on this is the understood of the geography of adoption, i.e. where is the early adoption across the use cases and end state. Example, it is predicted that only 10% of use cases at a ten year end state will come from media and personal device use such as streaming, rather the 90% will be taken up by industry verticals, with most testing happening within East Asia and not the US or Europe, but where the adoption of the most advanced use cases are predicted. Example, where will precision medicine be tested and rolled out in practice. Industry vertical adoption will not be simultaneous, but critically the predicted end state users (i.e. mobility) need to be involved now in the design and creation of the networks. This is not currently happening now, and is of critical importance.
- Realistically, all the most significant use cases will now be tested and adopted within the next seven years, given the complexity of the risks, including cybersecurity, regulation, issues over spectrum allocation and the potential of a two speed internet, more work is needed to move the needle. Within Cybersecurity, while 5G as a technology from a technology standpoint has benefits, the implications from a security perspective are also limited in understanding. 5G will remove the last barrier to scale within the Cybersecurity landscape and consequently could significantly alter the threat and risk models. This will have significant implication both for industry, as well as public bodies who will regulate and investigate cybercrime. Critically new zero-trust models might be required to embedded security by design across entire supply chains as well as data sharing models.
- In order to codify and explore these issues, to move the needle, we should explore the creation of a consortium to come together on the Wold Economic Forum platform to help drive change and realize the full benefits of 5G.
Notes by Fluxus
Fluxus joined the Forum’s Centre for the Fourth Industrial Revolution to contribute domain knowledge in the housing delivery value chain to the 5G-Next Generation Networks Programme. At Fluxus, we are intrigued by the potential value that 5G as an enabling technology can bring to reconstruct the housing value chain, introduce new financing vehicles, and deliver solutions profitably at a global scale. However, much work is needed to realize this vision:
- 5G-friendly buildings can create new business model opportunities that may make real estate investments more profitable. Development capital is needed to demonstrate its potential.
- 5G technology may widen affordable housing access to low-income families by creating alternatives to traditional home ownership and home lease models.
- Many traditional constructions approaches have been found to negatively impact performance. Research is needed to explore the impact of building materials and design on 5G compatibility.
- We believe the build out of 5G technology and infrastructure is very compatible with prefabricated building system approach. 5G components can be integrated into a modern, industrialized construction process which will reduce cost and improve performance and reliability.
- A coordinated global effort is needed to create policy frameworks and industry standards to leverage 5G technology’s full potential in order to accelerate productivity and cooperation across core vertical industries throughout housing delivery value chain.
Read World Economic Forum Industry Agenda: “How 5G can connect the affordable homes of the future? – The new mobile comms standard will facilitate the construction and functioning of the next generation of housing.” by Fanyu Lin and Michael Gallagher.
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