When an executive from Nokia, of all companies, said 5G was as much about fiber as wireless, it was clear this was going to be different from previous mobile standards generations.
5G will not be driven by mobile broadband speeds as 4G was. If higher data rates and larger numbers of broadband devices are an MNO’s only goals, it will be better to stick with LTE for many years to come, especially with Gigabit LTE becoming a reality (and the operator can always label it ‘5G’ anyway).
The superior efficiencies of the 5G New Radio will not outweigh the cost of deploying a brand new network, except for a greenfield company. The full benefits of 5G will only be achieved with a full architecture change, not just a radio upgrade – and many of those changes, such as virtualization, can be phased in gradually while the LTE radio stays in place. Adding the 5G NR in at some point will certainly create a powerful combination – the radio and the architecture will bring out the best in one another in performance and cost-efficiency terms.
But that will only be worth the expense and disruption if there are new revenues, because mobile broadband – as Finnish operator DNA made clear in an interview with Mobile Europe (below) – will not deliver sufficient revenue upside to justify 5G. All that means that operators should not fixate on NR – LTE enhancements, combined with virtualization and strong investment in fiber, can get them a long way to their goals.
That shift of emphasis away from the RAN standard, and towards backhaul/fronthaul and virtualization, means the balance of power is changing too, and those suppliers which have dominated the value chain thanks to their radio expertise will have to ensure they can also assert control in other areas, from convergence to orchestration.