Telstra expects accelerated adoption of 5G

The initial set of 5G standards have only just been finalised, but Telstra CEO Andy Penn said he expects adoption of the next-generation wireless technology to be even swifter than its predecessor.

“It took eight years for 2.5 billion people in the world to move from 2G to 3G,” Penn told the Telstra Vantage conference in Melbourne. “It took five years for 2.5 billion people to move from 3G to 4G. And my expectation is that the rate will continue to accelerate as we move forward into the world of 5G.”

The initial rollout of 5G will see support for the newer standard grafted on to 4G networks, with both types of services co-existing (indeed 4G users are likely to see performance benefits as 5G gains traction and people upgrade their devices to support it).

Telstra today released research it commissioned from Deloitte that, citing figures included in government research released earlier this year, estimated that that the productivity benefits of 5G networks could be worth $32 billion and $50 billion to the Australian economy by 2030.

Although the sheer speeds attainable over 5G have tended to grab headlines – and a live Telstra demonstration at the conference obtained download speeds in excess of 3Gbps over mmWave spectrum – the latency characteristics will potentially have an even more significant impact.

Connections over 3G and 4G typically involve hundreds of milliseconds of latency; 5G can deliver single digit millisecond latency – “even down to one millisecond,” Penn said.

That low latency opens up the potential for a host of new applications, such as remote surgery over a wireless connection or remote driving.

“As we move into a world of automation and robotics, whilst we can put up maybe with that slight annoying delay in relation to communications when it perhaps is voice or perhaps we’re accessing a website, when it comes to things like autonomous driving – that latency starts to become important,” Penn said. “When it comes to robotics it becomes important as well.”

The standard will also boost the capacity of telcos’ mobile networks -- offering 10 times the capacity of previous technologies, at a lower cost per gigabit of data, the Telstra CEO said.

Penn told a media briefing at the conference that although telcos didn’t differentiate 4G pricing from 3G when LTE first launched, it still drove up revenues through higher usage. “I would envisage that would be the same dynamic with 5G – as an industry I don’t think we’re going to suddenly structurally changing the pricing of telecommunications connectivity,” he said.

The CEO said that Telstra was also seeking to create value not just from offering connectivity but from the applications and services enabled by that connectivity – something that he said to date Telstra has done very well on the enterprise side of its business.

“We need to continue to think about how do we achieve that on the small/medium business side and also into consumer as well, and I think there will be opportunities,” Penn said.

The telco has already upgraded its backhaul transmission and core network in preparation for 5G’s debut, the CEO said.

Last month Telstra started progressively declaring its mobile base stations “5G ready” (drawing the ire of rival telco Optus, which noted that there are, as yet, no 5G end user devices on the market).

Telstra’s executive director, network and infrastructure engineering, Channa Seneviratne said that the key element of the base station upgrades was rolling out new radio equipment.

“Because 4G and 5G are co-located, it is all in places that we already have kit,” he told Computerworld. “We have equipment, we have power, we have transmission in most cases.”

Initial 5G applications will rely on spectrum in the 3.6GHz band (and later the 26GHz band). Because of the high frequencies involved, the 5G antennas have a relatively modest form factor.

“So in terms of the upgrade as well a lot of those are not going to cause much impost to us in terms of having to do tower upgrades,” Seneviratne said.

Although Telstra in most cases is able to move relatively quickly when it comes to upgrading base stations, it is seeking the “right pace” to ensure the network is tested and tuned, including the associated software ecosystem, before 5G devices reach users, the Telstra executive said.

The author traveled to Telstra Vantage in Melbourne as a guest of Telstra.