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The Business Case for 5G


Spectrum/Charter tested fixed 5G in six U.S. markets while also hinting that it will pursue regulatory changes to keep wireless providers at bay

“I’m cooking dinner tonight. It will have an impact on the world only rivaled by that of the wheel, the domestication of the dog, and the invention of agriculture.” I’d better have a really great recipe.

Because this isn’t an inexpensive venture. Bloomberg’s Olga Kharif and Scott Moritz report that the upgrade to 5G is going to cost carriers, chipmakers, device manufacturers, and software companies approximately $200 billion a year in R&D and CapEx to make good on the huge promises of 5G.

And to their credit, 5G advocates think they do have a very good recipe. “You can transform your workforce. You can be closer to your customers. The real-time will really be there. There’s a lot of industrial companies that are now thinking, "What can we do?” Hans Vestberg, CTO EVP and President of Global Networks at Verizon—and former Ericsson CEO-- told audiences at CES.

A seasoned industry veteran, Vestberg insists that 5G won’t be just another incremental advance in wireless tech. “Being part of designing 2G, 3G, and 4G, they were predominantly consumer technologies with speed and throughput being better every time,” he said. 5G is different, in his opinion, because it’s being built with industries in mind, as well as consumers, and speed and throughput are table stakes. The new technology’s true value will be measured in “new currencies” such as “low latency, security, and multi-connectivity.”

In the same forum, Baidu COO Qi Lu emphasized how 5G will be an essential component in the breakthrough of new technologies, especially AI. “Mobility is the fundamental essence of intelligence,” he said. “It’s why animals have brains and plants don’t. If you need to move you must memorize and generalize.” In his view, 5G and AI go hand-in-hand, with security, edge computing, and more necessary to make AI work, and AI ready to fuel more advanced networks.


But fellow panelist Christiano R. Amon, president of Qualcomm, notes that 5G will be about more than mobility. “What 5G will basically do will make sure that every single connectivity will be wireless, fully convergent, and not only mobile, but basically everywhere,” he said.

That angle is enough to cause heartburn for wired broadband carriers on its face, but a number of cable-cos are also embracing 5G. Spectrum/Charter, for instance, tested fixed 5G in six U.S. markets while also hinting that it will pursue regulatory changes to keep wireless providers at bay.

There is a case to be made, however, that the business case for 5G isn’t quite baked yet. BT head Gavin Patterson made news last November for saying as much at the Huawei Global Mobile Broadband Forum. He noted that there is still work to do on 4G, which still has significant return on investment that has yet to be realized.



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