In 2020, the sudden outbreak of COVID-19 is having a major impact on mobile operators planning to launch 5G services. The rapid spread of the epidemic continues to disrupt the global economy and may further intensify. There is no indication that the epidemic will be in the short term. end within. According to Strategy Analytics forecasts, smartphone sales will drop by 21% this year (although it will recover well in 2021), which will also affect the number of users upgrading to 5G terminals. Nonetheless, there are many positive signs in 2020 that 5G still has a lot of growth potential, including its ability to respond to the outbreak.
5G networks continue to grow
According to Strategy Analytics, operators have released 15 5G commercial networks since the beginning of 2020. Beginning in late February, Thailand AIS, Hong Kong HKT, Hong Kong China Mobile and Japan NTT DoCoMo, KDDI and Softbank have all released new 5G networks, despite the increasing impact of the new crown epidemic. In addition, Rakuten Mobile also released a new 5G plan before the summer.
At the same time, operators around the world are continuing to expand their 5G networks. In China, the government is using infrastructure projects to offset the economic impact of the epidemic, and 5G is one of the core infrastructure. China Mobile plans to deploy 300,000 5G base stations by the end of 2020, while China Telecom and China Unicom have also proposed a goal of deploying 250,000 base stations in their 5G co-construction and shared network by September 2020. In the U.S., 5G investment plans also remain strong, with Verizon ramping up CAPEX spending in 2020, with Fitch Ratings noting, “Despite a challenging economic environment, there should be ample cash flow to support the planned 5G budget and support Wider 5G service rollout later this year.” While some operators in lockdown countries have prioritized network maintenance goals over network upgrades, 5G deployments are still underway and operators need to be prepared In response to the rise in 5G terminal sales in the second half of 2020.
To cope with the more than 40% increase in fixed broadband traffic caused by home office, distance education and other services, operators have increased their investment in backhaul networks. The backhaul network accounts for nearly a quarter of the cost of 5G deployment, and these investments to enhance the backhaul network will greatly simplify and accelerate 5G deployment.
5G terminal ecosystem continues to expand
The cancellation of MWC2020 did not affect the launch momentum of smartphones in the first half of 2020. Although it is still uncertain whether sub-$200 5G smartphones will be available in the Chinese market by the end of 2020, a series of affordable 5G terminals worldwide are still uncertain. Releases have been very encouraging, including the $340 Huawei Honor 30S, the $380 Xiaomi Mi 10 Lite, the $380 Vivo S6 5G, the $490 TCL 10 5G, and two new 5G devices from Samsung. Phones, the $500 Galaxy A51 5G and the $600 Galaxy 751 5G. The emergence of more affordable 5G smartphones is still a key factor affecting medium-term 5G construction goals, although operators also have to consider network expectations for the launch of the 5G iPhone and Samsung Galaxy Note 20 in the second half of 2020.
5G has positively contributed to the response to the COVID-19 pandemic
The COVID-19 pandemic has had a profound impact on the healthcare and public services of countries around the world. Hospitals and healthcare providers must adapt to new ways of working and equipment in hours or days, not weeks or months. And businesses, employees, teachers and students have adapted to online services such as online communication, distance education and distance entertainment.
As we all know, in order to fight the new crown epidemic, China has built the Huoshenshan and Leishenshan hospitals in Wuhan. Operators need to quickly provide broadband networks to the hospitals. Compared with optical fibers, 5G has the advantage of rapid deployment. China Mobile, China Telecom and China Unicom have all provided network services for the two hospitals, in addition to the basic “emergency” network, 5G robots are also provided to reduce exposure risks, and Neolix’s driverless vehicles are used for temperature monitoring, spray disinfection And medical supplies distribution, using 5G cloud collaboration tools to provide CT scans, X-ray inspections, and online consultation services through high-definition video.
5G has played a role in improving broadband network performance in communities as work and education moved online during the lockdown. This role is most evident in the field of education, where high-quality home broadband networks have become especially important in rural and underdeveloped areas due to the lack of regular school attendance. In China, the Ministry of Industry and Information Technology has again asked operators to expand 4G and 5G coverage to support online education. In the US, Ericsson has partnered with the Vermont Telephone Company to deploy 4G and 5G networks and provide modems and routers to homes, providing students with free high-speed Wi-Fi access. Inseego’s data shows continued growth in sales of its flagship 4G and 5G MiFi, while operators are offering 5G FWA services at discounted prices: Rain in South Africa offers unlimited 5G for R699 (~$38) per month Home services prompted a doubling of weekly demand, while Saudi Zain’s low-cost 5G plans also boosted demand by 25%.
Can 5G Speed Economic Recovery?
We have noted that the Chinese government hopes that China’s three major operators will accelerate the pace of 5G deployment and are committed to promoting economic growth through infrastructure construction. China’s Ministry of Industry and Information Technology issued a policy to encourage local governments to open up public buildings and utilities for operators to build 5G base stations. The government will also work with grid companies to reduce the cost of electricity for 5G networks. After the Hungarian government completed the spectrum auction in March, it is also eager to complete the early deployment of 5G in some key areas, such as hospitals, universities and major transportation lines, to help the society cope with the health crisis. Obviously, the Hungarian government has recognized that 5G will be used this time. will play an important role in the economic recovery after the crisis.
On the first anniversary of South Korea’s 5G commercialization, a strategy committee of 12 government departments outlined what they see as the important role 5G will play in leading the economic recovery in the wake of the Covid-19 pandemic. While the government is encouraging South Korean companies to continuously increase their participation in the global 5G market, it also hopes that South Korean operators will continue to improve 5G coverage domestically, and these operators have reduced their investment budgets for the first half of 2020 from 2.7 trillion won (approximately KRW 2.7 trillion). $2.3 billion) to 4 trillion won ($3.3 billion), which includes indoor coverage in more than 2,000 locations. The Korean government has fully recognized the importance of stimulating the economy through the creation of new markets and the transformation and upgrading of traditional industries through 5G, and has focused on smart factories, smart cities, digital healthcare, autonomous vehicles and 5G V2X and unmanned vehicles in 2020. machine development.
In a report titled “5G and its Impact on Enterprise Digital Transformation,” Strategy Analytics states, “5G is a core component required to create a virtualized, agile, software-defined, and user-experience-responsive IT environment for enterprises. “. The COVID-19 pandemic that is sweeping the world is by no means an “opportunity”, but it is prompting many businesses to accelerate their digital transformation process, and 5G will undoubtedly play an important role in it.