The evolutionary revolution

Why do we need to upgrade to 5G mobile networks?

If you have a working internet connection, you will have seen a barrage of headlines in the past month about Huawei and the 5th generation of mobile communication. If you are like most people, you will have been wondering: Why should I take a break from scrolling Instagram, listening to Spotify, and mining Bitcoin to pay attention to all this? Do I really need more than what my current, 4G-connected devices already provide?

So, what will we get with 5G? Quite frankly, we don’t know yet. That’s part of the challenge of implementing the new service.

We do know the technical capabilities that 5G will have. The International Telecommunication Union published the performance requirements for next generation communications, and the agency sees a 10 to 100-fold improvement over 4G technology. For example, the number of devices that can connect to a network within a square kilometre should increase from 100 000 to one million. That translates to one device per square metre. Peak data speeds should increase to 20 gigabytes per second. Network energy efficiency, measured in terms of energy consumption per unit of data transferred, should also improve 100-fold, greatly mitigating the impact that growth in mobile traffic could have on the environment.

Mobile internet access based on 5G is expected to be significantly faster. However, for the majority of people enjoying 4G service on their phones, the prospect of streaming a YouTube video even more quickly doesn’t evoke much enthusiasm.

But 5G’s superior performance will have another, even more important, effect. It will remove the physical limitations of current mobile networks, which constrain developers’ creativity when creating new applications. The question is: what services will emerge? The telecom industry and public entities, notably in Europe, are making a big effort to stimulate innovative services by letting industry experts test out trial networks, but so far the experimentation hasn’t resulted in a “killer application” with the potential to move the financial needle.

While virtual reality, augmented reality, the internet of things and even connected cars are already possible at some level, the industry expects 5G’s greater performance to finally unlock their true game-changing potential.

One of the most promising new fields explored is the tactile internet. The tactile internet refers to the carefully monitoring of minute movements of your body to allow you to control physical objects at a distance, while providing real time sensory feedback. Think telesurgery, or robots controlled remotely by moving joysticks, pushing buttons, or even by your own gestures. This takes us to ultra-reliable, low-latency communication. We can only control objects remotely through our own movements and receive credible feedback mimicking physical contact with the object if the mobile signal reaches that object and provides feedback to us in something close to real-time. The time that it takes for a wireless signal to travel through a network is called latency, and it is another parameter of 5G that will improve tenfold, to one millisecond.

Another feature of 5G, “network slicing,” will enable networks to give priority to services requiring real-time reaction while continuing to manage normal services, like watching YouTube videos. This feature would allow the network to identify telesurgery traffic, for example, and direct that traffic to a “slice” consisting of a “fast track” path. While network slicing is an essential feature of 5G, it seems to go against the principle of network neutrality, which in a strict sense means that all traffic has to be treated equally. Network neutrality is mandated by the EU’s Open Internet Regulation. This regulation however, has made an effort to account for specialised services that may require higher performance, although these services should not affect general access to the internet. It will be interesting to see, as 5G emerges, how the sector and regulators balance the need to develop new applications with net neutrality.

In essence, 5G networks, with their high speed, capacity, low latency and the capability to manage billions of devices of different kinds at the same time, have the potential to become the nervous system of society and the economy, collecting all the world’s data in real-time. While this is a great opportunity, the risks of misusing or tracking personal data are also higher. 5G will include stronger cybersecurity features to minimise the exposure, but the historic trend of hacking ever more secure systems is naturally causing concerns.

When we will be able to enjoy 5G’s disruptive applications? Not immediately. Some operators are already announcing 5G services and smartphone makers are planning to release 5G-compatbile handsets this year. However, the new services and devices will just deliver a faster mobile connection, not the type of innovative applications discussed. For that sort of innovation, we will have to wait a bit longer, at least three to four years, provided app developers get creative and come up with new, revolutionary ideas.

From the operators’ point of view, 5G’s introduction is likely to be evolutionary, not revolutionary. Operators will start by upgrading the software in equipment installed in the last couple of years to increase the capacity of their 4G services. In one sense, we could say that some operators have “dormant” 5G networks waiting to be activated. Initially, apart from seeing the “5G” logo on our smartphone screens, we will not notice a big difference. Eventually, operators will be able to add new, more advanced antennas -- in many cases on the same towers they were already using for 4G. At that point, the increase in speed will start to be more noticeable. All of this will probably happen in the next two years or so in most European cities. At a later stage, the operators will also update their core, or the “brain” that controls the network, installing new equipment that will allow them to deliver whatever new services have been invented by then.

Migrating to 5G will not be cheap, but the potential benefits for society are worth it. For our part, the EIB is financing telecom leaders to help make 5G’s promises a reality.  Last year, the Bank approved loans of EUR 500 million to Ericsson and Nokia for the development of 5G network products and we are starting to finance some early 5G network deployments.