After years of trials and tests, 5G is finally here in Australia. Telstra and Optus customers in some areas are already using this next-generation mobile technology and Vodafone is not far behind. It is expected to go live by 2020.

With the promise of faster network speeds, lower latency and more simultaneous connections, 5G is expected to transform many industries. It will play a critical role in recasting customer value propositions, accelerating industrial transformation and reinvigorating the digital society. With 5G networks being deployed and rolled out globally, let’s take a moment to understand more about this 5th generation mobile network.

What is 5G?

Well, the name itself suggests – 5G is the next step from 4G with faster speeds and the ability to transmit more data. The estimated potential of 5G speed is anything from 4 to 20 gigabytes per second (in theory). Unlike previous generations (4G and LTE), the 5G network does not work on a single type of technology. It can be called as a ‘network of networks’ that is constantly developing and that encompasses a broad range of devices than merely mobile phones. 5G will bind together existing and future standards by adding new antennas onto establishes cell towers, utility poles and smart buildings. Such physical changes will help build faster connections allowing businesses to deliver their services at competitive rates.

Key features of the 5G network

5G is set to be a game-changer because of the following features:

  • Faster network speeds: As already mentioned, 5G would be much faster than the previous generation of networks. While the exact speed that an individual user can get will depend upon the configuration of the network, the number of connected devices and the user’s device, 5G specifications state that users would get a minimum download speed of 100Mbps.
  • Lower latency: Latency is the time taken for the transfer of information from your phone (or any other device) to the wider internet and back again. The 4G network has a latency of about 60 milliseconds whereas for a 5G network it is reduced to as low as 1 millisecond. This huge decrease in latency will prove to be vital for new technologies where every second is of utmost importance.
  • Greater capacity for simultaneous connections: 5G will allow more devices with high-demand applications to connect to the network at the same time. With new developments in IoT devices, autonomous cars, virtual reality experiences with HD video streaming this high connectivity will gain more importance
  • Reliability: 5G is touted to be ‘ultra-reliable’ with no glitches in connectivity allowing innovative solutions in more critical industries like health care and production, transmission and distribution of energy through smart grids.
  • Flexibility: 5G offers the potential of network slicing – i.e multiple logical networks can be created on top of a common shared physical infrastructure. This end-to-end compartmentalization of the network promotes robustness and flexibility. Each ‘slice’ can be optimised for the needs of the cluster they are defined to serve.

Overall, 5G is credited to be a transformational technology which can pave the way for new paradigms of network operation and service creation. When used in conjunction with artificial intelligence, machine learning and analytics, 5G can offer a range of personalized services across millions of end-points. With the ‘almost’ limitless potential of 5G, let’s have a look at the benefits of this next-generation mobile technology in business.

Benefits of 5G in business

  • Increase in mobile penetration: People are already using more connected devices than ever before. With the onset of 5G, mobile would become a ‘general-purpose technology’ like electricity or cars. This would transform the economy and many related industries.
  • Improve productivity: The Bureau of Communications and Arts Research recently published a paper on the impacts of 5G on the productivity and economic growth of Australia. The working paper argues that 5G technology can improve productivity in 2 main ways. The first is by improving efficiency in production and distribution of existing goods and services. For eg: By using 5G in mobile technology, businesses can better access information while ‘on the go’.The second way in which 5G can impact productivity is by improving the efficiency of new goods and services brought to the market.

  • Remote working: Faster internet speeds and more bandwidth will lead to a distributed workforce for companies. Employees could easily work remotely from home or while travelling through 4K, AR, VR and holographic calls. Companies can also opt to freelance more of their operations.
  • Tailored networks: As mentioned above, 5G will enable network slicing which would allow companies to have their own private networks tailored according to their specific needs. Businesses can effectively monetize the greater capacity offered by 5G network by only using the resource that is necessary for them.  

IMPACT OF 5G ON INDUSTRIES

The capabilities of 5G are set to transform the way business is done across various industries. 5G will be the key for new innovations enabling the performance of mission-critical operations. Following are some industries which 5G will impact the most:

  • Automobile: Transportation systems will gain increased visibility and control due to 5G. It would allow vehicles to communicate with each other thereby avoiding crashes or minimizing damage. The improved connectivity would greatly help self-driving cars. Commercial vehicles could optimise their trucking costs, thus reducing logistics and shipping costs for consumers.
  • Healthcare: 5G has the potential to transform the healthcare industry due to its fast connectivity and low latency than the previous mobile network technologies. 5G can help reduce costs and patient experiences. Digitally-delivered healthcare would gain importance with new technologies. Reliable networks and smart machines would greatly reduce downtimes or breakdowns. 
  • AR/VR: These technologies require massive amounts of data processing. They require a less expensive network with wider bandwidth and lower latency. Thus the future of AR/VR technologies depends upon 5G. 5G could enable widespread adoption and development of these technologies.
  • Financial services: Financial institutions are already undergoing digitalization. 5G would help to accelerate this process. The increased security and speed would allow users to carry out transactions instantly.
  • Retail: Australians are already hooked to online shopping. We spent A$28.6 billion on online shopping last year and 25% of the sales were made through mobile devices. The rise of 4G/LTE has enabled this move to online and mobile shopping. 5G could bring in new experiences for consumers like VR dressing rooms.
  • IoT: Smart devices or ‘Internet of Things’ can get smarter and more useful. Smart devices could have a dedicated bandwidth protocol to easily transmit data amongst themselves. Thus 5G enabled IoT can afford us better safety, security and health at home and work.

While the upsides of 5G are countless, there are also some industries that might be hurt because of it. With 5G enabling impressive experiences for consumers through VR, cinemas and other entertainment venues would face problems. Wired cable and phone companies would face extinction as more people would opt for wireless high-speed connections. 

Challenges of adopting 5G

While business leaders await 5G as a force to reckon with, they are also cautious, since 5G isn’t widely deployed yet. Making firm business plans would take time as 5G is relatively new. It is not clear how quickly this technology would be taken up once it is made available. The productivity benefits of 5G would be seen only after some period of time if it takes longer to build the network and the technology to be adopted by consumers. Some of the challenges to adopting 5G are :

  • The lack of agreed standards for security and privacy of both data and devices.
  • No clarity on the legal and regulatory framework to allow 5G enabled devices and services.
  • Though 5G has shown faster download speeds than 4G, the signal is affected by physical barriers like buildings, walls and distance  
  • Businesses would have to invest heavily in indoor 5G hotspots and backhaul

Way ahead

We should keep in mind that the debut of 5G does not mean instant death for 4G. Since the shift to virtualised platforms is expected to take place gradually and at varying rates, business leaders need to adopt a holistic perspective. All in all, businesses with bigger margins are better positioned to adapt and take advantage of the 5G roll-out since the transition would be expensive. Though operators can invest other complementary technologies like NFV (Network Function Virtualization) and software-defined networks (SDN) to bring about savings, it is better for the smaller players to wait and watch.