In Business Model, Internet Access, Mobile, Spectrum

Most forecasts have initial 5G revenue having the greatest scale in just a few countries, including China, the United States, Japan and South Korea.

What is not so clear is the role 5G-based fixed wireless will play in countries outside North America. In the United States and Canada, most homes have access to two facilities-based suppliers of fixed network services, and in a growing number of U.S. cases, three fixed network suppliers for internet access and video entertainment.

That has dramatic impact on the business case for consumer internet access. A fixed network internet access supplier generally has to assume that about half of the total investment in gigabit to home access facilities will be stranded (there is no revenue generated by about half the locations passed).

But that also means the economics of 5G-based fixed wireless access are significantly better, if only because stranded investment is so much less. That is why Verizon and AT&T, for example, are pushing hard to get pre-5G, then standards-based 5G fixed wireless into commercial deployment.

Driven by early commercial rollouts by Verizon Communications and AT&T in the United States, 5G-based FWA subscriptions are expected to account for $1 billion in service revenue by the end of 2019 alone, argues SNS Telecom.

The market is further expected to grow at a compound annual growth rate  of approximately 84 percent between 2019 and 2025, eventually accounting for more than $40 billion, SNS Telecom predicts.

One might argue that the number of mobile phone accounts using 5G is the single-biggest bucket of 5G network accounts, and that likely will be the case. But 5G accounts largely are a substitute for 4G, so there is little–if any–incremental new revenue.

In most cases, 5G-based fixed wireless will represent new accounts and incremental revenue. And even if internet of things eventually grows, as a new services contributor, that might take a decade or more.

AT&T is expanding its fixed wireless 5G trials to business and residential customers in Waco, Texas; Kalamazoo, Michigan; and South Bend, Indiana by the end of 2017, after tests launched in Austin in June 2017.

In tests so far, AT&T has seen speeds up to 1 Gigabit per second and latency rates well under 10 milliseconds for the radio link at customer trial locations in Austin.

AT&T expects commercial equipment to be available within six months of the completion of the 5G Release 15 standard. In contrast, LTE equipment wasn’t available for a year to 18 months after the LTE standard was complete, says AT&T.

In 5G Evolution metros AT&T has upgraded cell towers with network upgrades that include LTE Advanced technologies like 256 QAM, 4×4 MIMO, and three-way carrier aggregation.

By the end of 2017, AT&T expects to deploy LTE-License Assisted Access and four-way carrier aggregation in certain areas of 5G Evolution metros.

AT&T recently tested LTE-LAA technology in San Francisco where peak speeds of more than 750 Mbps were obtained.

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