Korea 5G Falls by Half. Miracle Over?

Korea's 5G net additions were only 313,000, down from over 800,000 in August, Phil Kendall of Strategy Analytics reports. Three months ago, the carriers were confident the pace would continue and that by the end of the year, the total would be over 5 million. In fact, the total was only 4.67 million due to the shortfall at the end of the year.

Phone subsidies have been cut sharply from the $400-600 earlier in the year. Deployment, at over 80%, is the highest in the world but the 90% target for yearend has been missed. The Korean press has been reporting reliability problems, even in Seoul.

5G, as the technical experts have been warning since 2018, is not coming close to the extraordinary hype.

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5G Bringing Back Microwave Backhaul

Andy Sutton, Principal Network Architect at BT, sees millimeter-wave backhaul playing an important role in 5G networks. 90% of GSM networks used microwave for backhaul, but fiber became increasingly important in more recent systems. 

Sutton notes that E-band radios today can deliver 6 gigabits with 99.99% reliability. Recent regulatory changes will increase the spectrum available and data rates. That should be sufficient for most European 5G sites, which are primarily mid-band or low-band.

Verizon's Glenn Wellbrock, Director of Optical Transport Network Architecture, Design, and Planning, also sees an increasing role for wireless backhaul and fronthaul. Fiber is now 90% of Verizon's 5G backhaul, but he sees that microwave may double and backhaul 20% of sites.

Governments are being pressured to provide rule changes and cash for more fiber, because "fiber connectivity is essential."

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19M 5G Phones 2019 Led by Huawei & Samsung

In August 2019, I wrote Almost all 5G estimates for 2019-2020 need to be doubled. Figures for Korea and China were becoming available and were higher than expected. All the pundits were predicting fewer than 10 million phones in 2019. The numbers are now in. 

The 19 million figure is actually a little lower than I expected in October after the Chinese press reported 10 million reservations in October. It may be that people delayed actually buying phones until less expensive models, like the $285 Xiaomi, shipped in January. Alternately, some of the early announcements could have been inflated.

Korea was the first to deploy, pulling up Samsung's sales. As China started buying, Huawei pulled ahead. China is so large Huawei will soon be far ahead. Apple will come in in the fall, probably strong.

2020 estimates over 200 million were well supported but Corona could change that. 

New Coronavirus Already Affecting Telecom

The new coronavirus is already one of the worst infections of our lifetime. Let us hope and pray the massive containment effort is effective. Most of China is on lock down this week and next, with preparations underway in case six more weeks are required. Update Feb 2 NY Times estimates actual cases are over 100,000, with official counts only reflecting severe cases seeking medical attention.

One of the least significant problems of the virus is the effect on our industry. The iPhone and nearly all other phones (except Samsung) are mostly produced in China. Two weeks of production and store closings can be recovered. Six weeks more is could have a severe impact.

Skyworks, which supplies radio frequency parts to nearly every phone manufacturer, just said

To date, we've seen no material impact in our supply chain or with demand signals. However, the situation is evolving. So we've reflected some added risk, as I mentioned, to our March guide, including, as you'll notice, a wider range of outcomes. So to your question, likewise, we're thinking about potential effects into the June quarter. And even though our channels are lean, we are concerned about how this plays out because we just don't know. (Emphasis added.)

 I reported AIDs for two years at the height of the epidemic. So far, the new coronavirus is not at that level.  

But I'm scared.

Enforcing Tower Safety Best Way to Find New Workers

Only one worker died falling from a wireless tower in 2012. That figure was up to eight in 2019. Many more were injured. Tower climbers are among the workers at the highest risk for fatal falls in the workplace. Workplace fatalities in the U.S are three times higher in the U.K.

The danger makes it hard to recruit new workers. DC believes the U.S. needs more trained workers for 5G success. The easiest way to make that happen is to enforce existing OSHA safety standards. Some simple steps: FCC Commissioner Brendan Carr, active in this topic, should meet with an OSHA counterpart and find ways for the FCC to help. I'd suggest

• Add to the FCC website a section on tower safety. OSHA can provide the information and the FCC could add links to training. Training options can easily be found at Wireless Estimator. A yearly press release with data could draw attention.
• Require all parties - telcos, towers, contractors - be responsible for safety. Too often, they just blame others.
• Making sharing networks and radios easier, which reduces the number of towers, cost, and time.

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Blanco: All of the IoT requirements today can be fully satisfied with 4.9G capabilities"

Telefonica CTO Enrique Blanco tells Harry Baldock,

All of the requirements they have today can be fully satisfied with 4.9G capabilities that we have in our network. This means that all the LTE-M and all the IoT requirements we currently have can be delivered using 4.9G. That's in terms of our customers' needs today. But, if you analyze what is going to happen over the next two or three years, in terms of delivering Industry 4.0 initiatives, those needs are going to evolve. We need to be ready. 

Blanco is among the half dozen most respected engineers in world telecom. He's been responsible for hundreds of millions of lines for Telefonica in Spain, England, Germany, and Brazil. He's been working on Edge networks and IoT for several years. He's right some new industrial uses will develop, but I expect limited impact. It's very expensive to retrofit a factory and relatively few new factories are being built. Even if the systems prove out, few factories are likely to be upgraded soon. Enrique is more optimistic and could be right. 

I've been horrified by the false claims about 5G from politicians, pundits, and especially the equipment vendors. At least for years, all large medical, public safety, IoT, and entertainment apps will run fine on any decent 5G LTE network. 5G is good stuff that adds important capacity. Consumers want it, especially as decent phones have fallen in price to $285-450. None of the "brave new world" uses will have much impact for years.

All the "studies" of economic returns from 5G are based on applications said to require 5G. Since most can be performed with 4G, these "studies," especially from Qualcomm, are not worth the electrons they come to us on.

Don't believe the hype.

 

China 5G: 14 Million Phones in 2019

In both November and December, ~5M 5G phones shipped in China. The monthly total is likely to go up quickly, as supplies of lower-priced phones are becoming widespread. In particular, the US$285 Xiaomi phone is now shipping. The December total phone sales were down 14% compared to Dec 2018, which may suggest people were waiting on the availability of less expensive 5G phones.

This is the official figure from the China Academy of Information and Communications Technology, CAICT. It is part of the Ministry of Industry and Information Technology (MIIT.) There have recently been inconsistencies in reports from China. Ten million "reserved" 5G in the first two weeks of October; a senior technical company expert expected they would get phones within a month.

That schedule hasn't been met. The Chinese press reported some supply shortages. Some people may have delayed purchasing phones as announcements were made of lower prices soon to come. I may have misunderstood press reports, which I read in Google translation. Some numbers could have been exaggerated. 

China Mobile expects to sell ~100M 5G phones in 2020. China Telecom plans 60M. That's more than the official Chinese projection of a total of 150M in 2020, although China Unicom has not yet estimated publicly. I'll be watching closely to get accurate figures.

Equinix/Packet Deal Bringing Cloud Everywhere

Zac Smith of Packet recently introduced me to an entire market I hadn't realized existed: the massive "private clouds" being built by company after company. I had assumed most cloud needs would be well served by the giants, Amazon, Google, ... They have the scale to keep prices low and tens of thousands of engineers ensuring their technology is better than almost everyone else.

Packet is doing very well and has strong products and a growing customer base. Equinix, a $50 billion company, presumably paid a generous price. Equinix's P/E ratio of ~100 requires rapid and profitable growth. Packet can deliver that, initially by serving Equinix's existing customer base.

Packet can deploy private networks for Equinix clients in weeks across a dozen data centers worldwide. Perhaps more interesting is Packet's ability to extend Equinix from the data center to inside carrier networks, towers, and ultimately customer sites. All of that is part of today's Edge design, also called a hybrid cloud. Packet is already there.

Zac is selling "bare metal servers" in large numbers to companies that had particular needs or security concerns the big outfits couldn't meet. Call Packet, and in days or weeks you can have 100's of Linux servers installed almost anywhere in the developed world, ready to go and well configured with software. More