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Local 5G subscribers to top 11m in four years

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A new study says although 5G is in its infancy in SA, it could see 11 million subscribers and 43% population coverage in the next four years.

This, the report says, represents significant growth from the estimated 90 000 subscribers and 4.4% population coverage at the end of 2020.

The SA 5G Market Outlook report by research firm Africa Analysis says cautious spectrum management is critical to enable high-speed, good-quality broadband connectivity, which will form the foundation for a subsequent range of home applications.

The report indicates the rollout of 5G in SA is likely to be one of the most significant technology events of this year and beyond.

The 5G Market Outlook report has been published just ahead of the high-demand spectrum auction planned by the Independent Communications Authority of South Africa (ICASA) for the end of March.

Spectrum in SA is due to be issued in three main bands: 700-800MHz, referred to as low-frequency bands, and high-frequency spectrum across the 2.3GHz-2.6GHz and 3.5GHz bands.

ICASA also plans to license the wireless open access network (WOAN) around the same time.

MTN, Telkom impediment

Africa Analysis warns of massive consequences if the auction is stalled further, citing lawsuits instituted against ICASA by Telkom and MTN as potential hindrances.

“Both operators, who have submitted applications to participate in the spectrum auction, are not happy with aspects of the auction process,” says Africa Analysis.

MTN filed an application in the Gauteng High Court to declare unlawful, and to review, correct or set aside two decisions made by ICASA which relate to the spectrum auction process.

In December, Telkom filed an urgent court application saying it considers the regulator’s decisions to be irregular and unlawful.

For MTN, its concerns include ICASA’s decision to implement an auction structure that creates two categories of mobile operators, namely Tier 1 and Tier 2, and the use of an opt-in auction round in which Tier 1 operators will not be allowed to participate.

MTN’s biggest worry is that of alleged ambiguities surrounding the Tier 1 and Tier 2 classification, which ultimately leads to the exclusion of Tier 1 operators from participating in the opt-in round for portfolios 1 and 2.

Similarly, Telkom says, the first fundamental flaw made by ICASA is that the auction ITA involves the auction of portions of spectrum in the 703-733MHz paired with 758-788MHz (the 700MHz) and the 791-821MHz paired with 832-862MHz (the 800MHz) frequency bands, which it argues are not immediately available for use on a national basis by a licensee that may ultimately succeed in its bid during the auction process.

Emergence of use cases

Further, according to the report, 5G is expected to continue building on the 4G (LTE) services but will enable a far broader range of use cases and new technologies.

“It will even enable the use of robots to perform an array of tasks presently performed by humans – something we have been reading about in science fiction novels for decades.

“5G will use different spectrum frequencies for different infrastructure deployment, which will serve different purposes when it comes to use cases in the business, consumer and public spheres.”

It says the key drivers of 5G services uptake will be: “requisite spectrum assignment, low-cost smartphones and other devices, prepaid offering and network roaming.

“The existing operators have entered into strategic roaming agreements with each other. Additionally, the WOAN will drive competition in the market through the provision of wholesale services to retail service providers.”

The enterprise market, according to the report, is expected to be the main driver of the more sophisticated use cases, with 5G enabling technologies such as the Internet of things (IOT) to real-time analytics, artificial intelligence and augmented / virtual reality.

“IOT will see significant growth on the back of 5G across different vertical sectors. Mining, manufacturing, agriculture, utilities (energy and water) will be some of the first and main verticals to implement it extensively for process automation and better resource management.”

It notes that to achieve the intended uptake, the operators that end up having additional spectrum licensed (including the WOAN) are expected to invest heavily in network infrastructure, both in further 4G and 5G rollout.

“Spectrum in the 3.5GHz frequencies, to be assigned later this year, will see the most use for 5G deployment over the next five years, with close to 30 000 5G sites being commissioned. This will also account for most of the population coverage.

“The remaining sites will be built using the 700MHz and 800MHz frequencies (although this will mainly see 4G deployment) and the high-band frequencies, from 26GHz and 28GHz upwards (currently held by some operators in the market).”

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