2020 was the year that telecommunications proved to be the foundation for the modern society. It was also the year that fifth generation (5G) technology deployment was shown to be on track.
This is according to research and consulting firm, Strand Consult, which reviews the highs and lows of the mobile telecoms industry in 2020 and makes predictions for 2021.
As the world, and South Africa, witnesses ramped-up efforts to roll-out the next-generation of cellular network technology, the Danish ICT research firm says it is “cautiously optimistic” for 5G in 2021.
“Operators can excel building and running networks – even during a crisis. The question is whether the applications for 5G will prove compelling for consumer adoption.”
Strand Consult says while some operators stubbornly stuck with Chinese equipment, others moved forward to rip and replace Huawei equipment without increasing cost or slowing their timeline to 5G.
The firm references Denmark’s TDC, Norway’s Telenor, and Telia and Proximus in Belgium among the successful reboots. “Operators are replacing and upgrading their networks at a pace that exceeds the implementation of 3G and 4G. It is impressive to see how quickly new equipment can be deployed; it took TDC just 11 months to launch a 5G network with non-Chinese equipment covering 90% of the country.”
Staying with China, Strand predicts that opting out of Huawei equipment and other “risky technology” vendors will become a unique selling point for operators in 2021, particularly for corporate customers.
It took [Denmark's] TDC just 11 months to launch a 5G network with non-Chinese equipment covering 90% of the country.
Strand Consult
Chinese telecommunication giant Huawei found itself in the middle of a trade war between China and the US – the world's two biggest economic powers.
In 2019, the US Department of Commerce placed Huawei on an export blacklist, citing “national security threats” due to the company’s close ties to the Chinese government. Huawei has vehemently denied installing any backdoors in its networking equipment for alleged government spying.
As the US-China trade dispute intensified, some Western nations sided with the US, including the UK government, which decided to have Huawei equipment removed from the UK’s 5G networks by the end of 2027.
According to Strand, by investing for the future, private network providers ended up prepared for the unexpected.
“The COVID-19 brought unprecedented challenges to telecommunications networks, and these networks performed to meet pandemic requirements. During lockdown and the new normal of working from home, people have relied on these networks for work, school, shopping and healthcare.
“By investing for the future, many network owners ensured that networks would perform under worst case scenarios. This outstanding network performance disproved the conventional regulatory wisdom that network owners left to their own devices would harm their customers, their networks and third-party service providers.
“Indeed, the opposite happened; not only did network providers provide consistent service, many reduced prices in solidarity with their customers. This experience has important implications for price control regulation, investment incentives and sustainability.”
In addition, Strand says the love/hate relationship in the time of corona was between regulators and platforms like Google and Apple for their track and trace apps.
“While antitrust efforts against these large players have been ongoing globally, COVID-19 suddenly gave them a central position as ‘the good guys’, which surveillance people actually want. Competition authorities put a lot of effort into high antitrust cases against the hyper giants; some of these will likely fail.
“A better strategy to reduce their dominance would be to stop making policy which unfairly favours and strengthens these platforms with free giveaways on radio frequencies (unlicensed spectrum), copyright (fair use), and data transmission (net neutrality) and so on.”
Sky is the limit
Turning to spectrum auctions, the ICT research firm states the auction for the C-Band (3.7GHz-3.98GHz) in the US is on track to set a world record for a spectrum auction, breaking $70 billion.
The excitement, it says, rivals the 3G spectrum auctions in 2000 and reflects that American operators can purchase rights without expiration.
In SA, the Independent Communications Authority of South Africa (ICASA) is preparing to auction spectrum at the end of March.
“In a mere generation, spectrum auctions have demonstrated telecoms operators’ ability to use scarce resources efficiently and to contribute significantly to the public treasury,” says Strand. “As the Royal Academy rightly observes, market-based allocation methods like auctions are preferable to administrative allocation.
“However, not all spectrum auctions have been beneficial. Indeed, high prices in some countries have reduced infrastructure investment. In some cases, governments and bidders have gamed the auctions.”
Strand Consult advises that governments around the world should improve the practice of spectrum allocation, particularly as applied to auction rules, spectrum repurposing, unlicensed spectrum and federal spectrum holdings.
Fibre in the air
Strand predicts that 2021 will see increasing substitution of 4G and 5G/FWA solutions for fixed broadband connections.
“While consumers are increasingly cutting the cord and going all wireless for broadband, many policymakers and advocates have resisted accepting this trend.
“They want to perpetuate outdated regulatory silos. Meanwhile, mobile operators will join forces with fibre-to-the-home providers and offer broadband through fixed wireless access. Larger operators with a fixed and a mobile business will rely on these solutions to supplement fixed broadband.”
On security, Strand points out the most common cyber attacks come from organised crime and state-sponsored actors for financial and espionage reasons.
“This year [2020] was no different than others for the large-scale cyber attacks. This policy failing reflects the lack of a holistic approach to network security and frequently an over focus on software.
“2021 should see a greater focus on all network elements and their provenance, including the servers which process data and the laptops and devices connected to them.”
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