With the first set of 5G mobile communications standards slated to be released by 3GPP by the end of 2017, global telecom players are gearing up for deployments, but in a cautious manner, according to industry sources.
The sources said that most telecom firms are quite conservative about building new independent 5G networks, and prefer to gradually upgrade their existing 4G LTE networks to secure stable development.
To meet the actual needs of telecom players, the upcoming 3GPP 5G standards will be dedicated to the operations of non-independent communications networks, the sources said. As a result, unlike 3G and 4G mobile communications which were rolled out as independent networks, 5G is very likely to become the first next-generation mobile network technology to start with non-independent networks, according to industry insiders.
Most telecom players expect 5G to be gradually commercialized starting 2020, but they will struggle to match some of the visions for 5G applications on their current networks, as 4G LTE networks are different from the core networks of 5G, industry insiders said.
Installing 5G components instead of independent networks
To play it safe, telecom firms would rather continue developing telecom services based on their existing 4G LTE networks and gradually install 5G network components, instead of investing heavily to build independent 5G networks.
This is not ideal for telecom equipment suppliers, who despite their major presence in 3GPP, have no choice but to support the formulation of standards for non-independent 5G networks given the lingering weak telecom equipment buying sentiment over the past year. Equipment suppliers will still benefit from purchases of some 5G systems and components by telecom firms looking to upgrade their telecom services, insiders said.
The weak sentiment of telecom firms to establish independent 5G networks mainly results from their failure to determine clear profit sources from 5G operations so far, although the market prospects for 5G look so bright.
With the commercialization of 5G mobile telecom services drawing near, telecom firms will enjoy increases in the number of service users and in the value of application services. Whether they will move to invest heavily in 5G infrastructure in the near future will hinge largely on the size of these increases, the insiders said.
