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What is 5G and how will it impact business?

After years of research, trials, hype and promise, 5G networks are now arriving around the world. Wireless connectivity has been part of our lives for over two decades, changing the way we interact with each other, and with the world. 5G is promoted as a transformative technology that will change the economy profoundly. But there’s often confusion and misunderstanding over what 5G is. It certainly offers a step-change in performance, but its impact will be greatest in sectors where its characteristics resonate most.

5G will deliver performance improvements and offer new capabilities

A new generation of network technology arrives roughly every 10 years. Mobile networks have evolved from the first networks offering just voice calls to the full broadband experience we have today – we can watch videos on the go, play interactive games in augmented reality and make high quality video calls. 5G will take this even further by offering:

  • enhanced mobile broadband service speeds of over 100Mbps
  • a greater density of devices, with a goal of 1 million devices per square km
  • ultra-low-latency communications, with the goal that data moves across the network in 1ms or less.

The higher speeds, very low latency and greater capacity of 5G will come as no surprise – they’re the obvious bits. But 5G isn’t just about doing the same thing bigger, better and faster. It also promises to strengthen security and control over the network.

5G can create network ‘slices’, each optimised for specific needs such as speed, reliability, encryption and security. Combined with the transformation of network functionality into cloud-based software features, and quality of service enhancements such as prioritisation of different types of traffic, this slicing allows the creation of private networks at low cost, designed to meet the requirements of specific customers.

Providing this granular level of control will be key to unlocking the potential of 5G. It will drive interest and adoption in a way that not only meets sector-specific requirements, but also builds links across sectors to create a series of intertwined ecosystems.

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Key sectors need 5G today

Right from the outset, 5G development focused on providing support for industry. It’s meant to be the answer to questions around high density (either devices or capacity) connectivity and resource-intensive applications.

But 5G isn’t the only game in town for new or evolved services and applications. 4G and other technologies might offer enough functionality. In our view, the need for 5G comes down to the need for two key features:

  • control – is the control that 5G offers necessary for an industry to take up 5G?
  • application intensity – will the applications an industry uses need 5G’s performance improvements?

Our analysis of sectors shows 5G has potential in manufacturing, transport, public safety, healthcare, energy and entertainment. But all sectors could get some added value from 5G.

Organisations must understand how evolving mobile services will reshape their industries

5G coverage will take time to become as widespread as 4G. It took around five years to cover the urban population with 4G, and investment conditions are tougher today. So, 4G will remain the bedrock of mobile networks for several years.

Initial deployments of 5G will be primarily an evolution of existing mobile broadband services, providing additional capacity in areas of highest demand. But they will also put in place the building blocks for the services that are critical to driving penetration across industry.

Over the next two to three years, 5G will evolve to include support for autonomous vehicles, industrial automation, ultra-low latency communications and use of unlicensed spectrum. Organisations need to understand the timing of this evolution and how it will affect the way they work.

But 5G is not the only driver of transformation. To take full advantage of the capabilities of 5G, organisations need to understand how it will interact with big data analytics, robotics and artificial intelligence to reshape their sector.

Contact the authors

Contact the telecommunications team