1、Realising 5Gs full potential: Setting policies for success March 2020 Copyright 2020 GSMA The GSMA represents the interests of mobile operators worldwide, uniting more than 750 operators with over 350 companies in the broader mobile ecosystem, including handset and device makers, software companies,

2、 equipment providers and internet companies, as well as organisations in adjacent industry sectors. The GSMA also produces the industry-leading MWC events held annually in Barcelona, Los Angeles and Shanghai, as well as the Mobile 360 Series of regional conferences. For more information, please visi

3、t the GSMA corporate website at Follow the GSMA on Twitter: GSMA Boston Consulting Group (BCG) is a global management consulting firm and the worlds leading advisor on business strategy. We partner with clients from the private, public, and not-for-profit sectors in all regions to identify their hig

4、hest-value opportunities, address their most critical challenges, and transform their enterprises. Our customized approach combines deep insight into the dynamics of companies and markets with close collaboration at all levels of the client organization. This ensures that our clients achieve sustain

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6、ntroduction4 Progress So Far 6 Realising the Full 5G Vision 12 Overcoming the Challenges 20 Modernising the Policy Framework 26 How Fast? How Soon? 32 1 REALISING 5GS FULL POTENTIAL: SETTING POLICIES FOR SUCCESS Contents 2 REALISING 5GS FULL POTENTIAL: SETTING POLICIES FOR SUCCESS Executive Summary

7、The transition to 5G mobile technology is here. Telecom operators around the world are rolling out networks. But while early indications show lots of momentum, further investments in network capabilities are required to establish the ubiquity, reliability, throughput, and latency that will unlock th

8、e full value of 5G. As things stand today, these investments will likely be deferred until there are tangible signs that the revenue growth required to sustain necessary capex levels can be achieved. The industry, its customers, and society could miss out on substantial economic and social value. RE

9、ALISING 5GS FULL POTENTIAL: SETTING POLICIES FOR SUCCESS There has been a lot of progress, but it is uneven. Auctions for 5G spectrum are well underway globally. But operators have focused their available capital on investments that promise the largest and quickest returns and that protect and stren

10、gthen their core businesses, typically pursuing deployments in the 3 GHz spectrum band in cities combined with coverage deployments in lower spectrum bands. Consumers so far are receptive. The frontrunner in global 5G deployment, South Korea, is on track to reach 12 million 5G subscribers in 2020 an

11、d 36 millionor 90% penetrationby 2026. All three major South Korean operators also have reversed declining average-revenue-per-user trends. But, just about everywhere, the business case contains multiple challenges. The major hurdles are the monetisation of 5G investments for operators and ensuring

12、sufficient infrastructure investment and deployment to meet the full 5G vision for both B2B and B2C uses. At the moment, the lack of clear ROI for operators hinders the case for the infrastructure investment necessary to accelerate full 5G deployment. To quantify the amount of additional 5G investme

13、nts a typical operator needs to make, BCG ran simulations using its proprietary geo-based simulation software and representative network operator data. The 5G base case assumes capital expenditures are primarily driven by the need for capacity extension from increasing traffic. In subsequent scenari

14、os, we factor in the addition of key infrastructure components required to further boost capacity, extend 5G coverage, reduce latency, and increase reliability to full 5G levels. For the base case, our simulations show that capex can be kept roughly at pre-5G levels, requiring only about a 10% incre

15、ase between now and 2027. When we add the requirements of the incremental scenarios, however, we found that enabling the full 5G vision will require approximately 2.4 times the capital expenditures of the base case over the course of the simulation period. Mobile network operators need to both tap n

16、ew sources of revenue growth and optimise their cost structure to meet the substantial increase in investment required to bring the full socio-economic vision for 5G to life. Operators need to think more innovatively about how they build a B2C case for their 5G offerings. They also have multiple opp

17、ortunities to identify promising B2B verticals and find partners that can help deliver high-value, data-centric products or services to be distributed over the 5G network As the industry explores opportunities for creating new revenue streams and optimising infrastructure, policy makers and regulato

18、rs must also play a critical role in unlocking the potential of 5G. Striking a balance between incentivising competition with keeping prices low for consumers and supporting industry investment in next generation infrastructure is critical. In many markets, current policy and regulations still inhib

19、it investment in advanced mobile infrastructure. While we have seen material progress in many areas in the last few years, a continuation of the current pace of regulatory change will not enable the industry to realise the 5G vision. In the past, we have identified six regulatory levers that can fos

20、ter infrastructure investment: making additional affordable spectrum available, facilitating access to site locations, enabling small cell deployment, facilitating deployment of backhaul, permitting the freedom to establish network sharing agreements, and harmonizing power density limits. Government

21、s around the world have taken concerted steps in most of these. But they will need to do more to stimulate full 5G deployment. There are also two additional areas in which action by policy makers and regulators can spur the rollout of 5G: providing adequate subsidies for deployments, and providing r

22、egulatory flexibility for vertical partnerships. Seizing the full macroeconomic opportunity of 5G requires concerted commitments from policy makers and the industry in all of these areas. 3 4 REALISING 5GS FULL POTENTIAL: SETTING POLICIES FOR SUCCESS Introduction Network operators around the world a

23、re rolling out 5G networks. A new era of high data rates, massive connectivity and ultra-low latency, enabling everything from remote health care to autonomous driving to the Internet of Things (IoT), is here. REALISING 5GS FULL POTENTIAL: SETTING POLICIES FOR SUCCESS Thats the promise. The facts po

24、int to a more uncertain future. While early indications show lots of momentum, further investments in network capabilities are required to meet the needs of ubiquity, reliability, throughput, and latency required to unlock the full value of 5G. New network infrastructure can so far be found mainly i

25、n major cities. Few B2C or B2B uses have gained significant traction. Despite continuing progress, further actions are required to accelerate 5G deployments. 5G technology promises vast socio-economic benefits. Leaders from all parts of the digital ecosystemnetwork operators and vendors, technology

26、firms, and policy makershave long heralded the potential. Ultra-low latency and high reliability will provide dramatic improvement in user experience for consumers, entirely new businesses built on IoT, and new life-saving capabilitieseven remote robotic surgery. It is likely that 5G will lead to en

27、tirely new uses that we cannot envision today. A recent report by the GSMA and TMG estimates the total economic impact of 5G on global GDP could reach $2.2 trillion by 2034.1 Against this backdrop, BCG has undertaken an analysis for the GSMA, including the current state of 5G deployment and the path

28、 for the future. The clear conclusion: while progress to date is encouraging and offers several lessons, further incentives and actions are required to accelerate mobile industry investments in 5G infrastructure. Current indications are that network operators will hold to their current capital expen

29、diture trajectories, which support continued traffic growth at the same revenue levels. Investments to deliver the full 5G vision will likely be deferred until there are tangible signs that the revenue growth required to sustain such capex levels can be achieved. The industry, its customers, and soc

30、iety could miss out on substantial economic and social value. This risk can either be increased or mitigated with specific policy and regulatory moves. In this report, we examine the requirements to capture the full value of high-quality mobile connectivity promised by 5G and how to accelerate netwo

31、rk investments within appropriately adjusted regulatory frameworks and policies. We hope this will help industry leaders and policy makers to surmount the hurdles and accelerate the rollout of 5G for the benefit of consumers, businesses, and countries worldwide. 5 1. Source: 6 REALISING 5GS FULL POT

32、ENTIAL: SETTING POLICIES FOR SUCCESS Progress So Far The transition from 4G to 5G is well underway and picking up speed. In fact, the 5G revolution is happening faster than the transition to any previous access technology. Operators around the world are investing in spectrum and next-generation mobi

33、le network infrastructure. (See Exhibit 1.) At the time of writing this report, 348 operators in 119 countries have made some sort of investment in 5G, 77 operators have deployed 5G technology in their networks and 49 have launched a commercial service compliant with the 3GPP standard.2 5G INVESTMEN

34、T AND LAUNCHES AROUND THE WORLD AS OF DECEMBER 2019 EXHIBIT 1 2. Source: GSA, January 2020, “5G Market Snapshot - January 2020” Launched 5G Actively deploying 5G Investing in 5G tests and trials Spectrum and Infrastructure REALISING 5GS FULL POTENTIAL: SETTING POLICIES FOR SUCCESS Auctions for 5G sp

35、ectrum are well underway globally. (See Exhibit 2.) The early focus in most countries has been on the 3 GHz band, but in somemost notably the USoperators are rolling out 5G using mmWave spectrum. The bands in this range getting the most interest are 26, 28 and 40 GHz. 7 COMPLETED, ONGOING AND PLANNE

36、D SPECTRUM AUCTIONS (AS OF DECEMBER 2019) EXHIBIT 2 EMEA AMERICAS ASIA 20020 COMPLETEDPLANNED Ireland Czech Republic Slovakia Finland Italy Spain Italy Latvia Oman UAE UK Qatar Germany Switzerland Austria Saudi Arabia South Korea JapanAustralia China Singapore USCanada IsraelHungary Norwa

37、y Greece Estonia Luxembourg Poland Czech Republic Romania France Slovenia Portugal Bulgaria Netherlands Sweden Belgium UK MexicoUS New Zealand Thailand Hong- Kong India BrazilPeruEcuador Source: “Roadmap for C-band spectrum in ASEAN” GSMA; Press search 8 REALISING 5GS FULL POTENTIAL: SETTING POLICIE

38、S FOR SUCCESS Operators have focused their available capital on investments that promise the largest and quickest returns, and that protect and strengthen their core businesses. Operators are typically pursuing deployments in 3 GHz spectrum in cities, which they combine with coverage deployments in

39、lower spectrum bands. In some geographic regions and markets, operators are offering fixed wireless access (FWA). In metropolitan areas and data consumption hotspots (such as malls, train stations, and airports), operators are densifying networks with both macro and small cells. T-Mobile US, for exa

40、mple, has recently covered much of Manhattan with 5G small cells. (See Exhibit 3.) The availability of large amounts of bandwidth in new spectrum bands (predominantly the 3 GHz band in Europe and Asia, and mmWave in the US) allows operators to provide higher throughputs and lower latency, resulting

41、in outstanding user experience. Because of the challenging radio propagation properties of higher frequency bands, however, these bands are being deployed only to a limited extent outside of metropolitan areas. For suburban and rural 5G deployments, operators typically leverage lower frequency bands

42、 and use techniques such as dynamic spectrum sharing (DSS) to achieve a wider 5G footprint. With DSS, operators can quickly achieve broad 5G outdoor and indoor coverage at relatively low cost. In Switzerland, for example, Swisscom achieved 90% population coverage with 5G by the end of 2019. LEFT: EX

43、AMPLE FOR DENSIFICATION OF METROPOLITAN AREAS WITH HIGH-BANDWIDTH HIGH- FREQUENCY SPECTRUM5G COVERAGE WITH MMWAVE (28 GHZ) BY T-MOBILE IN NEW YORK CITYS MANHATTAN BOROUGH.3 RIGHT: SWISSCOMS REPORTED 5G COVERAGE IN SWITZERLAND ACHIEVED WITH DSS.4 EXHIBIT 3 3. Source: https:/www.t- 4. Source: https:/s

44、cmplc.begasoft.ch/plcapp/pages/gis/netzabdeckung.jsf REALISING 5GS FULL POTENTIAL: SETTING POLICIES FOR SUCCESS 9 Consumers so far are receptive. In South Korea, one of the first nations to launch 5G, the number of subscribers to 5G plans reached 4 million in October 2019, only six months after comm

45、ercial launch. GSMA Intelligence expects 5G to attract 200 million connections in North America (46% of the total) by 2025. In China, Japan, and South Korea, 5G connections will account for more than 40% of the total. In Europe about 30% of connections will be to 5G networks.5 A maturing device ecos

46、ystem will help drive 5G adoption. In a recent study in South Korea, approximately one third of all respondents cited the bundling of 5G to a specific device as the main reason for them to sign up for a 5G plan.6 In 2019, after two years of stagnation, the global smartphone market is growing again,

47、partially driven by the advent of 5G.7 The number of 5G devices on the market jumped more than fivefold from 35 (including 10 smartphones) to 199 (63 smartphones) from March to December 2019.8 In 2020, when Apple is expected to launch its first 5G device, total shipments are expected to reach 160 mi

48、llion units. By 2024, there should be more than 1 billion 5G mobile devices in circulation.9 The Early Consumer Response 5. Source: The Mobile Economy North America 2019, GSMA, 2019 6. Source: 5G user study conducted by Doitsurvey research company in June 2019 7.Source: 8. Source: GSA, December 2019

49、, “5G Device Ecosystem December 2019” 9. Sources: report/documents/2019/emr-november-2019.pdf Operators are adopting three types of market propositions with their early 5G launches. In order to demonstrate the value of 5G subscriptions with high data allowances and large throughputs, some operators are bundling their plans with exclusive content, ranging from exclusive videos, movies, and games to live sports and augmented reality. In South Korea, for example, all three major operators (SK Telekom, KT, and LG U+) offer access to certain content, su