Ahead of the 2024 Mobile World Congress (MWC) in Shanghai, David Wang, Executive Director of the Board and Chairman of the ICT Infrastructure Managing Board at Huawei, delivered a compelling presentation that underscored the profound impact of 5G-A (5G-Advanced) on the global telecommunications endeavors.
Recently, 3GPP Rel-18, which was the first standardized version of 5G-A, was officially frozen in Shanghai, marking a milestone in the development of the 5G industry. Wang's discourse not only outlined technological advancements but a visionary roadmap for the transformative potential of 5G in the years ahead.
A Historic Milestone: 5G-A Takes Center Stage
The standardization of 5G-A represents a leap forward in mobile communications, setting the stage for enhanced capabilities and broader deployment across global networks. With over 320 5G network services worldwide serving 1.8 billion users, 5G has established itself as the fastest-growing mobile technology, surpassing the adoption rate of its predecessor, 4G, by a considerable margin.
Furthermore, 5G FWA is now the standard option for operators; more than half of the networks are using 5G FWA for commercial purposes. When it comes to the business sector, the first wave of markets has attained success through rapid user migration. In fact, 20% of 5G users account for 30% of mobile traffic and 40% of mobile service revenue.
Reflecting on China's trajectory in the wireless communications sector, Wang noted the nation's rapid progression from 3G to 5G leadership, “China has developed rapidly at a pace of almost five years a generation. In January 2009, China's 3G license was issued. Five years later, LTE TDD and LTE FDD licensed were issued in December 2013 and February 2015, respectively. Also five years later, 5G licenses were issued in June 2019, and now, [in] June 2024, 5G has reached its fifth anniversary.”
Wang reiterated that on the road to 2030, the entire industry needs to continue to improve 5G-A technologies, work on establishing strong development of the 5G industry, maintain 5G’s momentum, and fully achieve its transformative societal impact.
At the outset of 5G's emergence, the telecommunications industry hailed it as a transformative force, proclaiming that "4G changes life and 5G changes society." 5G builds on the capabilities of 4G to better serve consumers. Notably, 5GtoB applications have already made initial progress in various industries, yet more development is required to ensure multi-industry success in the future.
5G-A has emerged as the definitive path for the industry. Built on continuous technological evolution and enhanced capabilities, 5G-A not only safeguards existing investments but also presents new business opportunities, expanding the boundaries of what's possible in telecommunications.
Business Opportunities Driven by the Emergence of 5G-A
In examining the business prospects driven by 5G-A, Wang delved into three core scenarios: toC, toH, and toB.
Addressing toC, Wang noted that although the mobile internet sector has seen a reduction in traffic growth domestically, slowing to 15% in the last two years, there are specific reasons for this trend:
- The user penetration rate of 5G packages reached 80% by the end of 2023. In the future, traffic growth due to 5G user migration will not be significant.
- The OTT bit rate is continuously reduced. For example, the bit rate of Douyin in 2023 was reduced by 27% compared to 2022.
- Mobile internet users' usage time has peaked, stabilizing at 160 hours per month.
Despite these trends, new avenues of growth have emerged through the rapid progression of artificial intelligence (AI). Wang emphasized this point by expounding that AI has evolved over the past year or two, bringing three significant changes: the shift from user-generated content (UGC) to AI-generated content (AIGC), resulting in higher bit rates; an increase in interaction duration, extending from touch to multi-form natural interactions such as voice and video, potentially boosting mobile phone usage from 5.3 to 9 hours daily; and the expansion of mobile terminals from traditional phones to various AI smart devices, with AI mobile phones expected to become standard and their shipment proportion rising from 11% in 2024 to 90% in 2030.
Commenting on toH, Wang noted that beyond China, 5G-A is poised to revolutionize the home broadband scene, managing the user experience in three stages: number provisioning, use, and maintenance.
Wang continued this analysis, highlighting that the toH scenario presents a significant business opportunity outside China’s borders, where 5G-A will enable Fixed Wireless Access (FWA) to deliver fiber-like home broadband experiences. While 4G-era FWA provided supplementary 20 Mbps rates and 5G-era FWA offered over 100 Mbps, 5G-A will guarantee 300-500 Mbps, making FWA a mainstream choice. By 2026, it's predicted that 70% of 5G operators will commercialize FWA, offering diverse services like home security and smart home features, and aligning Average Revenue Per User (ARPU) with optical fibers.
Addressing toB, Wang mentioned that the advancements of 5G-A will enable millions of new industrial connections and services. Previously, the development of 5G IoT was hindered by two major challenges: the high cost and scalability issues of terminals, and the need for an active power supply, which restricted high-density deployments. 5G-A's RedCap and Passive-IoT technologies address these issues.
Passive-IoT offers a 100-meter coverage area, 10 times more than RFID, with labeling costs under 1 RMB, and includes location services. Notably, potential connections could reach 100 billion. Huawei has already conducted technical verifications in the manufacturing and logistics industries in partnership with selected carriers, affirming the readiness of 5G-A to transform industrial operations across various sectors.
In the automotive sector, Currently, China ships 10 million new energy vehicles annually, with each using about 15 GB of 5G data. As these vehicles advance towards smart driving, data usage can reach 100 GB, creating opportunities for operators to monetize through cloud computing services.
2024: The Inaugural Year of 5G-A Commercial Use
As Huawei celebrates the fifth anniversary of 5G commercialization and the freezing of the 5G-A standard, the company looks forward to collaborating with global partners to realize the full potential of this transformative technology.
In his closing remarks, Wang highlighted that over 30 global operators have verified technical solutions, encompassing advancements like 3CC CA, massive MIMO (ELAA-MM), and RedCap. The ecosystem boasts more than 20 5G-A-compatible mobile phones and over 60 commercial RedCap terminals, with a projected 50% increase in terminals by year-end. This launch heralds new opportunities across the toC, toH, and toB sectors
By leveraging 5G-A's capabilities, Huawei aims to redefine the role of mobile networks in the intelligent era, solidifying its position as a pioneer in shaping the future of telecommunications.
Wang's presentation at the Day 0 Summit not only celebrated a milestone technological achievement but also galvanized stakeholders to embrace the limitless possibilities of 5G-A. As the world prepares for the next phase of connectivity, Huawei remains at the forefront, driving innovation and setting benchmarks for the industry to follow.
By Clarissa Garcia, Journalist of Telecom Review Group
