Despite the efforts of the European Commission, and the EU sponsored 5G Public Private Partnership (5GPPP), the initial large rollout of 5G networks will not happen in the old continent, but in markets such as China and the US, then in several Asian countries such as Japan and South Korea, and then finally in Europe.
This new reality for the European 5G adoption was shared by the CEOs of Nokia and Ericsson during the press conferences that both companies recently held in Barcelona for the Mobile World Congress 2018.
During their press event on Sunday, Nokia’s CEO Rajeev Suri argued that North America and China will roll out 5G networks first because they have stronger consumer demand, and higher revenue per user. According to Suri the average American mobile user pays three times more to the carriers than the European users. That means that telecoms in the region will be ready to invest in new networks as they can leverage the expense with higher revenue from users waiting to jump into the 5G bandwagon.
Ericsson CEO Börje Ekholm, during the company’s press conference on Monday, was more specific, blaming the European ecosystem. He mentioned several barriers for 5G in Europe, including strict privacy regulations, net neutrality rules and, most importantly, fragmented spectrum in the hands of regulators of each member state.
“Europe has a couple of issues to resolve: the stability of regulations, the availability of spectrum, and other specific European issues, including data privacy laws across Europe. Those issues will need to be resolved here in order to capture the potential of 5G,” Ekholm said.
Then Ekholm was more specific about net neutrality. He argued that all traffic is not equal, and networks should be able to prioritize critical data, but not discriminate against the same type of content.
Ekholm says that the initial 5G deployment in the US will be made by carriers to provide high-speed broadband to underserved areas, where connecting customers by fiber is not realistic. 5G, with is gigabit speeds and low-latency can provide fiber-like experience to customers that are just getting DSL speeds right now.
“North America first use case will be on fix-wireless access, and they are pursuing that aggressively with the high-band. China is more focused on the industrial internet: what can we do in factory automation, logistics chains, what the factory of the future actually looks like,” he continued.
European carriers are not looking for those wireless solutions since Fiber-to-the-Home (FTTH) is well deployed in most cities, including small ones, and there is much larger penetration of fixed-wire broadband.
Nokia’s CEO Suri believes the first 5G users, both in North America and Asia, will be consumers looking for the high-speed experience. “The first 5G rollouts in 2019 and 2020 will be on consumer business cases, such as video, AR, VR, etc. and then, in a second phase, industrial applications: robots, factory automation, connected cars, etc.,” he said.
While there are differences in the user cases of early adopters around the world it is clear that Europeans will have to wait a bit longer to enjoy the speed, low latency, and reliability of 5G networks.