5G has become a major focus at this year’s MWC. Some people argue that while 5G may be slower on the road, it will never be late. Despite the U.S. blocking Huawei from its market, the company is still expected to lead the charge in the 5G revolution.
On February 27th, after a year of intense testing, wireless carriers finally set a timeline for large-scale 5G deployment. From the U.S. to Asia, many companies are preparing to launch 5G services, which could begin as early as this year. At this year’s MWC, 5G was definitely the highlight.
While the timeline sounds exciting, there are serious challenges behind the scenes. Looking ahead to the 5G services expected this year, most of them fall far short of what operators promised. The goal? To make wireless connections as fast and reliable as wired broadband. However, plans from AT&T, Verizon, Australia’s Optus, and Finland’s Elisa Oyj are either very limited or just one part of the ongoing 5G standardization process.
The "fixed-line wireless" service launching this year is promising. It uses an outdoor antenna to deliver broadband directly into homes without cables. But initially, the internet speed isn’t that impressive.
Why is the rollout so slow? A big reason is infrastructure. Unlike previous network upgrades, 5G requires installing a massive number of small cell antennas—many of which are not yet in place. Even once installed, cable companies must send new radio signals across city streets, which takes time.
Countries like Australia, China, Finland, Japan, and South Korea are testing 5G, with operators claiming 2019 as the launch year. Yet, the reality is much more distant than the ambitious plans suggest.
Professor Ted Rappaport from New York University's Tandon School of Engineering believes that for 5G to be truly practical, manufacturers must invest heavily in the market. Only when smartphones and other devices come equipped with compatible chips can "fixed-line wireless" become a reality.
Michael Murphy, Nokia’s North American technology director, says it’s hard to predict which devices will adopt 5G until chip costs drop. He also notes that no clear "killer app" for 5G has emerged yet.
Verizon started early, testing 5G in 11 U.S. cities and planning to roll it out in Sacramento. But even they admit that full mobile services will take years. AT&T claims it will launch both fixed and mobile 5G before 2018, starting with mobile hotspots for laptops.
Huawei’s Position
Although the U.S. has closed its doors to Huawei, the company has already partnered with major operators in Europe and Asia and is seen as a potential leader in the 5G revolution.
China is expected to be the largest 5G market, and Huawei holds a strong position there. Additionally, the company is expanding globally, competing with Ericsson and Nokia in key markets, including some that are U.S. allies.
Currently, 5G networks are still in beta, using dense arrays of small antennas to transmit data up to 50 or even 100 times faster than 4G. While building a full 5G network may take another year, Huawei has already taken steps by signing 25 memorandums of understanding (MoUs) with operators to test 5G equipment. These MoUs could lead to commercial contracts, with partners including British BT, Canadian Bell, French Orange, German Deutsche Telekom, and Vodafone.
Despite this, Huawei still lags slightly behind Ericsson, which has signed 38 MoUs, and Nokia, with 31. These figures only include public deals, leaving room for undisclosed agreements.
However, Huawei has built long-term relationships with operators, which could give it an edge. As of 2016, Huawei provided equipment for over half of the world’s 4G networks, and for nearly two-thirds of the 4.5G networks.
Dell'Oro analyst Stefan Pongratz noted: “Existing network business is crucial because operators want to maintain their old systems. Using the same supplier helps save money.â€
In China, Huawei has a significant advantage. For example, one-third of China Mobile’s 5G network contract will go to Huawei, another third to ZTE, and the rest will be open to foreign competitors.
According to GSMA data, by 2025, 1.2 billion people worldwide will use 5G, with one-third coming from China.
Huawei’s Risks
Is there any risk for Huawei? Of course. Like its competitors, Huawei has invested heavily in 5G research, but whether operators will adopt these technologies remains uncertain.
Some well-funded operators are patient, waiting for mass consumer and enterprise adoption before investing in 5G. In emerging markets, where 4G is still not widespread, 5G adoption could be delayed by at least a decade.
Looking at the global scene, Huawei is three times the size of Nokia and Ericsson. Last year, it reported $92 billion in revenue, with half coming from China. In the last quarter, it held 32% of the mobile wireless access device market, compared to 30% for Ericsson and 25% for Nokia.
In recent years, Ericsson has faced financial pressure and has had to cut costs, while Nokia is busy integrating acquisitions.
Nokia claims confidence in its 5G product portfolio, offering both software and services. Ericsson highlights its long-term customer relationships and advanced 5G patents, saying it has a strong position in the competition. An Ericsson spokesperson added, “Our customers are all looking at 5G.â€
Huawei has also signed non-binding agreements with major telecom operators in South Korea, Japan, Australia, Italy, Turkey, and Saudi Arabia. Setting aside commercial interests, these agreements show that many countries, despite being U.S. allies, do not view Washington’s security concerns as absolute.
The U.S. has accused Huawei of providing insecure equipment. Huawei responded: “In 170 countries, Huawei products are trusted by governments and customers. Compared to other providers, our products have no higher cybersecurity risks.â€
Bruce Rodin, vice president of Bell’s wireless network in Canada, revealed that his company hired external security firms to rigorously test Huawei products and found no issues. He said, “We’ve been testing for nearly 10 years and haven’t seen any malicious code or backdoors.†He believes the U.S. is acting out of business protection.
Deutsche Telekom stated that it has worked with Huawei at multiple levels and found no security risks. A spokesperson said, “The hardware is manufactured according to our requirements and checked by our security team.†Orange treats Huawei like any other supplier.
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