5G Battle Looms, Retailers To Benefit As Telstra & Optus Square Off
5G is set to be a boom for consumer electronics retailers, as Telstra and Optus go head to head in a battle to win over customers.
Telstra is tipped to launch their new network in the first half of 2019 with further updates due this week. On Friday Optus rushed out an announcement claiming that they will also begin to deploy deploying 5G fixed-wireless internet to metropolitan areas in 2019.
The upgrade to 5G, which refers to the fifth generation of mobile networks, will mean faster uploads and downloads and better support for devices, simultaneously.
The first set of standards for 5G were approved in December by 3GPP, the governing body that oversees industrywide standards for telecoms. Carriers such as Telstra and Optus are currently staging their rollout of 5G with 2018 set to be dominated by periodic announcements by both Telstra and Optus who are heading for a bitter fight as both Companies look to revitalise their mobile operations that are currently under pressure due to a slowdown in handset sales.
At CES, Cristiano R. Amon, president of semiconductor and telecom company Qualcomm, predicted that the flagship mobile phones will be introduced as early as the beginning of 2019 and may be showcased at next year’s CES.
Later this month several brands are set to show new 5G models at Mobile World Congress in Barcelona.
Telstra is set to demonstrate 5G this week which they claim will mean much more than higher speeds for our smartphones.
The upgrade to download and upload speed will be substantial, but the real factor in how 5G will change industries and innovation is the major reduction in latency, which will ensure that connections stay strong, consistent and without interruption.
NBN Co, has dismissed the threat of next-generation mobile to its business model following the Optus announcement on Friday.
The Optus’ announcement was seen by some, as a “spoiler” for the Telstra event on the Gold Coast on Wednesday, where it is expected to give more concrete details of its 5G strategy.
Telstra will run extensive 5G trials on the Gold Coast during the Commonwealth Games in April, and the company’s group managing director of networks, Mike Wright, said that the carrier expected to be offering 5G services next year.
“As Andy Penn flagged at CES last month, 2018 will be a big year for 5G and Telstra’s preparations for 5G are already well progressed,” Mr Wright said.
“We’ve already conducted Australian and world-first 5G trials and have been investing in our network to lay the groundwork for 5G. We expect to be offering 5G services in 2019.”
Last year Optus said that they were moving to invest $1 billion to upgrade its regional mobile network, after the Australian Competition and Consumer Commission ruled that neither Telstra nor Optus would be required to share their regional networks with rivals like Vodafone or TPG.
Analysts believe that Telstra will have a 5G network up and running ahead of Optus and that it will reach more people than the planned Optus network which was a problem for Optus when Telstra rolled out their 4G network.
Optus’ announcement on Friday, made no mention of when its customers could expect their phones to start operating on the faster 5G networks, instead trumpeting a product that could shape as a challenge to NBN Co’s network if it provides customers with generous enough data plans.
Telecommunications analyst Paul Budde told the Financial Review, 5G represented a threat to NBN’s market share, particularly in the segment of the market that purchased lower-priced monthly internet plans.
“The sweet spot for 5G is indeed at the bottom end of the broadband market, the group of customers that don’t download movies every night and have a relatively moderate broadband use,” Mr Budde said in a blog post.
“Theoretically at least, this is where 5G will be able to deliver a similar or better performance than the NBN at a competitive price. Optus will most certainly make this as attractive as possible by bundling 5G products with their existing mobile service.”
NBN spokesman Tony Brown said the amount of data consumed by home broadband users meant it was unlikely that mobile rivals would be able to offer plans that were generous enough to compete.
It is understood that performance of fixed-wireless broadband is also significantly less reliable than fixed-line services like fibre to the node, premise or kerb. Over 200,000 customers are already on the portion of the NBN that is served by fixed wireless, which represents an uptake of 40 per cent of the potential market, and complaints about congestion have increased significantly as more customers have joined the network.
“Whilst future 5G services are likely to deliver very high speeds, they will find it hard to deliver the kind of data allowances to consumers that are available from retailers delivering services to end-users on the NBN network,” Mr Brown said.
“At present, NBN end-user premises are already downloading a monthly average of close to 200GB per month compared to the average mobile download of below 3GB per month on mobile handsets.”