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Telstra’s 5G Network Is Flaky, So Is Their Business Case For 5G

Serious Questions are being raised about the roll out of Telstra’s 5G service with the carrier set to give free 5G access to its flaky network if you buy a new 5G device now, but after 12 months consumers will sting an additional $15 a month on top of current plans which start at $140 for 50GB of data.

This week I stood metres away from a Telstra 5G tower in Mosman and the fastest speeds I could get from the new Samsung S105G device and the all new LG V50 5G dual screen device was 323.5Mbps, 300 metres from the same tower the speed dropped to 189Mbps.

A week earlier at the roll out of the LG device inside the Telstra Experience Centre in Sydney Telstra executives claimed 5G speeds of over 1250Mbps but despite several tests at several 5G hotspots we were still only able to get 350Mbps speeds which raises the question as ‘Why bother’.

One has to seriously question as to why Telstra is rushing to launch 5G services as they sack over 8,000 staff and slash services.

During a panel session at 5G World, an interesting point was put forward by both PCCW and Telenor who both claimed that if you don’t need 5G, why bother rushing to the finish line?

In the future it will not only be mobile phones putting demand on networks it will be connected objects such as cars and medical devices

PCCW Group CTO Paul Berriman claims that data consumption is increasing, though network like Telstra and Optus and that these carrier networks are not being strained.

Like Vodafone who are waiting on the 5G sidelines Berriman doesn’t feel that compelled to act on a 5G roll out as the business case is yet to present itself.

Telenor who operates in Scandinavia and Asia is taking a similar stance, in the sense it is not being rushed.

Ingeborg Øfsthus, CTO of Telenor Norway, pointed to the tsunami of unknowns. The maturity of the technology is a worry, as is the development of the business cases.

Øfsthus said the team does not have the pull from the verticals to rush a launch, and while there are some interested parties, there would have to be demonstratable scale before they are interested.

Another interesting factor to consider is the disruption to the management of a telco as a business.

The drive towards 5G has been breathless at carriers such as Telstra without a clear business case being revealed, other telcos are waiting for the right conditions before entering the fray; the ‘built it and they will come’ attitude is not being shared by everyone.

“It is early in the cycle, but it is evolving rapidly,” said Channa Seneviratne, Executive Director at Telstra.

Seneviratne suggested Telstra was one of the first companies worldwide to launch 5G, but this was entirely based on circumstance. With 60-70% year-on-year growth on data consumption, Seneviratne couldn’t afford to sit back and wait for the technology to mature or the business case to be fully understood; the demand for capacity-offloading was today.

When Sol Trujillo the former CEO of Telstra rolled out the Companies highly successful 4G network which is still delivering great speeds, he had another curve emerging that pushed his roll out along, smartphones.

Consumers were being seduced to move from old brands such as Nokia, Motorola or Blackberry to a new generation of iPhones, as well as Android devices from HTC and Samsung.

When they bought their new generation smartphone, they got 4K and a big speed improvement.

This is not the case today, smartphone evolution has slowed Apple sales are falling and the speed case Vs Value is going to be a key factor when consumers ask themselves whether they are prepared to pay more for a 5G device which is similar to a 4G device and when they are already getting excellent 4G speeds, as well as Netflix, Foxtel or Stan streaming.

For Telstra their 5G roll out is a high-risk gamble which at this stage is stumbling along in the dark with very questionable claims being made.

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