Expensive 28GHz Investment... Significant Long-Term Effects

GSMA, Economics of mmWave 5G - Total Cost of Ownership Assessment by 2025

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Eunmo Koo] Investment in ultra-high frequency (millimeter wave) bands, such as the challenging-to-deploy 28 gigahertz (GHz) band for mobile communications, is evaluated to have a high cost-effectiveness from a long-term perspective in perfectly establishing a 5G environment.

According to the related industry on the 13th, mobile data traffic has surged recently due to digital transformation in industrial sites, automobiles, robots, and medical sectors. To handle this, 5G, which is 10 times faster than LTE but has one-tenth the latency, is essential. Ericsson projected that mobile data traffic will grow by 30% annually from 2019 to 2025.

As 5G demand increases, the necessity to secure wide bandwidth frequencies has grown, and interest in ultra-high frequency bands with abundant available bandwidth has also risen. There is no band comparable to ultra-high frequency bands in terms of capacity and bandwidth. Because ultra-high frequency has a large spectrum, it can solve high-speed, low-latency, and high-capacity issues, and its short wavelength allows the use of very small antennas, which addresses beamforming problems and improves coverage and spectrum efficiency.

Despite the increased interest in ultra-high frequency, activation has been difficult due to the characteristics of the waves. Ultra-high frequency waves have strong directivity and less diffraction (the property of waves bending), resulting in shorter travel distances and vulnerability to obstacles compared to low-frequency bands. Consequently, coverage is relatively narrow; for example, the 28 GHz band covers only about 10-15% of the area covered by the 3.5 GHz band.

Despite these technical challenges, investment in ultra-high frequency is analyzed to be effective from a long-term perspective because the areas where ultra-high frequency spectrum can be used are gradually increasing. According to the GSMA’s report “The Economics of mmWave 5G,” as of October last year, only ten countries, including the United States, Korea, and Japan, had allocated ultra-high frequency spectrum for 5G, but recently, various countries such as Australia and Malaysia have announced plans to allocate frequencies in the ultra-high frequency band.

GSMA analyzed that as the available spectrum increases, new bands for mobile services will provide the necessary capacity or coverage, complementing existing bands, so the number of countries allocating ultra-high frequency spectrum is expected to continue increasing in the future.

The expansion of ultra-high frequency 5G device adoption is also encouraging. The price of 5G devices has started to decline as economies of scale are realized and the number of device suppliers increases. The greatest effect lies in the standardization of core smartphone components. As production scales up and design teams shrink, initial costs decrease. GSMA forecasts that over 100 consumer ultra-high frequency devices and about 50 fixed wireless access (FWA) routers (CPE) will be released this year.

The price of ultra-high frequency network equipment is also falling. Currently, ultra-high frequency wireless infrastructure is more expensive than existing low-band and mid-band equipment because it is the latest technology and equipment manufacturers have not yet achieved economies of scale in production. However, GSMA expects the cost gap between sub-6 GHz equipment and ultra-high frequency equipment to continuously narrow over the next few years.

This content was produced with the assistance of AI translation services.