How international standards may impact investme—— Interview with Mario Maniewicz, Director of ITU’s Radiocommunication Bureau



The International Telecommunication Union (ITU) is the United Nation’s specialized agency for information and communication technologies. ITU is driving the development of 5G which is attracting a lot of attention lately. ITU has defined the vision and the technical performance requirements for 5G. “The World Radiocommunication Conference (WRC-19), to be held in November 2019, will identify and allocate globally harmonised spectrum and finalize the 5G technical standards,” said Mario Maniewicz, Director of ITU’s Radiocommunication Bureau. Mr Maniewicz believes that the commercial use of 5G will lead to breakthroughs in the industry, and therefore a variety of factors need to be taken into account when making investments.

Global commercial activities are underway

China Investment: What is the current situation of 5G development around the world?
Mario Maniewicz: 5G is expected to bring together people along with things, data, applications, transport systems and cities in a smart networked communication environment by transporting huge amounts of data much faster, reliably connecting an extremely large number of devices and processing very high volumes of data with minimal delay.

The standardization of IMT-2020 (that is the ITU name used for 5G) technology is well underway. The ITU has defined the vision and the technical performance requirements for IMT-2020. Currently, ITU is in the process of completing sharing and compatibility studies for 11 frequency bands within the range of 24 GHz to 86 GHz, to prepare for the World Radiocommunication Conference to be held in November 2019 (WRC-19). The Conference will decide on the identification and allocation of globally harmonized spectrum for IMT (including IMT-2020) in these millimeter waves.

The ITU preparatory studies carried out over the past four years has resulted in a good degree of consensus on these bands allowing many countries to already allocate some frequency bands for 5G and authorise their operators to make trials and pre-commercial deployment of the technology.

The results of these trials and pre-commercial activities will assist in evaluating the candidate technologies and frequency bands that may be used for 5G. The outcomes of WRC-19 will define the frequencies required for the completion of the 5G standards by 2020, when commercial roll-outs are expected.

China Investment: What are the leading countries in 5G development and what are their experiences?

Mario Maniewicz: As mentioned previously, during the current process of 5G technology development, several countries have been conducting research, experiments and trials.

Examples include government-led 5G initiatives in the UK (central test bed for autonomous vehicles), Europe (EC Horizon 2020 programme) and the Republic of Korea (5G pilot network), as well as commercially-led 5G test beds deployed in Australia (live trial by Telstra and Ericsson), Italy (test of 5G technical performance by Wind Tre and ZTE), Russia (test of 5G usage scenarios by Rostelecom and Nokia), the US (5G trials using wireless backhaul), Japan (by NTTDOCOMO and Huawei) , etc.

Although the trials have tested a range of beamforming technologies, network architectures, download speeds, usage scenarios and use cases (such as augmented reality, virtual reality, smart cities, public safety, healthcare, etc.), it is still early to derive best practices and references.

Key issues to be considered in investment

China Investment: What areas does the ITU think may be the first to make breakthroughs in the commercial use of 5G, in the personal consumer market or industry? Why?

Mario Maniewicz: If a breakthrough can be defined as a major change with significant impact, the commercial use of 5G will cause breakthroughs mainly in the industry.

5G promises to have a disruptive impact on the industry, not only on the business models, but also on the products offered. Indeed, 5G will enable industry automation, mission-critical applications, self-driving cars, smart cities and smart homes/buildings, etc.

In the personal consumer market, 5G will also considerably increase mobile connection speeds, thus enabling 3D videos, UHD screens, gaming in the cloud, augmented reality, etc. This will improve the services already offered today.

From a general perspective, the same 5G network will provide the underlying infrastructure for both the ultra-reliable and low-latency communications and massive machine-type communications that industries will benefit from – and provide for enhanced mobile broadband that will be so important in improving consumer experience.

So, both the industry and personal consumer markets will take advantage of the 5G infrastructure provided by mobile operators (once the supply side is ready to offer the service) at the same time and in different ways.

China Investment: The investment in 5G network construction is huge, and the government needs to consider it carefully when formulating policies. At the government level, what are ITU's recommendations?

Mario Maniewicz: The investment required to deploy 5G networks will indeed be high and, to foster the deployment of 5G, governments may wish to:

1) allocate and license sufficient spectrum for mobile networks in low (below 1 GHz), medium, and high (above 6 GHz) frequency bands, if not yet done;

2) use a technologically neutral approach to allow the migration of 3G and 4G to 5G networks also fostering backward compatibility;

3) define a spectrum roadmap that indicates what spectrum will be available in the foreseeable future;

4) reduce the price of spectrum per MHz, taking into account the low propagation of millimetre waves and the wide spectrum blocks that will be made available above 24 GHz;

5) remove tax burdens and adopt financial incentives for the deployment of high-speed backhaul networks in general and fibre networks where possible;

6) define policies and incentives towards passive infrastructure sharing, including towers, poles, ducts, etc.

China Investment: What are the key issues investors need to focus on if they are to invest in 5G?

Mario Maniewicz: Investors need to consider several issues, besides of course their business plan and strategy. We can classify the aspects investors need to pay attention to as follows:

Government level:

-the economic and political stability of the country where investments will be made;

-the regulatory, legal, and environmental constraints towards building additional sites and ducts, and towards infrastructure sharing;

– incentives, including tax reductions or partial direct governmental investments.

Business level:

-the increase in the average revenue per user (ARPU) by upgrading the existing network to a 5G network;

-the average revenue per machine (or sensor) obtained in the provision of M2M services and applications –or the increase in revenue, in the case the service was already offered using 4G networks;

-the forecasted number of machines that will be connected to a M2M network considering the expansion of IoT applications;

-the cost to deploy additional high-speed backhaul (e.g. fiber network), or the cost to acquire such infrastructure;

-and the frequency bands made available by national regulatory authorities for 5G deployment, the price of spectrum rights acquisition, obligations imposed, the duration of the license, and the conditions for license renewal.

Investing in infrastructure and equipment or in services and applications:
-the players already in the market, new entrants, suppliers and buyers of the service, and the substitute products;

-forecasted demand for the services and applications;

-the legal framework for passive (poles and ducts) and active infrastructure sharing (poles and ducts) – as previously mentioned;

-the use of internationally harmonized frequency bands for IMT, and thus for 5G, reducing equipment costs due to economies of scale;

-the legal framework on data privacy;

-and the development and monetization of services and applications reliant on the availability of 5G infrastructure and network.

Next focus

China Investment:  What role can ITU play in commercial use in 5G, and what priorities will you carry out next?

Mario Maniewicz: ITU is coordinating the international harmonization of additional spectrum for the development of 5G mobile systems and is playing a key role in producing the standards for 5G technologies, which includes the technologies and architectures of both the wireless and the wireline elements of 5G systems.

The spectrum harmonization and the standardization roles are crucial for the development of the 5G ecosystem and for the commercial deployment of 5G systems.

Defining globally harmonized spectrum and standards enables global roaming and provides massive economies of scale – resulting in lower-cost services and equipment usable everywhere.

It must be noted that the detailed technical specifications for International Mobile Telecommunications (IMT, the generic term used by ITU to designate 2G, 3G, 4G, 5G and future generations of mobile broadband services) standards are developed in close collaboration with the leading national, regional and international radio standards development organizations and partnerships.

And the involvement of ITU Member States, equipment providers, network operators, industry fora and academia in this process enables these harmonized standards to be implemented on a worldwide basis.

Thus, the current priority is to globally harmonize additional frequencies for IMT during WRC-19, and to continue the work in the ITU Study Groups to define the band plans and the recommendations for each of those frequencies.

Then it is the role of the Administrations to integrate in their national regulations the decisions taken in the international arena. Low (below 1GHz), medium and high (above 6GHz) frequency bands will be available for Administrations to allocate and license nationally with the aim of making 5G commercially available.

China Investment: How does the ITU view China's development in 5G? Any comments or suggestions?

Mario Maniewicz: Early 5G trials and deployments will serve as inputs to the final 5G specifications that will be concluded by 2020. The ITU welcomes these initiatives as well as China’s contribution towards building the specification of this innovative technology.

Regarding commercial deployment and equipment manufacturing, the adoption of globally harmonized frequency bands by national regulatory authorities will enable Chinese manufacturers to export their 5G equipment and products to the rest of the world. And will ensure a reduction in the service prices offered in the local market.