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    Telcos are barely done rolling out 5G networks — and they’re already talking about ‘5.5G’


    You probably remember mobile operators raving about the promise of 5G several years ago. Now, they’re getting excited about a new upgrade: 5G Advanced.

    Angel Garcia | Bloomberg | Getty Images

    BARCELONA, Spain — Telecom operators haven’t yet finished rolling out 5G wireless mobile networks. And yet bosses of major carriers are already talking about building something called “5.5G,” or “5G Advanced.”

    There was a lot of chatter about 5.5G at the Mobile World Congress tech trade show in Barcelona, Spain.

    MWC brought together thousands of people in the mobile industry, including from leading telecom companies like Deutsche Telekom, Orange, Telefonica, BT, and Vodafone.

    At the show, executives from some of these companies that they were working toward rolling out a new generation of mobile internet.

    That would enable even more advanced applications than the data-intensive apps we’ve all come to use today, such as Facebook, Instagram, YouTube, Netflix, and TikTok.

    These apps are already well served by the current mobile internet, but in the future 5.5G is expected to power more advanced applications.

    That includes mixed reality headsets, which are getting more and more powerful with tech giants like Apple launching its Apple Vision Pro and Meta upgrading with its Meta Quest Pro headset last year.

    But it also means some of the things that 5G promised us years ago, such as self-driving cars, unpiloted air taxis, and smart manufacturing enabled via the so-called internet of things (IoT), will start to become a reality, too.

    What is 5G?

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    5G has been positioned by the telecoms industry not just as a consumer product for faster download speeds, but as a network that could underpin new technologies like driverless cars or unpiloted air taxis.

    That’s because it has lower latency than 4G. That means the time it takes for devices to talk to each other is significantly reduced, a feature important in scenarios where data needs to be delivered quickly.

    However, after hundreds of billions of dollars of investment into 5G networks, carriers have struggled to see the return. Analysts say that the real potential to monetize 5G might be on the horizon.

    What’s ‘5.5G,’ and why are telcos talking about it?

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    Mats Granryd, director general of the GSMA, told CNBC he hopes the industry can continue focusing on staying in a 5G environment for years to come, as there’s still plenty of work to be done on monetization.

    “I hope that we can stay in 5G territory for long, because normally in the 4G environment, you and I were the consumers. And it’s quite quick for us to just say, change a SIM card,” Granryd told CNBC’s Karen Tso. “In 5G, 5G is a technology standard that is predominantly towards business to business. And it takes a longer time for businesses to convert and use new technology.”

    “This normal of 10 years between standards, I wonder if that’s going to be enough,” Granryd added. “We hope that we can stay in a 5G environment. 5G advanced — 5G standalone, that’s absolutely fine. But push out the time and make sure that we have enough mileage to capitalize and monetize and show the world that 5G is a fantastic technology.”

    With 5G Advanced, telecoms firms could start to make more money from their 5G rollouts by charging higher prices. And, with a key focus of 5G being enterprise applications, that could be a much more significant money maker for network operators than consumers.

    Telcos haven’t yet revealed how much more a 5G Advanced data plan will cost compared with 5G. But analysts expect they’ll look to make money from 5G Advanced by getting clever about subscriptions and using AI and other technologies to operate their networks more efficiently.

    With a key focus of 5G being enterprise applications, that could be a much more significant money maker for network operators than consumers.

    The telco industry has been awash with talk about so-called “private 5G” networks, nonpublic mobile networks that are installed on-premise at companies’ work sites for example, in a smart factory, or remote surgery operation.

    When will 5G Advanced be here?

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    Huawei revealed eight 5.5G “innovation practices” last week which it says will help operators build 5.5G networks across all frequency bands. The company is working with carriers in the Middle East, Europe, Asia Pacific, and Latin America to deploy 5.5G.

    It’s going to take some convincing for consumers to go from 5G to 5G Advanced, given the little noticeable improvement they’ve seen from their phones upgrading to 5G in the past five years. But Philip Song, Huawei’s chief marketing officer of the carrier business group, said that it’s important telcos convey the use cases of 5G Advanced to consumers well.

    “The most important thing for us is how can we support the customers,” he said at a press briefing last Tuesday, in response to a CNBC question. The “biggest success” for 5.5G will only arrive if carriers “acknowledge solutions” and bring that across to customers sufficiently.

    In some markets, operators are still working on deploying 4G, Song said — but he doesn’t think that matters because different parts of the world “are at different stages.”

    Watson told CNBC that he thinks 5G Advanced will arrive on the EE network later this year. That’s because the 3GPP standard release 18, or 5.5G, is already open for experimentation and telcos have been working on trials. It is expected to conclude by June 2024, by which time the protocols that enable 5.5G should be stable.

    “Release 18 we will start to roll out this year,” Watson told CNBC. “We also plan to launch 5G standalone this year as well.”

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