Everything directors need to know about 5G

The 5G mobile network is the next big thing in technology, bringing high speed internet connections to smart devices. Here's the lowdown on what your board needs to know.

What is 5G?

The term 5G is shorthand for the fifth generation of mobile networks, continuing the lineage from the first generation (1G) of mobiles that simply made phones portable, through 3G and 4G that expanded to mobile internet connections.

In reality, while 5G is a step up to new bandwidths, ongoing upgrades mean networks are already operating on 4.9G. However, the shift to 5G heralds important changes that boards need to consider.

What does 5G do?

5G networks promise low latency (an extremely fast response to commands with minimal delay), large bandwidth capacities, improved network reliability and the ability to connect to a large number of devices simultaneously. At a basic level, 5G can deliver speeds up to 100 times faster than 4G and can connect with up to 1000 times more devices per metre.

This technology promises lots of connected, smart devices from autonomous vehicles (or V2X — “vehicle-to-everything” — a car’s communication system); the potential mass-market use of virtual and augmented-reality devices; remote surgical procedures; and real-time monitoring of smart water sensors. At a consumer level, the introduction of 5G is set to supersize mobile broadband download/upload speeds. Optus claims it has reached a peak 5G speed of 295Mbps, and average speeds of 100Mbps.

Is 5G a technological game changer?

Beyond all the hype around speeds, a key difference between 4G and 5G is “network slicing”, which is the separation of multiple virtual networks, which operate on the same physical hardware for different applications, services or purposes. While still in its infancy, network slicing enables companies and public organisations to use a dedicated private channel for more stable and reliable end-to-end communications. It could mean supply chain companies can own a dedicated channel to control all their autonomous vehicles, fulfilment centres and payment processing.

Another way in which 5G is different to 4G is its ability to perform “edge computing”, which basically brings the collection, analysis and processing of data closer to its point of use.

For example, in 2019, the Commonwealth Bank undertook a pilot with telecommunications companies Ericsson and Telstra that would allow the bank to simplify its network operations and provide more flexibility around bank operations and locations.

When will the 5G network be ready?

Coverage of 5G is being rolled out slowly in major Australian cities and selected sites. The three major holders of current 5G bandwidth — Telstra, Optus and a joint venture between Vodafone and TPG — have started rolling out their networks. However, legal action between TPG, Vodafone and the Australian Competition and Consumer Commission, is having a delaying impact.

Additionally, the number of cells (or bases) required for similar penetration of 5G signals is around 10 times that for 4G, meaning huge infrastructure spends and many location issues that need to be resolved. Most experts believe widespread coverage of 5G is still three to five years away.

Moreover, many devices at a consumer level are only 4G-enabled, so these will need to be upgraded along with any enterprise devices that require keying into the networks. Apple’s latest iPhone, for example, was released without 5G capabilities.

However, businesses should be looking beyond consumer applications of 5G and actively understanding how its enterprise capabilities can be integrated into their short-term and medium-term planning.