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Foggy 5G Forecasts Coming into Focus

Foggy 5G Forecasts Coming into Focus
by Roger C. Lanctot on 11-27-2016 at 12:00 pm

 My colleague and automotive safety system guru at Strategy Analytics, Ian Riches, is fond of citing Amara’s Law. Named for Roy Amara (1925-2007), research, scientist, forecaster and long-term president of the Institute for the Future, the “Law” states: “We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run.”

The reverse may be true of 5G wireless technology. A lot of observers appear to be underestimating the short-term impact of 5G and exaggerating the long-term as if to say: “Yeah, 5G is going to be awesome, but it’ll be a decade before it has an impact.”

Some of these 5G deniers are sandbagging the latest evolution of cellular technology because they are heavily invested in current generation LTE technology or they have a horse in the race to connect cars to each other in the form of 802.11p dedicated short-range communication technology. I understand the lack of enthusiasm for 5G among LTE enthusiasts, but I can’t abide the doubting Thomas’ from the DSRC camp.

Hopefully all involved got a wake-up call last week from Ericsson which decreed that standardized 5G networks will be operational by 2020 with 25% of all North American subscriptions on 5G by 2022. Ericsson has no interest in exaggeration. It isn’t good for business. If Ericsson says 5G is knocking on the door, I’m letting 5G in … to my head, to my pocket and, sooner than most think, to my car.

Still, there is the problem of the short-term. Amara’s Law was Amara’s way of noting that analysts are prone to hyping new technologies while underestimating the amount of time it may take to incubate a new technology to bring it to full maturity. Of course, researchers and analysts have a powerful interest in hyping the short-term prospects: the bigger the hype, the more likely market reports are to be snapped up by willing clients.

But clients aren’t being naive in buying reports with over-hyped forecasts. Companies seeking funding or seeking to be acquired might well want to purchase a report that paints a rosy picture of prospects for a particular market, technology, company or industry. How else are they going to get the attention of potential customers, investors or their boards of directors?

5G wireless technology has become a little like fully automated cars. Nearly every day some new study is forecasting an earlier than previously anticipated arrival of fully autonomous cars, while some respected expert is claiming full automation is decades away.

With 19 automated fleets already plying controlled-use areas I am inclined to buy the early onset assessment of automation vs. the over-the-horizon outlook from skeptics. Even my colleague, Ian, has bumped up his short-term AND long-term outlook for all levels of vehicle automation.

The same holds true for 5G. But there is a separate scenario within the cellular industry, where generational transitions can, indeed, take many years to complete.

Disagreement among wireless experts can influence implementation outcomes. The resulting confusion threatens to impede the adoption of new technologies as car makers, in particular, may cling to more familiar solutions.

In the case of 5G, forecasts of distant vs. near-term adoption have given some auto makers pause in their planning for implementing embedded connections. Why bother with LTE, the thinking goes, if 5G is just around the corner. Conversely, an equally valid thought process might be: “Best to put in LTE now, because 5G adoption is so far off.” It all depends on what you believe.

The crazy reality is that both viewpoints are accurate. 5G cellular technology is much closer to market implementation and adoption than most people believe, but that adoption will be spotty and regional, even if it is rapid. The good news is that 5G is an evolution of existing LTE technology so the transition should be less jarring than previous generational shifts.

SOURCE: Ericsson “Mobility Report” 11-2016
Most interesting of all as far as 5G is concerned is the involvement of the automotive industry in setting and testing the standard. For the first time auto makers and wireless carriers are actually seeking common ground around the creation of the new standard. In fact, the priorities of auto makers are in the forefront as the use cases are particularly suited to safety and smart city applications.

Is 5G technology a decade away? I think not. Ericsson has described the rationale behind its perspective in the just-released “Mobility Report.”

Ericsson “Mobility Report” –

In fact, Ericsson has a heavyweight partner in bringing this optimistic outlook to fruition: Huawei Technologies. I am attending Huawei’s Mobile Broadband Forum this week. The future looks bright indeed from the 16th floor of the New Otani Makuhari hotel and the automotive industry is an important part of that future – for the first time.

Roger C. Lanctot is Associate Director in the Global Automotive Practice at Strategy Analytics. More details about Strategy Analytics can be found here:

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