In August 2020, mere weeks after 3GPP’s release 16 was frozen, T-Mobile USA, the Un-carrier, has claimed to be the first telco in the world to deploy a commercial 5G standalone (5G SA) network on a nationwide basis. This claims to put the operator months ahead of its rivals in the US and around the world who earmarked 2020 as the beginning of their 5G core rollout, and grants significant kudos to its core network vendors, Cisco and Nokia, and RAN partners, Ericsson and Nokia (again), for their support.
The 5G core may be here, but not for all
What sets T-Mobile’s announcement apart from other recent announcements—including Vodafone UK’s setup of a small 5G SA network at Coventry University—is the scale. According to the US National Advertising Division (NAD), a carrier can claim nationwide network coverage when they reach over 200 million people, about 60% of the US population. T-Mobile claims with the transition to SA it now reaches 250 million Americans, across 1.3 million square miles. Much of this 30% increase in area coverage T-Mobile suggests is from moving to SA from earlier non-standalone (NSA) deployments. This is because their 5G 600MHz spectrum in NSA is limited by the coverage of the supporting LTE network. By moving to 5G SA the 5G spectrum is unshackled from LTE, and free to reach areas inside and out that the earlier generation could not.
While T-Mobile’s achievement is significant, ultimately it is not something we can expect to see repeated in the coming months by many other carriers outside of South Korea, a smaller geographical area, or China where the major carriers are aggressively deploying 5G SA networks. This is due to the low-band spectrum that T-Mobile uses, which they claim can cover “hundreds of square miles from a single tower.” The use of this low-band spectrum means that T-Mobile can cover larger areas using less network infrastructure than its rivals, such as Verizon, which has initially deployed 5G using mid-band or millimeter-wave spectrum, which has a more limited range. The trade-off is that T-Mobile’s 5G speeds are not much faster than their LTE network, whereas Verizon’s customers should notice a marked improvement in download and upload speeds in the areas covered by the operator’s mmWave deployments. Thus, as one of the most aggressive users of low-band spectrum for its initial 5G network rollout globally, T-Mobile has been able to gain an early marketing advantage through its swift deployment and scaling of 5G SA.
Omdia expects that few commercial 5G SA core deployments of this scale will take place this year. We expect COVID-19 to have delayed deployment timelines by as much as six months as most converged operators prioritized 4G capacity upgrades and fixed broadband investments given the unprecedented rise in home working during the pandemic, and some mobile carriers lowered or deferred capex to prepare for the potential financial shock of fewer net adds and much reduced roaming revenue.
NSA still has a big buildout ahead
Even if T-Mobile’s announcement truly marks the beginning of the SA age, the next year will see continued heavy investment from carriers in their NSA deployments. From our discussions with core network suppliers, including Nokia, it is apparent that those currently deploying 5G networks continue to scale up their deployments using NSA as they begin to deploy SA cores. With major markets such as India yet to even assign 5G spectrum, there are plenty of countries where NSA is the first step on the road to 5G.
In our recent NFV and Edge Survey operators clearly considered the adoption of 5G NSA as an integral part of the 5G roadmap. 38% of respondents said that they would “definitely” deploy 5G using NSA first, with a further 47% saying that they are likely to. Only 8% expected to go straight to 5G SA and bypass NSA deployments altogether.
Figure 1: Will you initially deploy 5G new radio (5G NR) in non-standalone (NSA) mode using LTE EPC?
The transition path from NSA to SA looks to be smoothing out. From our research and Omdia’s Telecom Vendor Contract Database, we have noticed CSPs are increasingly asking for dual mode NSA/SA core solutions from their vendors. This is an attractive proposition for many operators as it allows for an easier, single-vendor migration path for network cores without the need to change the systems supporting NSA and SA. Vendors that can show their clients a painless transition between the two, such as Cisco and Nokia appear to have done for T-Mobile, should gain market share as their clients continue to expand 5G footprints and gain increasing numbers of 5G subscribers.
Core vendor disruption looms in 2020
T-Mobile’s purported 5G SA world first with established core network suppliers Cisco and Nokia raises the question of what opportunities there are for new core network vendors. In recent years Mavenir has positioned itself as a growing challenger to the big networking vendors Cisco, Ericsson, Huawei, Nokia, and ZTE across both the core and radio access network (RAN) domains. 2020 has seen Oracle and HPE throw their names into the 5G core ring. Microsoft, through its acquisitions of Affirmed Networks and Metaswitch looks set to play a role in some core network deployments. And the Telecom Infra Project (TIP) has set up a new Open Core Network project group, OCN. What T-Mobile’s deployment shows is that these new players will need to deliver on those commercial 5G core contracts they have already won quickly if they are to take mindshare away from the incumbent suppliers.
“T‑Mobile Launches World’s First Nationwide Standalone 5G Network,” https://www.t-mobile.com/news/network/standalone-5g-launch, T-Mobile, accessed August 11, 2020
“US National Advertising Division 2014 ruling that defines ‘Nationwide’ coverage,” https://bbbprograms.org/archive/nad-reviews-verizon-4g-lte-ads-finds-web-print-comparative-map-claims-are-not-misleading-recommends-verizon-discontinue-tv-spot-with-claim-2x-bandwidth-in-cities-coast-to-coast, BBB Programs, accessed August 11, 2020
Telecoms Vendor Contract Database: May 2020, SPT002-000349 (June 2020)
“Telecom Infra Project: Open Core Network Group,” https://telecominfraproject.com/open-core-network/, Telecom Infra Project, accessed August 11, 2020
Chris W Silberberg, Research Analyst, Carrier Network Software