Australia’s consumer watchdog claims to have proof that 5G internet will be powerful enough to allow smartphones to compete with home internet connections by the year 2020.
In its final NBN report, the Australian Competition and Consumer Commission (ACCC) calculated that 5G had a maximum speed of a whopping 10,000 megabits per second – about 300 times faster than the typical home connection.
“Although 5G networks are yet to be deployed, we consider there is potential for this new technology to disrupt fixed broadband services, as they have the capacity to provide comparable speeds to fixed networks with the added advantage of portability,” the watchdog found.
5G, which stands for ‘5th generation’, builds on today’s 4G network but promises much higher speeds and lower time delays, made possible by better radio frequency technology and more radio antennas.
Last year, the world’s leading authority on mobile networks, GSMA Intelligence, predicted 5G would cover a third of the world’s population, or one in eight mobile connections, by the year 2025.
As shown in the chart below, the upper limit on 5G speeds is 10 times the existing limit on Australia’s fastest possible 4G connections. Our 4G networks already rank inside the top 10 fastest in the world.
The chart you need to see:
But, as noted by the ACCC, the max speed of 5G is “theoretical” and depends on “spectrum, small cell infrastructure and transmission networks”. Which means it depends on how much money the telco giants decide to invest in 5G.
The actual download speeds enjoyed by 5G phone users by the year 2020 will be about 100 megabits per second (Mbps), according to computing expert Dr Mark Gregory. Some experts have even higher estimates.
Even at 100 Mbps, that is still much faster than the typical Australian broadband connection of just under 29 Mbps, estimated by US-based Speedtest in January.
Australia already has the world’s seventh-fastest mobile downloads at an average of almost 49 Mbps, according to Speedtest’s global rankings.
NBN plans can be as fast as 100 Mbps, but most users are choosing 12 Mbps or 25 Mbps plans. The ACCC said this was because of cost, lack of competition on speed by the telcos, and a combination of ignorance and poor expectations on the part of consumers about how fast and reliable the NBN actually is.
On cost, an NBN plan with 50 Mbps and 1000GB is priced at about $80 a month, whereas a 25 Mbps plan with unlimited data costs about $70, according to the ACCC.
The ACCC is unsure. It noted that mobile data allowances were “still significantly smaller” than home internet and that there was “uncertainty” around how much data 5G providers would eventually offer.
“Although the amount of data included for wireless offerings has been growing, in general, it is still typically less than 200 GB per month, while recent trends mean that most fixed line services now include unlimited data,” the watchdog concluded.
“If this divergence between data quotas continues in the future, it may limit the substitutability of wireless for fixed line broadband for most consumers.”
Several academic experts, including Melbourne University’s Dr Rod Tucker, have concluded that mobile 5G plans will never be a good enough substitute for home broadband because each gigabyte of mobile data will always cost far more.
If true, this would invalidate claims that 5G would make the NBN rollout redundant.
The ACCC report was careful to say that 5G “may increasingly be a viable substitute for home internet” for “some consumer segments”, and that it would “accelerate the extent of fixed to wireless broadband substitution”. It made no predictions, over the report’s five-year horizon, that the NBN would become obsolete.
But the report did predict that some web users would favour the “on-the-go connectivity” of 5G over other factors such as price and data limits.
Whether Australians switch from home internet to mobile 5G in droves will also depend on “the price and service performance of NBN services”, the ACCC said.
The 5G network is expected to be rolled out nationwide by 2020, around the same time the NBN is expected to complete its rollout, with early 5G access in “key metro areas” from 2019.
Telstra and Optus have already begun 5G trials at the Commonwealth Games on the Gold Coast.