Does Europe need to up its 5GSA game?

Just how far Europe is behind the China, India or the US in the US its its use of 5G SA was illustrated by figures shared at the beginning of a panel discussion on monetizing 5G SA during the NetworkX event in Paris.

In the first half of this year, “around 2% of all speedtest samples in Europe originated on 5G standalone connections," according to Luke Kehoe, Industry Analyst, Europe at Ookla. "It was over 20% in the US, over 40% in India, and over 80% in China. So you're talking about a massive gulf in not just the actual deployment of the technology, but end user use,” stated Kehoe.

So why are European telcos trailing behind other their peers in other major markets when it comes to 5GSA investment? And does it mean they and their customers will miss out?

Part of the answer lies in the structure and connectivity landscape of the European telecoms market. Like most other operstors around the world, European telcos kickstarted 5G deployment with 5G NSA, which gave them 5G capabilities in the RAN.

The next step of building a 5GSA network means investing in a cloud native 5G SA core and creating an end-to-end 5G network. That doesn’t come cheaply. And although moving to 5GSA would give telcos new capabilities such as dynamic network slicing or high-order MIMO and carrier aggregation, they have to weigh up whether demand warrents investment.

A key focus for slicing, for example, has been the enterprise market. However, “there are not any customers asking for slices. They're asking for something else. They're asking for a product,” according to Dr. Terje Jensen, SVP, Global Business Security Officer, Telenor. “We don't sell private networks as such … we sell an experience to a customer, explains Jensen. "This could be a dedicated slice or a campus network, or options in between those two things. You're transforming the business process of the enterprise. This is where value lies.”

Not every telco in Europe has a strong enterprise service arm. And consumers will also need solutions if they are to loosen their purse strings.

“You can't just go and offer the customer premium connectivity. Premium connectivity for what?” pointed out Assen Golaup, Senior Manager - Mobile Access Strategy, Liberty Global. "If you're offering a low latency slice, for example, for gaming, and as a result, that customer is able to do away with their expensive equipment that he's using at home … [they] may [be] willing to pay with more for that premium slice,” added Golaup. “Because that saves some money [on] buying equipment.”

In India and the US Jio and T-Mobile, which have led 5GSA rollout in their respective countries, use their 5GSA networks to offer fixed wireless access [FWA]. However, extensive fiber network competiton in urban areas means European operators typically lack this business case.

“In Europe, we -- at least in our markets -- haven't seen a big driver for FWA … because you have fiber,” stated o Golaup.

And although there are several 5GSA deployments dotted across Europe, including Orange in France and Romania, Sunrise in Switzerland, and Elisa in Estonia, when it comes to 5G SA rollout across multiple operators in Europe, Omdia points out that Germany, the United Kingdom, and Spain have led because they have been spurred by fiscal stimuli and coverage obligations.

Nonetheless, Telenor’s Terje believes there are reasons for European telcos to invest in 5GSA that go beyond the customer business case.

"With standalone we're looking for business use cases, but there are some technology use cases. 5G standalone is inherently a better technology. It's more efficient, it provides better latency," he said.

“There is a technology use case that everyone should be working on. Standalone is not a big bang thing. It's incremental. You can go step by step, cluster by cluster, city by city. Dynamic network slicing … is a good internal tool for managing your network resources efficient. It's about cloud native, it's CICD, different ways of working, especially in a brownfield operator.”