Claire Gillies, president of Bell Mobility, near a 5G antenna tower in Burlington, Ont., on Dec. 19, 2020.Glenn Lowson/The Globe and Mail
After years of promise and anticipation, some Canadians finally saw 5G icons light up on their phones this past year.
In January, Rogers Communications Inc. (RCI) launched initial 5G service in a handful of major cities, making it the first of Canada’s three biggest telecoms to do so. However, it would be a few weeks before 5G-capable phones were actually available in Canada. By June, BCE Inc.’s Bell Canada (BCE) and Telus Corp. (T) had also launched early iterations of fifth-generation wireless service, targeting Vancouver, Montreal, Calgary, Edmonton and the Greater Toronto Area.
These initial 5G deployments, which rely on installing 5G-capable radios on top of existing 4G network backbones, have since expanded to many smaller municipalities across the country. In December, Rogers launched the country’s first standalone 5G wireless networks in several cities, though consumers won’t see service improvements until the next generation of 5G-capable devices becomes available.
It’s still early innings in the years-long rollout of 5G, in other words, but the race to deploy is in full swing. The technology promises much faster upload and download speeds and significant reductions in latency, or lag time, enabling new technologies such as remote surgeries and driverless cars that demand nearly instant response times.
Fifth-generation wireless networks can also handle a vast increase in the number of connected devices, making it possible to hook up thousands of sensors to monitor traffic on roads or soil conditions on farms, unleashing the potential of the Internet of Things (IoT).
Telecom executives say 5G will usher in a wave of technological innovation that will reshape entire industries; Rogers chief executive Joe Natale has likened its arrival to the impact of cellphones a generation ago. But building out the networks to provide the service is a massive undertaking, one that will take years and cost billions. A 2018 Accenture analysis estimated that Canadian wireless carriers will spend $26-billion on 5G network infrastructure.
But in spite of the recent moves by wireless carriers, experts say that Canadian consumers, businesses and industrial users won’t be able to reap the benefits of next-generation wireless technology until more spectrum becomes available.
Spectrum refers to the airwaves used to transmit wireless signals, and Ottawa has been slow to auction off the bands that carriers will need to deliver 5G services, says Bernard Bureau, vice-president of network and architecture strategy at Telus. The federal government postponed a planned auction for 3,500-megahertz spectrum – a band deemed critical for 5G because it can can carry large amounts of data over long distances – by six months because of the pandemic. Originally slated for December, 2020, the auction is now scheduled to take place in June, 2021.
Another key 5G band, in the 3,800 MHz range, might not be available until 2023; Ottawa is still mulling how best to clear the band, which is currently in use by satellite operators.
Some warn that Canada already trails other countries in the global 5G race. “Most of the advanced economies around the globe auctioned 3,500 MHz spectrum in 2018 or 2019. We are behind now,” says Mr. Bureau. “That said, we have fantastic 4G networks in Canada so I don’t think it’s a catastrophe that we’re a little bit behind, but we are behind.” The next year will be critical in the race to build out the networks.
Why 5G matters
While previous generations of wireless technology have provided incremental advantages to mobile users, 5G promises to reshape communications in ways that could be transformational.
Wireless networks are made up of two parts – the radio access network, comprised of the gear on cell towers and cell sites, and the core, which functions as the network’s brain. With earlier iterations of mobile technology, a national wireless network would typically have a small number of cores, perhaps two or three, housed in data-centre buildings in different parts of the country.
Fifth-generation wireless networks, in contrast, will have many mini-cores, cutting down on the distance that cellular signals need to travel. That reduces lag time, referred to in the industry as latency.
“Low latency will basically enable real-time communications between your handset or your tablet or your computer and the cloud,” says Kye Prigg, senior vice-president of access networks and operations at Rogers. “That’s going to be important for mapping applications, autonomous cars, all kinds of sensors, gaming, virtual reality and also for industry.”
Software will also play a larger role in managing 5G networks. That will allow operators to slice their networks into different portions – for instance, to provide priority access for emergency services, or guaranteed high-speed service for mobile gaming.
Network slicing is the equivalent of creating a special lane on a busy highway, says Claire Gillies, president of Bell Mobility. Take, for example, the Raptors parade. “If something happened to you in that Raptors parade and you needed emergency services and the cell sites in that area were very congested because there was an extreme amount of activity and traffic, slicing would allow us to take a portion of that network to provide priority access,” Ms. Gillies says.
Many of the potential uses for 5G haven’t even been discovered yet, Mr. Prigg says. “We’re building all these capabilities … and then it’s going to be very exciting to see what developers come up with and what ideas are going to come down the pipeline.”
This is where the notion of the global race for 5G comes in. When fourth-generation wireless technology was introduced, the first countries to get the new service ended up developing the most successful 4G products, according to Sascha Segan, lead mobile analyst for technology publication PCMag. He cited Snapchat, Android and Uber as examples.
“So there’s this idea that the first countries to get 5G technology will end up creating the great 5G solutions,” Mr. Segan says. “But that doesn’t mean just getting it, technically – it means a lot of people have to be able to access it in a way that matters.”
Where Canada stands in global race
In order to access 5G service, mobile users must have compatible devices. At the end of October, roughly 800,000 such devices – including the newly launched Apple iPhone 12 – were connected to Canadian 5G wireless networks, according to data from market research firm Counterpoint Technology.
Canadians using 5G service are generally seeing speed increases of about 15 to 20 per cent, depending on their location, says Hanish Bhatia, a senior analyst at Counterpoint Research. In general, Canadians will experience smaller speed gains than mobile users in many other countries because Canada’s 4G networks are already very fast, says Mr. Bhatia. In some instances, Canadian 4G networks are outperforming American 5G networks on speed, according to a November report by PCMag.
So far, most of the 5G rollouts by Canadian wireless carriers have involved creating an additional channel on top of existing 4G networks. The advantage of this approach, which in the industry is referred to as non-standalone 5G, is that it allows carriers to start offering fifth-generation wireless services to their customers much sooner.
The next step is to build standalone 5G network cores, such as those that Rogers recently launched, all across the country. “The standalone core is the next evolutionary step of 5G,” Mr. Prigg says.
However, current 5G devices are only compatible with non-standalone 5G service, or with 4G networks. The next generation of smartphones, which will have a chip that’s compatible with standalone 5G networks, won’t be widely available until late 2021 or 2022, Mr. Bureau says. That’s when Telus is aiming to launch its standalone service.
Bell is targeting a launch date of 2022 for the standalone service. “Bell and Telus are probably calculating that any real explosion of new 5G ideas is not going to come until after [the June] auction,” says Mr. Segan.
Smaller carriers have also been moving ahead with their 5G plans; Quebecor Inc.’s Videotron Ltd. launched its initial 5G service in Montreal in December, with plans to expand across the entire province of Quebec. Shaw Communications Inc., which owns wireless carrier Freedom Mobile and recently launched its Shaw Mobile service in Alberta and British Columbia, plans to start offering 5G service in early 2021.
Rogers has been particularly aggressive in pursuing bragging rights as the first telecom to bring 5G to Canada. Mr. Bhatia says the company’s single-vendor strategy – the company is working exclusively with Swedish supplier Ericsson to build its networks – may have expedited the process. Its competitors, meanwhile, have both signed deals with multiple suppliers.
Bell and Telus have also had to contend with Ottawa’s indecision around Huawei Technologies Co. Ltd.; the federal government has, for the past two years, been conducting a cybersecurity review to determine whether the Chinese telecom giant should be permitted to supply gear for the country’s 5G telecom networks.
That indecision has forced Bell to move ahead without the Shenzhen-based company, Ms. Gillies says. Instead, it has inked deals with both Ericsson and Finland-based Nokia Corp. “We had to choose, in order to meet our timelines for delivering 5G,” she says.
What to expect in 2021
Over the coming year, Canadian wireless carriers will continue expanding 5G service to new markets and preparing their networks for when new spectrum arrives.
The June, 2021, auction of 3,500 MHz spectrum represents the next major milestone for the sector, and demand from all the carriers is expected to be robust, BMO analyst Tim Casey said in a note to clients. With limited spectrum available and telecoms vying for large, contiguous blocks, prices are likely to be high – and there’s no absolute guarantee that each of the big three carriers will walk away with spectrum licences.
Bell alone is expected to shell out between $500-million and $1-billion for the rights to the radio waves, according to various analyst estimates. Ms. Gillies says Bell was disappointed when the auction got postponed – it had just sold 25 of its data-centre facilities for $1.04-billion, amassing a large war chest – but the company will be ready come June. “When that [spectrum] comes, we want to be ready to deploy it as soon after that June auction as we can,” Ms. Gillies says.
Telecoms will also need ultrahigh-frequency airwaves, known as millimetre-wave spectrum, for 5G. These airwaves, which provide lightning-fast speeds but can’t travel long distances or penetrate buildings, will be deployed primarily in dense urban areas or public gathering spots. An auction for millimetre wave spectrum is also scheduled for 2021, “but a delay would not be a surprise,” says Mr. Casey.
One thing that remains unclear is how the wireless carriers will recoup their massive investments. Consumers are unlikely to pay higher prices for the new service, so telecoms will be looking to industrial IoT applications to monetize the technology.
However, until carriers are able to acquire and rollout the new spectrum, Canadian consumers and businesses are unlikely to experience the more radical benefits of 5G, analysts say.
“We’ll see the real benefits of 5G in 2022 or 2023,” Mr. Bhatia says. “Until then, from the consumer side, I think it’s more or less going to be a marketing game.”
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