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Russia connected. 5G for Russian digital economy

May 29, 20:11 UTC+3
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5G networks are expected to bring about a veritable revolution in business processes owing to the brand new technological opportunities that come along with them. The industrial Internet of Things, smart cities, self-driving cars, telemedicine and other promising development areas will get a fresh start following the 5G standardisation. Russia is leading the pack in terms of 5G implementation, with the Government and mobile operators planning to create a pilot 5G zone during the 2018 FIFA World Cup and roll out 5G networks by 2020 in eight cities with a population exceeding one million people.

The fifth generation networks will increase the speed of data sharing by an order of magnitude and lay the groundwork for the development and implementation of new digital technologies.

  • The IoT progress relies on the success of 5G solutions, as the new networks will give an opportunity to deploy thousands of smart electricity and production equipment meters, as well as smart lighting and urban security sensors.
  • In manufacturing, retail, agriculture and other industries, 5G will pave the way for a wider use of industrial robots and drones exchanging information from remote locations at a very high speed.
  • The new 5G services can also come in handy in healthcare, as they will ensure the transfer of medical data, remote patient monitoring and the performance of robot-assisted surgery.

The official launch of 5G is slated for 2020, i.e. after the approval of the International Telecommunication Union's IMT-2020 standard. Despite that, mobile operators have already started piloting the 5G networks to be able to proceed to the industrial roll-out straight away in 2020. 

  • In April 2017, Huawei and Telenor beat the world record in Norway by achieving the data transfer speed of 70 Gbps.
  • In April 2017, MTS and Ericsson successfully tested the fifth generation communication technology on the moving smartphone prototype with the data transfer speed of 25 Gbps. The companies are not going to stop there, as they are working on a pilot 5G coverage zone for the 2018 FIFA World Cup.

Governments also support the 5G roll-out.

  • In March 2017, the UK Government published its 5G strategy seeking to make the UK a global leader in the fifth generation network solutions. 
  • In March 2017, Beijing put in place the world's largest 5G test network, with the Made in China 2025 programme laying the groundwork for a breakthrough in the fifth generation communications.
  • Pursuant to the draft programme for Digital Economy, which is expected to be submitted by the Ministry of Telecom and Mass Communications to the Chairman of the Russian Government in early June, the 5G internet will become a reality in eight cities with a population of over one million people by 2020, while, by 2025, it will be rolled out in 15 cities.

Experts from Ericsson believe that, by 2020, there will be some 550 million 5G users all over the world, whereas, in 2026, the global 5G market will total USD 582 billion.

  • Analysts from CCS Insight project the number of 5G-enabled devices at 100 million in 2021, with the US, Japan and South Korea leading the way in market penetration. ZTE has already announced the launch of the world's first 5G smartphone, which is due to come on stream as early as in 2017.
  • According to the IHS projections, the 5G roll-out can create 22 million new jobs globally by 2035, while also producing new goods and services worth some USD 12.3 trillion.

Yet, the ABI Research analysts believe that the transition to 5G will be gradual, with LTE remaining the most wide-spread standard over the span of at least 10 years.

  • Currently, LTE supports 67% of global mobile traffic. In 2022, i.e. two years after the the commercial launch of 5G, the market share of LTE will rise to 82%, while the number of LTE users will double.
  • In the near term, LTE will not differ from 5G: the mobile operators are upgrading the technology and, by the end of 2017, they will start offering the Gigabit LTE.
  • LTE is available in all Russian regions now with the market penetration of over 70%.

The 5G roll-out investments will be much higher than those required for the implementation of networks belonging to the previous generations.

  • Market experts believe that mobile operators have no other choice but to join their forces to put 5G networks in place. Artem Ermolaev, Head of the Moscow Government's IT Department, said that the municipal authorities were discussing with the mobile operators a possibility of creating a consortium to help promote the 5G communications.
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