Mallinson: Will fixed network operators disappear with 5G?

Keith Mallinson

Throughout my many years as a telecommunications industry analyst, issues related to fixed-mobile convergence and the substitution of mobile for fixed communications have loomed large. Fixed and mobile operators have operated with different regulations, owners, strategies and associated institutions in technology standardization.

This is the elephant in the room for fixed networks with the advance to 5G networks. Technological advances and market growth make it logical to overhaul mobile and fixed network architectures and implementations from time to time. The current concept stage in formulating 5G mobile communications is also an ideal opportunity to reconsider the role of fixed networks, and how they should also be reengineered and operated in conjunction with mobile networks.

Untethered for voice, and now for data too

For many years after their creation in the 1980s, mobile networks were distinctly different from the fixed networks that had much higher capacity, reliability and a wider range of service offerings including, for example, managed data services and broadband. Nevertheless, the bonus of mobility has made mobile networks very attractive substitutes to fixed networks. Consumer minutes of use for voice calling exceeded those on landlines by 2005 in the U.S., and by the second half of 2013, 41 percent of U.S. households were relying entirely on mobile phones for this service. That figure has likely grown since then.

More recently, mobile broadband has also made significant inroads against fixed networks for Internet access and data services. Smartphones are becoming the most common means of accessing popular online applications such as Facebook. As consumers unsubscribe from cable TV in favor on Internet-delivered video from YouTube and Netflix among others, much of the content is viewed on mobile devices including smartphones, tablets and laptop PCs. In developing nations, smartphones with mobile broadband connections are becoming the first and only way billions will access the Internet.

Apart from the final 100-meter access link and the mobility that wireless facilitates, deficits in capabilities of mobile versus fixed networks are severely eroding. For example, with heterogeneous networks of large and small cells and cloud RANs requiring extensive front-haul, mobile networks are set to become as fiber rich as wireline networks. According to Cisco, global mobile data traffic was 1.5 exabytes per month at the end of 2013 in comparison to 36.4 exabytes of global Internet traffic. However, the difference is closing with mobile traffic growing 69 percent to 2.5 exabytes per month at the end of 2014. The fact that 46 percent of total mobile data traffic was offloaded onto the fixed network through Wi-Fi or femtocells in 2014 underlines the interdependency between the two types of networks.

Mobile networks will make great strides in performance and capacity as they upgrade to 5G. So far, there seems to be little contention about the wish-list of target network-performance improvements. These include massive broadband with 10 to 100 times more users and 10 to 100x increase in end-user data rates, generating 1,000x more data volumes, much reduced latencies, very high reliability and very long battery life. Machine-type communications will include massive deployments, critical applications support and very long battery life requirements, though not all altogether. Interworking with 4G LTE networks is also a major objective.

The high-capacity, high-performance capabilities envisaged for 5G begs the question of what will become the division of labor between mobile and fixed networks. A central aim in 5G is to employ one unified multi-purpose physical network which can be "sliced" and virtualized as defined in software and implemented in the cloud to serve a variety of different use cases and end users with different capacity, performance and cost requirements. With this generational change in the mobile networks, it would be worth at least considering also doing away with the division between fixed and mobile networks.

The NGMN Alliance's 125-page 5G White Paper dedicates only one small section to fixed-mobile convergence, which I have reproduced here in its entirety:

"The 5G system should support fixed and mobile convergence, in order to:

  • Ensure a seamless customer experience within the fixed and mobile domains (e.g., a unified user authentication).
  •   Allow the operator to process a customer independently of his access type for authentication and billing, via a unified customer data base and information system across the fixed and mobile domains."

Why continue to have separate fixed and mobile networks?

If it makes engineering and economic sense to have one unified physical network to support all the different use cases and services in mobile, it would seem logical to extend this principle also to include the fixed network and with some additional use cases. The physics in the airwaves, optics, copper and silicon is the same for fixed and mobile networks. There is no reason why compelling network-architecture concepts and technologies including network-slicing, cloud, Network Functions Virtualization and Software-Defined Networking should be bounded by the pre-existing demarcation between fixed and mobile networks.

However, there are significant impediments which tend to perpetuate the division:

  • Regulation and licensing. Fixed and mobile networks have distinctly different histories in regulation and licensing. For example, fixed-network operators serving the masses are typically former monopolies which in many cases have common-carrier obligations or pricing restrictions, such in wholesaling broadband capacity to ISPs and as governed by "Title II" regulations in the U.S. Mobile operators are highly-dependent upon spectrum licenses, which are costly and allocated to specific operators and with other restrictions such as spectrum caps.
  • Organization. Mobile operators are most commonly under different ownership and control to fixed networks. Merging fixed with mobile can be subject to review by competition authorities. However, these agencies currently tend to be more amenable to this than horizontal mergers between mobile operators. Company strategies can vary. For example, Vodafone used to have a pure-play mobile orientation, but it now likes to own both fixed and mobile networks in the same national markets. The owners of network operators have in some cases been reluctant to combine workforces due to cultural differences and the unionization that was in fixed but not in mobile organizations.
  • Standards. Open standards for technical interoperability are enormously important in telecommunications. Standardization is a wide-ranging endeavor. Consequently, there are different standardization bodies in fixed and mobile communications. 3GPP, including ETSI in particular, has been enormously successful in the development of mobile standards. ITU-R (Radiocommunication Sector) holds significant sway thanks to its role in coordinating use of spectrum bands internationally and in development of IMT-2000, IMT-Advanced technical and operational "specifications." This will continue with World Radiocommunication Conference 2015 and WRC 2019 for additional spectrum (e.g. <6GHz, cmWave <30GHz, mmWave 70-90 Hz, etc.) and in developing IMT-2020 specifications for 5G. ITU-R's non-mobile counterpart ITU-T (Telecommunication) is also getting in on the act with 5G by establishing a focus group which "will provide the launching point for ITU-T's contribution to IMT-2020 standardization."

Mobile is where most of the action and money has been in telecommunications in recent years. Whether fixed networks will be relegated to providers of network plumbing, subsumed by mobile networks somehow or revitalized as distinct offerings with the advance to 5G is unclear.

Keith Mallinson is a leading industry expert, analyst and consultant. Solving business problems in wireless and mobile communications, he founded consulting firm WiseHarbor in 2007. Find WiseHarbor on Twitter @WiseHarbor.