Tech Drivers
Tech Drivers

Why the coronavirus pandemic may fast-forward 5G adoption in the US

Key Points
  • The coronavirus outbreak and the rise in remote work has advanced the need for more robust 5G technologies in the U.S.
  • Verizon issued a press release on Wednesday stating the demands on bandwidth increased 75% over the previous week.
  • The FCC and federal government are trying to accelerate deployment in urban and rural areas.
  • The global pandemic has forced a supply chain slowdown that may delay further expansion of 5G.
A 5G logo is seen on an android mobile phone with United States of America flag on the background.
Omar Marques, SOPA Images | LightRocket | Getty Images

In March 2020 everything that could be moved online already has, from elementary schools to college classes, from entire company workforces to shareholder meetings. Whole cities have emptied under the coronavirus threat as businesses tell employees to work from home,  students are sent indoors to learn online and every type of entertainment— from restaurants and sporting venues to movie theaters — shutters, forcing people to stay home and rely on their home broadband networks to interact with the outside world.

This switch-over is unprecedented, which begs the question: Can our current networks handle the strain?

Moreover, is the coronavirus outbreak and the "social distancing'' required to mitigate the spread going to become the business case for more advanced and robust 5G technologies for a future in which business, health care and human interaction must be at more than an arm's length?

The jury is still out on whether home broadband, which tends to have lower capacity than more robust business networks, will be able to handle the traffic as whole neighborhoods become Wi-Fi hotbeds as adults video conference with their co-workers and their teens stream videos in between checking Blackboard for assignments. Providers, including AT&T, Verizon, and Comcast, are facing a test of whether they'll be able to handle the increased demand.

Jessica Rosenworcel, an FCC member, said the influx of people working from home is a test for the current networks. "We're going to have a big stress test on our networks," she said. "There are a lot of potential points of stress." The FCC has given the carriers access to additional bandwidth for the next 60 days to handle the additional users. (T-Mobile is so far the only carrier to take the FCC up on its offer to use spectrum in the 600 MHz Band to help meet increased consumer demand for broadband during the coronavirus pandemic.)

Rosenworcel said it's too soon right now to assess how the networks are handling the stress. "These are still early days," she said.

The carriers remain optimistic. "As a global company, we have extensive experience in planning for and responding to a wide variety of situations around the world," said Jim Greer, AT&T assistant vice president for communications. Greer said that the company is constantly monitoring developments in the coronavirus outbreak and is taking the appropriate steps "to help maintain the ongoing health and safety of our employees and customers."

Greer added that in cities in which the coronavirus has had the biggest impact, AT&T is seeing fewer spikes in wireless usage around particular cell towers or particular times of day because more people are working from home. The company continually monitors bandwidth usage to help it run its network.

In a March 12 interview with CNBC, Verizon CEO Hans Vestberg said he didn't see any major changes in Verizon's data usage during this coronavirus pandemic in the U.S. "So far, I'm really pleased with how the network is performing," he said, adding that the company is monitoring the network "24/7." 

Verizon also issued a press release on Wednesday stating the demands on bandwidth increased 75% over the previous week. Social media use was flat.

5G rollout in the US

Some believed that 2020 was to be the year of 5G, the fifth-generation of wireless technology. 5G is said to have download speeds 100 times faster than 4G. Carriers including AT&T, Verizon and T-Mobile began deploying it in 2019. Verizon's Vestberg said last year that half the U.S. will have access to 5G by the end of 2020. The U.S. government was behind the launch as well.

To facilitate the U.S.'s leadership in 5G, the FCC rolled out the 5G Fast plan in 2016 to accelerate deployment of high-speed broadband in rural America and held its third auction for 5G spectrum in late 2019. FCC Chairman Ajit Pai said in December he will propose $9 billion in funding to bring rural parts of America to parity with urban segments.

In addition, the U.S. government is paying around $10 billion to satellite providers to fast-track the auction of 5G C-band spectrum by 2023. C-band spectrum is sought after because it combines the ability to deliver download speeds in excess of 1 Gbps with much improved propagation ranges, compared to higher-frequency spectrums.

The 5G story stays compelling despite market volatility amid coronavirus crisis: Strategist
The 5G story stays compelling despite market volatility amid coronavirus crisis: Strategist

In 2019 5G was available on only about 1% of phones sold, according to market research firm NPD Group.

Carriers promote 5G as a major step forward for wireless that will usher in new use cases — from driverless cars to robotic surgeries to smart buildings. And coronavirus might just be the catalyst for 5G that the world needs as it forces whole nations to enforce quarantines and social distancing and remote work and schooling. 

China's 5G push

In China, which is a bit ahead of U.S. in deployment of the technology, 5G is being used to support health applications and apps that monitor the user's temperatures. A program was recently launched at a coronavirus hospital ward in Wuhan staffed by 5G-powered robots to protect medics from the deadly virus.

In the immediate future, the global pandemic has forced a supply chain slowdown that may delay the rapid expansion of 5G. There's been a dramatic slowdown with factory production in China that could slow the rate at which 5G equipment migrates to the U.S. and elsewhere.

"The Chinese won't be bailing out the world this time," said Jacob Kirkegaard, an analyst with the Peterson Institute for International Economics. He said the Chinese have adopted a "remarkably laissez-faire attitude to economic stimulus'' and, "as such, the slowdown in China is bad news for the world, including the U.S."

The effect of such a slowdown would be limited, though, since the Trump administration has already banned the use of Chinese components in the U.S. 5G network amid suspicions the devices would be used for espionage. 

Whatever the cause, the U.S. telecoms have so far not signaled a slowdown in their 5G rollouts. Jonathan Chaplin, an analyst with New Street Research, said he sat down with executives from the top telecoms and asked them whether the U.S. travel ban would affect them.

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"We asked them if that would affect their 5G rollout plans in any way," he said. "And the answer was a resounding no." 

 Chapman said one thing that could affect the rollout — a complete shutdown of factories — appeared unlikely.

Gigi Sohn, a former Federal Communications Commission official and now a fellow at the Georgetown Law Institute for Technology Law and Policy, said she expects carriers to focus on making sure their existing customers are happy during this time than trying to sell them on a new service. Sohn also said 5G is an urban phenomenon and that 5G may never reach rural areas of the U.S.

 A surge in US bandwidth demand

Sohn said she thinks broadband networks to homes can handle the extra traffic from people who are temporarily working from home. "The more salient question is, Will the broadband providers offer extra bandwidth and at what price?" she asked. Sohn advocates that in the current situation that companies provide more bandwidth —temporarily — for free.

Rob Enderle, principal of The Enderle Group, was nonplussed about potential delays. He said while some are waiting on hardware from Asia, they can improvise solutions. "They can, for a time, shift to doing infrastructure and site preparation, but the hardware shortage is undoubtedly harming timelines," he said.  "So while the impact won't be as dramatic as other areas, given workarounds, it will cause schedules to shift out somewhat." 

Roger Entner, a Boston-based telecom analyst, said so far the overall effect of coronavirus-related delays appears limited. "China is the factory of the world. All of the 5G base stations are being manufactured in China," he said. "I don't think there will be a big change because the coronavirus will be an effect of a couple of months."

Carriers may be able to argue that this sudden influx of workers from home necessitates more investment in 5G. Meanwhile, Wi-Fi 6, which  is just hitting the market, improves the speed of home Wi-Fi.

Coupled with Wi-Fi 6, 5G may yet revolutionize the market for stay-at-home workers. But it remains uncertain on how fast this will happen.