In 2020, the sudden COVID-19 outbreak is having a major impact on mobile operators planning to roll out 5G services. The rapid spread of the epidemic continues to disrupt the global economy and is likely to intensify, with no immediate signs that the epidemic will end any time soon. Smartphone sales are forecast to fall 21 per cent this year (although they will recover by 2021), which will also affect the number of users upgrading to 5G terminals. Still, there are many positive signs in 2020 that 5G still has great growth potential, including its ability to respond to outbreaks.
5G networks continue to grow
Since the beginning of 2020, operators have still released 15 5G commercial networks. Since late February, Thailand AIS, Hong Kong HKT, Hong Kong China Mobile and Japan's NTT DoCoMo, KDDI and Softbank have all launched new 5G networks, despite the growing impact of COVID-19. In addition, Japan's Rakuten Mobile also released a new plan for 5G ahead of the summer.
Meanwhile, global operators continue to expand their 5G networks. In China, the government is using infrastructure projects to offset the economic impact of the outbreak, with 5G being one of the core infrastructures. China Mobile plans to deploy 300,000 5G base stations by the end of 2020, while China telecom and China Unicom have set a goal of deploying 250,000 base stations in their 5G co-built and shared networks by September 2020. In the United States, 5G investment plans also remain strong, with Verizon ramping up CAPEX spending in 2020, and the international rating agency noting that "despite the challenging economic environment, there should be sufficient cash flow to support the planned 5G budget and support the broader rollout of 5G services later this year." While operators in some countries and regions under lockdown have prioritized network maintenance over network upgrading, 5G deployment is still underway and operators need to be ready for rising sales of 5G terminals in the second half of 2020.
To cope with more than 40% of the growth in fixed-line broadband traffic due to services such as homework and distance learning, operators have increased investment in backchannel networks. These investments to enhance the return network, which account for nearly a quarter of the cost of 5G deployment, will greatly simplify and accelerate 5G deployment.
