Verizon Claims 5G Gold Medal

As Chicago gets 5G services, so does Seoul

In the always confusing and sometimes debatable world of 5G firsts, here are more announcements to add to the list, as Verizon in the US and SK Telecom, KT and LG in South Korea all turn on 5G networks.

On Wednesday, South Korean operator SK Telecom announced that it will officially launch standards-based 5G services in South Korea today. It said it has 34,000 5G base stations installed in the country. Like all operators in the country, SK Telecom will run 5G services over 3.5 GHz and 28 GHz spectrum, allowing for a mix of services and devices. SK Telecom claims its network supports speeds of up to 2.7 Gbps. It expects to cover 80% of the country with 5G by the end of 2019.

The operator also announced several different price plans for its 5G service. The lowest-priced, called Slim, includes 8GB of high-data speed with a throttle speed of 1 Mbps for 55,000 won (about $48) per month. Its 5GX Prime plan offers 200GB of high-speed Internet for 95,000 won (about $84) per month and 5GX Platinum gives customers 300GB of data for a monthly 125,000 won (about $110). Early subscribers will get unlimited data to the end of the year, but for many people around the globe, 300GB already equates to unlimited.

SK Telecom says that its 5G plans compare favourably with LTE: it’s offering the same amount of data at lower prices and its tariffs include some limited-time promotions. Having said that, its entry 5G tariff is hardly a steal; many subscribers will quickly burn through 8GB of data on a 5G network.

The three South Korean mobile operators are officially launching their commercial mobile 5G networks in a coordinated effort with Samsung, offering the Galaxy S10 5G phone on pre-order from today, although the device won’t ship for several weeks.

But all that noise of the rush to be first didn’t fall on deaf ears in the US, as Verizon revealed that it activated its 5G network in two cities on Wednesday, one week ahead of schedule. In a press release, it said that 5G services will be available in parts of Minneapolis and Chicago. Subscribers in these areas can tap into the carrier’s 5G network “with the world’s first commercially available 5G-enabled smartphone” — the Motorola Z3, which doesn’t have 5G antennas, but can be coupled with a Motorola 5G “mod” that snaps onto the back of the phone. Verizon CEO Hans Vestberg said that “Verizon customers will be the first in the world to have the power of 5G in their hands”.

This contagious race to be first off the 5G blocks highlights the importance of being recognized for their innovation among press, regulators and investors, as well as enterprise customers and consumers. And for executives, there’s a sense of personal pride. Yet the industry needs to be careful about setting unrealistic expectations, having had its fingers burned too many times before. In 2018, we wrote how a flurry of operators had claimed commercial 5G network launches even thought they were unable to offer any supporting devices to access them (see The 5G Playground Squabble).

The reality is that success in 5G will be a factor of many different elements, including network quality, tariffing, services and customer care. Whoever got there first is irrelevant to most consumers and is unlikely to be remembered in a few weeks anyway. Verizon may have claimed the gold medal, but its initial network roll-out appears far inferior to its rivals in South Korea. Furthermore, SK Telecom appears to have seized a lead in content and services for 5G, particularly in augmented and virtual reality. It’s working with several third parties including Niantic and Riot Games to create new immersive experiences in areas such as e-sports, multiplayer gaming, fitness, art, travel and movies. It also claims stronger security credentials by applying quantum cryptography to eliminate the risk of hacking. Even if South Korea was beaten by the US’ Verizon in the race, its initial 5G offers appear far more interesting that Verizon’s.

Operators, device makers and governments, too, see this as the very beginning of something special, and 5G really has been designed from the ground up to enable a new type of infrastructure and ultimately a new type of economy.

These claims show a confidence and eagerness to push the next-generation service forward at all costs. It’s a risky play, but top carriers in the US, South Korea and China see the real risk in falling behind.

If we’ve been uncomfortable with “first to 5G” claims in the past, we believe this time it’s different.

Earlier this week, CCS Insight published its latest quarterly market analysis of 5G networks and services. It analyses the latest developments in 5G and updates on supplier contracts and network deployments. Our latest 5G forecast of connections will be published later in April 2019. If you’d like to know more, click a button below.