by Peter Griffin 01 August, 2019
Vodafone beats Spark to roll out a 5G network, which can be used to improve Internet of Things and wireless broadband services.
If you are wandering around central Auckland in December and happen to have a new 5G smartphone, like the Samsung Galaxy S10 5G, you’ll be able to access Vodafone’s new 5G wireless service.
What will that actually mean?
“It will be ten times faster from a speed perspective and significantly reduced lag and latency,” said Vodafone’s chief executive officer, Jason Paris.
“If you are gaming you’ll see a noticeable advantage. If you are downloading or sending files there will be a noticeable advantage.”
Vodafone’s speed tests, using equipment from Nokia which is building Vodafone’s 5G network, show connection speeds of up to 1Gbps (gigabit per second), which is the maximum speed for ultrafast fibre broadband connections.
But if Australia’s recent 5G mobile launches are anything to go by, coverage will initially be patchy and a limited range of handsets and 5G services are likely to make it more of a symbolic step forward than an early game-changer.
More significant is likely to be the business applications that emerge for 5G, such as in the use of Internet of Things (IoT) devices and in the fixed wireless broadband space, where 5G cell towers will increasingly deliver broadband as an alternative to fibre and copper line connections.
The surprise move by Vodafone to confirm its launch of 5G services in December in central Auckland, Wellington, Christchurch and Queenstown comes on day one of the newly re-formed company.
The London-based Vodafone Group sold its New Zealand operation in May to a consortium of investors including listed company Infratil and Canadian investment company Brookfield Asset Management in a deal worth $3.4 billion. Vodafone New Zealand gets to keep using the brand, maintain its roaming relationships and access technology from the Vodafone Group.
“We will be more than 50 per cent of their business as their biggest partner market for roaming, brand, Vodafone TV, our IoT platform and procurement services,” says Paris.
“If India is buying 5G towers, we can just add ours to their procurement.”
So separating from a global giant would seem to come with few disadvantages then. Paris said the certainty over the new ownership allowed Vodafone to kick off its 5G play after a subdued public position on the new technology, compared to rival Spark which has championed it.
Vodafone had some existing 3.5GHz spectrum it inherited from its TelstraClear acquisition in 2012, which means it can roll out 5G, at least in main centres, before the Government completes its radio spectrum auction next March, which will see Vodafone join its competitors in bidding for access to the airwaves to run national 5G services.
Its choice of partner in Finnish equipment maker Nokia also meant Vodafone avoided the Huawei factor, which is dogging rival Spark. An application by Spark to use Huawei equipment in building its 5G network was rejected by the GCSB last December and it is still unclear what role, if any, Huawei can play in the network build.
“We don’t have that hesitation some of our competitors have around the Huawei decision,” says Paris.
“We can go full steam ahead with a proven technology partner.”
Read more: What the controversy over Huawei and 5G is all about
No 5G premium
With 120 5G base stations expected to be live in December, we may get a taste of that blistering speed, but Paris isn’t convinced it is worth charging customers more for.
“I still don’t think at the moment that New Zealand will pay a premium for it,” he says.
“We intend to make 5G available to our existing mobile customers for free. We will decide next year whether new customers joining us will start to pay a premium for 5G from that point.
“If you are with us today you continue to be with us or if you join us over the next few months, you’ll get 5G for free for the life of your plan.”
Instead, Vodafone will make money from new services that emerge in the 5G world. Overseas, they so far include gaming and wearable technology in the consumer space and remote surgery and factory automation applications in the commercial world.
Is New Zealand business ready to adopt the Internet of Things services that 5G will increasingly enable?
“There is still an education job to do,” Paris says. “People think IoT is about leading-edge technology, but in some instances, it is just about making old tech smarter.”
He points as an example to IoT.nxt, a South African company that Vodacom has invested in.
“It put simple sensors on automatic timers in schools on lighting and energy,” Paris explains.
“Instead of the automatic timers turning the heating and lighting on at 6am and turning them off at 6pm, it turned them on when the people were there. It halved their energy bill overnight.”
Similar IoT services will emerge here, he says. Vodafone today revealed it had partnered with New Zealand Police, Auckland Rescue Helicopters, BNZ and Waste Management, to begin developing some of them.
That’s where the real value will lie for Vodafone and customers as companies and local authorities start to create smart networks fed by sensors and remote controllers.
Read more: Noted New Zealand