CMS Expert Guide to 5G

A global overview

Most people agree that the introduction of the fifth generation in mobile communications (5G) will change our lives for the better. Unlike earlier generational changes in mobile communications, 5G will not only be a radical change in the way we communicate (low latency, substantive growth in system capacity, ultra-high reliability and gigabit speeds). Rather, given its emergence at the same time as the current digital revolution, 5G technology will drive fundamental changes in the way we live. Through its significantly improved performance characteristics, 5G is the first mobile technology truly able to extend the reach of broadband wireless services to the Internet of Things (IoT) – the GSMA foresees 25 billion connected devices by 2025 – and critical infrastructure applications. A multitude of potential use cases – from smart factories and cities, driverless cars, augmented reality and 3D videos to remote health care – all supported by 5G, will transform our society. Digital transformation of industry should yield significant economic benefits and efficiencies, while increased individual leisure time should be enhanced through our ability to enjoy upgraded digital content and experiences.

But for this to happen, huge investments need to be made in the coming years, and difficult legal problems linked with such investments must be solved. According to the GSMA annual global capex in mobile telecom infrastructures is currently running at about USD 160bn, and some predict that 5G infrastructure alone will have a yearly global cost of USD 200bn over a sustained period of time. This will mean very high capex for already highly-leveraged telecom carriers, with third party funding (from infrastructure funds or corporate venture capital amongst others) a likely prerequisite.

The topologies of 5G networks will also be different to those of previous generations, with a greater need for spectrum, a significantly increased use of small cells, and a far greater dependency on fibre networks.

Legal issues and challenges look set to arise from the likely requirement for network sharing (whether of passive, active or radio access elements) and the use of innovative infrastructure models with spectrum sharing or network slicing within the spectrum of one operator.

Nevertheless, even if 5G is seen a global trend, its deployment will be neither immediate in time nor homogeneous in geography. According to the GSMA, by 2025 only 14% of mobile communications will be 5G globally, with 53% 4G and an astonishing 29% still 3G. In Europe, by 2025 only 31% of mobile communications will be 5G, and almost half (49%) will still be 4G and therefore offering only limited IoT functionality.

Across countries, 5G will develop at different speeds and with different features. Some technical parameters are common; the same cannot be said for regulation. Therefore, it is critical to identify the differences in 5G regulation between the main jurisdictions if we are to be able to develop a roadmap for 5G’s future deployment. CMS is best placed for this task. With its global network of offices, CMS can provide local advice on the changes being made to national legal frameworks in anticipation of the arrival of 5G. This paper includes summaries of some of the key 5G related regulatory positions being taken in 33 jurisdictions. The USA is not included in this first edition, but will be added in the near future. Further detail will also be added covering issues such as access to fibre and existing infrastructure. We hope this information will be valuable for investors, telecom companies and even regulators.

Authors

Picture of Chris Watson
Chris Watson
Head of the CMS TMC Group
Picture of Javier Torre
Javier Torre de Silva
Global Co-Head of Communications, TMC
Picture of Stuart Blythe
Stuart Blythe
Global Co-Head of M&A, TMC