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5G Rollout in Korea – The First Month

It has been a little over a month since the three major carriers in Korea – SK Telecom, KT and LGU+ – took the country into the 5G era by launching commercial services simultaneously. The three companies launched the world’s first 5G service at a launch event with celebrities including Korean pop-stars, famous sports players, gamers on April 5, 2019. Impressively, the commercial rollout of 5G has been achieved in a short span of time as it was only four months ago in December 2018 that the first successful 5G transmission took place in Korea.

The number of subscribers exceeded 100,000 within one week of service beginning, and after 25 days, 260,000 people have subscribed to 5G. The rapid increase in initial subscriber numbers compared to 4G LTE shows that users’ interest and expectations for 5G are huge.

Let’s take a look at what we have learned from the first month of 5G in Korea:

What has changed?

  • Data transmission speed
    5G enables three core use-cases – Enhanced Mobile Broadband (eMBB), Massive Machine Type Communication (mMTC), and Ultra-Reliable Low Latency (uRLLC). Of these, only eMBB is considered possible on the 5G NSA (non-standalone). The remaining two require 5G SA (standalone) commercialization. Therefore, the data transmission speed is the key to judge the quality of the 5G NSA.

Counterpoint Research used Samsung’s Galaxy S10 5G and measured the download speed using a mobile app. The highest speed was 682Mbps measured at Gimpo city, followed by 497Mbps near Gangnam subway station. Latency is about 20-40ms on average, which does not show a big difference from 4G LTE.

  • Subscription tariff increased by about 12% compared to 4G LTE
    Due to the characteristics of 5G and its use-case eMBB, users cannot experience proper 5G service with data consumption of less than 10GB per month. According to a recent announcement by the Ministry of Science and Technology, average LTE traffic reached 8.34GB per month just before 5G was commercialized. Since 5G is expected to increase data consumption at a fast pace, slim plans, which provide less than 10GB per month, are difficult for 5G use.

As such, if we look at the standard tariff plans for 5G from each carrier, on an average the rates are about 12% higher than that of 4G LTE. However, 5G plans offer more than 150GB of data per month. Of course, there are differences between carriers.

  • 5G Contents
    Preparation of related content is critical for the success of 5G as it is the most intuitive way for smartphone users to feel the need for upgrading from 4G LTE. As a result, carriers are operating a separate section on their website where users can experience 5G content. Examples of initial 5G content are ultra-high-definition media, VR/AR, and games.

What are the problems?

  • Insufficient number of base stations, difficulty in access, and coverage limitations: Seoul and metropolitan areas have the highest concentration of 5G base stations, which limits coverage.
  • 5G Quality issue: In many cases, there was no significant difference in speed compared to 4G LTE. Also, smartphones could not easily switch between 5G and 4G LTE. Further, battery consumption is about 1.5 to 2 times higher.
  • Lack of content: Even in areas where 5G has good coverage, there is a lack of content to make good use of it.

How will it do in the future?

  • Carriers: The plan is to focus on expanding coverage by the end of the year, by increasing the number of base stations while work on optimizing 5G devices and telecommunication equipment will continue. They are also trying to find suitable content that can take advantage of 5G.
  • Government: It has announced a support policy for early stabilization of 5G which includes tax benefits for purchasing 5G telecommunication equipment and support for 5G network-based projects. The government has also promised an investment plan of more than KRW 30 trillion (roughly US$25 billion) by 2022 through a ‘5G+ Strategy’. It has also designated 10 core industries and five core services related to 5G and plans to support those.
  • OEMs: Expectations are that OEMs will expand consumers’ range of purchases by launching more 5G Smartphones.
  • The government, carriers, and OEMs formed a joint task force team (TFT) to discuss technical problems in April. It will regularly discuss and announce technical issues as well as remedies such as service coverage expansion and disconnection issues.

Korea 5G Smartphone Shipments Forecast

5G Handset Shipments Forecast 2019-2025

In 2019, the first year of 5G, we expect 5G smartphone shipments to be around 1.7 million and account for 9% of the total handset shipments. We estimate the market to pick up the pace when Apple releases 5G iPhones next year. The decline in 5G smartphone price coupled with a drop in 5G component prices, expansion of product lineup, and securing related content will be important factors for market growth.

Please click here to get access to the full report “5G Rollout in Korea – The First 20 Days of 5G” found under our Emerging Tech category.

5G Applications showcased at PyeongChang Winter Olympics

The PyeongChang Winter Olympic Games 2018 were both a spectacular sports event and a live stage for cutting-edge IT technologies. This was an opportunity to highlight the commercial capability and application for 5G technology.

Samsung, Intel and Korea Telecom collaborate to bring 5G service experience to the public

5G services are still at the early stage of development, however, at the PyeongChang Winter Olympic Games, Samsung, Intel and Korea Telecom (KT) collaborated to realize the world’s first 5G mass service operation, where visitors could experience 5G services directly.

The partners provided a 4K streaming video service via a 5G network to highlight the massive high-volume and high-speed data transmission potential of 5G. KT provided the 5G data network through a collaboration led by Intel with partners including Ericsson, Nokia and Alibaba, while Samsung unveiled its 5G mobile tablet device to deliver a 4K streaming video via Intel’s base stations.

This is Samsung’s first 5G mobile device. The device worked well for the 4K video streaming service and, at the same time, offered other smart device standard functions. And it was designed to support seamless interworking between 4G and 5G services to expand its service environment even under 4G. The 4K streaming service played smoothly on the test. We did a play-back test on the 4K streaming video. While 4K streaming worked, there is still a long way to go for commercialization. High-frequency transmission loss and the service distance issues have not been fully resolved. In the showcase center, Intel’s base station was installed in the ceiling to provide the 5G network, based on 28GHz. However, the city diorama structure (shown in the photo above) had to be placed on the floor directly below the device to avoid any potential interference between the base station and the device. This suggested to us that the limitations of millimeter wave continue to be an issue.

Samsung’s 5G mobile device delivers a significant move towards miniaturization, although it has not yet achieved smartphone size. However, there are other significant drawbacks besides the size. The device is heavy in comparison with other, similar-sized, tablets, and the device became hot in use. The power source in the device was an 8000 mAh battery, suggesting low power technology for the 5G chip has not been developed yet. Nevertheless, it was operating with a download speed of around 3.7 Gb/s.

5G VR/MR Broadcasting Enables Immersive Media Service at Olympic Games

The service expected to grow most rapidly in the early stages of 5G adoption is VR/MR broadcasting. The PyeongChang Olympic Games demonstrated the feasibility of VR/MR broadcasting via 5G.

With the simultaneous scene capture of numerous cameras in PyeongChang and Gang-neung Olympic park, Intel could utilize its close-to-real time VR rendering technology to deliver VR video. This could potentially provide end-users with a 360 degrees interactive view of sports events in near-real-time. At the PyeongChang Olympics, the VR video service was not displayed to the public, but it was used for record judging and for replay on the display board inside the stadium. Although the service was only available at short-track games due to technical and budget limitations, it is easy to see how its application could be expanded in the future. This could bring to life the concept “as good as being there” as a future revenue model for 5G technology application.

Sync-view, Bobsleigh and 360° Camera

The bobsleigh event provided the opportunity for another enhanced broadcasting method enabled by 5G. The camera installed in the bobsleigh provided a real-time view of the athlete’s angle of vision. In addition, the 360° camera installed at the race track captured the entire race successfully without missing any moment. 5G made it possible to transmit this massive data in a real time, providing an even more satisfying viewing experience for TV viewers than for the live audience at the scene.

UIYAJI, Wind Village – 5G Applications for Rural Services

UIYAJI, a mountain village above PyeongChang was the site of a 5G installation built by KT, Intel, Samsung and Nokia to test the viability of 5G for rural applications. UIYAJI Village was transformed from the countryside where no prior internet connection was installed. 5G brought connectivity to the village for the first time.

The 5G network was installed in a fixed wireless mode by using the café and the educational center in the village as two major access centers. In the café, users can enjoy 5G related services, such as a tourist information service based on AR, a media wall where the gesture recognition is applied as a user interface, supporting previously filmed village image through a drone.

In UIYAJI, 5G technology is also used for a pest control system. The system can detect animals using dispersed embedded sensors and then activate a defense system that uses sound, voice, or scent to repel unwelcome animals. In UIYAJI, radar and CCTV devices are used to detect pests such as wild pigs and take appropriate actions to reduce or prevent crop destruction.

Augmented Reality (AR) services on 5G technology create another potential application – that of enhanced remote shopping experiences. The use of a 360-degree camera with an overlay of information can create a shopping environment for the buyer that is similar or even better than being physically present. This kind of service could be adjusted to suit auction type transactions with multiple buyers. Possibilities for remote auction capabilities include agricultural livestock, fish auctions, and house sales. The benefits of remote auctions include more participants and more easily verifiable information than being physically present.

Beyond PyeongChang, what next for 5G?

Korea Telecom is working with partner companies to achieve early commercialization of 5G in 2019. Through the PyeongChang / UIYAJI Village projects, KT has gained the experience to build and stabilize a 5G communication network and broadcasting network.

One of the most important challenges for KT has been to change people’s perception of the need for 5G services. Before the installation in UIYAJI, villagers were dismissive of the new technology. However, when the residents started to use the 5G services they began to realize the potential benefits to their way of life. The participation of residents has also helped the partners develop the service offering beyond the original plans.

We expect 5G to start to be commercialized by early 2020 – likely among the first adopting countries. However, we expect it will take until around 2022 before 5G-based lifestyle-changing services become available in Korea and more broadly.

Please feel free to contact us via the contact form by clicking here for further questions regarding our in-depth latest research.

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