5G networks are quickly unfolding throughout markets in East Asia. The region constitutes 90% of worldwide 5G connections to date. Rollouts have been slower elsewhere, including in the U.S., the second largest 5G market outside East Asia, even as telecommunications giants race to buy up spectrum there. According to the Wall Street Journal, this is due to a number of factors, including:
- Infrastructure. Currently, there isn’t enough space within the portion of the airwaves that balances fast speeds with far-reaching signal ranges. Additionally, high-band spectrum depends on high-density cell towers, which take time and money to build. As a result, telecommunication companies have become focused on buying mid-band spectrum in government auctions, much of which is already eaten up by government agencies, such as military and weather communication services.
- Equipment. Unlike 4G, 5G depends on more advanced equipment to transmit data at higher speeds. Today, there are only five major wireless network equipment providers in the U.S., down from about twelve a decade ago. Not only does this make U.S. companies more dependent on foreign equipment makers, it means carriers must also deal with complex regulatory requirements associated with buying in foreign countries.
- The absence of a “killer” 5G application. “Killer app” is market slang for an application that entices users to adapt a new application. While mobile video played a huge role in attracting consumers to 4G, there is no equivalent must-have app luring them to 5G.
Given these challenges, U.S. businesses are more likely than consumers to become early 5G adopters. A business, for example, could dramatically improve operations by building its own private 5G network, setting up the foundation for an advanced Wi-Fi network with enhanced speed, connectivity, accuracy, and security. However, such private networks could prevent telecommunications companies from generating enough revenue to build nationwide 5G infrastructure, further stalling rollouts.
U.S. Lawmakers Introduce Legislation to Expand 5G Rollouts in Europe
Meanwhile, U.S. legislatures have recently reintroduced a bill allowing the U.S. Development Finance Corporation, a federal agency charged with funding private development projects overseas, to finance 5G infrastructure development in 22 nations throughout Central and Eastern Europe. The legislation backs an initiative called the “Three Seas” organized by a dozen countries in these regions to secure telecom space.
If enacted, the Transatlantic Telecommunications Security Act would require the U.S. State Department to work with the Development Finance Corporation and the U.S. Trade and Development Agency to determine 5G projects worth funding in the countries. These projects would update 5G networks with the latest hardware or software, provide market transparency, prevent or replace potentially compromised equipment, and boost telecom integration in the selected regions.
Countries covered in the Act include: Albania, Austria, Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, the Czech Republic, Estonia, Greece, Hungary, Kosovo, Latvia, Lithuania, Moldova, Montenegro, North Macedonia, Poland, Romania, Serbia, Slovakia, Slovenia, and Ukraine.
While 5G rollouts have been slower outside Eastern Asia, the technology will continue to expand internationally, bringing with it high-speed internet to people and businesses all over the world.
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Resources
Council, Jared. (25 May 2021). Why the U.S. Rollout of 5G Is So Slow. The Wall Street Journal.
Nyczepir, Dave. (21 May 2021). Lawmakers reintroduce bill to finance 5G projects in 22 European countries. FedScoop.
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