U.S. Cellular expanded 5G network equipment deals with Ericsson and Nokia to now include millimeter wave (mmWave) gear and support for the regional carrier’s IoT and use of the 3.5 GHz Citizens Broadband Radio Service (CBRS) band. The expansion comes as a new report from Gartner predicts 5G network spending will double this year.
Nokia’s part of the deal includes its AirScale radio access equipment and its AirFrame open edge platform, which supports cloud radio access network (RAN). The AirScale products will support U.S. Cellular’s 24 GHz and 28 GHz mmWave spectrum bands.
The Nokia deployment will also include its Worldwide IoT Network Grid (WING) product that supports 5G-based IoT services. The vendor initially launched the WING platform in 2017, and updated it earlier this year to support 5G and edge deployments.
Ericsson is also supplying network equipment to support U.S. Cellular’s 24 GHz and 28 GHz mmWave spectrum bands, as well as the carrier’s 39 GHz 5G mmWave assets. Operators typically have access to a larger amount of spectrum in higher bands, which allows for faster network speeds, but those higher bands don’t travel as far and thus require more antennas to support coverage.
Ericsson is also supplying U.S. Cellular with equipment for its CBRS spectrum plans. The Federal Communications Commission (FCC) recently started the CBRS auction process that will allow winners to tap into those spectrum assets on a shared basis. Operators that win access will have to implement a spectrum access system (SAS) to monitor usage so it does not interfere with adjacent users. Google is one of five SAS providers approved by the FCC.
U.S. Cellular is based in Chicago and serves around 5 million customers across its mostly Midwest footprint. The carrier is substantially smaller than its nationwide rivals Verizon, AT&T, and T-Mobile US, all of which serve in excess of 100 million connections. However, U.S. Cellular has roaming agreements with those operators allowing its customers to use their devices when outside the carrier's native footprint.
Both Nordic vendors were part of U.S. Cellular’s initial 5G deployment plans announced last year. The agreement with Nokia is for five years and the Ericsson deal was described as a “multi-year contract.” The deals also call for the vendors to provide radios, software, and services that will be required to build out the 5G network across the carrier’s footprint. The carrier launched commercial 5G services earlier this year, which also included adding Samsung to its vendor quiver, and said it plans to add 5G mmWave support beginning next year.
5G Spend Set to ExplodeThe deals come as Gartner predicts worldwide 5G spending will almost double this year to $8.1 billion. That will account for more than 21% of all wireless infrastructure spending, which itself is expected to drop 4.4% this year to $38.1 billion.
Kosei Takiishi, senior research director at Gartner, noted in a report that operators are beginning to transition their 4G LTE network spending to their 5G networks. “Investment in wireless infrastructure continues to gain momentum as a growing number of [operators] are prioritizing 5G projects by reusing current assets including radio spectrum bandwidths, base stations, core network and transport network, and transitioning [4G LTE] spend to maintenance mode,” he explained.
The report noted that China will lead the world this year in total 5G investments bolstered by “cost effective infrastructure manufactured in China coupled with state sponsorship and reduced regulatory barriers is paving the way for major [operators] in China to quickly build 5G coverage.”
While the near doubling of 5G spend this year sounds impressive, according to Gartner, it pales in comparison to the 576% surge the market witnessed last year. However, the 2019 figure was starting from a much lower amount as there was very little 5G investment in 2018.
Some have noted that the ongoing COVID-19 pandemic could also impact near-term 5G spending as operators more closely guard their capex budgets.
“There’s certainly an impact here in the short term, and I think longer term there are going to be impacts,” Bob Everson, senior director of 5G architecture at Cisco, recently told SDxCentral.
Takiishi did hint to that fact in the report, though he added that China and Japan were not likely to see much slowdown.