Mobile data-only network operator Rain’s activation of Africa’s first commercial 5G network yesterday is a demonstration that 5G is possible in South Africa without government’s intervention.
This is according to analysts after the company announced its commercial 5G offering is available to selected existing customers.
SA’s big mobile operators, such as Vodacom and MTN, are unable to launch 5G services until more spectrum is licensed to them by the communications regulator, the Independent Communications Authority of SA (ICASA).
Rain will deploy its 5G wireless data network in certain parts of Johannesburg and Tshwane by leveraging its 4G data networking infrastructure to build the 5G network in its regulated 3 600MHz spectrum band.
Professor Louis Fourie, deputy vice-chancellor: Knowledge & Information Technology at Cape Peninsula University of Technology, says the licensing of the higher 5G frequencies (24.25 to 86GHz) will only be considered by government after the World Radio Communication Conference in November.
“However, there is no reason why ICASA cannot already license underutilised and unallocated bands in the 3.3 to 3.8 and 26GHz bands,” Fourie says.
Khaya Dlanga, Rain’s chief marketing officer, says: “Selected customers in Rain’s 5G coverage area have been invited to be the first to purchase ultra-fast 5G, unlimited Internet for only R1 000 per month.
“The speed and capacity of the 5G network, together with the latest WiFi 6 technology in the router, will enable Rain users to stream high-definition video to multiple devices simultaneously,” Dlanga says.
In February, Rain announced it had launched the first 5G commercial network in SA in partnership with Huawei. Last year in November, it demonstrated its 5G capabilities in Cape Town, using both Huawei and Nokia equipment, and told ITWeb it had plans for a commercial 5G service to be live in early 2019.
SA’s broadband evolution
World Wide Worx MD Arthur Goldstuck says while Rain’s 5G is not very significant for consumers, it is still a significant moment in the evolution of broadband in SA.
He notes that many will criticise Rain 5G’s limited speed and geography, with only a few narrowly-defined areas of coverage.
“However, it is a start, and someone has to start, given that we can’t rely on government to come to the party any time soon.
“Telecoms in this country is mired in regulatory sloth, and after promises of freeing up spectrum needed for high-speed broadband, it is playing the same old games. This means 5G must happen despite government, not because of it.
“So, much in the way that MTN and Vodacom ‘refarmed’ 3G spectrum to work on 4G equipment, Rain is ‘refarming’ 4G to behave like 5G.”
This obviously means there are compromises on speed and capacity, but it will be a good demonstration of what is possible, says Goldstuck.
“Rain will, therefore, have a good head-start in learning the ins and outs of 5G in practice, meaning it will be able to invest time and effort in optimising its 5G technology and offering ahead of the rest of the market.”
He points out that Rain’s 5G offering does not yet represent a competitive challenge to MTN and Vodacom, as both have near blanket coverage of the country with 4G, and “we still have not seen saturation of the 3G and 4G market, let alone demand for 5G.
“MTN just rolled out a fixed-LTE service which, although not uncapped, offers highly competitive pricing. For now, many consumers would prefer to pay less than half the price of the Rain offering for a capped service that still provides high usage and reasonable speeds.”
Goldstuck says the Rain offering is in effect a fixed-mobile offering, and will compete more directly with fibre-to-the-home, where similar pricing is available for uncapped offerings, although at lower speeds.
“The question consumers will ask is, ‘what can I do at 200Mbps that I can’t already do at 100Mbps or 50Mbps?’ Once Rain can answer that question, it will have a more compelling offering.”
Duopoly challenge
Christopher Geerdts, senior associate at BMIT, believes the launch is very significant because it positions Rain and SA up with some of the leading global mobile operators.
“It is also exciting to see Rain challenging the tight duopoly that has for so long characterised the local mobile market. We can also look forward to the increased choice that home and office customers will enjoy when it comes to high-speed, uncapped broadband services.
“This offer could well disrupt the market in suburbs which already have fibre, and bring early relief to customers in areas still waiting for fibre coverage.”
However, Geerdts says 5G devices remain expensive. “It seems Rain may be subsidising these for its early customers, but in the long run, device prices need to come down to support customer demand.”
He points out SA is far behind in terms of assigning spectrum for LTE and 5G. “While other countries have already held 5G auctions, South Africa does not even have a process finalised for assigning its 4G spectrum.
“The saving grace would be for ICASA to capitalise on the delay by combining available spectrum into one 4G/5G auction process, so that operators can leapfrog into 5G deployment,” Geerdts notes.
“South Africa should also examine the wasted TV broadcasting spectrum that has been set aside for years for two new broadcasting licences, since it is most likely these will never be awarded. The US has already put this additional spectrum to good use in providing rural LTE coverage, upgradable to 5G.”
He adds Rain has enough spectrum now to support its uncapped 5G offer, and hopes the company will invest in rapid coverage.
“Telkom can use its spectrum for LTE-Advanced, as it does currently, or it can repurpose some of it for 5G if it so chooses. ICASA should also urgently consider upgrading licences for Telkom and Liquid Telecom regarding their old WiMax spectrum.”
Fixed-wireless solution
Dr Charley Lewis, an independent analyst, comments that Rain’s 5G offering is essentially a fixed-wireless access point-to-point solution.
“It would appear to offer limited mobility for devices such as laptops connected to the router, presumably via WiFi. From what I read, this is not an offering of full-on 5G mobile connectivity. In any event, there are very few 5G-capable handsets on the market anywhere, let alone in SA.”
Lewis points out 5G mobility solutions will require significant capital investment, both in the high-volume fibre backhaul required and to dramatically increase the base station density needed.
“As things stand, I don’t see a compelling user or business case in South Africa to roll out a mobile 5G offering.”
He adds that 5G spectrum is there but getting access to that spectrum is the difficult part. “Rain has the necessary spectrum, in some of the right bands (such as 3 600MHz), thanks to what it inherited from WBS and MultiSource.
“No one else does though. Barring any refarming opportunities presented by the digital dividend (still tied up in DTT delays) and ICASA’s forthcoming high-demand spectrum auction, everyone else will have to wait until at least the end of 2020, given the minister’s recent policy direction which effectively hamstrings ICASA in making any 5G-specific spectrum available.”
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