ICT Analytical Update: 5G Developments Move Rapidly Across ASEAN

ICT Analytical Update | March 14, 2019
Authors: Shay Wester, Ella Duangkaew, Goh Jing Yi

Across ASEAN, countries are making major strides in implementing their national 5G strategies. According to statements made as of March 4 by Singapore’s Minister for Communications and Information S. Isawaran, by 2020, Singapore will roll out its Fifth-Generation (5G) mobile network technology to enhance its competitive edge in connectivity and digital infrastructure capabilities. It aims to attain uninterrupted Internet access, which is an indispensable foundation to its growing digital economy, particularly in areas of streaming services, e-commerce and cloud computing.  Minister Iswaran statedthat 5G is expected to be 100 times faster than the present 4G systems, with up to 25 times lower latency (or lag time) and as many as one million devices supported within one square kilometer, making it 1,000 times denser than is now possible. Given this extraordinary speed that enables simultaneous use of high-demand applications, 5G harbors the potential to not only generate business growth, but also radically transform business operations. To meet this 2020 goal, Singapore has started 5G trials, facilitated by partnerships between Singapore’s network operators (Singtel, StarHub and M1) and industry partners. Frequency fees have been waived by the Info-communications Media Development Authority (IMDA) since 2017. According to IMDA, public consultation on regulatory framework and policy issues will be conducted soon.

To keep pace with regional 5G developments, Malaysia is initiating trials as well. As announced by Communications and Multimedia Minister Gobind Singh Deo on March 4 as well, Putrajaya and Cyberjaya will be designated as test beds in showcasing 5G technology application in April 2019[2]. Malaysia has plans to increase such test-bedding initiatives, as well as calls for more public and private sector participation. It is expected that the Malaysian Digital Economy Corporation (MDEC) and Futurise Centre will partake in these activities; MDEC is responsible for building enabling ecosystems to fulfil Malaysia’s digital economy agenda, and the Futurise Centres drives the National Regulatory Sandbox, which is key to enabling innovation and adaptive policy-making to accelerate lab-to-market adoption for local technology solutions. While Malaysia recognizes the security concerns associated with the use of 5G technology- particularly the use of Chinese equipment- MinisterGobind affirmed the position that Malaysia “needs to embrace, think carefully, adopt as far as (it) possibly can” due to 5G’s immense potential in transforming the services industry. Given the government’s plans for Malaysia’s eventual adoption of 5G, the Malaysian Communications and Multimedia Commission (MCMC) is currently conducting a study on data security.

Other Southeast Asian countries have set targets for 5G as well. The Philippines has been testing 5G since 2016 and plans to have a 5G-ready network live for customers by 2020. In partnership with Huawei and Ericsson, PLDT wireless arm Smart Communications introduced its first 5G cell sites in Makati Central Business District and Clark Freeport Zone in Pampanga in 2018. Vietnam will also be conductin 5G trials this year, led by its largest telecommunications company Viettel, and plans to have a ready network by 2020. Indonesia tested out its 5G network during the Asian Games 2018 and is likely to roll out commercial 5G by 2020 as well. On February 8, Thailand launched a test bed for Huawei 5G technologies in Chonburi. Thailand’s test bed marks the entry of the controversial technology in Southeast Asia. Thailand’s Minister of Digital Economy and Society Pichet Durongkaveroj is also aware of the potential security risks of the technology, but has indicated that the test bed would offer Thailand a trial period to evaluate the legitimacy of security allegations before potentially moving forward with broader deployment (see more in our recent Thailand Update here). Thailand’s largest mobile phone operator, Advanced Info Service, is also testing 5G but has not indicated any definitive plans over a live commercial 5G network.

The introduction of 5G in the region is expected to boost efficiency of services, with quicker response times between networks and requests. This is particularly useful for devices that engage with massive amounts of data. It enables more efficient signaling for Internet of Things connectivity, optimizes network energy consumption with quicker processing and drives network hyper-densification which boosts traffic capacity. Beyond its impact on the services industry, 5G is also integral to progressing the ASEAN Smart Cities Network initiative, as smart cities function optimally on efficient transfer of data amongst various elements of the city, such as traffic systems, public transportation systems and weather systems. While technologies required for smart cities do exist, the capacity for technologies to operate in real-time across an interconnected network has mostly been restricted by current network standards. Therefore, 5G is likely to advance the development of smart cities in the region. Furthermore, the proliferation of commercial 5G networks will see the region reach 675 million 5G connections by 2025, championing the region’s goals for an Industry 4.0 transition. Moreover, 5G is likely to catalyze new technological frontiers, thus leading the emergence of new industries and technologies. These include autonomous vehicles and self-driving car systems, of which operations depend on low levels of latency.

It is expected that 5G implementation will be challenging due to the need to build new digital infrastructure, which incurs high deployment costs. This could result in the concentration of 5G networks in urban areas instead of rural areas, as well as higher 5G prices imposed on consumers during its initial deployment phase. Moreover, according to a 2018 report by Deloitte, 5G deployment requires a roughly 10-year sustained investment cycle, which could be difficult to attain for countries with competing development priorities. Further, another challenge lies in the varying pace of 5G deployment in different countries due to different capabilities. While Southeast Asian countries are planning to deploy 5G within the next 2 -3 years, the fact remains that majority of them are still unable to supply adequate 4G services. According to a report by OpenSignal, big cities such as Kuala Lumpur, Manila, Bangkok, Phnom Penh and Jakarta have 4G mobile download speeds ranked below the global average in 2017. Brunei has the greatest mobile penetration in the region and yet does not expect to deploy 5G before 2021.

Nevertheless, the region seems to be gearing up for a 5G-ready future, in alignment with the growing regional trend of rapid migration to mobile broadband networks and smartphones in recent years. The possibility of a seamless mobile network and end-to-end services at the right price points could be a reality, thus fundamentally changing industries and the way humans interact with technology. It will require strong leadership and close partnership between the public and private sector to shape how each country will navigate the complexities of 5G developments.