Samsung getting a foothold in the local telco equipment market with its supply deal for Spark’s Christchurch 5G network brings quite a bit to unpack in terms of technology and business models.
First, it’s a multi-vendor deal with Sweden’s Ericsson and US network giant Cisco providing gear for Spark’s Christchurch core network. Samsung supplied the radio access network (RAN) which connects user devices to the core.
Although Christchurch is the first implementation in the southern hemisphere for Samsung, the Koreans have been beavering away at 4G and 5G network tech for more than a decade.
In 2013, long before 5G became standardised, Samsung trialled data transmissions in the 28 gigahertz millimetre wave (mmWave) spectrum in New York City, using adaptive arrays of transceivers with 64 antennae. If that sounds complex, that’s because it is: synching scores of little mmWave radios with short range and no building penetration is an engineering challenge and a half.
From thereon, Samsung hit it off with US telco giant Verizon which is clearly happy with Samsung. The Korean company ousted the telco’s traditional supplier Nokia in September last year and won a massive $9.3 billion order for 5G RAN equipment, until 2025.
The Five-Eyes geopolitical banhammer on Huawei and ZTE gave Samsung an opening in the New Zealand market, where telcos under constant cost pressure would have felt green around the gills when suddenly only there were only two main equipment suppliers to choose from, Nokia and Ericsson.
Samsung’s RAN looks like a modern design with virtualisation. This is when developers use code to implement logical functions that traditionally were done with electronic circuits.
Spark and Samsung used network function virtualisation (NFV) for the Christchurch 5G infrastructure, but not software defined networking (SDN) even though the two usually go hand-in-hand.
Samsung’s head of networks Todd Selwyn explained that running the virtual control functionality in the cloud (that is, a Spark data centre) costs more upfront, but the operational costs are lower.
Virtualisation benefits from economies of scale that compute clouds bring; it is where the telco industry is moving through initiatives like OpenRAN for 5G.
Interestingly enough, the Christchurch RAN deployment is a proprietary Samsung one, even though the Korean company is an OpenRAN member.
Virtualisation is much more flexible than hardware-based solutions: it’s easy to fix bugs, and to upgrade and add features through code changes, instead of having to replace physical electronics.
For example, the virtualisation means Samsung can upgrade from the current 5G Non-Standalone (NSA) mode to Standalone (SA) mode.
NSA means control functions, calls and texts go over the existing 4G network, and data over 3.5 GHz 5G.
Running older and newer radio networks simultaneously is suboptimal. When SA arrives, it’ll be 5G end to end, which is faster and more responsive, especially if at some point mmWave is added to the mix.
Spark technology lead Renee Mateparae said the telco’s engineers will learn from virtualisation and pick up new skills.
It may come as a surprise that mobile is less of a focus for Spark’s 5G than fixed-wireless (FW) broadband. In fact, 5G FW is something of a regulation buster.
Thing is, telcos like to own access networks to customers as it gives them more control and bigger margins.
Spark and Vodafone are unhappy with having to pay Chorus for regulated, equal open wholesale access to fibre broadband to homes and businesses. They don’t like the proposed pricing of unbundled UFB either.
The “fix” here for the telcos is unregulated 5G broadband networks.
Wireless broadband is easy and quick to deploy. Customers call Spark, commit to $95 a month for an uncapped service, or $75 for a capped one, get sent a 5G modem, plug it in and off they go.
In fact, you might not even have to be a Spark customer directly. Mateparae said Spark intends to wholesale access to the 5G FW networks. Power companies are interested in this, and it’s a safe bet there will be more electricity, broadband and mobile bundle offers coming our way soon.
Tempting as that sounds since there’s no wait for Chorus to come and trench with fibre cable laying and installing an optical termination unit, there are some big caveats to watch out for.
Radio-frequency spectrum is a finite resource. Despite the amazing tech behind 5G, fibre will provide better and more consistent performance with fast upstream speeds, if you use a competent internet provider.
Not taking up the time-limited free UFB installations could come back and bite customers who will only have FW connections to choose from. Given how important broadband connections have been during the lockdown for many, losing out on subsidised fibre to the home in favour of marginally cheaper wireless is probably not the best outcome.
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