What’s up with… e&, VMO2 & Vodafone, 5G growth

• e& builds giant private 5G network for energy firm
• VMO2 eyes spectrum gain from Vodafone UK  
• Global 5G connections near the 2 billion mark

In today’s industry news roundup: Middle East giant e& is helping Abu Dhabi’s energy behemoth Adnoc build a massive private 5G network that promises significant gains; Virgin Media O2 agrees to help out its network sharing partner Vodafone UK if the latter’s merger with Three UK gets the go-ahead; global 5G connections are almost at an impressive 2 billion, but the return-on-investment silver bullet is still nowhere to be seen; and much more!

Middle East giant e& is building what it describes as “the energy industry’s largest private 5G wireless network, spanning 11,000 sq km” for Adnoc, an energy and petrochemicals group that is wholly owned by the Emirate of Abu Dhabi. According to the companies, the network will “deliver high-bandwidth connectivity across Adnoc’s onshore and offshore operations… [enabling] Adnoc to further integrate its advanced artificial intelligence (AI) solutions at its most remote facilities and reduce costs through automation, improve efficiency, minimise emissions and enhance the safety of its people.” The construction of the private network is expected to be completed next year and, once completed “will relay information from sensors embedded in more than 12,000 wells and pipelines to autonomous control rooms, to help make real-time recommendations to increase the lifespan of these assets and ensure safety in the field. The network will also allow for the digitalisation of wellheads and provide end-to-end visibility over operations, thereby driving productivity across the company’s entire value chain,” stated the companies in this announcement. They also claim that the network is “expected to generate $1.5bn (AED5.5 billion) in value during its first five years of operation” by enabling autonomous operations, optimising production and reducing emissions: Needless to say that headline-grabbing number was not itemised or further explained.  

Virgin Media O2 (VMO2) is lending a helping hand to its domestic competitor, Vodafone UK, by agreeing a spectrum deal that addresses regulatory concerns from the latter’s proposed merger with Three UK. The agreement stipulates that VMO2 will acquire, at market value, spectrum from the new entity (the result of the merger of Vodafone UK and Three UK, currently referred to as MergeCo) subject to completion of the amalgamation, which is currently under investigation by the UK Competition and Markets Authority – CMA). According to VMO2 and Vodafone UK, this will result in a UK telco market that comprises “three scaled mobile network operators, each with better alignment of spectrum holding.” Furthermore, they claim that the deal will ensure “quality mobile connectivity, choice and [will mean] competition is enhanced” through a combination of MergeCo’s commitment to invest £11bn in its network over the next decade and VMO2’s £2bn annual investment in its networks and services. But it is not only customers that stand to gain from the deal – according to the two operators, businesses, including mobile virtual network operators (MVNOs), will also benefit as they will have access to “a choice of three high-quality, scaled wholesale competitors, further supporting an already thriving MVNO segment in the UK.” In their statement, the two operators also claim that their agreement reduces “the current imbalances in spectrum holding” between the UK’s mobile network operators, which “will enhance competition in the mobile market allowing MergeCo and Virgin Media O2 to provide increased capacity, speeds and greater coverage for their customers.” The agreement is part of an extension of an existing mobile network sharing one. “The proposed merger, together with this agreement, will boost competition by establishing a strong third player in the UK mobile market and will improve the balance of spectrum holdings, levelling the playing field between the UK’s mobile operators,” said Ahmed Essam, Vodafone CEO for European Markets. According to VMO2’s CEO, Lutz Schüler, the agreement “addresses the issues we have voiced and the CMA outlined in its initial decision, and will now continue our engagement with the regulator in this spirit.”

There were almost 2 billion 5G connections globally at the end of the first quarter of 2024, during which the total increased by 185 million, according to research group Omdia and industry lobby group 5G Americas. Uptake of 5G services has been strong in North America, where there are 220 million 5G connections, accounting for 32% of all cellular connections in the region. And as you’d expect, the numbers come with quite a bit of flag-waving from the industry organisation. “The wireless technology sector continues to demonstrate its strength and significance through rapid adoption and sustained robust growth globally. North America remains at the forefront of 5G implementation,” trumpeted Chris Pearson, president of 5G Americas. That’s an arguable claim, but perhaps not really that important if there’s not much to show for the relatively speedy uptake of 5G services. What does matter is whether 5G services are good for customers, the service providers and the broader telecom sector, and the consensus right now is that 5G has been something of a disappointment. While there may indeed be nearly 2 billion connections globally, the benefits are hard to spot: Network operators the world over are still searching for a great return on their 5G investments and looking for a way to generate new revenues and business opportunities from the introduction of the latest cellular generation. 5G-enabled fixed wireless access has been trumpeted as a great ‘use case’ and may be deemed a success in markets such as the US, but it’s only a small part of the tip of the iceberg and not an answer to the bigger question of what 5G might ultimately be good for. If 5G Americas, or any other industry body, can point to hard evidence that 5G is delivering quantifiable, game-changing benefits to the broad ecosystem in general, that would be meaningful. Hitting 2 billion connections is a nice milestone but in some ways highlights that enhanced mobile broadband services alone don’t make the economic case for 5G. Maybe by 2028, when Omdia expects the 5G connections global total to reach 7.7 billion, the industry will have figured out how to make a decent return from its massive investments.   

Australian telco Optus is to use Cisco security technology to boost its defences in the hybrid working era. With a new multi-year collaboration unveiled today, the pair plan to offer enhanced network security and data security services for Optus Enterprise and Business customers that tackle the “complexities associated with hybrid workforces”. Optus noted that more than a third of Australians regularly work remotely, leading to organisations increasingly adopting software-as-a-service (SaaS) public and on-demand network services. “This shift, combined with increasing vulnerabilities, exposes systems and users to potential significant risks across devices and software,” the telco added. The companies will increase their investment in expanding the telco’s Integrated Network Operation Centre and Security Operation Centre, which is set to result in “secure-by-design networks”.

Canadian operator Rogers Communications has conducted a trial deployment of 5G cloud radio access network (RAN) technology in Canada. The trial, which took place on 1 July to mark Canada Day, was carried out with its vendor partner Ericsson and, according to the telco, is the first time the technology has been deployed over a commercial network at a live event in Canada. “Cloud-native technology is a critical component in the next generation of wireless networks and we are proud to have completed Canada’s first deployment of 5G cloud RAN technology at a major live event,” noted Ron McKenzie, chief technology and information officer at Rogers. The Canadian telco explained that cloud native will enable it to respond more quickly to wireless consumer and enterprise market demands, and will offer improved network reliability, energy efficiency and 5G advancements. Find out more

Wireless backhaul transport equipment vendor Aviat Networks has acquired industrial wireless access solutions specialist 4RF for an undisclosed sum. Wellington, New Zealand-based 4RF has developed a portfolio of products, including narrowband point-to-point/multipoint radios and private 4G/LTE and 5G routers, that have been designed specifically for critical infrastructure networks, such as utilities, oil and gas, mining, public safety and the military. Austin, Texas-based Aviat says the acquisition takes it into new markets, specifically the narrowband connectivity sector, one that Aviat believes to be worth about $200m per year, and the cellular router market that, according to Berg Insight, is currently worth $1.4bn but will grow to be worth $2.5bn by 2027. Aviat last year bulked up with the $70m acquisition of NEC’s wireless backhaul business: It previously failed to acquire fellow microwave backhaul vendor Ceragon in a bitter $235m takeover battle in 2022. 

- The staff, TelecomTV