Hong Kong used to be a leader in the global telecommunications sector. It was the first to launch a mobile service in subway train tunnels, the first to launch video-based 3G mobile services as well as the 4G mobile broadband network.
But the city appears to have lost its momentum amid rapid changes in technology. While neighbors in the region such as mainland China, South Korea and Japan are scrambling to introduce 5G mobile services, Hong Kong appears unusually quiet when it comes to preparing for the commercial launch of the new technology. It has given no signal at all that 5G is coming soon.
On Monday afternoon, the Communications Authority, which regulates the city’s telecommunications sector, announced that it is making available 580 MHz of spectrum in the 5GHz band for the provision of public mobile services on a shared basis.
In a statement, the authority said it is very proud that Hong Kong is one of the first economies to adopt the most advanced mobile technologies, such as the Licensed Assisted Access (LAA) in the 5GHz Shared Band for the provision of higher-speed public mobile services.
With a total bandwidth of 580 MHz, the LAA represents a significant addition to the existing total capacity of the 552 MHz of spectrum in the sub-3 GHz bands already assigned to mobile network operators (MNOs).
Mobile users stand to benefit from the increased service quality and capacity to be provided by MNOs through the use of the 5GHz Shared Band.
Based on figures provided by the authority, it seems that local mobile operators will see a doubling of the spectrum available for mobile services. In the United States, for example, T-Mobile was able to increase data speed to more than 700 Mbps after it launched its LTE network on the 5GHz shared band.
While the technology offers an option for mobile operators to raise their capacity, not many companies are offering 4G services on the 5GHz shared band. That’s because they worry that mobile signals could interfere with Wi-Fi signals using the same spectrum band.
There is a reason for such concerns. The new 5GHz band for mobile use is also intended for the Wi-Fi network. Mobile transmission will only take place when the Wi-Fi network is free. The weak market response to the technology reflects concerns about the issue of network interference.
Of course, mobile operators prefer to have more spectrum to boost their network capacity and provide better service to their customers.
SmarTone is the first local operator to express its readiness to apply for the shared spectrum. Hutchison Telecommunications also said it has conducted a technical trial of the LAA technology to improve the quality of its 4G services.
However, HKT, which operates the city’s biggest mobile operator, said this type of shared spectrum is no substitute for licensed spectrums such as the 700Mhz, the 3.5GHz/C-Band and the 26 -28GHz band, which the industry desperately needs in order to launch commercial 5G services as soon as possible.
In fact, mobile operators are unhappy with the Communications Authority’s failure to bring more spectrum bands for mobile operators to prepare for the commercial rollout of 5G mobile services early next year.
They need a 3.5GHz band for the mainstream 5G network deployment, but the government will not make it available for auction until next year. In the meantime, the government is preparing for the renewal of the existing 900/1800MHz spectrum that is being used by operators to provide mobile services by the end of this year.
That said, carriers are building up their war chests to be able to keep the spectrum they are using and bid for the new 3.5GHz spectrum for the 5G rollout a year later. It’s fair to say that each company must have more than a billion HK dollars in cash for the upcoming bidding war.
Hong Kong operators aim to be market leaders and provide the best service to their customers. However, the government appears to have adopted the “show me the money” approach when dealing with mobile spectrum.
Such an attitude prevents Hong Kong from achieving its goal of becoming a smart city in the 5G era.
Mobile spectrum should not be treated as land reserve. Spectrum is the basis of future network infrastructure. The government should not aim to reap huge profits from the auction of spectrums, but should collect tax from the revenue generated from the use of the spectrum instead.
Originally published at www.ejinsight.com on June 5, 2018.