The definitive implementation of fifth generation technologies – or 5G technology – for communications is imminent. Along with the massive expansion of infrastructure required to strengthen and generalise its use among the population. Both neutral operators, such as lyntia, and key players in the wholesale telecommunications sector have been preparing for this moment for years. And they’ve done so despite the high costs the expansion of networks entails for the latter.

By 2018, public spending on the 3.5 Ghz frequency already amounted to a total direct investment of 437 million euros, a figure that could reach 1,400 million including fees and maintenance over the full 20-year tender. The second digital dividend and the release of the 700 Mhz frequency will mean a second significant payment in the first quarter of 2021.

This launch was scheduled for May 2020 but has been delayed by the COVID-19 crisis, giving the sector a little more room for manoeuvre. Nevertheless, the context of the pandemic itself has forced many of Spain’s telecommunications wholesalers to accelerate their strategic development plans.

Short-term realities coupled with our post-COVID-19 ‘new normal’ will together raise the bar for operators and shorten their time frames for reacting. The new prominence of remote working, the pervasiveness of e-commerce and the many new habits we’ve developed around digital consumption will force them into offering end users ample bandwidth, as well as stability, security and speeds like never before.

Investing isn’t the only challenge for 5G

Although significant, the financial outlay required for 5G technology isn’t the only concern for stakeholders in the telecommunications sector. Its implementation also requires the effective development of some ‘backbone’ aspects of the smart city concept: cloud security, universal connectivity, smart software, mobility, waste management and urban planning, alongside artificial intelligence, to name just a few. Smart cities are still a developing and evolving market with an uncertain future.

It remains to be seen whether or not all administrations will come to understand, accept and face all the challenges posed by this important change in model. And if telecommunications operators themselves are willing to work towards a future where collaboration is absolutely essential. According to a report from Spain’s National 5G Observatory (ON5G), ‘5G Cities: A Smart Future’, “the planning, roll-out and operation of a smart city will require a wide range of knowledge, from networks and data analysis software, all the way through to cloud and edge network design. It will be hard for a single contractor or lone municipal entity to develop such a wide range of skills unaided”.

Neutral operators as agents of change

As a result, a future is being drawn in which collaboration is vital. And neutral operators will be a good choice of port for weathering the storm. In fact, they already are, given investment needs are so high. And this will only become more relevant as you take into account the fact that, when 5G technology is first implemented, they are able to offer greater coverage, speeds and connection capacities. But also in relation to major peaks in data consumption by users and companies alike, which in turn requires solid network infrastructure in the hands of service providers.

This ‘snake biting its own tail’ type scenario can significantly increase costs for telecommunications companies, who are already facing fairly high investments in the current strategic development phase. The Mobile World Live portal has prepared a report entitled ‘Accelerating 5G roll-out with spectrum sharing’, in which it confirms that for a traditional form of deployment, such as 4G in its day, the required levels of investment will be prohibitive and unsustainable. For this very reason, operators must rely on new network architectures, as well as a virtualisation process executed on software that facilitates development.

Neutral operators are promoters of this change, the perfect partners for the new landscape and an essential resource to ensure costs are not as prohibitive as they might otherwise be. lyntia is a neutral ‘carrier of carriers’ for local and international operators alike, guaranteeing full confidence and coverage through its own state-of-the-art fibre optic network. As a neutral operator, it works to stimulate the market, promote competition and help operators face investment optimisation challenges head on.

Investment will be high in the early stages of implementing 5G technology, that’s undeniable. But each opportunity for collaboration and savings – such as those offered through the infrastructure and technical support of a neutral operator like lyntia – can represent significant competitive advantages for telecommunications operators and the essential ingredients of success in both the short- and medium-term.