As 5G Mobile Connections Grow, Congress Should Act on Spectrum

On June 28, 5G Americas issued a press release highlighting strong 5G adoption numbers during the first quarter of 2023 for North America – the U.S. and Canada. Citing data from Omdia, the press release stated:

North America continues to assert leadership in 5G wireless connectivity, as continued adoption fuels additional demand for improved 5G network services. By the end of Q1 2023, the region boasted an impressive tally of 133 million 5G connections and a staggering 503 million LTE connections. The 5G penetration rate in the North American market is steadily climbing and currently stands at nearly 36 percent, as 14 million new 5G connections came online during the first quarter of 2023.

Additionally, 5G Americas' press release cites an Omdia forecast that 5G will be the dominant mobile technology in North America by 2025, and that there will be 601 million subscriptions in North America by the end of 2027. The press release also includes figures and forecasts for 5G growth for the globe and for other regions.

 

The 5G Americas press release doesn't cite figures or make forecasts specific to the United States. However, it is imperative that the U.S. maintain its leadership among nations when it comes to 5G services. To securing that leading position through 2027 and beyond, Congress, the NTIA, and the FCC must act to replenish the spectrum pipeline, particularly with mid-band spectrum that is ideal for supporting 5G wireless networks. 

 

In public comments filed in the NTIA national spectrum strategy proceeding, Free State Foundation President Randolph May and I urged the agency to study and reallocate for commercial use at least 1,500 MHz of spectrum. We also recommended that the NTIA prioritize reallocation of the lower 3.1-3.45 GHz band, as we well as the 4 GHz and 7/8 GHz bands. 

 

Importantly, Congress also should promptly restore the FCC's authority to conduct competitive bidding auctions for spectrum licenses. That authority lapsed earlier this year. Apparently, this is the first such lapse since the Commission was first granted spectrum license auction authority in 1993. But on May 24, the House Energy and Commerce Committee passed H.R. 3565 – the Spectrum Auction Reauthorization Act of 2023. If passed into law, H.R. 3565 would restore the Commission's spectrum license auction authority through September, 2026. The bill also would direct the NTIA to conduct feasibility studies for making spectrum in the 4 GHz and 7/8 GHz bands available for "non-Federal use, shared Federal and non-Federal use, or a combination thereof." Hopefully, the bill will soon receive a full vote before the House of Representatives. 

Ericsson Report Spotlights 5G's Second Wave

The latest "Ericsson Mobility Report" was released on November 30. The report summarizes the progress of wireless services on a global as well as regional bases, along with future growth forecasts. The report summarizes the progress of the U.S. in repurposing spectrum for wireless services, particular in the mid-band:

The US is one of a few countries that has significant 5G deployments across low-, mid- and high-band frequencies. Launched in April 2019, 5G services were first available in high- and low-bands. Ten service providers have deployed 5G on low-band, covering over 95 percent of the US population. High-band 5G services are available in 90 cities. The Federal Communication Commission subsequently allocated mid-bands over the course of several auctions during 2020–2022. Currently the three national service providers are rapidly deploying 5G mid-band networks nationwide. Around 80 percent mid-band population coverage is projected by the end of 2022. 

Most of the report's information pertaining to the U.S. is encapsulated in its data for North America:

5G is in the second wave of build-outs and user adoption. The addition of mid-band spectrums now enables superior multi-band 5G experiences for many users. In 2022, 5G adoption continued to grow strongly, with more than 140 million subscriptions expected by the year-end. High-speed internet access to homes and small businesses with Fixed Wireless Access has become the primary technology fueling fixed broadband growth in North America. 5G is also growing in the enterprise segment with wireless WAN to branch office locations and to serve ultra-mobile professions. By 2028, around 420 million 5G subscriptions are expected, accounting for over 90 percent of mobile subscriptions. 

Among the report's forecasts, 5G subscription penetration is expected to reach 35% in North America by the end of this year. And average monthly mobile data usage per smartphone is expected to reach 55 GB in 2028. 

For more statistics and projections regarding wireless services, see the November 2022 edition of the "Ericsson Mobility Report." 

Data Shows 5G Network Connections Surge Continues in 2022

A September 21 press release by 5G Americas announced that "Global 5G Connections are Doubling Every Year." Data from Omdia and 5G Americas apparently indicates that global wireless 5G connections rose to 813 million by the end of the second quarter of this year. They forecast that global 5G connections will reach 1.1 billion by the end of 2022.

The 5G Americas press release does not offer any statistical breakdowns specific to the U.S. But it does describe the march of 5G adoption in a combined "North America" category that consists of the U.S. and Canada: 

By region, North America had a total of 99 million 5G and 502 million LTE connections by the end of Q2 2022. This translates into an addition of 17 million 5G connections for the quarter – a gain of 20.7 percent over Q1 2022. Additionally, CTIA notes fast growth in 5G uptake in the United States, which now identifies 315 million Americans covered by 5G and one-third of American adults having an active 5G device. Overall, a total of 137 million 5G connections is projected to come from North America by the end of 2022.

The lion's share of 5G connections growth in North America belongs to the U.S. A January 7 blog post called attention to an Ookla report that ranked the U.S. #1 in terms of 5G network availability. This growth in 5G in the U.S. critically depends on strong private sector capital investment – a factor highlighted in a September 15 blog post by Free State Foundation Senior Fellow Andrew Long. And a replenished supply of new spectrum for licensed and unlicensed wireless use will also be needed in order to maximize the value of 5G networks for Americans. On the pressing need for more mid-band spectrum for commercial wireless use, see Mr. Long's September 22 blog post. 

CTIA Annual Survey: Record-Breaking Investment Benefits Consumers

On Tuesday, CTIA released the 2022 edition of its annual wireless industry survey. Among other milestones, it documents an unprecedented level of investment, accelerated cell-site deployments enabled by regulatory reforms, the explosive adoption by consumers of 5G devices, inflation-defying price decreases, and the rapid rise of fixed wireless as a viable home broadband alternative.

Specific findings from the survey include the following:

In 2021 alone, U.S. wireless carriers spent almost $35 billion "to grow, improve and run their networks." As the following chart illustrates, that record-breaking total represents the fourth straight year of increased annual investment.

Thanks to efforts by the FCC and the states to streamline siting regulations, 69,543 cell sites – 62 percent of the post-2016 total – were constructed in the two years between 2019 and 2021.

5G service today is available to 315 million Americans. And consumers are adopting this mobile broadband technology at a brisk pace: the total number of deployed 5G-capable devices grew by over 500 percent during just the past year. Consequently, one in three adults now have a 5G-capable smartphone or other device.

While consumer prices overall have increased by 94 percent thanks to "historic" levels of inflation, prices for unlimited data plans have fallen by nearly half since 2010.

5G fixed wireless quickly has emerged as a viable competitive alternative for home broadband service: over 40 million households already have access to this option.

Highlights from CTIA's 2022 Annual Survey are available here.

Data Shows 5G Network Connections Surged Again in 2021

A March 23 press release by 5G Americas titled "5G Forecast: 1.3 Billion by Year-End 2022" found that North America (U.S. and Canada) had a total of 72 million connections by the end of last year. That amounts to an addition of 54 million 5G connections in 2021, and a year-over-year gain of 292%. The finding is based on data collected by Omdia. Additionally, 5G Americas expects total connection in North America to climb to 516 million by the end of 2026. Furthermore, North America "had 514 million LTE connections by the end of 2021, which represents near full market maturity." For more findings and forecasts, see 5G America's press release. (No U.S.-specific numbers were provided.) 

Free State Foundation Legal Fellow Andrew Magloughlin and I addressed the significance of 5G's rapid deployment to the communications marketplace and its potential to further benefit consumers in the years ahead in our Perspectives from FSF Scholars, "The Broadband Internet Services Market in January 2022."

Vast Majority of U.S. Consumers Now Buying 5G-Capable Smartphones

According to a March 16 press release by Counterpoint, sales of 5G-capable smartphones reached 51% of global smartphone sales in January 2022, overtaking sales of 4G-capable smartphones. But 5G smartphone sales penetration reached 73% in North America in January of this year.  

While 5G smartphone sales are now predominant, 4G connections till outnumber 5G connections. But as Free State Foundation Legal Fellow Andrew Magloughlin and I point out in our Perspectives from FSF Scholars published earlier this year titled "The Broadband Internet Services Market in January 2022," growth for 4G LTE has already peaked. As we observe in our Perspectives, 5G Americas projects that 5G will constitute the majority of mobile connections in 2024. And if future 5G connections figures match trends in 5G smartphone sales, it is a safe bet that North America – and the U.S., in particular – will be a majority 5G-connected nation sooner than the global average. 

 

In our Perspectives, Mr. Maglouglin and I point out that "[o]ne of the most significant developments in the broadband Internet services market in 2020 and 2021 was the rapid rollout of 5G wireless networks and accelerated adoption of 5G services by U.S. consumers." Continuing rapid deployment of 5G networks -- evidenced by January 2022 sales penetration figures for North America provided by Counterpoint -- is important to the welfare of U.S. consumers because "5G networks are more capacious than 4G LTE networks and they are expected to eventually deliver average speeds about ten times faster than LTE networks, with peak speeds as much as 100 times faster."