Huawei’s Bold 5.5G Vision: Balancing Network Evolution and Investment Challenges

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Chinese equipment manufacturer Huawei is pressing for the continued advancement towards the implementation of 5.5G technology, advocating for significant investment in network infrastructure. The firm is keen on unfolding its vision for 5.5G, also known as 5G-Advanced, which it envisions to be the crux of future network infrastructure progress.

In a bid to underscore its vision, Huawei’s rotating chairman Ken Hu emphasized, “Technology is changing so fast, and new demands are evolving every day.” He continued his address by asserting the need for network evolution and preparedness for the future, stating, “Our industry as a whole needs to get ready for the future and maximize the value of investments in 5G – and that’s why we’re working so hard on 5G-Advanced.”

Li Peng, corporate SVP and President of Huawei’s carrier business group, further elaborated the fundamental capabilities of 5.5G networks. According to him, these comprise of a minimum of 10-Gbps downlink and 1-Gbps uplink, support for 100 billion IoT connections, native AI capabilities, deterministic networking, and integrated sensing and communication, to name a few.

Yet, the implementation of these features on a global scale seems a daunting prospect. While countries like the United Arab Emirates already boast impressive 5G download speeds of 557.6 Mbps, far surpassing the global median speed of 168.3 Mbps reported by Ookla, a substantial network densification is required for other regions if they plan to catch up.

Moreover, these challenges are being magnified by trends in capital expenditure (capex). Notably, Dell’Oro has predicted a 7% fall in global telecom capex, which covers both fixed and wireless network spending, between 2022 and 2025. This also includes a predicted decline in global RAN revenues over the next five years as 5G investments fail to compensate for the slump in LTE spending.

Even the advent of 6G seems to offer little respite. The Next Generation Mobile Network (NGMN) Alliance emphasized that 6G should not trigger a hardware refresh of 5G RAN infrastructure, further magnifying the gaps in telco spending.

Considering these realities, vendors like Huawei are starting to pivot to cater to the enterprise market. As implied by Hu in his address, they are urged to bolster their capabilities in cloud, industrial application development, and end-to-end system integration with an eye on B2B market opportunities.

To quote Hu, “Looking forward, we have lots of work to do. We need to enhance our capabilities, evolve the technology, create better user experience, scale up in the industry, and maximize the value of our investment on 5G.” Companies like Huawei, it seems, are recognizing that laying the groundwork for 5G-Advanced may warrant a deeper immersion in the changing market needs and enterprise-focused strategies, rather than solely relying on network infrastructure investment.

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