Press release

There’s been quite a bit of coverage in the press about the forthcoming availability of 5G services in the UK just as there was when 4G was launched in 2013 and indeed when 3G was announced in 2003. It’s also something we’re often asked about by investors who are interested to know if we think 5G is going to affect our business.

The answer is no, but I think it’s important everyone understands the positive changes 5G brings and where it fits into the broadband landscape so we can explain its relevance to customers and investors alike.

The marketing departments of the mobile networks particularly EE and Vodafone have started to trumpet the arrival of 5G. But the cynical amongst us may think that’s because they’re keen to try and stimulate the sale of new handsets in a dwindling market rather than offer any kind of significant coverage. Very few of the existing popular smart phone models are compatible with 5G (Apple haven’t given a date for a 5G compatible iPhone and its unlikely to be this year) and as of the beginning of July 2019, Vodafone 5G is only available in the centre of 5 UK cities.

5G as it will be delivered through the cellular/mobile networks is really designed to be a mobile data product, not to support home user broadband - it’s really aimed at improving capacity and speeds primarily in city areas where there’s a very high density of simultaneous users. Think of the surges in demand created by big sporting events or music festivals in Hyde Park in the summer.

It’s very important to establish that what 5G cannot do is rewrite the physics of radio; you can’t generate more speed or capacity within a particular location or technology set without getting less of something else. One thing 5G does give us that’s useful is access to some additional spectrum but ultimately mobile 5G networks as they’re likely to be utilised in UK at least won’t increase coverage in rural areas or give rural users something they don’t have already. This is because part of the payoff you get for the benefits of 5G is that the towers and transmitters tend to have a poorer range than 3G and 4G so you need more of them.

Indeed even to maintain the coverage levels we have with 4G and make the networks 5G compatible, the mobile networks would have to roll out hundreds more transmitter masts which they’ve already said they won’t be doing. If anything, the number of cellular mobile masts in the UK is decreasing as the networks try and save costs. The high cost of the chipsets in 5G transmitters also mean that the 5G business model is very fragile in the first place, and this will further constrain growth of 5G into rural areas.

Another key point is that to deliver the headline speeds and throughput that 5G is promising it will need some very significant fibre infrastructure and backhaul to connect back to. So we’re kind of back to square one on that as the lack of real fibre in rural areas is the problem in the first place.

We also know that the mobile networks are only really dimensioning their networks to support mobile users - they simply haven’t got the capacity within their infrastructure or the spectrum available to support home user broadband, with its multiple concurrent users, HD and 4k streaming etc. So even if a few home users are close enough to a tower to be able to utilise the services with tablets or dongles, the networks, their business models and the tariffs they offer won’t chime well with home users.

So, we don’t see 5G coming along and taking market share from us. In a way it was more likely that 4G would be a more serious competitor, but we’ve found that that isn’t the case.

This because our satellite broadband proposition has gone from strength to strength in the last 2 years with speeds and data allowances increasing exponentially. We’re now able to offer 50 Mb speeds with unlimited data allowances across our whole European footprint. This is a really compelling alternative for consumers and businesses where the wired networks or fibre can’t deliver super-fast speeds.

Another key advantage of satellite broadband over 4G or 5G is that we can deliver a defined service level at a particular location – mobile networks can’t give the customer a clear SLA of what speed or performance they’re likely to get at any particular location. It’s really just a “pot luck” service. Our customers want to understand what they’re going to get from their broadband service with families relying so much on broadband for working from home and for things like online homework; customers need to be able to feel comfortable that they can really depend on their broadband connection, and satellite is still really only ubiquitous rural broadband technology that can offer that.

So, we’re at a key flexion point in both our core technologies with disruptive changes afoot.

The launch of the next generation of broadband satellites starting in December 2019 means that satellite speeds will double again and we expect to be offering 100 Mb satellite broadband services in most of Europe from the middle of next year. A truly fibre like service from the sky.

Our fixed wireless services are also going through significant change and we’re now connecting our first gigabit (hardware and services capable of delivering 1 Gbps) fixed wireless technology in the North of England with many customers connected at an initial blistering 300+ Mb utilising new 60 GHz spectrum released by OFCOM and our mmWave technologies.

In the next 2 years next generation access (NGA) satellites will see even consumer satellite broadband speeds climb to 100 Mb, 200 Mb and 300 Mb speeds with truly unlimited data allowances. So, we see satellite taking significant market share from the likes of FTTC and ADSL where we don’t offer fixed wireless networks and that is obviously very, very exciting for the business and our organic growth.

Simon Clifton
Chief Technology Officer
Bigblu Broadband PLC

- END -