The telco announced its planning for a 2020 launch of 5G in a briefing paper which it says is aimed at informing investors of its 5G intentions, help customers and stakeholders understand more about 5G, and to address key considerations for policymakers.
Spark has also announced plans to launch a 5G Innovation Lab in Auckland’s Wynyard Quarter Innovation Precinct later this year that will allow partner companies to test and develop applications over a pre-commercial 5G network.
Managing director Simon Moutter said Spark’s technical and network planning for 5G was advancing after successfully conducting outdoor and indoor trials earlier this year.
“We have already begun a build program to increase the number of cell sites in our existing mobile network – which will enable us to meet near-term capacity demand as well as lay the groundwork for network densification required for 5G.”
Moutter said the current competitive market model, in which multiple wireless network operators compete against one another to grow their customer bases through product and service innovation and pricing, represents a good blueprint for the way 5G can be rolled out in New Zealand and would provide for more investment predictability and certainty over the coming decade,
And Moutter said 5G would enable Spark to provide additional capacity at a lower incremental unit cost than under 4G and 4.5G: “This means that once 5G is available to deploy, we will have a strong commercial incentive to rapidly build 5G network capability as the primary means of keeping ahead of growing customer demand for more data at faster speeds.”
Spark has said its network spend will be diverted from 4G capacity expansion into 5G as soon as the necessary spectrum is available, and the telco expects to fund 5G network development (excluding spectrum and any material move towards widespread rollout of new cell sites using high frequency mmWave band spectrum) within its existing capital expenditure of 11%-12% of revenues.
Moutter said that by 2020, Spark expects its wireless-network specific capex to be between 25%-35% of its overall capital expenditure, up from 25% in the year ended 30 June 2017.
Moutter says Spark is already making decisions that are contingent on securing additional 5G spectrum and is having to make those decisions “in the absence of any clear government policy on when that spectrum will be available or in what bands”.
He said the allocation processes for the two most likely spectrum bands — mid frequency C-band and high frequency mmWave band — should be completed as soon as possible, to ensure 5G services can be delivered in time for the 2020-21 America’s Cup in Auckland as an international showcase opportunity.
“In addition to these bands, low frequency spectrum (below 1000MHz) will be required to deliver 5G services on a pervasive basis into rural areas (outside of small provincial towns). The government’s current work to define 600MHz spectrum as a band for potential 5G use should continue at pace,” Moutter said.
He said it was important for policymakers to recognise 5G is not a standalone technology or solution.
“It will operate together with previous generations of wireless technology and will be deployed as an overlay of existing network infrastructure. Therefore, policy settings need to support network operators having control over the evolution of their wireless network.”