Chapter 4 - United States and 5G

Chapter 4: United States and 5G
1. I. Misconception of 5G in the United States
2. II. Qualcomm

Chapter 4: United States and 5G

While the Chinese 5G network implementation is being funneled through Huawei and their research and development team, the American companies are working to research and develop their own 5G networks and technology free of government funding.

This section will detail the common misconceptions surrounding 5G networks especially when it involves the 5G capabilities of US-based cellular networks such as Verizon, AT&T, T-Mobile, and Sprint. This section will also discuss the 5G capabilities of Qualcomm, an American company which currently stands as Huawei’s main competitor for 5G infrastructure.

I. Misconception of 5G in the United States

With the rollout of 5G upon us, many US companies are claiming to have the fastest 5G in America. This statement of “Nationwide 5G” has been claimed by all the major cellular providers on billboards, tv commercials, and internet ads. Yet, as they all make this claim, none of them are really telling the truth. Better put, they are hiding the real truth from their customers. Many have done testing on the 5G capabilities of these companies, and their findings are very consistent: 5G, currently, is not faster than 4G for the most part; and if it is faster, it does not have the capabilities that the true 5G networks will have.⁸¹ One study, which went to 26 different cities that have 5G on all three major US carriers, and they found “that AT&T’s and T-Mobile’s 5G feels a lot like 4G, and while Verizon’s 5G feels radically different, it has very little coverage.” ⁸³ This is because the supposed “5G” that is being released is, for the most part, rebranded 4GLTE or enhanced 4G networks, that do not have the full capabilities of a functioning 5G network.

⁸¹ Segan, Sascha. “What Is 5G?” PCMAG, PCMag, 25 Feb. 2021, www.pcmag.com/news/what-is-5g.

⁸² Segan, Sascha. “What Is 5G?” PCMAG, PCMag, 25 Feb. 2021, www.pcmag.com/news/what-is-5g.

For example, Verizon has fast, high-band 5G in parts of 35 cities, with online coverage maps. T-Mobile currently has a slow nationwide low-band 5G network that covers most of the country; mid-band in five cities, and high-band in seven cities. AT&T has slow low-band across most of the country and high-band in 35 cities, which it doesn’t give maps for and is unnecessarily confusing about the coverage of. It calls the low-band “5G” and the high-band “5G+.” ⁸³ To make this clearer, we do have 5G technology in the United States, but we don’t have the 5G experience; meaning we do not currently have the capabilities and networks in place to see real improvements in 5G over 4G.⁸⁴

The truth is, “5G is still being developed, and commercial rollout in a limited fashion won’t begin in earnest until next year; the first true 5G networks, which will deliver all the whiz-bang features the technology promises, probably won’t arrive until 2025 at the earliest.”⁸⁵ 5G itself is not a “magic bullet” as many think it is, it’s wrong to assume 5G will immediately make everything faster. If I get a 5G phone right now, even if I live in a 5G network, I’m unlikely to notice much of a change. That is because 5G is really an enabling technology, and for 5G to have a big impact, it requires multiple ‘complementary technologies’ to come along with it, which are not in place yet.”⁸⁶ While the earliest “5G experience” will not begin until 2025, many US customers believe that their phones are using 5G technology. In fact, “one in three Americans think they already have 5G, according to one study from 2019. The results showed that 47% of AT&T subscribers who own iPhones think their device is 5G-capable. AT&T’s misleading 5G Evolution logo (5GE) to describe service that’s really just advanced LTE, probably aided

⁸³ Segan, Sascha. “What Is 5G?” PCMAG, PCMag, 25 Feb. 2021, www.pcmag.com/news/what-is-5g.

⁸⁴ Segan, Sascha. “What Is 5G?” PCMAG, PCMag, 25 Feb. 2021, www.pcmag.com/news/what-is-5g.

⁸⁵ Johnson, Keith, and Elias Groll . “The Improbable Rise of Huawei.” Foreign Policy, 3 Apr. 2019, foreignpolicy.com/2019/04/03/the-improbable-rise-of-huawei-5g-global-network-china/.

⁸⁶ Segan, Sascha. “What Is 5G?” PCMAG, PCMag, 25 Feb. 2021, www.pcmag.com/news/what-is-5g.

that confusion.”⁸⁷ As mentioned above, AT&T is the biggest culprit of misleading its customers with commercials and even signals on devices showing that their phones are on 5G when in big cities such as Atlanta. However, “5GE is just a rebranding of AT&T’s Gb 4G LTE network. AT&T argues that the speeds are close enough to 5G, but it is technically not 5G.” ⁸⁸ The G stands for generation, typically signaling a compatibility break with former hardware. 5GE does not follow this trend and is technically not 5G. This marketing strategy may mislead individuals who do not know 5GE is not actually 5G.

It is important to note that while many 5G networks do not have the full capabilities and will not have full capabilities, a study was conducted to find the 5G speeds that companies have and their effectiveness in cities. “ootMetrics” praised T-Mobile/Sprint for having the largest 5G footprint and best availability across the country, however Verizon did have the fastest overall speeds, even though these speeds were in such small areas. This finding is shown in Figure 7. Meanwhile, Opensignal declares TMobile/Sprint to have the best 5G network at the moment thanks to top download and upload speeds. Verizon has the better video experience over 5G. ⁸⁹Another study done by Ookla, which relies on crowd-sourced testing, gives the crown to AT&T for fastest 5G network as of the end of 2020, after Verizon’s average speed tumbled thanks to the introduction of slower nationwide coverage.⁹⁰

II. Qualcomm

⁸⁷ Staff, Tom’s Guide. “When Is 5G Coming to You? The Definitive Guide to the 5G Network Rollout.” Tom’s Guide, Tom’s Guide, 4 Feb. 2021, www.tomsguide.com/special-report/when-is-5g-coming-to-you-the-definitive-guide-to-the-5g-network-rollout.

⁸⁸ Gillis, Alexander S., and Kate Gerwig. “What Is 5G? Everything You Need to Know About 5G Technology.” SearchNetworking, TechTarget, 8 Jan. 2020, searchnetworking.techtarget.com/definition/5G.

⁸⁹ Staff, Tom’s Guide. “When Is 5G Coming to You? The Definitive Guide to the 5G Network Rollout.” Tom’s Guide, Tom’s Guide, 4 Feb. 2021, www.tomsguide.com/special-report/when-is-5g-coming-to-you-the-definitive-guide-to-the-5g-network-rollout.

⁹⁰ Staff, Tom’s Guide. “When Is 5G Coming to You? The Definitive Guide to the 5G Network Rollout.” Tom’s Guide, Tom’s Guide, 4 Feb. 2021, www.tomsguide.com/special-report/when-is-5g-coming-to-you-the-definitive-guide-to-the-5g-network-rollout.

Before providing information on Qualcomm, it is important to note that they are different than the telecom companies listed above such as Verizon, AT&T, Sprint, and TMobile. While these companies are cellular servers, Qualcomm focus on the research and development of network technology.

Here is an easy way to look at it: generational networks are composed of different layers. The first layer is the foundational layer. In this layer, network technology is created. The next layer is where hardware is built, and the third layer is full of sectors such as smartphones where companies give cell-phone access to customers.⁹¹ Qualcomm competes on the foundational layer. “There are different players on this network side including Huawei, who also competes in other sectors as well, like smartphones. “The top 10 companies cover roughly 80 – 90 percent of this sector.” ⁹² Qualcomm is number one and Huawei is a close second place.” ⁹³ There are also more competitors including Ericsson, Nokia and a few hundred others worldwide. Based on the network technology standard, hardware is built such as chipsets, handsets like smartphones and tablets, and base stations. These are the three separate hardware pillars which sit on top of the foundation. In the third layer, carrier services ride on top of these hardware pillars. These are what AT&T Mobility, Verizon Wireless, T-Mobile and Sprint sell to the marketplace in the United States. ⁹⁴ Moreover, all of these layers build upon each other to create the last section which is what people commonly refer to as, 5G - “The finished product which

⁹¹ Kagan, Jeff. “Kagan: Why Qualcomm Is Important to USA in 5G Race.” RCR Wireless News, 9 Dec. 2019, www.rcrwireless.com/20191209/analyst-angle/kagan-qualcomm-5g-race.

⁹² Kagan, Jeff. “Kagan: Why Qualcomm Is Important to USA in 5G Race.” RCR Wireless News, 9 Dec. 2019, www.rcrwireless.com/20191209/analyst-angle/kagan-qualcomm-5g-race.

⁹³ Kagan, Jeff. “Kagan: Why Qualcomm Is Important to USA in 5G Race.” RCR Wireless News, 9 Dec. 2019, www.rcrwireless.com/20191209/analyst-angle/kagan-qualcomm-5g-race.

⁹⁴ Kagan, Jeff. “Kagan: Why Qualcomm Is Important to USA in 5G Race.” RCR Wireless News, 9 Dec. 2019, www.rcrwireless.com/20191209/analyst-angle/kagan-qualcomm-5g-race.

is a combination of three different levels. So, as you can see, there are many slices to this pie.”⁹⁵

It is important to mention this because it is upon this foundational layer that the race for 5G implementation, and subsequently global technological dominance is being fought on. While US commercials can mislead individuals to think their networks matter most, it is the foundational technology and equipment that will decide who wins the race for 5G. This is why Qualcomm is the most important company for the United States in their race against China for 5G implementation. Realistically, it is the United States’ only domestic company that can compete with Huawei to create and implement 5G technology around the world.

Qualcomm thrives in the world of technological advancement, information rights, and most importantly patents. While Huawei has the most 5G patents in the world, Qualcomm actually has what is referred to as the most 5G core, important patents. China realized the value of patents early in 5G development, which is why Huawei has been making claims for patents regarding 5G technology and networks. Research shows that Huawei’s patents, while vast, are more focused on quantity than quality. One article says, “if you were to do a patent comparison between Huawei and Qualcomm, you shouldn’t just count patents but also assess the strength and value of those patents. Huawei may have more, but Qualcomm, by nature of its business, should have better handset patents due to the company’s tighter focus.”⁹⁶

⁹⁵ Kagan, Jeff. “Kagan: Why Qualcomm Is Important to USA in 5G Race.” RCR Wireless News, 9 Dec. 2019, www.rcrwireless.com/20191209/analyst-angle/kagan-qualcomm-5g-race.

⁹⁶ Enderle, Rob. “Qualcomm vs. Huawei: Is This a Battle Between Companies or Countries?” Itbusinessedge, IT Business Edge , 9 Mar. 2019, www.itbusinessedge.com/blogs/unfiltered-opinion/qualcomm-vs.-huawei-is-this-a-battle-between-companies-orcountries.html.

The difference in these patents is best explained as the difference between protecting your own product versus protecting a product that has to be implemented in all 5G networks. One study on patents says, “Qualcomm licenses and makes a considerable amount of income from those licenses, which forces a different kind of rigor when it comes to patent creation than Huawei, where the patents are mostly defensive or protective to assure Huawei isn’t adversely damaged by patent litigation or doesn’t lose an edge due to a competitor stealing its IP. While Huawei is bigger than Qualcomm, it is contained within its own product set, while Qualcomm’s technology extends across the entire vendor ecosystem worldwide.” ⁹⁷ What this means in relation to future of the world of 5G is that Qualcomm has the ability to drive industry advancements like 5G better than their Chinese competitors can. For example, Qualcomm was the first to launch a commercial 5G chipset while Huawei could have the first 5G phone on the market. Qualcomm has done the initial investment on the ground level more than other companies, giving it the greatest assets for 5G advancements.

Not all patents are created equal. Some are based on past technology. Some are simply not as important as other patents. “Therefore, if the company with less patents creates a better industry with better products and better user experience, then they are obviously the industry leader, no matter how many patents they hold. The reverse can also be true for companies with the most patents If a patent is not core to the network, and is even outdated, it is quite often peripheral.” ⁹⁸ In other words, it’s good for the number count, but not important as a leadership builder. Yet, that’s not the way it’s

⁹⁷ Enderle, Rob. “Qualcomm vs. Huawei: Is This a Battle Between Companies or Countries?”* Itbusinessedge,* IT Business Edge , 9 Mar. 2019, www.itbusinessedge.com/blogs/unfiltered-opinion/qualcomm-vs.-huawei-is-this-a-battle-between-companies-orcountries.html.

⁹⁸ Kagan, Jeff. “Kagan: Why Qualcomm Is Important to USA in 5G Race.” RCR Wireless News, 9 Dec. 2019, www.rcrwireless.com/20191209/analyst-angle/kagan-qualcomm-5g-race.

positioned in the marketplace with marketing and public relations. “That’s why it’s important to understand the quality of a patent than the mere quantity of patents a company holds.⁹⁹

Because of these advancements and ownership of core patents, Qualcomm has been identified “as a national treasure by the U.S. administration.”¹⁰⁰ Due to their importance to 5G development, the US has protected Qualcomm from moves that could hurt it such as “an Apple-orchestrated hostile takeover of the company by Broadcom last year.” ¹⁰¹ The reason that U.S. leadership is backing Qualcomm is due to the U.S. wanting to be a part of, if not leading, the development of 5G and its global standards.¹⁰² Qualcomm research and development states that, “Just a few companies shoulder the burden of research and development for the entire world because of the high-risk investment and tremendous engineering expertise required. Among them, only Qualcomm is an American company. The ground-breaking inventions and ideas of these R&D innovators are vetted via a consensus-based process to ensure 5G standards reflect the best technologies available. The process is highly collaborative, yet also highly competitive. That is because whoever leads in defining the 5G technical standards has the greatest control over future products and infrastructure.”¹⁰³ Qualcomm is important to the future of American technology because of its technological advancements as well as its

⁹⁹ Kagan, Jeff. “Kagan: Why Qualcomm Is Important to USA in 5G Race.” RCR Wireless News, 9 Dec. 2019, www.rcrwireless.com/20191209/analyst-angle/kagan-qualcomm-5g-race.

¹⁰⁰ Enderle, Rob. “Qualcomm vs. Huawei: Is This a Battle Between Companies or Countries?” Itbusinessedge, IT Business Edge , 9 Mar. 2019, www.itbusinessedge.com/blogs/unfiltered-opinion/qualcomm-vs.-huawei-is-this-a-battle-between-companies-orcountries.html.

¹⁰¹ Enderle, Rob. “Qualcomm vs. Huawei: Is This a Battle Between Companies or Countries?” Itbusinessedge, IT Business Edge , 9 Mar. 2019, www.itbusinessedge.com/blogs/unfiltered-opinion/qualcomm-vs.-huawei-is-this-a-battle-between-companies-orcountries.html.

¹⁰² Qualcomm. “The Race to 5G: Setting the Pace for What’s Next.” CSRWire, Qualcomm, 19 Dec. 2020, www.csrwire.com/press_releases/709566-race-5g-setting-pace-whats-next.

¹⁰³ Qualcomm. “The Race to 5G: Setting the Pace for What’s Next.” CSRWire, Qualcomm, 19 Dec. 2020, www.csrwire.com/press_releases/709566-race-5g-setting-pace-whats-next.

leadership in the US technology industry. The Department of Defense and Department of Energy both agree with this, and they support Qualcomm and its R&D “claiming national security is at risk with Huawei being one of the main competitors of 5G technology.”¹⁰⁴

¹⁰⁴ Enderle, Rob. “Qualcomm vs. Huawei: Is This a Battle Between Companies or Countries?” Itbusinessedge, IT Business Edge , 9 Mar. 2019, www.itbusinessedge.com/blogs/unfiltered-opinion/qualcomm-vs.-huawei-is-this-a-battle-between-companies-orcountries.html