T-Mobile today announced that it will be using its recently acquired 600MHz spectrum to provide 5G service starting in 2019. The comments below may be attributed to Jan Dawson, Chief Analyst, Jackdaw Research. Jan can also be reached for further comment at email@example.com or 408 744 6244.
In marked contrast to most of the other carriers who have announced 5G plans, T-Mobile intends to use low-band spectrum to provide widespread 5G coverage across the US in the near term. Whereas Verizon and AT&T have been testing dramatically faster 5G services based on high-band spectrum, T-Mobile is prioritizing coverage over speed with its approach. That means it won’t get the dramatic generational leap in performance usually associated with a new generation of wireless technology, but it will likely have one of the first widespread 5G networks not only in the US but in the world. There’s a certain irony in T-Mobile taking an approach which could see it lead in coverage but lag in speed over time, given that it has until now been known for the opposite: a fast but far from ubiquitous network.
T-Mobile will get some of the other benefits of 5G, even if it won’t get the speed, however. One of the major benefits of 5G is the ability to have a single network perform in different ways optimized for various classes of devices. That means it can provide both higher-speed service to smartphones while also operating in a very efficient way for Internet of Things devices, which in turn will be able to last for years on a single battery. The 5G network T-Mobile is planning to build therefore opens up potential new opportunities which could help the company continue to grow even as its reliance to date on phone subscribers starts to provide diminishing returns.
For better or worse, T-Mobile’s aggressive approach may largely set expectations in consumers’ minds for what 5G is and how it performs. Its modest ambition is to improve the average experience on its network through a combination of faster LTE and then 5G, rather than provide a radically new and upgraded experience. That may dampen excitement among consumers for 5G at least until the other carriers start to roll out their more geographically limited but more impressive networks. It may also cause confusion about what 5G really is, because it will mean fundamentally different things depending on which carrier offers it.
Lastly, T-Mobile’s focus on broad geographic coverage means that nothing in its early 5G strategy will help with its big strategic weakness: its lack of a play in home broadband and TV services. Given the rise of bundles and the increasing convergence between home and mobile services, there’s going to be increasing pressure for T-Mobile to pair up with a provider that can offer those services. Other carriers are pursuing 5G in a form which could replace home broadband services where deployed, but T-Mobile won’t be going down that route at least in the beginning, which means it will likely still need a merger with a cable or landline telecoms provider somewhere down the line to be competitive in bundled services.