By Claus Hetting, Wi-Fi NOW CEO & Chairman
A bizarre bend on the meandering 5G spectrum saga transpired last week as the FCC voted unanimously to move forward with the allocation of 1.2 GHz more Wi-Fi (unlicensed) spectrum in the 6 GHz band. It is now quite possible and even likely that the US will more than double the amount of spectrum available to Wi-Fi by end 2019 or perhaps early 2020. So how will this impact Wi-Fi and the world? Here’s our take.
A couple of weeks ago a study by the Wi-Fi Alliance concluded that the global economic surplus value of Wi-Fi is nearly $2 trillion US dollars. In the US alone, the value is about half a trillion dollars. Wi-Fi as a technology carries about 70-75% of smartphone traffic in the US and much more in countries like Japan and Germany where new data shows that the proportion is well above 80%.
Thank you, 5G proponents
Despite such heaps of compelling evidence that Wi-Fi is not only the workhorse of the Internet but frankly inseparable from its very existence, the FCC’s decision – and even the Indian governments recent 5 GHz decision also – seems to be based predominantly on something else: That the world will need more Wi-Fi to offload onto or else 5G won’t have enough free capacity to lean on.
In other words: An industry worth trillions of dollars in market value (4G mobile) will need a lowly industry that is at most worth a few handfuls of billions of dollars in market value (Wi-Fi) in order to (possibly) succeed in making more trillions with 5G. Yes, it is indeed ironic. But hey, whatever the reason happens to be: We’ll take the 1.2 GHz, thank you very much.
Wi-Fi: Consolidation – and opportunity
The truth is that this 6 GHz spectrum boost will launch the Wi-Fi industry into a new growth trajectory. It will boost Wi-Fi wherever there is Wi-Fi today. It will cement and solidify Wi-Fi’s massive indoor dominance. And surely – with the help of emboldened entrepreneurs everywhere – it will bring low-cost Wi-Fi (and unlicensed) connectivity to places where it has never been before.
The new spectrum means that the economic surplus value of Wi-Fi (in the US) will indeed double to reach $1 trillion by 2023 – as the Wi-Fi Alliance’s study predicts. The urgent need for Wi-Fi spectrum – as outlined in another study here – will be fulfilled at least for the US. Pretty much everything we’ve asked for, we’ve been given. Thank you, 5G proponents.
More Wi-Fi coming to a place near you (everywhere)
There is also nothing stopping Wi-Fi from growing to 90-95% smartphone traffic share in 2023 – which will be our (wildly unscientific) prediction for now. Why you ask? Because people in the US perhaps spend 90-95% of their time indoors. Because new multi-channel Wi-Fi – which within the foreseeable future will include both Wi-Fi 6 and 6 GHz – will be blazingly fast and much, much faster than 4G or 5G. In other words: There’s more Wi-Fi coming – a lot more – to a place near you.
And then there’s all the prospective new stuff about which we can only theorise and imagine. What is certain is that 1.2 GHz more is a huge boost to the case for – for example – smart city or municipal Wi-Fi and that the price-to-performance ratio of Wi-Fi will continue to outperform anything else.
Yes, there are still some pieces of the Wi-Fi technology puzzle missing for it to be a true, mass-market wireless proposition on par with cellular – but perhaps this new spectrum injection will give everyone an incentive to get this fixed once and for all. We recommend getting going on that immediately. Alternatively – or perhaps in parallel – the wireless world will soon be ripe for solving the convergence (‘offload’, if you like) problem on the device side by – for example – TCP multipath.
Add to this the prospect of using the new 6 GHz band for (non-Wi-Fi) FWA-type access – which is today one of most important wireless growth segments. Add to this that the range of a Wi-Fi 6 access point could be as much as four times the range of current (Wi-Fi 5) technology – opening up for city-wide coverage with IoT services, for example.
Add to this that the new 6 GHz band will be virgin Wi-Fi territory – making it more attractive for large-scale private (enterprise) wireless networks for industry, governments, production plants, what have you. Remember also that all of this will be served by Wi-Fi 6, which has been designed for high-density use. So we can comfortably add to the list the most obvious case: Sports and entertainment.
So how about the world?
More often than not when the US has taken the lead in Wi-Fi spectrum allocation the world has followed to the extent that this is possible. For the EU we know that about half of the US 6 GHz band could be made available in reasonably short order. Certainly the rest of the world now has a strong incentive to follow the US lead and benefit from economies of scale.
Finally: One thing that has always rung true about the Wi-Fi industry is this: There has always been fast-paced innovation. We have no doubt that this will naturally accelerate when the prize – more relevance, more traffic, more use value, more users – is now so much bigger.
The band may ‘only’ have doubled but the future value of Wi-Fi has as of the FCC’s decision this week without a doubt multiplied. So welcome, world, to a new wireless paradigm – a paradigm of the two new sixes – namely Wi-Fi 6 and 6 GHz. This new paradigm will live, breathe, and prosper very nicely, thanks – with or without 5G at its side.
Update 25. December 2018: Since this blog was published the FCC has released the NPRM (proposed rules) document for 6 GHz unlicensed. You can find all the details here.