In an era where connectivity plays an increasingly vital role in our lives, the advent of fifth-generation wireless technology, more commonly known as 5G, has sparked a global revolution.
As we find ourselves at the forefront of the digital age, 5G technology promises to reshape the way we communicate, innovate, and interact with the world around us.
With unprecedented speeds, incredibly low latency, and the ability to connect billions of devices simultaneously, 5G is set to redefine our understanding of what is possible in the realm of wireless communication.
The global 5G Services Market size is expected to grow progressively over the anticipated frame, recording a CAGR of 25.3% during 2022 to 2027. The 5G services industry spending value will increase from USD 107 billion in 2022 to reach USD 331.1 billion by the end of 2027 (Markets and Markets, 2023).
5G technology is not only revolutionizing the way we communicate and access information on our smartphones; it is also poised to redefine the capabilities and potential of data centers.
Data Centers Leveraging 5G Technology
With 5G’s unparalleled speed, ultra-low latency, and exceptional bandwidth, 5G is set to unlock a new era of innovation and efficiency, transforming data centers into highly responsive, agile, and interconnected ecosystems.
According to Andreuw Thaf, Chief Executive Officer of NeutraDC, “when discussing 5G, the focus primarily revolves around latency, which refers to the delay or lag experienced when transmitting data over a network. The advent of 5G technology has prompted data centers to anticipate and adapt to its potential impact,”
Thaf said, previously, some data centers were situated away from major markets, likely due to various factors such as cost, space availability, or infrastructure considerations. However, with the emergence of 5G, data centers are now relocating closer to the market they serve.
“Now coming closer because of the latency and I believe whatever application now in the market definitely needs lower latency,” said Thaf.
The reason for this shift according to him is the need to minimize latency. 5G offers significantly reduced latency compared to previous generations of wireless networks. This low-latency characteristic is highly desirable for various applications and services that rely on real-time or near-real-time data transmission.
By moving data centers closer to the market, they can effectively reduce the latency between the data center and end users or devices. This proximity allows for faster and more responsive communication, as data can travel shorter distances and encounter fewer network hops. Consequently, the overall user experience improves, and applications that depend on low latency can function optimally.
As a result, Thaf said that the growth of data centers is expected to be exponential due to the increasing demand for low-latency services, with 5G acting as a significant catalyst for this expansion.
4G Networks Remain Significant
When analyzing the recent advancements in 5G technology and its impact on data centers, Thaf said that it is important to consider that while 5G is evolving, 4G networks still play a significant role in data transmission.
While 5G offers improved capabilities in terms of speed, latency, and capacity, a substantial amount of data is still being handled by 4G networks.
The adoption and deployment of 5G networks are gradually increasing, but it takes time for the infrastructure to be widely available and for devices to support 5G connectivity. In the meantime, 4G networks continue to serve as the primary means of data transfer for a vast number of users and applications.
“Even with the 4G Networks, the amount of data is really growing exponentially especially with the post-covid situation.” said Thaf.
Even with 4G networks, the amount of data being generated and consumed is growing exponentially. The COVID-19 pandemic has further accelerated the digital transformation and increased the reliance on online services, remote work, e-commerce, streaming, telemedicine, and other data-intensive activities. The post-pandemic situation has led to a surge in data consumption and the need for robust data center infrastructure to support these growing demands.
5G Adoption in Southeast Asia
In Southeast Asia, 5G has a wealth of potential for operators. In fact, 5G could add 6 to 9 percent to consumer revenues and 18 to 22 percent to enterprise revenues by 2025. Indonesia is expected to capture the biggest share, followed by Malaysia, Singapore, and Thailand (Dobberstein et al, 2021).
Moreover, it is expected that most major service providers would have launched commercial 5G services by the end of 2028. 5G subscriptions in the region are anticipated to reach around 620 million by end-2028, meaning 5G will become the leading technology in terms of subscriptions, with a penetration rate of 48% (Raj, 2022).
However, the region faces a variety of challenges to roll out and capture the maximum value from 5G. Foremost among these challenges will be the slow availability of spectrum for 5G services and the resulting suboptimal network rollout.
Challenges for Full Connectivity
In Indonesia, although the country’s digital economy is continuously growing, there are some challenges in the country for full connectivity or 5G latency. There are still people unable to access the Internet on a mobile device and even fewer people have access to fixed broadband internet.
Nearly 80 percent of those not connected reside in non-metro rural areas of Sumatera, Java and Bali islands, which are the country’s three most populous islands (Setiawan et al., 2022).
On top of that, 60 to 70 percent of Indonesians living in the country’s eastern region are inadequately connected due to variable quality of service.
According to Thaf, “5G technology addresses higher purposes and offers low latency. While proximity is important, 5G deployment can cover both urban and rural areas through a mix of frequency bands. However, the suitability of 5G in rural areas depends on the intended applications.“
Higher Purpose and Low Latency
5G technology is designed to address higher purposes beyond traditional mobile communication. These purposes include supporting emerging technologies like the Internet of Things (IoT), autonomous vehicles, augmented reality (AR), and virtual reality (VR). Additionally, 5G offers low latency, enabling real-time communication and responsiveness, which is crucial for various applications.
Proximity and Rural Suitability
Being in close proximity is necessary for 5G connectivity. Although certain aspects of 5G, particularly the use of higher frequency bands, have shorter range limitations, it is important to note that 5G deployment includes a mix of frequency bands.
With this according to Thaf, this allows for a balance between coverage and capacity, making it possible to provide 5G services in both urban and rural areas. The suitability of 5G for rural areas depends on the specific applications intended to be implemented.
Application-specific Considerations
Thaf said, the suitability of 5G in rural areas depends on the types of applications being implemented. Different industries and sectors have distinct requirements, and 5G can bring benefits to areas such as agriculture, healthcare, education, and logistics.
“Nowadays, what we can see is that the 5g application is not running more towards the public. But it’s hybrid now so it’s a mix between enterprise use cases and public use cases in the places that the public can afford because it is a bit expensive to have 5G.” said Thaf.
Hybrid Application Focus
Thaf also mentioned that the current focus of 5G applications is a hybrid model, encompassing both enterprise and public use cases. Enterprises and industries with specialized needs, capabilities, and financial resources may be at the forefront of adopting and implementing 5G technology.
Cost Considerations
The cost of 5G can be a limiting factor according to Thaf, particularly for widespread public adoption. Implementing 5G infrastructure requires significant investments, and the associated costs of devices, data plans, and services may pose challenges for individuals, including those in rural areas.
“If you ask me, if 5G will be suitable for rural areas. That is a big question mark. Depends on what kind of application that you want to implement. Nowadays, what we can see is that the 5g application is not running more towards the public because it’s a bit expensive.” said Thaf.
According to Thaf, the suitability of 5G for rural areas is uncertain and depends on multiple factors such as specific applications, infrastructure availability, and cost considerations. Assessing the unique needs of rural areas and identifying viable business cases is crucial.
While the current focus of 5G applications may not be primarily on the public, ongoing advancements and initiatives are expected to address these challenges and make 5G more accessible and affordable in the future.
