Should CPAs embrace 5G?

By J. Carlton Collins, CPA

Q. I'm in the market for a new smartphone. Should I be shopping for a 4G or a 5G smartphone?

A. Fifth generation (5G) wireless communication technology beats 4G in at least three key areas — speed, bandwidth, and efficiency. Let's take a brief look at each.

Speed: 5G is much faster than 4G. The table below summarizes the theoretical mobile data speeds since 1991. When reading this analysis, please note that the ultimate speed that 4G and 5G technologies deliver depends upon many factors. For example, while 4G can theoretically provide speeds reaching 15 Mbps to 20 Mbps, many providers throttle the speed back to deliver only 10 Mbps or less. As another example, Verizon says on its website that it will deliver speeds ranging from 300 Mbps to 940 Mbps via its introductory 5G plan.

wifi-speeds


Because the data table above doesn't properly illustrate the difference in speed, I've plotted the maximum theoretical mobile data speeds since 1991 on the chart below to illustrate how much faster 5G could be. Notice in the chart that speeds for the older 2G, 3G, and 4G technologies barely show up, while 5G's speed operates at least 66 times faster than 4G and has the potential to operate as much as 667 times faster.

wifi

Source: Verizon.

Bandwidth: 5G supports more devices. Reportedly, 5G technology can support up to a million devices per square kilometer, compared to only 100,000 devices per square kilometer for 4G technology. This is especially important as everyday devices such as refrigerators, doorbells, and thermostats go online, because it is calculated that 4G technology is unable to manage the anticipated load from these types of internet-enabled devices. Eventually, 5G is expected to support more advanced applications, such as driverless cars, medical devices, and robots.

Efficiency: 5G is more efficient than 4G. Because 5G utilizes shorter wavelengths in the radio spectrum (more on that in the next paragraph), it can transmit data more efficiently compared to 4G. This is because the shorter 5G wave bands can accommodate about three times more data per channel than 4G can. In addition, 5G reportedly requires less energy than does an equivalent size network based on 4G technology.

How 5G outperforms 4G. 5G differs from 4G in that it utilizes the following shorter millimeter wavelengths (or wave bands) of the electromagnetic radio frequency spectrum: 26 GHz, 28 GHz, 38 GHz, and 60 GHz (4G mainly uses the longer 700 MHz, 850 MHz, 1700 MHz, 1900 MHz, and 2100 MHz wavelengths, as well as the 2.5 GHz wavelength). Theoretically, 5G's shorter wavelengths are capable of transmitting data up to 20 gigabits per second, which makes them much faster than 4G. That speed does come with a caveat. The shorter wave bands don't transmit as well through walls or over longer distances, which means that more 5G antennas, transmitters, repeaters, and extenders are needed to create a 5G network.

5G also outperforms 4G because of improved MIMO (multiple input, multiple output) technology, which transmits data simultaneously over multiple channels. To visualize this, picture 256 tractor-trailers driving single file on a crowded straight road to a location. Then picture those same 18-wheelers driving side-by-side on 256 less crowded parallel roads to the same location. In that scenario, you can see that the side-by-side trucks would deliver the payload faster. MIMO accomplishes a similar feat by transmitting data over multiple wavelengths. In comparison, 4G's MIMO technology primarily uses up to four channels to transmit data compared to 5G's MIMO maximum of 256 channels.

Issues with 5G. A lingering issue with 5G technology is whether the use of these frequencies might cause health risks as a result of increased radiation. Many studies indicate that 5G technology is safe, but other studies aren't conclusive. As previously mentioned, while 5G technology is faster, it has more trouble penetrating walls and doors, and its range is limited to about 1,000 feet, so more infrastructure is needed to create a 5G network. Some reports estimate that a proper 5G network will require a mini cell tower approximately every two to eight houses, which will increase radio frequency radiation exposure. While this may sound startling, most people already have a transmitter in their homes in the form of Wi-Fi routers that emit radio waves at lower frequencies. (I should point out that most homes already have many devices that emit radio signals at various frequencies — such as baby monitors, Bluetooth devices, cellphones, smart meters installed by the power company, security cameras, and cordless phones.)

Major wireless communication carriers are moving forward with providing 5G service. For example, as of September 2019, AT&T said on its website that it offered 5G in 21 cities: Los Angeles; San Diego; San Francisco; San José, Calif.; Jacksonville, Fla.; Orlando, Fla.; Atlanta; Indianapolis; Louisville, Ky.; New Orleans; Charlotte, N.C.; Raleigh, N.C.; Las Vegas; New York; Oklahoma City; Nashville, Tenn.; Austin, Texas; Dallas; Houston; San Antonio; and Waco, Texas. Verizon claimed in September 2019 to have rolled out its 5G network in 12 cities: Los Angeles; Sacramento, Calif.; Phoenix; Denver; Houston; Minneapolis; St. Paul; Chicago; Indianapolis; Detroit; Providence, R.I.; and Washington, D.C. So we can see that 5G is well on its way to being deployed throughout the United States.

5G phones. In most cases, carriers offer 5G service for no additional monthly costs (compared to 4G service); however, you will need to purchase (or lease) a 5G-capable phone to take advantage of 5G technology. In September 2019, the Verizon website offered two smartphones that offered 4G and 5G support options; in each case the 5G option was priced significantly higher. Specifically, the 4G version of the Samsung Galaxy Note10+ was priced at $1,099.99, while the 5G version of the same phone was priced 18% higher at $1,299.99. Additionally, the 4G version of the Samsung Galaxy S10 was priced at $899.99, while the 5G version of the same phone was priced 44% higher at $1,299.99. (As of September, Verizon did not offer any other 5G-capable smartphones. Further, as of September, Apple did not offer a 5G-capable smartphone, although rumors are that one will be introduced in 2020.)

CONCLUSION

5G is headed our way. In my opinion, the improved speeds and bandwidth make it worth the additional cost, but the health issues related to all our wireless communications continue to be worrisome. I will be upgrading to a 5G smartphone soon, but I'm not sure I have enough information to make the same recommendation to you at this time — you'll have to decide for yourself if 5G makes sense for you.


About the author

J. Carlton Collins, CPA, (carlton@asaresearch.com) is a technology consultant, a conference presenter, and a JofA contributing editor.

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