Singtel’s 5G Strategy Includes an Aggressive Stand-Alone Core Network Deployment

ABI Research’s IoT Market Tracker 5G (MD-IOTM5G-108) forecasts 5G IoT revenue to reach US$1.1 billion by 2025, growing at a Compound Annual Growth Rate (CAGR) of 154% between 2021 to 2026. This opportunity is being pursued by many countries as they roll out 5G networks, starting with Non-Stand-Alone (NSA) 5G, which utilizes the 4G Evolved Packet Core (EPC) to deliver 5G enhanced Mobile Broadband (eMBB), with plans to upgrade NSA networks to Stand-Alone (SA), which will enable the full suite of 5G capabilities—including Ultra Reliable Low Latency (URLLC) and massive Machine Type Communications (mMTC).

However, Singapore Mobile Network Operator (MNO) Singtel, which owns Optus in Australia, is taking a different approach. While Singtel does operate 5G NSA networks with limited coverage, it is opting to directly build and deploy SA networks rather than extensively roll out 5G NSA and eventually upgrade it. The Infocomm Media Development Authority (IMDA) in Singapore has authorized the country’s 3 MNOs (Singtel, M1, and Starhub) to build 2 SA 5G networks by 2025, with the country’s newest MNO (TPG) left out of the equation. Singtel has accelerated 5G SA development, partnering with Ericsson in building the 5G SA network on 3.5 GHz and 28 GHz, as well as rolling out millimeter wave (mmWave) connectivity in hotspots across the country. M1 has also partnered with Nokia to build a 5G SA core with cloud-native software for a 5G SA launch this year.

This approach might signal that Singtel does not necessarily see the benefits of NSA 5G outweighing the costs of deploying the network. Instead, it might see the full suite of 5G being the main value driver justifying the cost. As a result, 5G consumer penetration in Singapore might remain lower than other Asia-Pacific countries such as South Korea, China, Japan, and Australia in these few years while 5G SA is being deployed.  However, this also points to a longer-term 5G play that is much more focused on generating business value through working with enterprise and unlocking innovation. For example, Singtel has trialed its 5G SA network with Ubitus, a cloud gaming company. This makes use of 5G SA’s URLLC capabilities to ensure that there will be low-latency and response times when streaming games from the edge server. Current trials are able to reach 85% lower latency (between 8 and 11 ms) compared to 4G cloud gaming. Streaming games from the edge server to the mobile device would reduce the processing demands on mobile devices and offload it to the cloud, which can reduce lag times and open up new opportunities for competitive mobile e-sports.

With 5G SA, Singapore has made multiple enterprise-centric partnerships across different verticals. In the industrial vertical, 5G SA trials are being conducted for unmanned aircraft systems for incident management and response for port operations, as well as other smart port use cases in partnerships with M1 and Singtel. There have also been Industry 4.0 trials with IBM, M1, and Samsung to leverage IoT and AI for manufacturing use cases. Smart city applications such as Cellular Vehicle-to-Everything (C-V2X) testing are being conducted at local universities for 5G-connected self-driving cars and relaying real-time traffic information to drivers and pedestrians.

While Singapore took the longer-term 5G SA approach, not all operators should take the same approach. Tier One operators like Verizon and Telefonica might have the capital required to reap the gains of an early 5G NSA roll-out, which can boost Average Revenue Per User (ARPU). But smaller operators might want to consider investing in a longer-term SA play, with an eye toward creating new 5G ecosystems and establishing partnerships with enterprise players, which can provide new streams of revenue. Operators must also understand the use cases that either NSA or SA can enable, as well as how to apply these use cases. For example, cloud gaming is a use case which will be fully realized with 5G SA due to URLLC, but 5G NSA can already support the use of Automated Guided Vehicles (AGVSs) for a smart factory.

An NSA-first approach might allow an MNO’s customers to experience eMBB, which is a step up from the current 4G experience. While LTE Advanced Pro can potentially deliver Gigabit throughput speeds in an optimized environment, in reality, 4G typically delivers download speeds of 15 to 60 Mbps. Early rollouts of 5G NSA can deliver 300 to 650 Mbps (as in the case of South Korea), providing more quality video streaming with less buffering and stutters, and can eventually provide an excellent experience for HD and even potentially 4K videos. However, it should be noted that 5G NSA networks rely on a 4G LTE core network, and if the end user moves out of 5G coverage, they are switched to 4G, which might create some delays or drops in latencies. This might have a negative effect for certain use cases which require reliable and predictable latency, such as 5G-powered drones, Cellular-to-Everything (C2X) vehicles, and cloud gaming.

The biggest advantage of SA 5G over NSA 5G is the full suite of 5G features—including network slicing, uRLCC as low as 1 ms in certain cases, and eMBB with download speeds of up to 10 Gbps. This creates new growth opportunities, such as making heavy-duty graphics games completely free of a wired connection and Wi-Fi. This also creates new partnerships and ecosystems. For example, cloud gaming provider Ubitus has partnered with Singtel to deliver cloud gaming using Singtel’s Multi-Access Edge Computing (MEC) platform. Furthermore, the operator can create new business models, such as having a capacity management model that can support the potential scenario of user adoption and usage (i.e., gigabytes of data used per gaming session).