Network regulation and the implications of 5G and wireless substitution. Non-standalone 5G accelerates fixed to wireless substitution: will Regulators rethink markets?

Verizon's recent announcement of the deployment of a non-standalone 5G wireless access network is confirmation that 5G makes wireless a real substitute for fibre, and not just at the margins. It will have major implications for how competition and telecommunication regulators around the world view mergers between carriers and allegation of abuse of dominance by fixed line operators. In short, the traditional advantages enjoyed by incumbents in terms of a fixed line network are being further eroded by 5G and faster than many expected. This should make it easier for fixed line operators to merge but it also challenges the viability of fibre network rollouts, particular in areas which can be served by wireless more cheaply. We will watching this space very carefully!

Making visionary technologies like IoT or driverless cars work in practice will require the deployment of advanced, broadband and highly-resilient mobile networks. 5G is the mobile standard under development for this objective. The German national regulatory authority has already taken first steps towards making available spectrum for 5G in the 3.6 GHz band and will likely tender it in an auction in 2018.