By the end of 2021, Latin America seems to be heading towards 5G with the processes faced in Chile, the Dominican Republic and Brazil, although in different stages. A few days ago, in a regional congress Guillermo Solomon, Chief Digital Transformation Officer LATAM at Huawei, said that the region should not let more time pass because the fifth generation of mobile will make a difference in terms of development and productivity, and developed countries are advancing without pause. He is convinced that 5G is an opportunity for Latin America, because it will force us to work on basic issues that start from connectivity but that go directly to two fundamental pillars, education and health. The executive delved into the value of this technology and contextualized it within the framework of the digital transformation that is going through the whole world.
He addressed each of the issues and did not miss any of those raised by TeleSemana, from changes and regulatory requirements in terms of connectivity and frequency allocation processes to the possibilities that open up with private business networks, while continuing to side Huawei’s position on Open RAN and the way to generate new business from 5G.
Why does 5G make a difference?
All that are technologies of Artificial Intelligence (AI), big data, robotics, Internet of Things (IoT, for its acronym in English) and the cloud have existed for decades but could not reach the maximum potential because there was no bandwidth enough. You couldn’t have high-speed wireless services. And then there was the issue of latency. The analogy of 5G with the human body is valid: if I bring my hand to the fire and withdraw it because I am burning, that takes 10 milliseconds. 5G brings up to a millisecond. As the bandwidth and latency are now down to the same level as that of human beings in terms of motor skills, which responds at the same speed, the controls respond to us at the same time. And that allows to have applications that could not be done before and that catapult the main industries, especially the BtoB, not the BtoC.
What are those top industries?
All industries, vertical or horizontal. 5G is what allows all these technologies to reach their full potential, but the driver for growth will be AI in the next two decades. 5G makes it possible to connect millions of things. And everything can be connected. Logistics works very well, the same for airports with luggage. The sensors allow us to know in what place and condition a package is. Some carry the temperature and pH of the product. When all this is connected and can be sent online, the AI processes the information and begins to give the human operators suggestions, but the machines will continue to learn and we will allow them to make decisions before we make them. Medicine, transportation, smart cities, energy are going to be important. 5G and the digital transformation that is taking place will affect the growth of cities. Instead of being vertical, they will become smaller because the taboo that we can have virtual work was broken. People will be able to live in more remote places and the dynamics of economies, cities, where digitization rises and rises making new applications will change. Other sectors such as transport, retail, banking, health and education are the ones that are looming more important, but it will also affect tourism, the legal profession, all areas where robotics can replace the repetitive tasks of human beings.
How do you see the evolution of 5G in Latin America?
Connecting the unconnected is extremely important and is a fundamental part of digital transformation because connectivity entails equality. It is not enough to carry the antenna. In rural areas you have to connect schools and clinics, not people. Education must be brought to the city level and health to the city level. And that’s where the digital transformation begins. Education is for children and adults, where an agronomist from Buenos Aires can give tips to rural workers on what to do with a certain planting because thanks to the low latency it is possible to have good communication. For the rural part it is very important to do it and do it now. You do not have to ask the operators for hedging obligations to cover the casitas. In rural areas this requirement cannot be made because the houses are scattered. Chile, Colombia, parts of Peru, Argentina are mountainous. You have to ask them to connect and then put a free Wi-Fi so that users can upload, see things on the Internet, whatever they want, but first education and health. So on that side it is very important. Then, to continue with the digital transformation it is very important to create talent and the problem is not in the universities because we have to recreate the talent that is in the companies; They must be trained to use the new tools easily so that they remain productive people.
Are operators prepared to provide these new services, and in this context, what about private business networks?
Collaboration and ecosystems are the most important in this era and in the digital transformation. No operator or company can be a know-it-all, before yes. Now it is the other way around, what you are looking for is the business, and then you have to partner with each of the market players. Operators have to adopt the ecosystem to their advantage and quickly have partners in this way. There was a case in Mexico of a pig farm that needed service. The operator could not do it alone, so it was necessary to bring in an integrator who uses the platform, develops the algorithms, puts the sensors, and thus the weight, the temperature are calculated, with the cameras, with AI and 5G, and 70,000 can be monitored animals all day, all the time. We are going to do tests in Mexico and Colombia and we hope that in Argentina as well. And it will be done with the same technology as in China. This leads to operators working in full collaboration. Operators have to embrace the ecosystem, order it in their favor, and quickly have business partners do it this way.
In other words, operators are obliged to rely on other new players who until now did not take them too much into account.
Right, it is very important that the operator already works collaboratively. If they want to provide a service to a mining company, for example, they will have to have their ecosystem of external collaborators who are experts in integrating systems for mining companies, those who make robots, those who make cranes, those who handle explosives. because that is never going to be handled by the operator. But it does have a relatively small pool of expert mining partners to run that business.
What about corporate private networks?
There they have a lot to do with regulation because what is done in Europe is that they are already granting spectrum concessions limited to a small area so that a factory can have its own spectrum, can set up its network and operate it. In my opinion, I don’t think it is the correct way to collaborate. If I build cars, why do I have to set up a 5G network? Has no sense. Getting into a business that is not mine is not going to work. Operators can set up these networks, or set them up ourselves and manage them through the operator, because they operate alone. And with the concession of the operator’s spectrum, because if not, the government concessions spectrum in a certain area, in an industrial park, and it is difficult to establish the limit, what happens with what is around. Anyway, I think that there will be feasibility to do those things because 80 percent of 5G is going to be in buildings, because the frequency that is being used is that of the 3.5 band and it is so high that it is very bad for penetrate buildings, and you would have to penetrate with great power. Then networks will have to be deployed inside the building. There you have 3G, 4G, 5G and WiFi 6 technology and you can put up to four operators. To give an example: the government or the owner of the shopping center may be the one who pays for the network to get to that particular place faster. The government can give the go-ahead to that network and oblige by law that all operators have to connect so that when a user from any of them arrives, they have service within that 5G shopping center. I think that’s how they are going to start. I cannot tell you exactly how it works because it is being developed, but it is another option that I see as very plausible, because then the operators, happy with life, will not be the ones who will always have to put up the money. And the network was had in the time when the mall needed it.
You mentioned that we are in the era of collaboration, what is Huawei’s position regarding Open as an alternative to move more quickly towards 5G?
If the market goes to Open RAN we will be in Open RAN. Everything has advantages and disadvantages. It would form competitors to current suppliers, and smaller suppliers would be created. The problem with this is that the technology requires a lot of investment in research and development. If Huawei invests 14 percent in R&D in technology that it sells, what happens to these companies that do not have that possibility. The money is not going to be there in terms of technology development. We go where the market goes, we are a customer center and whatever the client wants, we will give it to them. But where the money is invested in ID is where the future is. Huawei leads the telecommunications networks in the world, it is the one that sells the most. Google, Microsoft, invest a lot of money in R&D and obviously we are the ones who are creating new things and the destiny of technology in the world. O-RAN is to lower the cost, but it is a problem not to investigate. Then 6G, 7G will come, in rural areas there will be no problem in using these equipment, but it will be much more competitive.
What are we going to see from these decisions made in China in relation to 5G, and focus on a handful of industries?
They are all economies of scale. China has economies of scale everywhere. He did tests in all fields. The most successful are the ones that are being prioritized. It is not that surgeries are abandoned, as in the case of telemedicine, but it goes into the background for the moment to implement what they see as most relevant for the Chinese market that is not guided only by the government, but has a tendency Social. That it is business but that it positively affects the user. That is why they are choosing things like that. And they see the world as another market. And Huawei will be giving priority to that, agriculture is one of the sectors. The UN wants by 2030 to eradicate hunger and that can only be done with technology. One of the things that Huawei does for China and the world is to focus very strongly on agriculture and livestock, but also other areas such as mining.
And how do you see the countries of the region on their way to 5G?
Depends on the country. There are more focused governments and others that ignore them and it has been clearly seen in the progress in different countries. Chile and Uruguay have been spearheads in these technological feats, they have it in mind in political and economic strategy. Other governments have praised, such as Colombia, that it has taken giant steps in regulation but not so much in reality, and we hope that this work will continue. Brazil can think differently and leave things in the middle, but it is on a wonderful path. They have already deployed 5G networks, and there is already a commitment from operators by 2022 for serious deployments and commercial service. Depending on where you go you see different things. Hopefully there is something like the European economic community that determines where things should go. In Latin America consensus is more difficult for us, but there are countries that set the example such as Brazil, the Dominican Republic and Brazil, and Uruguay is at the forefront.
And business cases?
I don’t see things cooked yet. I am very convinced that implementations will begin to occur in these vertical markets, especially in agriculture, medicine, education. But we are a little late, and that is why I insist that there is no more time to lose.