Albanian authorities seem to have given up on a rapid implementation of 5G technology.
Earlier last year, AKEP had predicted that the first frequency bands for this technology would be tendered as early as 2020.
But, this did not happen and this year in its reporting to the Albanian Parliament AKEP no longer sets deadlines for this process. The approach has changed and before the implementation of 5G technology, a study will be done on all issues raised by the new technology, including security issues.
Sources from AKEP inform that at the beginning of this year it has opened the procedures for contracting a foreign consultant, which will prepare a detailed and comprehensive analysis of the aspects of sustainable development within the implementation of the new generation technology in Albania, defining the strategic steps and coming to conclusions for further decision-making at the sectoral level. According to AKEP, the situation and developments of new generation technology in the countries of the region and EU countries, is such that the solutions are diverse and applied depending on the specific conditions of different countries, taking into account technological developments, conditions of the mobile market, the need for maximum state and social benefit.
Completion of this process will require a relatively long time, from the provision of expertise by the consultant, AKEP decision-making about it, consultation of findings and proposals with stakeholders to reach the end of the opening of the competition for the use of frequencies. Given the time required for all of the above stages, the process of implementing 5G technology is unlikely to start this year. Market sources say that this process is likely to start after the middle of next year. The decision to pursue a more prudent approach to 5G technology is related not only to technological and security challenges, but also in part to economic reasons.
Not all operators are enthusiastic about a fast generation of tenders for 5G frequencies. In recent years, market profits have fallen sharply, affecting the investment capacity of operators. Especially the second and third largest operators, welcome a postponement of the process, because they are not yet inclined to pay again for new frequencies, moreover that Albania has not yet fully exploited the potential of 4G technology. The 5G generation is the new technological frontier of mobile communications, which is expected to bring much higher internet speeds than the existing ones. It is estimated that in theory 5G networks can offer maximum internet speeds that exceed the limit of 10 Gbps or 10 times higher compared to the more advanced versions of 4G technology. Although official data claim coverage of 96% of the population with 4G networks, this coverage varies greatly between different operators, and often even in larger urban centers the quality of service leaves much to be desired. Implementing 5G technology could possibly deepen the advantage of operators having greater market power and more opportunities to invest in frequencies and network infrastructure.
BB: For Albania 4G is more convenient for 100% internet coverage
For Albania, 4G technology can be a more efficient solution for full coverage of the population with internet broadband compared to 5G technology. World Bank experts have prepared a study that estimates the costs of universal broadband internet coverage, depending on the technology used. The study concludes that, for countries like Albania, which already have a high population coverage with 4G networks, universal coverage using this technology would be more convenient. Based on AKEP data used in the study, Albania has a population coverage of 4% with 4G network at the level of 96%.
Costs have been calculated over several scenarios, taking into account different technical solutions and different levels of target network speeds. In the optimal scenario, according to which a speed of 400 megabits per second (Mbps) is targeted in high-density urban areas, the WB team estimates that Albania needs an investment of between 250 and 340 million dollars for universal coverage with 4G network. The $ 250 million investment refers to the scenario where the network is built on mobile infrastructure alone, while the costs can reach up to $ 340 million if this network is supported by a fiber optic infrastructure. In the case of 5G technology, universal internet coverage would require an investment of at least $ 320 million for an exclusively mobile infrastructure, but would reach up to $ 710 million if fiber optic support is used.
Investment values are lower in the case of scenarios that predict lower network speeds. But, it must be said that the above optimal scenario is the only one that meets the objectives set by the United Nations Broadband Commission, which sets a speed of at least 10 Mbps in rural areas.
Even for scenarios that predict a lower speed, however, 4G technology is more convenient, even in these scenarios the cost advantage of 4G is much deeper.
However, 5G technology may become advantageous in a scenario where operators would build a shared network infrastructure, rather than each setting up their own network independently. The degree of savings would depend on the level of shared use of infrastructure and investment costs could be reduced by up to 70% if operators were to use fully shared networks in rural areas. Such a solution would significantly reduce investment costs, but, according to experts, could have long-term negative effects on competition. Reducing competitive pressures can create gradual declines in efficiency, causing economic benefits to decline gradually over time. Taking into account some developing and middle-income countries, the study concludes that 5G technology can have economic advantages for universal internet coverage only for those countries where 4G network coverage of the population is low.
The 700 Mhz band is released next year
Another issue related to 5G technology is the release of the main frequency band that will be used for this purpose. The Council of Ministers approved earlier this year the New National Frequency Plan, which stipulates that the 694-790 MHz band will finally pass under the administration of the Electronic and Postal Communications Authority (AKEP) starting June 30, 2022. 700MHz band is currently in use by audiovisual broadcasting operators, who should release the frequencies by the middle of next year. Once the frequencies pass under the administration of AKEP, they will be able to tender for the provision of 5G services by mobile operators. The bandwidth in the 700MHz band is expected to be the most important link to the bandwidth of 5G technology, in terms of spectrum management. Technically, this generation offers network coverage of wider areas, which is the foundation for the concept of Internet of Things (Internet of Things). Based on the Decision of the European Parliament of 17 May 2017, EU member states should allow the use of this band for the provision of broadband mobile electronic communications services.
They may delay the use of the 700MHz frequency band for up to two years based on justified reasons. As a candidate country for membership, Albania has used all the two-year space left in the EP decision, as a deadline for the transition of this generation to the use of electronic communications operators. Optimal coverage with broadband mobile internet networks is important for Albania, also because our country is among the most backward in Europe in coverage with fixed networks. Even for this reason, internet from mobile networks is a necessary alternative for the residents of suburban and rural areas, now that a large part of the services provided by the public and private sector are increasingly moving online.
/ Monitor
