Welcome to episode 166 of the G2 on 5G. It's the latest insight scoop on everything in 5G. We cover six topics in about 20 minutes, and it's brought to you by More Insights and Strategy. I'm Will Townsend, and joining me again this week is fellow analyst Anshul Sag from Dallas, Texas, after attending the 5G Americas Analyst Summit.

So it's good to see you, buddy. 

This is you too. I was trying to grab something here to demonstrate where I'm at, but I'll just compensate and say there's something behind me that says some 

stuff. All right, man. Everything's bigger in Texas. So sorry, I missed you. I was actually, I'm going to speak about Huawei.

They had a mobile broadband forum in Dubai and I ended up not attending that. I was originally invited, but we'll get into that in a minute. But I want to talk about my first topic, and it's about Ericsson, and they recently announced a massive write down of Vonage, and so it got me thinking, does it signal trouble for its plan to accelerate 5G developer innovation?

And so the company spent over 6 billion on Vonage. And what it was hoping to leverage and what it still is leveraging is what Vonage provides from an API perspective. And the goal is to integrate Vonage into Ericsson's networking infrastructure to basically make its network. Deployments more programmable, it's still a solid foundation.

1 of the reasons why there was the right down is that kind of companies that are in the same sort of market space as Vonage have seen their values decline and, Erickson points to, there are a lot of different factors going on with inflation and that sort of thing. And from my perspective on the surface, this is more of a balance sheet treatment, thank you. Ericsson is still very bullish on developing what it's calling its global network platform GMP and that they don't believe that, this impairment alters any sort of outlook on what they're doing there. It is interesting. This was 1 of those acquisitions. That was massive.

When you look at just the overall amount of money spent. And it also got you thinking Vonage, it wasn't clear to a lot of people initially the value that Vonage could bring to Ericsson, just given its traditional VoIP, market focus, but I tend to agree. I, I think, this is probably more of a balance sheet write down and.

Time will tell. There have been some, analysts, peers of mine that have been critical that, there's only, I think, 1 or 2 MOUs that Ericsson assigned to advance this forward. But at the end of the day, the real innovation with 5G is going to come from the developer community.

So I applaud what they're doing to to expose network functions and basically enable developer innovation. So I don't know if you caught the news, but any thoughts? 

Yeah I do think, I saw the news. I do think that they probably overpaid for it. 

That's definitely.

Yeah, so 

I don't think the acquisition is bad. I do think that the price was a mistake. And I think that's a, this is a clear indication of them making that adjustment. 50 percent is a pretty big price to pay. for overpaying. So I definitely think that some people might, have to bear responsibility for that because that's three, three billion dollars.

But I heard there were some shakeups in Erickson's executive team. So maybe somebody did actually end up having to pay for that. But yeah, I think it's just somebody has to own that they made a mistake and, not make those mistakes again. 

Yeah, I agree. I don't think the management shuffles are due to this in particular.

There's also some change occurring within its cradle point division as well. There are a few senior level leaders, including its CEO that are stepping down and they've named some new replacements. Yes, and corporate America, you and I have been there. I, I did the corporate America gig for 30 years and typically, you shake up management when things are going exactly to plan.

But, it'll be interesting to see how this plays out. It's good for the industry. It's great for innovation and I applaud Erickson for doing it. Full steam ahead, hopefully for them. Let's go to your first topic. And I did catch this just the other day. And this is probably in response.

I'd like to think in response to our coverage of of satellite communications on this podcast, but SpaceX, announced that they're going to take their Starlink platform and they're going to go direct to sell for smartphone users. And, this isn't a surprise, they made an announcement with T Mobile last year.

There weren't a lot of details there, but I'm going to let you take it and fill in our viewers and listeners. 

Yeah, so this was an announcement that actually came through today. It's breaking news in a sense. It happened, I think, earlier today. Yeah. But basically, they announced that they're going to be calling this service Starlink Direct to Sell.

And what's interesting is, they don't actually mention 5G. They say it's a seamless access to text, voice, and data for LTE phones around the globe. I think this is obviously a play to push into as many devices as possible. So there isn't a, a bridge between 4G and 5G. What's interesting is that...

They will come to service with texting first in 2024, and then they'll do voice and data in 2025, and they'll also do IoT in 2025. Other interesting updates or details are that There will be no need for hardware, firmware or special apps to run the service which is different from a lot of other satellite services.

And then they also will be working with multiple carriers around the world. And they said that there will be cellular providers using direct to cell will have access to reciprocal global access. in all partner nations. So T Mobile, Optus, which is in Australia, Rogers, which is in Canada, One, New Zealand and New Zealand, KDDI and Salt.

So you have six carriers that are currently partnered around the globe and they have reciprocal coverage with each other. So I think what happened with this business model is. If you're a customer of these carriers, you'll probably be able to access this service for free and have reciprocal access to other carriers.

But then if you want to access this service, and you are a customer on any of these networks, then you have to pay for whatever the service is. That's how I think it will work. There aren't any details yet. I haven't had a chance to speak to T Mobile. Or Optus, but I have a feeling that's how it will work.

But it's exciting to see another company started to actually talk about how they're going to come to market. 

Yeah. And I read the news as well. And they highlight the fact that there are specific dedicated satellites to do this, right? So let's not forget that Starlink has been very focused on its.

It's service it's monetizing the service with fairly expensive, consumer premise equipment devices and they continue to roll out. They have a lighter weight version. I think that's designed for RVs and, camping and that sort of thing. It is interesting that they're now officially providing more details around direct to sell.

Something that we've been talking about for quite some time with with a s t space mobile and its relationship with at t. What I find interesting is that a s t Space Mobile, in addition to at t they've signed MOUs with 40 other mobile network operators in around the world. So initially the depth and breadth of what they are doing is greater than that of starlink.

Hey, what's interesting. I think we've talked about this as well. AST space mobile relies on star Lake rockets to get their satellites in the air. So it's very interesting to see all this come together. I agree with you. It's good for connectivity. Competition breeds innovation.

That's one of my famous expressions that I like to cite all the time. So I think this is a good thing. And it's I think, acknowledges a lot of what we've been discussing around. I think the most disruptive opportunity will be direct to cell phone without any sort of needed modification and that sort of thing, but we will definitely keep tabs on this.

And I'm sure we'll be talking about this further on future podcasts, but let me go to my 2nd topic this week. And I did allude to this. So while we held its mobile broadband forum in Dubai, I was invited to participate. I had some last minute conflicts and I have another trip as I head out tomorrow, Friday.

Okay. For Riga for 5G techratory. And our viewers and listeners, you'll be seeing live tweets from me and Riga Latvia next week. But while they spoke to a number of different things, but they also addressed 5G red cap. And that's something that, I've talked about on prior podcast red cap stands for reduced capacity, and it's designed to leverage a lot of the benefits of 5G from.

But through putting the latency perspective, but support lower power devices, lower power hotspots. Wearables and all of this, and so at the mobile broadband forum, which I believe was a joint event between Huawei and GSMA, they spoke to the fact that they are working with a number of different operators on a global basis.

10 carriers from 7 countries have been piloting red cap and Huawei expects that connections will exceed 100M within the next 3 years and that. They alluded to 50 devices that will potentially become available by the end of this year. And Wally, man they're like the energizer value.

That just doesn't want to die. So they've, they've been, they've had all sorts of roadblocks with entity listings and that sort of thing, but they continue to move forward. They continue to push forward with 5G this mobile broadband. Forum in Dubai is an example of that. And it's interesting and I don't disagree that red cap brings some pretty interesting capabilities to bear leveraging sort of a lighter version of 5g new radio.

I don't know if you caught this news, but in general, what are your thoughts and, in particular about, the capability and potential of red cap. 

Yeah. So I did catch this news and I thought it was really interesting because. I feel like they're leading the industry in terms of talking about red caps.

I believe that, maybe technologically they're not any more advanced than other companies are, but it really feels like they're really messaging this heavily and honestly, I think they're right to be doing so. I think you and I both agree. Red cap is a big opportunity. I just think that in my mind, if I'm looking at 5G modems, there's no way I'm putting a 5G modem in a watch.

Unless it's red cap. There's also learn how to put 5G modem in any wearable unless it's red cap. Obviously red cap is very dependent on standalone. It literally does not work without it, but I think that red cap is a really good demonstration of what happens when you're only on 5G. And when you're only on standalone, when you're able to take advantage of all the peak capabilities that 5G has promised us for so long.

I'm here at 5G Americas, I'm talking about my opinions on things and the disappointment around 5G was a very common topic during the conversations that we had here. I'm like, guys, I know exactly how you feel. I wrote a paper about it to, I went into depth about why we're, why, where we are.

And it's a lack of standalone. That's really the core of it. So I'm not trying to be funny, but I just think you're right. This is a really good thing from Huawei. And to your point, they are the energizer bunny and they just refuse to go away. And I think they're going to just continue to push into the markets where they don't have, restrictions.

Yeah, and your point about, this, the standalone versus non standalone is vital. And I think, GSMA or 3GPP in particular, we'll look back at this and determine, hey, was it was a good thing or not so good thing. And I think what it did is it really slowed the overall deployment.

And, we've talked about this as well, standalone unlocks the true promise of 5G. Thank you. I will also add that which is very interesting, red cap also supports network slicing. So if you think about smart wearables and latency and throughput and the ability to steer and tailor those attributes to certain devices, it's quite compelling.

And then just the low power, capability. It's a red cap as well. And, power efficiency is 1 of the improvements in 5G over LTE, but it still draws a ton of power. Yeah, it's interesting. It's exciting. And, hey, kudos to Wally to keep the momentum rolling there.

We have seen announcements from carriers like around red cap. So I think you're going to see more deployment against it. But with that, we're going to go to your second topic. It is also Huawei and you want to talk about some benchmarking against it's the Mate 60, right? With the Kirin 9000 chipset.

Honestly, I just realized about 10 seconds ago that we both have our second 

topics as well. That was not by design, by the way, 

I thought that was funny, but it does to the state of where Huawei is today, in terms of their visibility in the market. But basically, this is the Kirin 9000 chip from high silicon, which is a, the silicon division of.

Of Huawei and Hot Hardware got their hands on a Mate 60 with this chip in it. And they ran it through its paces in terms of benchmarks for, system benchmarks, graphics, CPU. And in almost every test, it was at the bottom of the barrel, like bottom. It wasn't like, I can go and look at the article.

I closed it earlier, but basically if you look at GPU bottom of the barrel like PC Mark bottom of the barrel Antutu bottom of the barrel, 3D Mark bottom of the barrel this thing was losing to old, older generation Snapdragons and Samsung chips. It's worse than the Pixel 6 Pro, so two generations old Pixel chips.

Yeah. It's just not a very performing chipset in any way. And in some benchmarks like 3DMark, which is graphics related, it's slower than a Galaxy S21. We're on 23 now. So it's it's very far behind where it should be. And that might be a combination of, process node. Maybe it's not really a 7 nanometer chip.

Maybe it's more of a 14 nanometer chip is what we've been hearing. And that would actually make more sense because a 14 nanometer chip would probably be falling into that performance profile because now, flagship phones are like 34 nanometers, right? So that's a pretty big performance profile that you lose by being on a much higher process node because you can't pack as many.

Transistors in just a small space and you lose some of those power efficiencies as well. So this is a clear indication of what happens when you don't have the leading process nodes and you try to build the most advanced chip you can, but I, this is an interesting tale of what happens when you don't have access to the modern, most recent process technologies.

Yeah, and I'm glad you pointed out the power challenge, because, if you're on, an older generation fab process, you're not going to get the same power efficiencies, right? You're not packing as much onto a die. And so that's huge. That's going to affect, performance and.

This is really interesting, because I remember when we launched the Karen chipset, this was several years ago, and it was, it was kicking us and taking names. And this was obviously pre entity listing, and they were leading the charge with integrating, machine learning and AI in their silicon.

Being able to, to sense, user, kind of activity, client email client base versus browser base and then optimizing the performance and the battery life to that user profile. It's really interesting because, I can't and Karen is, when it first launched, it was, it was right up there with, Qualcomm snap dragon and other solutions.

It'll be interesting to see how things happen. There are lots of rumors around China's investment in semiconductor production. There's no secret that we're doing that in the US, right? We're reshoring a lot of that and we're. Intel is investing in a huge fab in Ohio and Samsung, a huge fab in Taylor outside of Austin.

And yeah, and it's, high silicon to your point. That's been Wally's design house but they've never produced it. They've relied on other fabricators to do that. So it'll be interesting, and that's a high bar to to manufacture semiconductors. You got to have equipment.

A lot of that is I think we've talked about in the past that is U. S. equipment from, from the likes of, companies that are basically not allowed to sell their products to law way. So interesting. But let's go to my 3rd and final topic. And I want to talk about British telecom and.

They're launching a new drone SIM that's designed for 5G ultra responsive connectivity. And so I don't really think about the SIM, as a factor in some of these sort of next generation 5G use cases, but basically the SIM is going to use ease network and it's designed to function at high altitudes.

Be resistant to extreme temperatures and humidity and support drone applications in any season. And it's interesting. I don't know how you tweak a sun to do this, but this mobile world live news article also speaks to the fact that. They're aiming to enable high priority and ultra responsive connectivity for improved video streaming and such and then.

Actually goes a step further and talks about some of the applications, which are involving things like delivery of medical supply, search and rescue operations and infrastructure inspection as potential deployments. And the latter is something that I think has been a very prominent dominant use case import operations and that sort of thing.

I think it's interesting, drone 5G drone applications are a sexy use case. Just like the whole notion of using 5G for autonomy. But what do you think? 

I think there's definitely some opportunities with drones. I think that there's going to be. More and more use of drones and a lot of commercial applications, not necessarily as much consumer, especially when it comes to five G.

But I think this is gonna be a good infrastructure play for a lot of companies, and I think Bt is doing what Verizon did and grabbing the opportunity by the horns and trying to make sure that they have a place in that market when it becomes necessary. Maybe just offer it as a service to companies that want to deploy 

that kind of thing.

Yeah, I think on a prior podcast, I talked about Nokia doing just that with drones. Yeah, it's it's quite interesting. As an operator they're controlling the provisioning of devices and that sort of thing. And apparently this is available to BT group. Enterprise customers today.

So quite interesting, but let's move to your, actually, we're going to give you three and a half final topics because there's some late breaking news with with call con, but you first want to talk about T Mobile and dish. And there tends to be some continued contention. That's a lot of C's, but yes, so I want to talk about that.

Yeah, 

it's a, it's like a combination of multiple things. You have the 800 megahertz. Sale that T Mobile is supposedly doing for DISH. DISH has passed their deadline and is asking for an extension. And T Mobile says it's going to cost them an additional 200 million per year to have that spectrum sit and not be used for DISH to be able to pay for it.

But that is the background for this latest SPAT. And this is a SPAT where DISH says T Mobile should not be able to acquire 600 MHz spectrum from Charter, sorry, not Charter, from Comcast. So they want to stop T Mobile from getting this, saying that they will have, un unregulated spectrum or unregulated control of the spectrum and that they have too much appetite for spectrum and that they might not be able to work with other companies.

If T Mobile has so much of the spectrum, interestingly enough, Dish is the second biggest holder of 

600 megahertz spectrum. The irony of it all, dude, is crazy. They're, Charlie's been sitting on so much, and like now they're, it's like quid pro quo. So yeah, 

so it's interesting because this was.

an auction that already happened and Comcast bought a bunch, T Mobile bought it from them because they don't think that they need it anymore. And it's really interesting because at the same time we're seeing the whole FCC bringing up the potential that there might be spectrum filters. So we'll see what happens with this, but I really think that DISH wouldn't be complaining about this if T Mobile had sold them the 800 megahertz spectrum or agreed to the extension.

So I think these are intertwined with each other, but the reality is I think 600 megahertz spectrum is more valuable than 800 megahertz spectrum is, because you're still getting 100 megahertz, but 600 is going to propagate a lot better than 800. But I just think that DISH is in a weird position because they want the spectrum, but they don't want to pay for it right now.

I think maybe a compromise would be that T Mobile lets them pay for it over time or in chunks. Because that's what they're doing with Comcast, actually. They're not paying for it all up front. So I don't know how I feel about this, but, Dish is the one who put themselves in this situation, not being able to afford the Spectrum.

And they waited until the last minute. To ask for an extension when the deadline had passed. But the, it looks like the DOJ is on Dish's side. We'll see if they actually get the judgment in their favor for the extension. 

But this is this relationship between T Mobile and Dish just keeps getting uglier and uglier.

It's like a telenovela or whatever. So yeah. And then the other 

story, which is fairly short, not very sweet, is that there's Qualcomm announced layoff of about 1200 workers, which is about 2. 5 percent of their workforce. They'll be laying people off in San Diego and Santa Clara. Where they have people in San Jose.

It says about a thousand in San Diego and 200 in Santa Clara. And they said the job cuts will take effect December 13th. But yeah this is definitely like a a response to the continued softness of the smartphone market. And honestly, I think it's cyclical. I think things will come back eventually.

It's really dependent. I think this is heavily dependent on China's lack of a rebound. And, Qualcomm is going to be taking charges to this for 2023 and 2024. And the stock has pretty much been flat on this news. So I don't really know, what the goals are here. The statement that Qualcomm sent to CNBC.

For this story says given the continued uncertainty in the macro macroeconomic and demand environment, we expect to take additional restructuring actions to enable continued investment in key growth and diversification opportunities. While we are in the process of developing our plans, we currently expect these actions to consist largely of workforce, workforce reductions, and in connection with any such actions, we would expect to incur significant additional restructuring charges.

They're not cutting R& D spend, they're just cutting workforces. And it seems like it's going to be a lot of people in marketing and PR and analyst relations, people we deal with. It is an unfortunate thing. I don't personally agree with it, but I'm not the CFO trying to keep investors happy.

It is, and they're not the only ones cutting, lots of companies have cut over the last No, 

they are. When you look across both enterprise and service provider Jennifer. They trim their workforce. You're seeing similar trimming, with other infrastructure providers as well and mobile network operators.

And it's it's cyclical from my perspective, and it's unfortunately, it's been a, it's been a trend with, with in particular with big tech and, even with, some companies that are, strong financially, like Qualcomm and Dell Technologies and others, they're still taking the opportunity to do this, and, that statement that you read reads, sounds like a State Department response to something. Ambiguous. And it's just, it's unfortunately a normal course of doing business in corporate America.

But I don't think this impacts anything from a material perspective. But, to any of our friends at Qualcomm, that are affected by that, thank you. We we feel where you're at. I've been there in my career in corporate America have been caught up interrupts and it's just unfortunately nature of the beast there.

But, hey, my friend, I'm glad we could get this 1 in since you've been in Dallas to flying back to California. I'm heading to Europe. We're going to try to get another 1 in for our viewers and listeners next week but no guarantees just given sort of travel. Yeah, I'll be in, 

I'll be in North Carolina next week.

So we'll see. 

We'll see. Fingers crossed. But why don't you take us home? 

Absolutely. We hope our viewers and listeners found this week's topics interesting. If anyone out there would like to provide insights on a specific 5G topic for a future podcast, please reach out to us on social media. Will is at Willtown Tech and I'm at On Shaw Saw.

We hope you have a great week and please tune in next week. Don't forget to rate and subscribe.