5G Moves Much Faster Than the Aviation Industry
(Bloomberg Opinion) -- Amid all the hype about flying taxis and digitally souped-up jets, a simple truth about the aviation industry can get lost: Change happens glacially. This is for a good reason; airplanes that ferry hundreds of people don’t make the best laboratories, and the worst-case scenarios from technology gone awry tend to be much more dire than those facing most other industries. But this deliberate approach can feel sloth-like compared with modern innovations. Case in point: Almost 15 years after Apple Inc. released the first iPhone, Honeywell International Inc. is only just now introducing cockpit controls with a smartphone-like user interface. The Federal Aviation Administration’s insistence that AT&T Inc. and Verizon Communications Inc. temporarily delay the launch of 5G technology should be viewed in this light.
The aviation regulator, the Department of Transportation and the wireless operators reached a tentative truce this week in what had become an increasingly tense standoff over concerns about possible interference with equipment used to land planes in bad weather. Amid threats of legal action, AT&T and Verizon reversed their position and agreed late Monday to delay launching service on a new band of spectrum for two weeks. The wireless operators also agreed to put in place additional safeguards around 50 priority airports for six months.
That should give the FAA more time to evaluate the risk of disruption to radar altimeters — which use radio waves at frequencies similar (but not too similar) to the new 5G signals to measure planes’ distance to the ground — and avoid issuing blanket flight restrictions for now. The Airlines for America trade group has estimated curbs on low-visibility landings could delay, divert or cancel 350,000 passenger and freight flights a year in the worst-case scenario. The FAA and the Transportation Department agreed not to ask AT&T and Verizon for any further delays barring “any unforeseen aviation safety issues.”
A casual observer might wonder why there’s so much fuss over a two-week holdup. AT&T and Verizon’s frustration is understandable. The carriers had already agreed to a one-month delay that pushed the launch of 5G from December to January. More important, the Federal Communications Commission — the agency responsible for governing the use of U.S. spectrum — decided it was safe to open up the new frequencies to wireless services nearly two years ago. That conclusion included a review of aviation-related risks, although industry groups have said their concerns weren’t fully addressed, and they continued to raise issues. AT&T, Verizon and other wireless operators paid more than $80 billion to buy rights to the spectrum in an auction completed last January and paid billions more to accelerate the transition from the satellite companies that had been using the frequencies. “Inexplicably, the FAA and the aviation industry apparently did nothing” to prepare and adapt altimeters for the rollout during the intervening period, AT&T Chief Executive Officer John Stankey and his Verizon counterpart, Hans Vestberg, wrote in a Jan. 2 joint letter.
The mismatch seems at least in part to reflect a misunderstanding of how the two industries operate. Aviation “moves incredibly slowly with standards and putting new equipment on planes, and that’s understandable because they’re focused on safety, but it’s not compatible with the speed at which the tech sector moves and the speed of deployment of 5G,” Tim Farrar, a telecommunications and satellite industry consultant, said in a phone interview. Aviation regulators have a tendency to look at the “worst case of the worst case” and “that’s not a reasonable position to take,” he said, pointing out that about 40 other countries have already successfully rolled out 5G service at similar frequencies with minimal disruptions to air travel. It’s worth noting that U.S. aviation regulators have received much scrutiny lately for not thinking carefully enough about the worst case of the worst case when it came to Boeing Co.’s 737 Max, whose twin crashes led to a nearly two-year grounding. Not for nothing, the past two years in the aviation industry have also been dominated by the devastating effects of the pandemic.
Aircraft radar altimeters are meant to operate at frequencies between 4.2 and 4.4 gigahertz, which should create a buffer of at least 400 megahertz from the levels that Verizon and AT&T will be using for 5G service in 2022, the wireless companies say. The problem is that some older altimeters may lack the latest in transmission filters and pick up energy over a larger band. Most large commercial jetliners are likely fine, particularly given airlines’ accelerated retirement of older gas guzzlers during Covid, but swaths of more mature regional aircraft, business jets and helicopters may require upgrades, Farrar said. He pegs the cost of these retrofits at a few hundred million dollars — a not insignificant amount of money but marginal compared with what the wireless operators paid for access to the new band of spectrum. “The real question is just how quickly that can happen,” he said. In comments to the FCC, aviation experts have said it could take years to develop new standards and replace equipment, as Bloomberg News has reported.
Representatives of AT&T and Verizon had accused the airline industry of holding their 5G rollout hostage in an attempt to get the wireless operators to pay for the upgrades, but the agreement with the Transportation Department makes no mention of financial compensation from any source. The terms of that arrangement suggest the two sides are reaching the end of this dispute, although further setbacks can’t be ruled out, said wireless industry consultant Chetan Sharma.
“No one wants to come out on the wrong side of, ‘Hey, we warned you’ and then something bad happens,” he said in a phone interview. But “if the science and engineering is backing it and no one in the signal processing or chip manufacturing or wireless industry is saying this is a problem, then someone has to play the judge.”
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Brooke Sutherland is a Bloomberg Opinion columnist covering deals and industrial companies. She previously wrote an M&A column for Bloomberg News.
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