 today. Let me open by saying, ladies and gentlemen, the bad news is you will have to throw out your phones in another few months, but at least this time it will be a real upgrade. That's what this panel is about, ushering in a new mobile era, basically the 5G era. And as you can see, we have some of the most important stakeholders of the industry, of this technology on the stage. So without further ado, let me just briefly introduce everybody, and then they will have time to make a more detailed introduction. First, lady first. Sihan Baocheng is the head of Greater China for GSMA, Hong Kong SAR China. She's from Hong Kong China. And Mr. Ken Hu on my left is the deputy chairman and rotating chairman of Huawei Technologies. No further introduction needed, probably. Mr. Jean-Marc Frangos is the chief innovation officer of BT from the United Kingdom. And Mr. Michael Beck is the head of business strategy from Ericsson, of course, from Sweden. We will open by giving every panelist three minutes to briefly introduce themselves, their businesses, their organizations, and then lay out a couple of main talking points. And then we will start the second and third round questions, during which all of our panelists will be welcome to interrupt each other and ask questions of each other. As I understand, we do have a couple of minor debates already in this panel. So please, lady first, Ms. Chen. Okay, thank you very much. Thank you. And good morning, everyone. My name is Sihan Baocheng, and I'm representing GSMA today to be here. I'm very glad. And before I came, I asked a few questions to our host and what is GSMA and what do we do. And some of you said to me, no, we don't have much idea about it. So I think it's a good thing. Everybody knows about 5G, and not everybody knows about GSMA, which is fine. And GSMA represents the global mobile operators' interests. We're uniting about 750 operators in the globe. And also, we work with the wider ecosystem. We have about 350 companies from the mobile ecosystem to be our associate members. And I'm glad to see everybody sitting, apart from Mr. Wang, and everybody here representing company, our members. What we actually do is to work with the global ecosystem to connect everybody and everyone to a better future. Namely, we bring through 2G, 3G, 4G, and we add the doorstep of developing into 5G and entering a new world. There are a lot of issues and challenges and opportunities ahead of us. So we're very pleased to be able to work with a bunch of very talented people in the world to sort of figure out what 5G and other linked technologies like artificial intelligence to be able to give us a clear roadmap to go and see what's going on in the future with 5G. So that is why I'm here today. Thank you. Thank you very much, Ms. Chen. And then we'll just go by seating order. So Mr. Ken, who, please. Thank you, Fan. This is a great pleasure for me to be here to talk about 5G. I've been working in the digital technology industry for almost 30 years, and I've seen a tremendous change. For example, when we started the first Summer Dollars in Dalian in the year 2007, we didn't have any 4G network, any social media applications like WhatsApp, like WeChat. However, today, what we are talking here, people in different places in the world can easily get access to the video streaming in the mobile device. So this is a big change and thanks to the fast development of the wireless technology. And I'm very happy to talk about the next big thing, which is 5G. So about the industry progress of 5G. Now industry started working on 5G 10 years ago, and we have made tremendous progress. And the first set of standards of 5G was finalized in June of this year, which is a great step forward. And our entire industry from device to the infrastructure equipment has been ready for the 5G deployment. For example, while we are a technology provider, we've been working with our customers around the world for more than 50 pre-commercial 5G networks, including BT. We're actually working with BT in London. So the whole progress of the 5G in the industry is very positive. And then I would like to talk about what we can do with 5G. Because when people talk about 5G, we always talk about automatic cars, the smart manufacturing, connected zones. Yeah, I agree that those are the applications for the next couple of years, particularly with some future release of the 5G standard. But today I would like to talk more about what we can do with 5G in the short term, what we can benefit from 5G immediately. Actually, 5G is the technology which can provide as much faster speed, much lower latency, and much, much more connectivity than our existing 4G technology. So that will help us to build a much better user experience on our existing mobile broadband service. And then that will help us to generate many new services like cloud-based virtual reality applications and high definition 4K or 8K on-go. And those new services will also help us to generate many new business opportunities, not just for operators, but also for other vertical sectors like tourism, education, healthcare, retail and sport. So I'm really excited about the potential of the 5G that 5G can provide us, and I'm really excited about the future of 5G. So I look forward to talking more about that in today's panel discussion. Thank you very much, Mr. Hu. Mr. Frangals, please. Thank you. Yes, so I think we're going to be repeating ourselves a lot on this panel because I think we're all very much on the page of this new generation of technology which is 5G. I'm part of BT, BT has the BT brand and the EE, everything everywhere brand in the UK. So we are already a, I would say a leader and we're used to providing very high performance and good quality service to our customers. That's what our brand stands for in the UK, certainly on the 4G technology which is prevalent today. So we're really looking forward to enhancing that experience even more with 5G and certainly we'll discuss certainly a little bit more what that means. My role in the company, I'm actually not based in London, I'm based in Silicon Valley and I'm in charge of detecting innovations for the company and driving them through for the benefit of our customers. And in fact what I was doing before I arrived here in China, I was stopping by in Japan in Korea and consulted with our peers, other operators about this very question of when and what are they going to be doing with 5G and what are going to be the benefits for their customers. I think that the main thing I'd like to say is that we expect the benefits to be significant for our customers. Three classes of benefits and we've already talked a little bit about it but the speed which is kind of the headline number that everybody remembers is perhaps not the most important one. Clearly this latency point that was made earlier is about the response time of the network and I think we'll come back to that because that is very important. The third bit is actually the reliability of that network for business applications and that will be I think transformational and significant. So we've been committed to launching 5G in the UK. We're looking to be leaders in 5G in the UK for sure. Since 2016 we've already been testing various elements and various aspects of the technology and we're now getting into much more pre-commercial trials in London, in 10 areas in London. Our labs have been contributing to the new radio standards. We've been working with 3GPP and the GSMA defining the standard and we're working of course with Huawei, Ericsson, Nokia and the rest of the infrastructure vendors and equipment vendors to bring this to the market in the best possible time. We've announced that we will be launching 5G in the UK in 2019. So that's very good news I think for our customers for the UK in general for the industry to bring this technology forward as much as we can. One point I will make briefly is that we see 5G as an evolution and even though you jokingly said that people will have to throw away their phones we would like to think of a future where 5G actually seamlessly integrates with 4G. 4G will continue to exist for a period of time but also with other wireless technologies like Wi-Fi and also with fixed broadband. So wherever you are in the home in the office or outside we are building our customer experience so that customers don't have to think of which is the most appropriate network whether it is 5G or 4G or Wi-Fi or fixed broadband. So we're hoping to provide the best connected experience to our customers wherever they are. I'll stop there for now. Thank you very much Mr. Beck. Yes very happy to be here. I think it's a very interesting timing also in relation to almost commercially launching 5G now and for me being in the industry very long time as well since the launch of 2G. We launched 2G in Europe in Germany in 1991 and then I've been leading the 3G efforts for our company but also very much with 4G and now 5G and it's very interesting to see this evolution. So first we managed to connect a much broader range of people with GSM than we had with the very scattered local 1G systems leading up to 4G that is very close to a global system that can fulfill a lot of use cases but not everything. And then finally bringing out 5G that is really a system that we designed from the beginning in the industry to really cater for a much broader variety of needs than just the mobile broadband even if mobile broadband will be a major base of revenues and traffic for a long time. The mobile ecosystem has never been stronger I would say but the major challenge for us right now will be to bring other ecosystems along driven by the industries, the car industry, the manufacturing industry, a lot of industries that has been bringing out their own very strong ecosystems over a long time. So what we did when we started to work with more real systems around 5G let's say 5 years ago was that we started to work and engage with a lot of industrial partners, university partners and so on to see to get their requirements in on the technology very early because we saw that what they needed from technology talking about latency and delay times and you mentioned is going to be very different than the smart phone users that we are used to. So I think we've seen that it will take longer time for some of these industries to change but on the other hand I think the impact of that will actually be bigger than maybe the change for the smart phone industry. And when we have looked at numbers and so on we've seen that there is maybe a 900 if we take a 2026 perspective there is a 900 billion US dollar kind of market for the mobile broadband then we have a side market of that that would be fixed wireless kind of replacing fibers and so on. There we have more certain numbers when it comes to creating the network platform that will really enable for the digitalization of industries and so on. The numbers are of course more varying if the operators can mainly support connectivity maybe it's down to 20 percent of that number. If you can take a higher step and really be part of the applications and the digitalization of all these industries then it's of course bigger numbers. But it's to me I'm very happy to be here a very interesting point of time. I think this is very close to what the forum is driving as the fourth industrial revolution really happening much more than we've seen before. So very happy to be here. Great. Thank you very much Mr. Beck. So into our first round of questions. Please everybody feel free to interrupt and ask each other questions. I think that's what we are here for. What's a lively panel without a little debate. Actually backstage there Mr. who asked me a question. What do you think 5G is the question really struck me because even though the service is going to roll out in many markets in the next five to six months 5G phones you will probably see 5G phones earlier in the next few months. Some Chinese companies are going to roll out their phones hopefully also including Huawei. But what exactly is 5G. It's supposed to be defined by the use cases. We all know 5G is going to bring a lot of benefits for the average consumer but also has huge impacts for industries and sectors such as Internet of Things. I sensed a little bit of debate there already backstage because Huawei and BT for example seem to have slightly different visions for exactly what they're going to do with 5G. What their priority is. Is it a consumer. Is it the business. Driverless cars. AR VR. So why don't we start with that. What's your vision of 5G and what is for your business. What's the priority of your early roll out plans. Mr. who. Yeah that. That's a very important question because before we talk about the application of 5G. The question is you know what 5G is. To simply speaking the 5G means faster speed. Much faster speed. Much lower latency and much more connectivity. The ending of the existing mobile technology. Let me give you some figures. 5G will be 100 times faster than the 4G network. And the 5G will be 50 times responsive more responsive than the 4G. And the 5G can provide much more connectivities. See like this meeting room we're going to have. Yeah we have around two to three hundred audience here and with the 5G technology we're going to provide thousands of connectivities in this meeting room. That means we're going to get everything connected. And this is from the technology perspective. And I think the key concern from the consumer is that what we can do with 5G. For the long term I agree that you know autonomous car smart manufacturing all these things are the you know futuristic application. That's very important. However we should focus more on the short term what we can do with 5G immediately. If I'm just to mention that maybe in the next couple of months we're going to throw out all of our smart phone. Yeah I don't think that's the case. However we will have an upgrade on our device. So as a consumer we will firstly feel that you know what's going to be the change on our device. So when we talk about the 5G we should not miss the device. Not miss the device. What I can share with you is that the roadmap for our industry on the device side on 5G is to launch the smart phone in next year. And at Huawei we're going to launch our first smart phone in the mid of 2019. And yeah it will take the advantage of the 5G network with faster speed lower latency. So let me share with you something in detail. For example in our first smart phone we're going to introduce the foldable screen. This is for the first time to introduce the foldable screen on the smart phone. So let's imagine with the much faster speed 100 times faster than today you're going to enjoy an amazing experience with a big screen on your smart phone with you know high definition really. And lower latency will help you to get much better user experience with the artificial intelligence functionality. Because it will help the smart phone which is working with some on-device artificial intelligence functionality work better with the cloud-based artificial intelligence and that will allow us to generate many new AI applications. And also in terms of the advantage of massive connectivity that means at the error of 5G we're going to be able to get everything connected. That will give us a huge opportunity to develop a different format of device. The sensor to connect to the shoes, the glass. So that's it. There's a limited picture for us to develop the different devices and to generate the different kind of new services. So my point is that we're going to take advantage of the 5G not just for the long term but also for the short term. So the question is that how we're going to speed up the deployment of the 5G and how we can encourage the consumer and the industry, industry company to embrace the new technology and to take advantage of the technology. Great. Thank you, Mr. Hu. So my takeaway is from Huawei's point of view, the most immediate beneficiaries of the 5G technology will be consumers and that's where your early focus will be on. Okay. That's I think where Mr. Frangos may have a slightly different priority. So I certainly won't say that consumers will not benefit from 5G. Certainly our EE brand will be bringing the benefit of 5G to our consumers first in 2019. There's no question about it. I think where we do, where we discussed a little bit the difference of opinions, perhaps I am slightly more impatient with regards to the business use cases. And I think Mr. Hu said that they will come in a second phase. Yes, of course, there will be a second phase. I think the question for the industry is how do we stimulate this phase to arrive sooner rather than later because there is significant value enhancements in the user 5G for smart manufacturing for automotive industry and a number of other use cases. So in terms of what will come first, I think clearly the consumer applications will come first. But one point I'd like to make about 5G is we always think of it as a, you know, the equipment manufacturers in this, in this, on this panel, operators will be bringing it to the market and create the network. But there's a third category of people which are the application developers, of course. And this is where stimulating those, these creative ideas for the application developers is something that's really important for 5G. I mean, today already, we know when we've seen a lot of creativity around 4G, around mobile in general, with social application, commerce applications, all sorts of applications. I think with 5G there will be even more intensity in the creation of video type applications. Not just one way video but two way video. People creating videos, user generating video content, perhaps. There will be a lot more intensity in the VR and augmented reality domains. And these have already started, in fact, both Apple and Android, Google, started stimulating this market already at the end of last year with the announcements of our core and our kit, which are tool sets that application developers can use to create these new AR and VR applications. Today, when you look at these AR VR experiences on 4G, it is still not perfect. And I think 5G will bring very, very lifelike experiences. And then there's another category of applications that will be stimulated by 5G. And they have to do with AI. And really AI today, again, is a bit of a specialist affair. You really need to have data scientists to take advantage of AI. It's not open for everyone to use AI, to use all the power of AI. And I think 5G will stimulate opening up AI in the form of AI tool sets and applications sitting on the cloud available to any application developer. That will make a significant difference because it will be about linking the real world with the virtual world. So I think that I predict 5G will have a significant impact there. We can talk more about that. Great. Thanks very much. That's a really very inspiring picture for the future. For Ms. Chen, as we agreed, why don't you help me be the judge or a reviewer of this round and let the gentleman speak first. And then you help me give a review of what you think the situation looks like. Mr. Beck, first, please. I think it's... There is not going to be a killer application for 5G. I think that's very clear. There will be multiple cases. It's a platform, as I said, for both consumers and new users that we haven't seen before. I think there is, as with all other technologies, it's very often applications that we have never thought of when we designed the technology that will be the big thing later. And I think one, to me, very interesting thing, working very much with industrial cases and so on, was when we had... I think it was Verizon hosting an innovation forum in the US where there was a CEO from one of the gaming companies talking about the impact of 5G for gaming. And it's really revolutionary if you can get the kind of speeds that we're talking about, plus that you can guarantee a latency below, let's say, 10 millisecond. It changes the way you design games because you no longer have to download games on your phone, and you can give all players the same environment. While today, a lot of game manufacturers have to kind of fix the game so it works even for people with bad conditions and so on. So they will completely change the game for them. And of course, AR and VR and those kind of things we talked about. But also, when I look at the global market, I think it will happen differently in different places. Right now we see these things happening first maybe in the US and then we see a lot of actions in Korea, Japan, China, as we talk about here. I think you see a little bit different push in Europe. There is a lot of the industrial push first. If you go to Germany, for example, with what they are trying to do with industry 4.0, which is very much a cluster where we are engaging, not because we know a lot about industrial robots and so on. But we know a lot about things that is very close to their pain point. I think they have been connecting machines with quite expensive purpose built, very often cabled technologies and so on. That we can make a huge impact even if we will never be experts in the part that they are into and so on. So I think it will actually happen in slightly different ways also in different markets based on the same platform, most likely with mobile broadband paying for a fairly big part of the investment, I would still say. Great. So Ms. Chen, basically our gentlemen speakers have laid out the leading voices and views of the industry on what 5G is and what the main use cases are. So what do you think and what's the industry consensus right now? I think the audience probably got it already from their comments on what is 5G and what 5G can bring to us. It is very clear that it is coming and GSME intelligence already focused. We have 1.3 trillion, sorry, 1.3 billion mobile 5G connections by 2025 and in this region where the world largest mobile 5G connections will be APAC region will be 675 million and China alone will be around 400 million 5G connections by 2025. It's happening, but when we talk about 5G, we still need to carefully think from different stakeholders what 5G means to everybody. Okay, we need to make sure the technology is ready, the market is ready and the operators are ready. What does that mean? It means that when we say 5G will change the society, it is not just operators business to roll out a 5G network despite the heavy investment in it. It is not just a network previously, previous generations, you can roll out and people can play on it and 5G has a different character in it which enable the network to be sliced and like tailor made to different industries needs. So which means it is not just operators business, it is the policymaker can have the supportive policy framework ready. It is the vertical industries working closely with operators to understand and bring out the potential of what our guest panellists were saying about the low-lentency high-speed and super fast broadband. So I would represent our industry to call upon people, come down a little bit. It is, yes, it is coming. It is definitely coming. We can't stop it. But in the meantime, let's all work together to think carefully and form more partnerships between operators, between vendors, between our vertical partners. It is happening but we still need to encourage more. And which means after we invest heavily in this 5G network. And I read a report. A figure shows that in 5G era, every customer will consume at least 100 megabits data per month. And at the moment, the high span is about 40. So if you stream on AR or VR or video stream on 8K, it will come for an hour. It will consume about 175. So it's, there are, 5G network will be able to provide all this. But I agree with you, there is not just one killer and it is not just consumers. It's about society and it's about industrial IOT. It's about vertical different industries will be able to work together and bring the potential of 5G to the reality. Great. Thank you very much. My next question is a more sobering aspect of the 5G technology and all the business prospects is the cost. So who's going to pay for it? From what I gather, the costs for 5G related infrastructure is going to be significantly higher than 4G and there still isn't an industry-wide consensus as for how we're going to afford that costs. And also, of course, the costs for operators maintaining the network down the road. And Miss Chan, if you could start with a question, what are the main models these days for shouldering the 5G-related costs? Because consumers are most unlikely to pay for to pay more for 5G than for 4G or for 3G for that matter. Because we simply don't believe for paying more these days for better services. Then we're going to come up with the additional cost. It still seems to be a question that's troubling the industry right now. Yes, you're so right about it. It's a lot of operators paying at the moment. Yes, 5G, we should roll out. If you're late, you probably miss a lot of opportunities. But in the meantime, who's going to pay for it? Where is the business model? I think the first thing come to many people's mind will be the supportive policy frame in terms of spectrum. Set the reasonable reserve price. And some of the government already, I think including China already roll out some policies to reduce the burden on the spending on the 5G spectrum. And also I think what I mentioned previously is you can't just solely rely on the connectivity and consumers to pay for it. It's not going to happen. So which we all mentioned about innovation. We need to think about how to make the most of the partnership with other industry and verticals and help to other industry to understand that 5G network plus AI will change their industry. It's at the moment probably you see evolution but then will soon be transformational. It will transform a lot of industries and eventually from our prediction it's going to be revolutionary. Especially with AI and cloud-based services. So every industry got to really looking to these opportunities. How your industry is going to work with 5G and AI to really make your business a success. Great. Thank you. Mr. Hu, what's your take on that issue? Yes, for any new technology the cost should be a very important consideration including the 5G. Actually in our industry when we started working on 5G 10 years ago we took the cost as a serious consideration from the end to end perspective. For our industry when you talk about the cost of 5G we always talk about the cost of the data, data traffic. And then we can look at the structure of the cost of the 5G. There are some key aspects. First is the cost of the equipment of the infrastructure equipment that's normally for the carers is a capex. Actually with 5G we provided lots of innovation technology which helped the carers to greatly enhance the efficiency of the spectrum and that will help the operators to lower the cost of the data traffic. And another cost is the operation cost. To be honest the 5G technology is much more complicated than any existing mobile technology. So from the technology perspective we introduced some emerging technology like the artificial intelligence to help to supply the operation like the configuration of the network and that will help the operators to greatly reduce the OPEX which is nowadays which is 3 to 4 times of the OPEX. And another part of the end to end cost is actually the cost of spectrum resource and the fiber optic. And here is the area where the regulator and the government can help a lot. So we hope that the government can help to supply more sufficient spectrum resource to the market in a more reasonable mechanism with the lower cost. That will greatly help the industry to lower the end to end cost of the 5G service. And also will welcome more supportive policies to help carriers to deploy more fiber optic on the ground with much lower cost. Because when we talk about the 5G 5G is not just about the air interface. It's not just a wireless technology. 5G is about the end to end architecture. And 5G will carry on huge amount of data. So while the carriers can deploy more fiber optical networks with a lower cost then it will help to better accommodate the fast growing data traffic and help to reduce the overall cost of the 5G. Great. Thank you. Mr. Frangos, you also earlier mentioned the prospect of AI helping reduce costs or raising efficiency. Do you think that is a practical solution in the near future? That's a slightly different side of AI. We were talking earlier about enabling applications via AI tool sets for developers and what we just talked about here is a slightly different way of using AI to reduce the cost of our operations. So yeah, we are realistic about the fact that for every generational investment for telecommunications operators there is always a challenge in finding the equilibrium, right? And there's always a period of time where you're not exactly sure how that equilibrium will be reached. But we are certainly confident it will be possible and we're going in this direction exactly. When it comes to the way, I mean just to add on to the point that was just made, 5G is the first generation of technology that is being deployed with AI supporting it. This was not the case with 4G. 4G was the technology that had IP at the centre of it which helped rationalise some of the backhaul and some of the traffic on the network. But 5G is a very different scenario and I think most of the operators are in the process of transforming the way they work and transforming it from you've probably heard about this software defined networking and network function virtualisation. What that means is that we are using a lot more of the modern IT models to run the functions of our network and we're certainly hoping that we'll get a lot of support as already mentioned from our equipment vendors to make the running of that network more like an automated running of a data centre which has a low cost of operation typically. So there's a lot of lessons to be learned there and a lot of expectations that the operations of a 5G network even though it is inherently more sophisticated will allow us to run it more efficiently and more smoothly. The point about spectral efficiency was already made. So this is our hope as well that per information transported we will have a better equation with 5G. So there's a lot of hope that there are mitigating factors with the support of the industry and the ecosystem around this. Thank you. Mr Beck? So to me the cost comes from many different points and what will happen is that we will have around 8 times more traffic in 2023 that we have to cater for and if you look at everything you can do with 5G which is adding all the spectrum we can and so on then of course the maximum efficiency of a radio site can be maybe up to 10 times higher than an average site today. So there is the cost efficiency if you really look at the extreme traffic cases but I think it also comes back to spectrum as we talked about that is the lifeblood of our industry. Spectrum is where everything is built from and their governments and regulators have a very strong role to make that system a predictable system and again we know what happened in Europe when we had these licenses for 3D and year 2000 that pulled the whole profit from the industry for a couple of years. There was very challenging for the whole industry for some time. I think a lot of technology innovation will also help cost. I think AI is one we are already using automation machine learning and so on and on we have what we call managed services that is running networks for operators for around maybe one billion customers. Then we start to use a lot of these technologies already so it's not only future, it's actually what you can do today. Then I think for the whole digitalization of the systems there is a lot more that can be done in what we call the operation and support systems to automate operations. We will also have cases where not only the operators but also in some cases utilities or building owners or public safety where you have someone operating the network that is less skilled than BT for example that needs a fully automated network even more. So I think there are cases where we need to pull that lever even further. And then of course upgradability so for the first time we designed 5D to be a system that is really built on the coverage that we have from 4G both in terms of access to lower spectrum but also that we can upgrade with software all equipment, all radio equipment that we have delivered since 2015. There is a number of steps we need to take that together. We'll build the cost picture and maybe last but not least it's not only about the box price. It's really some of the major cost for the operator is spectrum. It is access to sites so if we can bring out technology that really utilizes spectrum more efficiently or decreases the number of sites you need to cover a certain area that cost saving is very much higher than the equipment price decrease. So we do a lot of work there as well. I think that's important. Great. Thank you. Events in the last year including for example trade frictions between China and the US and of course this morning we have this latest 200 billion dollars a tariff on another 200 billion dollars worth of Chinese goods to the US and GDPR for example and also security concerns that's arisen in some western countries about Huawei's technology. These all seem to complicate matters for the rollout of 5G services. As major industry players what's your estimates on the impacts of these events and what's your strategy on dealing with them? Mr. Hu please. Yes. Actually Mr. Chen just talked about in order to widely deploy 5G we need to get ready on technology we need to get ready on the market so we need to get ready on the operators. You know the operator and actually I'd like to add one point which is we need to get ready on the awareness of the security of 5G. We've been working with our operators around the world with our customers around the world and we observed that one of the challenges at this stage is the lack of understanding of the security of 5G. From the technology perspective actually 5G is more secure than 4G. Let me give you more detail because at the beginning of the standard development the industry has been working very hard on developing secure architecture for the 5G. So now from the architecture 5G inherits and build on the same architecture secure architecture on the 4G and is even more secure than that. For example the 5G will accommodate huge amount of data. So the security working group in the 3GPP has been collaboratively working with thousands of operators from dozens of companies on designing a layered architecture for the protection of the data transmission. Let me give you an example. In the 4G we use the encryption of 128 bits and in 5G our industry doubled encryption from 1 to 8 to 256. So this is a huge improvement on the protection of the data transmission. So this is just one example of the consideration on the security of 5G. So no matter from the technology or the standard perspective, actually 5G is more secure than 4G. However, it's disappointing that in some of the earlier stage of the technology discussion there is a lack of professional understanding and discussion on the technology itself. So we will encourage that at any time when we talk about 5G we should be ready on the awareness of the 5G security and we should firstly leave the discussion to the people who really understand the technology and to conduct the discussion in a more professional way. Mr. Frangos, apart from the security concerns also reverberations on the supply chain, for example what are all these events going to, how are they going to affect the 5G technology rollout? I would say the running a national infrastructure network in any country is something that is normally taken seriously. And so we have a lot of controls and robust security testing in place. When it comes to supply chain we pay a lot of attention to not just the first level but the second layer of supply chain and how do we make sure that we can mitigate the risks of course for the supply. But in general, GDPR these are not really new risks I mean these are things that have been around for a long time. We've been dealing with our suppliers Huawei, Ericsson, Nokia for a long time and also we have a very good mechanism with the UK National Cyber Security Council to have jointly with them to agree with the processes and make sure that we have no national security risk. So all of that is I would say nearly business as usual but business as usual is taken very very seriously. So Miss Chen from an industry group's point of view how serious are these events and their impacts do you think? Yeah, GSMA is an international organization we don't get into politics. At the beginning I said we would like to promote the healthy and sustainable development for our mobile industry so from that point of view I have to say there are some politics affected our industry's development previously like the ZTE So what GSMA would like to do is still do our job right so on behalf of our operators community if there are events affect the industry's healthy development or sustainable development GSMA would take some points and trying to talk to various stakeholders and trying to solve the situation but it is really hard for a international organization to get into any politics so it is a very hard question to me So it's mostly politics in your view? I think it started from politics but like I said the consequences may impact the health development of our industry for example the ZTE case Thank you, Mr. Beck To me it's also a reflection that telecom is no longer only telecom but it's really part of the world so when globalization goes into more multi-local or especially the big markets applying different policies we have to be very close to these governments and regulators as we have been for a long time and its security is really really important for our systems and will be even more when you start to use for many of the other industries public safety for example wouldn't even touch our equipment if we couldn't guarantee security and we are already today deploying LTE systems for public safety in some of the big markets so I think some of these cases completely rely on that we get people to trust what we do so to me it's super important because privacy and all these data regulations that is coming where we have to be able to show and guarantee where we store data and so on so we have a lot of technologies coming back to the cloud and distributed workloads and so on where we have the possibility to place functionality wherever we want in the network and we have to utilize that very much in conjunction with the regulations on we have a lot of work now with IoT and in some big markets the data has to be handled in certain ways so there is a lot of those requirements that we haven't had in the same way before but I think it's really us being part of the new world that is developing I think we have technology wise the tools to do that in a very good way but we have to be very close to the markets, the regulators the governments Thank you very much we have about seven minutes left we do have plans we have a few questions from the audience so as we agreed earlier with the panelists the way this works well I will take two or three questions from the audience one by one and then we run all of them through the panel for one round anybody can feel free to answer to any of these questions they would like so please Thank you very much panel for an excellent conversation I'm very proud to be the executive of our comms media and technology business I have no doubt that network operators and network equipment OEMs will for sure figure out how to overcome the CAPEX, OPEX, RND and spectrum challenges and deploy 5G the question for me is how will we avoid watching the margin migrate up the stack towards companies that perhaps have deeper insight into customers or deeper relationships so we will remember that and take another question from the audience please I just had one question generally there was a World Health Organization's report which talked about serious health issues including cancer because of high radio frequency and 5G probably can make it five times more than what it is today I don't know whether there is a point for you the audience has got or is any kind of regulatory or otherwise from a company's point of view any work is being done to look at what exactly is the impact including high radiation, cancer and so on alright thank you very much so I think we only have time for these cool questions please feel free to ask questions of our panelists after this we may have a little bit but why don't we take the health impact question first Mr. Ho yeah I can I can generally talk about how we can leverage the capability of 5G in mid-term and long-term on different vertical industry applications and I think that's actually one of the advantages of 5G because when we talk about 4G or 3G we are actually benefiting from the capability that help us to communicate with others and for the 5G the biggest difference is that 5G will help us for our industry to help us to get access and to expand to the application of the vertical industry but we will highly rely on the features that will be provided by the 5G faster speed, lower latency and massive connectivity so I think any of the vertical industries will have the chance to closely work with our industry to figure out how to integrate the capability of 5G network which is which is probably become to have the chance to become a digital infrastructure of the whole society and then to figure out how we can leverage the capability to trigger some innovation in other vertical industries but to be honest currently I have no idea how we are going to leverage the 5G capability on the specific application in the healthcare industry but that will give us a huge opportunity to work together to work together and to figure out what will be the most helpful application in the different vertical industries and that also gives us the implication that the development of the 5G the model of the development of 5G should be different from our existing or past the technology of 3G or 4G because for the 3G or 4G we develop the technology and you use the technology but for the 5G the model should be we work together to define what the technology is what the use case is and then to figure out how to develop the right technology and how to evolve the technology step by step Thank you and our other panelists please for the two questions anything you would like to add Maybe I could comment on the second one then on the margins My view is that as I talked about we have defined the use cases in four groups and especially what I call the mission critical group is the more uncertain to me it depends on the role that the operators are willing to take on where in the lower case based on connectivity as we do today might be maybe 20% of what mobile broadband is as a business and in the high case maybe 50% if they decide to go further in the stack then I think in general for technology going much more the mission critical where you really depend on the network the latencies and so on it's much more difficult to construct everything over the top compared to if it's just best effort so I actually think that many of these cases where the network really plays the crucial role in performance latency, security and so on the value will be higher so to me that will be a strong factor working against what the question was about I was just going to reinforce that point because we haven't talked about the details of how the 5G network will be implemented how we can assure certain connectivity levels for mission critical applications there's something in the standard called network slicing which we think will be very important for business customers and will provide a lot of value for them which hopefully will be shared the other aspect that we haven't really talked about is how 5G might be critical for domestic small and medium enterprises as well to get to be part this is a tool that could be part of the digital transformation there's a lot of pretend value in this for which it's not necessarily something that is easy to capture for players Miss Chen, would you like to add anything? I think pretty much our panelists covered every aspect of it I think 5G network is not when we think about it and talk about it, it's no longer the previous generations it's more secure and it's with network slicing you can really it's really hard for you to do over the top and provide just use the connectivity to do over the top all right, thank you very much I think that wraps it up for our session, we have run out of time so thank you very much for the audience and for our speakers for a very instructive and inspiring session thank you very much