The next generation of wireless technology called 5G has finally arrived in the United States, laying the groundwork for innovations from remote surgery to self-driving cars to become part of everyday life. But for now, speeds are too slow in most areas to make those promises a reality. The United States delivers the slowest average speed among the 15 leading 5G markets.

And until there is more demand for 5G, wireless providers are reluctant to spend billions of dollars to upgrade their networks with new antennas and towers. To understand how 5G will improve, you have to understand how portions of spectrum differ and the complex process underway to allocate additional spectrum for wireless carriers.

Types of spectrum

The full electromagnetic spectrum is grouped into different bands, such as lightwaves and microwaves. Each of these bands have different characteristics that make them ideal for specific purposes.

Low-band spectrum, with frequencies below 1 GHz, have coverage areas that can span miles but have download speeds that are closer to current 4G LTE speeds. This is the base layer that allows wireless carriers to show maps with 5G reaching huge swaths of the country.

High-band spectrum, often referred to as wideband, can transmit a lot of data quickly over very short distances. It requires many more antennas to maintain greater reach. This spectrum is best suited for cities, though it can be obstructed by buildings and trees.

Mid-band spectrum is the sweet spot in the middle that has a desirable mix of faster speeds than low-band but can reach distances of several miles.

Data from OpenSignal shows that high-band spectrum delivers speeds on average 100 times faster than lower bands serving most of the country. In fact, the speed of your home office wifi might just be faster depending on where you live.

The mix of spectrum available for wireless carriers across these three bands directly impacts the speeds delivered to consumers.

So far, the 5G offering in the United States has been a trade-off between speed and coverage due to the spectrum holdings by mobile carriers.

Verizon leads with high-band spectrum holdings, while competitor T-Mobile holds more of the desirable mid-band spectrum.

The auction concluding this year was a rare instance to boost mid-band spectrum holdings and mobile carriers bid a record $78 billion.

Verizon spent $45.4 billion on licences to bolster its mid-band spectrum holdings but did not overtake T-Mobile, whose mid-band holdings were previously boosted by the merger with Sprint.

Mobile carriers are placing big bets on 5G through the acquisition of additional spectrum and it is unclear how these investments will pay off. Even after acquiring rights to spectrum, carriers then have to invest in towers and infrastructure.

Why spectrum allocation is complicated

Spectrum regulation dates back to the early 1900s and has evolved as new technologies have emerged. Because the amount of available spectrum is finite, it is carefully allocated by governments, often via auctions for private use, and its use is highly regulated.

Additional spectrum could eventually be made available as part of the infrastructure bill working its way through Congress. The legislation proposes funding for the Department of Defense to research spectrum sharing and to make available additional spectrum licenses in late 2024.

But according to Moffett, the rollout of 5G is a chicken-and-egg problem. Until there is a network, self-driving cars and remote surgeries will not happen. But until there is a business case for 5G networks, wireless providers are slow to spend money building antennas and towers.

For consumers, the promise of 5G is still a ways off. Even as the technology evolves, your experience will depend on where you are and the type of spectrum you can access.