This paper investigates the effect of oscillator phase noise and channel variations due to fading on the performance of communication systems at frequency bands higher than 10GHz. Phase noise and channel models are reviewed and technology-dependent bounds on the phase noise quality of radio oscillators are presented. Our study shows that, in general, both channel variations and phase noise can have severe effects on the system performance at high frequencies. Importantly, their relative severity depends on the application scenario and system parameters such as center frequency and bandwidth. Channel variations are seen to be more severe than phase noise when the relative velocity between the transmitter and receiver is high. On the other hand, performance degradation due to phase noise can be more severe when the center frequency is increased and the bandwidth is kept a constant, or when oscillators based on low power CMOS technology are used, as opposed to high power GaN HEMT based oscillators.