Europe needs a €300bn (£257bn) investment in its telecoms infrastructure if it wants to take full advantage of 5G and its associated economic benefits, according to a report from telecoms lobbying group ETNO.
ETNO’s report suggests that investment on this scale could benefit Europe to the tune of 2.4 million new jobs over the next four years, while also boosting economic growth and accelerating green transformation.
The release comes prior to a meeting of EU heads of state for the European Council where they will discuss the future of Europe’s industrial and digital policy.
The new analysis, carried out by consulting firm BCG on behalf of ETNO, finds that 5G alone can generate an annual increase of €113bn in GDP by 2025. The construction of gigabit networks and new digital services could also help to increase productivity as the continent tries to recover from the Covid-19 impact.
BCG estimates that €150bn is still needed to achieve a ‘full 5G’ scenario in Europe, while an additional €150bn is required to finish upgrading fixed infrastructure to gigabit speeds.
Elsewhere, widespread uptake of digital solutions in areas such as smart cities could reduce carbon emissions by up to 15 per cent, with an additional 30 per cent emission cuts through digital transformation in the transports sector, the report said.
It added that education is failing to make the transition fast enough, with 60 per cent of 9-year-olds currently educated in schools that are not digitally equipped.
BCG estimates that upgrading the digital infrastructure of all European schools would require €14bn annually, or around 1.8 per cent of the Next Generation EU fund.
Similarly, digitalising all European SMEs would require €26bn a year, or 3.5 per cent of the Next Generation EU fund.
“The EU’s overarching digital strategies set the right ambition for digital leadership at the global level,” the report reads. “However, the spirit of Europe’s political goals must now permeate policy and regulatory action at both the European and national level.”
Delays in auctioning off 5G spectrum – the airwaves necessary for operators to start offering commercial 5G – due to governments shifting focus to counter the pandemic have also disappointed the industry.
Lise Fuhr, director general, ETNO, said: “This report shows that Europe’s gigabit opportunity is extremely relevant to today’s top challenges, including recovery and the green transition. We call on European leaders to support the telecoms sector and help us deliver a stronger digital economy for all citizens”.
Wolfgang Bock, managing director and senior partner, BCG, said: “The Covid pandemic has reinforced how reliant we are on our telecoms infrastructure for virtually every aspect of our work, education and social lives. We need to learn and apply that lesson to ensure Europe makes the necessary investments to be able to remain competitive.”
UK regulator Ofcom recently raised over £1.3bn from network operators after auctioning off additional airspace designated for 5G networks.