The 5G race is on, but Europe is lagging behind

 
Arjun Kharpal
SPAIN-TELECOM-WORLD-MOBILE-CONGRESS
The Mobile World Congress took place last week (Source: Getty)

Last week week, Mobile World Congress — the biggest mobile event in the world — took place, with 5G at the front and centre of discussions.

Huge stands from giant telecoms companies to network equipment players highlighted the efforts in the 5G space.

The industry talked up how the next generation of mobile internet could bring blistering download speeds, streaming of virtual reality games, support for driverless cars, and a whole host of other applications.

It’s clear that the race for 5G is on.

What’s even clearer is that Europe is at risk of falling behind the US, China, and other parts of Asia.

Korea Telecom, one of the companies involved in 5G trials at the Winter Olympics, had a demonstration of a virtual reality game streamed over the super-fast mobile internet standard.

Meanwhile, Hans Vestberg, chief technology officer at US mobile network Verizon, told CNBC that the the US and parts of Asia are really ahead on 5G.

But in contrast to the hype and optimism shown by the Americans and Asians, the Europeans struck a reserved tone.

The EU’s own lawmakers even seemed on edge.

Andrus Ansip, the European commissioner responsible for the so-called digital single market, told CNBC he was worried in an interview last week.

The EU has set out connectivity goals. One of those is that at least one major city in each member state must have fully commercial 5G running by 2020.

To meet the goals, Ansip said that €500bn of investment will be required. But, at the current pace, a €155bn funding gap will remain.

Part of the issue in Europe is spectrum allocation, which is the radio waves required for various communication standards.

While other countries are pushing ahead and making spectrum available for 5G, Europe is fragmented on the issue.

Last week, EU lawmakers decided to free up 5G radio frequencies for a 20-year time period. But many in the industry, including the GSMA (a body which represents mobile operators globally), called for a 25-year time period, arguing that it would spur more investment.

Before the new EU laws were decided, Mats Granryd, the director general of the GMSA, told CNBC that a longer period of spectrum ownership was needed.

“It will take time to build these networks and to get return for that investment. Therefore, we need to feel secure that the spectrum we rightfully bought will be ours for a long period of time,” Granryd said.

Another issue is the different rules across the EU member states.

US mobile carriers like AT&T and Verizon have committed to start rolling out 5G this year. Meanwhile, China is shaping up to be the biggest 5G market by 2022, according to data from CCS Insight.

While 5G promises breakneck internet speeds, the sluggish movements of the EU could see it trailing behind, and that’s bad news since the technology could prove a boost to business, consumers, and ultimately the economy.

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