GSMA says Europe’s 5G rollout is too slow

Telco trade body the GSMA says in order to stay competitive European economies must ‘digitalise’ themselves through faster 5G rollouts, and manages to crowbar in the ‘fair contribution’ argument.

The trade body and owner of MWC has released its 2022 Mobile Economy Report for Europe, in which it states the EU will not meet its ‘digital decade goals’ unless it starts rolling out 5G faster across the continent.

What are these goals? Last year the European Commission set some out some aspirations around digital skills, digital transformation of business, sustainable digital infrastructures and the digitalisation of public services that it would like to see achieved by 2030. By generally upgrading and upskilling Europe, the assertion is tangible benefits for EU economies will follow.

In terms of 5G progress, the GSMA cites another of its reports which states at the end of June 2022 108 operators in 34 markets across Europe had launched commercial 5G services, while consumer uptake was at 6% of the mobile customer base. Norway trended above this with 16% of its citizens using 5G, followed by Switzerland (14%), Finland (13%), the UK (11%) and Germany (10%). The report predicts that by 2025 the average adoption of 5G across Europe will be 44%.

Good news? No, says the GSMA – because by that time South Korea is expected to hit 73%, whilst Japan and the US are likely to achieve 68% adoption. That’s a problem apparently because Europe will fall behind in terms of ‘digitalising’ its economies, and that means industry and manufacturing will be less competitive.

Fine – but what is it suggesting is done about this? It wants policymakers to ‘create the right conditions’ for private infrastructure investment, network modernisation and digital innovation – about which the press release doesn’t go into specifics but could be something along the lines of tax breaks for telcos, which has been suggested before in some way shape or form. And then there is this:

“Europe is adopting 5G faster than ever before, but greater focus on creating the right market conditions for infrastructure investment is needed to keep pace with other world markets. This should include the implementation of the principle of fair contribution to network costs,” said Daniel Pataki, GSMA Vice President for Policy & Regulation, and Head of Europe.

Which of course is a reference to the ‘fair contribution’ argument that telcos and now the GSMA itself has been making for some time now, which in a nutshell says that since internet firms like Netflix and Facebook make tons of money, they should contribute to the building of physical network infrastructure because it is expensive and telcos don’t make as much cash as they used to.

This announcement from the GSMA goes a bit further than saying it’s unfair that content providers make much more margin streaming TV shows that telcos do on digging holes and dragging up towers, and seems to be asserting that unless something is done about all this then the entire continent of Europe will become uncompetitive on the world stage.

Whatever twist the argument is made with in the future, we’re undoubtedly going to hear it many more times. Sceptics of the position are still going to have be persuaded that it’s an injustice that streaming services are at this moment in time are making more profit on subscriptions than telco companies are on 5G towers. And then of course there is the question of what exactly is being suggested be done about it, since it seems unlikely the boards of Netflix, Google and Facebook are going to wake up one morning and decide they are going to volunteer a few billion each out of the goodness of their hearts.

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