Vodafone talks up 5G's cost-saving benefits for public buildings

This is the thrust of some research by WPI Strategy that was commissioned by Vodafone as part of its ongoing effort to garner support for its proposed tie-up with Three.

The study claims that by deploying digital twins, IoT and smart sensors at public buildings, the average town of 40,000 residents could shave £350,000 off their annual energy bills. For the UK as a whole, these savings would weigh in at £580 million per year.

Voda claims reliable 5G SA coverage holds the key to unlocking these benefits. If permitted to merge with Three, the telco has promised to spend £11 billion to blanket the UK in 5G SA over the next 10 years, reaching 99% of the population by 2034. It has also pledged to cover every school and hospital by 2030.

"With rising costs and constrained budgets, councils across the UK are feeling the squeeze and communities are suffering as a consequence," said Vodafone UK's chief network officer Andrea Dona. "We know how important public spaces are to local towns, with over half of people saying they bring the community together in a positive way, so we must protect them."

It's worth pointing out that according to Ofcom's most recent Connected Nations report, 92% of UK premises had outdoor 5G coverage from at least one MNO. As a four-player market, UK 5G deployment appears to have been quite successful.

Voda and Three would probably argue that these measurements don't provide enough detail, and to a certain extent they would be correct.

Figures from Ookla, albeit from February 2023 – so not the freshest – show that median 5G download speed in the UK back then was 129.14 Mbps. That's far slower than world leaders the U.A.E. (545.53 Mbps), South Korea (493.25 Mbps) and Qatar (467.33 Mbps).

There's certainly plenty of room for improvement for 5G in the UK then, and standalone is a good place to start. More recent figures from Ookla show that in Q2 of this year, median 5G SA download speed in the UK was 186.25 Mbps – a noticeable up-tick, but there is still more work to be done.

The question of whether the UK needs to consolidate into a three-player market in order to deliver these required improvements is one that Voda and Three claim to have answered.

And yet, interestingly enough, the previous government set a target of covering all populated areas of the UK with 5G SA by 2030, which is a more ambitious timescale than Voda and Three's pledge to get to 99% by 2034.

So, either the last government was being too ambitious, or Voda and Three are in a market that is already functioning well enough that such targets are eminently achievable, which would undermine their case for consolidation.

The Competition and Markets Authority (CMA) has until 12 October at the latest to conclude its in-depth, Phase 2 investigation into the merger, so there are still a few months for Voda and Three to do some lobbying. At this point in the proceedings, the outcome is far from settled.