The UK will take a multibillion-pound blow to productivity and economic prosperity should the 5G rollout be held up further, a new report from the Centre for Policy Studies (CPS) claims.
The report – "Upwardly Mobile: How the UK can gain the full benefits of the 5G revolution" – written by former UK.gov advisors Alex Jackman and Nick King warned that "the delivery of 5G infrastructure is stalling".
"Government's 'levelling up' agenda and the UK's recovery from the Covid-19 pandemic is at risk without a faster 5G rollout – to the tune of £41bn," the pair wrote. They claimed that if the delays continue at their current rate, then by 2027 some 11 million households and businesses would miss out on "vital digital connectivity".
Conversely, should carriers and the government exceed the rollout ambitions by bringing 5G to 64 per cent of the population by 2027 – the current target is 51 per cent – as much as £41.7bn could be added to economic output. That, the CPS noted, is a relatively moderate estimate. In a best-case scenario, the windfall could be as much as £52.6bn.
"The difference between the UK being a leader and a laggard in 5G adoption could be as much as £173bn in incremental GDP over the coming decade, as estimated by the Future Communications Challenge Group," the report added.
This boosted economic output is representative of growth in various different sectors being lifted by the next-generation network, the report claimed. Service-based businesses will, in some cases, benefit from faster and more stable connections than those typically provided by fixed-line connections.
The authors noted that the UK government has an uphill battle ahead, with the rollout vastly complicated by the recent decision to ban Huawei. Networks are prohibited from purchasing new Huawei-made 5G gear from the end of 2020, and are commanded to rip-and-replace existing hardware by the end of 2027.
Oliver Dowden MP, the Secretary of State for Digital, Culture, Media and Sport, estimated in July that the Huawei ban "will delay rollout by a year and add half a billion [pounds] to costs".
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To mitigate that, the CPS urged significant changes to the UK planning law that pertains to communications infrastructure, the Electronic Communication Code. First written in 1984, this legislation was heavily modified by the 2017 Digital Economy Act with an aim to expedite wireless deployments, particularly those in rural areas. The CPS strongly doubts the efficacy of those reforms, with many new deployments mired in contractual and legal disputes.
The answer, according to the report, is to remove ambiguity and ensure the Electronic Communication Code is the overriding legislation in this regard. It also wishes to see judges empowered to backdate rental agreements for cellular sites and to grant broader rights to infrastructure owners.
Commenting on the report, Matt Warman, Minister for Digital Infrastructure, said: "It is our national mission to futureproof the UK's network with revolutionary 5G technology. Thanks to government and industry action 5G is available in more than 70 towns and cities.
"Alongside record amounts of funding, we are exploring how to bust any barriers holding back industry from speeding up rollout. We've committed to reforming planning law and to consult on whether further reforms to the Electronic Communications Code are needed and will consider the points raised in this report carefully."
The report echoes similar findings made in Huawei-commissioned research by industry analyst Assembly, which argued that the delayed rollout caused by the new rip-and-replace mandate will have a dramatic impact on economic output and productivity growth.
In a statement provided to this publication, Huawei vice-president Victor Zhang said: "This is the latest of a series of high-profile reports all of which agree on one thing: that removing Huawei from Britain's 5G network will cost the UK billions in economic benefits, significantly push up costs for businesses and consumers and will likely leave millions with slower connectivity while expanding the digital divide."
The challenge facing Britain and the industry, to build a thriving competitive landscape that encourages more tech businesses to make 5G infrastructure equipment, isn't one that will solved anytime soon. Outside of Nokia, Ericsson and Huawei, there is just Samsung and ZTE.
As Amy Karam, fellow at the Canadian Global Affairs Institute, said back in July – a week after that fateful Huawei decision – not enticing more vendors to build a vital technology, albeit one this is not hugely profitable, was a "failure of capitalism". ®