5G – the fifth generation of mobile broadband – is rolling out across the world, and many European nations are now offering 5G services to subscribers. Although the overall European roll-out lags that of the United States and China, momentum seems to be building on several key fronts.
Investing in the future: a period of heavy spending
Licenses to operate on 5G-compliant frequencies are granted by federal telecommunications authorities, through auctions in which telecommunications companies bid to purchase blocks of spectrum. This can raise billions of euros for national coffers. Telekom Deutschland GmbH paid 2.17 billion euros in 2019 to utilize the 700 MHz and 3.6 GHz frequencies, in an auction that raised 6.5 billion euros overall.
In most countries, the bulk of the 5G service will be achieved using the 700 MHz frequency, which offers improved range at a lower speed. Germany, for example, will have 99 percent of the population covered by 700 MHz services by the end of 2025, and 43 percent of the population will be covered by 3.6 GHz services. (1246342) Data transfer is much fast over 3.6 GHz, but range is more limited. Similar levels are seen in other countries, including France and Italy.
While the ability to stream movies and music without suffering through buffering is nice, it is not the main factor driving the growth and investment in 5G. Governments and industries are expecting significant economic benefits arising from improved productivity and enhanced access to technology, making the cost-benefit ratio a favorable one.
Across Europe, industries such as construction and agriculture could see overall benefits almost ten times higher than the costs associated with 5G upgrades. Smart factories are set to see great benefits as well, with an improved connection density, lower latency, and faster data transfers unlocking benefits amounting to 67.1 billion euros, against costs of 10.5 billion euros.
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