EU needs to invest €300bn in 5G to remain competitive, research group warns

The EU currently invests only €16.4 billion (£14bn) per year in mobile networks

Europe will need to invest €300 billion (£258bn) into its telecoms infrastructure by 2025 if it wants to tap into the potential of 5G technology, according to a new report by management consulting firm BCG.

The sum includes an estimated €150 billion (£129bn) needed to achieve a full-5G scenario across the European Union, with an additional €150 billion required to finalise the works involved in upgrading its infrastructure to gigabit speeds.

The report, which was commissioned by the European Telecommunications Network Operators (ETNO), an EU telecoms lobbying group, found that the 5G rollout alone would help the EU recover from the financial effects of the coronavirus pandemic, creating 2.4 million new jobs and adding €113 billion (£97bn) to the bloc's overall GDP.

ETNO’s director of Strategy and Communications, Alessandro Gropelli, told IT Pro that at the moment, the EU invests only €16.4 billion (£14bn) per year in mobile networks. However, this amount also includes investments into all current generations of networks, such as 4G.

Gropelli also added that CapEx should be 2.4 and 3.2 times higher than it is now by 2027, which would allow the EU “to move to full gigabit and full 5G”.

The report also suggested implementing legislation which would make it possible for telecoms providers across the 27 EU states to cooperate and co-invest, potentially splitting infrastructure construction. According to BCG, operators should also be allowed to monetise data traffic on their networks, which would help them catch up with American tech giants such as Google, Facebook, and Microsoft.

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BCG managing director and senior partner, Wolfgang Bock, said that it's vital that the EU “makes the necessary investments to be able to remain competitive”.

“Today, 83% of EU SMEs do not use advanced cloud services and over 60% nine-years-olds are in schools which are still not digitally equipped. Our report maps a route for Europe to build a more digitally skilled workforce and create millions of jobs,” he added.

Earlier this month, it was announced that the EU is expected to allocate an estimated €2 billion to fund digital projects over the next seven years, part of which will be dedicated to the development of high capacity digital networks and 5G systems, the digitalisation of transport and energy networks, and the rollout of 5G coverage across important transport axes.

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