«All over Europe the development of 5G is influenced by the high costs for the spectrum and by heavy regulatory interventions that are blocking progress. Governments must begin to consider the policy of access to frequencies as a means to provide critical national infrastructures, rather than a source of tax revenues “.
Arun Bansal, president of Ericsson in Europe and Latin America, posted a good observation to understand the implementation of the mobile future standard that promises user response times equal to those of the human brain. It promises the development of digital and interconnected cities, remotely managed industrial automation and cloud computing, the go-ahead for the era of hetero-driven driverless microprocessor-driven cars that will communicate with antennas.
To do this, telephone operators in some European countries had to compete with each other to grab the most valuable frequencies by paying over 6.5 billion euros to the state as a whole. According to Bansal, an own expense for the country. Because it risks delaying the development of the infrastructure given the implementation costs: “The Italian auction, for example, should have served as a warning to the other regulators on how not to assign the spectrum, but now we have recorded costs exceeding expectations even in Germany. Before this “era” of high spectrum costs, Europe was the undisputed leader in mobile services, the same cannot be said now “. For Bansal it would also be necessary to «unlock the transformative power of 5G.
This means getting access to government assets such as some buildings and street structures such as street lamps. If we look at the United States as a source of inspiration, last year the FCC issued an order that eliminates regulatory obstacles to the implementation of wireless infrastructure. I don’t think it’s a coincidence that the greatest technological innovations driven by the mobile, like Uber, Netflix, Airbnb, Tencent and Alibaba, have developed elsewhere. Europe was not fast enough in implementing 4G. The United States and China have continued and built high-performance 4G networks before Europe, developing the world’s most innovative app companies “.
This is why the technological challenge between States, Europe and China will be played on the 5G implementation schedule. The Old World is also penalized by an extremely fragmented telco market, with over 100 mobile operators. A sector that has seen a loss of a total turnover of 27% in just seven years, with heavy employment and a loss of value for shareholders. A compensation could be to review the duration of the frequency concessions.
According to Bansal, “the traditional spectrum approach that generates high tax revenues is crippling operators. Governments should evaluate the 5G spectrum based on potential economic and social benefits. The current duration of the licenses is generating greater uncertainty in the investments among the operators when approaching the end of the validity period “.
And on Vodafone’s strategy of creating a new tower company in Europe, while in Italy Tim and the same Vodafone announced synergies to generate operational efficiencies in view of the implementation of 5G, Bansal comments: «Without going into the merits of individual choices of the customers, like Ericsson, we can immediately make available to the operators our commercial solutions, 5G for example, which allow the sharing of passive infrastructures and the sharing of the active component of the mobile network. In Italy we can also leverage the technological skills of about 3,000 professionals, 25% of whom have a researcher profile ».
Maurice Esma, a co-founder of EconomicInform is a freelance journalist with the expertise in international finance and corporate rights. The author can be reached by email firstname.lastname@example.org