A new study conducted by Analysys Mason, on behalf of Ericsson and Qualcomm, has calculated the effect that 5G use cases will have on the UK’s economy, and has concluded that it can deliver £14.8bn in additional economic growth for the UK, with a five-fold increase in ROI, at a cost of £3bn.
And what’s particularly noteworthy about the study – titled ‘Cost-benefit analysis on full 5G deployment’ – is that, of the £14.8bn in projected contribution from 5G technology, more than 75% of that will come from just three sectors: manufacturing, construction and agriculture.
“This new research shows that 5G technology will be a foundation for the UK’s future as it recovers from COVID-19 and builds a world leading digital economy,” said John Griffin, head of Ericsson UK & Ireland. “As an open innovation platform, 5G will accelerate digital transformation and help the UK establish a truly global leadership position in the industries and technologies of the future. Ericsson is already leading the deployment of 5G in the UK and is committed to developing the early use cases that will deliver the economic, social and environmental returns to build a sustainable and resilient infrastructure for future generations.”
Current state of 5G in the UK
The study, which used modelling and calculation flows based on the impact of previous generations of mobile technology, has also found that the UK is performing at an ‘average’ level, regarding the current state of 5G rollout in the United Kingdom.
“The estimated 5G population coverage in the UK was 30% as of Q3 2020, placing it near the average for European countries where 5G has been launched,” the report said. “MNOs in the UK, as in several markets across Europe, have now launched initial 5G services, which are based on 4G infrastructure. Further technological evolution within the UK 5G networks is expected, with migration to stand-alone, virtualized 5G architectures.”
The study from Analysys Mason found four key ‘clusters’ where 5G would have the largest impact within the UK, which were: Smart Production and Logistics; Smart Rural; Smart Urban; and Smart Public Services.
“The Smart Production and Smart Urban clusters have the largest net benefit (i.e. benefit minus cost), of £4.1bn and £4.5bn respectively, although the cost-benefit-ratio of the Smart Production cluster is four times lower than that of the Smart Urban cluster, reflecting its substantially higher costs,” the report explained.
Despite not being the slowest to adopt 5G technology in Europe, the UK is falling behind its competitors, and there are a number of recommendations within the study, which analysts say will be crucial for the UK to remain competitive. These include:
- Ramping up the availability and uptake of 5G infrastructure for use in priority sectors relating to production and logistics, such as manufacturing, freight and utilities, that will see the largest and most significant benefits
- Extending 5G coverage further into rural areas
- Encouraging operators to roll out high-density networks to provide very high capacity for 5G in urban applications, such as construction
The report highlights several challenges the UK faces in realising the full benefits of 5G, as it has fallen well behind the likes of Switzerland and Finland, and is currently on-par with countries such as Denmark and Sweden.
You can download the full report here.