£15bn: 5G’s economic promise to the UK

New research from Analysys Mason, done at the behest of Ericsson and Qualcomm, suggests that the UK could stand to gain £14.8 billion in economic growth in the 15 years between 2025 and 2045 if it manages to harness 5G correctly.

 

The study, which explores the economic value of 5G in individual market segments, found that over three-quarters of the projected increase will be generated in three specific industries: manufacturing (£5.2bn), construction (£4.2bn), and agriculture (£2.2bn).

 

The overall expense of 5G in this scenario will be around £3 billion, although it should be noted that Huawei has recently reiterated claims that their exclusion will set back the UK’s 5G deployment by up to three years and cost the country an additional £2 billion.

 

The report also made a variety of policy recommendations for the UK to help the country maximise the value of 5G; for example, suggesting that around £800 million in subsidy funding for rural areas could deliver around £2.5 billion in economic return, according to their models. 

 

In short, the authors of the study suggest that 5G infrastructure will need to be rolled out for priority industry sectors and rural areas as quickly as possible if the UK is to see the maximum benefit.

 

Reports like this should always be taken with a grain of salt – not least because they have been commissioned by two companies with a vested interest in immediate 5G investment – but it does, nonetheless, highlight the importance for telcos of making a connection with industry players early in 5G’s lifecycle. 

 

This necessity for industry partnerships is something that telcos have quickly begun to realise in recent months. Indeed, we have seen a range of such partnerships recently, with Orange and Ericsson recently teamed up with electronics manufacturer Lacroix to develop France’s first smart factory, and Ericsson doing something similar with BT and Worcester Bosch. The automotive industry is another area where we see rapid movement, with Vodafone partnering with Ford to use 5G for electric-vehicle production. These partnerships are coming so fast, in fact, that one occurred earlier today, with France’s Bouygues Telecom announcing a new partnership with IBM, focussing on creating use cases for industry and reaching out to industry partners.

 

For mobile customers, 5G is unlikely to be a game changer, especially in the early stages. However, for industry and enterprise the possibilities unlocked by this new technology are enormous. For now, in the early phases of 5G deployment, the crucial question is how seamlessly the telecoms and industry sectors can fit together for their mutual gain.