After being one of the first countries to begin implementation back in 2019, analysts say the UK is in danger of falling behind in the global race to roll out 5G networks 

The UK is at risk of being left behind by its international competitors when it comes to 5G, at least according to a new report from the Financial Times. 

Citing a June report from research company OpenSignal, the FT notes that the UK ranks 39th out of 56 countries when it comes to 5G availability, with the average mobile phone users being connected to a 5G network 10.1% of the time. Furthermore, the UK ranked 49th out of the 56 in terms of average download speeds, falling behind Germany, France, and the USA.  

These poor results are likely due to a combination of insubstantial investment from mobile phone operators and the disruption caused by the government’s ban on Huawei. 

UK mobile networks need to invest an estimated £34 billion on 5G infrastructure by 2030 in order to meet the demand of new technologies, such as driverless cars and more efficient waste collection services. However, the actual estimated spend by UK operators is expected to be around £9 billion, falling well short of the targets needed to fulfill chancellor Jeremy Hunt’s wish of turning the UK into the next Silicon Valley. 

Vodafone and Three have also warned that if their UK merger is blocked 5G investment will slow even further. The firms have pledged to spend £11 billion on the project over the next decade if the merger gets the green light. Whether such promises are enough to convince regulators to allow the deal, which would shrink the UK’s mobile market from four players to three, remains to be seen. 

This lack of investment in 5G has contributed to the UK’s 5G performance falling well below other developed markets, which, in turn, has led to an underwhelming public perception of the new technology. According to data from Uswitch, less than half of mobile users have noticed speed improvements since the advent of 5G in the UK and one in six users said they felt the technology is overhyped.  

These statics could be caused by the detachment we are currently seeing between “what had been promised in terms of revolutionary experiences and what we’re actually able to do on our devices,” explained Uswitch. 

The UK’s ban on Huawei, implemented by Boris Johnson in 2020, has undoubtedly slowed the 5G rollout, driving up costs and complexity for operators as they replace Huawei equipment. When first announced, BT estimated that replacing Huawei equipment in their network would cost them £500 million; while this figure was later reassessed due to the agreement of a longer transition period, the replacement of Huawei equipment has still played a significant role in the 5G rollout delay. 

Ultimately, the challenge here for operators is one of monetisation. While firms like Assembly Research have long held that 5G could be worth over a hundred billion pounds to the UK economy, translating such expectations into telco revenue streams has been difficult.  

As noted, most consumers are not seeing a major benefit from 5G and so are unlikely to pay a premium for the technology. This has led telcos to increasingly target the enterprise segment to recoup their 5G investment, creating new 5G use cases and deploying bespoke private mobile networks. However, adoption in this space has been relatively slow, with major enterprises needing significant coaxing to shell out for 5G solutions. 

As Jeanie York, CTO at Virgin Media O2, told the FT, “everybody in the industry in this country is waiting for the right killer application that’s going to help us get a return on our investment”. 

The £40 million funding announced by the government this week, aiming to turn local and regional authorities into ‘5G Innovation Regions’, may go some way to help promote the further development of 5G in the UK, but projects of such a small size are unfortunately just a drop in the ocean when it comes to the scale of the 5G challenge facing the UK.  

How will the UK’s 5G implementation play out? Join in the conversation at this year’s live Connected Britain conference 

Also in the news: 
Vocus offers TPG Telecom $4.2bn for fixed infrastructure assets
TalkTalk mulls break-up as debt pressure grows
Telefónica and Sateliot make history with 5G roaming space connection