UK in danger of falling behind on 5G network rollout, analysts warn

The UK is in danger of becoming an also-ran in the global race to roll out high-speed fifth-generation mobile phone networks, capable of supporting the government’s efforts to turn Britain into the next Silicon Valley, according to analysts and industry executives.

Despite being one of the first countries to start implementing 5G commercially in 2019, the UK is now falling behind because of limited investment by mobile phone operators and disruption caused by the government’s ban on kit from Huawei, the Chinese telecoms equipment maker.

Ofcom, the telecoms regulator, said in May that 5G mobile coverage from at least one operator was available at 82 per cent of places where people live and work in the UK, but the figure falls to 22 per cent for areas covered by all network providers.

5G availability, expressed as the percentage of time a mobile phone user is connected to dedicated networks rather than other wireless technologies, is only 10.1 per cent in the UK, placing the country 39th among 56 advanced and developing markets, according to a report published in June by OpenSignal, a research company.

The UK’s 5G download speed ranked the country 21st out of 25 developed markets, and slower than France, Germany and the Netherlands, according to a report released in February by Ookla, a company that analyses mobile networks. The result comes despite the UK having the largest 5G-capable smartphone sales in Europe.

“The promise of true 5G is yet to be realised,” said Paolo Pescatore, analyst at PP Foresight, a research business. “There’s been a lot of hype around 5G with telcos having invested billions . . . and rolling out networks. Arguably, the UK has lost its place to be a 5G leader.”

“We were early adopters of 5G but now we are falling behind,” said Andrea Dona, Vodafone UK’s chief network officer, adding that Britain had failed to grasp the initiative despite past mistakes with the slow rollout of previous wireless technologies.

The protracted expansion of 5G networks in the UK comes despite evidence of clear economic benefits and the government’s goal of having high-speed mobile networks.

5G could be worth as much as £173bn to the UK economy over the next decade in improvements to productivity and the development of connected cities, driverless vehicles and other technologies, according to Assembly Research, a telecoms consultancy.

5G can enable the systems in driverless cars to receive information and, for example, ensure that they respond within a fraction of a second to unexpected actions by pedestrians. 

5G can also help cities better manage energy supply and become more sustainable.

The government said last year that it had met its 2027 goal to deliver a basic 5G signal that uses dedicated masts and radio spectrum but relies on 4G networks for the majority of the UK population. Ministers have also set a target for all populated areas to be covered by 5G networks by 2030.

Chancellor Jeremy Hunt used his Autumn Statement to highlight the importance of 5G, as he also stressed his priority of nurturing economic growth through innovation.

“I want to combine our technology and science brilliance with our formidable financial services to turn Britain into the world’s next Silicon Valley,” he said.

But Sylwia Kechiche, analyst at Ookla, said: “5G in the UK is in the lower performance category, and the risk of the UK falling behind can translate into slower economic growth.”

Mobile industry executives highlight the decision of Boris Johnson’s government in 2020 to strip Huawei out of Britain’s nascent 5G networks because of national security concerns as a reason for the slow rollout.

“That absolutely put the brakes on deployment for the operators,” Matthew Howett, chief executive of Assembly Research, said.

There is also little sign of a public clamour for 5G. One in six mobile users felt the power of 5G had been overhyped, and less than half said they had seen noticeable speed or reliability improvements since upgrading their device, according to a survey published in October last year by Uswitch, the price comparison service.

The benefit of 5G is varied even within the UK. The download speed uplift by switching from 4G to 5G was marginal in London compared with other cities, according to a study by OpenSignal released in March.

“The core concern from consumers in terms of overhype is that disconnect between what had been promised in terms of revolutionary experiences and what we’re actually able to do on our devices,” Uswitch said.

Mobile operators said the investment numbers for 5G did not add up yet. UK operators will spend about £9bn by 2030 on 5G rollout, falling short of the estimated £34bn needed to offer services that rely on such networks, such as driverless cars, the Digital Connectivity Forum, an industry advisory group, said in a report in September last year.

Vodafone and Three, which want to merge their UK mobile operations, have warned that there will be even slower investment in 5G if competition authorities block their proposed deal.

The merger would reduce the number of UK network operators from four to three: the combined entity, plus EE and O2. Consumer group Which has expressed concern that this could reduce choice for consumers and raise prices.

Vodafone and Three have promised to invest £11bn in the UK over 10 years to create one of Europe’s most advanced 5G networks.

“This merger is all about the quality of infrastructure in the UK,” Robert Finnegan, chief executive of Three UK, said.

However, Pescatore challenged the argument that the fate of the UK’s 5G rollout was determined by the merger, saying that mobile operators were already years behind schedule with proving the value of high-speed networks.

Many industry figures said 5G had been designed with future business uses in mind.

“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,” Jeanie York, chief technology officer at Virgin Media O2, said.