03 July, 2023
ETNO-GSMA position paper: European Spectrum Policy for the Digital Decade – options for the new Radio spectrum policy programme
Global events over the last three years have reminded us that advanced telecom networks are essential if Europe is to be successful in its pursuit of global leadership in the digital economy, remaining secure and resilient in the face of unpredictable global threats, and able to achieve its migration towards net-zero.
Digitalisation will revolutionise the global economy over the next 10 years, by transforming everything from transport, manufacturing, healthcare, education, energy management and public services. By 2030, digital technologies and connectivity will be the very fabric of our societies and economies. The ubiquitous availability of high speed, low latency 5G connectivity will drive this revolution - and it will be those regions of the world that deploy 5G first that will be positioned for global success in creating and controlling these new digital environments and economies. Europe is in a “lead or lose” situation. Our strategic interest is to lead the future of connectivity. As European telecom operators, we work to stay ahead of the curve in roll-out of 5G and FTTH, development of new network and cloud technologies, digital inclusion and the twin green-digital transition.
The EU’s Digital Decade envisages full 5G or 5G equivalent coverage by 2030, which means ensuring digital equality and inclusion for all European citizens and businesses no matter where they are. Mobile broadband has been proven to be a catalyst for GDP growth[1],[2], as a basis for social inclusion and wellbeing and a powerful tool in the fight against climate change. [3] As Europe seeks to emerge from the uncertain environment of the pandemic and deliver the twin digital and green transition, mobile has an important role to play in connecting everyone and everything everywhere.
The important question is how do we deliver on this vision? While most countries in Europe have deployed commercial 5G services, and nearly two-thirds of operators in the region have launched 5G networks, it is clear that there are large differences between Member States, between urban and rural areas and most worryingly between Europe and other leading regions.
Moreover, ‘full’ standalone 5G — where 5G is also deployed in the core of the network — is needed to deliver the promise of the technology. We remain far from that point in the EU, and significantly behind the leading countries. Asia Pacific leads the way in terms of live standalone 5G deployments, while such services are only now starting to be deployed in a few EU Member States.
In addition, 5G coverage is just one high-level indicator by which to measure the Union’s progress. It is also necessary to consider 5G adoption, capacity, quality of service (QoS) and investment levels especially in comparison with other regions. Furthermore, in those areas with larger rural or dispersed populations there is a danger that a lack of sufficient 5G services will compound inequalities in poverty, social exclusion and digital skills.
Europe already has an investment gap in telecom networks and services (€174 billion as estimated by the EC[5]), in conjunction with overall declining or flat revenues in the sector, returns below the cost of capital, weak market valuations and high levels of debt. In our view, policy change can help shape a future in which Europe innovates, grows and stays in control of its connectivity. However, reversing the downward trend in mobile investment in Europe requires a set of remedies - including radical reform of spectrum policy - to recreate an environment that can recover investor appetite for the sector and rehabilitate a healthy investment capacity for the sector.
At a time when telecom networks are widely acknowledged as critical network infrastructure (CNI) and enablers of the twin digital and green transition, the sector faces serious challenges that, if not addressed, will prevent Europe from establishing itself as a digital leader for the coming decades.
Critically, this must include, from a spectrum policy perspective: prolonging existing licences to align with investor timeframes; preventing distortive or inefficient awards for new spectrum; minimising the cost burden of annual spectrum fees; and securing a pipeline of new harmonised mobile spectrum bands (such as 6 GHz) to accommodate future traffic demands in an energy and cost effective way – the RSPP therefore must take a more pro-investment approach and ensure the broad spectrum provisions already in the European Electronic Communications Code (EECC) are clarified further to achieve a more harmonised approach to licensing and more concrete and ambitious investment outcomes across the Union.
Furthermore, with 5G networks having much greater minimum scale at local level[6], consolidation is essential. While consolidation falls under the competence of DG-COMP, it is imperative that also through the RSPP, the RSPG and DG-CNECT set out clearly why the scale which can be achieved through consolidation is necessary for 5G deployment as it will benefit consumers and speed up the achievement of the EU Digital Decade’s targets.
We elaborate on our positions in the paper. For questions and clarifications regarding this position paper, please contact Xhoana Shehu (shehu@etno.eu), Policy Manager at ETNO, and Emma O’Toole (eotoole@gsma.com), Senior Manager, Spectrum at the GSMA Europe.
[1] The Mobile Economy 2023, GSMA, March 2023
[2] The Socio-Economic Benefits of Mid-Band 5G Services, GSMA, February 2022
[3] Mobile Industry Impact Report: Sustainable Development Goals, GSMA, September 2022
[4] Austria, Bulgaria, Finland, Germany, Italy and Spain, GSMA Intelligence
[5] Exploratory consultation - The future of the electronic communications sector and its infrastructure, European Commission, February 2023
[6] A large majority of investments are made in assets that need to be geographically close to end users
