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Most Brits to get 5G coverage by 2027 – Japan intends to have it for 2020 Olympics

9 min read

11 July 2017

Deputy Editor, Real Business

That we’ll need better connectivity to compete online has been made clear by government statistics. Global internet traffic is forecast to be 95 times that of 2005 in 2020, with mobiles outnumbering mankind seven to one. But will our 5G ambitions be realised in time to capitalise on the change?

A CBI survey took a deeper look at the subject. Some 81 per cent of companies taking part deemed reliable mobile connectivity to be of huge importance, suggesting 5G coverage should be high on the government’s priority list – especially if increased speeds alone could add £17bn to UK output by 2024.

The government is by no means sitting idly on its hands, intending for Britain to reign supreme in terms of 5G coverage and superfast connectivity – a fact reiterated alongside its released statistics.

There’s a Connection Voucher scheme and chancellor Philip Hammond’s Autumn Statement-announced £1bn infrastructure investment, not to mention a 100 per cent business rates relief for a period of five years to those rolling out fibre cables. So expectations for 95 per cent of Brits to have access to superfast broadband by December 2017 looks set to be met.

We’re thus heading down the right track to make the most of the 2020 smart device boom, right? It’s a question we asked Dave Millett, director of Equinox Communication – and he believes the figure is misleading.

“The 95 per cent only applies to properties/premises,” he said. “Because BT Openreach targeted rollout to residential areas this means large swathes of businesses, notably in city centres and business parks, have no access to fibre broadband at all.”

Another issue lies in the government’s definition of superfast – download speeds in excess of 24Mbps. Other countries consider superfast to be 100 or 220Mpbs, Millett explained.

“In that regard, we rank bottom of Europe as only two per cent of Brits are privy to what is deemed ‘ultrafast’ connectivity (300Mbps+). In contrast Lithuania has 45 per cent coverage.

“We are way behind the likes of the US, Canada and Japan, even Eastern Europe and other growth countries. In fact, we are 54th in world for 4G coverage, trailing Jordan, Kazakhstan and Macedonia on Fibre To The Premises (FTTP).”

We don’t seem to be doing much better on the 5G coverage front, as Millett explained that currently there is no “genuine ambition” to see its domination claims met.

“The UK is a long way behind other countries,” he said. “Japan and South Korea are expecting to have 5G operating in 2020. Japan intends to have it in time for the Olympics. The Conservative manifesto proposed to hand the majority 5G coverage by 2027, which emphasises a lack of ambition.

“The government’s 5G coverage endeavour also requires more investment which is not forthcoming. It may have re-announced £400m as if it was additional money, but it was a sum announced in the last budget.

“Likewise, government spending is behind other countries. For example, South Korea is spending $1.6bn on getting 5G in place.”

It doesn’t help matters that the UK telecoms space has been charged with misleading clients – and has led to doubts among SMEs and home owners alike.

Read on to find out what type of disruption could accelerate the government’s plans.

Take, for example, the Advertising Standards Authority’s (ASA) consultation on broadband advertisements – a reaction to a lack of transparency around speed claims. The move will do little, however, to alleviate the negative reputation the telecoms sector is starting to be painted with.

There are just too many sharks exploiting the unwary with dodgy deals,” Millett said, “and insufficient protection particularly for SMEs with more than ten employees. SMEs with ten or fewer employees and domestic customers can get support from the Ombudsman Services.

“Providers seem to be collectively resisting change that would benefit customers. Why can we roam for free in Europe but not in the UK? Mobile operators resisted government proposals for this. Also look at the money and effort thrown at stopping the separation of Openreach. There appears to be too much self-interest.”

Ofcom has started to level more stringent fines against companies for a range of factors – misleading sales tactics, poor customer service, incorrect billing – but in Millett’s view, it does not go far enough in retaining British business.

Bosses only have so much patience – continually bad service, unexpected cost add-ons and slow internet speed will make them look for a different place to set up shop. There are ways to reinvigorate the industry though.

“My advice to the the ASA is to require suppliers to publish more information on the average speeds customers get, not just what some of them get. Ofcom statistics on complaints per 100,000 on residential focused adverts should be included. How can Plusnet adverts continually quote having great customer service while invariably topping Ofcom’s complaints list?

“The problem the ASA faces is that residential broadband has been price obsessed, which leads to a race to the bottom with no focus on quality of service. Hence consultation is aimed a lot at pricing clarity. To help redress that the ASA should be looking at other factors such as when suppliers give out free routers are they of sufficient quality. Look at all the issues around hacked routers and losses of customer data.”

Another method is to, as was emphasised by Millett, keep pace with trends and change. Much has been said about Verizon keeping close to Yahoo, which has led many to ponder whether, in the future, telecoms and media will be difficult to tell apart. BT certainly seems to be paving the way with its TV rights.

And various disruptions could end up driving change in telecommunications for the better in the next few years.

“Most of the major industry disruptors such as Uber, Airbnb etc. have targeted the consumer space,” Millett explained. “It is harder to do that in the business space where companies have large legacy systems and investments in place. WhatsApp has hit mobile operators revenues to a degree but as roaming costs are removed the need for that disappears.

“As 4G rolls out and the consistent availability of free public WiFi becomes common you will see businesses decide: do I have a mobile focused strategy – hopefully reliant on 5G coverage – or do I use applications (extensions of phone systems) to put landline numbers on mobiles.

“In this instance you would just buy data sims. This may be something the financial services industry will be looking at with MIFID II requiring calls to be recorded, which is harder on mobiles.

“ISDN is due to be turned off in 2025 so over the next few years we’ll see the drive towards SIP and VoIP but these both need decent internet connections.”


 
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