Mobile technologies and services contributed over $750 billion or about 5 percent of European GDP in 2021, but Europe’s ambitious Digital Decade goals may fall short due to slower 5G rollout compared to other global markets, according to the GSMA. In its new report, The Mobile Economy Europe 2022, the global mobile industry association shows that at the end of June 2022, 108 mobile network operators in 34 markets across Europe had launched commercial 5G services. Today, six percent of all European mobile consumers can use 5G. Norway has the highest 5G adoption rate at 16 percent followed by Switzerland, Finland, the U.K., and Germany which are all above 10 percent.
The report predicts that by 2025, 5G adoption across Europe will reach 44 percent of all wireless connections, with the U.K. and Germany having the highest rates at 61 percent and 59 percent, respectively. 4G is still expected to account for 52 percent of all European mobile connections in 2025. In that time period, the overall mobile industry contribution to GDP is expected to reach about $830 billion. That rapid growth is outpaced by other world economies, however, as tough market conditions are leaving Europe trailing its global peers. By comparison, 5G adoption in South Korea is expected to hit 73 percent by 2025, while Japan and the U.S. are likely to reach 68 percent.
Meeting EC Digital Decade Goals
How fast 5G coverage is expanded across Europe to transition from 4G to 5G is an important step towards achieving the continent’s digitalization goals. In 2021, the European Commission (EC) laid out its 2030 vision for Europe’s digital transformation in its “Digital Decade” framework. The strategy promised to deliver tangible benefits for EU economies through the development of digital skills, digital transformation of business, sustainable digital infrastructures, and the digitalization of public services.
Although 5G network coverage in Europe will rise to 70 percent in 2025 (from 47 percent in 2021), nearly a third of the population will remain without access to 5G. This compares to roughly two percent in South Korea and the U.S. European MNOs are expected to invest an aggregate of over $120 billion in network infrastructure between 2022 and 2025 to reach that coverage level.
As economies digitalize, accelerating 5G deployment is key for European traditional industry and manufacturing to remain competitive. GSMA emphasizes that to meet the EC’s 2030 goals, it is imperative for policymakers to create the right conditions for private infrastructure investment, network modernization and digital innovation, through proactive regulatory and economic incentives.
Daniel Pataki, GSMA Vice President for Policy & Regulation, and Head of Europe, said, “Europe is adopting 5G faster than ever before, but greater focus on creating the right market conditions for infrastructure investment is needed to keep pace with other world markets. This should include the implementation of the principle of fair contribution to network costs.”
The report also examines how European MNOs are progressing with the rollout of 5G standalone networks, noting that 5G SA services in Europe are now available in Finland, Germany, and Italy. Further deployments are expected in the next few years. The added functionality enabled by 5G SA is key to supporting advanced use cases in business, industry and government that can take advantage of 5G’s high data throughput, low latency characteristics.
Of note, European operators are ahead in adopting energy-efficient technologies, as Inside Towers reported. Many MNOs are already reaching 100 percent renewable electricity use across their footprints, for powering their network infrastructure, data centers and other sites.
By John Celentano, Inside Towers Business Editor