The European Commission (EC) has published the results of a study that identifies and quantifies the key socio-economic benefits of 5G.
The study was launched in May 2015 and was undertaken by a consortium of Interdigital Europe, Real Wireless, Tech4i2 and Trinity College Dublin, on the EC’s behalf. The study served as an input into the EC’s 5G Action Plan, announced in the recent State of the Union address.
Previous research into 5G has focused on the technical and technology aspects of 5G, but this study investigated what 5G might mean for users, industries, operators and other stakeholders, too consider the economic, social and environmental benefits for society as a whole.
The EU28 member countries are expected to invest a total of €56.6b in 5G by 2020, which will generate an annual total of €113.1b in total socio-economic benefits in 2025, comprising €62.5b in ‘first order benefits’ and €50.6b in ‘second order impacts’. The multiplier effect of 5G is expected to create – directly and indirectly – nearly 2.4m jobs across the EU.
The study focused on four verticals that are likely to be at the forefront of 5G takeup: automotive, healthcare, transport and utilities. The first order benefits across these verticals are the direct benefits to the producers of goods and services. Unsurprisingly, automotive is by far the strongest category, expected to generate benefits of €42.2b in 2025, which surpasses the other verticals by a long margin: healthcare (€8.3b), utilities (€6.5b) and transport (€5.5b).
The second order benefits are the knock-on impacts from the use of goods and services, ie the indirect benefits to society. The study considered four different environments that will be impacted by 5G: smart cities, non-urban areas, smart homes and smart workplaces. Here, the biggest impact will be in the workplace, with €30.6b in indirect benefits, spread almost equally between increased productivity and reduced waste. Interestingly, the non-urban sector is expected to benefit more from 5G than smart cities, with €10.5b in indirect benefits, largely from lower broadband costs and the resulting access to online purchasing. A reduction in congestion and the number of accidents will be the main contributor to the €8.1b in indirect benefits in smart cities. Smart homes will realise just €1.3b in second order benefits.
The UK will be the second largest contributor to 5G investment after Germany, with a spend of €7.04b by 2020, equivalent to 12.4% of the total. It will realise €16.52b in total benefits (11.7% of the total), after Germany and France. However, in terms of jobs, it comes far down the list with just 7.2% of the total (172,000 jobs), behind Germany and France but also the likes of Poland, Spain and Romania which are expected to be the biggest beneficiaries.