Europe Lags US on 5G Readiness but Could Lead

There's strong competition among European telcos, equipment makers and regulators and governments, but the bigger picture shows Europe is behind the U.S. in 5G rollout. It's not too late, however, for Europe to take the lead, said GSMA Head of Spectrum Brett Tarnutzer in an interview. One problem is that there's less access to spectrum to support 5G, he said. Europe hasn't completely cleared the 700 MHz band, which the U.S. did some time ago, he said. Mexico will be the first to open the 600 MHz band to mobile broadband, even ahead of the U.S., but that spectrum won't be given to the European mobile industry until at least 2023. In the U.S., the Citizens Broadband Radio System in the 3.5 GHz band is moving forward, as is the 3.7-4.2 GHz band (C-band), he said. The U.S. sold licenses in mmWave bands and announced a November auction for 24 GHz and 28 GHz spectrum, he noted.

The U.S. also has favorable license terms, Tarnutzer said: They're long term, with expectations of renewal, offering potential investors certainty. Europe, however, only now is mulling longer license terms in the context of its telecom reform package, he said.

Europe is trying to negotiate the legal foundation of its "5G house," said GSMA Public Policy Manager Daniel Gueorguiev. The European Commission's initial objective was to come up with a future-proof regulation, which it's still in the process of finalizing, he said. But the current text is quite detailed and prescriptive and strayed from its original focus, he said.

Digital and spectrum issues, which were at the top of the EC agenda several years ago, have now been pushed down the priority list by matters such as global migration and Brexit, said Gueorguiev. A further concern for mobile operators is that Europe is taking a long time to "defragment" the C-band, which has incumbent users and is seriously discontinuous from one country to another, he said. In addition, Europe is behind the U.S. in base station licensing and siting policies, a key concern since the EU has 28 different national regimes plus many local ones, he said. The FCC has already voted on rules for small-cell siting and other infrastructure matters, but Europe is just starting to consider the matter.

"Europe has one of the world's most elaborate regulatory frameworks, which has produced great competition and very low prices but hasn't been able to create the necessary scale and timely investments in new networks that we've seen in other regions, particularly with the advent of 4G," emailed a DigitalEurope spokesman. The situation will be largely the same for 5G, at least for rolling out "enhanced mobile broadband," he said.

But the game isn't lost, those we spoke with said. Europe does lead on some 5G technological issues in mmWave frequencies, said Tarnutzer. European mobile operators, for example, will probably have around 1 GHz to use in the 26 GHz band, giving them more available frequencies while shielding incumbent earth exploration satellite services (EESS) from harmful interference, he said. Discussion is taking place on how to set emissions limits to protect EESS (passive) below 24 GHz, Tarnutzer said. The higher the limits, the less use mobile operators can make of the lower part of the band; but they'll be able to use the upper part, he said.

Where Europe can lead is in the approach to vertical use cases for 5G, provided there's enough harmonization across European countries, said the DigitalEurope spokesman. But EU regulators will have to work together "or we'll only see fragmentation and delays." European leaders have consistently pushed for 5G leadership and there's no shortage of political willingness to be first, said Gueorguiev. But in the trenches where the real work is being done -- on interference emissions limits or the C-band, for instance -- there's a gap between what politicians say and what's happening on the ground, he said.

Fifth generation is a top priority for European telecom regulators, the Body of Regulators for Electronic Communications said after its March 7-9 plenary meeting. It presented a study showing that finding 5G use cases will be a step-by-step process, with many potential uses now at very early stages of development. Rollout of 5G could bring many enhancements over 4G as well as new business models for network operators and entry for players upstream of operators, it said.

But despite the transformative possibilities of 5G in the long run, most stakeholders now believe the first deployments will be driven by enhanced mobile broadband, which might not, on its own, create significant additional revenue from 5G for mobile operators, the BEREC report said. Future incentives depend on incremental revenue from new services, but such incentives will need sufficient 5G coverage, which creates a coordination issue, it said. Nor is there any killer application such as transport, medical applications or the IoT, it said. Rather, the technology is more likely to have a large number of niche applications across many sectors, but "there is a challenge in identifying these various likely demands for 5G and creating services and pricing arrangements targeted at those uses."

CEPT is seeking feedback on draft rules to harmonize the 3.4-3.8 GHz and 26 GHz bands for 5G. The consultation documents are here. The "milestone" paves the way for 5G spectrum regulation in Europe, the Electronic Communications Committee said. The rules, intended to speed 5G rollout in Europe, are expected to be adopted in July, said ECC Chairman Eric Fournier.