Huawei commissioned report warns of dire consequences of UK 5G delay

A new report estimates the UK could miss £ 108 billion in economic benefits and 350,000 new jobs due to a three-year delay in the rollout of 5G in the country.

The report, titled ‘Regional and consumer impact of delayed 5G rollout’, is the second installment of research conducted for Huawei by London-based independent research firm Assembly Research. In their previous report, “Macroeconomic impact of a delayed 5G rollout in the UK,” analysts estimated that a three-year delay in the rollout of 5G in the country resulted from the Huawei ban, could cost the UK £ 18.2 billion and its 5G. leadership aspiration.

In this follow-up report, analysts have broken down the macroeconomic impact at the regional and municipal levels and quantified what would be at stake if the 5G rollout was delayed as planned. The analysis assumed that the delay would affect the North East and North West of England the most, the Midlands and rural areas in general, as operators would prioritize London and the South East where they could s ‘expect a higher return.

As a result, consumers and businesses in places most likely to be depersonalized by carriers would have the most to lose, widening the already existing digital divide in the country. To quantify it, the authors estimated that £ 108 billion and 350,000 new jobs, out of the £ 173 billion and 605,000 jobs 5G is expected to generate in the UK, may not materialize.

According to the report, such a scenario would run counter to the government’s promise to “level” the economy. It is a definite success and potentially a useful tool to change the government’s mind. Boris Johnson won the last general election in a landslide, knocking down Labor’s so-called red wall in northern England, in large part on the ‘leveling’ promise that a Conservative government would strive to rebalance the economy of the country away from London and the South East.

Not surprisingly, research projects and reports commissioned by companies more often than not lead to conclusions that support sponsors’ agendas. Nevertheless, a few points of this report deserve to be highlighted.

The authors have been cautious enough to provide many caveats at their conclusion. They clarified that they were calculating the “potential total benefit of 5G for different regions of the UK. It is about showing what is at stake for the different regions, it is not an estimate of what they will miss. The methodology described by the authors at the end of the report is legitimate but crude. They used a top-down approach to distribute benefits (monetary and employment opportunities) among regions and cities based on regional and urban GDP (published by the Office of National Statistics in 2017). According to the authors themselves, “the real distribution of jobs may not follow the model of the GDP”.

The starting premise for the “three-year delay” is taken from Oliver Dowden, the Secretary of Digital, Culture, Media and Sports’ statement on telecommunications in Parliament, delivered in July of this year. When assessing the impact of the decision to ban Huawei from 5G in the UK, Dowden said that “this means a cumulative delay

in 5G deployment of two to three years and costs of up to to two billion pounds. ” The authors therefore took the worst-case scenario (three-year period) as the base scenario. Meanwhile, when calculating the economic and business contributions that 5G could generate, the authors decided to find the best scenario numbers, citing studies commissioned by Qualcomm and Huawei.

It would be interesting if the authors could also look at alternative scenarios that might arise in the UK. The United States and Japan have not used Huawei in their 5G networks but have not experienced a three-year delay in its deployment. The authors cited Telia Finland as a success case for 5G-based FWA, but this operator has never had Huawei equipment in its networks either.

The UK’s potential delay is said to come more from removing existing Huawei equipment than not using Huawei in the future. When it comes to calculating the benefits of 5G, not all parties would agree with the estimate of billions of billions of added value promoted by companies with a keen interest in 5G. Gartner, for example, believed 5G was already at its peak. The full versions of the two reports commissioned by Huawei are available here and here. OLTNEWS