/PRNewswire/ — European mobile operators could unlock billions in potential infrastructure investments, accelerate standalone 5G (5G SA) deployments and boost the continent’s economic output, if policymakers take a smarter approach to spectrum policy, according to a new GSMA study.
The report, Spectrum pricing and renewals in Europewritten by GSMA Intelligence, explains how Europe’s long-standing approach to spectrum pricing has contributed to the investment pressures facing the mobile sector today. The analysis shows that total spectrum costs have increased significantly over the past ten years, now representing 8% of mobile operators’ recurring revenues.
The results come as Europe faces growing pressure to catch up with its global counterparts. Only 2% of Europeans use 5G SA services today, compared to 77% in China and around a quarter in the United States. With the Digital Networks Act in place, Europe has an opportunity to change course.
More than 500 spectrum licenses are up for renewal over the next ten years. These licenses are essential for existing coverage and services, as they broadly cover the 3G and 4G networks that continue to provide Europe’s 470 million mobile internet users, and could be a major lever to unlock fundamental investments.
Under existing policies and at current prices, operators are expected to face spectrum costs of €105 billion until 2035. Reforming renewal approaches could reduce this amount by €30 billion.
These savings could potentially cover the work needed to upgrade all existing 5G networks to 5G SA, increasing speeds by up to 23% and generating up to €75 billion in additional GDP over the next ten years.
But achieving these savings will require policy reform and a unified European approach to licensing and renewal.
John Giusti, Head of Regulation at the GSMA, comments: “Providing high-quality connectivity to European citizens and improving the continent’s competitiveness requires considerable investment that many operators struggle to find or justify. Smart reform of spectrum policy in Europe will have an immediate and lasting impact.
In particular, renewal costs are a clear opportunity to be smarter about how industry money is allocated. Rather than continuing to use spectrum as a windfall, policymakers should be more ambitious in their approach to renewals and allow these funds to be used to support Europe’s current digital goals.
To find out more, read here.
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