Barcelona: The European Union's slow adoption of 5G networks and lagging performance compared to other regions is lamented by both telecoms operators and industrial firms hoping to build on improved connectivity.
Operators at the Mobile World Congress in Barcelona were on Monday calling for the European Commission to do more to back the high-speed mobile internet technology.
How big is 5G in Europe?
The GSMA global telecom industry body says that around 30 percent of European mobile connections were via 5G by the end of 2024.
That is higher than the global average at 24 percent, but far short of the 60-percent rate in North America or the more than 50 percent levels seen in many East Asian countries.
"The gap is even more pronounced in terms of performance: in South Korea, the average 5G speed is around 400 Mbps (megabits per second), while in Europe, it is roughly half that," said Dario Betti, head of the Mobile Ecosystem Forum, another sector body.
Some European countries are further along with 5G adoption, like Denmark at 40 percent or Germany at 50.
But the continent that led the way in rolling out 2G mobile networks in the early 1990s "continues to lag behind other regions", said GSMA regulation chief John Giusti.
What's holding Europe back?
Analysts and companies say the main brake on 5G in Europe is the continent's massively fragmented telecoms market.
"In China, there are three big operators, the same in the US. In Europe there are several hundred, and that's a problem because 5G requires major investments" that can't be stemmed by small players, said Thomas Husson, an analyst at consultancy Forrester.
What's more, some countries' decision to exclude Chinese network hardware makers Huawei and ZTE over security concerns has had an impact, Betti said.
Operators have had to remove the manufacturers' devices from their networks and "turn to alternative suppliers such as Nokia and Ericsson, often facing higher costs and potential deployment delays," he added.
Lack of enthusiasm among consumers and some businesses for 5G since its 2020 launch is also a factor.
Without strong demand, "operators are struggling to make a return" on their investments, Husson said.
Why does it matter?
European operators also facing higher energy bills are struggling to fit costly 5G investment into their financial plans.
Marc Murtra, boss of Spanish giant Telefonica, said Monday that "over-regulation and insufficient industry returns" had "weighed Europe down into falling behind technologically".
Manufacturers of hardware like antennas and other network infrastructure suffer the knock-on effects of operators' financial woes.
And industrial firms are not getting access to the hoped-for benefits of 5G, including automating production processes, augmented-reality applications or data for predictive maintenance supposed to reduce breakdowns of machines and electronics.
With some competitors already eyeing 6G, the next generation of mobile broadband offering even higher speeds, Europe's handicap has "important implications", Betti said, calling it "the symptom of a far more serious weakness in Europe's digital infrastructure".
Can Europe catch up?
The GSMA expects 5G to account for more than half of European mobile connections in 2026 and 80 percent by 2030.
But the outlook is less clear for 5G+, a "standalone" version of the technology independent of older 4G networks.
Telecoms firms hope the emergence of artificial intelligence applications requiring robust networks will prove to be a wake-up call, pushing Brussels to loosen regulatory constraints on operators.
The bloc "is at a crossroads", the GSMA's Giusti said.
"Urgent action" is needed from the European Commission, he added, especially "completing the Digital Single Market to allow the mobile industry to develop and deploy services on a cross-border or pan-EU basis".
"It is time for large European telcos to be allowed to consolidate and grow to create technological capacity," Telefonica's Murtra said.
