COMMISSION STAFF WORKING DOCUMENT 5G Global Developments Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS 5G for Europe: An Action Plan
Date: 2016-09-14
Institutions: Directorate-General for Communications Networks, Content and Technology, European Commission
Subjects: EU programme, Internet, digital technology, information technology, information technology industry, innovation, mobile phone, new technology, single market, transmission network

EN 

   EN 

   EUROPEAN COMMISSION  Brussels, 14.9.2016  SWD(2016) 306 final   COMMISSION STAFF WORKING DOCUMENT 5G Global Developments Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS 5G for Europe: An Action Plan {COM(2016) 588 final}  
 
 
STAFF WORKING DOCUMENT 

5G Global Developments 

Table of contents 

1.  Preamble ...................................................................................................................... 3 

2. 

5G Early Context ......................................................................................................... 3 

3.  What is 5G? ................................................................................................................. 4 

4.  Migration and co-existence aspects ............................................................................. 8 

5. 

5G opportunities ........................................................................................................ 12 

6.  Coordinated market deployment, learning our lessons from 4G .............................. 14 

7.  Radio Spectrum Issues .............................................................................................. 16 

8.  Trials and early roll out ............................................................................................. 18 

9.  Standards ................................................................................................................... 20 

10.  Investments Issues ..................................................................................................... 22 

11.  Conclusions ............................................................................................................... 24 

Annex: 5G Targeted Survey, Summary Figures ............................................................... 25 

2 

 
 
 
 
 
 
 
 
1.  Preamble 

This Staff Working Document presents a short summary of 5G developments worldwide and 
of the main issues currently at stake which impact the anticipated deployment of 5G networks. 
It  accompanies  the  Communication  "5G  for  Europe:  An  Action  Plan"  with  the  aim  of 
providing background information explaining the context within which the 5G Action Plan is 
being presented by the European Commission. 

It draws on multiple consultations, events1 with stakeholders, several studies2, numerous input 
from  Industry3,  early  results4  of  the  5G-PPP  and  the  results  obtained  through  a  targeted 
consultation that took place from 13 June 2016 to 11 July 20165. 

2.  5G Early Context 

Public  reflections  on  a  new  generation  of  5G  communications  technologies  started  in  2011, 
based on the prospects for new markets, new usages and advanced technologies which could 
not  be  considered  during  the  time  frame  of  development  of  the  4G/LTE  standards  (current 
generation of mobile communications systems)previous generation (4G). 

This triggered European 5G related R&D projects under the EU 7th Framework Programme, 
which  acted  as  technological  pathfinders  for  the  core  5G  technological  options6.  The  5G 
Public  Private  Partnership  (5G  PPP)  was  then  created  in  2013  under  the  Horizon  2020 
Research  &  Innovation  programme  by  the  European  Commission  with  the  objective  of 
fostering European 5G industrial leadership. Today, the 5G PPP implements a set of strategic 
industry-led  projects7  with  a  total  of  166  stakeholders.  An  EU  funding  of  €700  million  is 
planned for the initiative, leveraging at least €3.5 billion from the private sector between 2014 
and 2020.  

At  the  global  level,  several  prominent  5G  industrial  public  private  partnerships  have  been 
launched  between  2013  and  2015  involving  leading  operators,  vendors,  universities,  and 
research institutes in the field of mobile communications:  

-  The  IMT-2020  (5G)  Promotion  Group  in  China  (2013),  the  major  platform  to 

promote the research of 5G in China including deployment aspects.  

-  The 5G Forum in the Republic of Korea (2013), with a budget of $ 1.4 billion (2/3rd 
private,  1/3rd  public),  leading  work  on  technologies  and  infrastructures  for  early  5G 
deployment in Korea in 2018 at the winter Olympic games.  

-  The  5G  Mobile  Communication  Promotion  Forum  (5G  MF)  in  Japan  (2014),  a 
promotional organization for R&D and standardization collaborative activities. It leads 

1   See: e.g. https://5g-ppp.eu/event-calendar/ 
2    See footnotes 4 and 5 above. 
3    Notably the 5G Manifesto for timely deployment of 5G in Europe, 7 July 2016: 

http://ec.europa.eu/newsroom/dae/document.cfm?action=display&doc_id=16579;  

4    White paper "5G Empowering Vertical Industries": https://5g-ppp.eu/roadmaps/ 
5  https://ec.europa.eu/digital-single-market/en/news/targeted-consultation-co-ordinated-introduction-5g-

networks-europe 
Please see respondent profile in annex. It is planned to publish shortly a public summary report of the results 
of the targeted consultation. 

6   https://5g-ppp.eu/projects/ 
7   <web link Cordis to list of projects H2020> 

3 

 
 
                                                 
the  preparation  of  the  5G  deployments  in  Japan  for  the  Tokyo  Olympic  Games  of 
2020.  

-  Furthermore, in 2015 the 5G Americas industry association was reshaped to focus on 

industry preparation towards 5G migration in the US and in South America.  

These  activities  with  governmental  support  have  generated  a  global  momentum,  which  has 
significantly accelerated the pace of 5G developments over the last 18 months. In that context, 
the  European  Commission  DG  CONNECT  has    signed  Joint  Declarations  of  co-operation 
with its counterparts in South Korea, Japan, China and Brazil to foster alignment of 5G global 
visions  and approaches towards standards and radio  spectrum8. A closer cooperation is  also 
being established with key US organisations. 

3.  What is 5G? 

The concept of very high performance  5G networks results from a combination of different 
factors.  

From the service and business perspective: 

-  A significant increase in mobile video consumption will drive around six times higher 
traffic volumes per device in North America and Europe after 2020. The popularization 
of  cloud-delivered  Media  and  Social  Media  content  to  smart  devices  puts  additional 
constraints on the intermediate communication links, whilst ever richer content calls for 
significant capacity increase. Virtual reality applications are expected to require gigabit/s 
capability  whilst  the  generalization  of  8K  Ultra  High  Definition  Televisions9  and 
UHDTV streaming should require capacities of more than 100Mb/s for a single user.  

From  the  5G  perspective,  the  corresponding  services  are  called  "enhanced  Mobile 
Broadband", also referred to as eMBB in the following text, and target applications with 
aggregated speeds higher than 10 Gb/s. 

-  The advent of Machine to Machine communication, with large numbers of connected 
devices (massive IoT)  used  in  professional and industrial applications  or in  smart  cities 
deploying large populations of sensors, calls for highly efficient radio networks and very 
low energy consumption.  

From  the  5G  perspective,  the  corresponding  services  are  called  "massive  Machine  to 
Machine  Communication",  also  refered  to  as  mMTC  in  the  following  text,  and  target 
applications with millions of devices/km². 

-  New time-demanding applications requiring instant reaction, i.e. very low latency in the 
order of 1ms, cannot be served by today's existing technology with the required guarantee 
of  performance10.  Typical  applications  include  remote  surgery,  connected  cars  (mainly 
for  safety  services  and  fast  prediction  of  surrounding  conditions),  smart  factories  and 
robotics,  or  detection  of  faults  in  energy  grids.  These  time  critical  applications  will,  in 
most cases, have to combine 5G connectivity with distributed (mobile) cloud technology 
in order to meet the required end-to-end response times. 

8 https://ec.europa.eu/digital-single-market/en/5G-international-cooperation 

9   8K refers to the number of "pixels" (picture elements) with 4 times better horizontal and vertical definition of 

an image compared to traditional High Definition TV standards (2K pixels for  horizontal definition) 

10   Typical LTE latency is today at about 10ms. 

4 

 
 
                                                 
From  the  5G  perspective,  the  corresponding  services  are  called  "Ultra  Reliable  Low 
Latency" also refered to as URLL in the following text, and target applications with very 
low latency requirements. 

From the technological perspective: 

Several disruptive technologies are expected to act as game changers:  

-  The prospect of economic fibre-like radio access with data rates beyond 10 Gb/s is 
within reach, notably through the usage of higher frequency bands above 6 GHz and 
related technologies. Today, spectrum allocations for wireless broadband are situated 
below  6GHz.  Higher  frequency  bands  will  offer  larger  capacities  for  disruptive 
large  number  of  simultaneous  communications  with 
capabilities,  such  as  a 
users/devices,  and  open  the  prospect  for  user  data  rates  meeting  the  International 
Telecommunication  Union  (ITU)  requirements  for  5G  (i.e.  exceeding  10  Gb/s). 
Multiple trials performed by industry in 2016 showed that speeds higher than 10 Gb/s 
and up to 70 Gb/s can be achieved using spectrum above 6 GHz. A vast majority of 
vendors and operators aim at using spectrum around 30 GHz (25-32 GHz) for early 5G 
trials  at  high speeds, where commercial implementation  may be  feasible in  the short 
term.  

-  Network  Function  Virtualisation  (NFV)  offers  the  prospect  of  implementing 
specific  network  functions  (e.g.  Content  Delivery  Network,  Customer  Premises 
Equipment  management  etc.)  in  software  running  on  generic  hardware,  without  the 
need  for  costly  hardware-specific  machines.  The  expected  impacts  are  i)  a  drastic 
reduction in capital expenditure (capex) and network management costs – operational 
expenditure  (opex);  ii)  reuse  and  sharing  of  the  same  functionality  between  several 
customers; iii) higher innovation capability through easy introduction of new software 
functionalities  and  creation  of  a  "network  app"  market  place.  The  trend  towards 
virtualisation is profound in the industry. For instance, Telefonica plans to virtualise at 
least  30%  of  its  network  in  the  short  term;  AT&T  plans  to  virtualise  75%  of  its 
network  by  2020  to  cope  with  mobile  traffic  explosion.  More  than  250  companies 
support the ETSI-NFV Industry Specification Group (ISG) which is one of the leading 
bodies for NFV functional specifications.  

-  Software Defined Networking (SDN) is a complementary trend to NFV that allows 
the control of network resources to be opened to third parties, with the possibility for 
these  third  parties  to  manage  their  own  physical  or  virtual  resources  individually,  as 
needed,  with  the  required  level  of  performance  tailored  to  actual  needs.  This 
possibility  goes  much  beyond  the  management  capabilities  offered  to  today's 
MVNO's11. 

In the context of 5G developments, and in view of supporting ad-hoc digital business 
models of industrial users, SDN and NFV are seen as key components to enable these 
specific  categories  of  professional  users  to  control  their  network  capabilities 
dynamically according to their needs. As network resources are potentially available to 
third parties through open interfaces, they also open the possibility for smaller players 

11  A  Mobile  Virtual  Network  Operator  operates  resources  contracted  from  a  network  operator  owning 
physical and logical network infrastructure.  

5 

 
 
                                                 
to  innovate  through  development  of  specific  service  offers  building  on  network 
resources made available for third party access and programmability.  

The  core  capabilities  outlined  above  go  much  beyond  the  current  and  future  4G/LTE 
capabilities in the following ways:  

-  Speed:  Today,  4G  data  rates  (accessible  to  multiple  users)  are  at  about  500  Mb/s, 
which  enables  in  average  a  maximum  data  rate  of  50  Mb/s  per  user.  Evolution 
scenarios  contemplated  by  standardisation  organisations  like  3G  PP12  target  a 
maximum capability for 4G up to 3Gb/s13. 

-  Flexibility  to  accommodate  demanding  professional-grade  applications:  4G  core 
network  architectures  and  capability  do  not  widely  implement  SDN/NFV  based 
functions.  This  does  not  allow  the  resource  allocation  flexibility  that  is  needed  in 
scenarios  where  a  radio  access  has  to  serve  applications  with  very  different 
requirements  (e.g.  connected  vehicle  users  with  very  low  latency  requirements  or 
video streaming users with very high downlink speed requirements). The lack of open  
interfaces  also  pre-empts  the  emergence  of  innovative  service  offers  in  the  new 
domains. 

- 

Instant response time: Core 5G application requirements such as low latency of 1ms 
(10 to 20 ms for 4G), serving 1 million devices/km² (about 1000 device/km² for 4G) or 
fast deployment of new services in the order of 1 hour deployment time (measured in 
days with current technology) are not part of today's 4G technology.  

Against this background, 5G definition and use cases have been developed by industry.  The 
ITU  recommendation  ITU-R M.2083-0,  approved  in  September  2015,  defines  the  overall 
objectives  of  the  future  development  of  IMT  for  2020  and  beyond.  It  calls  for  5G  system 
improvements  that  cover  three  generic  classes  of  services,  based  on  anticipated  market 
developments. These are outlined in the "ITU triangle" below: 

12  3G  partnership  Project,  the  lead  global  standardisation  body  for  mobile  Communications  created  in  the 
late 90s to address 3G Global standards 
13 LTE-A-PRO version 

6 

 
 
 
                                                 
The  ITU  Vision  document  also  characterises  the  increased  performance  level  needed  to 
achieve the 5G (IMT 2020) vision, as outlined in the figure below (IMT advanced refers to 
4G) 

The 5G PPP Vision document summarises well these objectives (extract below):  

"5G  will  not  only  be  an  evolution  of  mobile  broadband  networks.  It  will  bring  new  unique 
network  and  service  capabilities.  Firstly,  it  will  ensure  user  experience  continuity  in 
challenging situations such as high mobility (e.g. in trains), very dense or sparsely populated 
areas,  and  journeys  covered  by  heterogeneous  technologies.  In  addition,  5G  will  be  a  key 
enabler  for  the  Internet  of  Things  by  providing  a  platform  to  connect  a  massive  number  of 
sensors, rendering devices and actuators with stringent energy and transmission constraints. 
Furthermore, mission critical services requiring very high reliability, global coverage and/or 
very low latency, which are up to now handled by specific networks, typically public safety, 
will  become  natively  supported  by  the  5G  infrastructure.  5G  will  integrate  networking, 
computing  and  storage  resources  into  one  programmable  and  unified  infrastructure14.  This 
unification will allow for an optimized and more dynamic usage of all distributed resources, 
and  the  convergence  of  fixed,  mobile  and  broadcast  services.  In  addition,  5G  will  support 
multi tenancy models, enabling operators and other players to collaborate in new ways." 

Similar  considerations  can  be  found  in  other  industry  publications,  e.g.  the  white  paper 
developed by the Next Generation Mobile Network Alliance (NGMN)15.  

Relevant results of the targeted survey: 

There  is  a  widely  shared  understanding  that  5G  will  be  of  a  disruptive  nature,  a  key 
infrastructure  for  Europe  and  a  core  asset  to  support  competitiveness.  This  view  is 
expressed by about 70% of respondents, and opposed by only 10%. In the same context, 63% 
of the respondents agreed with the view that 5G will be a strategic infrastructure in Europe 
for  the  telecom  industry,  the  industries  that  use  connectivity  and  society  in  general.  These 
views  are  well  shared  across  all  categories  of  respondents,  with  some  marginal 
disagreements. 

14   This does not refer to a single physical infrastructure, nor to a single ownership structure. 
15   NGMN 5G White Paper (2015): 

http://www.ngmn.org/fileadmin/ngmn/content/images/news/ngmn_news/NGMN_5G_White_Paper_V1_0.pdf 

7 

 
 
 
                                                 
4.  Migration and co-existence aspects 

Evolution  from  4G:  within  the  overall  5G  development  time  frame,  it  is  important  to  note 
that  4G  will  continue  to  be  developed  and  enhanced,  and  also  to  be  deployed.  5G  is  not 
conceived as a technology replacing 4G, but  rather enhancing it and complementing  it with 
new service capabilities. At this time, it is considered that the usage of 4G will continue for 
many years, before eventually 5G takes over completely. A valid similarity can be found with 
the current 4G introduction pattern, with 4G ramping up whilst earlier 3G/2G are still in use 
in other frequency bands and still growing globally in the case of 3G.  See example graph of 
technology co-existence below16.  

Therefore, 5G will be designed to co-exist with 4G, and is expected to support the advent of 
multi  technology  operations,  with  terminals  having  the  capability  to  connect  to  the  best 
available  network,  as  a  function  of  the  service  requirements  of  the  application.  Each  radio 
access  being  introduced  in  a  different  frequency  band,  the  terminal  may  eventually 
dynamically select the best radio access for the considered application. This also encapsulates 
the usage of WiFi and unlicensed bands, which should be much more tightly integrated into 
the connectivity offer portfolio of a service provider, and will help to provide "tailor made" 
connectivity  to  users  as  part  of  their  application  requirements.  The  industry  is  currently 
working  on  the  required  functionality  that  makes  this  multi  radio  convergence  possible 
already partially in a 4G/LTE context. This evolutionary perspective is a key aspect to support 
gradual  investments  in  5G,  offering  an  introduction  perspective  designed  to  gradually 
complement the 4G offer. 

Considering that 5G will "piggyback" on 4G and thus enhances it, the deployment of 4G is 
considered as a pre-requisite for a successful introduction of 5G. 4G will ensure the continuity 
of  service  when  and  where  5G  functionalities  are  not  fully  available  in  some  parts  of  the 
infrastructure. This is also reflected by responses to the targeted survey from mobile operators 
stating  that  mobile  operators  are  expected  to  spend  USD  1.7  trillion  worldwide  on  their 

16   GSMA report: Understanding 5G: Perspectives on future technological advancements in mobile 

8 

 
 
 
 
                                                 
network equipment between 2014 and 2020, much of it to upgrading to 4G architecture. That 
is  almost  double  the    USD  878  billion  spent  from  2009  to  2013  at  the  time  when  3G  was 
being built. 

Typical  example  of  a  foreseen  evolution  strategy  towards  5G,  the  case  of  "connected 
vehicles" application: a typical upgrading strategy is being pursued in the area of connected 
vehicles, as outlined below. It is to a large extent also relevant to other specific industry sector 
applications. 

In the case of connected vehicles, it is not envisaged that 5G would simply supersede earlier 
investments in ITS-G517 technology, as currently deployed in Europe and in other regions of 
the world.  This  technology is  based on an evolution  of the  WiFi standard (802.11.P) and is 
recognised as a technology of choice for early ITS deployment in Europe, as outlined in the 
C-ITS platform final report18, targeting primarily road safety services in the first instance. 

The main scenario contemplated for the introduction of 5G functionalities is for the provision 
of  additional  services  compared  to  the  earlier  rolled  out  technologies,  following  a  hybrid 
communication approach.  

As  identified  in  the  C-ITS  platform  report, the main  set  of  agreed  services  is  for the  Day  1 
level, and covers:  

-  Hazardous location notifications:  

o  Slow or stationary vehicle(s) & Traffic ahead warning  

o  Road works warning  

o  Weather conditions  

o  Emergency brake light  

o  Emergency vehicle approaching  

o  Other hazardous notifications  

-  Signage applications:  

o  In-vehicle signage  

o  In-vehicle speed limits  

o  Signal violation / Intersection Safety  

o  Traffic signal priority request by designated vehicles  

o  Green Light Optimal Speed Advisory (GLOSA)  

o  Probe vehicle data  

o  Shockwave Damping (falls under ETSI Category “local hazard warning”) 

In addition, the C-ITS platform of the Commission has already identified a set of "Day 1.5" 
services and is working on higher levels of vehicle automation. 

17 "ITS" is the acronym for Intelligent Transport System. "G5" is a standard for car-to-car communications and 
should not be confused with "5G". 
18   http://ec.europa.eu/transport/themes/its/doc/c-its-platform-final-report-january-2016.pdf 

9 

 
 
                                                 
From a technological point of view the automotive sector works against "Phases"19, each with 
a greater service capability.  

Phase 1 

Generally,  the  Day  1  applications  of  the  C-ITS  platform  can  be  considered  as 
‘awareness  driving’,  e.g.  the  traffic  participants  share  status  information,  to  allow 
others to understand the current status of conditions around them. 

Phase 2 

For the next phase, it is expected that the participants will also share the observations, 
e.g.  the  data  from  their  sensors,  in  addition  to  status  data.  This  can  be  envisaged  to 
allow provision of information about traffic participants that are not themselves able to 
provide  status  information,  e.  g.  because  they  are  not  C-ITS  equipped.  This  second 
phase is often called ‘sensing driving’. 

Phase 3 

Again building on top of the information provided in the first two phases, a third phase 
is  envisaged  to  enable  ‘cooperative  driving’.  To  allow  that,  it  will  be  necessary  to 
share  intentions,  e.  g.  the  participants  will  inform  the  others  about  their  intentions, 
such as lane changes, planned trajectories etc.  

Phase 4 

The  third  phase  will  most  likely  be  followed  by  a  fourth  phase  that  will  allow  the 
participants  to  make  coordinated  actions,  e.  g.,  forming  platoons,  coordinating  lane 
merging etc. This phase is often called ‘synchronised cooperative driving’.  

Phase 5 

The next and major step after the above phases will be moving towards an "accident-
free" driving system, based on automated driving with optimised traffic flows. The 5G 
technology  is  expected  to  play  a  growing  role  in  the  set  of  technologies  (some  of 
which  are  likely to  be  duplicated to  provide  redundancy  and  security)  which  will  be 
required to reach the goals of an "accident free" environment. 

19   http://www.codecs-
project.eu/fileadmin/user_upload/pdfs/D3.1_653339_CODECS_Workshop_Perspectives_
In_Functional_Roadmapping_Summary_V1.0_c.pdf 

10 

 
 
                                                 
The overall evolution is summarised below: 

According to the Car 2 Car consortium20, the use cases for 5G in vehicles are: 

-  Map  update  for  highly  automatic  driving  -  Instantly  update  the  map  of  a  vehicle's 

surrounding. 

-  Precise Positioning - support for vehicles without high precision location tracking like 

cars. 

-  Audio / Video Streaming (Entertainment), Online Gaming. 
-  Sensor and State Map Sharing (Sensor Raw Data) -Transmit raw sensor data such that 

others can use their own classifiers to infer decisions. 

The above 5G introduction scenarios for the automotive sector take into account the view of 
the C-ITS platform report, namely: "… a hybrid communication concept is therefore needed 
in order to take advantage of complementary technologies. It is therefore essential to ensure 
that  C-ITS messages  can  be  transmitted  independently  from  the  underlying  communications 
technology (access-layer agnostic) wherever possible21". 

to 

20   ETSI  5G  Summit,  "From  Myth 

reality",  21  April  2016,  Towards  accident-free  driving, 
https://docbox.etsi.org/Workshop/2016/20160421_5G_FROM_MYTH_TO_REALITY/SESSION_C_MASS
IVE_M2M/TOWARDS_ACCIDENT_FREE_DRIVING_ANDERSEN_CAR_COM_CONSORTIUM.pdf  
21   The  C-ITS  Platform  recommends  that  for  short-range  communications  in  the  5.9  GHz  band  initially  the 
communication  system  to  be  used  is  IEEE802.11p/ETSI  ITS-G5,  and  to  study  whether  geographical 
coverage  obligations  can  be  introduced  to  increase  coverage  of  C-ITS  services  through  existing  cellular 
communications infrastructure, and therefore foster uptake of C-ITS services. 

11 

 
 
 
 
                                                 
5.  5G opportunities 

From  a  market  perspective,  it  is  predicted  that  5G  revenues  may  reach  US$250  billion  in 
2025, with North America, Asia-Pacific, and Western Europe being the top markets22, based 
on  clear  prospects  that  critical  and  massive  "Machine  to  Machine"  communications  will 
generate substantially higher revenues in addition to enhanced Mobile Broadband services. A 
study  carried  out  for  the  Commission23  indicates  that  the  benefits  of  5G  introduction  across 
four  industrial  sectors  may  reach  €113  billion  per  annum.  In  2025  it  is  expected  that  €62.5 
billion will be generated from first order benefits in the four key industrial sectors examined 
in the study. 

Leading  market  actors  also  predict  that  5G  will  already  represent  more  than  150  million 
connections  in  202124  globally,  more  than  the  number  of  current  4G/LTE  subscriptions  in 
Europe (147 million). The study mentioned above, carried out for the European Commission, 
identifies  several  "first  order"  benefits  for  5G  introduction  in  4  sectors:  automotive, 
healthcare, transport, utilities:  

"First order" benefits focus on the more direct benefits to the producers of goods and services.  
These benefits predominantly fall into three categories: 

1. Industries will exploit 5G capabilities to obtain benefits in three key areas of their activity:- 

-  Strategic benefits will arise from greater access to information about the supply chain, 
internal  operations,  market  characteristics  and  consumer  utilisation  of  goods  and 
services. 

-  Operational  benefits  and  enhanced  productivity  will  arise  from  increased  real-time 
access to information about operations (inside/outside the workplaces and throughout 
the supply chain). 

-  Direct User benefits should arise for consumers from access to ‘improved’ goods or 
services.    Improvements  could  include  cost,  quality,  usability,  reliability  and 
longevity. 

2.  Data  and  information  for  administrators  and  third  parties:    Enhanced  access  to  5G 
capabilities and information, including real-time data, will help administrators and other third 
parties  to  enhance  the  provision  of  services  (to  private  and  public  sectors)  including  traffic 
management, security and data for pupic healthcare management. 

3. New business models will utilise 5G capabilities to enable new business models to develop 
and new goods and services to be provided 

22   ABI research: https://www.abiresearch.com/press/expanding-beyond-mobility-management-enterprise-mo/ 
23   Study SMART 2014/0008: "Identification and quantification of key socio-economic data to support strategic 
planning for the introduction of 5G in Europe", addressing mainly 4 sectors: the automotive, health, transport 
and energy sectors.  

24   Ericsson Mobility Report 2016. 

12 

 
 
                                                 
These benefits are quantified in the table below:  

industrial 
sectors 
benefits 

Automotive 
(€ mn) 

Healthcare 
(€ mn) 

Transport 
(€ mn) 

Utilities 
(€ mn) 

Total 
(€ mn) 

Strategic 

13,800 

Operational 

1,800 

Consumer 

Third Party 

13,900 

13,700 

1,100 

4,150 

207 

72 

5,100 

3,200 

- 

- 

775 

19,770 

2,700 

3,000 

- 

11,850 

17,110 

13,770 

Total 

42,200 

5,530 

8,300 

6,470 

62,500 

There are also significant "second order" benefits, estimated at €50 billion in the year 2025,  
based on the "knock-on" impacts resulting from the use of goods and services. They generally 
concern more indirect benefits to society. 

The  above  results  provide  some  guidance  for  the  industry  related  trials  that  are  likely  to  be 
supported in Europe to test the introduction of the new 5G services. 

These  data  also  indicate  that  fast-paced  digitalisation  of  key  industrial  sectors  (such  as 
transport,  logistics,  automotive,  manufacturing,  media,  entertainment)  and  the  public  sector 
(including smart cities, public safety, health and education) provides ample opportunities for 
Europe’s information and communication technologies (ICT) industry to bring to market new 
and innovative solutions whilst positively contributing to societal requirements. 

Despite  this  availability  of  early  data,  the  business  opportunities  still  require  further 
investigation  because  the  digitalization  of  the  many  industries  in  transformation  will 
significantly  disrupt  the  current  business  models.  A  particularly  relevant  example  is  the 
transformative effect and economic shift towards new service delivery models (e.g. where "on 
demand"  approaches  will  replace  long  term  planned  contracts)  for  which  the  expected 
significant redistribution of revenues streams cannot yet be fully assessed. This implies the 
need  for  increased  cooperation  between  the  various  communities  of  stakeholders  to  be 
able to assess more precisely the evolution of the value chain.  

13 

 
 
 
Relevant results of the EC targeted survey:  

-  The importance of the 5G "holistic" perspective, encompassing the widest possible 
range of 5G use cases from the beginning, is well reflected in the survey results: 50% 
of respondents agree that 5G European deployment should target as a priority from the 
start  the  services  that  enable  the  creation  of  ecosystems  with  key  industries,  namely 
mMTC    and  URLLC    classes  of  use  cases.  This  holistic  apptroach  is  massively 
supported by the ICT industry and SMEs whilst 20% disagree. Within this latter group 
can  be  found  individuals,  small  players  in  specific  markets  like  content  production, 
and a few academics and research centres. Only two large operators disagree with the 
view of the core ICT community. 

-  There  are  also  differences  of  view  with  regard  to  the  market  prospects.  78%  of  the 
respondents believe that by 2020, roughly at the time of 5G commercial introduction, 
eMBB  will be the dominant market application.  

-  This  is  however  modulated  by  the  facts  that  in  2025,  5  years  after  5G  introduction, 
42% of the respondents also believe that mMTC will be the largest market, ahead of 
eMBB.  The  dividing  line  is  between  the  IT  industries  outside  of  the  telecom  sector, 
potential 5G users, which place mMTC and URLL ahead, whilst the classical telecom 
actors tend to have higher expectations for eMBB. 

6.  Coordinated market deployment, learning our lessons from 4G 

Today, the proportion of 4G/LTE subscriptions measured against the total population is 75% 
in the US, 82% in the Republic of Korea, 65% in Japan, and 28 % in the European Union25. 
These figures suggest a delay in market deployment of 4G in Europe that many attribute to a 
lack  of  a  coordinated  approach  within  the  single  market,  in  particular  with regards  the  time 
table  for  the  release  of  the  radio  spectrum  frequencies  to  operators,  as  well  as  the  initial 
unavailability of 4G devices in the EU 26.  

International  comparisons  show  that  there  is  an  objective  correlation  between  early 
availability  of  spectrum  and  fast  market  take  up.  In  the  US  auctions  of  the  700  MHz  band 
were held as early as 2008. Subsequently, Verizon launched its LTE network in 2010 and by 
July  2012  had  more  than  304  cities  covered  with  LTE,  about  75%  of  the  US  population. 
AT&T launched its network in 2012, and had more than 47 city markets with LTE by July of 
that year. In comparison, Europe organized its auctions significantly later, and in a somewhat 
dispersed order. Auctions of suitable LTE spectrum (mainly 800 MHz and 2600 MHz bands) 
occurred over a wider time span in Europe: in 2010 in Germany, in 2011 and 2012 in France, 
in 2011 in Italy and Spain, and 2013 in UK and Poland27. This has led to a corresponding "lag 
time"  for  actual  network  deployment  and  commercial  pan-European  4G  operations.  It  is 
interesting to note that in spite of early auctions in Europe over the last 2 years, the 700 MHz 
band will not be fully available on an EU-wide scale before 2020, 12 years after its US-wide 
availability. This interdependency also highlights the strategic importance of making the 700 

25   Source: Idate, figures of 2015. 
26   See e.g. Mobile Wireless Performance in the EU & US, May 2013, GSMA and Navigant economics 

27 This was the planned date for Poland; the actual auction was further delayed to 2015 

14 

 
 
                                                 
MHz band available for mobile wireless applications as quickly as possible, especially for the 
purpose of reaching appropriate coverage objectives in due time28.  

The  early  identification  of  suitable  and  harmonised  frequency  bands  is  also  an  important 
factor.  The  figure  below  outlines  the  different  regional  approaches  towards  4G  spectrum 
availability, illustrating the current difficulty in achieving global harmonization, a risk that is 
likely  to  arise  also  with 5G. Despite the size of the country, Verizon in the US was able to 
reach 97% population coverage within three years of  launch, due to its initial assignment of 
low  frequency,  high  propagation  "coverage  band"  spectrum  in  the  700  MHz  range.  On  the 
other  hand,  later  regional  choices  of  spectrum  not  massively  adopted  by  lead  markets  may 
have  slowed  down  the  speed  for  local  availability  of  suitable  terminals.  This  demonstrates 
once  again  that  late  adoption  and  lack  of  global  spectrum  harmonization  have  an  adverse 
impact on the take-up of services and on the pan-European footprint that can be achieved by 
those services.  

Share  of  LTE  deployments  by  frequency  band,  by  region  (January  2015).  Source:  GSMA 
Intelligence 

28 The Commission's proposal for a Decision of the European Parliament and of the Council on the use of 
the 470 – 790 MHz frequency bands in the Union, COM(2016) 43 final, provides that the relevant spectrum 
be made available across the EU by 2020.  

15 

 
 
 
                                                 
 
Relevant results of the EC targeted survey:  

The issues raised by the delayed 4G licensing is well reflected in the results of the targeted 
survey. As regards the best introduction model for a new network technology (taking 2G, 
3G,  and  4G  as  example  scenarios),  the  model  that  was  used  for  the  introduction  of  4G 
(absence of coordination besides the technical  harmonisation of spectrum)  gets the most 
negative assessment, with 40% of respondents considering the 4G introduction scenario as 
the model to exclude in the future, and only 27% rating it positively The model that gets 
the highest support is the 2G co-ordinated introduction model, with 40% of positive rating 
and  only  21%  considering  this  scenario  as  outdated.  This  is  particularly  clear  in  the 
responses  of  users  of  technologies  and  non-ICT  industries.  However,  IT  players  in  the 
telecom  sector  have  more  of  a  "neutral"  position  on  average  in  the  survey,  albeit 
supporting the view that the 4G licensing model, complemented by a target time frame for 
making  available  5G  bands  and  licensing  conditions,  i.e.  introducing  some  MS 
coordination, would be the best compromise.  

7.  Radio Spectrum Issues 

From  a  spectrum  availability  perspective, the  agenda  is  framed  by  the  ITU  process  towards 
defining 5G bands above 6 GHz at the World Radio Conference 2019 (WRC-19). The WRC-
15 decided to put on the agenda of WRC-19 a specific agenda item related to 5G frequency 
bands as follows:  

-  WRC-19  Agenda  Item  1.13:  to  consider identification  of  frequency  bands  for  the 
future  development  of  International  Mobile  Telecommunications  (IMT)  including 
possible  additional  allocations  to  the  mobile  service  on  a  primary  basis  in 
accordance with resolution COM6/20 (WRC‑15) 

-  RESOLUTION  COM6/20  (WRC-15)  invites  ITU-R  to  conduct  and  complete  in 
time  for  WRC‑19  the  appropriate  sharing  and  compatibility  studies  for  the 
frequency bands: 

-  24.25-27.5 GHz, 37-40.5 GHz, 42.5-43.5 GHz, 45.5-47 GHz, 47.2-50.2 GHz, 50.4-
52.6 GHz, 66-76 GHz and 81-86 GHz (with allocations to the mobile service on a 
primary  basis), and 31.8-33.4 GHz,  40.5-42.5 GHz  and 47-47.2 GHz  (which  may 
require additional allocations to the mobile service on a primary basis) 

Several  leading  nations  however  clearly  intend  to  accelerate  the  timing  of  5G  deployment 
through  focusing  on  alternative  spectrum  ranges,  both  below  and  above  6  GHz.  This  is 
notably the case of: 

-  The  Republic  of  Korea,  which  has  already  identified  spectrum  and  assigned  3 
blocks of 1 Ghz each to 3 operators at 28 GHz, and which is currently deploying 
infrastructure to be in time for the Olympic Games in Pyun Cheong in 2018, where 
early 5G introduction is planned. It may be noted that the deliberate choice of the 
28 GHz frequency band does not conform to the ITU resolution above;  

- 

Japan, is taking steps to introduce 5G in bands below 6 GHz in the context of the 
Tokyo Olympic Games in 2020, with the intention of designating 5G spectrum by 
the end of 2016;  

-  China, has started a comprehensive 5G trial programme, aiming at full testing of a 
complete 5G system before 2020. The programme runs over 3 phases: phase one, 
until  end  of  2018,  is  primarily  R&D  and  validation  of  key  technologies  and 

16 

 
 
subsystems;  phase  two,  from  2018  to  2020,  is  about  system  and  products  R&D 
trials;  phase  3,  post  2020,  is  about  gradual  commercial  introduction  and 
application trials,  with  a  likely  focus  on  industrial  applications.  Though  China  is 
not  part  of  the  nations  willing  to  accelerate  the  pace  of  the  International 
organisations,  the  intention  of  China  is  to  be  part  of  the  leading  nations  for  5G 
introduction. To that end, CN has already selected the 3,4 -3,6 GHz band for early 
trials and later introduction. 

-  The USA is part of those nations willing to accelerate the pace of 5G introduction. 
Worth  noting 
the  US  administration  on  global 
standardisation bodies, and their paradigm that spectrum allocation is the decisive 
key  to  fast  track  5G.  This  is  well  illustrated  by  the  statement  of  FCC  chairman 
Tom Wheeler29:  

low  reliance  of 

the 

is 

“The  United  States  approaches  the  kind  of  opportunity  5G  presents  somewhat 
differently  from  other  countries.  We  do  it  by  indicating  which  spectrum  will  be 
made  available  and  then  relying  on  a  private  sector-led  process  for  producing 
technical  standards  best  suited  for  those  frequencies.  We  won’t  wait  for  the 
standards to be first developed in the sometimes arduous standards-setting process 
or in a government-led activity.” 

In  line  with  this  approach,  the  FCC  released  on  14  July  2016  the  "Spectrum 
Frontier" rulemaking, laying down a set of applicable 5G frequency bands in the 
US together with their conditions of use. Similarly to the Korean case, some of the 
frequency  choices  (28  GHz  band)  do  not  follow  the  above  ITU  Resolution.  The 
fast  track  approach  of  the  FCC  is  also  mirrored  by  US  operators'  initiatives, 
targeting 5G introduction by 2018. 

In February 2016, several operators, KT, NTT DoCoMo, SK Telecom and Verizon, agreed to 
form a new global initiative called the 5G Open Trial Specification Alliance30. In July 2016, 
major US operators also announced having already completed 5G specifications31.  

In  Europe,  and  in  view  of  the  fast-track  spectrum  developments  in  key  regions,  the  Radio 
Spectrum Policy Group (RSPG) has launched work to identify by the end of 201632 pioneer 
spectrum bands for Europe's early 5G launch as of 2018, in line with the ITU priorities and 
thus  with  a  maximum  potential  for  global  harmonisation.    Furthermore,  the  RSPG  plans  to 
deliver an Opinion on a 5G spectrum roadmap, including aspects of spectrum allocation and 
authorisation, by early 2018. To this end, the Commission is working with the Member States 
within  the  RSPG  and  also  plans  to  initiate  technical  studies  at  EU  level  to  enable  timely 
harmonisation measures delivering 5G spectrum to market players.   

29   Remarks of FCC Chairman Tom Wheeler at March 8, 2016 Satellite Leadership Dinner. 
30   https://www.nttdocomo.co.jp/english/info/media_center/pr/2016/0222_02.html 
31  http://www.verizon.com/about/news/verizon-first-us-carrier-complete-5g-radio-specifications-pre-

commercial-trials-continue-full; these specifications are focused on eMBB use case and seem limited to fixed 
wireless access. 

32   Document RSPG16-031Final, see http://rspg-spectrum.eu/public-consultations 

17 

 
 
                                                 
In that context, and considering the importance of 2020 as a target date for roll-out of large 
scale commercial 5G networks, the following aspects are considered as the most important by 
the stakeholder community:  

-  Making  the  700  MHz  available,  preferably  Europe  wide,  to  mobile  services  by  2020  as 
proposed  in  the  relevant  proposal  for  a  Commission  Decision  addressing  UHF  bands  (see 
section 6). 

- Exploiting the opportunities offered by spectrum already harmonised in the EU for mobile 
broadband applications below 6GHz, more particularly the 3.4-3.8 GHz band. 

- Identifying before WRC-19 the applicable frequency bands above 6GHz having the widest 
possible harmonisation potential. 

Relevant results of the EC targeted survey:  

-  The central role of spectrum availability is well reflected in the survey. Whilst 46% 
of respondents do not consider it necessary to already identify the 5G pioneer bands by 
the end of 2016, a majority of 63% consider that these bands need to be identified by 
the  end  of  2017.  This  includes  the  ICT  industry,  user  industries  and  a  number  of 
SMEs. Only a limited share of respondents, 24%, believe that it would be acceptable 
to  wait  until  the  results  of  the  next  WRC  conference  in  2019  before  allocating  the 
spectrum,  including  one  large  operator,  one  vendor,  and  the  satellite  industry  with  a 
few  individual  respondents.  Overall  there  is  strong  support  for  early  decisions  on 
5G pioneer bands in advance of WRC-19. 

-  There is large support for bands to be globally harmonised: 73% find it is a must, 
only  9%  disagree.  Those  who  are  neutral  or  disagree  include  mainly  academics  and 
industries in non-ICT domains, like banks or transport solution providers. There is a 
relative  majority  group  of  40%,  mainly  composed  of  large  industrial  players,  who 
disagree  with  the  proposition  that  lack  of  harmonisation  can  be  compensated  by 
technology using a "tuning range" approach. 

-  Regarding  the  identification  of  pioneer  bands,  3  spectrum  bands  gain  most 
preference for 5G introduction in Europe: the highest scores go to the 700 MHz, the 
3.4-3.8 GHz band and the 24-27 GHz frequency ranges. However, it is worth noting 
that 40% of the respondents place themselves in the category "do not know". It is also 
interesting to further underline that the 28-29 GHz option, contemplated in the US, has 
not much support whilst the 31-33 GHz option, seen as more appropriate in Europe, 
also gets limited support. There is a clear preference for the lowest possible spectrum 
bands, due to their propagation characteristics. The respondents most supportive of the 
3  preferred  pioneer  bands  mentioned  above  include  network  operators,  ICT 
technology  suppliers  and  a  few  industry  users,  e.g.  from  the  energy  and  transport 
sectors. 

8.  Trials and early roll out 

In addition to the trial directions mentioned in section 4 above, intensive cooperation between 
industries have taken place over the last year to define the core 5G characteristics needed to 
serve  innovative  business  models  (transport  and  especially  the  automotive  sector,  health, 
energy,  smart  factories,  media  and  entertainment).  This  work  was  mainly  conducted  in  the 

18 

 
 
 
 
context of the 5G PPP33 and allowed a number of business cases to be identified that would 
require availability of technologies beyond the capabilities of existing networks. The diagram 
below illustrates these requirements.  

These  figures  illustrate  the  fact  that  automotive  health  and  media  and  entertainment  are 
potentially the most demanding use cases (applications) in terms of requirements that cannot 
be satisfied with existing technologies34, which implies that industry needs further trials and 
joint work before validating new technologies and business models.  

The European positioning of stakeholders vis-a-vis these developments is reflected in the box 
below.  

33 White Paper: 5G empowering vertical industries. 
34 A "dot" on the outermost line of the spider diagrams below means that (part of) the requirement of the 
considered business model can not be met with today's networks 

19 

 
 
 
                                                 
Relevant results of the EC targeted survey:  

-  Regarding the default 5G introduction date set by the standardisation organisations as 
2020, the relative majority of respondents, 43%, support this as a target with only 18% 
disagreeing. It needs to be noted however that a part of the "neutral" and disagreeing 
respondents do actually call for earlier introduction. Altogether, more than 50% of 
respondents estimate  that  early trials  and pilots are  needed before 2020 i.e.  that 
by 2018 cross-country trials and pilots should already be available on a large scale if 
Europe wants to achieve significant commercial deployments in 2020. This category 
includes basically all ICT solution providers and a significant proportion of operators. 
It also includes content companies and some non-ICT industry players, who state that 
in  some  cases  the  need  is  already  there  today  (e.g.  low  latency  communications).  A 
limited number of respondents from large companies indicate that the timing of actual 
deployments,  especially  when  they  require  large  investments,  should  be  decided  by 
operators according to their business plans (1 operator).  

-  Regarding the need for showcasing events in Europe (e.g. mirroring the Olympic game 
5G  showcasing  events  in  Asia)  there  is  a  good  support  for  such  initiatives  to 
"show"  European  leadership,  with  56%  of  the  respondents  agreeing,  and  massive 
support from large industrial (ICT or other industries) actors. Only 25% do not see the 
interest. Supporters include primarily larger companies and users, whilst disagreement 
comes mainly from SMEs, academics, a citizen association and individual responses. 
Three operators are also in that category, but no technology suppliers. Views vary on 
the date for such events: 2018 is proposed by half of the supporters whilst 2017 and 
2019 get about 25% each.  

-  Regarding  trials  and  use  cases  that  Europe  should  concentrate  on,  the  picture  is 
diverse, but the majority of respondents, about 60%, focus on Automotive/Connected 
vehicles/Traffic  management  and  media  and  entertainment.  These  cases  are  also 
well  flagged  in  the  industry  manifesto.  The  typology  of  these  respondents  is 
dominated  by  the  ICT  service  and  technology  providers,  with  smaller  content 
companies. 

9.  Standards 

The main technical steps for the preparation of the commercial introduction of 5G are framed 
by  the  agenda  of  international  standardisation  bodies.  3GPP,  the  key  global  standardisation 
body  in  the  area  of  mobile  communication  network  standardisation,  officially  started  the 
standardisation  process  in  September  2015,  with  an  inception  workshop  in  Phoenix  that 
gathered more than 500 participants. Since then, the standardisation agenda has been defined. 
3GPP  has  planned  to  deliver  a  first  release,  release  15,  (mainly  focused  on  broadband  with 
some complementary aspects related to low latency use cases) by mid 2018 whilst a second 
release  covering  the  complementary  use  cases,  related  to  industry  applications,  would  be 
available by the end of 2019 under 3G PP release 16. There is still some uncertainty related to 
the  exact  content  of  the  work  item  to  be  started  in  March  2017:  the  actual  standard 
specification  phase  after  the  study  item  collecting  the  industrial  requirements.  A  full 
agreement  on  this  next  phase  has  not  yet  been  reached,  in  particular  regarding  the  question 
whether the first phase should focus on eMBB only  or already accommodate additional use 
case scenarios. The figure below shows the standardisation time line agreed at the last 3G PP 

20 

 
 
 
TSG RAN35 plenary meeting in Busan, in June 2016. The next important decision point will 
take place in March (on the strategy for new radio interfaces).  

Source, Deutsche Telekom, EUCNC 2016 conference  

The  timing  outlined  in  the  above  figure  relates  mainly  to  new  radio  access  and  new  radio 
access  network  architecture.  In  parallel,  3GPP  is  also  actively  working  on  standards  to 
redefine  the  core  network  under  the  3GPP  "System  Architecture"  (SA)  Group.  This 
standardisation  track,  which  eventually  should  support  different  industrial  users  with 
differentiated  controls  of  their  service  requirements,  is  also  key  to  support  future  network 
based  innovation  through  SMEs  and  start-ups.  However,  due  to  the  current  focus  on  radio 
access,  this  part  of  the  standardisation  exercise  attracts  less  attention  from  the  stakeholder 
community 

From a global (as well as European) perspective, these fast-track approaches focused on radio 
access raise a number of challenges: 

-  The risks that a parallel, potentially proprietary, specification develops outside of 3G 
PP,  as  was  the  case  with  WiMax  –  LTE  parallel  tracks,  also  limiting  openness  and 
innovation capabilities;  

-  The  risk  that  the  standardisation  bodies  accelerate  their  pace  under  commercial 
pressure, limiting  the scope  of the standard and its ability to  evolve to cover a more 
holistic set of use cases;  

-  The  risk  that  the  core  network  standards  get  less  attention,  limiting  the  potential 
openness of future network platforms, hence limiting the prospects for developing an 
innovative community of third party developers;  

-  The  risk  that  Europe  lags  behind,  in  spite  of  a  globally  recognised  technological 

excellence.  

35   Technical Specification Group "Radio Access Network" of 3G PP. 

21 

 
 
 
                                                 
Relevant results of the EC targeted survey:  

Standards 

-  Regarding  standards,  the  survey  results  do  not  oppose  an  acceleration  of  the 
pace of the standardisation process. However a number of respondents point to the 
risk  of  limiting  the  scope  of  standards.  64%  of  respondents  agree  that  the 
standards  should  not  be  limited  in  priority  to  the  eMBB  use  case  but  should 
rather  include  from  the  onset  the  other  "industry"  driven  use  cases  such  as 
Machine to Machine communication and ultra-low latency use cases. Virtually 
all operators and associations, with technology providers as part of that category, 
complemented  by  research  institutes  and  SMEs  in  various  sectors  (content, 
transport), hold that view. Only 11% disagree, mainly individual respondents and a 
few SMEs.  

-  There is also strong support for standards that address both the radio access and the 
core  network  architecture,  to  support  new  business  models.  60%  of  respondents 
agree that the two issues should be tackled together, i.e. radio should not be the 
only  focus.  This  trend  confirms  the  earlier  public  consultation  on  standards  that 
took  place  under  the  DSM  initiative.  It  includes  most  of  the  ICT  service  and 
technology  providers  with  user  companies  in  different  sectors  (transport,  energy, 
bank, content). Those who did not support such a combined approach are mainly 
SMEs, individuals and national organisations.  

in  a 

-  There  is  very  good  support  for  the  principle  whereby  the  European  Commission 
should set out a strategy to ensure that appropriate standards can be developed and 
agreed 
interface  between 
communications functions and third party service providers (like industrial users). 
This  role  for  the  Commission  is  supported  by  65%  of  the  respondents  (13% 
disagree). Those who did not support such combined approach are like under the 
previous topic mainly SMEs, individuals and some national organisations.  

in  areas  concerning 

timely  manner 

the 

10. Investments Issues 

The success of the commercial deployment of 5G will depend critically on the timeliness and 
intensity of investments in two key areas: 

1.  Investments in infrastructure: mainly to lay out a dense fibre network infrastructure 
to  ensure  the  backhauling  of  5G  cells,  as  well  as  to  finance  the  installation  of  the 
actual  5G  cell  equipment.  The  densification  of  cells  is  necessary  to  optimise  both 
capacity and spectrum re-use between base stations. 

2.  Investments  in  service  innovation:  to  stimulate  the  emergence  of  the  new  5G-
enabled  services.  This  includes  both  the  financing  of  pilot  projects  at  the  end  of  the 
research and development cycle and investment to support an ecosystem of innovative 
companies where the new services will be "discovered" and developed (ecosystem of 
both start-up companies and larger organisations). 

Investment in infrastructure 

Each successive generation of mobile infrastructure has cost more than previous generations. 
Every generation has required more spectrum and cells have got smaller, meaning there has 

22 

 
 
 
generally been a linear increase in base station numbers, the costs of which have been reduced 
in a linear manner by more efficient technologies.  

The  actual  prospect  of  such  investments  will  be  affected  by  multiple  and  complex  factors 
including regulation, market readiness, interest rates, etc.. 5G being a new technology in sight 
with disruptive effects, work is still needed to understand how European conditions by 2020 
can  be  made  most  conducive  to  investment  in  5G.  However,  the  survey  results,  as  outlined 
below,  confirmed  within  a  larger  stakeholder  base  a  number  of  issues  which  were  already 
addressed during the preparatory steps of the 5G Action Plan in the context of the high level 
industry  reflection  group  launched  by  Commissioner  Oettinger  at  the  last  Mobile  World 
Congress in Barcelona. 

Relevant results of the targeted survey:  

-  57% of the respondents are of the opinion that the telecom operators can finance the 
deployment  of  5G  in  Europe.  This  is  supported  by  academics,  SMEs,  national 
organisations and one OTT. The disagreements come from all operators and operators 
associations, from technology suppliers and a number of user industries across sectors. 
This  is  to  be  modulated  by  the  fact  that  a  relative  majority  of  45%  believe  that  co-
investments with other industrial sectors represent a realistic scenario for industry 
driven  use  cases.  This  is  supported  by  all  ICT  players  but  also  by  a  number  of 
industries  in  user  sectors  and  SMEs.  It  is  to  be  noted  that,  at  the  moment,  most  key 
players  in  the  field  believe  that  the  level  of  investments  required  for  the  5G 
deployment  across  Europe  is  hard  to  estimate,  given  the  different  strategies  each 
operator will decide to follow and the scenarios and use cases initially considered.  

-  A sizeable share of respondents (45%) consider that public funding is necessary for 
full deployment of 5G networks across the EU, notably through the European Fund 
for  Strategic  Investment,  the  European  Investment  Bank,  national  or  regional  funds. 
This  trend  is  very  visible  among  replies  from  large  industry  players.  Infrastructure 
support is the main target (see below). 

-  A clear majority  of 63%  of respondents agree that  Infrastructure  funding should  be 
focused on backbone fibre networks, and facilitate competition in the development 
of 5G . Only 12% disagree. 

-  54%  support  the  idea  that  5G  deployment  would  be  facilitated  through  specific 
measures reducing the cost of deployment of access facilities. The main identified 
issues  include:  i)  addressing  issues  related  to  building  permits  and  rights  of  way  (in 
line with other major infrastructure projects, such as electricity pylons, and their low 
rents/legal  protection);  ii)  planning  restrictions  on  small  cells;  iii)  harmonizing 
radiation  limitations  at  a  European  level  so  as  to  avoid  some  countries  and  regions 
having  significantly  more  severe  rules  than  the  harmonised  norm;  iv)  taxes  on  sites 
and administrative fees. 

Investment in service innovation activities 

5G  will  also  require  substantial  investment  in  more  downstream  innovation  than  previous 
generations  of  communications  systems.  In  fact,  the  integration  of  the  future  advanced  "5G 
connectivity" in applications across key industry sectors will follow innovation models close 
to  the  "Internet  innovation"  process,  where  experiments  and  trials  take  a  larger  role  in 

23 

 
 
 
comparison to the linear R&D approach that has prevailed in network innovation so far. New 
business  ecosystems  will  emerge  in  which  a  multiplicity  of  players  will  meet,  compete  and 
work  together.  This  will  open  opportunities  to  start-ups  and  smaller  players,  which  will 
eventually  profit  from  the  innovation  capabilities  offered  by  networks  providing  open 
interfaces  to  develop  network  "apps"  and  services,  similarly  to  "app"  developments  already 
taking place through cloud computing platforms.  

To address this challenge, industry suggested setting up a 5G Venture Fund36 to accompany 
the  European  innovative  start-up  companies  aiming  at  developing  5G  technologies  and 
applications across industrial sectors. This could eventually become a catalyst for substantial 
digital  innovation  at  European  scale,  beyond  connectivity,  and  accelerate  the  ultimate 
digitisation of a larger number of industries and sectors. 

The  proposed  approach  under  consideration  is  to  set  up  a  mechanism  combining  several 
sources of equity financing from both corporations and public authorities through a shared EU 
decision  platform  that  would  reflect  a  common  strategy  and  provide  consistency  in  co-
investment decision making (a targeted venture financing facility). 

Under this possible arrangement, companies could bring together some part of their corporate 
venture  capital  investment  leveraged  by  public  funding  resources  tentatively  related  to  EU 
Financial  Instruments  such  as  the  "Single  EU  Equity  Financial  Instrument",  as  a  typical 
example.  The  synergies  between  such  an  initiative  and  similar  investment  activities  in  the 
digital  sector  would  deserve  to  be  explored  as  to  avoid  overlap  with  existing  financing 
opportunities.  It  would  also  be  relevant  to  ensure  an  adequate  coordination  with  the  main 
infrastructure investments and with the trial projects financed from other sources. 

11. Conclusions 

5G  developments  world-wide  are  accelerating  and  deployment  has  now  become  part  of  the 
5G  agenda  of  leading  regions.  The  European  Commission  has  a  significant  role  to  play  in 
promoting  5G  deployment,  as  clearly  shown  in  the  targeted  survey,  with  73%  of  the 
respondents  agreeing  with  this  assumption.  The  present  Staff  Working  paper  outlines  a 
number  of  key  issues  that  need  to  be  addressed  to  move  forward  with  a  5G  deployment 
agenda,  notably  in  the  fields  of  spectrum,  standards,  pre-commercial  introduction  trials, 
investment-friendly regulation and support. These correlate with the set of actions proposed in 
the 5G Action Plan and provide supporting material in view of its wider European adoption.  

36   See page 3 and 4 of the 5G Manifesto for timely deployment of 5G in Europe, 7 July 2016: 

http://ec.europa.eu/newsroom/dae/document.cfm?action=display&doc_id=16579. 

24 

 
 
 
 
                                                 
Annex: 5G Targeted Survey, Summary Figures 

A total of 249 replies were submitted within the deadline. 

-  197 (79%) are providers or users of communication products and services. 
-  224  (90%) are  relying  on  connectivity  as  the main  means  or  as  an  important  part of 

Total 
48 
23 
20 
16 
15 
15 
14 
11 
9 
8 
8 
7 
6 
5 
4 
2 
2 
2 
2 
1 
1 
1 
1 
28 
249 

doing business. 

Country distribution: 

Institution/organisation/business operating in: 
Germany 
United Kingdom 
Belgium 
Sweden 
Netherlands 
France 
Ireland 
Spain 
Finland 
Italy 
Austria 
Portugal 
Poland 
Romania 
Denmark 
Hungary 
Slovak Republic 
Bulgaria 
Luxembourg 
Cyprus 
Slovenia 
Lithuania 
Latvia 
Other 
Grand Total 

Type of organisations and sectors: 

National Authority: 5 
Regional Authority: 2 
Representative Association at EU level: 11 
Non-governmental organisation: 21 
Representative Association at national level: 0 
SME: 83 
ICT Industry: 97 
International organisation: 19 
Other: 58 (includes non ICT industries) 

Note: Respondents had the possibility to select none, one, or more than one type of organisation or 
sector to characterise their area of activity. This means that the total of this distribution list does not 
match the total of respondents. 

25