UK Govt Finds Another £25M for 5G

The UK government is making another £25 million ($33 million) in funding available for 5G projects under plans aimed at equipping the country with higher-speed fixed and mobile networks.

The £25 million will come out of the previously announced £740 million ($983 million) National Productivity Investment Fund, through which authorities are trying to support the rollout of next-generation digital infrastructure.

The government says it will make awards of up to £5 million ($6.6 million) available to available to parties that are chosen from applicants as part of a "5G testbeds and trials" competition.

Today's announcement comes after finance minister Philip Hammond allocated £16 million ($21 million) to a 5G research facility earlier this year, meaning £41 million ($54 million) has now been earmarked specifically for 5G this year. (See UK Govt to Spend Loose Change on 5G.)

Digital minister Matt Hancock has cited research indicating that 5G technology could boost GDP growth in the UK by £173 billion ($230 billion) between 2020 and 2030.

"To stay competitive we must be at the cutting edge of new technology and we are determined to be one of the first countries in the world to use 5G," said Hancock in a statement. "In these very early stages we want all ideas, from all parts of the country, that will help us get the technology and the rollout right to have a nationwide network of 5G innovators."

Authorities say they expect projects to be industry-led or have a strong industry component and that funding will only be available to UK-registered organizations.

While award recipients will welcome any public sector funding, the government's 5G commitments so far look derisory given the vast sums that will be needed to build nationwide 5G networks.

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Deutsche Telekom AG (NYSE: DT), the biggest network operator in Europe and a shareholder in the UK's BT, reckons building 5G networks across the continent could cost between €300 billion ($354 billion) and €500 billion ($590 billion). (See DT Plots 5G Across Entire Footprint.)

Equipment vendors including Ericsson AB (Nasdaq: ERIC), Huawei Technologies Co. Ltd. and Nokia Corp. (NYSE: NOK) are currently investing billions of dollars in 5G research and development in the hope this may kickstart another round of infrastructure spending by telecom operators worldwide.

However, there is already concern that Europe may be falling behind the US, Japan and South Korea in the 5G market.

In the UK, a spectrum dispute could hold up the award of the frequency licenses that operators will need to provide 5G services.

UK mobile operators that lack their own fixed-line networks, including Three UK , Telefónica UK Ltd. and Vodafone UK , have also complained that they cannot access the fiber facilities owned by former state-owned monopoly BT Group plc (NYSE: BT; London: BTA) on favorable terms. (See Europe's Backhaul Black Hole Looms Above 5G.)

Operators say they need better access to BT's network to provide 5G "backhaul" connections between basestations and their core network systems.

— Iain Morris, News Editor, Light Reading

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