The European operators’ association says Europe can create 2.4 million new jobs by leveraging a €300 billion digital network investment.
Europe can create 2.4 million new jobs within the next four years through digital transformation, while boosting economic growth and accelerating green transformation.
According to a new report commissioned by ETNO, Connectivity and Beyond: How Telcos Can Accelerate a Digital Future For All, it will need €300 billion in telecoms investment, plus effort to stimulate digital demand and to provide people with digital skills.
The report was prepared by global management consulting firm BCG and is published as the European Union’s heads of state and government gather for the European Council to discuss, among others, the future of Europe’s industrial and digital policy.
BCG analysis finds that 5G alone can generate an annual increase of €113 billion in GDP and 2.4 million new jobs in Europe by 2025. As the EU strives to reignite the economy with the Recovery Plan, building gigabit networks and innovative digital services can help increase productivity and generate smarter ways of working.
BCG finds that a widespread uptake of digital solutions could reduce carbon emissions by up to 15% – 30% emission cuts by smart cities and 30% through digital transformation in the transports sector.
To exploit the opportunity, Europe must ramp up its network investment to achieve ubiquitous gigabit speeds. BCG estimates €150 billion is still needed to achieve a full-5G scenario in Europe (although that does not mean universal coverage), while an additional €150 billion is required to finish upgrading fixed infrastructure to gigabit speeds.
Investing in demand
The report stresses that much effort to stimulate demand side as it found 83% of SMEs with in the EU do not use advanced cloud and 60% of nine year-olds are educated at schools that are not digitally equipped.
BCG estimates that upgrading the digital infrastructure of all European schools would require €14 billion a year, which corresponds to 1.8% of the Next Generation EU fund. Digitalising all European SMEs would require €26 billion a year, or 3.5% of the Next Generation EU fund.
BCG’s analysis finds that the European telecoms sector is accelerating its transformation in 7 main areas: network leadership, new collaboration models, B2B, data-driven customer approach, up-stack innovations, radical simplification, and new ways of working.
This is leading to innovation in cloud, edge-cloud, data-based services, e-ID as well as OpenRAN among others.
Collaboration within the industry and across European industrial sectors emerges as the defining feature of this new phase. European citizens and businesses can expect fresh opportunities for socio-economic growth empowered by digital services designed around European values.
ETNO believes the EU’s overarching digital strategies set the right ambition for digital leadership at the global level. However, these political goals must now permeate policy and regulatory action at both the European and national level, it says.
The report details a series of urgent policy actions, including: strongly increasing the attractiveness of investment in roll-out; allowing for more industry collaboration and scale in the sector; strongly stimulating demand and digital transformation across industrial sectors; prioritising leadership in European digital services; and ambitious investment in digital skills.
Lise Fuhr, ETNO Director General, said, “This report shows that Europe’s gigabit opportunity is extremely relevant to today’s top challenges, including recovery and the green transition. We call on European leaders to support the telecoms sector and help us deliver a stronger digital economy for all citizens”.