5G’s potential to transform cities is vast, with public space, transport and healthcare all areas that could be overhauled.
Urban populations are set to explode across the globe with two-thirds of the world’s population predicted to live in cities by 2050 according to the UN. That influx of people will put a strain on transport systems.
EXECUTIVE SUMMARY
Main impacts of 5G on cities
Smarter cities -
Thousands of 5G sensors across cities will collect data, informing better use of resources and management of assets. Greener, cleaner cities - smart energy grids will be able to monitor and universally automate energy usage. As more devices and sensors are connected these systems’ ability to adjust to supply and demand will increase.
Better utilisation of existing infrastructure -
Hardwiring 5G technology into transport management systems across road and rail, they can be made more efficient and able to cope with increased demand.
Vehicle-to-everything -
If driverless cars are to become fully autonomous, it is crucial that they can communicate with cars around them and the roads they are on. 5G enabled sensors will make this a reality thanks to its higher speeds compared to 4G
Healthcare -
5G’s seamless connectivity can enable AI and sensors that monitor patients’ health in real time. Virtual surgery through AR and VR will mean expert surgeons can perform operations from the other side of the globe
Within the residential sphere, it is important to separate out the benefits for consumers:
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Up to £90bn boost
to the UK economy by 2030
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A massive driver of fibre to the home/business
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The potential to make our cities cleaner and greenerBIGGEST OPPORTUNITIES OF 5G
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Cost of infrastructure – who will front the cost of the small antennae needed to comprehensively cover London■
Regulators have given mobile operators wide-ranging powers causing friction with landowners■
Huge cost to create density needed■
Rural areas could be left behind compared to cities in 5G coverage
CHALLENGES
5g podcasts
5G EP1: SMART CITIES
27:20
The first episode of our 5G podcast series examines how better connectivity and better data can change how we interact with and plan our cities…
5G EP2: INFRASTRUCTURE
25:24
The second episode of our 5G podcast series examines how we organize the provision of better connectivity and in particular the infrastructure needed for 5G…
5G EP3: CONNECTIVITY
29:44
The third episode of our 5G podcast series examines how the property sector ensures connectivity across its assets and what the benefits are for those that ensure a quality digital offering…
INTRODUCTION
what 5g means for cities
By Andrew McVeigh
“Serve the public trust. Protect the innocent. Uphold the law.”
Sci-fi fans will recall these being three of RoboCop’s prime directives from Paul Verhoeven’s classic 1987 movie. It charted a dystopian Detroit bristling with bile and brutality in the near future. Amid the gruesome shoot-outs were more sensitive – and occasionally satirical subplots - covering gentrification, media control and what we’d now describe as Big Tech.
Thirty years on and some of these themes have become live issues for cities. Debates around human rights have dogged trials of camera-mounted police armour and wireless, smart-video surveillance combining facial recognition software with AI to identify threats has drawn criticism. Earning trust may take time.
Ironically, 5G could actually make it harder for police to do their job, according to Catherine De Bolle, head of Europol. She told Reuters
last summer that while authorities are now able to listen to and track criminals using mobile devices on the 4G network, “we cannot use them in the 5G network.”
Of course there will be other tools at cops’ disposal: from traffic monitoring analytics to smart lighting and the potential ability to halt vehicles remotely. But while unifying large networks of sensors across factories or other enclosed spaces is one thing, getting enough capacity across dense, chaotically-planned cities full of concrete buildings will be far more challenging.
Providing the seamless connectivity and coverage 5G promises across a city the size of London will require over 500,000 small cell antenna - each providing a limited range of reliable, uninterrupted coverage. This won’t come cheap, not least because Britain is way behind other countries when it comes to fibre which is needed to link infrastructure together.
When it comes to cellular connectivity, according to Ofcom the UK performs much better - they put geographic coverage (from at least one operator) at 91% and also suggest that download speeds vary significantly by operator in the UK, depending on what operators choose to invest and what spectrum capacity is available. Nevertheless, when it comes to the rollout of 5G, most people seem to agree that Britain is one of the world leaders.
As well as millions of small cells fixed to lampposts and litter bins, fibre, antennas and masts will need to sew buildings together, weaving through roads and railways. The EU is ambitiously targeting 2025 for the smart motorway network to cover all member states.
The point here is that considerations around coverage are going to need to be dealt with properly if things like autonomous vehicles are to become a reality. And the wider challenges of what we do outside of cities, where the economies of scale that come from sports stadiums or shopping malls don’t exist, are very real.
To help, the government has responded to complaints from Mobile Network Operators (MNOs) around the exorbitant costs of providing 5G for all by shifting the balance of power towards them. Reform to the Electronic Communications Code (the Code) has enabled MNOs to pay much lower rent on new agreements to occupy space. The Code means that occupiers of land may be forced to accept equipment on their land, and terms (including price) with the MNOs may be set by a tribunal if no agreement can be reached.
A flurry of tribunal activity has occurred, with rent levels being set far below previous highs. Aggrieved landlords, who would always rather have a roof terrace than a huge mast, not only fear cuts in income (which, in fairness, will be modest in real terms even if the relative cuts are steep) are more scared of the inability to redevelop space once mobile infrastructure is in place, legal remedies aside.
Many real estate firms however, recognise that for their buildings to be sustainable, they need connectivity. And the smart ones have planned for this in advance, as our Offices chapter demonstrates. However, the practical upshot of the cases that are making their way through the tribunals, is that 5G infrastructure rollout could well be delayed.
What’s clear is that without buy-in from real estate owners, smart cities able to support millions of IoT devices per square mile, will be tougher to shape. That’s because the sheer density of cities mean it’s essential to pepper real estate with antennae and small cells. But there is a huge upside for cities, particularly when it comes to energy efficiencies and emission reduction.
Being able to monitor and universally automate the energy that goes to wasted heating and lighting could be pivotal to making cities cleaner and greener. This will be critical if we are to execute the
90% cuts in carbon emissions needed
from urban areas by 2050 to meet the Paris Agreement targets.
Data from O2 estimate 5G smart energy grids and applications will deliver 12% cuts to average UK household energy consumption, around £145 less a year on energy bills, saving 6.4 metric tonnes of CO2. This is as much as taking one and a half million cars off the road each year.
Cities are disproportionately responsible for global energy consumption and CO2 emissions, something that is on track to accelerate as more and more people worldwide move from rural to urban areas. Cities
consume more than two-thirds of the world’s energy, and are the source of 70% of the world’s emissions. And with each week seeing an average additional million people
moving to urban areas across the world, the UN estimates
that the proportion of people living in cities across the world will go from just over half in 2018 (55%) to over two-thirds (68%) by 2050.
Frankly, 5G will also be crucial in preparing and future-proofing cities to handle the pressures that the torrential population growth will put on public infrastructure. For example, Highways England
estimates that 5G-enabled smart motorways will be able to fit a fifth car on for every four thanks to 5G’s real-time analytics improvements for lane management.
Making the most of existing capacity is obviously one essential way 5G can help to keep cities livable as more and more move to them. Yet there is still a lack of clarity about just how much infrastructure will be needed or what impact it will have on the aesthetics of buildings. But the use case for applications linking millions of devices to handle improvements in public safety, utilities management, public services and emergency response are growing clearer by the day.
In healthcare, for example, 5G will not only allow for more remote diagnosis but near-predictive preventative healthcare diagnosis, something which would have a huge impact down the line in easing local social care budgets. Similarly, the upshot of autonomous vehicles would be similarly preventative. The societal improvements of the reduction in deaths from road accidents and air pollution caused by congestion verge on the unquantifiable.
That said, with planning laws being restricted to expand permitted development rights (PDR), 5G is about to get a lot more visible outside of cities. While these same extensions to PDR will also make it easier for MNOs to swoop in on buildings, the upshot for landlords is that it will also make it easier for them to move kit if the need comes to redevelop.
What’s needed - and what is largely occurring - is a wholesale rethink on how we consider connectivity. As Bruntwood’s Cliff Dennett accurately puts it: "Today, to not consider connectivity in the same way you would conventional infrastructure in building design is nonsensical. We must be building in mass wireless connectivity right from the design stage, because it is expected."
So, as with pretty much any form of infrastructure, the critical debate will rest upon viability. Operators such as the BT Group are clear that industry-wide proposals such as the Shared Rural Network - aiming to connect the stubborn last few areas of the UK not covered by mobile networks at all - are highly dependent on Government funding to supplement the material investment being made by BT/EE and all of the other operators. In their view, monetary guarantees are the only resolution to a problem amplified by the costs of wrapping sparsely populated areas in coverage. In parallel with what the Government is being asked for, (which will take 4G coverage from 91% to 95%) industry (including BT) are committing to invest in ensuring that choice of networks is far wider than today. Currently only 66% of UK landmass has access to all 4 networks. Industry is extending access to 88% and funding that itself.
Many real estate firms, however, recognise that for their buildings to be sustainable, they need connectivity.
HOW WILL 5G AFFECT CITIES
It’s impossible to put a sensible figure on either the total cost or the full benefits from 5G due to the sheer volume of variables and unknowns. To be clear though, that initial capital outlay for the required infrastructure is certainly no small matter, even though 5G can be built upon existing 4G infrastructure (which will continue to run alongside it after 5G is introduced).
At the heart of city upgrades will be an astonishing amount of fibre-optic cable that needs laying to hook buildings, homes and outdoor antenna up to the 5G network.
According to French think tank IDATE, with just 1.5% of buildings connected to the fibre network in the UK, we rank behind the likes of Serbia (1.9%), Kazakhstan (15.2%), and Russia (35.4%). While it in part reflects the UK’s technically-outdated copper cabling network - something critics argue we have clung to for too long - our ability to support widespread and fast connectivity does appear to have been accomplished in spite of, not because of, infrastructure. In addition it must be remembered that the ability to deliver fibre is impacted by the agreement of landlords to give access to facilitate that and many larger buildings are being missed out in the course of the wider fibre rollout as a result.
Essentially, MNOs want Government support and everyone else thinks the Telco's should pay. In reality, the costs (and the benefits) need to be borne by everyone.
Local authorities could have a big role to play, not least because many need to work hard to attract occupiers back to town centres. They would be wise to take the position of active drivers, encouraging the rollout process, smoothing the path and offering public spaces for innovation use. Nationally, we need proper business rates reform that encourages investment and equalises the competitiveness of physical retail with online. Without this, private businesses won’t have much incentive to invest offline.
Certainly, the incentives to be relentless champions and facilitators of getting 5G kit in place are strong from a local authority perspective. Councils could stand to save millions each year, through better preventative services for health or safety, and better monitoring and measurement of public services and utilities.
public space
transport
According to the UN, the share of the population living in cities across the world will go from just over half in 2018 (55%) to over two-thirds (68%) by 2050.
That influx of people will put strains on existing infrastructure in cities that are vital for commuters and city dwellers alike.
However, 5G technology has the potential to be hardwired into transport management systems for infrastructure like road and rail, making them more efficient and able to cope with increased demand.
In Britain, 38% of train cancellations or delays are due to maintenance issues. But, 5G sensors across railway lines could enable predictive maintenance, meaning problems could be identified long before they become serious or disruptive.
According to a report by mobile phone giant O2, predictive maintenance on the UK’s rail lines could reclaim an estimated £440 million in lost productivity resulting from delayed trains.
Furthermore, 5G has the potential to make our roads less congested and greener through enabling road management systems that can sort out traffic pressures at super-fast speeds.
If these management systems helped reduce traffic congestion by 10%, it could save our economy £880 million a year and reduce CO2 emissions by 370,000 metric tonnes per year, according to O2.
And 5G could even help slash deaths on the roads according to Hitachi Ventara’s Felipe Padilla Gomez, CTO of IoT, AI and Analytic.
healthcare
5G also has the potential to increase numerous aspects of healthcare.
It will enable virtual medicine to increase the effectiveness of preventative care, by allowing doctors to “remotely visit” patients and other standardised checks to be performed by AI.
In the home, there could be more scanning and testing, meaning less need to go to GP surgeries, while at distance monitoring means elderly or disabled patients can stay in their own home, rather than have to live in care.
Advanced computer software is already being used to diagnose patients and spot insights into diseases when there are large datasets to trawl through.
AIs are already being used for medical imaging - where they can analyse thousands of scans - and they can be as good as doctors at spotting lung and skin cancer, alongside eye conditions, according to recent research led by the University of Birmingham and University Hospitals Birmingham NHS Foundation Trust.
In hospitals themselves, remote surgery means a specialist surgeon in China could perform a procedure in the UK through augmented reality surgery.
Robotic and robot assisted surgery will also make complex surgery safer and minimise discomfort for patients – while machines can perform much of the preparation and alignment which reduces the time needed for a surgeon to be there, freeing them up for other procedures.
More simply, the design of wards could change. Patient records can be linked to each bed, while a machine with sensors could transmit issues to nurses, which could mean more private rooms as line of sight isn’t needed.
This is something that is being practically applied now. The NHS announced in August 2019 it is setting up an AI laboratory to enhance the care of patients and research, with Health Secretary Matt Hancock saying AI had "enormous power" to improve care, save lives and ensure doctors had more time to spend with patients.
Most importantly, the ability to dedicate specific bandwidths through network slicing will ensure connections for essential functions can be guaranteed.
personal data and privacy
The network of sensors that 5G will produce will also allow us to better on how a city works and improve processes.
A large part of that physical management of cities will rely on the effective collection of all that data, its analysis and its management, alongside its effective ethical use.
“It will provide better data for planning simulations, and the understanding on the more behavioural side of things, particularly in relation to the movements and desires of people. This will allow us to plan infrastructure better in the future,” says Dr Eime Tobari, Director of Urban Analytics at AECOM.
Tobari used the example of work she had done along the Oxford-Cambridge Arc for a previous employer. Milton Keynes, sitting halfway along the arc, wanted to know the potential benefit from the East-West Rail, and the proposed new Expressway. Tobari conducted a simple study using the spatial network model, which was integrated with some other datasets such as public transport, land use and demographics.
“It found that neither new piece of infrastructure would help Milton Keynes residents access significantly more jobs within half an hour,” says Tobari.
“This does not suggest new infrastructure was unnecessary but highlighted the importance of local transport network that connects residents to the regional infrastructure for them to benefit from it.”
Increased connectivity and devices will of course result in more data – and allow us to measure more accurately a variety of things. But there are issues that come with this.
Currently, many analysis programs focus on visualising data, rather than actually analysing it or using it for new purposes.
“We still don’t necessarily have sufficient skills to use the data effectively,” says Tobari.
“We already collect huge amounts of information and there are cool visualisation tools. But we need to go beyond a visualisation to extract insight and to create a new solution.”
There then rest problems, ethical and in terms of privacy, of accessing that data.
Some commentators think that provided companies can show the use case of sharing data, the public will be more easily won over.
“Convenience is everything: while there are data and privacy concerns, people love convenience and they will exchange their data for what makes their lives better and gives a great experience. When everything is IoT connected, people will be frustrated when it isn’t,” says Bertie Van Wyk, Workplace Specialist at Herman Miller.
However others remain sceptical. The recent backlash towards facial recognition technology at Kings Cross is a case in point, with any benefits to security being seen as less valuable than breaches of privacy.
“Mobile companies and infrastructure companies already have huge amounts of information about behaviour, but it is understandably private” says Tobari.
“With the current backlash against big tech companies and the way they handled personal data, this may not change quickly, but the question is how legislation can push to a more open data culture, while still protecting our rights.”
Traffic lights can be connected through 5G, so can a dustbin, or a water pipe. In this sense, the sensor can tell the monitoring body when a bin needs emptying or a pipe is losing pressure.
Something as simple as smart street lighting, lighting that dims when no one is around, is already being rolled out from France to North America. In the US, the potential savings from this are estimated to be more than $1bn per year, not to mention the advantages for the environment.
The promise is that companies and authorities, after the initial capital outlay, could save millions through more effective management of services.
More exciting, however, is a better utilisation of existing infrastructure.
“5G enables vehicle-to-vehicle communication, and vehicle-to-infrastructure communication: that’s the fundamental base not only for the full optimisation of traffic flow, but also for the prospect of autonomous driving, because of the safety improvements and the interaction it enables between vehicles,” he says.
“The impact of that on society will be massive. More than 1,600 people die in the UK from road accidents a year. Approximately 1.6% of the European Union’s GDP is lost every year from traffic. And that improvement in journey efficiency will have its own knock-on effects, such as on the 20,000 deaths in Mexico City each year from air pollution from vehicles, which will also in turn see a big fall from the increased use of electric vehicles.”
5G enables vehicle-to-vehicle communication, and vehicle-to-infrastructure communication.
Infrastructure - what's needed where?
Towering demand means more masts
When it comes to ensuring comprehensive outdoor 5G coverage, the key is transitioning towards a higher density infrastructure network, more reliant on closely spaced street-level telecoms transmission antennae. This is in contrast to the current, more spaced out, network of taller (but relatively farther apart) outdoor telecoms towers and masts, which cover larger areas, but less reliably, and which are more likely to have coverage blackspots, where buildings get in the way, or fail during sudden high demand, from lots of users in an area.
Because of the density of demand and development in cities, urban outdoor network kit is typically less about the sorts of masts sitting on the edges of fields that support rural and suburban coverage, and relies much more on masts on high-rise rooftops (or relatively less tall towers standing on several-storey shoulders).
“To give you an example of what this means in practice, think of how a mobile operator tries to cover an entire city. They put what we call microcells onto big towers to collect the traffic from the customers and then share to their core network,” says Jose Antonio Aranda, Innovation & Product Strategy Director, at Cellnex.
“However, in areas where there are a lot of people in the same place, that traffic is too much and the cells are not able to serve all the demands of the customers in that area. That's why you need to put smaller cells that you can put every 100 metres, or every 50 metres, depending on the configuration, and collect all this traffic.”
Cities will need those smaller cells in place to support the sheer torrent of data demand 5G will unleash in densely populated areas. McKinsey analysis projects average data traffic between one and two petabytes - a million gigabytes) per square kilometre across major cities - a category it mentions Manhattan, Helsinki, and Hong Kong’s Kowloon district in the same breath for - by 2025.
That same McKinsey analysis found current typical European urban demand levels of 0.5 petabytes per square kilometre rely on networks built on a density of a cell less than every 200 metres apart. So a four-scale increase in how much data the network will need to handle will need that average to fall to less than a 50 metre gap between each cell, just to handle the data needs of maintaining current 4G coverage levels.
Given how much more important comprehensive reliable coverage will be for the many more use demands driving up to a quadrupling of traffic, we can expect the practical average cell density needed to make coverage blackspots a thing of the past to be even lower still. The estimated 500,000 cells needed to make all 1,569 square kilometres of Greater London 5G-ready implies an average density of a cell every three metres. Fantastical as it sounds, given 5G will rely on a mix of mast-type macro cells and street-level small cells, it implies a density likely equivalent in practice to having a
small cell on every other one of London’s 700,000 lamp posts
.
The importance of neutral hosts
Numerous companies are now acting as neutral, multi-operator hosts that invest in network coverage infrastructure that all of the mobile operators can use, instead of each operator having to install their own mast or internal network that only provides their network.
Secular growing demand for their product, both universal quality wireless coverage, and multiple operators for the kit they build, is drawing investment into the sector in the form of patient, long-term, capital which recognises the value this market offers as a safe bet for low-cost returns over a several-decade horizon.
What is the advantage of a neutral host?
Originally mobile operators rolled out their own infrastructure networks to give themselves competitive advantage. Over time, as coverage has become complete, they’re now turning more towards neutral hosts, as they lower their economic costs and help them reach more challenging areas, such as remote rural locations, and roadside and rail track connections. Independent outdoor infrastructure is much more efficient in terms of connectivity and location: a
recent report for the European Wireless Infrastructure Association
found independent masts are shared by an average of 2.4 operators, compared to 1.3 for network-owned towers and are, on average, 40% more efficiently located.
Neutral hosting also aligns with the Government’s goals for the market. The Department of Culture, Media and Sport’s Future Telecom Infrastructure Review identified encouraging competitive infrastructure models as a priority, and specifically name checked the neutral host model to that end. The European Wireless Infrastructure Association report also estimated independent operators will deliver efficiency savings of over €30bn in the European market by 2029.
What proportion of outdoor infrastructure is provided by neutral hosts?
Outdoor, globally about 60% of network infrastructure is provided by independent, neutral hosts, but only about a third of it is in the British and European markets. In the UK, there are about 36,000 mobile sites, with about 10% of those owned independently.
What does indoor network infrastructure typically require?
For indoor small cell infrastructure, it’s made up of antennae scattered throughout the venue that propagate the signal, and the subsidiary remote units that amplify it. Those antennae are connected with cable infrastructure to an equipment room which provides the signal being, in turn, connected to the mobile operators’ radios. That altogether provides dedicated coverage to a venue, unaffected by the outdoor signal and shareable between operators.
What are the considerations involved in providing network infrastructure?
For indoor venues, the two key things to keep in mind are coverage and capacity. Coverage is essentially ensuring that all parts of the venue are covered. So, to take a football stadium - that means making sure it comprehensively reaches all parts, not just the terraces and the corporate hospitality areas, but also making sure people aren’t left with one or two bars of signal and a patchy connection in the concourse and the food courts.
But vitally, that’s nothing without capacity. You may have all the parts of the stadium covered, but can it manage 50,000 people all using their phones on match day? When you have to provide for that many people, you can’t just rely on picking up an outdoor signal and pumping it through your indoor network. You need the operators to connect their radio base stations, which go back to their core networks, up to your indoor infrastructure to guarantee that dedicated service is available and doesn’t get congested.
The underground network underpinning over ground coverage
But all of the 5G network will be dependent on mass fiberisation, upgrading the UK’s underground telecommunications cable system from its current copper standard to the fibre optic wiring needed to sustain the exponential leap in data traffic demand and the necessity for seamlessly reliable coverage.
This doesn’t just mean getting more homes and buildings upgraded to fibre optic cabling, and connecting more of them up to the underground tunnel network.
As Cellnex’s Jose Aranda points out, the entire envisaged dense network of small cells covering the cities of the future will need to be hooked up too. “Right now, not all the antennas are covered by fibre. But with 5G, every antenna will need to be connected with fibre in order to cope with all the traffic each one will collect”.
The question of what and who could drive these cabling improvements is, however, potentially more interesting than the obvious debate of who should pay for all of this improved infrastructure.
It would be reasonable to expect Openreach, a wholly owned subsidiary of BT Group which owns the bulk of the UK’s underground cable duct tunnel network to take the lead in delivering the copper to fibre upgrades equivalent to turning the ‘roads’ of this national data communications system into motorways. The operational significance of this is that BT Group, while funding the roll out, has no influence over how that money is then spent once given over.
However, changes brought in by OFCOM in September 2018 mean that Openreach no longer has a competitive near-monopoly on cabling upgrades from owning so much of the network. The regulator has opened access to Openreach ducts to MNOs, meaning providers, typically more associated with over ground wireless infrastructure, are likely to play a much bigger role in delivering full fibre upgrades to the underground network than they would have been able to otherwise.
There are two parts to the 5G infrastructure piece cities need to consider: the first is outdoor network coverage, ensuring wireless signal is in place to cover as much distance and as many people as possible. This will involve not just installing the telecommunications masts and towers many are already familiar with, but also a dense network of ‘small cells’ - hundreds of thousands of small, street-level antennae (typically on the backs of lamp-posts) across a city, to support the massive data needs of 5G applications and explosion in the number of mini smart devices hooked up to provide them.
The second is wiring up buildings and antennae to the 5G network, by upgrading existing underground cable networks to fibre-optic cable that 5G depends on.
"People are putting their heads in the sand….this is happening, the legislation is in place, and we have to embrace it. We all need connectivity."
Belinda Fawcett,
General Counsel and Director of Property and Estates, Cornerstone Telecommunications InfrastructureIncreased rural and suburban data demands of 5G can probably be supported with more towers in more fields in the middle of nowhere and all depends on the degree to which infrastructure is shared in the UK. In the UK we are now moving towards a model where infrastructure in total and partial not-spots is shared between all four networks. But the unavoidable need for more rooftops to be taken for increased city cell density means needed urban 5G infrastructure installation will impact much more on the sorts of landholders with the financial muscle to own a high-rise building in the first place and, importantly, make a lot of noise and hassle if they don’t want a 5G mast on top of theirs.
"Network design in cities is a very different proposition to rural areas. The focus is not simple provision of coverage, as it might be in a rural area."
bt group
Local councils, which between them also own significant stretches of the duct network, can also take a lead in driving fibre upgrades. Estimates of the exact proportion of the network owned by the likes of Openreach and local councils aren’t possible, as up-to-date records on which parts of the network are operational and how much of a given duct’s capacity is being used aren’t collected. The National Infrastructure Commission has held up as best practice the approach of local authorities such as Aberdeen Council, who changed their procurement process for upgrading their network cabling to favour the tender offering the most comprehensive, future-proofed wireless coverage across the city, rather than the one bidding the highest amount for access to their duct network.
The Aberdeen example also highlights one other potential major driver of fiberisation:
the demand side
. Fundamentally, the sheer range of potential applications of 5G means that trend is going to be towards occupiers across sectors – office, retail, or industry, treating 5G connectivity as a basic utility demand in coming years.
Major land and property managers, such as the Canary Wharf Group are, rightly, positioning themselves on the lightning-fast universal seamless connectivity their 5G-connected estates will offer potential tenants. It may well be that sheer competitive preservation becomes more of a pull-factor than anything else in evolving the map of UK fibre optic cable coverage from one resembling the early motorway system to one resembling the UK’s economic nervous system.
I've Got the Power – The Importance of Code Powers
When it comes to installing telecommunications infrastructure in the UK, there’s only one game in town: the new Electronic Communications Code (EEC). Introduced in December 2017. The Code governs the relationship between MNOs and landowners when it comes to siting and finding the land for the masts, cables, antennae and kit cabins needed to provide wireless networks.
OFCOM-approved MNOs are awarded ‘Code Powers’. Importantly, and this is the subject of not inconsiderable friction between landlords and MNOs, Code Powers give operators the right to requisition land, such as roof space to install telecoms infrastructure. This is akin to a compulsory purchase order, except along the lines of a lease - the operator doesn’t own the land but does have to pay to the landholder for the space.
How land valuations work under the New Code
The old Code, which the new ECC replaced, typically allowed landowners to be rewarded for allowing infrastructure to be installed in their space (although in certain circumstances they did have to foot the bill). However, in line with the Government’s priority for increased national connectivity, the new Code has given much more power to MNOs when it comes to requisitioning space, and established provisions allowing them to do so on much better terms.
The perspective for landowners and PDRs
The new Code has polarised the landlord and operator community – perhaps not surprising when it represents a significant change in the industry. But given the insatiable consumer demand for bigger/faster/better connectivity and download speeds, this is the Government’s answer to assist the operators in rolling out Digital Britain.
A measure of this polarisation the new Code has engendered is that the old Code, which had been in place since 1984, saw relatively few cases ever brought to tribunal, arguably because of the ambiguous and complex way the first Code was written, together with impractical enforcement methods. However, in the 18 months alone since the new Code was introduced, 9 cases have been judged by the tribunal, with over 70 applications having been lodged.
To those familiar with recent trends in real estate and what tenants want, it’s not hard to see why there is an issue. The rooftops MNOs often need for this stuff are hot property. Secret rooftop cinemas, sky gardens and penthouse terraces are all the rage in big cities, giving landlords the opportunity to command premium rents in line with the reliable commercial draw these sorts of amenities offer.
A low offer might provoke an objection, particularly if a landlord has ambitious plans for its rooftop but that would then lead to a fair discussion of alternative use value.
Observers may reasonably ask what the practical upshot of this friction between the property and mobile operator world is for getting the infrastructure in place for 5G, if MNOs largely have carte blanche over getting the land to put the kit where it’s needed. While this is the case, if landlords don’t agree to a new site acquisition or an upgrade of an existing site, that may cause the MNOs to take cases to the tribunal.
Some relief is potentially on the horizon. The Ministry of Housing, Communities and Local Government has launched a consultation on introducing Permitted Development Rights (PDRs) for 5G infrastructure. These are the same planning rights that have seen a wave of office buildings converted into housing this decade, by fast-tracking applications for developments so long as they aren’t in violation of certain provisions (e.g. adding flood risk).
This will also have some benefits for landlords, as it will be easier for operators to move to alternative sites - and remove the hold-up to the process they pose for landowners redeveloping space being used for infrastructure.
In the meantime, some city leaders have taken a lead in easing the process and averting set-tos between MNOs and private landlords, by offering up public sector roof space - where commercial imperatives tend to be less pressing than they are for private landlords. The Mayor of London, Sadiq Khan, released a
standard agreement in September
for operators to use in applications to use public space for infrastructure, as part of a plan to address the city’s ‘not-spots’ and streamline 5G rollout.
The case of
EE Limited and Hutchison 3G UK Limited v London Borough of Islington
was precedent-setting and provided clear guidance from the Upper Tribunal as to the expected consideration and compensation for New Code agreements, particularly where it can be successfully argued that the proposed site has no alternative use.
The Upper Tribunal in the case of EE Limited and Hutchison 3G UK Limited v London Borough of Islington, focused principally on the issue of consideration and compensation under the New Code, as the Respondents lost the opportunity to challenge the majority of the terms sought by EE/H3G due to their failure to adhere to the UT's directions concerning amendment of the travelling draft agreement and the preparation of a clear schedule of disputed terms for the UT to review. A clear warning to litigants that the UT expects its directions and timetables to be adhered to.
The case involved a rooftop site in Central London, on which EE and H3G sought to install new telecommunications apparatus, in order to maintain coverage in the local area, following a neighbouring site being decommissioned.
Prior to the New Code coming into force, the parties were negotiating terms for an agreement in respect of the site, for which the annual rent of £21,000 per annum had been discussed. However, no agreement was concluded prior to commencement of the New Code, and as such negotiations resumed in early 2018. Paragraph 20 and 26 Notices were served on the Respondent on behalf of EE and H3G in summer 2018, seeking interim access to build the equipment, and a permanent agreement for a ten year lease of the site.
Throughout the course of the proceedings, the Respondent failed to comply with the various directions, and as such the Tribunal debarred the Respondent from disputing any of the Claimants' proposed terms at the final hearing, with the exception of consideration and compensation. At the final hearing, the Tribunal heard experts for both parties giving evidence on those valuation points, the gap between the parties' positions being significant, both in terms of the level of annual consideration payable and, perhaps even more significantly, the compensation that should be paid to the site provider.
The Claimants' argued that minimal consideration should be awarded, as the site had no alternative use and thereby nil market value. The Claimants' did, however, agree that they would honour their offer of £2,551.77 (covering both compensation and consideration), which was an open offer made prior to commencement of proceedings. In contrast the site provider sought annual consideration of £13,250 p/a, as well as raising a very wide range of potentially compensatable losses, albeit that very few of those were quantified.
The Respondents were largely unsuccessful in their arguments both in terms of consideration and compensation. The UT was unimpressed with the Respondents' experts novel attempts to introduce old Code comparables by the back door, and was equally dismissive of the speculative heads of compensation raised by the same expert. The UT ultimately awarded minimal annual consideration of £50 per annum, plus £950 annual payment towards the service charge of the building. Other potential claims for compensation was reserved, requiring the Respondent to prove such losses and to apply to the Tribunal at a later stage, should they incur the same.
EE Limited and Hutchison 3G UK Limited v London Borough of Islington
The tribunals that settle disputes between operators and landlords have listened to MNOs since the new Code came into force.
As long as operators can prove, among other things, public benefit, the new Code gives them the power to appropriate space for much lower rents than previously. The tribunals that settle disputes between operators and landlords have listened to MNOs since the new Code came into force. The new Code’s prioritisation of fast and cost-effective rollout of 5G infrastructure limits the defences landowners can cite to refuse land access to operators, and makes it much harder for them to hold operators to ransom by demanding higher rents for access.
Smart Roads and Smart Vehicles
Automated vehicles, traffic management and transport
Every person and their dog is developing a self-driving car, and the likelihood is they will be here sooner than you think.
Driverless cars will ultimately generate huge swathes of data (4TB per hour), according to O2. 5G’s seamless connectivity will be crucial in processing this data.
Enabling the self-driving society will require a wholesale effort to install a comprehensive nationwide network of roadside 5G infrastructure. That involves nothing less than the installation of millions of small cells tens of metres apart, each providing limited but reliable coverage to chain a seamless pathway of connectivity.
But the benefits are tangible - safer, less congested roads and a fundamental change to not just how we use the roads individually, but for commercial users like lorries.
5G-enabled smart roads will be able to deliver traffic improvements through sensors enabling things like more instant rerouting after accidents and dynamic speed limits so, for example, road authorities can force cars ahead of tailbacks to go slower, allowing congestion to clear before they reach them.
All in all, Highways England estimates that smart motorways improve traffic capacity
by up to a quarter
. In simple terms, a stretch of non-smart road that can currently only fit four cars during rush hour will be able to fit a fifth.
Tony Gosling, Chief Digital Officer at Pell Frischmann is helping with the design and roll out of smart motorways in the UK.
“The technology for autonomous vehicles is coming along fast. While there are a whole bunch of issues about doing it in practice, in principle a Tesla today can drive itself down the street.”
He points to the Department of Transport already testing connected roads along the A2/M2 corridor, which is studying what kind of information needs to be piped from roadway to vehicles, and what kind of capacity that needs. However, the infrastructure, and whether it will ultimately be Government or private telecoms providers taking the lead in installing it, is still some way from being decided on.
Highways England, however, has already committed to installing the necessary improvements on certain stretches of the road network, such as a 32-mile stretch of the M4 between London and Theale in West Berkshire - where investment of £27 million per mile will see one of the busiest stretches of the UK motorway network made smart and AV-ready by 2022.
And, imagine if all long haul haulage was done at night – now possible due to autonomous programs that don’t fatigue. That would mean less use of motorways during the day, freeing them up for the general public.
Essentially, rather than having to build new transport infrastructure, we might be able to double or triple the capacity of what we already have.
However, joined-up thinking across sectors and cities will be required.
“When we look at the economics of people collaborating across spaces, we want them to be able to work while they travel. The sweet spot is people being able to collaborate across cities, without feeling barriers,” says Henri Murison, director, Northern Powerhouse Partnership.
“If the North of England is going to be a virtual city by 2050, it needs to happen in all the cities. The really key point is ensuring we have those corridors, to ensure continuous connectivity between cities, not just in them.”
Overseas examples indicate collaboration between public and private sectors will be vital in establishing 5G smart road networks. In Finland, for example, homegrown household name Nokia has taken the lead in establishing prototype networks in rural areas and test bed smart cities, while the government has taken the lead in Switzerland’s urban-focused 5G network, launched in May this year, and in China which is set to roll out functioning smart highways early next decade.
Bridging the Urban – Rural Divide
The government must be willing to connect all parts of the country equally, to avoid the creation of haves and have-nots. Over the past 20 years, £45 billion has been spent on new mobile infrastructure, and £30 billion on spectrum licences. Despite this, 9% of the UK’s geographic area is not currently covered by any mobile network, let alone 5G.
In the view of the BT Group, there is a straight-forward explanation for why there are still parts of the UK with total gaps in network coverage: “Simply, the upfront and operating costs can’t be met by the demand for mobile services that is present in these areas. The mobile sector has made a clear proposal to Government for how this gap could be closed as part of its vision for a ‘Shared Rural Network’. It makes clear that public funding will be necessary to close that gap."
There is, at least, some solace for the UK. Boris Johnson’s first speech outside Downing Street as Prime Minister pledged a rollout of fibre connectivity across the country, referencing the digital divide and the importance of democratising high-speed internet access as a way of closing national inequalities.
And on international comparisons, the UK is actually one of the leaders for reducing the digital divide within its own borders, with only a two percent difference between national and rural penetration rates for fixed broadband access in 2014 - with
86% of rural households connected
, ranking the UK joint second among major nations in the EU with Germany, behind only the Netherlands.
“The government acknowledged in the Future of Telecoms Infrastructure Review that for around 15% of rural communities there is no commercial viability without government support, and it set up a fund to help the private sector bring fibre broadband to those communities,” says Marija Simpraga, Infrastructure Strategist, LGIM Real Assets.
“As 5G rollout gets under way, disparity between quality service in rural vs urban areas will become more pronounced and difficult to justify. This could increase the political incentive to put measures in place to improve coverage in underserved areas.”
Drivers bridging the gap
A strong driver of bridging the urban-rural gap could be the potential to increase democracy and community involvement.
The better communication, better connection and the ability for faster notifications 5G enables could change the planning process specifically. An open data culture allows the democratisation of decision-making.
For example, for new infrastructure and housing, politics often affects planning, and government decisions are made because an area is marginal vote, not because the infrastructure would not be valuable.
Being able to connect all members of the community, being able to grant them open data access, and being able to demonstrate to them in more quantifiable and measurable terms how a new development would contribute to the community would make a huge difference in the planning process, and in democracy in general.
As 5G rollout gets under way, disparity between quality service in rural vs urban areas will become more pronounced and difficult to justify. This could increase the political incentive to put measures in place to improve coverage in underserved areas.
"Network design in cities is a very different proposition to rural areas. The focus is not simple provision of coverage, as it might be in a rural area."
bt group
Andy McVeigh
5G lead for Addleshaw Goddard
Andy is the 5G lead for Addleshaw Goddard. He is a partner in our Construction team and heads up the firm's student accommodation team.
INSIGHTS
INSIGHTS
The paradigm of increased connectivity
INSIGHTS
The Kit Cities need: The BT Group View
INSIGHTS
Don’t treat telecom operators as an afterthought
INSIGHTS
Connectivity Through Service Stations: Extra Motorway Services Area Group
INSIGHTS
The Place of Local Government: Mid-Sussex Council
INSIGHTS
The capacity needed and its potential: Hitachi Vantara
INSIGHTS
The View from Hangzhou: how a Chinese City approaches 5G
INSIGHTS
Cellnex Telecom: Transmission Re-Vamped
The Kit Cities need: The BT Group View
Q.
You are leading the way in deploying 5G with some very clear benefits for consumers and businesses. What are the main technical barriers you face in deploying 5G in cities? How do these affect the various metrics of performance (e.g. speed, bandwidth, latency)? And to what degree will some types of location have better 5G performance than others? We’re interested here in explaining how the physical environments we have need to be adapted in order to share best practice with the real estate world. A.
Network design in cities is a very different proposition to rural areas. The focus is not simple provision of coverage, as it might be in a rural area. Instead, network operators need to determine how to deliver enough capacity to meet the far higher levels of demand that are experienced. As a result, the overall volume of equipment and specific site locations is much higher in major population centres than elsewhere.
This capacity challenge becomes particularly acute within urban areas where large numbers of people gather. Good examples include train stations or major sporting and/or entertainment venues. In these places, site density needs to be even more geographically dense. Equipment must be sited on whatever available structures or buildings there are. For most city centres, this means rooftops.
The next challenge is around the different propagation characteristics of the radio spectrum being used. 2G, 3G, 4G and now 5G networks all either already do, or will in the future, use different radio spectrum bands to deliver connectivity. Because of this, antennas must be in very specific locations to avoid the performance and coverage of masts using differing technologies being affected.
In addition, new buildings completed after antenna begin operating can create a ‘shadowing’ effect which also impacts network performance. This can mean a much higher requirement in urban areas for antennas to be moved around and/or upgraded than is the case elsewhere. Regular access to sites becomes much more important and new development can, in turn, impact that access.
Finally, urban areas tend to see higher volumes of ‘Notices to Quit’ (NTQ) issued by landlords than rural areas do. NTQs are typically issued if the landlord has some alternative use for the building or location which hosts a mobile site. An NTQ will generally mean complete relocation of all the equipment on a site, which can in turn lead to the ‘propagation impacts’ described above.
In sum, urban network design is not just about ‘building’ the network, which is complex in of itself. There is a constant stream of upgrading, testing, assessment and modifications needed to ensure current demand can be met, and future demand catered for. All of that requires physical access on an ongoing basis to a given site location, and a landlord who understands and is prepared to facilitate that need.
Q.
Is it technically possible to use major infrastructure projects – such as road and rail – to enhance 5G deployment? Has this been considered and what difference would it make if new motorways and new railways were integrated with 5G-supporting technology? What physically would need to be done, or would it better to direct funding to upgrading existing infrastructure?A.
In general, major infrastructure development will naturally generate demand for new mobile infrastructure. A new motorway will, for example, generate more traffic and therefore more users within a given geographical area. 5G’s potential application for interconnected vehicles is likely to intensify this demand. But perhaps the key challenge faced lies in supporting concentrated demand where new rail lines terminate. For example, Crossrail in London will generate thousands of new users coming through a single point at rush hour. That, in turn, requires substantial numbers of new antennas to be located nearby.
Beyond that, provision of 5G connectivity can be promoted through early engagement with network providers on the locations and characteristics of whatever infrastructure project is under consideration. This already happens with major housing schemes or major commercial projects. Experience has shown that network deployment is received far more positively by local residents, and encounters less planning related issues, if it takes place alongside new development.
Such engagement can help to avoid a key risk: that major infrastructure is developed in a way that doesn’t align with current network plans or has characteristics that directly impact 4G and 5G network provision. For example, motorways and rail lines can be built with numerous tunnels or within cuttings. These are often network ‘not spots’ by default unless network providers are involved from the outset. Even if they are, addressing such issues are complex and require close collaboration. For example, broadcasting a signal into a tunnel portal entrance requires an antenna to be placed at a very specific location at the right height. That need must be balanced with wider considerations, including the safety and ongoing operation of the rail line or road.
Infrastructure developers also need to think carefully about how individual buildings are designed and built. At present, 5G signal has difficulty penetrating large concrete structures with insulated glazing. This means, at least initially, that new 5G infrastructure needs be located inside such buildings to ensure users can receive services when they are also located within them. This requires consideration at the design stage. Delivering 5G coverage in this environment needs space, an operations room, dry riser access and early survey work by network operators. The earlier this is considered by an architect, the lower the cost and timescales associated with provision of connectivity later on will be. The situation may change once new 5G spectrum is auctioned by Ofcom next year.
In our view, one way to reduce such risks could be through insertion of relevant planning conditions within decision notices whereby developers need to consult with all network operators, including mobile ones, in the course of development. As matters stand, most conditions normally only refer to fixed network providers. This would provide a direct incentive to ensure solutions are developed early on rather than retrofitting equipment at far greater expense later.
Q.
On a technical level, how do the energy requirements of the infrastructure you are installing for 5G differ from existing 3G and 4G infrastructure? What are the needs and how are you working with energy providers to address these needs?A.
Telecoms equipment has comparatively low energy requirements to other typical features of large buildings. Air-conditioning units, lift systems and heating/ventilation systems all generate far higher usage. Within city centres access to the existing power networks is well understood and generally routine. Mobile infrastructure on buildings has access to the landlord’s supply, with a separate meter unit logging energy use. When planning new network deployment, an operator will generally assume that the current power provisions and agreements are suitable. There will also be an annual assessment of each network’s power usage to monitor requirements at the whole network level. Energy markets are also monitored and agreements made in anticipation of market fluctuations.Q.
How does network slicing work and how important will it become in the public realm? It’s one to stream music on a street corner, but quite another to connect hundreds of cars and street-level sensors in a small area. What will be needed to enable all this to happen?A.
Network slicing will become increasingly important in the converged networks of the future, allowing ‘virtual’ network links with specific characteristics to be created on an agile, dynamic basis according to customer needs. In a world where we have, effectively, one network, network Slicing gives us the option to create virtual networks within that overall network infrastructure. These ‘slices’ can be optimised towards specific characteristics in an agile way.
This capability has several specific applications. For example, it allows for the creation of dedicated low-latency network slices for health, virtual reality or gaming applications, or high-bandwidth slices for 4K and 8K broadcast transmission. This will support our efforts to efficiently deliver the digital services that customers will want with the Quality of Service (QoS) and network monitoring they need. These improvements will take time to come on stream as this is still an emerging technology area, but the research team at the BT Labs are pushing the potential of this technology, working with our vendor partners.
Q.
Given only one percent of commercial buildings are “new” what can owners of existing buildings do to ensure they are not left behind? What are some of the common mistakes people make in how they think about planning for 5G? What should people be doing now?A.
One fundamental step that existing owners can take is to familiarise themselves with, and commit to, reaching agreements with network operators under what is referred to as ‘new Code terms’.
Most agreements to use a site for mobile infrastructure are reached under the terms of the Electronic Communications Code (ECC). In December 2017, a new ECC was introduced under the provisions of the Communications Act (2003). While the Code itself is statutory in nature, it is accompanied by a non-statutory code of practice that governs the way agreements should be reached between provider and landlord. The aim of these changes (often referred to as ‘new Code’) was to make it easier for network operators to install and maintain apparatus such as phone masts, exchanges and cabinets on public and private land.
The new Code recognises the need for each operator’s network to be extensively upgraded and reconfigured on a regular basis. This is expensive and time consuming. Operators will generally prefer to deal with landlords who are prepared to enter into agreements on new Code terms, as this allows them to reduce the time to deployment, releases capital to invest in more equipment and provides the necessary coverage that the landowner wishes for.
The new Code also embodies a wider philosophical shift on the part of Government that connectivity is of key social and economic importance, so operators need improved access rights. Increasingly, hosting a mobile site is not purely a revenue generating activity, and is instead a means to benefit indirectly from access to the technology that the new site enables. We are keen to see a more general shift from landlords as whole towards this view, as it will help to ensure swift network deployment across wider areas, which enhances the wider economic benefits that 5G will bring to them.
Q.
When it comes to installing the masts and cells required to support rollout, how does BT work with local councils and property owners and are there things the Government could do at a policy level to make it easier, either from a planning perspective or when it comes to potential tax incentives? We’re interested in being able to make recommendations about anything that could accelerate roll out, for instance some form of established partnership between the public and private sector.A.
At least initially, BT is deploying 5G networks through existing mobile sites already used for 4G. Given this, much of the discussion with property owners is about measures that may need to be taken to upgrade those sites takes place through MBNL, which is a joint venture between BT and CK Hutchinson, who operate the 3 network, and generally manages much of the wider network infrastructure as well as most new site deployments. We also work alongside appointed agents who manage the process of any new site acquisition, maintenance and upgrades. These agents and/or MBNL will also handle any planning applications that need to be submitted for individual sites and liaise with landlords and owners accordingly.
BT’s direct relationships with council leaderships are handled by a series of dedicated regional liaison teams. They consider our relationships with local authorities, alongside our role as major local employers, innovators and investors in local areas.
In supporting rollout, the Government is already considering a suite of measures that will increase scope for application of PDR across a wider range of the works necessary for upgrade or delivery of new mobile sites for 5G. These are currently being consulted on. If they become policy, implementation will require new secondary legislation. Eventually, we hope these changes will simplify the process for installing new equipment and existing upgrading masts and sites to 5G. In rural areas, they should also support lower numbers of masts being necessary to provide 4G and 5G coverage through allowing greater scope for those masts to be higher than is often permitted under the current planning regime.
Longer term, the Government will need to seriously consider applying the same approach to supporting roll-out of mobile networks in areas that are not commercially viable as it historically has for fixed broadband networks. The efforts of the private sector to date should not be underestimated. Over the past 20 years, £45 billion has been spent on new mobile infrastructure and £30 billion on spectrum licences. Despite this, 9% of the UK’s geographic area is not currently covered by any mobile network, let alone 5G. This is simply because the upfront and operating costs can’t be met by the demand for mobile services that are present in these areas. The mobile sector has made a clear proposal to Government for how this gap could be closed as part of its vision for a ‘Shared Rural Network’. It makes clear that public funding will be necessary to close that gap.
The paradigm of increased connectivity
Christopher Choa
Director of Cities at AECOM
The massive bandwidth and low latency of 5G suggests we will have engaging meetings with family, friends, and co-workers without needing to be physically present, even if they are hundreds of miles away.
Theoretically, because communication will be so vivid, we could have more virtual working and less need for face-to-face exchanges, which in turn might reduce demand for city centre locations. Perhaps this will fundamentally alter our built environment.
But we are probably misunderstanding the promise. Here’s what’s more likely: we will experience the phenomenon of induced demand; whenever supply increases, we consume more of it.
Let’s say that for work, the average person regularly relates to a casual tribe of 100 people, with 10% of those relationships – a more important subset of ten people - satisfied on a more personal face-to-face basis.
With 5G, we might engage many of those ten important face-to-face exchanges by immersive video. If we used to regularly travel into work every day of the week, wouldn’t we easily cut down our office commitment – maybe even down to one or two days a week?
Probably not. 5G will not reduce the desire for urban density or support the suburban or rural-living dream, because it will never replace our very human desire to socialise in person.
But we cannot assume that our future world will have the same number of interactions as we have now; 5G will induce demand for many more interactions, which will in turn increase the need for social presence. If we are real-estate investors, tomorrow’s 5G communications might suggest weaker land values in the short term. But in the longer term, as we gradually increase the number of our casual contacts by orders of magnitude, we create scarcity; those land values will remain strong.
Don’t treat telecom operators as an afterthought
Belinda Fawcett
General Counsel and Director of Property and Estates, Cornerstone Telecommunications Infrastructure
https://www.cornerstone.network
Cornerstone operates over 25,000 sites across the UK. The company acquires, builds and manages sites on behalf of Vodafone and Telefonica (O2) who share the sites and install their own active equipment to provide mobile connectivity in the UK.
Interview
Q.
What is the argument for having separate ownership and operation of the infrastructure?BF.
The main purpose behind setting up these JVs to own and manage the infrastructure was to reduce costs for the Operators, to allow them to reinvest in the network.
The ECC legislation was also introduced because the cost of running the infrastructure and providing coverage, all while trying to meet government objectives in terms of rural coverage, was rising exponentially.
All four operators used to have their own infrastructure, with sites often side by side, and we're all paying the same amount of rent. So, it made sense to combine them and share the cost.
Additionally, there was also a lot of environmental pressure not to have too many masts and the government supported more sharing.Q.
How many sites do you operate? BF
.
We own and manage around 25,000 sites across the UK. We have infrastructure on rooftops, on greenfield sites, and street works. And there are small cells, or microcells, as well. We work with around 12,000 individual landlords. Some are farmers and rural landowners, and some are larger, multi-site providers such as Arqiva.Q.
In terms of Code powers, have they slowed down the planning process? Are proceedings getting log jammed in tribunals and legal back-and-forth?BF
.
The myth that's out there says that operators have been hugely aggressive, but that's not true. What we're doing is exactly what the government wants us to do, which is to try and take cases to tribunals to seek the clarity that everybody needs to make this whole Code work. People simply aren't engaging because of the devaluation issues, which is the main sticking point.
There's a misconception that we're taking everything to tribunal. We are negotiating consensual deals but unfortunately there seems to be a concerted effort by some in the landlord community to try and scupper the success of the Code. That's making things quite difficult for us.
To expel the myth, out of thousands of sites where we're looking to either renew or acquire new sites, we've got less than 100 where we have served paragraph 20 notices, and less than 20 which we've taken to tribunal.
Ultimately, the very intention of the legislation is to reduce the rent that we pay for a site, which was becoming untenable. The cost of rolling out the rural network with the rents that were being charged was unreasonable. The legislation sets out how to properly value a site and agree the compensation, and we're following that valuation mechanism. There have been a number of tribunal decisions which have given good guidance to us in terms of how someone might value a site, and we're following that and changing our approach as the guidance comes out. This will hopefully provide the clarity that all parties need.
It's easy to forget that this is all very new. It's a recent piece of legislation and is pretty ground-breaking stuff, and not the easiest piece of legislation to interpret. That's why we're really trying to lead the way in getting the clarity that the government has asked for by taking these cases to tribunal. It's not easy, because of the work that's involved in doing it, but unless we do, we're not going to move forward. I think what we really need from the property industry is some support in this, in working with the government, and looking at some test cases. This isn't just down to us because we don't know how the tribunal will determine things, but we believe it will at least give us all clarity and will stop this ridiculous impasse.Q.
So what’s your advice to the property industry then?BF
.
People are putting their heads in the sand among the property industry and are in some circumstances being advised to just ignore this problem until it goes away. But I say don't ignore it. We can't ignore it. This is happening, the legislation is in place, and we have to embrace it. We all need connectivity. We all know that rural areas need better connectivity, and even London needs better connectivity. If you go to any other European city, you often get better coverage than we do in London, and that's because of the nuances of how our property industry works. The property industry should recognise that they have an opportunity to take a leadership role in driving the code legislation that can benefit the public. We need to work together to try and get this moving.Q.
Does the property industry feel that they are subsidising the profits of telecoms firms?BF
.
Well, if you turned it on its head and said to a property developer that they needed to build a 25,000 square foot office block in the middle of the highlands, what would they do? I don't imagine that they would want to do that, and they'd certainly want some support, help, or compensation as they would be unlikely to get a tenant willing to pay a commercial rent to get pay back on the investment. The costs of installing the infrastructure necessary to support ubiquitous coverage is huge. For example to put the fibre in on a site in the highlands was going to cost nearly a million pounds. That mast was only serving a small area mostly occupied by a few hundred sheep. You're never going to get a return on that, and that's been recognised by the government and that’s why the legislation was introduced to encourage that investment. There's a very small percentage of sites across the UK that are profitable.Q.
Isn’t the main problem with the Code that it’s a barrier to redevelopment? It stops people going about their lawful business.BF
.
We absolutely acknowledge that things can be delayed, and there's never any intention to do that. We want to work with landowners, and one of the things we are asking is that they engage with us earlier. We often find that landowners treat telecom operators as an afterthought. We want landowners to talk to us and give us as much notice as possible, as it's often quite hard for us to find alternative sites. If the property industry helped us more, we could perhaps move elsewhere temporarily while redevelopment goes on, then return once it’s completed.
That’s how we want to see it working, and our understanding of the legislation is that if there are redevelopment plans by a landlord, then they give us a time frame within which we have to move elsewhere.
Q.
It’s quite a long notice period isn’t it? You get 18 months, then another further period to vacate.BF
.
It is, but that doesn’t always make it easy. If we have to get off a site it isn’t as simple as locating another retail unit, for example. You might need to get three replacements to be able to find the same level of coverage. It's quite hard in the city or in the West End to find that, particularly where you've also got a lot of redevelopment taking place anyway. So, 18 months probably seems a long time for the developer, but for us, that's actually not very long considering what we have to do to find the site, get the planning, get the fibre to the site and do everything that we need to.
But also, I would argue that redevelopment plans don't just start 18 months before a site has to be vacated. My issue is that we are the last people to be engaged. If you've got tenants in the property, the owners will go to the tenants inside the building and serve notices. My ask is to not forget us, let us know as soon as possible of any intention to redevelop. We do have a risk register, and the minute that we know that something is happening, we will begin the search to find an alternative location.
Q.
But you find that dealing with the public sector is relatively easier than dealing with the private sector, which is somewhat ironic.BF
.
The private sector are reluctant to host telecoms infrastructure on their properties, while local authorities are looking at the wider benefits it’s going to bring to the communities from an economic, social and environmental aspect.Q.
To what degree is the rollout of 5G going to affect the polarisation between rural and urban ‘haves and have nots’? Is it going to widen that divide? We talk about the need for densification, but where there is less imperative to go and roll all this kit out in an isolated market town, is someone going to need to step in and do that? There are already areas of the country that have poor connectivity, so what does the government need to do to make sure we fill in some of these blank spots?BF
.
I think the industry has been talking to the Government about this for some time. I'm sure that there are initiatives in play that are going to deliver this. There was a project two years ago known as the Mobile Infrastructure Project. But owing to the difficulties and the cost of deploying infrastructure in some of the rural areas, unfortunately it wasn't very successful.
The Government put money up to deliver that, but it was just too difficult in some of these rural areas. But conversations are ongoing to find solutions, and I think that if we can get the new legislation to work and reduce costs we will definitely improve the amount of coverage we can provide in those areas.
Somebody said to me the other day – and actually it resonated a bit – that if somebody had a fatal emergency in a rural area because someone hasn’t got the right connectivity on their mobile phones, it could be because operators haven’t been allowed to put masts up in that area. Maybe then, the economic and social benefits of having good connectivity would be realised.
A while ago we had a motorway site where we hosted the emergency services, the site was down but the landlord was blocking us getting access, meaning a stretch along the motorway had no emergency services coverage. In the end, we had to get the police to help us get access. That sort of behaviour is negligent and unacceptable. This is where a code will come into play, helping us to access sites to undertake essential repairs and maintenance where necessary to deliver better mobile connectivity.
CLOSE
CLOSE
CLOSE
Extra MSA are one of the UK’s leading owners and operators of motorway service areas, and have recently been facing the challenge of adding to their number of sites while preparing for 5G connectivity and superfast electric vehicle charging.
With construction underway at their new Leeds Skelton Lake site, and proposals in the works for services at Solihull, Amersham, and Warrington, Extra have been engaging in a number of collaborations to ensure both their existing services and these new sites are totally ready to serve the tech requirements of their customers.
Connectivity through service stations
Andrew Long,
Chief executive officer, Extra Motorway Service Area Group
Interview
Q.
How much progress have you made towards rolling out EV charging stations?A
.
We already have four to six bay 50kW Multi Charger facilities at all existing Extra MSAs in conjunction with Ecotricity, and these will remain in situ until at least November 2021. They will imminently be complemented by the installation of six 350kW IONITY ‘high powered’ charging stations at each location for the first phase of their involvement. This will then be further enhanced by what is likely to be an additional six 350kW ‘high powered’ charging stations being installed in the next five to seven years, dependent upon customer demand.Q.
What barriers are limiting your rollout of superfast electric vehicle charging?A
.
There are significant deficiencies in regional Distribution Network Operator (DNO) infrastructure. These do present challenges to Extra and its EV charging station tenant operating partner IONITY, preventing us from procuring the necessary level of power supply specific to each location. This has not improved with the DNO operators, and Government intervention is required in order that a national problem is addressed on a national basis and not piecemeal through individual DNOs.Q.
Is it simpler to provide EV charging facilities on a new build, or adapt an older site? A
.
Irrespective of the age of an MSA facility or whether or not it is a ‘new build’, the process of procuring the necessary level of electricity supply for EV ‘high powered’ charging is substantially the same. Primarily, it is a geographical challenge in terms of whether or not the DNO infrastructure is in existence to meet supply requirements or in need of being upgraded. The current DNO approach is typically one of asking the customer to pay for upgrading their network, when in my view it should be their own responsibility to meet the changing demands of their customers.Q.
How can the government support the providers of EV charging?A
.
The government needs to adopt a clear plan and timetable for procuring the upgrading of the infrastructure, working with National Grid and bringing together the respective DNOs for a uniformed approach in order to provide a consistent solution for what is a national requirement. Q.
Is there a need for collaboration in the long-term to update motorway systems?A.
There is definitely a need for collaboration and this is now starting to happen. OLEV, in conjunction with Government and input from respective MSA operators, are now starting to realise the challenge that needs to be addressed. This is also supported by Highways England/DfT, and I have myself been involved in a number of OLEV Highways England/DfT meetings, as well as lobbying Ministers and encouraging a national approach through entities such as National Grid.
As formally announced earlier this year, Extra has entered into a Framework Agreement with IONITY whose Shareholders include Audi, BMV, Ford, Hyundai, Mercedes, Porsche and VW. This will support the provision of EV ‘high powered’ charging stations at all seven existing Extra ‘umbrella branded’ MSAs, together with our new MSA developments at M1 Leeds Skelton Lake and M42 Solihull. Q.
What other energy initiatives have Extra been engaging in?A.
In addition to the ongoing upgrades of the EV charging station facilities, Extra is also facilitating Shell’s Alternative Fuels Strategy, which has already included the provision of hydrogen fuel as a five year pilot scheme at Extra’s M25 Cobham and M40 Beaconsfield MSAs. It is also clear from our close working relationship with Valero that there will be further significant innovations in fossil fuels, as well as an ever increasing role for biofuels like ethanol. Valero is one of the largest producers of ethanol in the world and biofuels are also an important element for Shell and BP, together with their own initiatives for EV Charging.Close
Mid-Sussex is not urban. We have three towns and are bookended by the Ashdown Forest and the South Downs. We have more trees than people. But we as much as any other authority have started thinking about 5G infrastructure and provision now because it will have huge implications for the planning and layout of our built and rural environments.
Thinking about our current town centres and resources, the sort of connectivity we talk about with 5G and the digitalisation of transport means we can use all our resources better.
Cars can be closer, and automatically take alternative routes, so there’s less traffic, and town centres don’t need as much car parking because it's efficiently allocated or people are dropped off. Emissions and energy usage can be effectively monitored.
That starts to change the nature of the town centre and its infrastructure provision: do we need as much parking, do we need more satellite delivery centres?
The infrastructure required for that is excellent connectivity.
At its simplest planning includes provisions for smart signs and street furniture – and laying the connection for those. But driverless vehicles are going to need excellent connectivity all along their routes, as are commuters on trains.
With London and Gatwick to the north, Brighton the south, we have some seriously busy transit corridors for train and car, we need to provide for those, and we also want to measure sustainability along them.
The place of local government: examples from a quasi-rural local authority
Simon Hughes,
Head of Digital and Customer Service - Mid-Sussex Council
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Hitachi Vantara, a subsidiary of Japanese conglomerate Hitachi, deals with high performance storage, big data analytics, as well as building data driven digital solutions, which can all be boosted by 5G.
The capacity needed and its potential
Felipe Padilla Gomez,
CTO of IoT, AI and Analytics, Hitachi Vantara
CTO Felipe Padilla Gomez talks about the challenges around building the necessary infrastructure to unlock the benefits 5G can bring.
Interview
Q.
What is needed in terms of infrastructure to make 5G happen?A
.
The first thing telecoms companies are doing is fitting for the change in the mobile access technology – the communication between your device (such as a mobile phone) to a network tower. That’s changing because it will be much higher speed under 5G. What that requires is small cells embedded in buildings, and the responsibility for that capability is going to fall on property managers – in much the same way Wi-Fi does now. This is already happening in the US and Asia.
Secondly, the entire network capacity needs upgrading to bear the data load of 5G telecoms. That requires mass rollout of fibre-optic installation by Telco's, to increase core capacity and sustain the hundreds of exabytes of data 5G connections will manage. Telecoms companies had to make a massive step change to bear the impact that the 4G switchover had, sustaining 75% of internet traffic being video. With 5G, that step change is multiplied by a hundred times. Telcos are investing billions in infrastructure to prepare for the data requirements of 5G – buying a spectrum, core capacity, and optimising their infrastructure to sustain that.
From a property perspective, those who already have fibre installed will benefit hugely. But people might be surprised to know that even non-connected sites will benefit from 5G without needing fibre. Residential and commercial sites will be able to enjoy gigabit capacity with 5G via fixed wireless access services from Telecom companies, and this is one of the ways telcos will monetise 5G, in addition to IoT and new offerings to emergency services.
Q.
How is 5G going to help businesses solve problems and spur online communication? A
.
From a collaboration perspective, it’s hard to look past augmented reality. Holograms will be viable: the Star Wars Princess Leia science fiction fantasy will finally be reality.
Augmented reality can also be used in heavy asset areas for applications such as assisting emergency services. During a fire, VR can help navigate firefighters inside the building who may be lost or blinded by smoke. That’s just one example, and that alone is going to save countless lives in the future.
That’s the potential of the step-change in capacity provided. 5G allows that because of the reduction of what is called latency: how fast a connection is. Latency is why video-conferencing and Skype connections have been notoriously unreliable to date. However, 5G reduces latency to a millisecond level, and that enables an array of new things: tactile technologies, remote controlling, and a whole level of new applications. The IoT is going to heavily transform most of the urban settings we live and work in, from smart cities to university campuses. Sensors collecting data in real-time, and making improvements to optimise public spaces for safety, convenience and comfort, will all become a reality. 5G exponentially increases the number of devices that can be connected to the network in a given area, as well as reducing the battery life required to run devices. That means they can be deployed in spaces like roads, where it would be impractical and expensive to have devices that need replacing every year or so, but where 5G allows devices that can last over a decade.Close
The View from Hangzhou: How a Chinese City approaches 5G
Mr Yonghui QU,
Deputy Director, Bureau of Commerce, Zhejiang Hangzhou Future Science and Technology City (Zhejiang Overseas High-level Talents Innovation Park).
Interview
1.
How are you planning on using new technology in the development of cities in China?A
.
At present, we are struggling to build a new model of smart city and digital China. The urban development of modern city requires the new methods are really need to use new science and technology, new methods to improve the city operation and management efficiency and service support capability of the people's livelihood, and thus to build a strong software ecosystem of a new city. We basically rely and focus on development of such core technologies as 5G, artificial intelligence, big data, cloud computing, the Internet of Things in order to integrate into global leading innovations of new science and technology, to build more sectors of smart city including intelligent government, civil affairs, finance, security, transportation, ports, education, health care, real estate, environmental protection, pension support and so on, using new science and technology to encourage the construction of a new type of intelligent city.
4.
China is known for leading the world in delivering huge infrastructure projects. What infrastructure are you planning at Hangzhou? A
.
In terms of improving large-scale infrastructure construction, Hangzhou mainly has the following layout. Hangzhou actively plans to build a new high-speed railway station in the west of Hangzhou, a Hangzhou Future Science and Technology Culture Center, South Lake Science Center, Hangzhou City West Sub-Center and First-class International Innovation and Entrepreneurship Community; accelerate the completion of strategic planning research on green transportation network system, layout of infrastructure such as rail transit, distribution of public facilities, and focus on improving the comprehensive carrying capacity and he level of internationalization; improve the construction of educational infrastructure, various high-level schools like Haichuang School of Xuejun Middle School, Hangzhou School of the People's Congress Affiliated Secondary School and other schools was established with wide social approval; Yuhang Hospital of Zhejiang Medical College provides medical treatment and other for surrounding neighborhood. In Hangzhou, all kinds of large-scale infrastructure projects are under construction, and the city's supporting facilities are improving day by day.2.
What are you specifically planning around Hangzhou? A
.
In Hangzhou city planning, in the overall framework of “Digital China”,“Digital Zhejiang 2.0”and new smart city construction, we will further strengthen the efficiency of information construction, use emerging information technologies to turn Hangzhou into “the city of innovations and dynamics” and “the city with the high quality of life”. On the one hand, Hangzhou municipal government promotes the integrating development of the Internet, mobile Internet with other fields. On the other hand, it encourages the support of new technologies such as artificial intelligence, big data, Internet of Things, cloud computing, intelligent hardware and virtual reality to constantly generate new applications, new modes, new formats, new technologies and new services, and speed up the use of new information technologies. We will upgrade traditional industries, transform government functions and improve people's livelihood, and also accelerate the construction of digital Hangzhou.3.
What technological needs will the city have in 2040 and how do you plan for those now? A
.
We imagine that, in 2040, the development of science and technology may reshape our lives. According to the most conservative predictions, there are more than 100 billion devices will be connected to the Internet of Things by then. That includes mobile devices, wearable devices, household appliances, medical devices, industrial detectors, surveillance cameras, cars, clothing and so on. All created and shared data will bring a new information revolution to our work and life. There are still many technological needs, such as unmanned driving, robots and automation systems, smartphones and cloud computing, quantum computing, VR/AR hybrid reality, advanced materials, 3D printing, human enhancement and so on. The development of new technologies requires talents, open and inclusive environment, so Hangzhou is exactly the kind of such advanced city. We are tolerant and optimistic about innovation and technologies.5.
What can London learn from your plans? A
.
It's more about the communication, investigation and learning from each other. In May of this year, "Zhejiang-London Technology and Innovation Cooperation Exchange Meeting" was successfully held in Hangzhou. During “Science and Technology Week”, The visiting delegation from London including British cutting-edge technology enterprises, visited representative enterprises of Zhejiang province and participated in a project roadshow to promote exchanges in science, technology, market and academic knowledge between Zhejiang and London. We know that London is one of the world's leading cities and an outstanding example of globalization.
We have been making great collaborative efforts in all kinds of science and technology industries, taking science and technology innovation as the core driving force of urban development, and striving to maintain the leading position in the field of science and technology and industry. We look forward to jointly promoting scientific and technological innovation and co-development through bilateral exchanges.6.
How does 5G specifically fit into your plans? A
.
First, in terms of industrial carrier, yuhang district has a forward-looking layout of 5G industry. On January 20 this year, it officially launched the construction of 5G innovation park in hangzhou, China, to build 5G industrial cluster and strive to build the country's famous source, incubator and agglomeration of 5G future evolution technology and business application. Second, in terms of the basic environment construction of 5G network, the current 5G innovation park has achieved full coverage of 5G network. It is expected to open 250 sites by the end of this year, which will realize the full coverage of 5G network in the future science and technology city. Third, on the industrial platform, strengthen cooperation with national ministries and commissions, large institutions and well-known institutions, and build some platforms, such as the artificial intelligence (Hangzhou) research center of China communications institute, qualcomm joint innovation center and so on. Fourth, in terms of project introduction, we will carefully plan the investment invitation for subdivided industries. According to the early 5G industry development strategy, we will strive to introduce high-quality projects with industry driving and technology leading functions, focusing on the subdivided industries such as unmanned driving, 5G chip, AR/VR, ultra-hd video, uav and smart city.7.
What will 5G mean for businesses and residents in your city? A
.
In the era of 5G, mobile networks will achieve faster speeds, wider coverage and lower latency. IoT application and interconnection of all things will bring more advanced business models for urban business development – a new intelligent business ecology. 5G can facilitate the digital transformation of traditional business, traditional commerce, integrate online and offline traffic with the advantages of intellectualization and interconnection of all things, link businesses and consumers, bring maximum benefits to businesses and consumers, and build an unprecedented intelligent business ecosystem. 5G technology will greatly change the way of life for ordinary people too. In the future, every scene in our life will be full of intelligence. I believe this day will not be too far away, let's look forward to it together.8.
How will connected devices, 5G and artificial intelligence change the way cities are planned and designed?A
.
From the history of human development, we can see that the urban planning and construction are closely related to technological progress in different periods. In our original city, business, industry, schools, hospitals and other forms of business are relatively isolated. Now, after implementing of 5G, artificial intelligence, interconnection of all things, unmanned vehicle, edge computing and other technologies and applications, with the help of precise analysis of technology, this model of industrial isolation is expected to be changed, achieve integration and development, and lead to the birth of "urban brain". In addition, the existing urban planning can also be precisely adjusted at any time according to the needs of residents to create a more livable city9.
What are going to be some of the biggest changes - autonomous vehicles, supply chain management, sensors and manufacturing?A
.
I think the breakthrough of 5G technology has the greatest impact on the industry of the Internet of Things. The emergence of 5G not only accelerates the network speed, but also increases the number of users up to 1 million per square kilometer, which can better meet the massive access scenarios such as the Internet of Things. With the growth of mass devices, the future 5G network will not only increase the level of communication between people, but also between people and things, and between things. It can support a large number of terminals at the same time, and make personalized and customized applications become common. Situational awareness technology can enable the future 5G network to actively, intelligently and timely send the required information to users.10.
You want to become China’s centre for fin-tech. What is your message to potential investors who may want to invest in the city’s infrastructure or into its start-ups?A
.
The development of 5G and the new generation of AI will be based on the financial essence of the real economy development, promote the two-way optimization of industry and finance, accelerate the transformation, and transform the real economy into the frontier economy of information, intelligence and individualization. Great changes are taken place in the business model and lifestyle of the society with the development of new technologies. In the next age of fintech, technology will be the most important pillar. So, to support the development of new technologies, to invest in new technologies is to invest in the future.11.
How could we work jointly with you, along with our friends in London, to create a strong message about Hangzhou?A
.
The UK is a good friend of China, a member of United Nations Security Council and one of the most developed countries in the world. As the capital of Britain, London is also the world’s leading financial and technology centre. Last month, Zhang Zhenfeng, Zhang Zhenfeng, Standing Committee of Hangzhou Municipal Committee, Secretary of Yuhang District Committee and Mei Jiansheng, Secretary of Party and Labor Committee of Future Sci-Tech City, visited London to discuss cooperation between London and Hangzhou Future Sci-Tech City. Hangzhou Future Sci-Tech City is one of the four future science and technology cities in China, with four focus industries including digital economy, bio economy, intelligent manufacturing and fintech, is striving to form the industrial development pattern of "science and technology innovation + headquarters economy. Of course, compared with London, there is still a lot of things to learn. Hangzhou Future Sci-Tech City also welcomes technological enterprises and financial institutions from London for cooperation.Close
CELLNEX TELECOM: TRANSMISSION RE-VAMPED
Q.
Can you set out what Cellnex does a business? A
.
Cellnex is an independent telecommunication infrastructure provider, and little by little, since our IPO in 2015, we have been growing in terms of capabilities and activity. This means moving from a more passive role, providing to the customers basic services to a more active role. As a result, for instance, we have now an IoT business line where we provide connectivity using proprietary solutions like SigFox technology and we also have a line working on DAS & Small Cells to service densely venues or populated areas.
To give you an example of what this means in practice, think of how a mobile operator tries to cover an entire city. They put what we call macro cells onto big towers to collect the traffic from the customers and then share to their core network.
However, in areas where there are a lot of people in the same place, that traffic is too much and the cells are not able to serve all the demands of the customers in that area. That's why you need to put smaller cells that you can put every 100 metres, or every 50 metres, depending on the configuration, and collect all this traffic. So, in short, what we do is provide the equipment for the mobile operators to use.
As an example, in terms of IoT solutions, one of our latest projects was oriented to social housing where we provide services to these houses to control humidity, temperature and air quality. We also provide sensors to agriculture, to stadiums, to logistics, to position tracks – whatever (machine-to-machine) has to be connected.
Q.
More broadly, how do you see 5G impacting real estate? A
.
We see opportunities in two fronts: infrastructure and new use cases opportunities.
By infrastructure we mean the architecture that you will have behind 5G that will enable services. For example, right now, not all the antennas are covered with fibre. But with 5G, antennas will need to be connected with fibre in order to be able to cope with all the traffic that is collected. In the past, fibre was meant only to reach the customer if needed, but now the infrastructure will need to be covered by fibre. As a result, the network of the mobile operator will change dramatically.
We’re coming from a world that the mobile operator had everything centralised and they had all the coordinate work in one place or in two places. With 5G, that this is not possible and they will have to distribute the architecture. This means that they are going to have a little bit of capacity and they literally have processing capacity but also decision making closer to the antennas. So 5G will probably be organised by neighbourhood or at a district level.Q.
Is the future of wireless infrastructure neutral? A
.
We strongly believe that that's the future - that’s already the situation in the US. Here in Europe, between 20 and 30% of the infrastructure is shared by mobile operators or owned by neutral operators like Cellnex, while in the States, around 70% to 80% is shared or owned by third external and independent companies.
A neutral network brings efficiencies to the mobile operators as, rather than having to pay for their own infrastructure, they can share – thereby reducing investment and maintenance costs.
Also, companies like us simplify the management of the landlords' and owners' discussion by offering different models. We can build the tower ourselves, that's a possibility. But there are some cases when we search for space, and we make a deal with the tower owner. Or, we buy the tower where the mobile operator has already that relationship with a landowner. In that case, we acquire the rights and we make the negotiations with them on behalf of the mobile operator. In most of the cases we close a deal with land owner on behalf of the operator because it simplifies everything for them.Q.
How is the relationship changing between mobile operators and landlords? A
.
Mobile operators have many restrictions on investment and they are very selective where they require coverage. In the past, it was logical that the mobile operators would pay for that infrastructure to make sure that their users will have coverage in the area. But what’s happening more and more is that if a mall opens outside the city, mobile operators will demand payment for that infrastructure, so a mall’s customers can have mobile coverage.
So we are seeing a movement towards a situation where landlord owners consider the coverage as something that they need to provide and pay for and not rely on the mobile operators to pay for it.Q.
Is there anything that UK politicians should be changing to support the roll out of 5G?A
.
What we see is that UK politicians are already getting more conscious that they need to facilitate and they need to have similar regulation in the different cities across the UK.
Around six months ago, BT, through EE, invited us to a forum where the politicians wanted to understand what 5G would bring and there were attendees from Wales, Scotland, Northern Ireland and from several of the big cities in the UK. All of them talked about 5G implementation because they understood that they had to have a similar approach as the UK regulator who will be facilitating the use of public spaces for 5G roll out.
This makes sense: if you have four mobile operators in a country, and you receive four requests to have a tower in sites that are 100 metres from each other, it's more efficient to offer one single place, and maybe through an entity like us as a neutral host, than have four different sites.Q.
Where would you like your business to be in the next couple of years? A
.
Our expectation is to grow into the seven European markets and we want to go from being purely a TowerCo, an entity that just provides and manages towers, to become an InfraCo, so an infrastructure partner. We want to plan and deploy with the mobile operators the set of infrastructures they need.
An example is a partnership agreement that we have reached with a mobile operator in France, where they have decided to sell us all their assets. They have sold all the central offices and all the metropolitan offices with a commitment that we will keep on growing if needed and add additional offices and new services, like edge computing, when required.
We want to help mobile operators not only in the radio access network, but also helping them to migrate to 5G, bringing their core network and their equipment with them.Jose Antonio Aranda,
Innovation and Product Strategy Director, Cellnex
Jose Antonio Aranda, discusses how neutral networks could play a key role in supporting the roll out of 5G.
Interview
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