France to auction off 5G frequencies

PARIS: This file illustration picture shows the 5G wireless technology logo displayed on a tablet in Paris. France launches auction for remaining controversial 5G frequencies. – AFP

PARIS: France yesterday began to auction off radio frequencies for the deployment of ultrafast 5G mobile technology, a process that will add billions of euros to the government’s depleted coffers. Operators Orange, SFR, Bouygues Telecom and Free are bidding for 11 frequency blocks that are currently unused, with the aim of offering 5G services in some French cities by the end of the year. The fifth-generation successor to 4G technology promises radically quicker transfers of data, heralding major changes to an array of products and services from self-driving cars to remote surgery.

France was to launch the sale of the frequencies in April, but postponed the auction because of the Covid-19 crisis. France is lagging behind other countries that have already launched 5G services, with South Korea and China the most advanced. More than a dozen EU countries have also started operating 5G services, but none as developed as the Asian frontrunners.

Activists and leftwing lawmakers in France have tried to halt the 5G rollout because of health and environmental concerns, but President Emmanuel Macron’s government has pressed on regardless. Macron, eager to cast France as a start-up nation embracing cutting-edge technologies, this month even derided 5G opponents as wanting to impose “the Amish model.”

He said “France is going to pursue the shift to 5G because it’s the shift towards innovation.” The government expects to make at least 2.2 billion euros ($2.6 billion) from the sale, a welcome windfall at a time when it is throwing all its financial firepower into the fight to limit the coronavirus pandemic’s economic fallout. The deployment is also seen as a crucial boost for French industry, under pressure from new restrictions curbing economic activity.

“Everybody knows that this is extremely important for the economic recovery and for the future of the industry,” digital minister Cedric O told Europe 1 radio yesterday. The main auction for frequencies is scheduled to last for 10 days, after which a second auction will determine the exact positioning of operators on each band, with the center of bands less prone to interference than the edges.

One complicating factor is the heavy restrictions placed on the use of equipment by Huawei, which some governments, especially the US, suspect of potentially helping China eavesdrop on western networks. The absence of the Chinese behemoth, considered by many experts to produce the most advanced 5G equipment for the best price, will force SFR and Bouygues Telecom especially to switch to rival suppliers Ericsson and Nokia, a move requiring a big revision of their investment plans.

Finland’s Nokia will replace Huawei as BT’s largest equipment provider after winning a deal to supply 5G networks across the UK, the companies announced yesterday. The move is the first UK contract for the Finnish telecoms maker since Prime Minister Boris Johnson banned mobile providers in July from using equipment made by the Chinese giant in their new 5G networks.

The restriction, on national security grounds, forces mobile providers to begin switching out “high-risk vendors” from 2021, and marks a golden opportunity for Huawei’s two main rivals in the 5G market, Finland’s Nokia and Swedish Ericsson. Companies in the UK have until 2027 to remove Huawei equipment from their 5G networks, a change which BT has said will cost it £500 million ($643m).

Under the BT deal, Nokia will supply base stations and other network equipment to allow its customers to access super-fast 5G internet. Nokia equipment will also be installed in the company’s existing 2G and 4G networks. However, the company told AFP it will also use other suppliers to replace the totality of its Huawei 5G equipment.

“With this next stage of our successful relationship with Nokia we will continue to lead the rollout of fixed and mobile networks to deliver stand out experiences for customers,” BT CEO Philip Jansen said in a statement. Although the ban on Huawei offers a significant boost to Nokia and Ericsson, industry watchers have warned that fulfilling the increasing demand left by the market leader may not be straightforward.

Nokia last year downgraded its 2020 earnings forecast in the face of fierce competition over the 5G networks market, while previous chief executive Rajeev Suri played down delays in delivering some equipment orders. However the firm’s most recent results saw an increase in profit and new CEO Pekka Lundmark is expected to shake up the company to try to recover some of the ground lost to Nokia’s 5G competitors. -AFP

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