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5G is the next generation of mobile network that promises to revolutionise the way we connect and use technology. With faster download speeds and greater connectivity capacity, 5G promises to unlock new opportunities for businesses and consumers. In this article, we explore the potential benefits of 5G, its technological challenges and the impacts on society and the economy in France.
Our article is based on the Omdia report commissioned by Orange, which provides an independent assessment of the impact of 5G in 2030 on the economy, employment and greenhouse gas (GHG) emissions in five European countries
Figure 1: Impact of 5G in France, 2030
Before discussing the potential impacts of 5G, Omdia considers it important to understand the current context of its deployment in France. This includes a review of the deployment progress, an overview of recent initiatives and the analysis of a representative use case that will show how 5G can generate a positive impact.
The 5G environment
5G deployment in France is accelerating
Let’s reinvent the way we connect citizens to the digital future. In 2018, Arcep revealed its 5G roadmap highlighting digital transformation, a coordinated approach in Europe and preparation for 5G deployment. Key priorities were also defined, such as spectrum allocation, development of new uses, support for 5G infrastructure, transparency and dialogue on new 5G site deployments, and impacts on public exposure to electromagnetic fields.
In October 2020, the auction of 5G bands in France closed after a delay due to the pandemic. The four major telecom operators Orange, SFR, Bouygues, and Free Mobile won the frequencies by playing their cards. With 90 MHz, Orange won the most frequencies, closely followed by SFR with 80 MHz, and Bouygues and Free Mobile with 70 MHz each. By the end of 2020, operators began offering commercial 5G services to the population, with Free Mobile already covering 40% of the country. SFR and Bouygues launched their commercial services in November, while Orange started in December in 15 municipalities, with the aim of covering 160 by the end of the year.
Recent developments in 5G use cases
In 2020, there have been many announcements regarding 5G use case tests and implementations in France, such as Orange and Schneider Electric’s collaboration on Industry 4.0. Omdia believes that the focus on Industry 4.0 makes sense because, in combination with other technologies, 5G can boost revenues in the manufacturing industry by improving productivity, quality and time-to-market in factories, producing 5G-connected equipment and products for consumers, businesses and industry, and developing ‘as-a-service’ business models that leverage this connectivity and extend the relationship between manufacturer and end-user beyond the sale of the product.
In partnership with Schneider Electric, Orange decided to embark on the 5G indoor adventure by deploying an experimental virtual private network. This experiment made it possible to test the uses of augmented reality and telepresence. Using 5G-connected tablets and Schneider’s EcoStruxure Augmented Operator Advisor application, real-time data was overlaid on physical objects in a factory. In addition, a 5G-connected mobile telepresence robot provided a virtual tour of the Vaudreuil site. 5G made real-time visualisation and remote interaction with a virtual assistant possible. Omdia predicts that the manufacturing industry in France will be conducive to new uses of 5G with positive spin-offs for the country.
Example of a use case in France: the manufacturing industry
The manufacturing industry must be innovative to cope with disruptions
France is a leader in gross production in manufacturing and is home to powerful sectors such as automotive, aerospace, defence and industrial equipment. However, these traditional industries face many challenges, such as increasing competition from cheaper economies, high fixed costs, an ageing workforce and changing customer preferences.
The challenges faced by manufacturers may seem daunting, but in order to meet the growing competition and remain competitive, they must be at the forefront of innovation. Manufacturers must strive to be more efficient, adopt agile processes and align themselves with the consumer habits of their products, services and solutions. Connectivity plays a crucial role in the transformation of the manufacturing industry, and private wired connectivity via Ethernet and fieldbus* is widely used in factories. However, wired connectivity has drawbacks such as the disruption of installing new cabling and is not always suitable for certain uses that require mobility. Public cellular networks have historically faced obstacles such as lack of in-house expertise and concerns about reliability and security, but it is time to embrace them to ensure optimal connectivity.
5G’s technical capabilities are attracting growing interest from manufacturers
The survey reveals an interesting trend in industrial innovation. The results of Omdia’s IoT Enterprise Insights 2019/20 survey, show that 67% of companies in the manufacturing, industrial and extractive sectors see 5G as key to their future. 5G, with its real-time communication, flexibility and low latency capabilities, is seen as the new standard for industrial deployments.
The use cases for Industry 4.0 and 5G connected factories tested in France and other countries are as follows:
– Modular/flexible factory installation and production
– Product quality control through real-time analysis
– Energy management
– Improved equipment inspections and digital twins
5G offers advantages such as low latency and high availability that can be used for autonomous vehicles, collaborative robotics and closed control loop. Omdia expects the integration of 5G into industry in France to bring positive benefits through applications such as those mentioned.
Figure 2: France, case study on the impact of 5G: Industrial automation
Economic impact
Omdia predicts that the 5G market in France will reach dizzying heights, with a projected turnover of €190 billion by 2030
Manufacturing will be the biggest beneficiary of this exponential growth, with a 21% share of 5G-related revenue, surpassing even its share of the total economy’s gross output or turnover, which is 17% by the same date.
Figure 3: France, distribution of 5G-related revenues by industry in 2030
The potential of 5G for the manufacturing sector is reflected in many use cases, going far beyond industrial automation. While new Wi-Fi variants pose a competitive threat, the growth in interest from manufacturers in private LTE/5G is a testament to its potential to enhance connectivity and productivity in factories. Industrial companies are also exploring how 5G can optimize energy, a major source of plant operating costs, at every stage of the production process. Augmented reality is another use case that can help technicians with the crucial task of operating machinery.
Initially, AR will be carried on conventional devices such as tablets. It will be some time before wearables with built-in 5G connectivity appear, rather than sharing the wired or wireless connection with a nearby terminal. Finding the perfect balance between display performance, processing and power management remains a challenge for the semiconductor industry and its partners.
The information and communication sector will be one of the biggest beneficiaries of 5G, with 11% of its turnover linked to 5G (compared to 5% of total production or gross turnover). This considerable influence is due to the need to hire external IT, systems integration and security specialists to establish 5G connectivity, integrate it with enterprise systems and continuously manage devices.
Employment Impact
By 2030, France will have 28.1 million active workers, with 422,000 jobs created through 5G, representing 1.5% of the national workforce and 0.6% of the population. According to Omdia, these jobs will be spread across a wide range of sectors, with the largest amount of jobs generated by 5G in the public and defence sector, as well as in information and communication.
Figure 4: Impact of 5G in France, proportion of 422,000 net new employees by sector, 2030
In other words, many of the industries mentioned have a similar economic impact, but some sectors such as human health and social services, which occupy a large share of the workforce, are unlikely to be the drivers of the economy stimulated by 5G because of their very nature. However, it is important to note that there is a link between the number of jobs in a sector and the number of jobs created by 5G.
The white and blue jobs in defence and public service are set to be revolutionised by 5G. With a projected 127,000 jobs, or 2.9% of all employees in the sector, 5G offers an explosive opportunity for significant impact. By 2030, the sector will be the largest employer in France, employing 4.4 million people, or 16% of the workforce. 5G will be a catalyst for a bright future in the world of work.
5G is unleashing job storms in the information and communication world. This sector will benefit greatly from the production and implementation of 5G, which will also influence many aspects of the supply chain. Huawei has announced the construction of a network equipment factory in France which could provide job opportunities for 500 people. The impact of 5G extends to sectors not traditionally associated with wireless technology, such as transport, storage, utilities, manufacturing, health and social services, showing the extent of its impact on jobs and job roles.
5G is bringing change to the industrial world by enabling the automation of some jobs. However, despite the elimination of some tasks, the overall impact is still positive thanks to the arrival of new industrial applications. Those who work on the machines will benefit from improvements and greater efficiency, while technical and skilled jobs will be created to install, operate and maintain a new generation of systems, sensors and devices. These new jobs will also require training for employees and trainers.
Impact on emissions
5G is set to become a force for reducing greenhouse gas emissions in France. According to Omdia, by 2030, 5G will have contributed to a reduction of 10.1 MtCO2e or an incredible 2.4% of the total emissions forecast for this year. Transport will be the biggest beneficiary of this reduction, accounting for 38% of the positive impact of 5G. See the full breakdown of the impact by sector in Figure 5.
Figure 5: France, avoided emissions from 5G, sectoral share of total, 2030
Transport is set to be the biggest beneficiary of the reduction in GHG emissions from 5G in France. With 30% of total GHG emissions projected for 2030, the transport sector far exceeds manufacturing, construction and agriculture. 5G will provide a multitude of solutions to reduce GHG emissions in all transport sub-segments, including road transport, the most important one. This will have a positive impact on both consumers and businesses.
The world of manufacturing is about to connect to a bright future thanks to massive investment in 5G networks in France over the next 10 years. The aim is to improve the complex interactions between people, machines, products and services that keep factories running. According to Omdia’s 2020 ICT Enterprise Insights survey, a quarter of French manufacturers have already deployed cellular infrastructure and 63% consider them a top investment priority. Although the number of survey participants in France was limited, these figures are very much in line with trends seen among manufacturers across Western Europe, where 17% had already adopted cellular technology and 43% identified it as an investment priority.
Figure 6: Survey of Western European manufacturers: Has your company identified a compelling reason to invest in cellular?
Omdia foresees a bright era for cellular with a massive increase in investment until 2030. We are moving towards 5G, replacing 4G LTE, because of its advantages, such as lower power consumption and reduced latency. This will allow French manufacturers to explore all the possibilities of 5G, such as remote monitoring, asset tracking, outdoor and indoor broadband connection, and industrial automation. As energy is often a significant cost for the manufacturing sector, these 5G use cases will bring greater efficiency, thereby reducing GHG emissions. According to Omdia, 5G applications could enable French manufacturers to avoid up to 2 MtCO2e of GHG emissions by 2030, which represents 2.5% of the projected 80 MtCO2e emissions in the manufacturing, construction and industrial processes sectors.
Other sectors, such as energy and agriculture, will also benefit from the adoption of 5G, with a combined reduction in GHG emissions of 2.1 MtCO2e in 2030, or 2% of total GHG emissions from these two sectors.
In conclusion, the introduction of 5G technology in France is expected to have a significant positive impact on employment, the economy, and the job market. The increased speed and reliability of 5G networks will drive the growth of industries such as e-commerce, telemedicine, and automation, leading to the creation of new job opportunities. Furthermore, the increased efficiency and productivity enabled by 5G technology will result in a boost to the economy. The French government’s support for the rollout of 5G infrastructure and its focus on developing the necessary skills and expertise within the workforce will also contribute to this positive impact. In conclusion, the arrival of 5G technology in France presents a promising future for both employment and the economy.
