The state of 5G in the Netherlands: Expectations vs. reality

For Europe and the Netherlands, 5G mobile technology presents enormous development potential: the reliable, fast, networks with a high density of connections can transmit data faster than ever before, allow companies to monitor their assets in real time, and make remote management and automation possible on a large scale.

Because 5G networks are up to 90% more energy efficient compared to 4G networks, they have the potential to not only save money but are also more environmentally friendly. 5G can not only satisfy growing consumer demand for mobile data, but connect billions of humans and devices across the globe, which most economists predict will have a transformative impact on Europe’s GDP.

Enterprises and the public sector stand to gain even more than consumers, thanks to potential applications in industries like manufacturing and logistics, construction, smart cities, engineering, agriculture, and health care.

What is 5G?

5G is the general term used for a set of standards and technologies — the fifth generation of wireless mobile technology — that can transmit data up to 100 times faster, with a capacity that is 1,000 times greater, and using less energy, than prior-generation mobile technology. It can send enormous amounts of data over short distances and can connect more IoT (internet of things) devices than ever before. 5G is faster, more reliable, and more responsive than 4G.

What consumers can expect from 5G today

 5G services are new to the Netherlands, which sold the 2.1GHz, 1.4GHz, and 700MHz bands under 20-year licenses to telecommunication companies in 2020 for €1.23 billion (US$1.4 billion). KPN, T-Mobile, and VodafoneZiggo are the providers currently offering 5G. Connect Test Lab reported that all carriers claim to reach between 80%-100% of the population in 2021, with connectivity available in small towns, rural roads, and even on high-speed trains.

Operators holding 5G licenses must offer a minimum speed of 100Mbps, and at least 8Mbps in rural areas, according to Simon Sanders and Elly Besterveld, lawyers at Amsterdam-based law firm CMS. Service providers will be required to ensure 98% geographical coverage across all municipalities in the Netherlands in 2022.

The reality of 5G in the Netherlands now

Mobile operators in the Netherlands, however, are offering 5G tariff plans at the same price as 4G plans, as they’re unable to access the high-spectrum frequencies needed to really differentiate from 4G. In order to offer faster 5G network speeds, the government urgently needs to allocate access to the 3.5GHz frequency band. According to Statista, the crucial 3.5GHz band will make up 60% of the population’s 5G coverage by 2030.

The 3.5GHz frequency band allows for what’s known as ‘mid-band 5G’, enabling faster transmission speeds than lower frequencies. Higher frequencies in the 25GHz-39GHz offer even faster speeds, but transmitters operating at that frequency band have limited range. Networks servicing those frequencies require more transmitters, which is potentially costly, and are practical for only densely populated areas.

“Excellent mobile connectivity is key for the further digitisation of society — which is already high in the Netherlands,” says Sherida van IJsselmuide, at T-Mobile Netherlands. “As a telecom provider, we see the continuous and spectacular growth of data consumption, partly due to the increase of people working from home because of the COVID-19 pandemic.”

“The adoption and the dependency of mobile connectivity and services have been accelerating over the last years. Not only do they enable many new digital-only services such as remote and mobile work, but also mobile shopping, payment, and banking is taking over internet banking,” says Van IJsselmuide

But Dutch consumers still need time to warm up to the idea of premium 5G services, according to Deloitte’s Dutch edition of the 2020 Global Mobile Consumer Survey. Only 42% of those surveyed expect to have improved connectivity when they move to 5G, with 68% unwilling to pay a premium the population’s 5G coverage by 2030.

Why is 5G network deployment so delayed? 

The rollout of 5G in the Netherlands has trailed behind many other nations in Europe because the 3.5GHz frequency was occupied — namely, by military intelligence agencies and the Ministry of Defence and British company Inmarsat. The company uses the frequency for safety communications with ships in distress, and filed a civil suit against the Dutch government in March 2021 to retain access to the spectrum. An Inmarsat representative said that the amendments to the National Frequency Plan “are unnecessary and put lives at risk”, noting that the company uses 25% of the band for safety and security reasons.

Inmarsat won in court, suspending the order to ban other users of the 3.5GHz frequency in September 2022 and pausing plans for the much-anticipated auction planned for April. State Secretary for Economic Affairs and Climate Mona Keijzer explained in a letter to the House of Representatives that “the exact duration of the auction delay depends, among other things, on the advice of the independent advisory committee,” which is set to be delivered in Q1 2022.

“For 5G, we are desperately awaiting the allocation of the 3.5GHz band in the Netherlands,” explains Van IJsselmuide. “Especially to increase the speed and to make new applications available that require higher speeds. With this, we will be able to take the next steps of this mobile evolution.”

Edge computing and business applications

 Powerful transmission speeds, broadened network capacity, and reduced latency will allow enterprises to manage all aspects of their business in real time as they undergo digital transformation. Internally, businesses can create 5G-powered smart offices that will change the way that employees work by enabling hybrid remote/in-office teams, allowing companies to better manage resources, and improving productivity. Away from the office, the potential use cases for 5G are countless, such as improved supply chain management and transportation logistics that fuel an e-commerce industry worth €26 billion in the Netherlands.

“Not only does the acceleration of mobile connectivity and service impact consumers, but it also facilitates the digitisation of small businesses. For larger companies, this provides more efficient logistic services for industries and ports. The health sector will be able to further develop, thanks to the innovation of mobile connectivity and services, which in itself drives the need for more tailored enterprise solutions with the potential use of services via a dedicated spectrum,” Van IJsselmuide says.

5G is essential for edge computing, where relevant data is processed and bundled within the network instead of sent directly to the cloud, allowing IoT sensors to conduct real-time analytics and reducing latency. This could have an enormous impact in use cases such as traffic management and predictive maintenance in production lines — a boon in the Netherlands, where the shipping industry contributes €7.7 billion to the Dutch economy. Smart cities and smart homes, which are fuelled by countless IoT devices that gather data, can use edge computing powered by 5G to reduce backhaul costs and process sensitive data more securely.

Network slicing and 5G services for industries

5G also enables network slicing, which allows telecommunications companies to divide the use of their network among certain customer segments that require different services. This presents opportunities for other emerging industries like autonomous vehicles. Travel with self-driving cars, which McKinsey expects to make up 66% of passenger kilometres by 2040, demands more sensor data than can be individually processed by a single car. Dedicated 5G networks for autonomous vehicles will allow high-density ‘platooning’ (the electronic coupling of two or more vehicles) and improved risk warnings for both individual passengers and enterprise transportation companies alike.

KPN, one of the Dutch providers of 5G, started offering three new industry 5G services last year aimed at companies working in autonomous vehicles, logistics, and the manufacturing industry. Clients like Shell use the guaranteed bandwidth, application priority, and coverage on demand services to support their businesses.

“Enterprise service strategy will occupy the greatest amount of CIO mindshare,” predicts an MIT Technology Review report. “The questions of ‘where to play’ and ‘how to play’ will remain critical for operator CIOs and enterprise business heads. These questions will shape decisions about which partnerships to form, which technical capabilities to build or acquire, and how to capture the most value from enterprise services.”

The power of 5G for the public sector

“In the public sector, we are noticing a clear shift from the replacement of traditional voice dispatch systems to MCPTX [a first responder communications platform] over 4G and 5G, along with full digitisation of processes for first aid responders, law enforcement, civil servants, and personal security. This increases efficiency, reduces paperwork and creates more time for doing public work,” Van IJsselmuide explains, noting that T-Mobile’s network is currently resilient enough to withstand several hours of power outages in emergencies without any human intervention. “Given the fact that both the public and private sector depend on our network, we as a telecoms operator demand the highest standards and clever architecture designs, for both our infrastructures and digital platforms.”

5G has the potential to improve everyday life in communities: faster emergency response teams, reduced pollution, safer traffic, and increased public safety are some of the benefits promoted by 5G advocates. It can support a complex transportation network with detailed mapping and information about road and traffic conditions. Healthcare will become more accessible and cost-effective through video/telemedicine and 5G-enabled cameras and other devices. In emergencies, 5G powers secure communications with HD voice quality and supports remote technology that allows responders to assist from afar. The vision is optimistic and aspirational, but until a decision is made about the powerful 3.5GHz frequency band in early 2022, the Netherlands’ vision for safer, smarter, 5G-powered country cannot become a reality.