Since the beginning of the year, the UK’s mobile phone operators have demonstrated good progress in rolling out new and upgraded 4G coverage in traditionally hard-to-reach areas as part of the Shared Rural Network (SRN) scheme, yet their progress has not been matched by the UK government, whose plans to extend 4G mobile connectivity and broaden consumer choice in rural areas are behind schedule, according to the National Audit Office (NAO).

Moreover, according to the NAO’s Supporting mobile connectivity report, it is not yet clear whether the programme will meet its target to provide high-quality 4G coverage to 95% of the UK by 2025.

The principle of the £1.3bn SRN programme, launched in 2020, is that through both public and private investment, new and existing phone masts will be built or upgraded across the UK to close down rural mobile notspots.

The UK’s four mobile network operators (MNOs) – EE, Virgin Media O2, Three and Vodafone – have committed to improve 4G coverage and level up connectivity across the UK, which has seen them invest in a shared network of new and existing phone masts, overseen by a jointly owned company called Digital Mobile Spectrum Limited (DMSL). The operators’ £532m investment is complemented by more than £501m in government funding.

Since April 2021, Building Digital UK (BDUK), an executive agency of the UK’s Department for Science, Innovation and Technology (DSIT), has been responsible for the overall delivery of the SRN programme on behalf of DSIT. Responsibility for digital connectivity transferred from the Department for Digital, Culture, Media and Sport to DSIT in the machinery of government changes in February 2023.

To deliver the first phase of the programme, all operators committed to upgrade or build mobile infrastructure and extend the reach of their 4G networks to eliminate partial notspots. The second phase of the SRN, publicly funded by the UK government, is due to be completed in 2027 and will develop shared masts to bring 4G connectivity to areas with no existing mobile service.

The deadline set by UK comms regulator Ofcom for operators to meet their individual initial SRN coverage targets for partial notspot areas is June 2024. In January 2024, EE announced that it had completed its first phase SRN 4G coverage upgrades six months ahead of schedule. Ofcom also required operators to meet a minimum download speed of 2Mbps.

By autumn 2023, 92.7% of UK landmass had 4G coverage, but the programme was already behind schedule. The NAO report attributed a number of reasons for the delay. It said government and the operators took longer than expected to finalise mast locations, agree site sharing and access, and procure services. It added that progress on the programme had also been delayed by the Covid-19 pandemic, opposition from local campaign groups and local authorities’ capacity to handle planning applications.

More worryingly, the report disclosed that estimated costs have risen significantly on the programme, due to high inflation and other factors, although the government does not yet know by how much in total. The NAO warned that as a result of cost pressures, MNOs may no longer be able to deliver the level of coverage required within the current funding range. It observed that under the terms of their grant agreement with the government, MNOs bear any additional costs. However, if costs are excessive, MNOs may not be obliged to meet individual targets, further risking the overall ambition to achieve 95% mobile coverage across the UK.

DSIT’s business case suggests the investment will deliver economic benefits of £1.352bn through supporting tourism and business productivity in rural areas. However, the NAO believes the business case included limited evidence of the specific benefits of extending mobile coverage into remote or sparsely populated areas.

In addition, even though DSIT anticipates an average download speed of 7Mbps for rural areas, it acknowledges some areas will have lower download speeds. DSIT expects these lower speeds to meet current needs but recognises that advances in technology could lead to people requiring higher performance in the future, meaning the network may need upgrades.

“Demand for mobile data access is expected to increase as data-intensive services become more popular and new technologies enable new uses, and government has set out a clear ambition for improved connectivity,” said Gareth Davies, head of the NAO. “It is unclear whether the SRN programme will achieve its coverage target on time, costs are higher than anticipated, and government has not clearly articulated the benefits, including increased connectivity in sparsely populated areas.”

The report also focused on the UK government’s plans for future mobile connectivity which aims to kick-start investment and innovation in 5G infrastructure and sets a new ambition for standalone 5G in all populated areas by 2030. DSIT estimates that widespread UK adoption of standalone 5G could deliver cumulative productivity benefits of between £41bn and £159bn from 2021 to 2035.

Yet the NAO suggested that achieving the 5G coverage ambition would be challenging, requiring significant investment from operators, with DSIT reliant on accompanying action from other government departments and bodies that may have competing priorities for funding. DSIT will also need to draw on its experience from previous infrastructure programmes, including the SRN, to help it address these issues.

Going forward, the NAO recommended improved oversight of MNOs on the SRN programme to enable effective decision-making and sufficient focus on delivering the 4G performance for consumers and businesses. On 5G, the NAO said DSIT’s Wireless Infrastructure Strategy should establish target dates for taking key decisions about the outcomes it is seeking; determine the combination of enablers required to deliver 5G connectivity; collect data on the market’s ability to meet the UK’s future 5G connectivity needs; and learn lessons from delivering earlier digital infrastructure.

“As government develops its 5G strategy, it will need to more clearly define what it is aiming to achieve in different parts of the UK and economic sectors so that limited resources can be targeted where they deliver most value,” Davies concluded.

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