Upgraded public LTE (4G) connectivity has a social and economic impact of up to £6.9 million on rural towns in the UK, according to new research, which considered the impact on the farming, fishing, freelancing, and tourism industries in four remote UK communities after mobile operator EE had upgraded local network infrastructure. The study showed benefits of between £249,000 and £6.9 million in the four sample towns, and, in one best-case scenario, a return for EE of up to 1.9-times (190 percent) on the network outlay.
But rural investments are not always profitable for mobile operators, the study found.
The study, carried out by connectivity consultancy FarrPoint on behalf of EE, showed what the industry has known for some time: that sometimes, where it has been previously unavailable, straight connectivity is the ‘killer app’ for local enterprises. The same conclusion has been drawn variously by the industrial IoT and private 4G/5G industries, selling bespoke connectivity infrastructure for specialist applications to enterprises; it is the case presented by the satellite IoT crowd, also. The study looked at the impacts on communities in England, Scotland, Wales, and Northern Ireland.
The results claimed a social and economic benefit to local communities of between £249,000 and £6.9 million over a period of 15 years, depending on the size and scope of local industries in each of the sample towns. It said the investment to upgrade local public cellular infrastructure to higher-grade 4G technology was a boon for local economies in every case; however, it also said the return on investment (ROI) for EE only materialised in half of them (two out of four). The Scottish and English upgrades paid off for EE; the Welsh and Northern Irish ones did not.
FarrPoint considered the socio-economic impact of “four EE 4G mobile sites” on rural communities in the port town of Mallaig on the west coast of Scotland, the market town of Melton Mowbray in the middle of the UK, the linear town of Trawsfynydd in mid Wales, and the fort town of Dunseverick in the northeast of Northern Ireland. It said the scale of the benefits to Mallaig and Melton Mowbray “considerably outweighs” the cost of the network investment, which is pegged at around £553,000 per rural mast.
It said: “However, the same is not true of the masts in Dunseverick and Trawsfynydd where, even though the communities still reap substantial benefits, the cost for EE to build and maintain its 4G service is higher. This is largely because the lower population density of these locations – or presence of other networks – means less people use the individual masts.” EE claims to have invested “hundreds of millions” to expand its 4G network by 10,000 square kilometres over five years, including on around 300 new masts for about 1,700 additional rural locations.
The Mallaig study said the benefit to the local community was between £742,000 and £1,054,000, notably in the farming and fishing industries, and delivered a 1.3-1.9 times (130-to-190 percent) return on its investment for EE. In Melton Mowbray, the benefits were calculated at between £5,024,000 and £6,939,000; an ROI figure was not supplied by FarrPoint for the Melton Mowbray calculation, but it said it is positive. The EE mast in the coastal hamlet of Dunseverick (where Game of Thrones was filmed) will deliver benefits worth between £353,000 and £518,000.
Its equivalent near Trawsfynydd will deliver between £249,000 to £383,000 in benefits to the local population over the course of 15 years. In both cases, the returns fall short of the average £553,000 investment for operators to build and maintain 4G masts. But Farrpoint stated: “While masts like the ones in Wales and Northern Ireland that serve smaller rural communities have higher overall costs, they are – in relative terms – a small proportion of EE’s mobile network, which does generate an economic return, as well as significant benefits for the people and places it connects.”
Greg McCall, chief networks officer at BT Group, said: “Every rural community can benefit from modern mobile connectivity. This report provides evidence of how it is helping local businesses grow, supporting rural employment opportunities, and enabling more people to experience the benefits of the digital economy. That’s why we’re proud to have delivered on the coverage targets we committed to, helping to close the digital divide and ensure that the benefits of 4G connectivity are more widely felt in every corner of the UK.”
The study is available here, and quotes from fisherman, farmers, and filmmakers in the various sample communities.
