FROM THE INDUSTRY
Let’s start with 5G. There’s been so much noise about it for years now. Has it lived up to the hype? The million-dollar question. Our view is that the progressive evolution of each G matters less and less to consumers. If you think about it, your 5G and 4G phones – you don’t really know the difference in everyday use. The reality is it doesn’t dramatically change your life, but without it, you wouldn’t have the same life. It’s mainly about capacity. The industry always has to build additional capacity because demand keeps rising. But in terms of what it realistically does for the average person? It’s becoming like the air we breathe – we take it for granted, which is probably a good thing. So what has 5G actually given us? One tangible benefit is the number of devices that can be connected. When you tap your phone to pay for things, which you can do everywhere now, that’s partly because 5G networks can handle so many more connected devices than 4G. But here’s the thing – I don’t get excited talking about that, and neither do consumers. It just works, and we’ve moved on to focusing on other things.
Why does 5G have such a bad reputation among users? Because the experience varies wildly depending on where you are. If you’re in South Korea or the Middle East, you might perceive a bigger difference. But in the UK? It’s been deployed as a very thin layer distributed on top of existing infrastructure. I personally preferred to switch to 4G manually rather than being stuck on a 5G network a year and a half ago – it had almost no bandwidth. People think, “How can this be 5G? It’s rubbish!” And if you don’t know the technical reasons behind it, that’s exactly what you’d think. What are those technical reasons? Multiple factors. 5G was allocated a lot of higher spectrum frequencies, which struggle with obstacles. Even a glass wall can cause enough reflection to degrade service significantly. Add in London’s cement structures and noise from everything else, and you’ve got challenges. But the bigger issue is investment. Mobile operators have faced deflationary pressures for years. They tried to peg services to inflation-plus, but competition was so intense that overall revenue went to a minimum. They didn’t have much to spend on capital expenditure, so what we saw was often the minimum deployment required to say “we have 5G.”
People also aren’t rushing to buy new phones anymore. Is that related? Absolutely. We do big surveys across 19 countries every year, and the data is striking. In the UK, 54% of people now have a device older than one year. Back in 2019, pre-COVID, it was only 42%. That’s a significant 12% shift. People aren’t rushing to buy new phones because the physical device matters less. What we do rush to download are new applications. It’s becoming much less about hardware and more about software. Look at the latest Google Pixel – there’s hardly any discussion about the technical quality of the physical device. The big thing? It’s got AI. That puts pressure on the second-hand phone market obviously. Exactly, and this is where it gets really interesting. There’s actually a demand for second-hand phones that’s not being met by supply. People are holding onto their devices longer, which delays phones entering the second-hand market. The second-hand market is growing at double- digit rates, but it’s probably not growing as fast as it should be given the demand. There’s actually a bit of scarcity in some markets.
Volume 47 No.4 DECEMBER 2025
57
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