4. 5G challenges and future directions in the Nordic-Baltic region: Insights and learnings

Several insights emerged from the discussions and experiences shared in the online project events and final panel discussion regarding the challenges and opportunities of 5G development in the Nordic-Baltic region. The rapid pace of technological innovation and digitization in the Nordic and Baltic countries has established them as front-runners in these domains. Despite this progress, certain factors have hindered the full realization of 5G’s potential, raising questions about its added value in the region. While some challenges are common to all sectors, others are more specific.

Table 4 systematically organizes the key challenges identified for each of the four verticals into the following categories: uncertain business cases; financial hurdles; technical/infrastructure limitations; regulatory constraints; security/privacy/ethics issues; acceptance/usability (demand-side) barriers; and collaboration challenges.

Table 4. Key challenges in 5G implementation across various sectors in the Nordic-Baltic countries

5G Challenges	Health	Transport and mobility	Industry	Media and Broadcast
Uncertain Business case	Lack of a clear business case (major market players struggling to see 5G’s evident advantages). Importance of validating the technology’s efficiency for the sector (added value of 5G).	Business case viability remains limited, despite the potential for significant cost-savings in terms of staff costs linked with automation (e.g. staff costs savings related to automation in the maritime sector might not be enough incentive, as such costs are not the most expensive part of the operation).	Importance of clearly articulating the value proposition of 5G technology to stakeholders – both big companies and SMEs.	Technological development progresses rapidly, and services/new business models development do not always keep pace.
Financial hurdles	Public healthcare systems limit the financing of early-phase developments and testing of new 5G-based applications.	Requires substantial investment in 5G infrastructure in specific areas (to ensure comprehensive coverage, reliability and bandwidth).	Expensive, unclear pricing, and the industry sees limited incentives to invest.	Infrastructure investment required poses financial challenges for media enterprises, particularly smaller organizations with limited resources.
Technical/Infrastructural limitations	Current 5G implementation may face limitations in real-time services, such as video transmission, due to latency issues, which can affect the reliability and usability of 5G-enabled healthcare applications like remote examinations and vital signs monitoring.	Reliance on high-speed data transmission necessitates robust 5G network coverage, which may pose implementation hurdles in areas with limited infrastructure.	Limitations on geographical coverage.	Despite technological advancements, latency remains a persistent issue. Asymmetry between upload and download speeds in commercial 5G networks requires additional technical solutions.
Regulatory constraints	Need for strong confidence that medical procedures and technology developments align with regulations.	Uncertain legal responsibility for autonomous vehicles.	Feasibility of sharing data across the value chain. Importance of aligning regulatory and industrial objectives. Importance of establishing tailored regulatory frameworks to address each sector’s unique needs.	Spectrum allocation from regulators is crucial. Vital to ensure QAS guarantees and network slicing. Overall importance of developing commercial network support for professional services.
Security/Privacy/Ethics issues	Questions concerning data privacy and management.	Security concerns linked to importing and installing 5G equipment from non-European sources. Ensuring GDPR compliance. Robust cybersecurity measures required to safeguard against unauthorized access and potential intrusions into UAV systems.	Security issues related to data-sharing throughout the value chain.	Data security and privacy in the context of personalized content delivery.
Acceptability/Usability (demand-side) barriers	Simplification deemed crucial for widespread adoption beyond research trials: ‘It needs to be less complicated than when researchers are running the trials’.	Uneasiness concerning safety features of autonomous vehicles. Resistance from communities regarding installation of base stations and antennas in their buildings (linked to perceived health risks, aesthetic impacts and property values).	Considerations linked to job market impacts and human substitution.	User acceptability linked to digital capacity/inclusion (exclusion).
Collaboration challenges	Crucial need to identify collaborative opportunities.	Cross-border collaboration seen as a challenge with a central role to play in the successful deployment of 5G applications in mobility and transport (land, maritime, air).	Complex ecosystem means collaboration can be difficult to achieve due to, for instance, competitive dynamics and security/privacy concerns.	Coordinating and aligning the interests/priorities of diverse stakeholders can be complex, especially when they may have different goals, timelines and resources.

Source: Insights from the first four 5G N-B MT project events

It is useful to contextualize these sectoral findings based on the discussions that took place during the fifth and final 5G N-B MT project event, which point the way to potentially important recommendations. Overall, a number of considerations stand out:

Recognized potential of 5G: There is overwhelming consensus around the potential impact of 5G technology deployment on various industries, as well as its effect on Nordic and Baltic societies more broadly.

Uncertain business case for 5G-based innovation: What is more limited is empirical validation for this potential, as well as assessment of its impacts and the specific requirements for each sector. Even if 5G is seen as a game changer for a new digital society, companies and organizations often struggle to justify investing in 5G technologies due to unclear returns on investment and market demand. The question remains: Who is prepared to invest in the expensive deployment of 5G technology despite the uncertainty surrounding potential returns? This calls for further discussion concerning 5G’s added value for the connectivity of society as a whole, which could justify the need for policy intervention.

Importance of clear market signals for investment in 5G: Market immaturity, combined with the ambiguous business case for 5G, raises several issues that make investment uncertain. The costs of deploying 5G infrastructure, acquiring spectrum licences and investing in R&D may be prohibitive for many stakeholders. This points to the need for a clear policy direction on both infrastructure deployment and expansion, thereby supporting business development and reducing uncertainty by sending the right signals to the market. Essential steps to stimulate investment and drive the adoption of 5G technology include creating an enabling environment for innovation; fostering collaboration between public and private stakeholders; promoting digital literacy; and investing in education/training programmes to address workforce shortages in the digital and technical skills needed to develop the 5G ecosystem.

Network coverage and digital divide: Another key factor in the discussion is network coverage, which is essential for consistent high-speed data transmission. There may be insufficient commercial interest in rural and underserved areas that lack sufficient commercial viability (particularly in sparsely populated areas), thereby exacerbating existing ‘connectivity divides’. This points to the need for additional investment to support infrastructure development, as well as the importance of a clear strategy to drive roll-out and improve connectivity. There is also a need to clarify the role of government in ensuring the availability of mobile services and promoting cooperation.

Regulatory issues and the importance of an enabling environment: At the forefront of discussions are a mix of technical, infrastructural and financial challenges, intertwined with regulatory constraints on, among other things, spectrum allocation and licensing requirements. Several stakeholders emphasized the cumbersome nature of addressing issues related to infrastructure constraints, regulatory frameworks and security, as well as the importance of policymakers and regulators working closely with industry stakeholders and other actors to develop tailored regulatory frameworks.

Security, privacy and ethics issues: These include security concerns related to cybersecurity and component standards, privacy concerns regarding the use of personal data and GDPR, and ethical concerns centred around accountability, trustworthiness and reliability among stakeholders. Such issues are closely linked to regulatory challenges. Effectively addressing these challenges requires a comprehensive approach focused on accelerating cybersecurity standards; promoting critical thinking and communication about data practices; improving consent mechanisms; and fostering accountability and trustworthiness among stakeholders.

Acceptability and user-friendliness barriers: Simplifying 5G technology applications for broader adoption beyond research trials is crucial. Addressing community resistance, including concerns about the perceived health impacts of 5G and security issues (namely autonomous vehicles), requires robust regulatory frameworks and public awareness campaigns. Engaging communities to address concerns regarding base stations and antenna installations was also highlighted in discussions, particularly the importance of transparent communication in addressing perceived health risks and aesthetic impacts. Additionally, ensuring digital capacity and inclusion was seen as a possible means of tackling user acceptability issues, underscoring the importance of promoting digital literacy and investing in education and training programmes.

Collaboration at the centre of discussions: There is a common understanding that collaboration between different types of stakeholders is vital to identifying and capitalizing on 5G applications, thereby bridging the gap between pilots and market applications. It also points to the relevance of including different actors beyond regulators and operators in discussions. Regional actors, such as universities, municipalities and even property owners, are sometimes missing from discussions, which can limit debate. In this regard, collaborative forums, dialogue sessions and regular thematic roundtables can facilitate a more inclusive, fruitful exchange of ideas.

Interrelated nature of challenges: The highlighted findings are intended to summarize the main issues and discussions. At the same time, it is important to recognize the interrelated nature of the challenges. For example, lack of a viable business model can have a direct impact on infrastructure investment, resulting in limited coverage and capacity, in turn restricting further business development. Even when attempting to narrow the discussion down to a specific vertical or sector, some juxtapositions are inevitable. For example, looking at smart cities means looking at automation and mobility, healthcare and so on. While sectoral perspectives are valuable, it is important to take a systemic view. As such, the holistic and multi-dimensional nature of these challenges should not be overlooked when addressing policy interventions.

Research gaps and the way forward: It is important to note that several important issues remain on the sidelines of the discussions covered in this report, particularly those related to labour market transitions, skills development and the environmental impact of 5G technology deployment. This is partly related to the report’s methodological limitations, as the findings presented are based on the keynote presentations given at the project events. A more in-depth, systematic analysis could potentially provide more detailed recommendations tailored to each sector. At the same time, it highlights the existing gaps in knowledge around these issues, and underlines the need for further research, especially given the importance of these questions for policymakers. Developing a pragmatic understanding of 5G deployment practices is essential to effectively navigate potential pitfalls and ensure successful implementation in different contexts.

Overall, our review provides an insightful overview of the key concerns within the 5G ecosystem. While our focus was on the Nordic-Baltic countries, the challenges and opportunities associated with 5G deployment do not appear to be unique to this region. During the events, several European participants expressed similar concerns. The findings and policy implications discussed here can therefore serve as insights for policymakers and stakeholders across the EU.