5G has hurdles to negotiate before we’re all up to speed

At a time when the Covid-19 pandemic sees the UK workforce embrace home-working and place huge demand on existing IT infrastructure, 5G continues to be hyped as the UK’s next generation of telecoms technology. Indeed, earlier this year the UK Government reaffirmed its financial commitment to the latest technology that operators plan to roll-out UK-wide.

5G and real estate challenges

5G (5th Generation) is the latest mobile technology designed to further increase the functionality and speed of the current (4G) network. As year-on-year mobile broadband and data use continues to grow massively, UK networks need to expand both geographical coverage and capacity to effectively support increasing demand.

However, crucially to achieve this aim, the network operators now need to install 5G equipment in existing and new locations.

Unsurprisingly, in addition to the significant technical challenges and cost implications for operators, achieving the effective roll-out of 5G technology requires a substantial element of engagement with landowners. This is vital to ensure operators have the appropriate legal rights to install or upgrade 5G equipment where that is not already permitted by agreement or otherwise.

Consequently, where not already permitted, operators will need to enter agreements with such landowners to erect new masts to increase geographical coverage, and to agree rights to upgrade existing sites to 5G to increase network capacity and capability.

However, negotiations between landowners and operators can be time-consuming and contentious. If not sited within publicly adopted areas, even the underground fibre and electricity cables that link 5G back to the core networks require legal rights over land (wayleaves or servitudes, which may be over multiple land ownerships).

The Code

In theory, The Code (the Electronic Communications Code, forming Schedule 3A to the Communications Act 2003, applying across the UK), ought to smooth the legal process for the roll-out of new technologies. Effective from December 2017, The Code replaced outdated legislation and sought to eradicate ‘ransom rents’ from the telecoms market by requiring consideration payable under any new agreements to be assessed on a basis that disregards the use of the site for telecoms purposes. The Code also brought in new rights for operators to upgrade and share apparatus. Potentially good news for 5G, but there are notable restrictions.

If an operator has (since 2017) entered into an agreement to install equipment on land (a Code Agreement) The Code permits that operator to ‘upgrade’ the equipment. However, the ‘upgrades’ required for 5G may well go further than The Code allows (it only permits upgrades where they have ‘no more than a minimal adverse effect on appearance’ and impose no additional burden on the landowner). The issue with the roll-out of new technology is that save for new software or changes within a cabinet, existing equipment will likely change its appearance. In those circumstances, upgrading equipment may require the consent of the landowner.

The Code also allows the operator to share their equipment with other operators (which could assist roll-out), under the same restrictions as for upgrading. Consequently, the same issues and delays arise, where sharing necessitates changes to the appearance of the equipment or additional burden on the landowner.

Disputes and delays

When minimal financial consideration is on offer for new Code Agreements, many landowners are understandably disinclined to cooperate with operators or to engage the help of solicitors or surveyors. Consequently, the 5G roll-out is being further delayed as some negotiations end in dispute.

Notably, operators can resort to rights under The Code to ask the Lands Tribunal to impose on the landowner the rights required; whether to install equipment on a new site or to upgrade or share on an existing site.

Of course, in addition to the above issues, the Covid-19 pandemic will also adversely impact on a timely 5G roll-out due to factors including the shutdown of construction sites, supplier insolvency and limited operations within planning authorities. As a result, the likelihood of a 5G roll-out materialising en masse in Scotland over the next 12 months is unlikely. In my opinion, we will see incremental steps to achieving the 5G vision. There also remains the possibility of further legislative change to The Code if operators can’t roll-out sufficiently quickly to meet demand in the context of the current provisions.

Gillian Wood is a real estate principal associate for Shoosmiths

5G has hurdles to negotiate before we’re all up to speed – Gillian Wood