Why LTE networks are like buses

There has been some major developments in the UK LTE market today as the regulator Ofcom announced that it will permit Everything Everywhere (the Orange/T-Mobile merger) to re-farm its 1800MHz spectrum for use with LTE. Ofcom has now issued “varied licences to EE which authorise LTE services from 11 September 2012”, and it has told Telecoms.com that it had plans to launch in “certain key locations in the UK by the end of this year”.

The results – howls of protest from the EE’s UK rivals. Their issue is that as they don’t hold licenses for 1800MHz they will have to wait for next year’s auction, currently set to start at the start of 2013, for the chance to bid for 800MHz and 2600MHz spectrum. This could put them almost a year behind in the LTE marketing stakes.

Ofcom said its decision was because, “delaying doing so would therefore be to the detriment of consumers.”

Vodafone though has said quite the opposite claiming that, “the regulator has shown a careless disregard for the best interests of consumers, businesses and the wider economy through its refusal to properly regard the competitive distortion created by allowing one operator to run services before the ground has been laid for a fully competitive 4G market.”

Analysing this, Vodafone is trying to suggest that consumers will be better served by having them wait for everyone to launch at once – which doesn’t really hold up. Certainly EE will have a competitive advantage by offering LTE first as there’s serious pent up demand for LTE. Yes, in the long term, consumers will be able to benefit even more from competition in the market once the rest of the players get hold of spectrum via the auction but undoubtedly they will benefit by having access to it as soon as possible

Of course, it won’t matter who has an LTE network if the devices aren’t there. As Informa’s Principal Analyst Thomas Wehmeier says, “Another critical task that lies ahead for EE will be to convince the world’s leading device manufacturers to build smartphones for their network. You can build the network, but without the right devices the customers cannot and will not come”

On the mobile broadband side, it shouldn’t be too much of a problem as the device eco-system is growing, ZTE is producing 1800MHz dongles for CSL in Hong Kong for example. But on the devices side it’s a bit more limited. In Australia, Telstra is offering the HTC One XL, Velocity, the windows-based Titan 4G, and the Samsung Galaxy SII. However, the flagship Galaxy SIII is not LTE 1800 capable. The other big one of course is the iPhone 5. No one knows what that will support LTE at all, and if it does, at what frequencies, but if 1800 is in there, it will be a massive win for EE. (If not Apple and EE will have to be careful, to avoid the hoopla around the iPad’s 4G incompatibility with European and Australian LTE).

What’s really interesting is this from Informa’s Wehmeier. “The ruling issued today applies to the full chunk of 1800MHz spectrum that Everything Everywhere owns in the UK, including the 2x15MHz that it is being forced to divest as a result of conditions imposed on the Orange-T-Mobile merger by the European Commission. The clarity on the potential use of that spectrum will provide fresh impetus to the sale negotiations with Hutchison 3G (3) the clear favourite to land the spectrum. The sale must be finalised by 30 September 2012 meaning the UK could conceivably see two 4G networks up and running by Christmas.”

So after years being behind the 4G curve we may get two networks at once. It’s a funny old world.

Wishing on an LTE star: LTE in the UK finally on its way

For a couple of years, any mention of holiday in the LTE blogger’s house brings the same question from the kids: “are we going to Disneyland?” So far, their hopes have been dashed and they have had to instead listen to their friends having all the fun. Once again, this year we’re not going to Disneyland. Actually, we’re going to Norfolk. No, it’s not the same.

It’s a little like LTE in the UK (bear with me on this). Do we have LTE yet, some ask? No, we don’t, and we’ve had to look on enviously as those in the US, and some places such as Sweden, Norway and Germany, have had faster data available to them. It certainly came as a shock to those who didn’t realise that the new iPad’s 4G LTE was not and would never be, compatible in the UK.

Excitingly though, things could be very different by the end of the year. I predict an LTE iPhone, and Android alternatives too, and networks to run them on too.

The signs are good. We’ve got the auctions set up for early next year with spectrum in the 800MHZ and 2.6GHz frequency ranges up for grabs. But what’s this? Everything Everywhere, the UK joint venture between Orange (France Telecom) and T-Mobile UK (T-Mobile), has some spare 1800MHz spectrum lying around? And it wants to use this for a live, actual, real-life network in the UK by the end of 2012? OK. I’ll have some of that.

Exciting as that is, just today I talked to UK Broadband CTO Philip Marnick who told me that come September, the UK subsidiary of Hong Kong’s PCCW plans to have the first commercial network in the country live by September 2012. Admittedly its LTE coverage will be limited to small areas of South London, and a trial area in Reading, but it’s still pretty exciting. LTE in the UK is starting to actually happen.

In addition, this week France Telecom said that it was committed to bringing LTE to ten countries across Europe by 2015 (including its commitment in the UK under the Everything Everywhere brand). That means that by the time we actually do get to Disneyland Paris, they’ll be LTE there too. Double win.

As far as the Everything Everywhere announcement goes it has so far met with the UK regulator Ofcom’s approval, much to the consternation of the other networks, who argue that it goes against Ofcoms’s stated aim of promoting fair UK LTE competition by letting one of them go first. You can understand their viewpoint, but what could spur competition more than the other networks knowing they need to get their LTE houses in order as quickly as possible in order to get themselves competitive?

It might not be in their interest but I think it could be for the UK consumer. The punter gets a national LTE option early, and prices can come down quickly as soon as other others get in the game.

When that happens we’ll no longer be lumbered with the frankly Mickey Mouse 3G networks we rather goofily think of now as mobile broadband and instead be quickly transported to the magic kingdom of LTE.

Philip Marnick from UK Broadband will be speaking at the LTE World Summit is taking place on the 23-24 May 2012 CCIB, Barcelona, Spain. Click here to register your interest.