It has been an exciting week for the UK, as the country’s first commercially available superfast 4G LTE service launched across 11 major cities.
EE, the joint venture formed by Orange and T-Mobile UK, received approval to roll out the service ahead of competitors Vodafone, O2 and Three after months of legal disputes over spectrum auctions.
“Today is a landmark day for our company, the UK mobile industry and, most importantly, the country’s businesses and consumers,” said Olaf Swantee, CEO of EE, the 4G brand of Everything Everywhere.
“We’re investing £1.5 billion in our network to be the first company to offer mobile 4G in the UK, alongside the biggest 3G network.”
The service is initially available in Bristol, Birmingham, Cardiff, Edinburgh, Glasgow, Leeds, Liverpool, London, Manchester, Sheffield and Southampton. EE has reused spectrum it already owns, enabling it to launch the service months before its rivals.
This launch brings the UK closer to other countries that have offered LTE networks for some time. Research from EE indicates nearly three-quarters of UK businesses plan to adopt the improved connectivity that 4G enables in the near future.
However, EE’s pricing has attracted criticism from consumers, who argue that the minimum tariff of £36 per month could allow only limited high-definition streaming before data allowances are consumed.
The operator defended its pricing as aligned with typical demand. EE said average usage on a £36 monthly plan on its Orange 3G brand was slightly above 400MB.
“EE provides many more options for customers who have a heavier data requirement,” a spokesman added. “Our top plan with an 8GB data limit provides customers with eight times more data than is used by an average unlimited user today.”
Industry analysts say the pricing gives insight into the operator’s future strategy. Steven Hartley, principal telco strategy analyst at Ovum, noted that while EE’s pricing positions the brand at the higher end of the market, the premium is lower than launch prices for LTE seen in many other countries. That suggests EE may actively target its rivals’ most valuable customers.
“Considering the high premiums charged for LTE at launch by other European operators, EE’s proposition is refreshing, even if it will not appeal to everyone’s budget,” Hartley said.
Despite concerns about cost, the launch is likely to be welcomed by many UK businesses and consumers. By granting EE permission to go live, UK regulator Ofcom has reignited a process that will require rival operators to buy remaining 4G spectrum in an auction next year — an auction that was delayed several times amid stakeholder disagreements.
EE has committed to rapidly expand coverage, adding 2,000 square miles each month, bringing four more cities online by the end of the year and reaching 98% UK coverage by the end of 2014. Those targets will likely increase pressure on competitors to finalise spectrum acquisitions as soon as possible.
For more details about LTE developments, see the LTE conference at Telecoms Tech World on 4–5 June.