February 14, 2013

Three and Vodafone to Get 4G Boost

Three and VodafoneAs you may know, EE ( which owns Orange and T-Mobile ) were the first company to offer 4G ( 4GEE ) services to its customers in November last year. EE got permission from Ofcom to launch 4G on some of its old 2G ( GSM )1800Mhz frequency spectrum which was no longer needed and re-allocated for 4G mobile services.

Meanwhile, Vodafone, O2 and Three had been waiting in the wings to compete, along with EE and three other entrants, in the 4G auction that is currently underway. The other 3 entrants include MLL Telecom, HKT UK ( a subsidiary of PCCW Limited ) and Niche Spectrum Ventures Limited (a subsidiary of BT Group ). However, they are unlikely to bid for the larger slices of 4G frequency as it is highly improbable they would launch a full blown 4G mobile network but would more likely be bidding to launch 4G mobile broadband services.

The 4G auction continues in secret with Ofcom scheduled to announce the results in the next few weeks. The winners within the 4G auction and the companies which have won which of the 26 slices of the 800MHz and 2.6GHz frequency bands will then be unveiled.

It is unlikely, that either O2, Vodafone or Three will launch 4G before June this year, and, in fact, Three may not launch 4G until September this year or later. Three continue to invest in its DC-HSDPA network which they are calling Ultrafast.  This is the fastest and likely last upgrade that Three can make to its 3G network and is around 2 times faster than a normal 3G network.

4G Booster for Three and Vodafone – the details

OFCOM are holding talks to consider allowing Vodafone and Three’s requests to use their some of their existing frequency spectrum to provide 4G services just as they have done with EE. The plan is that Vodafone want to use their some of their unused 900MHz, 1800MHz and 2100MHz bandwidth( within the 2G and 3G frequency bands ) to provide 4G. Three, on the other hand, want to use some of their 2100 MHz 3G spectrum, alongside the 1800 MHz 4G spectrum they purchased from EE in 2012. Ofcom have previously given the green light for Three to launch 4G within the 1800MHz frequency band with the condition it can be used no sooner than September this year.

We expect Vodafone and Three to succeed in their requests which will enable them to get an earlier foothold in the 4G market than previously expected. It may also enable both companies to purchase less 4G spectrum than they originally anticipated, but not without some risk – the risk being that they won’t know the result of OFCOM’s deliberations until 29th March, just after the auctions conclude.

A decision in favour of Vodafone and Three’s requests can only be good for the consumer. So far, 4G prices are pretty steep and early adopters are paying a premium for EE’s monopoly. The faster the market sees competition, the faster prices will start to fall. In addition, coverage of 4G will improve markedly.

Here at 4G we’ll continue to keep you updated with all the 4G development, phones and auction news as we get it.