Britain has 4G competition as operators jump from one to three

Reuters News
Posted: Aug 28, 2013 7:07 PM
Britain has 4G competition as operators jump from one to three

By Paul Sandle

LONDON (Reuters) - Britain will catapult into the superfast mobile top division on Thursday when operators O2 and Vodafone finally launch 4G services to compete with market leader EE.

The arrival of two more operators offering speeds more than five times faster than 3G - ideal for watching video on the go - marks a sharp turnaround from just a year ago when the country was stuck in the mobile slow lane with no 4G service.

EE, a British joint venture between Orange and Deutsche Telekom, started rolling out 4G in major cities from October 2012 after the regulator allowed it to re-use its existing airwaves.

The move from Ofcom was designed to kick start superfast broadband in Britain, which was falling behind other countries in mobile speeds.

EE took advantage of being first in the field by charging a premium of 10-20 percent on equivalent 3G tariffs, and by rolling out coverage before its rivals started.

It had signed up 687,000 4G customers by the end of June, which it said put it on track to have more than 1 million subscribers by the end of the year.

On Wednesday, it said Accrington, north-west England, was the 100th town to be connected, and with the nine other towns switched on in August, it was now available in 105 towns and cities, covering some 60 percent of the population.

O2 and Vodafone are not strongly competing on price with EE, but are both offering music and sports content in their 4G packages to set themselves apart.

O2 is launching in London and two other cities, while Vodafone is starting off just in the capital.

Three, the smallest operator and last to launch 4G, has said it will not charge a premium for faster broadband.

The Hutchison-owned operator said on Thursday that it would start services in London, Birmingham and Manchester in December, with coverage available in 50 cities by the end of 2014 and reaching 98 percent of the population a year later.

Ronan de Renessa, principal analyst at consultancy Analysys Mason, said he predicted that the UK would be the third largest 4G market in the Europe by the end of 2014 with nearly 8 million connections, after France and Germany.

He said the emergence of 4G operators Three, O2 and Vodafone would mark the beginning of aggressive marketing efforts.

"The UK is in a unique position because it had an early entrant in the market, so the other operators couldn't monetise early adopters," he said. "The market will now accelerate a lot faster than other 4G launches you have seen in Europe."

(Editing by David Evans)