4G – EE contract now or wait for the competition?

THE 4G FUTURE

At the moment, 4G is expensive, but will prices fall after the auction is completed and competing services are up-and-running? Under the auction rules, none of the bidders are able to reveal details until after it has finished, but we still contacted each of the major network providers to see what they had planned for their 4G rollouts.

VODAFONE

“We are planning to launch our 4G in the Spring and we intend to use a signal that travels further into your home than any 4G signal that’s available now, all things being equal, but we cannot say anything more than that at this stage.” – Vodafone

Vodafone plans to use the 800Mhz frequency for its 4G service, which should provide greater indoor coverage than networks operating on higher frequencies. The company has committed to providing 98% indoor coverage to its 4G-equipped areas, which could give it the edge over EE – we noticed a distinct lack of 4G coverage at certain points in our office when using an EE SIM.

Vodafone is also the only network provider which owns its fibre network – the others all lease the fibre connecting individual phone masts to the rest of the grid, meaning it has greater control over maintenance and upgrades. Existing Vodafone customers that have a 3G contract with either the iPhone 5, Galaxy S3 or Galaxy Note 2 are eligible for a discount when switching to a 4G contract next year, taking 70% off the remaining contract charges and potentially saving hundreds of pounds over the cost of early cancellation.

O2

O2 is planning to work in partnership with Vodafone for its 4G rollout, but that doesn’t mean the two providers will be merging their services. They will simply help construct the 4G network, halving the time it would take to do so individually, then run their own 4G services separately on a different frequency. The company claims it will achieve 98% indoor and outdoor coverage by 2015, a year before that figure becomes a mandatory requirement by OFCOM.

A whole new generation of masts won’t be cheap, so O2 and Vodafone are working together

It too will be offering an upgrade scheme, but only for Apple’s iPhone 5 – existing customers will be able to escape their contract with a 25% discount and the option to recycle their handsets for even more money off. We already know that the iPhone 5 won’t work on either Vodafone or O2’s forthcoming 4G networks, as it is only compatible with the 1,800Mhz frequency used by EE, so there’s no reason to hold onto your old handset when upgrading to 4G.

THREE

Three, the network that launched the UK’s first 3G service, is hedging its bets with 4G; we spoke to Hugh Davies, Director of Corporate Affairs, who explained that the company was still in the planning stages but had already signed a deal with EE to lease the 1,800MHz frequency band. Although there are “are all sorts of numbers being passed around” with regards to individual frequencies, Davies says the spectrum auction is far from guaranteed. With the 2,100MHz frequency band potentially overlapping with radar systems and Freeview broadcasts, there needs to be thorough conflict checking before the auction winners can roll out their 4G services.

“Three will definitely include LTE services in Q3 next year,” Davies says. “4G is great, it’s part of the whole mix”, but “Three will also stay focused on improving HSPA+” rather than push forward with super-fast LTE in a few main areas. Whereas EE expects to cover 70% of the UK by the end of 2013 with its 4G service, Three plans to cover 80% with its HSPA+ network as early as Q1. To the end user, in areas where capacity is key, the differences between the two networks can be as little as 3Mbit/s. Because of this, Three customers will only need to look out for an “Ultra-Fast” contract next year, as the company isn’t planning to split its service between 3G and 4G offerings.

VIRGIN

Finally, as a Mobile Virtual Network Operator (MVNO), Virgin Mobile currently leases its 3G network from EE. This means it doesn’t currently own any dedicated frequencies, but shares them with EE to save money on maintenance and installation. However, that may change when 4G launches – Virgin performed LTE trials in early 2012 on the 2,600MHz frequency band, so will likely be gearing up to enter a bid in the spectrum auction and set up its own 4G network. Given that it doesn’t have existing 2G and 3G hardware to build on, we would expect Virgin to introduce 4G in major cities but rely on the older networks for more rural areas. That said, its huge base of customers with fast, cable broadband puts it in a good position to market 4G services as part of its packages.

Virgin may be able 4G to its existing cable broadband customers