Skip to main content

UK 4G Mobile is a Solution in Search of a Problem

It's not economically viable to upgrade the current UK mobile broadband networks to address traffic demands and improve user experience until 2015, according to the latest market study by Informa Telecoms & Media.

Due to the dense deployment needed to meet coverage requirements, UK HSPA networks will be able to handle current and future traffic demands in the medium-term. Informa does not expect traffic congestion to start appearing until 2013 -- and even then only in certain high-usage areas.

As such, Informa believes that large-scale 4G LTE deployments are not a required solution, unless user behavior changes significantly -- putting additional strain on mobile broadband networks.

"UK mobile broadband operators are faced with fierce competition while margins from voice are shrinking. Even though there is growing demand for mobile data by smartphones and USB modems, current UK mobile network deployments are so dense that it would make the introduction of LTE both an investment heavy and somewhat unjustifiable decision," said Dimitris Mavrakis, a senior analyst for Informa Telecoms & Media.

By upgrading current HSPA networks, UK mobile operators will be able to meet traffic demands and alleviate capacity constraints until 2015, after which the upgrade to LTE may be justifiable -- since economies of scale for hardware will have reduced infrastructure costs. Plus, a complete LTE ecosystem will be established, including handsets and portable devices.

Informa estimates that a new LTE deployment will cost an additional $58 million compared to upgrading existing networks, assuming that the LTE deployment begins during 2013.

According to Informa's assessment, the cost of each gigabyte (cost/GB) of traffic on the network is $6.5 during 2011, gradually declining to under $2 during 2015.

Given that network deployment is primarily coverage driven and networks are densely deployed, there is significant unused capacity in the network throughout the forecast period, increasing cost/GB above average values.

Popular posts from this blog

The Billions Bet on Tentative AI Demand

Gartner's latest worldwide IT spending forecast exposes a trend every CIO has already felt in budget negotiations. Total spending will climb 14.2 percent in 2026, reaching $6.37 trillion. It seems that the IT infrastructure market is simply having a strong year. However, the more useful insight is how unevenly that growth is distributed. The Headline Number vs. The Real Story Data center systems and infrastructure as a service (IaaS) are absorbing capital at a pace several multiples faster than devices, communications services, and traditional IT services. This is not incremental growth spread across a healthy portfolio. It is a wholesale reallocation of enterprise technology budgets toward AI infrastructure, made on the expectation that demand for AI workloads will justify the outlay before that demand has been fully proven. Where the Money is Going Data center systems are forecast to grow 62.5 percent in 2026, that's up from 51.6 percent growth in 2025, reaching $822 billion....