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4G Or Not 4G? That Is The Question (Part 2)

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We’re not going to be seeing 4G reach of 98% of the population until the of 2014

Now look at what happened after that. Hutchison Whampoa’s 3 network remains intact. Orange was bought by France Telecom; BT Cellnet became O2 and, in 2005, it was bought by the Spanish telecommunications company Telefónica; One2One, which was bought by Deutsche Telekon a year before the auction, changed its name to T-Mobile in 2002. Only Vodafone has remained a British company.

Only users on the EE network will benefit from 4

Only users on the EE network will benefit from 4G

However, this is more than a lesson in European companies taking over British ones. That $36bn was a major burden on UK telecom firms (and it has to be said that the German one fetched even more money) and it pulled a lot of investment away from infrastructure. Ideally, that cash would have been diverted into providing better services and boosting the networks and their ability to compete effectively.

So why have lessons not been learned? Why are we sitting here with a 4G auction getting underway that will drag more billions out of the system? Already the system has been badly dealt with, leaving only EE happy and all it’s doing is putting all the power in the hands of one company for the time being and making its rivals wait, losing valuable innovation and investment time in the process.

It was quite clear from the start that the networks would not find a happy medium. There is barely enough spectrum for all four UK operators and none of them really wanted to be dragged into the auctioneering that proved so damaging the last time.

There’s an argument that perhaps the mobile phone companies should have avoided all of this completely and stuck with 3G, spending the cash on increasing the coverage of the third generation and using the spare capacity - of which there is enough - to see them through for a few more years.

With Wi-Fi becoming such a force and talk of setting up UK-wide Wi-Fi hotspots and public Wi-Fi initiatives, steps have been taken towards realizing the dream of a countrywide Wi-Fi network, albeit a rather disjointed one. Accessing Wi-Fi in busy towns and cities is relatively easy - you’re often no more than a coffee shop or fast food outlet away - and it’s rather telling that the 4G roll out will be equally limited.

EE will launch the UK’s first mobile 4G network in London, Birmingham, Cardiff and Bristol first and another 12 cities by the end of the year. According to EE, this will cover a third of the UK population. However, we’re not going to be seeing a reach of 98% of the population until 2014 and even then, this is dependent on it winning a sufficient part of the 900MHz spectrum available in a forthcoming auction. Woe betide those living in northern Scotland and parts of eastern England too. They will miss out on the initial 4G roll out.

27 million customers will potentially benefit from speeds that are up to five times faster than 3G

Perhaps the cash would have been better spent on Wi-Fi. It’s growing in popularity and people with 4G will no doubt still seek Wi-Fi in order to conserve their data. In 2007, just 700,000 people used Wi-Fi hotspots according to a report by the Office of National Statistics. In 2010, that had grown to 4.9 million. It said that represented 13% of internet users, connecting in restaurants, cafes, hotels, airports and many more locations. It begs the question why companies are rolling out 4G rather than sorting out the Wi-Fi coverage? Vodaphone is spending $40bn across Europe on its 4G network and yet analyst Mobidia says 70% of smartphone internet traffic is via Wi-Fi in the UK and Informa says just 19% is via a mobile network. People are wary of the data plans, Wi-Fi is faster and people like the convenience.

Not everyone is unhappy at the way things are turning out

Then again, would the country not benefit more from the massive windfall secured on the back of the auctions? Again we should go back to 2000 when the $36 billion windfall amounted to $640 per person in the UK. Instead of going all out and splurging the cash on millennium projects - at a time when the country was relatively buoyant - Chancellor Gordon Brown used the money to pay off national debt. That said, the cash wasn’t even handed out up front, with license winners having the option of paying in instalments over 20 years, paying just half straight away.

Confederation of British Industry (CBI) believes the roll-out out of 4G by EE will be a boost for UK business.

Confederation of British Industry (CBI) believes the roll-out out of 4G by EE will be a boost for UK business.

With the country in a financial mess and debt needing to be reduced, the money generated from the new auction will not go into boosting technology or creating a better climate for business. Most likely, it will be ploughed into paying off national debts.

Still, not everyone is unhappy at the way things are turning out. The Confederation of British Industry (CBI) believes the roll-out out of 4G by EE will be a boost for UK business. “The availability of 4G by EE by the end of the year will be a huge improvement. We always hear from businesses that any improvement in bandwidth and connectivity can have a rapid improvement on their businesses operations,” said John Cridland, director-general of the CBI. However, he incorrectly stated that it would help rural areas, but they don’t appear to be part of the immediate plan.

A CBI survey, however, showed that 79% of the 568 respondents said they were confident or somewhat confident the next five years will see improvements in the digital networks in the UK. 27% said they thought the UK is below average when its infrastructure is compared to overseas rivals.

It was a shrewd observation, for while it is utterly vital that a solid digital network is created - and we must applaud the introduction of 4G - it cannot be at any expense. It cannot be in place of other technologies and services. The way the auctions have been run so far suggests things are not quite as smooth and pre-planned as you would hope, so we can only sit back and wait, hoping that 4G doesn’t stretch phone companies so much that we all suffer.

How fast is 4G?

 

3G

4G

Data Throughput

Up to 3.1 Mbps

3Mbps to 5Mbps but potential estimated at a range of 100Mbps to 300Mbps

Peak Upload Rate

50Mbps

500Mbps

Peak Download Rate

100Mbps

1Gbps

Switching Technique

Packet switching

Packet switching, message switching

Network Architecture

Wide Area Cell Based

Integration of wireless LAN and wide area

Services And Applications

CDMA 2000, UMTS, EDGE etc

Wimax2 and LTE-Advance

Forward Error Correction (FEC)

3G uses Turbo codes for error correction

Concatenated codes are used for error corrections in 4G

Frequency Band

1.8 - 2.5GHz

2 - 8GHz

Download Speeds

These speeds are hypothetical in that they depend on where you are, what kind of device you have and the signal strength, but they indicate the sort of time you can expect to wait when downloading files of different sizes.

 

100KB

250KB

500KB

1MB

1GB

56k Modem

15 seconds

36 seconds

1 minute

2.5 minutes

1 day 18 hours

3G

<1 second

6 seconds

12 seconds

25 seconds

7 hours

4G

<1 second

1 second

3 seconds

5 seconds

1.5 hours

 

 

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