U.K.-based wireless operator EE announced plans to commercially launch its “double-speed” LTE service across a dozen markets on July 4. The carrier explained that the offering will provide theoretical download speeds as high as 150 megabits per second, though average speeds will be closer to 30 Mbps.
The lucky markets include Birmingham, Bristol, Cardiff, Derby, Edinburgh, Glasgow, Leeds, Liverpool, London, Manchester, Nottingham and Sheffield.
EE announced earlier this year plans to increase LTE network speeds with the increase of 1.8 GHz spectrum dedicated to its offering from the current 10 megahertz to 20 megahertz. EE, which is a joint venture between France Telecom’s Orange and Deutsche Telekom’s T-Mobile brands formed in 2010, was the first U.K. operator to rollout LTE services late last year after having garnered permission from telecom regulator Ofcom to use its 1.8 GHz spectrum band for LTE services. That band was initially set aside to support only GSM-based 2G services.
Ofcom recently concluded a spectrum auction of licenses in the 800 MHz and 2.6 GHz band set aside for “4G” services that generated $3.5 billion in winning bids. EE spent $896 million for 10 megahertz of spectrum in the 800 MHz band and 70 megahertz of spectrum in the 2.6 GHz band that it said it plans to use to further supplement its LTE services.
EE rival Vodafone UK last month announced plans to increase spending on its LTE network by as much as 50% in an attempt to launch services by late summer. The carrier said it was on track to spend nearly $1.4 billion on its network this year, not including the $1.2 billion the company spent on spectrum during the country’s spectrum auction. That haul included 20 megahertz of spectrum in the 800 MHz band, 40 megahertz in the 2.6 GHz band and 25 megahertz of unpaired spectrum in the 2.6 GHz band. Analysts noted at that time that Vodafone UK needed to be aggressive in acquiring spectrum in order to regain market share in the country’s hotly contested mobile space.
EE promotion
EE also announced that beginning July 17 it will expand rate plans compatible with its LTE network, including shared plans and a pay-as-you-go option. The shared plans will allow up to five devices to share a bucket of data for between $18 and $40 per month depending on device. The pay-as-you-go option will start at $23 per month for a SIM card loaded with 2 gigabytes of data accessible for 30 days.
The carrier added that customers that sign up for access to its LTE network between July 17 and Sept. 30 will also receive larger data buckets.
Analysts were more bullish on the promotion offering than the faster network speeds, noting the move should give the carrier a competitive edge in the market.
“Fleshing out its shared plans for customers, and positioning it as a way for families to save money, is a canny move in today’s austerity-dominated society,” explained Emeka Obiodu, principal analyst at Ovum, in a report. “The ability to cap costs should appeal to families who will get better clarity on what their telecoms spend will be. We also liked how EE is going to use the shared plans as a nudge to push customers into a higher-prized plan. This is what Verizon Wireless has done successfully in the [United States] and is one reason why their [average revenue per user] is rising.
“For EE, offering pay as you go LTE is a tactic to corner the market for sporadic users of mobile broadband. It is safe to assume that other telcos will want to lock customers into some sort of contract and so EE could tap this opportunity for a while.
“The doubling of LTE speeds in several cities across the [United Kingdom] is a nice headline. But, on its own, we don’t believe it is a standout game changer as telcos struggle to sell LTE as a speedier network. Instead, its merit is that it gives EE a base from which to offer LTE packages tiered on speed and usage which are far acceptable to customers. That is going to be the interesting thing to watch out for and if its rivals do not have the capability to do that, EE could have quite a solid marketing message.”
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