The UK is already seen as Europe’s most complex and fragmented telecom market, and it now looks set to add another unwanted title to its repertoire as that of Europe’s 4G laggard.
Europe’s telecom markets are already dividing into two camps of 4G “haves” and “have-nots” and the UK lies firmly stuck in the latter.
The auction proposal set out yesterday by Ofcom means that the UK will not see 4G LTE services go live until later in 2013 at the earliest, putting UK mobile consumers almost four years behind the world’s leading 4G markets.
Four years may not seem a significantly long period of time, but it is the equivalent of light years in the fast-paced mobile market. To put things in context, 4G adoption in Korea has already reached 17% of mobile users today; by the time the UK takes its first baby steps forward in 2013, it’s reasonable to expect that Korea will have taken a giant leap towards 50% adoption.
But being late to market with 4G is not necessarily all bad news. UK mobile operators and consumers alike will benefit from the fact that 4G in late 2013 will be a more mature technology, providing major benefits in the shape of a more stable technology, a greater range of devices and significantly lower equipment costs due to increasing economies of scale.
Ofcom’s auction design is championing consumer interest in the form of lower prices for mobile services above all other considerations. This is particularly evident by Ofcom’s decision to reserve spectrum for a fourth national network operator. Hutchison 3G is the most likely candidate, but there are other wildcard options that could also be waiting in the wings and ready to swoop.