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3UK: Building mobile data networks is hard to do

Growth i n data usage on 3G networks is relentless, and like other mobile operators in Europe 3UK is focusing most of its energies on meeting this increased demand for mobile Internet services.

But even more for 3, being good at data is fundamental to its future survival as the fifth and smallest operator on the UK market. As data becomes even more of a challenge, the company’s number one priority is to change the perception that it has a weak network.

“We have been a laggard,” said 3UK CEO Kevin Russell at a media briefing in London on Tuesday. “But not any more: we have improved.” Russell added that 3’s average download speeds have improved to 1.4 Mbps from 600 Kbps in Q1 2009.

“We have to be ahead in data traffic,” he stressed. “Our challenge is to make our data services good enough to give people a reason to come to 3.”

Indeed, since data first exceeded voice traffic on 3UK’s network in 2007, the company has been making ongoing efforts to boost its coverage and capacity.

Data now dwarfs voice: CTO Graham Baxter said voice traffic amounts to around 85,000 gigabytes a month, but handset data traffic is twice that level; mobile broadband traffic is 15 times the level of handset data traffic.

The number of handset Internet users increased to 2.12 million by the end of 2009, up from 1 million a year before, and the company is targeting 4 million by the end of 2010. Mobile broadband users are estimated at around 1.4 million users.

On a daily basis, around 75 terabytes of traffic is pushed over 3UK’s network.

“That’s given me quite a number of headaches,” said Baxter “It’s been a roller-coaster ride over the past two years.”

Baxter said that having sufficient sites and spectrum “are the things I worry about; you can’t have enough.”

The company is now addressing how many sites it has, but spectrum is another matter entirely.

At the end of 2008 3UK had just 7,500 sites, but in 2007 the company agreed a network-sharing deal with T-Mobile that has helped it add sites a lot more quickly since then.

Thanks to the combined efforts under the joint venture Mobile Broadband Network Limited (MBNL), 3UK now has more than 10,000 3G sites and is on track to attaining its goal of 12,855 sites by the end of this year – or more precisely on 10/10/10.

That’s the positive news. But 3UK faces a number of challenges this year both at company and industry level, with spectrum being a key concern. As Baxter highlighted, more spectrum will be critical to meet demand for higher mobile broadband speeds. “If you want higher speeds you have got to have more spectrum, and contiguous spectrum at that,” he said.

At company level, Russell said there are still some concerns about the arrangements with MBNL. A key one is that there are exit rights contained in the agreement. “The exit clause is a concern,” said Russell. “That it exists is a concern.”

The other issue relating to MBNL is that T-Mobile is now planning to merge with Orange, and Russell said it will be important to establish if and how Orange’s involvement will impact 3UK’s strategy.

Russell said he could not stress enough how important MBNL is as a future strategic platform for 3. “Any exposure to any risk, how ever remote, needs to be closed off,” he said.

In the wider industry, Russell said there are some big competitive issues to be addressed this year. “In fact there are some whoppers,” he said.

First there will be the implementation of Digital Britain proposals, most of which 3 supports. Then like O2, the company also has concerns that the Orange/T-Mobile merger will result in a company with 60 MHz of 1800 MHz spectrum, which many see as a competitive advantage when it comes to rolling our future LTE networks.

Russell added that 3’s discussions about spectrum refarming have tended to focus on 1800 rather than 900-MHz spectrum. He said 3’s suggestion is that a block of the 1800 spectrum is released as part of the merger agreement.

Russell also highlighted other industry issues that should be addressed this year, such as mobile termination rates, mobile number portability and EU data roaming.

MTR will be reviewed and consulted on in March, he said. 3 is pushing for a rate of below 1 penny. MNP is expected to be discussed with Ofcom in the next six months, when the requirement to switch users will be cut from 48 to two hours. But Russell said the U.K. is the only market in Europe where users still have to ask permission to leave an operator. “To have to ask for permission is wrong,” he said.

As for EU data roaming, Russell said the cost of data when roaming abroad “is just wrong…it needs to be addressed today.”

For example, he said the average cost of 5 GB of data in the UK is £15 a month; if a UK user went to the EU he or she would pay £6,250 for the same amount.

Источник: Total Telecom

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