David Cameron summons telecoms bosses
Coalition pushes for concessions from all major mobile and fixed line telecoms companies to keep price inflation under control. Read more…
BT returns to mobile phone business with EE deal
More than 10 years after selling off O2 network, BT to offer 4G smartphone connections bundled with broadband, landline calls and pay TV in bid for edge over BSkyB. Read more…
Move from this summer will give Britain one of the fastest mobile internet services in the world, with speeds of up to 130Mbps
EE is to double the speed of its 4G network in 10 cities this summer, giving the UK one of the fastest mobile internet services in the world.
Smartphones will be able to transmit high definition video as fast as fibre-optic wires when EE turns up the dial, with the theoretical speed rising to 130Mbps, leading to a top rate of 80Mbps outside of the laboratory.
The move, made possible by doubling the amount of airwaves used to carry 4G, will put the UK well ahead of the US and on a level pegging with Japan.
“We are ensuring that the UK remains at the forefront of the digital revolution,” said the EE chief executive, Olaf Swantee. “Having already pioneered 4G here, we’re now advancing the country’s infrastructure again.”
The improved service will initially be available in 10 cities: Birmingham, Bristol, Cardiff, Edinburgh, Glasgow, Leeds, Liverpool, London, Manchester and Sheffield.
Existing 4G speeds already allow three-dimensional map images to appear instantly as the user scrolls around the cityscape, video calls with crisp pictures and no sound delay, and high definition video to be sent back to the studio by broadcasters, and the London air ambulance service to transmit vital data on patients back to the hospital before the helicopter lands.
Doubling the speeds would make all these activities faster, but developers have yet to come up with an application that would need all 80Mbps. “We don’t know what the next killer app is but our network is ready for it,” said Swantee.
The national obsession with smartphones and tablets appears to be firing demand for EE’s faster service, despite its premium price. Its parent company owns three networks: Orange and T-Mobile, which offer slower 3G speeds, and EE, which uses 4G.
A quarter of all customers joining the group are opting for 4G, the company said on Tuesday, and in the 50 towns and cities where the service is available, one third of all new customers are subscribing to the faster service.
The numbers suggest many more will upgrade when O2, Vodafone and Three switch on their 4G services in late spring, particularly if increased competition brings prices down.
Although existing EE customers will see their headline speeds double at no extra cost, the carrier will be hoping its faster network will allow it to continue charging a premium.
EE was able to launch 4G a full six months ahead of rivals by using spectrum it already owned rather than having to wait for February’s auction, and has now set a target of 1 million customers by Christmas.
The group declined to say how many have signed up so far, but 1m customers would represent 8% of its nearly 13m contract subscribers over a 14-month period. The most successful 4G operators around the world have been able to convert about 10% of their contract customers within two years, the company said.
“In the UK people use more internet compared to other markets, people have more smartphones than other markets, so the UK is the ideal market to have a benchmark network and that is the ambition,” said Swantee.
When France Telecom and Deutsche Telekom merged their Orange and T-Mobile networks in the UK in 2010, they created the country’s largest mobile group. With the 4G auction complete, EE’s owners are now looking to sell all or part of the company, either through a stockmarket listing or a sale to another owner.
Private equity firms including America’s KKR and Europe’s CVC Capital Partners are understood to be trying to raise debt financing for a £10bn buyout, while France Telecom has appointed Morgan Stanley to oversee the process.
“The reason there is so much noise about potential IPOs and private equity is because we have changed this company,” said Swantee. “This company is now leading the UK industry from a network perspective, and from a total size perspective.”
EE speeds will eventually double again, with tests before the end of this year for a service that could reach a theoretical peak of 300 Mbps. The trial will be to combine EE’s existing 1800MHz spectrum with the large amount of 2600MHz it bought at auction.
The group now owns 36% of all the mobile spectrum in use in Britain, more than any other single operator, and it predicts that by 2016, traffic on its own network will have grown 750%.
By this summer, mobile internet in the UK will be on a par with Japan, where 4G speeds currently reach about 75Mbps. Vodafone has announced it will bring fast 4G, with theoretical speeds of 150Mbps, to Australia this June.
The US networks claim theoretical speeds of more than 100Mbps, but deliver on average just under 10Mbps, according to a recent study by network testing firm OpenSignal.
Sweden topped the global chart with over 22Mbps, and EE’s average speed is likely to match that, making it twice as fast as the 12Mbps available on the average UK home broadband connection.
All EE will say is an ‘isolated technical error’ is to blame
I bought a mobile phone for emergency use only from Orange, now EE, in 2011 and retained my old phone number. In January this year a message claimed the sim card was invalid. A new one was fitted, but the same problem occurred. I was told the phone was faulty and bought a new handset. Within days messages warned the sim card was invalid and simultaneously showed my credit as being £62.50 and 40p. Again the problem was fixed and again it recurred. Then, when my wife called my phone, it was answered by a stranger who said the number had been allocated to her when she bought a phone in February. After numerous complaints we were promised that I would be given a new number and my credit would be restored but two weeks on we are still waiting, I’ve received a call for the stranger and my credit is now 1p. JS, Ashreigny, Devon
EE blames an “isolated technical error” which left you “without service”. Quite how this allocated your number and, presumably, your credit to someone else, as well as invalidating four sim cards, it can’t explain. Nor does it clarify why it took media intervention to rescue you but it’s decided to give you £250 for the inconvenience.
If you need help email Anna Tims at firstname.lastname@example.org or write to Your Problems, The Observer, Kings Place, 90 York Way, London N1 9GU. Include an address and phone number.
Anglian Water is chasing me for a debt that goes back six years
I’ve recently had two letters sent by a debt collection company on behalf of Anglian Water saying I owe £183 for a property that I have never lived in.
Anglian Water told me that my name was put on the property by my former landlady. She owns two properties. I have never lived in the property with the debt attached and I moved into the other property after the date the debt is for (April 2007) – so this can’t even be a case of muddling two addresses.
Anglian now expects me to produce a tenancy agreement for the property, as well a water bill for my parents’ house (where I lived before April 2007) so they can reverse the charges.
Please help. I doubt I have a tenancy agreement from six years ago, and I have lived in five different rental properties since.
In any case how on earth can Anglian hold me liable for a water bill for a house I’ve never lived in? EE, London
We’re still not clear how this muddle started. It does seem, as you say, that your landlady gave your name to Anglian as the person responsible for the bills at that time. Perhaps this was a mistake; either that, or she hoped you would pay the bill without noticing it wasn’t actually yours.
In any case, the good news is that Anglian has called off the hounds. It has apologised for wrongly pursuing you for the debt. It confirms that it was wrongly informed that you were the tenant of this property and has since had it confirmed that this was not the case – presumably by contacting the landlady who caused the problem.
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Vodafone and O2 aim to retain customers by offering savings on the cost of switching to new super-fast service in 2013
A marketing war has erupted among mobile phone operators ahead of EE’s launch of the UK’s first 4G network on 30 October 2012.
With EE the sole provider of the super-fast mobile phone service until 2013, and the only 4G network on which the iPhone 5 currently on sale in the UK is compatible with, competitors such as Vodafone and O2 have launched aggressive marketing campaigns in a bid to retain customers.
Vodafone has launched a £4.5m national newspaper campaign that boldly states “not all 4G networks are the same”. The advert, a clear attempt to persuade customers to stay with it rather than switch to EE, claims that Vodafone’s signal will travel “further into your home”. It also says it will be the only mobile network to “own a nationwide fibre backbone”.
Customers at Vodafone are being told that if they purchase certain handsets on a 3G plan now, they will only have to pay 30% of their remaining contract if they want to switch to a new phone and tariff when the operator launches its 4G network some time in spring 2013. The offer applies to Samsung Galaxy SIII, iPhone 5 and Samsung Galaxy Note II devices, and is valid until the end of 2013.
This means someone buying an iPhone 5 phone on Vodafone’s £33 a month, two-year tariff, would have to pay Vodafone £188.10 to switch to a 4G plan if Vodafone were to launch its new network on 1 April 2013, five months into that customer’s two-year deal.
This is £439.90 less than it would ordinarily cost to pay up the contract, although many customers might wonder why, if they are signing a new two-year deal with the same company, they cannot do so for free.
A spokesman for Vodafone said the company was unable to have any kind of transitional contract in place “because we don’t actually own the spectrum and you cannot advertise something you don’t have”.
He said the price promise was designed to reassure customers who had recently or were about to sign up for a new contract, and that he did not expect to see customers rush to EE to avoid charges later on.
O2 has a similar deal to Vodafone. Its 4G price promise means customers who buy an iPhone 5 between 21 September 2012 and 31 March 2013 can upgrade during their contract term to a new 4G phone and O2 will pay 10% of the cost of buying out their contract, as well as the VAT.
This means someone on a £36 a month contract with seven months left can switch to the 4G-ready iPhone 5 and only pay £181.44, instead of the full £252 that is due. Customers can also trade in their phone through O2′s Recycle scheme and put the proceeds towards the cost of a new iPhone 5 (an iPhone 4S 16GB model currently gets up to £260).
But again, O2 customers might question why their provider will not simply allow them to sign up to a potentially more expensive two-year tariff for free.
At Orange and T-Mobile, where customers will benefit from EE’s early licence, new customers who purchased a 4G-ready handset can upgrade to EE’s new 4G service at no cost. Customers who joined Orange or T-Mobile in the past six months may (if they bought a Samsung Galaxy S3, iPhone 4S or HTC One X) be eligible to swap to 4G EE for a flat fee of £99.
Ernest Doku of price comparison website uSwitch said the price of switching on Vodafone or O2 would be “hefty”, and was likely to put off a lot of consumers, but that operators needed to recoup the cost of their customers’ existing handsets.
“It will be the early adopters who will switch networks, but the barrier for entry is going to be the cost of data,” he said. “A lot of those people are heavy smartphone users and they will use up the free data on EE’s entry tariff very quickly.”
He added: “Unfortunately consumers aren’t embedded with a crystal ball see how 4G pans out on their network.”
Guy Laurence says Vodafone, which paid no coporation tax last year, is one of the UK’s biggest contributors to the exchequer
Vodafone’s UK chief executive has launched a robust defence of the company’s controversial record on tax , saying the mobile provider is one of the country’s biggest contributors to the exchequer.
Speaking from Vodafone’s network control centre in Newbury, where the firm is preparing for the launch of a 4G mobile internet service next year, Guy Laurence called for an end to network “bashing” by British regulators.
“Can you name any other industry that has contributed as much to the HMRC as mobile phone companies pay when they pay for spectrum?” he asked.
Vodafone, whose corporation tax bill in the UK was zero last year, has been targeted by campaigners over its contribution to the exchequer. But the company stresses that it has handed over £6bn in spectrum payments to the Treasury since the 3G auction in 2000.
The shadow chancellor, Ed Balls, told the Labour party conference the estimated £4bn raised from next January’s airwaves auction could be used to pay for new homes.
“Is there another industry that is going to contribute as much to the Treasury as the mobile networks will in the 4G auction?” asked Laurence. “Ed Balls says the money we spend could pay for 100,000 homes. Who else could finance that?”
As Laurence became animated over questions on tax and the many legal threats that preceded a recent agreement to go ahead with the 4G sale, the army of identically dressed engineers sitting at computer terminals around him, Vodafone’s self styled “men in black”, remained calm and quiet.
Their job is to manage the flow of traffic across the network, planning for national events such as the Olympics and traffic spikes generated by demonstrations, road accidents and floods. Vodafone’s technological nerve centre is designed to be self-contained. With its own kitchens and power supply, in the event of an emergency the building can be shut off from the rest of the campus. The work done here is arguably the most critical of any UK network.
Vodafone connects the mobile phones used by 80% of ambulance trusts, 75% of fire brigades and police forces, four in 10 UK businesses, government departments and, rumour has it, the prime minister himself.
Which is why Laurence is content to take his time over launching Vodafone’s 4G service. “We believe 4G done well is better than 4G done quickly,” he said. EE, the first 4G network, goes live next week, in a thinly veiled reference to EE. The first out of the gates when its service goes live next Tuesday in 10 UK cities, EE is promising speeds five times faster than 3G.
The company was able to launch early because it owns the most spectrum. The other UK networks must wait until after the auction to acquire the airspace they need to compete, meaning they face a six-month delay.
According to a timetable set out by the regulator, Ofcom, the earliest auctioned spectrum can be released is April or May, because it is currently being used to broadcast digital TV channels. Laurence says he expects Vodafone’s 4G to go live in “late spring or early summer”.
This gives time to integrate the firm’s new purchase, business telecoms firm Cabe & Wireless Worldwide. Thanks to CWW, Vodafone now owns the UK’s largest fibre-optic network, which amounts to more than 12,500 miles of wiring.
A third of Vodafone’s base stations pass within 100m of CWW fibre, and work has now begun to plug them in. The better Vodafone’s wiring, the more internet traffic it can carry.
“I can control the quality of service,” Laurence said. “We own our own network, we have other customers on it, but we have the Olympic lane and our 4G customers all go down that Olympic lane.”
He said that Vodafone’s signal would give better indoor coverage than EE’s, because the British group owns more low frequency spectrum. As anyone who has tried to sleep through a neighbour’s party knows, base frequencies travel through walls much better than higher frequency sounds.
“We believe that the indoor connection is critical to 4G because two-thirds of activity in mobile is indoors,” Laurence said. “Not all 4Gs are equal.”
Orange and T-Mobile customers will pay between £36 and £56 for a two-year contract, depending on data usage
Orange and T-Mobile customers wishing to use the new ultra-fast 4G mobile phone service will have to fork out as much as £56 a month for the privilege.
4G, to be launched in the UK on 30 October by Orange and T-Mobile’s parent company EE, delivers speeds up to five times faster than 3G. Consumers will be able to download and stream music and videos easily while on the go, with a standard definition movie taking just 10-15 minutes to download.
EE has now published its price plans for the 4G service, revealing that two-year contracts range from £36 to £56 a month depending on how much data you use. Unlimited calls, texts and a 500MB data allowance will cost £36, rising to £41 for 1GB, £46 for 3GB, £51 for 5GB and £56 for 8GB.
The cost is around £5 a month more than Orange and T-Mobile’s current 3G tariffs.
EE also unveiled Sim-only pricing for those who already have a 4G phone, with plans with 500MB a month of data costing £21, 1GB costing £26, 3GB for £31, and 5GB costing £36.
Olaf Swantee, chief executive of EE, said the pricing was competitive. “We will deliver consumers and businesses across the country next-generation services and a superior level of support. Our new plans have been developed to offer our customers everything they have been asking for – superfast performance, choice and value.”
Consumer groups agreed that the pricing was attractive but said the 500MB cap would be quickly used up by anyone streaming movies and music.
Dominic Baliszewski, telecoms expert at BroadbandChoices, said: “The starting download limit is 500MB with the cheapest package – enough to get you through light emailing and surfing but this will never be a replacement for the much more generous download limits that come with landline broadband packages that allow you to stream and download without worrying about data usage – so don’t ditch the line rental just yet.”
He added: “Given the much faster speeds 4G can deliver, early adopters of this service will likely want to make the most of its capabilities and may be forced to opt for the pricier packages such as the 8GB data package at £56 per month.”
Ernest Doku, telecoms expert at uSwitch.com, said add-ons like Orange’s two-for-one cinema tickets deal could also prove attractive to smartphone users.
Regulator Ofcom will be holding an auction in January 2013 at which mobile phone operators can bid for a 4G licence, but it surprised the industry earlier this year by giving EE the go-ahead to exclusively launch 4G in the UK from September 2012.
4G-ready phones (including the iPhone 5, the HTC One XL and the Samsung Galaxy S III) are already on the market, and EE said its customers in the first six months of their contracts could upgrade their iPhone 4S, Samsung GSIII, HTC OneX handsets to a 4G handset for a one off fee of £99.
EE is launching 4G coverage in 10 UK cities: Birmingham, Bristol, Cardiff, Edinburgh, Glasgow, Leeds, Liverpool, London, Manchester and Sheffield.
But Baliszewski warned that consumers who rush into a deal could pay more in the long run. “EE has an excellent track record for service but more providers competing for your custom means cheaper prices and better terms for you, so it could be worth waiting a little longer before signing up,” he said
A network that allows mobile access to the internet as fast as a desktop PC’s will be live in weeks – if a little underused
Mobile phones used to be just for calling your friends, but with a super-fast mobile network set to launch in the UK, opening web pages in a split second and watching TV in high definition will soon be a reality for smartphone-addicted Britons.
It has taken years of legal wrangling, lobbying, interventions from two secretaries of state and head-scratching by regulators but, by the end of this month, Britain will have a 4G network. The country’s largest operator, EE, will launch the service in 10 British cities on 30 October in a bid to grab an even bigger slice of the market than the 34% it already controls through its Orange and T-Mobile brands.
Every decade or so brings a new generation of mobile phone technology: 1G brought us the brick-like analogue phones that so date films made in the 1980s; 2G saw digital phones shrink almost to the size of business cards; 3G made phones “smart” and able to use data. So what is the “fourth generation” technology, and will EE’s head start give it an unassailable advantage over competitors, who will have to wait until after this year’s spectrum auction?
In essence, 4G is a way of squeezing larger amounts of data over radio waves. Essentially it turns your phone into a device with links to the internet as good as a desktop computer’s – in theory making watching BBC iPlayer, video calling or multi-player gaming just as seamless on the move as it is at home.
Standards body the International Telecommunications Union (ITU) originally defined 4G as technologies that deliver speeds of one gigabit per second to stationary users, but today’s version falls well short of that.
The top laboratory-tested speed on EE’s 4G network is around 50 megabits per second (Mbps) – equal to superfast home broadband. In practice, the company is promising speeds of up to 12Mbps, which is not that different from the latest version of 3G.
“Technology-wise, 4G is an evolution,” says James Barford, telecoms expert at Enders Analysis. “The latest version of 3G is quite close in performance to the current 4G. That said, EE’s network will be virtually empty for at least six months, so the speeds experienced are likely to be impressive.”
Actual speeds depend on many factors. Data moves more slowly in the wild than in a lab because information is carried in such large packages, that if there is any interference, the signal degrades fast. Other factors include the proximity of a mast, the speed of the phone’s processor (the state-of-the-art chip inside Apple’s new iPhone 5 makes a big difference), and the amount of other users drawing down information from the same cell on the network.
Networks vary in quality according to how many masts they have in a particular area. Owning lots of spectrum helps, too: spectrum is divided into bands, some of which are reserved for the military, or commercial broadcasters, but a growing number are reserved for mobile telecoms. The more bands of spectrum a network owns, the more room it has to carry data.
Cabling is also important. Mobile web traffic is typically carried over the air only as far as the mast. After that it travels through wires, which ultimately connect to the internet: some networks rely on cables that carry only a handful of megabits per second. Three and EE have installed higher-capacity cabling, and Vodafone’s recent purchase of Cable & Wireless Worldwide will allow its masts to plug into one of the UK’s largest fibre-optic networks.
Many consumers will wait until 4G is available on multiple networks and over a wide area before taking the plunge, says Ernest Doku at price comparison site uSwitch. “The early adopters, who have to have the latest and greatest technology, will switch to EE because it has the service first, but a lot of consumers could be prepared to sit on their hands.”
Peace deal between mobile companies heralds nationwide 4G coverage on multiple networks six months early
The UK will have nationwide 4G services running on multiple networks by the end of next summer – six months earlier than originally proposed – under a deal sealed in a meeting between the networks and culture secretary Maria Miller on Tuesday night.
The agreement will shorten the headstart won by EE, the largest network company and parent of Orange and T-Mobile, which intends to launch the country’s first 4G service later this month.
So-called “fourth generation” mobile technology allows much faster internet connections for phones than today’s 3G networks. With the iPhone 5 and high-end smartphones from Nokia and Samsung designed for some British 4G spectrum bands, operators are now racing to build the networks capable of running them at full speed – which will allow users to download movies in seconds and make high quality video calls.
EE already owns enough spare spectrum to be able to launch this year, while its rivals O2, Vodafone and Three must wait for a government airwaves auction to acquire enough bandwidth for 4G.
In an 11-page letter sent to Miller on Monday night, telecoms regulator Ofcom offered to bring forward both the auction date and the deadline for clearing the spectrum being sold from digital TV signals so they are free to carry mobile phone traffic.
The heads of the UK networks agreed a peace treaty on Tuesday night after months of legal wrangling.
“Delivering 4G quickly is a key part of our economic growth strategy,” said Miller. ” I am grateful to the mobile operators for their co-operation in bringing forward vital 4G services. The open and collaborative approach taken between the government and the mobile companies will have hugely beneficial results for UK business and investment. We anticipate that 4G services will boost the UK’s economy by around £2-3bn.”
O2′s UK chief executive, Ronan Dunne, said that after intensive lobbyingthe auction would begin in January instead of February or March. It is expected to bring in up to £4bn for the government’s coffers.
Dunne added that masts company Arqiva would be able to clear away digital TV signals in England, Wales and most areas of Scotland by May, with networks able to launch services by the end of the summer after around two months of testing. However, the harder to reach Highlands and Islands will have to wait longer for 4G, with services not expected until later in 2013.
The UK’s 4G auction has suffered from repeated delays after a combination of legal threats from phone companies and a mix-up over digital TV signals. UK digital channels launched on a different band to the rest of Europe and Arqiva is now rushing to harmonise them in line with the continent.
Dozens of other nations including Germany, the US and even smaller economies like Estonia already have 4G, putting the UK in danger of losing its reputation as a pioneer in mobile technology.
In a presentation which laid part of the blame for the slow progress at Ofcom’s door, Dunne said: “Everyone is pleased that we’ve made this progress, it’s just a little bit frustrating that it’s taken so long. Before our various interventions we didn’t have a genuine level playing field and we risked a 4G digital divide.”
But the regulator denied that it was to blame.
Ofcom’s chief executive, Ed Richards, said: “The actions we have taken with industry and government avoids the risk of significant delay and is tremendous news for consumers who might otherwise have waited a considerable period for the next generation of mobile broadband services. Ofcom’s objective has always been to release the spectrum as early as possible and we remain focused on starting the auction by the end of the year.”
All operators have now agreed not to litigate either EE or the 4G auction. It is understood that the EE chief executive, Olaf Swantee, has promised not to hold up the work of Mitco, a jointly owned company charged with clearing the spectrum for mobile use over the coming months.
Shadow chancellor Ed Balls has said he will spend the proceeds on building affordable homes and a stamp duty holiday if Labour is elected.
Responding to Balls’s plans, announced at his keynote Labour party conference speech on Monday, Dunne said: “It would have been nice to have had an auction before somebody actually went and spent the proceeds.”