[Hands0n]

Unless you have been living in a cave for the past few years or just arrived on this planet it cannot have escaped you that there is a problem with the 3G networks in this country (the UK). They are barely able, and often unable, to support the current demand for mobile data. And with the increased availability of data-capable handsets such as Android and other OS the situation is not going to improve.

The BBC's Rory Cellan-Jones has been poking around the situation and written a short article on the BBC website that makes for some interesting reading. The full article is here --> http://www.bbc.co.uk/blogs/thereporters/rorycellanjones/2010/01/the_3g_traffic_jam_where_next.html


... the networks simply don't have enough capacity to deal with the flood of data that has suddenly arrived...

Quite possibly, but this is not the consumer's problem to deal with. As network provider it is, surely, up to the mobile network operators to scale their networks appropriately to the anticipated demand.


... mobile operators know very little about marketing or consumer behaviour...

Now that would not surprise me at all. Anyone recall Bob Fuller of 3 UK who, thankfully, is no longer employed by them? This is the gentleman who openly stated that their customers did not want Internet access and that 3's "walled garden" was more than sufficient. And then we have O2 who would rather spend their money on a large plastic tent on the Greenwich Peninsula than on their core business of providing a mobile network service. If they want to be a media or entertainment company perhaps they should release their mobile operators licence to a company that does want to be a mobile network operator.


... the operators have proved as inept at marketing femtocells as they were at selling 3G a decade ago ...

Why am I not surprised? The mobile operators have a unique mindset that is stuck in a time-warp. It is plainly apparent that they are in trouble and have not a clue of how to get out of it. They tinker and fiddle around the edges while ignoring the core and fundamental issues. They have had to be dragged kicking and screaming into the 21st century. Their cartel, the GSMA, does nothing to help, rather it hinders by looking at any critique with utter disdain. Not considering for a moment that the critique might just have a point.

It seems that, for now at least, the mobile network operators are stuck in a rut, permanently in the wake of the handset manufacturers. For the customers (thats us lot over here) there is only the prospect of worse to come.

[Ben]

It's a predicament to be sure. The mobile operators are going to run themselves as close to capacity as possible in order to operate at maximum efficiency, and I don't see any way out of that. Price pressure is keeping tariffs cheap, but there's no evidence that if tariffs were twice as expensive as they are now we'd see greater investment in infrastructure as a result.

I suppose one problem is that network buildout simply isn't a differentiator. Yes it requires massive investment, but if someone else goes and makes the same commitment then you've effectively paid a lot of money to tread water.

At this rate it'll probably take a new entrant with half an ounce of vision to roll out a real high speed next generation wireless network. Hell, without government intervention it'll take a new entrant to sort out the wired network, also! :(

[Hands0n]

Price pressure is keeping tariffs cheap, but there's no evidence that if tariffs were twice as expensive as they are now we'd see greater investment in infrastructure as a result.

Any additional income from increasing prices will be diverted directly to the shareholders dividend, such is the state of modern day economics. Most, if not all, listed companies are vehicles to generate shareholder cash only. There is no other incentive at all.

That, to me, is the biggest failing of our totally-capitalist view on life in the 21st century. We see it even in the public sector that is trying to emulate enterprise. Services are no longer the reason these organisations exist, only money. And in the quest to maximise that dividend investment in the golden goose is kept to the absolute minimum. It cannot last, and we've recently seen the initial shockwaves of a crash that is inevitable. We all thought the recent recession was bad, I forecast that we "ain't seen nothing yet" to quote a certain Mr Al Jolson.

I think you're right Ben, what is needed is an entrant with a strong entrepreneural spirit, a quest to be the best rather than the most financially successful. The second will naturally follow the first. But our incumbents are too led by the nose by the Finance Director who knows nothing about the business other than it must, at all costs, make ever increasing profits while making ever decreasing spends.

I think we all secretly had hopes that 3 would be that entrepreneur, and it very nearly was. But it has been plagued and crippled by what has now turned out to be its own history.

Next :)

[DBMandrake]

It's a predicament to be sure. The mobile operators are going to run themselves as close to capacity as possible in order to operate at maximum efficiency, and I don't see any way out of that. Price pressure is keeping tariffs cheap, but there's no evidence that if tariffs were twice as expensive as they are now we'd see greater investment in infrastructure as a result.

You could argue that they're not running "close to capacity" but many times over capacity. It's normal for all non-business grade (non-SLA-guaranteed bandwidth) internet connections to be sold "oversubscribed" that is, the amount of bandwidth someone like BT or Sky sells you on ADSL, multiplied by the number of customers they have is far, far in excess of how much bandwidth out onto the internet they actually have, by a factor of a large undisclosed integer number :D

Although about 5 years out of date now, when I worked in the ISP industry in NZ, I was horrified to find out behind the scenes that at that time, on an ADSL line with "up to" 8Mbit promised, Telecom NZ (the incumbent Telco, much like BT here) allocated a mere 22kbit of internet bandwidth per customer - yes, killobit, less than dialup speed. This was confidential information of course, and not made public except to wholesale ISP partners.

Because they could average this over their entire nationwide customer base, and there were no significant bottlenecks at an exchange level, surprisingly, it worked, and you could receive typical speeds of a few Mbit.

The 3G operators do exactly the same kind of over subscription - but with one key difference, not only do they have to aggregate customer bandwidth at the point where it goes from their core network out onto the internet, (and one could argue the likes of 3 have enough bandwidth to go around at that point in their network, as mostly idle cells can max out the speed the technology provides) but they also have to contend with over subscription and bandwidth sharing on a cell by cell basis, and this is where the analogy with the fixed line providers falls apart, and what is biting them in the behind.

They can't work by the same over subscription ratios as fixed line providers because they can't average over their entire customer base (millions of customers) - to provide a similar quality of service they can only average data over the number of customers they have on a given cell (since a cell is both a shared resource, and a bottleneck) - which could be in the order of a few hundred per cell, with maybe a dozen active at a time. When you have a lot less customers to average over, the over subscription ratio must be MUCH smaller, so 3G providers are permanently at a disadvantage here compared to fixed line providers.

When hardly anyone was using 3G data, they got away with their deception, but along came devices like the iPhone and the Nexus one, and people suddenly want to use data, enjoy using it, and the thin veneer of the 3G networks is revealed for what it is. The 3G networks of today are like the movie sets for westerns - all the shop fronts are façades, with nothing behind them...with workers out the back busily trying to build an actual building there before the approaching horde of customers reach the door.

To reach the advertised levels of performance with people actually using the networks requires a HUGE investment in infrastructure which NONE of the networks have sufficiently done.



I suppose one problem is that network buildout simply isn't a differentiator. Yes it requires massive investment, but if someone else goes and makes the same commitment then you've effectively paid a lot of money to tread water.

I would argue that while in the past network build out (of 3G) wasn't a differentiator, it is fast becoming one. Some networks like O2 still have their head in the sand and are trying to pretend the issue doesn't exist, but the demand for data has reached the point where their network is collapsing and even calls can't be made in many places at anything approaching peak times.

Serious investment in infrastructure is no longer a luxury, it is a necessity to even maintain the status quo with the growth in use, let alone improve performance. They bleat in public that they couldn't have anticipated the growth in data use that Smartphone devices such as the iPhone have caused, but the fault is all theirs for not investing.

What the networks have to realise is that their NETWORK is their core business asset. :rolleyes: If they don't have signal coverage where people need it, (including 3G) decent speed where people need it, and reliability (both data and calls) then people will wise up and WILL go elsewhere.

Under-spending on their own network infrastructure is shooting themselves in the foot long term, for short term gain. Those that choose short term gain to milk as much profit as they can right now (and they know who they are) are the ones that will fail in the long term when the industry has moved on and left them behind.

The end of the O2 iPhone exclusive has been an interesting time, as the phone that arguably uses the most data, and is most in the public eye, is now not only available on two other carriers, but can also now be unlocked - and there seems to be a public awareness forming around the fact that the quality and coverage of a network DOES matter.

For so long people put up with poor service and poor 3G coverage on iPhone's with O2 and didn't really know any better (and often just blamed the phone) but as soon as people started unlocking their iPhone's and using them on other networks, word has started getting around at just how poor O2's network is and just how much the network really does matter for a 3G data hungry device like an iPhone, or any of the new wave of devices like the new Nexus One. It has actually made it's way to the mainstream media, and I hear a number of word of mouth stories as well...("why does so and so get 3G on xyz but I don't on O2?")

With pricing plans between networks being much of a muchness (leapfrogging each other back and forth) I really do think that the quality, coverage, and performance of the network itself will come under scrutiny as a key differentiator over the next year or two, and I think some networks like 3 have actually realised that and are pouring money into improving their network now, rather than waiting until it's too late.

I think we're going to see big changes in the coverage and capacity of several of the networks over the next year or two.

[Hands0n]

I think we're going to see big changes in the coverage and capacity of several of the networks over the next year or two.

One has to hope that you are bang on there, but the pessimist in me kind of refuses to believe this given the networks' previous record, and the GSMA's complacency at the cartel level.

I think that Kevin Russell has an excellent opportunity to mop up with 3 - but they have a dreadful history with their customer services that puts a lot of people off. I will not use them until I read that Kevin has brought that operation back to the UK. The off-shore has been a disaster for them, no matter how good their network and tariffs. It all, inevitably, turns to tears when something goes wrong.

I cannot think of any of the four remaining networks who are prepared to pay funds into their network. They are, as you say, very busy milking it for all that it will give. It is all about share price and shareholder divvy and not very much at all to do with the actual business these days. Ask any Finance Director and see what they say. The business is a mere vehicle to pull in the GBP.

I do think that O2 is laying the foundations for a crash never mind what anyone says about the size of their customer base. If you'd told me that Lehman Bros would not exist 18 months ago I would have laughed in your face. All of these companies are, like DBMandrake says above, not a lot more than a facade, a gossamer thin impression of a mobile network operator. We see it several times a year, when a big occasion arises, the networks just collapse.

Moreso now we see it with the mobile data (I would never go as far as to call it broadband) where the underinvestment shows glaringly.

Consider this, O2 and others say that the modern day smartphone has caught them by surprise. What on earth did they think would happen with data-capable handsets being used on data tariffs? Remember folk, these are the industry, the very experts themselves. We are supposed to trust them to get things right. But the way they have behaved I don't think I would trust them to nip down the shops to get me a pint of milk, let alone design and deliver a coherent mobile network.

But we are stuck with them - there is no competition or alternative just yet.

I do hope that they're not trading on LTE that is still a few years away. That they messed up 3G inspires no confidence in me that they'll get LTE right!

[DBMandrake]

I agree a degree of pessimism is well deserved, but I think we're now at the inflexion point for mass adoption of 3G - six years ago or so when 3G started being rolled out, I don't think any of the networks had any idea how to sell it or what it would be good for, (video calls ? yeah, that really took off :rolleyes: ) 3G technology was essentially a solution looking for a problem.

Now it's clear what 3G was destined for - always connected internet devices like the iPhone and Nexus one, and although I hate to talk about the iPhone all the time, I really do think that was the handset that brought about mass market adoption of easy to use, 3G data hungry smartphone devices, and while it won't hold that position on it's own in the future, I think it does deserve credit for getting the ball rolling over the last couple of years.

Throw into that mix multi-network support for the iPhone (and other similar devices) and suddenly consumers can see and experience first hand the difference between a crappy GPRS network (or 3G that doesn't work, when you rarely do get it) and a state of the art pervasive 3G network. (assuming someone builds one :p although some networks certainly approach this much more closely than others at present)

For end users, 3G coverage and performance is no longer an ethereal and intangible concept, some hocus-pocus tick-box feature their network provider lists, but something that materially affects their daily lives by allowing them to check their email in 5 seconds instead of 2 minutes, allowing them to use google maps without waiting forever for map tiles to load, allows them to send a picture by email or MMS in a few seconds instead of several minutes, allows them to stream audio or video, (instead of not at all) check their facebook, and so on...

All these services that people are starting to get used to on devices like the iPhone work very well on a good 3G network, but are painfully slow or completely unusable on a GPRS network. (Or a heavily loaded or broken 3G network for that matter)

I can imagine the tea room conversations going on around the country - "hey look at this (on my phone)" "hey that's great, why won't it work on my phone?" "because you're not getting 3G..."

I hear this kind of story from my girlfriend, whose iPhone along with mine is now on 3, and who has several work colleges with iPhone's all on O2, and they are constantly having signal problems at work - GPRS only coverage, and marginal enough that it drops calls or goes to no service at times, with GPRS data hardly ever working. One of them has only bought the iphone a month ago and is now stuck in a 24 month O2 contract with a phone she can barely use at work...meanwhile my girlfriends iphone on 3 is giving full 3G signal indoors and speeds of 2Mbit at times when the other phone can't even get a data connection at all.

People will start to feel ripped off (and rightly so) when they see friends and workmates with the same type of phone but on a different network who can constantly do things they can't on their own phone in the same location, and I believe the backlash has started already, evidenced by it repeatedly coming to the attention of mainstream media.

Give it another year or two, and I think anyone who is not using just a plain Calls and SMS clamshell phone will be demanding good 3G coverage from their provider, and leaving those that fail to deliver - it will become the next big service differentiator of the networks (ironically at a time when a lot of network consolidation is going on) and you can already see Orange and 3 beating their chests in the media about who has the most 3G coverage. (With O2 meanwhile remaining silent, apart from a vague promise to improve London, as if that's the only place their network is deficient, and Vodafone giving their bizarre "deep pan coverage" speech :D )

I agree that the customer service (or lack thereof) is the single biggest thing holding back 3, and I think that's a shame as I'm someone who likes to support the underdog and I see unrealised potential in them if they could only sort out the CS, and finish their coverage expansion.

When I moved here from NZ last summer with my iPhone I initially went with Virgin as I needed something to get started on quickly, but within a couple of months I was unhappy with network - poor 3G speeds, jpeg compression I couldn't turn off, intermittent poor call quality etc, and after trying a few Pay&Go SIM's from the different networks for a few weeks I bit the bullet and (somewhat apprehensively) ported my number to 3 despite being forewarned of their poor CS and having experienced it a couple of times already myself...

Maybe I'm just a glutton for punishment but the lure of a much better network and considerably cheaper prices for my usage habits (data heavy, call light) was too much, and for the most part I haven't regretted it. Yes I've had a few knock my head against the wall experiences with the CS, but I've also been surprised by good CS on occasion, so it's not all bad.

What has really caught my attention though is that their network seems to have improved in leaps and bounds in the last 6 months, at least in the Central Scotland area. When I first tried one of their SIM's in August I was quite disappointed - both at home, and in central Glasgow data speeds were atrocious, hovering around 128kbit, and quite flaky. Two months later I gave their SIM another try and I was stunned to see that I was getting 2Mbit+ around nearly all of central Glasgow, even in peak times, it was also a lot faster in most other areas, but unfortunately my house was in a dead spot that would only give about 128kbit - a few blocks from here it was over 1Mbit. Another couple of months later and I'm now getting 1.3Mbit at home as well.

So while they seem to be talking the talk on their blog saying they're upgrading their network, I can actually see evidence of this happening around me, and it will be interesting to see how things are by the end of the year when they claim they'll be finished the integration with T-Mobile's masts.

I really do think the market climate is such at the moment (with 3G coverage coming into the public focus) that they have the opportunity for a second chance if they seize the chance, but only if they sort out their CS once and for all and start building a positive public image, as you say it's not enough to try and have the best network if your CS is dreadful. The fact that they've started a blog and are talking publicly about their plans is promising though.

As for LTE, I don't think that will be a magic bullet either, at least not for coverage, if anything coverage would be worse with LTE - what's really needed is the opening up of the 850/900Mhz bands for 3G, as 2100Mhz just doesn't cut it for blanket coverage, and is deficient both in the country (where range is limited to about 5 miles per site) and deep indoors in a city. (where it won't penetrate walls)

The UK is well behind in this area, with even New Zealand being ahead - the two operators there, Vodafone NZ and Telecom NZ both now have 3G on 2100Mhz, but in addition to that, Vodafone NZ has 900Mhz 3G, and Telecom NZ has 850Mhz 3G. (In fact Telecom's entire network is 850Mhz 3G, with 2100Mhz only to provide extra capacity in densely populated areas)

Telecom's new network was only just completed as I was leaving last year so I didn't get a chance to try it but from what I've heard, both speeds and coverage - even out in the country, are outstanding, and they went straight to HSPA+ hardware nationwide, with no 2G fallback - but because they're running on 850Mhz they don't need 2G fallback. (Their legacy network is the incompatible CDMA/EVDO, so they don't have a legacy 2G GSM customer base to support, unlike Vodafone NZ, who still do 2G GSM on 900Mhz)

O2 and Vodafone are never going to give up their 900Mhz 2G spectrum for 3G use by other networks, so hopefully the 850Mhz spectrum can be freed up for 3G/LTE.

[Ben]

As for LTE, I don't think that will be a magic bullet either, at least not for coverage, if anything coverage would be worse with LTE - what's really needed is the opening up of the 850/900Mhz bands for 3G, as 2100Mhz just doesn't cut it for blanket coverage, and is deficient both in the country (where range is limited to about 5 miles per site) and deep indoors in a city. (where it won't penetrate walls)
This, I believe, is the problem. The operators wont spend more money rolling out 3G at 2100MHz when what they really want is to roll out LTE at ~900MHz.

We're stuck in a rut. The regulator needs to resolve the spectrum issues, now. Once that's done I think the networks will find it much easier to justify massive investment in infrastructure to their shareholders, quite possibly sparking a race for the 'new' 99.9% coverage.

[DBMandrake]

This, I believe, is the problem. The operators wont spend more money rolling out 3G at 2100MHz when what they really want is to roll out LTE at ~900MHz.

We're stuck in a rut. The regulator needs to resolve the spectrum issues, now. Once that's done I think the networks will find it much easier to justify massive investment in infrastructure to their shareholders, quite possibly sparking a race for the 'new' 99.9% coverage.

I agree completely - it seems that 3 and T-Mobile are the only one's doing any serious "rolling out" of additional 2100Mhz 3G coverage, but in reality they are only doing this by site consolidation between the two of them - I don't think they are building any significant number of new sites. Meanwhile all the other operators are sitting on their hands waiting for 900Mhz, as you say.

The most practical solution IMHO is that Ofcom give O2 and Vodafone a license to use their existing 900Mhz 2G spectrum for 3G as well (which they're not allowed to at the moment) and make 850Mhz available for T-Orangezilla and 3 to bid on for 3G. (In addition to their 2100Mhz licenses)

There isn't room to cram everyone into 900Mhz for 3G and provide a legacy 900Mhz 2G service for two operators as well, and I don't think existing Vodafone/O2 customers would be happy being bumped up into the 1800Mhz band, even if the other networks were to give up part of that.

Again there is some precedent in NZ - Vodafone NZ historically had 900Mhz for 2G GSM, then got a license for 2100Mhz 3G, and now they are licensed to use 3G on 900Mhz as well, alongside legacy 2G coverage.

Meanwhile Telecom NZ has been given access to the 850Mhz band for 3G which was not previously used for mobiles in NZ.

[Ben]

This is an interesting article. Lots of talk of resolutions in 08/09 and yet nothing materialised: http://www.eetasia.com/ART_8800480856_499488_NT_65c5c957.HTM

As far as I understand it there's too much legal wrangling going on at the moment for a resolution to be reached. Unfortunately T-Orange will have only muddied the water further, as rivals strongly resist the spectrumfest that will happen as a result.

It'll all get settled one day, but meanwhile, so long as everyone is in the same boat, I'd imagine all the players are happy to delay, delay, delay. I hope I'm being overly pessimistic.

This article suggests that 800MHz will be the saviour once analogue TV switch-off happens. That's not until 2012, unless I'm mistaken. We could be up to 2015 before we see any real improvement as end users. http://www.theregister.co.uk/2009/05/14/kip_meek_report/

[DBMandrake]

This article suggests that 800MHz will be the saviour once analogue TV switch-off happens. That's not until 2012, unless I'm mistaken. We could be up to 2015 before we see any real improvement as end users.

My worry with 800Mhz, is whether this is a non-standard 3G band ? It's not much use opening up a new band for use if no handsets support it, and currently in the low frequency range most US designed handsets support 850Mhz 3G, and most European ones support 900Mhz 3G.

If we bring yet another band in at 800Mhz that is only used in the UK or a very few places, what handset makers will support it ? Sure, you'll get custom versions of the cheap flip phones and feature phones, but you won't see support from the likes of Apple or HTC, and those are the devices you want 3G on. (Apple still doesn't support 900Mhz 3G which is widely used in Europe)

Just look what's happened in the US with T-Mobile, who use the non-standard 1700Mhz band for 3G, to my knowledge no other carrier in the world uses it, and they have to get custom versions of handsets made specifically for them, and those handsets wont work on 3G on other networks.

I'd really hate to see that happen here.

[Ben]

Yes, you're right, unless our UK regulator is aligned with Europe we do risk becoming isolated. I don't know what the EU makes of 800MHz at the moment. Fortunately, I think chips that support more and more bands will become pervasive, plus we're also a very desirable market.

I also don't know what the UK's current or projected use for 850MHz is... Google results are a bit spotty.

[hecatae]

sorry if this sounds silly, are Spectrum frequencies hard coded into chipsets or would existing hardware be able to use 900mhz 3g?

[DBMandrake]

Yes, the frequency range a 3G chipset can work on is part of the physical design of the chip - it can't be altered later with software. Then there are also the antenna(s) within the phone, which have to be designed to be the right size for the different frequencies.

As one example, the iPhone 3G supports 2G on 850/900/1800/1900 and 3G on 850/1900/2100.

If 900Mhz frequencies were allocated for 3G then a lot of phones and dongles would have to be replaced to make use of it, although some existing models may already support it, since 900Mhz 3G is used in some places in the EU.

The trend is towards chipsets that support a larger number of frequency bands, but they still tend to be bigger, more expensive, and use more power than more specific chips.

[hecatae]

As one example, the iPhone 3G supports 2G on 850/900/1800/1900 and 3G on 850/1900/2100.


and there's my point, is the band just disabled as the chipsets almost mirror each other on gsm and wcdma

[DBMandrake]

and there's my point, is the band just disabled as the chipsets almost mirror each other on gsm and wcdma
No, it's not "just" disabled in that case. The current iPhone 3G/3GS has 3 physically separate amplifier chips for 3G - thus it's limited to 3 bands. Adding a fourth would require an extra chip, or a new chip design that supports multiple frequency bands on the same chip - which are just becoming available now, so it might happen for the next release.