telco_telco 26/02/2014 18:17 Page 1
4G and LTE Broadcast: Welcome
to the mobile content revolution
Despite earlier misgivings over 4G
economics, Steve Gold now predicts
that mobile content will become as
profitable as broadcast TV in all its
shapes and forms.
here’s something
interesting going in
the world of 4G - the
cellcos appear to be
realising that, thanks to the
spectral efficiency of 4G
standards, they can handle a
lot more 4G traffic in a given
base station’s area than they
could with 3G. Put simply,
this means that any cellco
that invests in the network
backhaul to handle high
data volumes from its base
station network can adopt a
price-aggressive stance
against its 4G competition.
And whilst it’s difficult to
extract real information from the
UK and European cellular
networks, evidence of this
pricing shift - which could have a
profound effect on the mobile
content that cellcos carry - is
starting to happen. In the UK, for
example, EE has been quietly
flooding the market with prepaid 4G SIM packages that are
valid for 6GB/3 months.
In early Q4 of 2013, the ‘going
rate’ for a pre-paid EE SIM pack
was around £20 (€23.5) on eBay,
Amazon and other specialist
outlets. This contrasted with a
£12 price tag for a Three SIM
pack - also with a three-month
validity but with only 3GB of
data included. Six months later,
towards the end of Q1-2014,
those same EE pre-paid SIM
T
28 EUROMEDIA
card packs are selling for around
25% less, whilst the Three SIM
packs have almost doubled in
price.
Initially I thought these SIM
card packs were the result of
dealer box breaking - where
resellers split the hardware from
the SIM card and sell the
hardware internationally something that the cellcos abhor,
as they effectively lose their
hardware subsidy, but chatting
to dealers reveals it is the
networks that are supplying the
SIM card packs in volume.
So what is going on here? As
I’ve mentioned before, EE was
first to market with its 4G
network in the UK in the latter
part of 2012, since when all the
other cellcos have followed suit.
EE has maintained its coverage
advantage, and invested heavily
in the network backhaul, whilst
Three is offering its 4G service
without any cost premium to its
customers. As a result, the
market price for a Three pre-paid
SIM pack is edging upwards,
whilst EE seems to be cutting its
prices to soak up more market
share.
Whilst these market
machinations will undoubtedly
be causing sleepless nights for
the accountants of the various
networks, these trends are
excellent news for the mobile
content delivery industry, as
sales of smartphone
apps on all major
Steve Gold platforms are going
From his base in
through the roof. The
Sheffield, England,
Steve has been a bottom line is that we
telecommunications are all consuming
journalist for 26 years, more mobile content
21 of them full-time.
on our smartphones
E-mail him at
[email protected] and portable devices -
and as never before.
I was fortunate enough to
catch up with Ericsson just prior
to Mobile World Congress in
Barcelona to talk about LTE-B short for LTE Broadcast. Unlike
standard LTE (Long Term
Evolution) - which forms the
mainstay of existing 4G network
usage - LTE-B takes a multicast
approach to 4G IP transmissions,
effectively adopting a satellite or
terrestrial TV broadcast model
for cellular topologies.
This allows optimum usage
of the available 4G radio
spectrum to deliver a wide
variety of multimedia content
simultaneously to multiple
devices, so generating much
more potential revenue for the
content providers, as well as the
networks that carry the signals.
Ericsson has high hopes for
LTE-driven mobile content worldwide, it expects to see
mobile subscriptions for hi