How LTE is Slowly Conquering Europe

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on August 1, 2011  

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Far behind the Asia-Pacific market leading countries (and the U.S.), the adoption of LTE technology by European countries is mainly hindered by the a lack of consensus on the optimal spectrum use.

In May, the European Parliament finally adopted the Radio Spectrum Policy Program (RSPP) allowing more open access to radio spectrum in Europe. Unlicensed spectrum and white space was made available for EU telecommunications networks.
Recent research by Informa has revealed that eight core frequencies are preferred by the main industry players with a stronger concentration around the following three: 700-800MHz, 1800-2100MHz and 2500-2600MHz.  Half of the 150 surveyed operators are targeting these bandwidths as their main choice of network deployment.

However, all main industry players do not yet agree on how best to manage and use the newly available frequencies for 4G LTE purposes.  Research suggests that using a band with diverse spectrum ranges (the three mentioned above) or any other mix of multiple frequencies should be avoided.
The problem resides in the fact that each bandwidth has benefits and drawbacks. The 800MHz band should be less expensive to implement and should provide good coverage, however, it is not optimal to achieve true 4G speed. The 2600MHz band, on the other hand, provides the opportunity for operators to acquire two 20MHz of contiguous spectrum which will allow them to operate 4G LTE services at optimum high speeds. But it will also require to build an adequate infrastructure, making it an extremely expensive solution. Finally, the 1800MHz band seems like a good compromise between coverage and capabilities but will require strenuous re-farming of the 2G and 3G networks, currently using these frequencies.

In the long term, a hybrid solution between the digital dividend (800MHz) and the 2.6GHz band should become standard for all operators. The 800MHz will provide wide-area and in-building coverage with a small amount of antennas and base stations while the 2.6GHz band will complete the spectrum needs with high levels of data transmission capacity for a high number of users in dense (urban) environments.

As of today, European countries’ situations about spectrum allocation are really diverse:

  • In Spain, all three big operators, Vodafone, Telefonica and Orange, secured LTE spectrum in both the 800MHz and 2.6GHz bands during an auction that took place last week and raised €1.65 billion. The 2.6GHz band is already available for 4G deployments, the 800MHz will be made available in 2014 after the switchover from analogue to digital broadcasting TV and re-farming of the 900MHz band has begun.
  • In Italy, 4G LTE is likely to hit the markets a little later as auctions of the ideal bands (800 & 2600MHz) should be made final only on September 30, for a total value comprised between €2.4 billion and €3.1 billion. The 900MHz band re-farming is already underway.
  • Germany was the first country to award 800MHz spectrum to its operators in April. It also allowed the use of the 2.6GHz band not only for mobile but also fixed wireless services, increasing competition over the spectrum but offering the german consumer greater choice and more competitive prices of broadband internet access, both 4G for mobile and fixed.
  • In France and Belgium, the auctions for 4G bandwidths will start later this year.
  • In the UK, the race for 4G has not yet begun.
While progress is made at great pace in Asia-Pacific countries, many European operators have a more cautious approach to 4G because they fear a repetition of the 3G introduction crisis. Over-investments in spectrum auctions had been made without having first developed an efficient and viable revenue model. As such, 4G LTE introduction is slower but it will eventually pick up and hit European markets with as much success as everywhere else.

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