Year in review 2012: European LTE gains traction, at last


The news: Europe lost its crown of being a mobile technology leader by slipping behind many other countries with commercial LTE services. During 2012, the situation slowly began to turn as spectrum auctions took place and operators across Europe started to deploy LTE networks.

While Germany had already been leading the charge with LTE in Europe, France Telecom CEO Stephane Richard committed the company in March to deploying LTE across its European operations by 2015.

He did, however, use the occasion to snipe at Neelie Kroes, the European Union's digital agenda commissioner, and called for a more favourable environment for the deployment of networks.

Yet Germany was racing ahead, with its operators announcing LTE coverage had reach 13 million households during April. The country's operators, according to the German ICT trade group Bitkom, considered that rural LTE coverage was complete, and were now planning to deploy the technology across 300 German cities by the end of this year.

Regardless of this progress, Orange Spain CTO Eduardo Duato said that operators in southern Europe would be unable to afford the huge investments associated with LTE unless the current network business model fundamentally changed. Duato called for operators to move ahead rapidly and share active RAN and backhaul networks, which could see operators saving 25 per cent of the total cost of ownership (TCO) of the LTE network.

Meanwhile, Vodafone Germany's LTE network was coming under strain during the summer. Subscribers were starting to complain that their download speeds had fallen from around 20 Mbps last autumn to 5 Mbps in the early months of 2012. Some started now reporting speeds as low as 1 Mbps during peak evening hours.

By autumn, Richard was back again claiming that its deployment of LTE was critical, allowing operators to charge subscribers more for high-speed data services. "There will be a premium," he said. "The model with HSPA+ has made it clear that customers will pay.

EE in the UK adopted this approach with its early launch of LTE by charging subscribers a premium of 10 to 20 per cent above its 3G service. Meanwhile, after months of wrangling the UK began process of auctioning spectrum for LTE in December.

While France Telecom had already launched its LTE services focused on business users, SFR surprised many by unveiling its LTE service aimed at consumers. The service was launched in Lyon, Montpellier and Lille, with consumers in other cities having access during the first half of 2013.

Why it was significant: Europe risked falling behind in mobile broadband as companies encountered spectrum issues and pressure from investors to cut ballooning capital expenditures. Politicians began to question why the inventors of GSM technology had found themselves in this position, and lobbied the EU and their governments to loosen regulations to speed deployments.

Operators also began to understand the premiums they could charge for LTE download speeds, and recognised that being first-to-market could attract new much-needed subscribers.

2012 was a turning point for European LTE deployments, with Germany setting the pace. Other major countries have much ground to make up, and 2013 will see the battle for LTE customers turn nasty.