LTE's early benefits hindered by obstacles, according to Economist study

A new report from the Economist Intelligence Unit questions the benefits being heaped on the deployment of LTE in the UK. The study, published on the day EE launched the first UK LTE service in 11 cities, claims that the sky-high expectations surrounding the technology's early returns may have been overstated.

The EIU study argues that existing high-speed mobile networks are capable of delivering many of the anticipated new services over the next few years. However, it maintains that numerous obstacles remain to gaining real advantage from utilising even the existing technology capabilities to good effect due to skill shortages and deep-rooted resistance to change.

"Over time, superfast broadband [LTE and fibre] will undoubtedly provide a platform for numerous positive changes in the life of the nation," Denis McCauley, director, global technology research at the EIU, and editor of the report, said in a statement. "A dose of reality is in order, however, about the scale of the impact in the shorter term. For many anticipated benefits, it is less about building bigger pipes and more about the need for established systems, processes and skills to evolve."

Conclusions from the EIU report, which was sponsored by Huawei, include:

  • The shift to superfast broadband will unquestionably deliver added growth and new jobs, but it is difficult to see how this impact will match that resulting from the earlier switch from dial-up to broadband Internet, at least in the near term.
  • A short-term, direct boost to jobs is expected, especially as the engineering work to build the networks gains pace. The longer-term, indirect impact on job growth is more difficult to project.
  • High-speed alone is not enough to effect a transformation in healthcare and education services. Many anticipated benefits in the provision of healthcare, for example, from telemedicine and remote diagnostics, are realistic but require wider reforms of the health system itself before they can be realised.

However, EE has countered this analysis by issuing what it said is the world's first global study into LTE business benefits.

The EE study, which is made up of a report from Arthur D. Little and quantitative research from EE involving 32 interviews with LTE-enabled business, claims that UK businesses expect LTE to help increase productivity by 58 per cent, and boost employee well-being and motivation by 38 per cent.

The EE report also said that nearly three-quarters of UK businesses intend to adopt LTE within 12 months—rising to nearly 80 percent of London-based firms, with CEOs and sales staff being the first in the business to use LTE.

Almost £1 billion has been provided in funds by the UK government to help accelerate superfast network development, which aims to boost national broadband speeds to more than 24 Mbps--nearly three times today's average--by 2015, according to the Financial Times.

For more:
- see this EIU release
- see this EE release
- see this Financial Times article (reg. req.)

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CCS Insight: Everything Everywhere bets on 1800 MHz LTE, but for how long?
Vodafone, O2 UK and 3 UK to speed up LTE launches following 'peace talks'
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