Ericsson has extended its managed services deal with MBNL, the RAN sharing venture between the UK’s largest and smallest cellcos, EE and 3UK. The new five-year deal will include delivery of central operations and transmission, network performance and optimization, field services, and multivendor spare parts management services.
While MBNL runs the partners 3G network, EE is going it alone for LTE, although there is speculation that it may form an alliance with 3UK at a later date, especially as it has sold about 25% of its 1.8GHz spectrum to the smaller firm. EE launched LTE ahead of its rivals by refarming some of its 1.8GHz GSM frequencies, while Vodafone and O2 had to wait for the recent 2.6GHz and 800MHz spectrum auctions.
These two operators recently announced a network sharing deal of their own, but Mansoor Hanif, director of RAN development at EE, told reporters on Mobile World Live that this pact might be slowing progress on their LTE roll-outs. EE said last week that it had crossed the 500,000-subscriber mark for LTE, while it retains its temporary monopoly. O2 is expected to launch its own services this summer but Vodafone has suggested it will follow a few months later, perhaps to time its own event to coincide with a new iPhone launch.
But Hanif implied there might be other factors at work, saying rivals were complacent and lacking in EE’s ‘sense of mission’ about 4G, and telling the reporters that the Vodafone/O2 deal was ‘very strange’. He added: ‘I’ve been reading from press reports and our suppliers that they are not seeing eye-to-eye … They have split network responsibility in the UK, so O2 covers one half and Vodafone the other. That makes it very difficult for them to coordinate a nationwide service. We have not split up network responsibility on a geographical basis.’
While Vodafone insists the O2 alliance is going well, it did recently announce an increase of over 50% in its 2013 capex budget, which will now amount to almost £900m ($1.38bn). Much of this will go on the LTE deployment, which led Hanif to suggest Vodafone had underestimated the cost and complexity of creating a competitive 4G system (another major cost will be integration of the fixed line network assets which Vodafone acquired with Cable & Wireless Worldwide).
Vodafone, for its part, recently dismissed EE’s headstart by saying it would have ‘true LTE’ in 800MHz spectrum. EE hit back, pointing to the growing global ecosystem around its refarmed band ‘ which the GSMA predicts will be the most commonly deployed for LTE in future ‘ and its move to double its peak speeds in some areas. It is trialling 80Mbps download capabilities in 10 cities and will make these rates available commercially within a few weeks. It has currently reached 55% outdoor population coverage and is targeting 98% by the end of 2014 but has not announced indoor penetration goals yet ‘ Vodafone says it will hit 98% in-building coverage by the end of 2015, leveraging its low frequency spectrum. Like O2, it has 2x10MHz in this band, while EE has only 2x5MHz.