Vodafone UK to launch 4G August 29

Operator group Vodafone has announced that it will launch 4G services in the UK later this month. The service will be live in London as of August 29, the same date that rival O2 plans to switch its LTE network on. Twelve further cities will be connected to the network by the end of the year, the operator added.

Vodafone’s services will be priced from £26 per month, and more pricing information is due to be released next week. It did reveal though that customers can benefit from unlimited data for three months; unlimited calls and texts and double the data available on standard Vodafone Red plans

Vodafone paid close to £800m for 85MHz worth of spectrum in total, in the UK 4G spectrum auction in February this year. The operator acquired 2x20MHz of 2.6GHz, 1x25MHz of 2.6GHz unpaired spectrum and 2x10MHz of 800MHz spectrum.

The group also signed a network sharing deal to create one single national grid with O2 and Emeka Obiodu, senior telecoms strategy analyst at Ovum, said that considering Vodafone UK spent £575 million in capex in the year ended March 31 2012, the deal could lead to savings of over £100 million a year for each operator.

Vodafone also stressed that it has signed deals with music streaming service Spotify and sport broadcaster Sky Soprts to offer 4G subscribers more than 20 million songs or over 150 hours of Premier League football built in to their package.

Guy Laurence, CEO, Vodafone UK said: “With 4G, speed is just the start: it’s what you do with it that really matters. We are taking 4G into a new league by offering sport; and changing the tune with all the music you could want. 4G is finally worth getting and there’s plenty to look forward to.”

According to Emeka Obiodu, principal telco strategy analyst at Ovum, what stands out from Vodafone’s announcement is what it has chosen to focus on: the tariff and content deals rather than speed and coverage.

“While the presumed emphasis on 4G has always been on coverage and network speeds, Vodafone has opted to focus on the content deals and tariff options behind its offer. In a way, this undersells Vodafone’s strength given its 800MHz spectrum holdings and the improved in-door coverage this band offers,” he said. “Instead, we sense that Vodafone wants to avoid the 3G lesson where it worked so hard to create the best 3G network, yet lost out as rivals, especially O2, delivered a better appealing proposition to customers.

Obiodu added that this time, Vodafone is focusing on getting the commercial proposition right.

“We expect the deals with Spotify and Sky Sports to appeal to a lot of customers, although the downside is that Vodafone might have been forced to rush out the announcement, when it has covered only few cities, so as to sync with the start of the Premier League.”

He added that Vodafone will be hoping to use 4G to prop up its ARPU in a similar way to the likes of Verizon Wireless; using business model changes such as shared data plans.

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