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3UK to offer LTE without price premium

The UK arm of Hutchison’s 3 has announced that it will not price LTE services at a premium to its existing offers. 3UK is currently bidding for spectrum in the UK LTE auction and said in a statement on Monday that the technology will be added to its network “later this year”.

But it will not be any more expensive than the firm’s current offering. “Unlike some other UK mobile operators, [LTE] will be available across all existing and new price plans without customers needing to pay a premium fee to ‘upgrade’,” the firm said.

Its comment about “other operators” was directed at Everything Everywhere, which stole a march on the rest of the UK mobile operator community by launching LTE in refarmed 1800MHz spectrum towards the end of 2012. EE has priced LTE higher than its 3G/HSPA services, although it cut its prices in January, leading some people to conclude that uptake had been disappointing.

EE is also well aware that its first-mover advantage is shortly to expire and is clearly trying to attract as many users onto long contracts as possible.

But EE’s price cuts and 3UK’s announcement on Monday reflect the fact that users are not widely inclined to up their spend for faster network access.

“If the price of a service is well above a consumer’s income or disposable spending levels then they are simply not going to buy it,” says Jaco Fourie, senior BSS expert at Ericsson. “If you have more than 100 per cent penetration in a market then you might get a bump from the early adopters when you first launch [a new technology] but when you get to the mass market you will grow at GDP—end of story.”

3UK CEO Dave Dyson said: “As we add the next wave of technology to our Ultrafast network, we’ve listened to our customers and thought long and hard about the right way to do it. We don’t want to limit Ultrafast services to a select few based on a premium price and we’ve decided our customers will get this service as standard.”

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2 comments

  1. Avatar Patrick Youngs 04/02/2013 @ 1:54 pm

    Surely the fact that 3UK have licensed most of their spectrum for LTE from EE will leave them little room to compete meaningfully with EE on price?

  2. Avatar John 23/03/2013 @ 7:41 pm

    The 1800mhz LTE spectrum that 3 bought is now owned by 3, not EE, so 3UK can do what they wish with it and price it as they want. The only real difference in the price of a 24 month contract between 3 or EE is that 3 will be offering LTE as standard on all price plans where as EE hit hard with a massive premium price. But that will soon change when 4G becomes the norm.

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