EE launches in 10 UK cities – does 4G mean the end for all-you-can-eat data plans?

30 Oct 2012

The launch of EE (Everything Everywhere) with LTE (4G) available in 10 cities ahead of other operators in the new year is revealing – it signals a desire among telcos to move away from the all-you-can-eat data plans that commoditised data faster than the industry expected.

EE, a tie-up between Orange and T-Mobile in the UK, today made its service available for potentially 11m homes in 10 cities with data speeds of up to 76Mbps available.

Rolling out at a pace that should make the ComReg boffins and planners at mobile operators in Ireland take note, EE’s 4G network rollout will increase to 3,218 sq kilometres every month.

In its first phase, the 4G service is going live in Bristol, Birmingham, Cardiff, Edinburgh, Glasgow, Leeds, Liverpool, London, Manchester, Sheffield and Southampton.

UK regulator Ofcom revealed that the spectrum auctions for the main operators in the UK will take place just after Christmas, with 4G services expected to be available in the UK nationwide before the end of the first half of 2013.

“We’re investing stg£1.5bn in our network to be the first company to offer mobile 4G in the UK, alongside the biggest 3G network,” EE’s CEO Olaf Swantee explained.

“Combined with our fibre broadband and revolutionary service model we have a pioneering and unique offer to customers across the UK – superfast speeds in the home, superfast speeds on the move and expert service on nearly every high street in Britain,” he said.

Telcos’ indigestion from the all-you-can-eat buffet

The new price plans from EE – while 10 to 20pc higher than 3G – have attracted considerable criticism not so much for the price for the 4G tariffs but rather on the amount of data bundled at each level.

Ovum regulation analyst Matthew Howett surmised that ultimately the telecoms industry wants to get away from all-you-can-eat data plans which they feel caused mobile data to become commoditised more quickly than the industry expected.

“EE was always going to have a difficult role to play being the first mover,” Howett explained.

“However, its peers may be grateful for attempting to move away from an all-you-can-eat world for data to an attempt to monetise it. Too quickly data became commoditised for operators once smartphones and other connected devices proliferated.

“We have said previously that consumers will likely only see the true benefits of 4G when there is more than one player in the market, and that looks set to become a reality in mid-2013, when additional mobile spectrum is awarded for 4G.

“While consumers might grumble about all the other operators coming late to this party, we should remember that it was because Ofcom was trying to guarantee a competitive, four-player market post auction that we have seen so many delays,” said Howett.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years