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Profile: America will lead 4G adoption, but not overnight, says analyst Keith Mallinson
21 May 2010 | 10.41 Europe/London
There is good cause to be optimistic about LTE, or 4G mobile broadband services, but global sales of 4G dongles and connected devices will not surpass 3G until 2019.
That is the conclusion of Keith Mallinson, founder of WiseHarbor who has researched predicted uptake of Long Term Evolution (LTE) devices which hold the potential to significantly increase mobile broadband speeds above current 3G rates.
Based between Boston and London, Mallinson believes his latest research is the first to go up to 2020 and so enables him to pinpoint the tipping point between 3G and 4G. Whereas America is currently accounting for around a third of the global sales, this proportion will go down to around a quarter of the market by 2012/13 as other countries, potentially China, start to take up 4G more aggressively.
Europe, he believes, does not seem to be a in a major hurry to roll out 4G (outside of Scandinavia) and so could soon be surpassed by China as the tipping point of 2019 looms.
“Some people may think LTE reaching parity and then starting to overtake 3G in 2019 is a little late, but it’s typical of most technology,” he says.
“Investment in LTE will need to be huge and so it’s not going to happen overnight. 3G took years before it started to gain momentum beyond early adopters. The devices needed to get better at maintaining battery life and look less clunky before people wanted them.
“We now have a lot of demand for mobile broadband, which 3G didn’t have when it first launched, but it’s still going to take many years until the telecommunications companies around the world are going to have rolled out the infrastructure to add LTE.”
LTE and Obama's broadband plans
One of the crucial aspects for the American roll out of LTE is President Obama’s National Broadband Plan which aims to give every citizen broadband by 2020. Similar to the last UK government’s pledge to give all British households a 2Mbp/s connection by 2012, the American plan is going to have to rely, in part, on mobile, Mallinson believes.
“America is huge and there are parts where people are so far from an exchange that there’s just no way they’re ever going to get a DSL connection,” he says.
“There’s lots of work going in to fibre, but of course, it tends to be the built up metropolitan areas. For me, I think the telcos have got it right and the only way you can give everyone broadband is going to be through LTE, it’s going to be instrumental in bridging the digital divide.”
Roll out of 4G, or LTE, services will vary from country to country, although there already seems to be a pattern emerging of building capacity with high frequencies in urban areas and extending reach to rural areas through low frequencies. The latter are typically in the 800-900MHz range which are being freed up by the switch to digital television.
Hence, another reason for a slower roll out of 4G is going to be liberalising and redistributing the necessary spectrum. This is less of an issue in America than it is in the UK where Vodafone and O2 monopolise the existing 900MHz spectrum (used for GSM voice services), which is proving a sticking point on further liberalisation of the similar 800MHz airwaves released by the digital switchover.
This is another reason why America is likely take an early lead in LTE roll out, a lead that will be pulled back as Scandinavia continues to innovate and then China enters the market.
“China’s going to be huge for 4G,” says Mallinson. “They had to use their own national flavour of 3G which China Mobile is not so happy about and so they want to move on to 4G as soon as possible. If and when that is approved, it will be a huge opportunity for LTE.”
That is the conclusion of Keith Mallinson, founder of WiseHarbor who has researched predicted uptake of Long Term Evolution (LTE) devices which hold the potential to significantly increase mobile broadband speeds above current 3G rates.
Based between Boston and London, Mallinson believes his latest research is the first to go up to 2020 and so enables him to pinpoint the tipping point between 3G and 4G. Whereas America is currently accounting for around a third of the global sales, this proportion will go down to around a quarter of the market by 2012/13 as other countries, potentially China, start to take up 4G more aggressively.
Europe, he believes, does not seem to be a in a major hurry to roll out 4G (outside of Scandinavia) and so could soon be surpassed by China as the tipping point of 2019 looms.
“Some people may think LTE reaching parity and then starting to overtake 3G in 2019 is a little late, but it’s typical of most technology,” he says.
“Investment in LTE will need to be huge and so it’s not going to happen overnight. 3G took years before it started to gain momentum beyond early adopters. The devices needed to get better at maintaining battery life and look less clunky before people wanted them.
“We now have a lot of demand for mobile broadband, which 3G didn’t have when it first launched, but it’s still going to take many years until the telecommunications companies around the world are going to have rolled out the infrastructure to add LTE.”
LTE and Obama's broadband plans
One of the crucial aspects for the American roll out of LTE is President Obama’s National Broadband Plan which aims to give every citizen broadband by 2020. Similar to the last UK government’s pledge to give all British households a 2Mbp/s connection by 2012, the American plan is going to have to rely, in part, on mobile, Mallinson believes.
“America is huge and there are parts where people are so far from an exchange that there’s just no way they’re ever going to get a DSL connection,” he says.
“There’s lots of work going in to fibre, but of course, it tends to be the built up metropolitan areas. For me, I think the telcos have got it right and the only way you can give everyone broadband is going to be through LTE, it’s going to be instrumental in bridging the digital divide.”
Roll out of 4G, or LTE, services will vary from country to country, although there already seems to be a pattern emerging of building capacity with high frequencies in urban areas and extending reach to rural areas through low frequencies. The latter are typically in the 800-900MHz range which are being freed up by the switch to digital television.
Hence, another reason for a slower roll out of 4G is going to be liberalising and redistributing the necessary spectrum. This is less of an issue in America than it is in the UK where Vodafone and O2 monopolise the existing 900MHz spectrum (used for GSM voice services), which is proving a sticking point on further liberalisation of the similar 800MHz airwaves released by the digital switchover.
This is another reason why America is likely take an early lead in LTE roll out, a lead that will be pulled back as Scandinavia continues to innovate and then China enters the market.
“China’s going to be huge for 4G,” says Mallinson. “They had to use their own national flavour of 3G which China Mobile is not so happy about and so they want to move on to 4G as soon as possible. If and when that is approved, it will be a huge opportunity for LTE.”