Why cellular network sharing makes sense

THERE'S CONSIDERABLE logic behind yesterday's confirmation that T-Mobile and 3 UK are going to share their 3G networks. Neither has a fixed broadband offering – so concentrating on mobile broadband makes sense.

Unlike the stalled Vodafone and Orange RAN (Radio Access Network) share, this couple has gone right ahead and formed a management company - Mobile Broadband Network Ltd.
There's loads of coverage figures being banded around but the combined network should reach the higher end of 90 per cent of the population.

The initial focus in 2008 will be on extending wide area coverage to rural areas, chiefly by moving 5,000 base stations from places where the two networks current overlap. Then the focus will shift to improving indoor coverage in dense urban areas in 2009.
The pair also claim this will create Europe's most extensive HSDPA network. So where the world's most extensive? In Japan, perhaps?

What has encouraged the pair to push on with building out their 3G networks. According to Martin Garner, mobile practice leader at Ovum, "The arrival of HSDPA over the last 18 months, together with flat rate data plans has broken the cycle. HSDPA at last provides a user experience close to users' expectations of broadband, and flat rate pricing gives users more confidence in their bill."

Consequently, USB 3G modems for 3G are selling like hotcakes. 3 totally ran out of its 3G modem only recently. Plus data traffic over 3G is rising very rapidly. At last.

Significantly the joint venture – which will last until 2031 makes provision for the networks to share LTE (the 4G version of W-CDMA), although neither partner is forced to start rolling LTE out. Ericsson must be rubbing its hands with glee since it already manages 3's network and has strong links with T-Mobile.

The agreement doesn't cover 2G. Which is not surprising really since 3's 2G traffic is handled by Orange now instead of O2. It might make sense for 3 to swap to T-Mobile, though.
Which is why there are persistent rumours that T-Mobile might end up swallowing 3 UK.

A big question mark hangs over what Telefonica/O2 is going to do since it becomes the only Brit operator not sharing its 3G network? Garner says that T-Mobile and 3 UK have hinted that they can see benefits if a third partner joins in and the door will be left open for discussions.

The biggest loser is Wimax. Who would attempt to build out a national Wimax network in the UK, when 3G coverage will soon be as good as 2G coverage? µ

See Also
More leaks on RAN sharing emerge
3 sells out of USB modems