Cutting Room: Much ado about nothing?


Geographic clutter? This spat between 3 and Orange about network coverage seems petty. Each network operator has its own way to measure network and signal strength, ways that invariably enable each to claim superiority.

Except for O2, of course, which never appears to claim it has the best 3G network. And tells its own story – certainly, you ask rival firms how O2 has managed to consistently buck a market trend and an entire economic slide to post consistent growth over the past six quarters, and they laugh glibly and suggest it has invested comparatively little in its infrastructure.

Orange meantime reckons its network coverage is best by area, 3/T-Mobile claims theirs is best by population and Vodafone claims its is best by depth – deep crust, not thin and crispy, you see.

Ironically, 3 and Orange and T-Mobile will all be running off (parts of, at least) the same network shortly, anyway, as the former carries its network sharing arrangement into the merger of the latter pair.

What it tells for sure is infrastructure is a differentiator again, like it was when operators were still happy as money-spinning telcos and growth was easy, and weren’t paranoid of being utility pipes in the minds of consumers.

Whether it is a decisive argument yet for consumers in their decision-making is unclear. Because O2 has been able to disguise its shortcomings in network terms with marketing grease. Which is O2’s brilliance these past few years.

But consumers will start to choose airtime providers for the reliability of their networks. That time is coming. Guillaume van Gaver says so at the end of the interview in Mobile News issue 459, in response to a question raised because of Mobile World Congress keynotes last month.

These “dumb pipes” are going to be required to carry video across their networks. Loads of it. As Ronan Dunne almost said in interview in the issue, if the space and time had allowed in print, 70-80 per cent of regular internet traffic is video.

“It is like the road network; like the M25 and M6 toll road. The M25 has a variable speed limit to increase throughput. But we have also to think in terms of an M6 toll road, to provide dedicated bandwidth and a dedicated quality of service,” explained Dunne to us.

Those quality of service guarantees will play a role, and unlimited data will be a thing of the past. Operators will make money from digital logistics, so companies pay for safe distribution of digital content across their airwaves, much like AT&T works with Amazon on delivery of Kindle content in the US. Networks will take revenue off haulage companies.

Change is happening before us. The talk of ‘killer apps’ that did the rounds all through the ‘noughties’ is not a conversation as it was. Because Apple has introduced a world of applications, literally, and the market has started to run with it.

The thing about O2’s cleverness in the past few years especially is it has under-invested in infrastructure when it has been able to get away with it, and concentrated on its broader product set; sometimes only packaging things neatly (Joined Up), sometimes being fairly innovative (O2 Money), sometimes doing smart marketing (Arena and Academies) and sometimes just paying lip service to future tech (NFC).

No other operator has done that. Think of its loyalty schemes; Priority, Top-Up Surprises, O2 More. Nothing from any of the others compares really. Orange Wednesday? Perhaps. But that feel-good factor runs through all its relationships with customers and partners. Even revenue share with dealers, even when they have been uptight about the whole concept, has been handled beautifully.

But infrastructure could tell against it. Speak with engineers, and they will tell you what antiquated steel structures it has put across the land.

Vodafone’s is considered about the best network in Europe, and the whole Orange/T-Mobile/3 network-a-trois is going to be a force. But that is a future battle. For now, O2 is posting continued growth, while others bitch about adverts.