Does LTE need a killer app? The clue is in the name….
LTE is truly upon us, with the recently launched Deloitte Telecoms Predictions forecasting that there will be over 200 million LTE subscribers by the end of this year. But will they using their devices in a discernibly different manner? Will LTE be the same stuff, faster, or will an LTE “killer app” differentiate it from current 3G offerings?
In the late 90s and early 2000s, there was much debate about what the killer app for 3G would be. 3G offered vast performance improvements over the existing capabilities, but in reality it was a technology solution looking for a problem to solve, despite £22.47bn having been spent by UK operators on licences. Many observers agreed that either pornography or gambling would be the killer app for 3G. That suitable handsets would be available to make content consumable was taken for granted, but arguably the killer app for 3G was the launch of the 3G iPhone in the summer of 2008, some eight years after the UK licence sales.
The iPhone’s form factor enabled users to comfortably consume data in large quantities in a truly mobile manner. After years of cutting prices to encourage data usage, the iPhone-induced data demand meant operators had to invest considerable sums to ensure their networks kept pace, despite prices being charged for data not necessarily reflecting this additional expenditure.
So what of LTE? Does it require a killer app to take off? Probably not.
Mobile data is now an everyday part of life. As a consequence, mobile operators are upgrading their networks to LTE a) because the cost of providing data over LTE is considerably cheaper than over 3G and b) to keep pace with rivals. Video streaming will be better over LTE – but it’s often acceptable over 3G. Cloud services will be better, as retrieving content from the cloud (such as music) will be faster – but again it’s currently something that mobile users already do over 3G.
Plus of course users have become accustomed to downloading larger volumes of data to their devices prior to venturing out or using wi-fi hotspots (particularly those not paying for eat all you can data bundles).
This is borne out in research undertaken in countries with more mature LTE deployments (such as Sweden and the US): LTE users are on average consuming more mobile data than 3G users – more video streaming, more web browsing, downloading larger files – but they are not doing anything different. Perhaps the biggest clue is in the name. LTE = Long Term Evolution. Evolution, not revolution.
George is a Director in Deloitte’s Enterprise Risk Services practice, specialising in the Telecommunications industry. George has a particular focus on information management and data analytics, and has worked with leading operators across EMEA to help them understand, manage and obtain value from their data on a wide range of transformational programmes.
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