iPhone and other devices will be a wake-up call for network performance
The introduction of the iPhone onto the Orange and Vodafone networks will challenge both operators to meet demanding customer expectations – meaning they face potentially costly upgrades or costly damage to their brand reputation, or both.
AT&T in the USA, O2 in the UK and T-Mobile in Germany all suffered at launch due to the demands iPhone users placed on the network – and the customer experience Apple’s glossy adverts led them to believe they would have.
Chris Lamour, CMO of network optimization and planning specialist, Actix, said that there “is no question that the introduction of the iPhone will have an impact on the networks.” In the USA AT&T is still the target of much criticism for the performance of the network, as is O2 in the UK.
If network issues are not dealt with in the UK, then the operators will face increasing customer dissatisfaction – and with three operators offering the iPhone in a single market, that could be significant.
“With 2G, operators could infill poorer areas,” Lamour said, “but you can’t do that with 3G. In fact it is counter-productive, as it just increases interference and lowers capacity.
Increased bandwidth with widespread HSPA is one obvious answer. Yet two years after it announced its first iPhone launch, O2 is still rolling out its 7.2Mbps HSPA network in the UK, with a public commitment to cover 30 cities in the country by the end of 2009. Lamour placed Orange at about the same level of HSPA coverage, with Vodafone slightly ahead, due to its focus on business customers.
And if networks are upgraded to meet the forecasted rise in data usage, then the already fragile business case for the iPhone becomes even flimsier, as operators offset the cost of enhancing the network against the customer acquisition capability of the iPhone.
“From my point of view, certainly the early adoption of the iPhone was a marketing loss leader for operators, with no real revenue business case. That’s why they have to look at their existing assets to do as much as they possibly can, relatively cheaply.”
Lamour said that operators can achieve great results just by making sure their network is properly optimised. By making simple configuration changes such as altering the tilt and direction of antennas, and configuring sites properly, Lamour estimates operators could achieve a 30% boost to available capacity.
He cited one example of an operator Actix worked with where in a 100 site sample, 30 sites turned out to be operating inefficiently because the installation engineers have connected the wrong cable to the antenna. “Networks aren’t always as sophisticated as we think they are,” he said “and even the more specialized stuff relies on the basics having been done.”
In time, though, as more handsets that offer similar capabilities come onto the market, such as the Android devices recently launched, and the Palm Pre, and even devices taking advantage of services such as Vodafone’s recently launched 360, then operators will be faced with no option but to upgrade networks – either through re-farming spectrum for 3G or making the move to 4G. But right now, as they face the impending launch date for the iPhone, there are simple steps they can take to make sure they avoid falling into the trap that snared AT&T and O2.