As Telstra sits on Next G, Optus starts 4G trials

Optus parent SingTel has taken a proactive jab at Telstra and other rivals with the announcement that the group will test Long Term Evolution (LTE) mobile technology in Australia Indonesia the Philippines and Singapore during a six to nine-month trial set to begin next year.

Often referred to as ‘4G’ LTE is the next generation of UMTS the current 3G wireless technology and promises LAN-like speeds of more than 100Mbps and less than 10ms latency. The improvements come thanks to a variety of enhancements including an all-IP networking architecture and the use of lower frequency bands enabling higher-speed transmission.

This has made it the favoured technology for use in the 700MH radiofrequency spectrum band which is currently occupied by analogue TV broadcasting signals but will be freed up after analogue TV is shut down – which in Australia will happen in stages through the end of 2013.

Although carriers around the world have recently been jumping on the LTE bandwagon the announcement of formal LTE trials is particularly pointed in Australia because LTE is currently a key negotiating tool in Senator Stephen Conroy’s efforts to push Telstra towards voluntary separation.
In announcing the planned separation in September Conroy said Telstra would be prohibited from accessing the spectrum necessary to run LTE unless it met a number of conditions including voluntary separation and divestment of its interest in Foxtel and the HFC network that carries it.

Unsurprisingly the plan raised hackles at Telstra which sees LTE as an important next step despite its massive investment in its current Next-G network which Telstra claims will support maximum speeds of up to 42Mbps in the near future.

“Spectrum has finite capacity” CEO David Thodey warned when asked about the magnitude of Conroy’s threat during Telstra’s recent investor day. “It is important to look forward to the future and spectrum is a requirement….If we are prevented from getting access to LTE spectrum in effect that will take one provider out of the market in rural Australia. This is not about creating competition; this is doing exactly the opposite.”

CFO John Stanhope even went so far as to make the jaw-dropping pronouncement that separation could be a “win-win for shareholders” if Telstra gets access to “advanced wireless spectrum” and among other requirements keeps its HFC and Foxtel interests.

While Telstra waits nervously for the legislative situation to emerge the announcement that SingTel will begin its LTE trials adds additional pressure to the carrier which like most telcos has made wireless a key part of its shift away from its traditional fixed-line business.

Development of clear LTE plans will be critical in coming years as an expected explosion in 4G networks comes to fruition. IDC this week predicted rapid growth of LTE as the popularity of 3G forced telcos to find new ways to meet rapidly-growing demand for mobile data.

“Most if not all [Asia-Pacific] markets will need to move to an all-IP 4G infrastructure” Asia-Pacific telecommunications research director Bill Rojas said. “The current propaganda of LTE infrastructure is being concentrated on developed APEJ markets…but this attention is not addressing another huge opportunity… the pent-up demand of under-served broadband households.”

SingTel’s statement suggests the carrier group is poised to move quickly to establish a consistent LTE-based technology foundation on which it can deliver advanced wireless data services. With 273 million SingTel customers across eight countries (the four hosting the trials as well as Bangladesh India Pakistan and Thailand) the trials – which will involve Alcatal-Lucent Ericsson Huwaei NEC Nokia Siemens Networks and ZTE – would pose a significant threat to the established regional mobile order.

“LTE will open doors to new and more powerful mobile solutions that will transform the way our customers across the region live work and play” SingTel International Group CEO Lim Chuan Poh said in a statement.

“The regional trials underscore SingTel’s commitment to offering our retail and enterprise customers more innovative services that are at the cutting edge of technology…. We are in an excellent position to drive the adoption of LTE technology in the region and beyond.”