Today's Comment: Virgin launches London Underground Wi-Fi; Portugal Telecom taps Huawei for LTE; Telefónica's Tuenti launches in stores.
- The Virgin launch as the first time Internet connectivity has come to the Underground network, but passengers will only be able to use the Wi-Fi network within certain stations, with no coverage of tunnels.
- Spanish social media website, Tuenti, has launched sales of its data-focused MVNO service within Movistar stores.
Today we focus on three developments:
- Virgin Media has switched on the first of its Wi-Fi hotspots in the London Underground metro network, with plans to add as many as 120 such sites in the United Kingdom capital by the end of the year. Cable operator Virgin has said that at least 80 of the hotspots will be live before the start of the London Olympic Games next month, and they will offer free Internet access to all users during the games, after which non-Virgin customers will have to pay a charge. The operator has also set up a number of Wi-Fi portals in stations, which will allow travellers to get free travel information from Transport for London and content from selected media partners.
- Portugal Telecom has selected Huawei to roll out its commercial LTE 4G network in the country, hoping to offer mobile broadband download speeds of up to 150-Mbps. The incumbent operator will make use of Chinese giant Huawei's SingleRAN technology to integrate LTE into its existing GSM networks on a single platform, saving costs and accelerating rollout. Portugal Telecom is forging ahead with the domestic rollout of its LTE, having already revealed plans to extend coverage to some 80% of the population, while it intends to increase this to more than 90% of continental Portugal by the end of 2012 (see Portugal: 17 May 2012: Analyst Commentary).
- Telefónica's social media website, Tuenti, has increased the availability of its mobile services with 5 Movistar stores in Madrid selling the service in a pilot. The mobile virtual network operator (MVNO) launched in February 2012, focusing on low-cost data and smartphones to facilitate access to the website. By launching in stores Tuenti is looking to increase its subscriber base, targeting pre-paid data-users. Displaying the service in stores will also alert more users to its availability without increasing marketing spend. However, it also allows Telefónica to increase its slice of the lower-end of the market without damaging its existing pricing structure, keeping its Movistar brand as its premium service as it targets defending its high margins in 2012. In the mobile market Telefónica has felt the brunt of the damage from MVNOs increasing their market share as the Spanish economy stutters; at end-2011 the MVNOs and Yoigo—a low-cost network operator—have increased their market shares to 7% and 5% respectively.
While Virgin Media is trumpeting the launch as the first-time internet connectivity has come to the London Underground, it is worth noting that passengers will only be able to use the Wi-Fi network within stations and on trains that are parked in platforms—making the launch a far cry from providing full connectivity within London's underground tunnels. A number of companies have examined the possibility of bringing Wi-Fi or 3G-based connectivity to the tube, but the depth and complexity of the tunnels and the aged and often-crumbling nature of the infrastructure has made this a very difficult challenge (some tunnels date back to the 1860s). The UK's mobile players along with Chinese vendor Huawei dropped plans to bring a 3G network to the metro network last year due to the technical challenges of the scheme (see United Kingdom: 4 April 2011: Plans to Bring Mobile Coverage to London Underground Falter), while Virgin's fixed-line rival has trialled a number of Wi-Fi hotspots in deep-level underground stations, but has no plans for tunnel coverage (see United Kingdom: 23 September 2011: BT Aims for 500,000 New Wi-Fi Hotspots As Race to London 2012 Olympics Begins). Meanwhile, Virgin Media has recently launched trials of small-cell LTE mobile solution in the capital, as it looks to boost its mobile broadband offering with the use of picocell technology (see United Kingdom: 27 February 2012: Virgin Media Starts LTE Picocell Trials, Targets Further Spectrum Gains).
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