Building a wireless network isn’t easy. You need to purchase spectrum from the government, get a sizable loan from the bank, go to an infrastructure provider like Ericsson or Nokia Siemens networks and sign some contracts, and then you need to start all sorts of advertising campaigns and may even have to open up a few retail shops so revenue can start pouring in. It’s not the most efficient model in the world, but it’s unlikely to change in the foreseeable future. Now that 4G is one of the hottest topics in mobile, operators are asking themselves what’s the best strategy going forward for adopting new equipment? Should they follow in T-Mobile’s footsteps and stick with HSPA+ for as long as possible, or should they be like TeliaSonera and be at the bleeding edge of wireless technology? One thing is certain, if you’ve got multiple operators, each executing a different strategy, then the rollout of 4G slows down to a crawl. That’s the thinking behind the latest news out of Russia. Beeline, Megafon, MTS, and Rostelekom, the big four, are going to work together with Yota to build a nationwide LTE network that they’ll all be sharing.
Yota started out as a WiMAX ISP, and they’ve got the largest WiMAX network around today, but recently they’ve decided to switch to LTE. By 2014 their goal is to cover over 180 Russian cities and 70 million people with high speed internet access. If this sounds familiar it’s because that was the goal of Clearwire. They are a WiMAX ISP that resells access to their network to various companies who then slap their own brand name on a USB modem and then sell it to unsuspecting consumers. Rumor has it that they’re going to switch to LTE as well by the end of this year. LightSquared is roughly the same thing, but they’re going to be using LTE from the get-go, and they’re not even going to have a direct to consumer channel, instead building a network that’s purely there for big businesses to resell.
No competing on where to put towers. No arguing about coverage maps. Just put as much money behind a network as you possibly can, make it the best there is, and then find something else to compete on. Customer service, tariffs, subsidies, whatever.