3G networks at breaking point, says WiFi provider The Cloud

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[UK] This has vested interest written all over it but the claims made still seem plausible enough.

According to The Cloud, Europe’s largest mobile WiFi provider, 3G networks are at a breaking point. To blame is the rise in smartphone usage and the accompanying ‘unlimited’ data plans, along with social networking, online video and music streaming, all of which encourage data usage.

The result is “poor 3G connection in densely populated areas”, evidenced, says The Cloud, by Telefónica-owned O2’s own admission in the UK that they’ve not been able to cope with iPhone usage in parts of London. Ironically, O2 partners with The Cloud to provide WiFi access to iPhone and Palm Pre users in Britain, so I guess it’s a way of saying to the mobile networks: you need us more than ever, which is obviously the whole point of the press release. But it still raises an interesting question.

It’s the adoption of a flat rate data plans, made popular by the iPhone, which poses the biggest challenge to mobile operators, says The Cloud, in which customers are “consuming ever increasing capacity without the ability to raise prices.” If we’re to believe that the networks will reach breaking point this year with mobile internet users increasing mobile data consumption at a rate of three to five times per annum, how quickly before mobile carriers start to move away from their so-called ‘unlimited’ data offerings for smartphones (most of which are capped anyway via a fair usage policy) and start to charge different tiers for data or even offer a metered service as they did back in the dark days of WAP. Especially as new types of devices, such as Apple’s iPad, put further strain on capacity as new consumer habits are forged.

And what effect would that have on startups reliant on 3G to flog their wares?

  • Lester

    I agree this is certainly becoming an issue.. I used a fonmigo.com mobile wifi modem when I traveled to the UK. It worked like a charm with my iphone, great speed! I think they work with the Hutchinson Whampo network.

  • http://mobiletechaddicts.com Chris

    Heres a thought, instead of using the huge amounts of money these networks make from us to line their own pockets, how about investing it to provide more bandwidth and better connectivity.

    3G in the UK is patchy at best anyway, outside of city centres it comes and goes so I have no sympathy for the networks, also they rent us femtocells which do improve things at home but then charge us a monthly fee and for any data we use over 3G even though it is using our broadband connection.

    Future LTE technologies should solve most if not all of these problems, they just need to spend some money on the infrastructure and fast.

  • http://evertb.wordpress.com Evert Bopp

    Anyone with any knowledge of the mobile data or wifi industry knows that this is a hot issue. Capacity is close to being maxed out and the current data-plans offer very little ROI and do economically not warrant a capacity upgrade.
    Offloading capacity from 3G to cheaper wifi will soon be a “hot” thing (http://evertb.wordpress.com/2009/12/24/five-tech-predictions-for-2010/).
    Increased sales of 3G devices such as dongles, smartphones, iphones and now the Ipad will only increase the load on a creaking 3G infra-structure.
    There are some interesting technologies on the horizon to lighten this load though. As me for more details ;-)


  • http://grayend.wordpress.com Michael

    Well in my opinion problem become much bigger when many customers trying using service in this same time what causing overload on base station! Let say 100 iPhones start watching youtube then no way to base could handle that! Just my opinion, don;t say that is exactly !


  • http://www.linkedin.com/in/nigelwalsh Nigel Walsh

    o2 have already apologised for poor network – see here: http://blogs.wsj.com/digits/2009/12/29/mobile-problems-force-apology-by-apples-uk-partner/tab/article/

    Working in the city (Liverpool Street Area) – this saturation is already causing business issues – not being able to make or receive calls.

    I actually think the spreading of the iPhone will mean better coverage – 3 times more network capacity than o2 alone, some people will move, easing the stress, others now have a choice….

  • James

    Thats fine but the last time I used The Cloud in McDonalds I got less than 300kbs – which was slower than the 3g I was using. So if the 3g networks are broken, then The Cloud’s WiFi network is even more broken!

  • http://mificlub.com taige

    The reason you’d go for fonmigo and mificlub is because you want internet outside of densely populated areas…

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