Apple's iPhone 5 puts Europe in 4G slow lane

LONDON/PARIS Fri Sep 14, 2012 8:23am EDT

The iPhone 5 on display after its introduction during Apple Inc.'s iPhone media event in San Francisco, California September 12, 2012. REUTERS/Beck Diefenbach

The iPhone 5 on display after its introduction during Apple Inc.'s iPhone media event in San Francisco, California September 12, 2012.

Credit: Reuters/Beck Diefenbach

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LONDON/PARIS (Reuters) - Apple's iPhone 5, launched to great fanfare in the United States on Wednesday, will not work on superfast mobile broadband networks in much of Europe, potentially confusing consumers and setting back the development of 4G services in the region.

The problem lies in the range of spectrum - the airwaves used to carry mobile signals - used in Europe. The iPhone 5 is not compatible with 4G services on the 800MHz and 2.6GHz bands deployed across much of western Europe, including Spain, Italy and France. Instead, it works on the 1.8GHz band, which is still being used for voice calls by most operators in Europe.

Apple will produce three models of the iPhone: one optimized for U.S. carrier AT&T's network and spectrum bands, another for Sprint and Verizon's U.S. norms and a third for the rest of the world, including two European operators.

Only Deutsche Telekom in Germany and Everything Everywhere in the UK will initially be able to offer the fastest internet access to iPhone 5 users in their markets, because they are the carriers holding the right frequencies.

Apple could later introduce other models compatible with more European operators' needs, analysts say, but for now some European operators will be hamstrung.

Vodafone and Telefonica's 02 look to be at a disadvantage in the UK and Germany, two of Europe's biggest mobile markets, because the iPhone won't run on their 4G gear.

"Telecoms executives in Europe had a big dream that the iPhone would be the accelerator to kickstart 4G demand in their markets," Informa analyst Thomas Wehmeier said. "That dream has now gone up in smoke because Apple has made the U.S. and Asia norms the priority and short-changed Europe."

Europe's construction of 4G networks is lagging behind the U.S. and Asia, though European operators are expected to spend $15.25 billion over the next three years to upgrade infrastructure to 4G speeds, according to Rethink Technology Research.

The region has only a few hundred thousand 4G subscribers, most of whom use laptop dongles or home routers because there are few compatible smartphones available.

That is starting to change as Samsung, Nokia and HTC bring out 4G-compatible smartphones that work on European norms. The lack of a compatible iPhone, however, is sure to disappoint some operators hoping to benefit from the positive marketing buzz around Apple's latest device.

It remains to be seen how much a lack of 4G speeds will hamper sales of the iPhone 5 in Europe. Apple doesn't break down regional revenue, but market research group Canalys says that 22 percent of iPhones sold in the second quarter were in Europe.

Consumers don't necessarily understand the thorny details of mobile broadband speeds, and operators don't make things simpler with advertising that often refers to souped-up 3G technologies - which boost speeds via a software upgrade - as offering 4G speeds.

A survey from consultancy Analysys Mason showed that 46 percent of iPhone 4 users believe that they already have 4G capability, even though they don't.

Analyst Matthew Howett at the consultancy Ovum said that 4G capability was the iPhone 5's biggest selling point.

"Outside the hardcore loyal Apple fans, who will buy it anyway, the next biggest attraction of the device is its 4G capability," he said.

"For those markets where it can be used on a 4G network, I think it's going to do particularly well, and obviously one of those is the UK. So for Everything Everywhere, this is set to be a real winner."

Even without 4G, the new iPhone will support the faster version of 3G, known as DC-HSDPA, with up to 42 megabit speeds - faster than many home Internet connections. Long-term evolution (LTE) technology, as the true 4G gear is dubbed, can offer up to 100 megabit speeds.

O2 Chief Executive Ronan Dunne said the iPhone 5 would remain popular on its network in Britain despite the lack of 4G. "The new device will work brilliantly on our network," he said in an interview.

Hutchison's 3 brand, Britain's smallest operator, is in line to buy surplus spectrum from Everything Everywhere in the iPhone-compatible band, so it may eventually offer a faster service.

A spokesman for France Telecom also talked up the better speeds that customers of its Orange mobile brand would receive on the new iPhone in France and Spain, despite not having 4G.

However, operators have to be careful about how they advertise fast mobile broadband speeds on the iPhone to avoid breaking Apple's strict rules on marketing, Ovum analyst Howett said.

Apple was fined roughly $2.3 million by an Australian court in June for misleading advertising of the iPad, which it said was 4G-compatible when it was not.

The iPhone 5 will go on sale in the United States, Britain, France, Germany, Australia, Canada, Hong Kong, Japan and Singapore on September 21, with pre-orders a week earlier. A further 22 countries, including 21 in Europe, will launch on September 28.

(Additional reporting by Tarmo Virki in Helsinki and Sinead Carew in New York; Editing by David Holmes and David Goodman)

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Comments (4)
Nargg wrote:
I’m still waiting to see this madness stop and phones support ALL frequencies.

Sep 14, 2012 12:01pm EDT  --  Report as abuse
DanielEran wrote:
LTE may eventually support 100Mbps, but in the US, one of the few places to have actually deployed LTE, it currently maxes out around 40Mbps, making it no faster than the DC-HSPA that is widespread across Europe.

So despite all your handwringing, Europeans will be getting an iPhone 5 that is just as fast there as it is in the US.

Media wonks should stop worrying about brand names like LTE and focus on actual capabilities. Really fast data service doesn’t require LTE. I’d rather have broad coverage of fast data than sporadic LTE coverage.

Additionally, there’s nothing stopping Apple from releasing a fourth iPhone 5 model that supports the tiny build outs of LTE in areas not yet supported by the three now on sale. But there’s no reason to do so now because those carriers haven’t lined up deals to sell the new phone using their LTE service. And again, it doesn’t matter because most have alternative data networks that are just as fast.

Sep 14, 2012 12:27pm EDT  --  Report as abuse
T0M wrote:
This story lacks meaningful detail: What is the maximum speed available to the iPhone 5 in US, Europe and Asia NOW? Is this article claiming that the iPhone 5 will not support HSPA+ in Europe? Will US users of the iPhone 5 actually get faster speeds than European users? When a US user travels to Europe, will their device stop working? Or will it download at dial-up speeds? Or will it make no noticeable difference at all?

Sep 16, 2012 4:26pm EDT  --  Report as abuse
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