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Is 4G keeping up with channel expectations?

Alex Yau
August 25, 2016

Mobile News asks B2B dealers for their views and what benefits (if any) they’ve had so far

It’s been four years since the now former CEO of EE Olaf Swantee first flicked the ‘on’ switch, bringing the UK its the first 4G network – a moment in history that, we were lead to believe, would change the world as we knew it.

Swantee, who left EE in February, described that day in October 2012 as a “significant milestone” for businesses in the UK, who would now be able to enjoy the huge advantages of “super-fast” connectivity. Similar sentiments have since been echoed from O2, Vodafone and Three all of which who joined the party within 15 months.

But as more and more talk turns to 5G, due to go live here in four years’ time, has 4G truly fulfilled its potential and promise?

Mobile News spoke to seven UK airtime resellers, asking their views on the impact 4G has had on their business and their customers. They are; Next Communications MD Mark Finlayson (MF), Elite Business Solutions manager Suzanne Brogan (SB), Pastel Solutions BDM Calvin Davis (CD), Pescado group MD Fraser Watson (FW), Welcomm purchasing manager Darren Tiday (DT), Rainbow Communications sales director Stuart Carson (SC) and former Onecom sales director Steve Allan (SA).

Has 4G had the impact you had been led to believe?

MF: “No, I don’t think it’s had a lot of impact at all. I’m not convinced it’s everything the operators said it would be. It’s improved performance, but it just offers higher speeds. A lot of people have higher speeds on their phone than they do with broadband, but that just provides a progression from 3G rather than a revolution. It’s just a better wheel and I can’t really see the transformative element.”

SB: “It’s had a massive impact on all businesses and it offers something different to 3G, which was slow and clunky. Everybody is more contactable and we can work 24/7 because it’s quicker and easier to use. Everyone was just expecting slightly faster 3G, but 4G has far exceeded that expectation.”

FW: “I don’t think it has changed the world. It’s a game changer in terms of physical speed. The difference between 2G and 3G wasn’t that great. The difference between 3G and 4G is much more noticeable.

“Customers now talk to us about data usage more prevalently than minutes and texts. Data usage leads conversations. Voice and texts are subservient to data now.
“We primarily trade data bundles instead of minutes like we used to.”

What benefits does 4G give your business and customers? Is it just about fast download speeds?

DT: “Products such as Office 365 and cloud storage are being helped by 4G. Our targets would otherwise be difficult to hit. Customers would be less likely to buy these products if they didn’t think their internet connection was stable or strong enough. If you compare Q1 last year with Q1 this year, 4G has helped us exceed our targets in this area by 600 per cent.

“Customers also find it easier to avoid WiFi and just browse on 4G. The speeds don’t offer a great deal of difference and 4G is certainly just as good as WiFi, if not better.”

SA: “It’s spurred on by the fact that multimedia conferencing services like Skype have suddenly become very usable on the move. It’s enabled the growth of the multimedia communications market. Can you imagine not having a Skype call these days? Customers are able to do on their mobiles what they otherwise can with a broadband connection.

“People are able to work more efficiently across multiple devices. The accessibility to cloud technology has become more efficient. Customers know they can pull up any document on every device they work on. It enables them to work anywhere. We’ve come a long way in four years.”

The need for speed

MF: “People are pleased with the faster data speeds. The networks were over-congested on 3G and couldn’t offer acceptable speeds to clients. 4G has given them a lot more bandwidth, which has certainly helped improve and increase the quality of data coverage in wider areas.

“A lot of people have higher speeds on their phones than they do with broadband now. The transfer of data and VOIP calls has been enabled with 4G because it’s a steadier platform. 3G would cut out most of the time. It’s not just about the speed; it’s about stability and whether our customers don’t need to worry about it cutting out wherever they are.”

Have these benefits helped bring revenue to your business compared with when only 3G was available?

DT: “There is an impact in the fact 4G products can be more expensive to source, and we can’t make as much profit because of this. We have a smaller retained profit margin with 4G. We can’t put as many deals together because you pay more for a 4G product than you do with a 3G one. As far as sales with 3G products, we still do sell them. I wouldn’t say 4G has had a massive impact because we’ve sold equally as many products here as we did with our 3G services.”

MF: “I don’t think it’s had a negative or positive impact on our business financially. It’s just another piece of what we do and it has encouraged a small proportion of people to upgrade, but that was inevitable with the increase of smartphones.

“It’s not so much of a differentiator as it was in the beginning. Business customers just assume they’re getting 4G and don’t differentiate between the two. They just see it as another data connection and I don’t think people spend a huge amount of time worrying about it.

CD: “I don’t think it’s had a massive financial impact to be honest. We just work with what’s available at the time. It’s no different to the 3G products I was selling five years ago. It’s just super-fast speeds. People only need phones more for calling than anything else.”

How much of your base is now 4G? Are people still asking for 3G or feature phones?

CD: “The company still deals with the care industry and sells the odd 3G contract but all of my own customers are on 4G, however, because they all go for smartphones. There’s just no need for a feature phone because of what a smartphone can do. We do get the odd engineering company that may not need a smartphone because of the environment they work in, and the cost of replacing or insuring a handset.”

FW: “We’re automatically giving our customers a 4G handset as we’re upgrading them. I don’t remember connecting customers to 3G for a very long time.”

Smartphone adoption

“We don’t really sell many feature phones anymore because the quality of smartphones on the marketplace is phenomenal. They can do everything features phones can and much more. Android and Apple are way up there in that respect.”

SC: “We sell very few features phones now. The only customers who ask for feature phones are those who don’t have any need for data, and only need the devices for on-site work or the occasional text, or try to restrict their employees from using too much data.”

Are UK businesses making full use of 4G?

FW: “Yes, because businesses are using it for much more than just speed or stability. We’ve got customers who use it for back-up or disaster recovery. Construction firms need a temporary broadband line when they’re on site. We just provide a 4G router and SIM and suddenly you’ve got an office that’s working on VOIP. They only pay around £25 per month rather than £200 for a longer-term contract with BT.”

CD: “The main thing customers use 4G for is accessing the internet, emails, general browsing or satellite navigation. Coverage and speed are the most important factors for these to work. Other than that, I don’t see there being any more benefits or ways customers can use 4G.”

Have you experienced any negative attitudes to 4G?

DT: “The promotion of quicker speeds without having to connect a WiFi connection is always going to be attractive, but patchy coverage prevents everyone from benefiting. Some customers have had to wait a long time to use 4G because they’ve only been able to get it in their area over the last couple of months. It’s a shame it couldn’t be rolled out everywhere at the same time.”

Pros and cons

SC: “4G is considered more of a consumer product for people who want to stream music or films. You’re less likely to want that type of feature if you’re a business because it isn’t really for your market. 4G isn’t having that big of an impact because it serves more of a consumer purpose than a business one.”

FW: “We talk to customers a lot more about mobile-device management. Businesses want to limit people’s usage because they don’t want their employees racking up enormous data bills. Yes, 4G offers more data at a faster speed than 3G, but you’re going to be using the data at a quicker rate. We always make this clear to customers because they can otherwise end up with horrendous data bills.”

What innovations and tech advancements  are you looking forward to seeing as a result of 4G, both in B2B and B2C?

FW: “The future’s definitely over router deployment and back-up for building sites and temporary buildings. When there’s a building company we look after, they usually have no connectivity. They need the internet for PCs and VOIP phones.

“We provide them with a 4G router with SIMs and the speed of service is quick and stable. It’s faster than normal fibre and they don’t have to be tied to a 12-month contract with a broadband provider.

“IoT and M2M will also be big. There are businesses who will be able to diagnose problems with their equipment from a remote location. They won’t have to send engineers, which is obviously a huge cost saver. “

DT: “M2M and IoT products like tracking devices will become quite useful in the future because 4G will enable a quicker connection for them to work on. SIM cards in cars used for tracking or diagnostics will make it easier and quicker to receive information. The next five years will see a massive change in technology. The quicker the connection, the better it will work. 4G offers a more seamless experience.”

Future opportunities

SA: “If the capacity becomes greater on 4G, then voice will go to the internet rather than airtime because of the coverage and speeds. Skype and WhatsApp will become more predominant. Minutes will be less important. You won’t be paying for minutes, but data to speak. The trend will be voice over data.”

SB: “I think there’s definitely more to be gained in the longer term, especially in the IoT market. More can be done with that. You have SIM cards that can be connected and businesses can check fuel levels of company vehicles or control their utilities remotely. I think everything can be so much more connected with 4G and that side of the market can explode if used in the right way.”

Will B2B help you to boost revenues in the future?

FW: “There will be a considerable growth in revenue with IoT and deployment products, but awareness has to increase. The customers need to know that these products offer more than just fast speeds. Three years ago we didn’t see 4G and IoT as a significant revenue stream , but now we manage it on a monthly basis. Voice and text is still hugely significant, but data and IoT are being taken up at a vast rate.”

DT: “It’s too early to say, but M2M and IoT products will be easier to sell if there’s a faster and more suitable 4G connection available. Customers have more confidence that these products won’t be sluggish or cut out if they’re on the move. 4G will definitely help us sell these products more greatly. “

SA: “It will be a balance for businesses if the trend goes towards voice over data. Yes, the price of airtime might go down but the cost of data, new handsets or other products may go up. From a business point of view, it will be a balancing act.”

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