IHS Global Insight Perspective | |
Significance | A1 Telekom Austria began its LTE launch in November 2010 and was the first to take place in the country. |
Implications | The operator has begun offering the Samsung B3730 and will add the Huawei tri-mode E398 modem to its range. |
Outlook | A1's LTE service is part of its larger broadband strategy. It has first-to-market advantage, though it is set to be put under greater competition from its rivals. |
A1 Telekom Austria, part of the Telekom Austria Group, launched the country's first LTE service in November 2010, after it was successful in Austria's 2.6-GHz spectrum auction, which was held in September of the same year. A1 acquired 2 x 20-MHz in the paired band and 25-MHz in the unpaired band at a total cost of EUR13.2 million. The licences acquired by A1 are valid until the December 2026. Overall the auction generated EUR39.53 million, with T-Mobile Austria, Orange Austria and 3 Austria each acquiring spectrum. (see Austria: 21 September 2010: Telekom Austria Announces LTE Roll-Out Following 2.6-GHz Auction). A1 began its LTE roll-out in Vienna, soon after it had obtained an LTE licence; at launch the operator had 49 base stations in Vienna and three in St. Pölten. The prompt roll-out was made feasible after it had concluded successful trials in the 21st and 2nd Vienna districts, as well as in the Lower Austrian state capital, St. Pölten.
The operator's LTE and AirToFiber services represent two elements of A1's high-speed internet GigaNetwork. A1 began its nationwide broadband roll-out plan in 2009, targeting 750,000 households by September 2010; however it exceeded its target by reaching 1.5 million households. Thus by the end of 2011 it is targeting 2.1 million households, with LTE playing an important role in achieving this goal. In September 2010, A1 signed a five-year agreement with Nokia Siemens Networks to replace and improve its radio networks in Austria, as well as Liechtenstein and Slovenia, in addition to 3G deployments in Serbia and Belarus. The deal will enable A1 to upgrade its network, so that it can support LTE and HSPA+. Further rol-lout of both LTE and HSPA+ technologies will be dependent on connecting mobile base stations to Telekom Austria’s high-performance fibre-optic network.
LTE Pricing and Services
The LTE service, known as "A1 Broadband LTE" was launched in November 2010 and is available for EUR89.90 (USD128.7) per month, based on a 24 month contract. The Samsung B3730 Stick will have to be purchased for EUR490, whilst prices for the Huawei E398 Stick have yet to be revealed. A1's monthly pricing is in line with other LTE services available in Europe. However, it will be necessary to add more variety in terms of pricing, contract length and device, particularly once rival operators make their services commercially available.
Devices
The Samsung B3730 Stick is provided in order for customers to obtain LTE services. Users can obtain peak download speeds of 100-Mbps and upload speeds of 50M-bps, with a monthly download limit of 40-GB. Each additional GB used will cost the user EUR0.25.
A1 is set to offer its customers the Huawei E398 Stick in the second quarter of 2011; A1 customers are able to register their interest in the device on the company's website. The device is the first triple-mode LTE modem that supports LTE, 3G and 2G network accesses; it will provide users with download speeds of up to 150-Mbps and upload speeds of up to 75-Mbps.
Outlook and Implications
- LTE Deployment Part of Larger Broadband Strategy: A1 Telekom Austria is initially launching its LTE service in Vienna, after completing successful trials. The operator though has not earmarked other regions of the country to provide LTE services; instead it is including LTE as part of its long-term broadband strategy, which targets 2.1 million households by the end of 2011. A1 has signed a deal with Nokia Siemens Network in order to upgrade its network to support HSPA+ and LTE. The continual deployment of LTE will be crucial for the operator’s mobile broadband growth.
- 3 Austria to Launch LTE in 2011: In February 2010, 3 Austria announced that it was to launch LTE services following a significant upgrade provided by ZTE (see Austria: 16 February 2011: Austria Plans LTE Launch This Year with ZTE). The operator hopes to offer HSPA+ coverage to 94% of the Austrian population by autumn 2011, whilst it aims to begin rolling out LTE services to urban areas in late 2011.
- Threat of T-Mobile Austria and Orange Austria Looms: T-Mobile Austria deployed its first full-test LTE networks in the country in 2009, using frequencies in the 2.6-GHz band, laying claim to be the largest LTE test network in Europe. At the end of 2010 it revealed a further EUR500 million investment in the deployment of its network, with the aim of covering one-quarter of Austria's population by the end of 2013 (see Austria: 24 December 2010: T-Mobile Austria Announces USD655-Mil. Investment in LTE, 3G Upgrades). Orange has also tested LTE in Austria as part of its Europe-wide roll-out plans and hopes to commercially launch its network in 2011 or 2012. The entry of these two significant players will inevitably affect the competitive positioning of A1’s LTE service. Consequently it is important that A1 takes advantage of its first-to-market position.