Vodafone looks to outgun rivals with extensive 3G handset launch portfolio

22 Sep 2004

The race to roll out consumer 3G services in the UK in time for the lucrative Christmas shopping period is heating up, following the announcement by market leader Vodafone that it has a portfolio of nine W-CDMA handsets ready for launch in November. Vodafone has signed up six manufacturers – Sharp, Motorola, Samsung, Sony Ericsson, Nokia and NEC – to provide it with a portfolio of ten handsets for the launch of commercial 3G in all of its 26 markets, bar Australia and New Zealand, by year-end. Nine of those phones are destined for the UK, where the cellco will be offering a range of handsets that is likely to far outstrip the choices on offer by its rivals. Outside of the UK Vodafone is understood to have ordered several million phones, including seven different handsets for its struggling Japanese operator, Vodafone KK. The group has only a small fraction of Japan’s burgeoning 3G market and has been beset with handset desirability and battery life problems.

The UK’s four biggest mobile network operators – Vodafone, Orange, T-Mobile and O2 – all market a 3G data card product for corporate users, but so far only Hutchison Whampoa subsidiary H3G UK has launched handset-based UMTS services. After an initial period blighted by technical problems, H3G UK, which offers services under the ‘3’ brand, has been signing up customers at a steady rate. However, the catalyst for its moderate success has been its decision to steer its focus away from the advanced data properties of its 3G service and concentrate instead on offering cheaper voice calls and more bundled minutes than its 2G rivals. Ironically, its biggest selling handset is the Nokia 7600, which does not support its flagship streaming media capabilities. Whether or not UK consumers are prepared to spend big on advanced services could yet decide if the UK’s operators recoup the massive investments made in 3G technology.

Orange is rumoured to be planning a 1 October launch for its consumer 3G phones, with the LG U8150 and Sony Ericsson’s Z1010 part of its range of ‘several handsets’ confirmed so far, whilst T-Mobile has said it will have at least four 3G handsets in time for Christmas, though a launch date has yet to be set. Details concerning the launch of O2’s consumer 3G service remain sketchy. The UK’s fifth-largest cellco by subscribers, MVNO Virgin Mobile, has not released any plans for rolling out 3G services. At the beginning of July 2004 both O2 and Orange claimed to have the most extensive 3G networks in the country, with each boasting coverage of around 66% of the population, whilst Vodafone had little more than half that figure and T-Mobile has not released details of its coverage.

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