Facebook data collection raises questions for mobile operators
The end result of this is likely to be greater regulation of social media platforms, but what this means is still up for debate. It’s possible that the imminent arrival of the EU’s General Data Protection Regulation could be a basis for other regulators.
“In the hearings, Zuckerberg repeated a concept he has been voicing for the last few weeks, and admitted regulation is now ‘inevitable’ for online platforms,” says Luca Schiavoni, an analyst with Assembly Research. “He also added, though, that regulation could be easy to comply with for a large company like Facebook, whereas this could be more difficult for a smaller start-up.
“Size of businesses aside, regulation will have to be designed with two objectives in mind: the improvement of transparency and user awareness; and the flexibility needed to make sure rules do not become outdated too quickly. To this end, well-monitored guidelines could go a long way, so long as there are sufficient incentives for companies to keep a trustworthy behaviour.”
What does the Ofcom 5G auction mean for the UK mobile industry?
Indeed, it will be the 700MHz frequencies used by Digital Terrestrial Television (DTT) that are the next to be made available at auction – possibly next year – so although this was an important development, it wasn’t judgement day.
“An unsatisfactory outcome in this auction was never going to necessarily spell the end to any one operators 5G future given that the technology will ultimately work across a number of spectrum bands, both new ones and ones already held by the mobile operators,” commented Matthew Howett from Assembly Research.
UK’s 5G auction raises £1.35bn from four bidders
The £1.35bn raised is a far cry from the £22.5bn windfall that the Treasury brought in 2000 when it sold 3G licences. It is also less than the £2.3bn raised in the 4G auction in 2013, which was seen at the time as a disappointing result for the government.
Matthew Howett, principal analyst at Assembly, the market research firm, said: “Even though the auction raised a fraction of the amount of the 4G auction or even the 3G auction two decades ago, the prices paid are above expectation which shows how valuable these airwaves are to operators, particularly given the emerging hype around 5G.”
Superfast 5G mobiles are a step closer
Analyst Matthew Howett, founder of research firm Assembly, thinks most customers will not see 5G any time soon.
"Everyone is getting a bit ahead of themselves," he said, "but the industry hasn't yet agreed on how it will be different from 4G".
Mr Howett said it would mean "faster, more reliable connection", but added: "My view is, it's a way off."
He added: "All they are buying is essentially the airwaves that are all around us and have existed since the Big Bang, because there is only a finite amount."
Cambridge Analytica whistle-blower gives evidence to DCMS Committee
5G auction bidding starts in UK
But the case for 5G services still needs to be made, says Matthew Howett, founder of research firm Assembly.
"Everyone is still unsure of the 5G business model and use cases with the hype largely being driven by those who make the network equipment," he said.
"Operators still have so much more they can do with their 4G networks and investment is still going into improving the performance and coverage of those."
5G will work across a number of spectrum bands, so those missing out in this latest auction will still be able to roll out 5G services, he added.
"Naturally all operators will be looking to limit the amount they bid given the reluctance of customers to pay more for faster speeds," said Mr Howett.
"This auction is certainly unlikely to net as much as the last auction for 4G spectrum, and nowhere remotely close to the eye-watering £22.5bn operators paid for 3G licences almost two decades ago."
Ofcom opens net neutrality probe into Vodafone and Three
Facebook is playing nice with its telecoms frenemies this year
Notably absent from Facebook’s announcements this week are updates on its more outlandish attempts to deliver internet connections, like its Aquila drone project. The idea of Aquila is to fly a gigantic drone (wingspan: 140 feet) that beams an internet connection to people on the ground. The project was the major theme of Facebook’s presence at MWC last year, but Parikh didn’t give an update this time. “Facebook has struggled to define its role in infrastructure deployment and connectivity,” said Matthew Howett, founder of research firm Assembly.
Instead, Facebook talked about more prosaic networking technologies—things like backhaul, base stations, and radios—that were more familiar to the assembled crowd of telco execs. It’s a shift in emphasis for Facebook, away from its Free Basics zero-rating efforts, in which telcos offer subscribers packages with cheap or free access to Facebook, but limited or paid access to the rest of the internet. This hit a major roadblock when regulators in India blocked Facebook’s attempt to offer Free Basics there in 2016. “Talk about drones and balloons to provide connectivity are far quieter now than before,” Howett said.
Mobile World Congress to show why Europe is the world’s 5G laggard
Regulatory inertia, insufficient investment into mobile networks and uncertainty over how local radio bandwidth will be used explain why Europe is dragging its feet. Meanwhile, rivals are ramping up investment to offer 5G high-speed connections to millions of mobile consumers in the coming years, while most EU consumers will likely wait until around roughly 2025 to benefit from the same services.
“Europe is lagging behind,” said Luca Schiavoni, a telecoms analyst at Assembly, a regulatory research company in London. “We’re seeing the same problems that we saw in Europe’s efforts to adopt the previous generations of mobile networks.”
Ofcom bolsters plan to accelerate investment in ultrafast broadband
Matthew Howett, an analyst with Assembly, argued that Openreach and its rivals need to feel confident that the proposed rules won’t shift dramatically to have confidence in making long term investments.
“It’s less about what the price is, but rather whether Openreach feels the rules of the game have changed, and whether they, and other infrastructure investors, can make similar investment commitments today knowing that the same regime will apply in the future,” he said.
Rent-a-church spire plan to boost mobile phone coverage
Digital analysts welcomed the development but said "the devil would be in the detail".
"Getting access to suitable sites, particularly in rural areas, has been a real challenge for mobile operators, so any initiative aimed at improving this will be welcomed by the industry," said Matthew Howett, principal analyst at research firm Assembly.
"What's not clear, though, is what the commercial relationship looks like. There have been many stories of rural land owners effectively holding operators to ransom for access to some sites, which has slowed down rollout and added considerably to the cost."
UK is promised a full-fibre broadband diet
However, there is genuine concern in the sector over to what extent the promises will be fulfilled. TalkTalk, for example, has only signed an initial agreement with its potential financial backer, which was revealed alongside a £200m fundraising, a profit warning and a dividend cut.
Matthew Howett, founder of research company Assembly, believes that the TalkTalk plans will be the most difficult to deliver on because of “a more complicated funding model and a shaky balance sheet that has angered investors”.
“Making the financial commitment is relatively easy. The real hard work starts with the digging,” said Mr Howett.
