4G Tardiness To Cost UK Economy £120m

The late arrival of 4G networks in the UK is set to cost the British economy, according to a new report.

According to new research from eBay, the very late arrival of 4G networks in the United Kingdom will cost the economy an estimated £120m this Christmas, because of lost sales via mobile devices.

Connection Frustration

At the moment, one item is purchased every second using the eBay app in the UK, and it is predicted that more than half of consumers would have increased their online shopping from mobile devices this year compared to last year, had better connections speeds been available.

The research suggests that with better connection speed, mobile sales would have been one third more than current predictions, up to £493m from the £373m that has is expected for direct mobile sales this Christmas.

It cites the fact this Christmas over half (55 percent) of consumers plan to use their mobile device more than they did last year to browse the web, while almost the same number say they will use mobile devices to get inspiration for gift ideas and to check prices or product details (39 percent).

Meanwhile eBay.co.uk expects to see around a third of items in its Christmas campaign bought through a smartphone.

Mobile Commerce

The research believes there are three main barriers preventing consumers from shopping on their mobiles. These barriers are slow connection speeds, payments timing out, and network reliability.

“Mobile devices have become virtual stores in our pockets, giving us the ability to shop anytime, anywhere,” said Clare Gilmartin, vice president of eBay Marketplaces, Europe. “But for consumers, it’s critical that the experience is quick, seamless and simple. Slow browsing speeds and breaking connections are now significant barriers to mobile commerce – and this comes at a high price.

“While we welcomed the move by Ofcom to bring the 4G spectrum auction forward to early 2013 there’s no doubt, as this research shows, that for the UK economy the cost of another Christmas without universal 4G is huge,” Gilmartin added. “Consumers are increasingly demanding a better experience, regardless of their network. We hope that the Government will work quickly come the New Year to ensure its promise to deliver 4G for all by the end of 2013 is realised.”

This is not the first time that research has predicted a negative impact on the British economy from the slow arrival of 4G networks. Last October a report from policy advisory group Open Digital warned that the late arrival of 4G networks was costing British businesses £732 million a year.

The arrival of 4G networks in the UK has been a long time coming, when compared to many other countries. Countries such as Norway and Sweden, and the United States, have had 4G LTE networks since 2009 and 2010 for example.

First 4G?

Earlier this week, Everything Everywhere (EE) announced that its 4G network had opened in 10 cities, namely London, Manchester, Bristol, Birmingham, Cardiff, Edinburgh, Leeds, Liverpool, Sheffield and Glasgow. It pledged another six cities would be connected before Christmas.

EE has heavily touted this as Britain’s first 4G service, although this is not actually the case.

In actual fact, the first commercial 4G network deployment in the UK arrived in February this year, when UK Broadband switched on an LTE network in the London Borough of Southwark, incorporating South Bank.

Prior to that, a number of WiMax networks have also been available in certain locations in the UK.

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