I recently attended a round-table event with Kevin Russell, CEO of the 3 network in the UK. If I’m brutally honest I went expecting him to repeat the usual messages. Over the past few years Kevin has been unwavering in his views that spectrum allocation and termination rates have been detrimental to 3’s business in the UK. His focus on these areas is understandable and in Kevin’s defence, I’d probably be pursing the same agenda if I were in his shoes.
So I got a pleasant surprise as I listened to what he had to say at this event. Of course, he covered the usual topics, but I came away thinking that 3 has made such progress with its network over the past couple of years that it’s now in a position to take the fight more directly to its competitors, particularly among contract customers.
A few years ago 3’s management team placed a bet on offering the best 3G data network in the UK. Realising this vision hasn’t been an easy journey. It became clear that expanding 3’s infrastructure would not be viable. Creating cell sites in the UK is virtually impossible these days, with lobby groups pushing to block any new masts. For example, 3 has deployed fewer than 10 new sites within the M25 in four years.
The only solution was to do a deal with a competitor and embark on a shared-infrastructure programme. T-Mobile became 3’s network partner and, in Kevin’s own words, “it’s been hell” to overcome the technical and logistical hurdles, but the results speak for themselves.
In 2007, 3 had 7,500 cell sites in the UK. By October 2010, it’ll have 12,500 and it continues to have a long-term target of 15,000 sites. This sort of density means that not only can 3 provide much improved coverage, but it’s able to offer data capacity to content-hungry smartphone users who just can’t get enough bandwidth.
Of course, this is only one part of the jigsaw and 3 clearly understands the other pieces it needs to put in place. Having got its network up to scratch, it’s unveiled the highly competitive One Plan tariff as well as securing distribution of the latest iPhone and a host of other high-tier devices.
Put all this together and you’ve got the basis of a great offering. A robust network with capacity for growth, a punchy tariff with a giant bundle of voice minutes and text messages, a generous 1 GB data allowance that should cover the needs of 99 percent of smartphone users, and the right devices — most notably the iPhone — in the shop window. So what does 3 need to do now?
From my perspective it’s going to be all about the brand. The 3 network continues to suffer from the reputation it gained very early on. Growing pains mean that many former 3 customers have bitter memories of a patchy network, poor customer service and a limited range of devices. Bad experiences like this are not easily forgotten.
With all the pieces of the jigsaw in place, I think it’s time for Kevin and his team to reinvigorate the brand and ensure when customers on rival networks come to the end of their contracts they think about 3 as a viable alternative. If they can pull this off, 3 will go from being a disruptive challenger to a mainstream rival of the other UK mobile network operators.
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