iPhone 5 signals further competition in the 4G arena

The release of the iPhone 5 with 4G connectivity could see 4G competition increase further.

4G competition is heating up following today's release of the iPhone 5 with 4G connectivity, with Optus and Telstra offering 4G services.

Both Telstra and Optus have confirmed they will be selling the iPhone 5 and offer 4G services on the smartphone.

The 4G market is becoming increasingly competitive, with telcos keen to stamp their mark on the network.

Telstra recently announced it was ramping up its 4G coverage in major Australian cities. Over the next 10 months, Telstra will boost 4G LTE coverage in Sydney, Melbourne, Brisbane, Adelaide and Perth and will install 1000 new LTE base stations by mid-2013.

It began trialling a 4G network in Newcastle, with the second phase of the trial taking place earlier this year.

4G in Australia: the state of the nation

Telstra has already started to build up its 4G phone offering, recently announcing it would release 4G-enabled Motorola Android phones before the end of the year. Current Telstra 4G smartphones sold in Australia include the HTC One XL, the HTC Velocity 4G, the Samsung Galaxy S II 4G and the HTC Titan 4G, while the telco has confirmed that the Samsung Galaxy S III 4G would be released in October.

Optus has also been active with its own 4G network, launching 4G for businesses in July this year in Sydney and Perth, with Melbourne due to join the network September 15.

Like Telstra, Optus also began trialling its 4G network in the Newcastle region, switching on its 4G network in the area in April this year, in tandem with Telstra's trials in April.

Virgin Mobile, which uses the Optus network, will also sell the Samsung Galaxy S III 4G smartphone, with Amaysim and Boost Mobile, which also use the Optus network, also planning to use Optus’ 4G network to offer 4G services to customers soon.

Meanwhile, the Vodafone is pushing what it calls 3G+, with download speeds between 1Mpbs to 16Mbps, with an average download speed of 8Mbps.

The telco is still yet to announce any concrete plans for the release of a 4G network. However, it has said it plans to launch its own 4G LTE network in some areas from 2013, with download speeds on its 4G network to be between 2Mbps to 40Mbps, with an average download speed of 15Mbps.

However, the future of 4G in Australia may not prove to be smooth. Paul Budde, telecommunications analyst at BuddeComm, has said 4G LTE networks could be limited by a lack of spectrum and predicts congestion problems could arise due to telcos sharing spectrum.

“What you then see is that because there is limited capacity, there is simply not enough spectrum. Then in order to manage the network the mobile operators will in one way or another limit the amount of activity on the network,” he said.

“One of the ways you can do that is with pricing … [Therefore] it will always be more costly to use a large amount of capacity over a mobile network than it is over a fixed network.”

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