The imperative to drive 3G services means mobile operators are going to have to get cosy about network sharing.
A new report from analyst Analysys — 3G Infrastructure Sharing: The future for mobile networks — says sharing of 3G infrastructure in developed markets is more than just back on the agenda: it is inevitable.
Emerging technologies such as femtocells and LTE (long-term evolution — the intended evolution of 3G) will require substantial investment in the near term. And operators acting alone will not be able to deliver such investment quickly enough, according to Analysys.
Cost benefits from sharing infrastructure can also be considerable, it added.
Dr Alastair Brydon, co-author of the report, said in a statement: "Mobile operators face major expenses in the coming years, including investments in femtocells, LTE, broadcasting networks and fixed broadband. As a result, most operators will not be able to invest sufficient amounts quickly enough on their own to exploit 3G's full potential."
For femtocell technology to achieve the kind of growth in service use and data consumption operators hope, it needs to be more than just niche take-up. But getting the cost per unit low enough to facilitate the firing of femtocells into scores of homes may require carriers to subsidise the hardware, which of course would come at a cost. And 3G networks also need speedy rollouts for operators to cash in sooner rather than later.
Dr Mark Heath, co-author of the report, said in a statement: "3G network coverage must be at least as good as 2G network coverage if mobile users are to be encouraged to migrate to 3G services, as operators' experience in Japan has demonstrated. Most 3G networks are nowhere near this. Network sharing provides mobile operators with the means to accelerate 3G coverage rollout dramatically."
Analysys said recent network-sharing deals — for instance, between the likes of 3 and T-Mobile and Orange and Vodafone in the UK — indicate the mobile market is coming round to the benefits of pooling resources.
Heath added: "It has taken the UK operator 3 about four years to increase its number of 3G base stations from about 5,000 to 7,500, but its network-sharing agreement with T-Mobile will enable it to increase this number to 13,000 within two years."
In January, the chief technology of T-Mobile UK, Emin Gurdenli, told ZDNet.co.uk's sister site, silicon.com, that network sharing is a no-brainer. Discussing T-Mobile's deal with 3 to share 3G network resources, he said: "It answers two questions: one of cost reduction, cost management; and the other one of improved rollout of 3G networks and therefore earlier introduction of service for a wider population in the UK."
Vodafone has also taken the plunge to get friendly with rivals in a number of countries. In Spain, for instance, it is sharing a rural 3G rollout with Orange in order to achieve a quicker rollout. While its UK deal with Orange — to share 2G and 3G masts — is more about improving coverage, said a Vodafone spokeswoman.
The spokeswoman told silicon.com: "Obviously there are cost benefits to us. And additionally there are benefits to the environment. In the UK alone we expect to take down between us about 3,000 masts."
Analysys says network sharing can take many different forms — from sharing of physical resources, such as masts and sites, to the notion of all mobile operators in a country sharing the same radio access and core networks. However, for the moment, operators appear more comfortable with the least complex sharing agreements.
The Vodafone spokeswoman said: "At the moment we are sticking with sharing the masts with a view to progressing to something else in the future. What we were originally looking at was very complex and we did have an ambition to share the actual radio access network but for the time being we are just sharing the masts."
But not every operator is ready to jump into bed with the enemy.
Speaking to silicon.com recently, O2's head of business sales, Ben Dowd, said it is standing aloof from network sharing and does not buy the cost-reduction argument.
Dowd described the fact O2 can say it owns its own network as "a unique selling point".