The Five Laws of

4G Launch Success
Crucial lessons can be learned from this years burst of LTE
launches. So what defines the most successful operators so
far and where should executive teams place their strategic
focus? With behind-the-scenes access to dozens of recent
LTE launches, we ask 4G strategy expert Leslie Shannon
what matters most for 2013.

What youll learn

1. W
 hy it really is time to say goodbye to unlimited
data plans
2. H
 ow to help 3G customers experience 4G in ways that
lead them to profitable plans
3.W
 here the network coverage tipping point for LTE
subscription lies
4. How LTE handset availability impacts subscription levels
5. W
 hat leaders can learn from the video game
industry about maintaining high performance inside
implementation teams

If making money from 4G is

what keeps you awake at
night, Leslie Shannon is a
useful person to know. Since
2008, Leslie has helped
more than 65 operators in
40 countries shape and
Leslie Shannon implement wideranging 4G
strategies. So
what has that
experience taught
her about what
makes a great LTE
launch?
Its really about five key
things, says Shannon,
But it all starts with price.
1. Pricing: beyond
unlimited
If I had to pick one factor that is having
the greatest impact on LTE subscription
levels, it would be competitive pricing,
says Shannon, who has been
studying the drivers of global mobile
data uptake since 2002. The evidence
from operators such as Verizon in
the US, DoCoMo in Japan and LG
Uplus in South Korea shows a clear
link between competitive pricing and
customer growth, she continues.
Pricing is inevitably a key concern for
every operator, especially when a major
service provider such as Vodafone
Germany announces that 85% of its
mobile broadband traffic is generating
zero revenue.
Shannon sees two key pricing issues
attracting the greatest attention
from executive teams inside service
providers:

i) Unlimited data: do or die?

The rise of mobile broadband has
triggered a kind of pricing schizophrenia
in many markets, says Shannon.
Operators have had a stormy love
affair with unlimited data plans,
exploring various strategies to grow
market share and experimenting with
new revenue models.
The growing consensus amongst

operators that Im working with is that

unlimited data plans will be bad for
LTE business, she continues. In fact,
theres an understandable desire to
use LTE to help phase out the unlimited
data experiments of 3G. Tiered plans
with data sharing options are definitely
high on most operators agendas.
Shannon points to 3s UK unlimited
3G data plan as a case in point: The
research shows that the strategy
generated five times the data usage
compared to other networks, but at
what opportunity cost?
All you can eat but not hungry?
Yet some operators believe that its
still too early to write off unlimited
plans. Earlier this year, Kim Larsen
from T-Mobile Germany showed that
most users on its unlimited plans only
consume an average of 500MB of data
per month.
Research from NPD in the United
States, the country with the worlds
highest LTE prices, reinforces the point
showing that only a small proportion
of unlimited plan subscribers consume
more than 3GB of data per month.
Shannon offers one caveat around
unlimited data: Theres no doubt that
unlimited data plans can be useful
for operators who want to take back
market share, or use it as a tactic to
disrupt a market, she says. But with
10 years of 3G pricing angst behind us
theres little evidence to suggest that
unlimited plans will be a sustainable
strategy for operators.
And when we consider that in places
where LTE has been around for a
while, such as at DoCoMo in Japan,
LTE usage is nine times higher than
3G usage, she continues. Offering
unlimited data plans in LTE is just
opening the floodgates to giving away
massive amounts of unmonetized
data.

ii. Pay for 3G, get 4G

Well look at acquisition strategies
in more detail later, but a winning
approach for generating fast-growth
subscriptions in several markets has
been to offer LTE at the same price as
existing 3G services.
Verizon went
to market
with a hugely
aggressive

short-term pricing strategy that seems

to have paid dividends, says Shannon.
Its Twice The Data. Same Low
Price campaign gave customers a
choice between 2GB on 3G or 4GB
on LTE for just $30. The campaign
triggered millions of new subscriptions
and that set Verizon on a 4G growth
curve that has endured beyond the
pricing strategy.
As part of its three-pronged LTE
launch strategy, Danish operator 3
is using a similar promotion to help
retain customers who may have been
considering a switch to LTE competitor
Telia Denmark. 3 offers existing 3G
customers a free transition to LTE
so long as they have a 4G capable
handset.
Its an interesting approach, says
Shannon. It provides customers with
a reason to stay with 3, introduces
customers to the must-have-more
LTE experience, and also provides a
pathway to the higher tiered plans that
3 has subsequently launched. And to
Telia Denmarks credit, they quickly
recognized the power of positioning
their services as mobile broadband,
rather than 3G vs 4G, and modified
their own customer plans do the same.

Last out of the blocks

US operator
Sprint adopted
a similar
strategy when it
became the last of the major carriers to
announce its LTE services.
To deter customers from churning
to other 4G services, Sprint
communicated a compelling coming
soon story to reassure customers that
they would receive 4G services for the
same price as 3G, says Shannon.
Whilst such an approach might not
prevent impatient early adopters from
churning, for the majority of customers,
waiting a short while longer with
nothing to lose is more attractive than
the hassle of switching contracts, she
continues.
No doubt the recent $8 billion
injection from Softbank will help
Sprints customers feel justified in their
decision to wait, as the capital helps to
accelerate the operators 4G rollout that
began in July 2012.

2. Attraction & retention

Theres no denying that when people
experience LTE for the first time,
they usually come back for more. No
wonder operators are investing in LTE
to the extent that it is now the fastest
developing mobile communications
system technology ever, according to
the recent Global Mobile Suppliers
Association (GSA) Evolution to LTE
report.

developed appealing offers for other

products and services and then
bundled in LTE as an added extra.
DoCoMo, AT&T and Verizon offer
their customers bundles that lead with
compelling unlimited voice and text
plans that also happen to include LTE,
says Shannon.

So how are operators helping

customers get their first taste of LTE,
and what are they doing to retain their
custom?

In the US, tiering data within these

unlimited voice plans also serves as a
strategy to counter the impact of datahungry Over-The-Top VOIP services,
such as Skype. Its a strategy that is
likely to become more widespread,
Shannon believes.

Total Recall

Sharing exclusive content

Before they even consider acquisition

strategies, says Shannon, Many
operators have forced themselves to relive the painful memories of customers
using the 2G/3G transition as a contract
break point.
The key lesson? Make it easy for
customers to migrate. Really easy.
With that in mind, several main
approaches to LTE customer
acquisition and retention are emerging:

Normalizing data

In South Korea,
SK Telecom
is attempting
to attract new
customers through exclusive access
to a premium content marketplace,
which sells a wide variety of streaming
video and games. Customers of its
biggest plan receive a monthly credit
towards T-Premium content and app
downloads. 100 days after its launch in
April 2012 SK Telecom had attracted
1 million subscribers who in turn had
generated 6 million downloads.

The fastest way to give customers a 4G

experience is to make it part of every
plan. Thats the industry culture shift
that has happened in where 80% of all
handsets sold are LTE, and all come
with LTE data plans as standard, says
Shannon.

Similarly, in Denmark Telia offered

customers a Spotify subscription as an
optional add-on to one of its 4G dongle
services, and all EE customers in the
UK receive Deezer music and Filmflex
video access as part of their total LTE
packages.

Providing a reverse gear

Retaining customers through

better billing

While operators are investing heavily

in promoting the benefits of LTE, many
customers remain unsure about the
true personal benefits of the technology.
That has prompted some operators to
build an optional reverse gear into their
marketing campaigns, says Shannon.
If new LTE customers decide that it
doesnt live up to their expectations,
then they can return to their previous
contract with no complications. O2
Germany and Saunalahti Finland
are currently experimenting with this
approach.

Bundling LTE with something

more valuable
Instead of leading with LTE in their
promotions, some operators have

A simple but essential tactic for

retaining LTE customers will be better
billing communication, one of the
primary sources of customer confusion
and frustration with 3G.
With tiered LTE data plans, customers
will need continuous insight into how
quickly their handsets are devouring
data, explains Shannon. This is
especially important in the early months
of a plan when users are learning how
much data is associated with specific
types of application or download.
Operators that allow customers
to exceed their data limits without
sufficient alerts will quickly damage
their brand trust.

3. S
 peed to market vs
most to market
While being first to market can be an
important advantage for LTE service
providers, a more important, emerging
dynamic appears to be how quickly an
operator can achieve a tipping point in
high population coverage. Put simply,
more coverage more quickly means
more subscriptions.

How much is more?

Our own analysis suggests that when
an operator is able to offer LTE services
to around 75% of the population, the
tipping point in subscriptions occurs,
says Shannon. Of course other factors
are at play, but coverage is key. We
saw this in 3G: the network use really
picks up once fast mobile data is
available in places where fixed access
is limited or unavailable to many.
Korea Telecom in South Korea is a
case in point. The operator launched
its LTE services in January 2012 and
after a massive effort that saw tens
of thousands of base stations rolled
out in a matter of months, they were
able to overcome the disadvantage of
being third to market in LTE. Korea
Telecom has achieved 5% uptake
among the population covered in less
than a year, says Shannon. Its an
impressive accomplishment when you
consider that its uptake is higher than
most European LTE operators, many of
whom launched much longer ago.

Breaking the speed limit?

Some might see Verizons rapid LTE
rollout as unnecessarily risky, especially
in light of the high-profile crashes that
it has experienced in recent months.
With risk comes reward, observes
Shannon, and despite Verizons
occasional network issues, its growing
subscriber numbers certainly seem to
justify the ambitious route that it has
chosen.
LG Uplus and SK Telecom have
similar stories to tell in South Korea,
where 100% population coverage has
activated high subscription ratios. In
fact, LG Uplus is an example of how
the speed of LTE rollout can powerfully
disrupt market dynamics to the
operators advantage.
LG Uplus was a distant third in the
South Korean market, explains
Shannon. In a matter of months it has
3

4. Devices
The GSAs Status of the Global
LTE1800 Market report in November
2012 confirmed that 83 manufacturers
have announced 560 LTE-enabled user
devices. But what is the real impact
of device availability on subscriber
activation?
While multi-faceted operator marketing
initiatives can make it difficult to
pinpoint an exact correlation between
handset availability and subscriber
numbers, there does appear to be a
link, says Shannon.
For example, during its early roll out of
LTE, DoCoMo experienced bursts of
customer uptake that coincided with the
introduction of more 4G handsets.
Similarly, giving customers access to
a very wide range of LTE devices has
been a central part of SK Telecoms
rollout strategy in Korea. The vast
majority of its customers access LTE
via handsets, many of which are
deliberately inexpensive to encourage
user adoption.
When you talk to Korean operators
about dongle take-up in Korea, they
just look at you blankly, says Shannon.
Why would anyone take a dongle
when you can have a
smartphone? is their
approach, and this
makes sense. With
a smartphone, you
can have donglelike functionality
through tethering,
and having a
smartphone in front
of you all the time
gives many more
opportunities for
discovery of new
data usage, which
you dont get with a
dongle.
By contrast, operators that have
adopted a dongle-focused approach in
some rollouts in Europe have triggered
significantly lower subscriptions
rates than those experienced by SK
Telecoms device-rich strategy.

5. People performance:
avoiding burnout
Pricing, coverage, customer acquisition
and devices are all familiar issues in
a discussion around new technology
platform launches. A less discussed
topic is the impact of platform rollouts
on the performance of the people
charged with making them a success.
With some operators seeking to rollout
nationwide LTE coverage in a matter
of months, the human impact could
easily become a weak link in the 4G
deployment process.
Intense platform
rollouts usually
mean extreme
workloads and
high pressure to
perform, says
Niklas Nordling,
a transformation
and
organizational
change expert
at Nokia Siemens Networks. Under
these conditions, stress and burnout
are common, leading to performance
issues such as increased team conflict,
deployment errors, project delays,
increased employee absenteeism,
reduced morale and higher employee
attrition rates.
Niklas Nordling

leapfrogged its way into second place

and is now seriously challenging for
the number one position within the 4G
market.

From burnout to breakthrough

Smart organizations are increasingly
pre-empting the potential decline in
performance associated with intense
technology rollouts. One such company
from the video games industry is
Electronic Arts (EA) whose
technology teams face
similar workload and
performance challenges
to operators during peak
development windows.
Criterion Games, the European EA
studio that created the hit video driving
game Burnout, recently faced this issue
head on by helping employees better
manage their energy and performance
in the midst of a demanding
development deadline.

that were commonly draining their

physical, mental and emotional energy
and performance.
Triggernomics
Nordling, who has a PhD in psychology,
also advises operators to equip leaders
with a crucial skill that can sustain high
performance amongst teams that are
under pressure.
Its very important for leaders to
understand the subtle emotional
triggers that can shut down individual
performance, especially under
conditions of high-stress, he says.
Work from the NeuroLeadership
Institute shows that when employees
perceive a threat to status, certainty,
autonomy, relatedness or fairness, their
performance declines rapidly.
Helping leaders to recognize how to
navigate these issues and providing
training in advanced communications
skills can go a long way to sustaining
team performance, he says.

2013: What matters most in LTE

strategy?
So where should LTE operators focus
their energy in 2013? Shannon and
Nordling offer five suggestions:
Experiment with competitive pricing
strategies but avoid business models
that are dependent upon unlimited
data plans.
Find ways to help your 3G customers
experience 4G as a matter of priority.
Then provide a simple transition path
to tiered data plans.
Pursue tipping point population
coverage as quickly as possible.
Network crashes are fairly inevitable
so plan for them in advance.
Give people many LTE handset
options to choose from.
Help implementation teams to
maintain high levels of performance
by equipping leaders with new
skills around energy and motivation
management.

Working with
personal
performance
specialists, The
Energy Project, employees created
individual energy strategies to help
them identify and address the factors
4