The 4G Curse

I came across an article on Reuters today that focused on South Korea’s involvement in 4G development.  Rather than reading about the latest updates, they were issuing a warning to the European countries adopting the technology, specifically England.  The phone company EE has rolled out the 4G network over 100 cities and towns and plan to add more to cover.  Korean companies like KT Corp and SK Telecom are rolling out a subsequent amount of data, but the users are demanding more and more and the companies are struggling to make profit on their physical devices.  The main problem that the Korean companies are facing is one that we as consumers are quite familiar with: “I want it, but I don’t want to pay THAT much for it.”  And because of this, KT Corp and SK Telecom are producing twice as much data for consumers but are not receiving anything in return and they are struggling to keep up.  In fact, the companies have only seen about a $13 increase in average revenue compared to the 3G network and devices.  So what are they trying to say to European countries that are introducing 4G in their cities and towns?

SK Telecom’s chief technology officer, Jae W. Byun, said “rolling out faster networks could enable a mobile operator ranked number two or three to become market leader because the improvement to the consumer is so significant.”  But if one company decides to launch a 4G network, other companies will have to follow in their footsteps regardless if it is financially feasible for them.  If they refuse, they will most likely be left behind in technology history and their products would become obsolete.  Then again since the cycle of electronic innovation is so fast, there will always be a pressing demand for faster and more efficient devices and networks.  So companies need to keep up with consumer demand and gives them less time to collect their profit.  Essentially this is what South Korea is trying to tell the world as we move toward 4G.

The European Union is caught in the middle of this warning.  What that means is that they are desperately trying to catch up with Korea, Japan, the United States and other countries so they do not become technologically irrelevant, but at the same time their economy cannot handle such a big investment.  It would cause higher telephone bills for consumers and break spectrum radiation regulations.  EE is continuing to establish and develop 4G towers to reach places in the UK and other EU countries, such as Germany and Sweden, are starting to use the LTE system for their daily data coverage.  America has kept up well with the 4G coverage, but you also have to consider the EU has a lot more to handle than we do.  So would that also mean that the demand for faster networks be more imminent  than in South Korea?  Truthfully, the EU should take the risk of adopting 4G for every country as long as there is a financially stable way of approaching it.  But if the new technology will make the people demand more data and devices and the companies are left struggling for money, then that would dig the EU into a bigger deficit than it already is.  Curse is definitely the right word for 4G in this situation.


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