To start with, it's important to note that the perceived shortfall is not that great. Our recent report, 'LTE in Western Europe: only Spain without commercial LTE', shows that LTE has been launched in all western European countries except for Spain, and even Spain has caught up since that report was published, with the launch of LTE in the past few days by Vodafone.
Even so, we should realise that Europe already has extensive, advanced 3G networks, used at a high rate by millions of people. The consumer is not concerned about the roll-out of 4G. The operators are not in a hurry either, as they can continue to exploit their 3G networks and upgrade to further evolutions of HSPA. In addition, Europe has a very mature broadband market (with widespread public Wi-Fi), making 4G less of a necessity than in places where broadband is not available everywhere. In comparison, East Asia has always been a market of early adopters, while the US actually never had 3G, relying mainly on 2G (CDMA) and its upgrade (EV-DO). This made the move to 4G in the US more urgent. In a game of one-upmanship, this puts the US a step ahead - a small disappointment perhaps, but so be it.
Of course, it's regrettable that LTE has a slow start in Europe. LTE offers improvements in terms of speed, capacity and especially efficiency and costs. The fragmentation in Europe has likely played a role, as there is no pan-European regulator to coordinate the release of spectrum. In countries such as the Netherlands and the Czech Republic, auctions have been delayed due to political efforts to introduce newcomers in the market. And in various countries, including Belgium, important spectrum has yet to be released.
Getting the most out of 3G is driven not just by technology, but also by finances. Many of the big European incumbent operators are in a difficult financial position and prefer to delay major investments. At the same time, prices are somewhat lower in Europe (meaning it takes longer to earn a return) and the economies of scale are smaller than at an operator such as Verizon Wireless or AT&T Mobility. Added to that is the ongoing economic crisis, which has hit Europe the hardest.
In any event, mobile internet is widely used in Europe, and which technology is used is not much of a concern to consumers. The motivation for switching to LTE comes mainly from the equipment suppliers, government and the operators, and on the face of it, there's nothing wrong with that. However, the advanced 3G networks in Europe mean that there is a bit less incentive to start on the path to 4G.
