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25 Apr 2016

EE's New Strategy: The Second "E" Really Will Mean "Everywhere"

LONDON, April 25, 2016 — EE, the U.K.'s biggest mobile operator and part of the BT Group, has announced plans for a major increase in the geographic coverage of its 4G network. It plans to increase the land covered by EE's network from its current position of 60% toward an objective of 95% by 2020. EE said it is challenging the mobile industry to adopt the geographic metric for network coverage measurement, rather than the population-coverage metric used today.

EE made 4G services available in late 2012, almost a year before the other U.K. operators. Ever since then, EE's strategy has been focused on the network, in terms of its performance and in terms of its quality. Under new CEO Marc Allera, EE's network-centered strategy will continue, but in addition to quality and performance, EE now evidently also intends to major on the coverage of its network.

All U.K. operators, including EE, have addressed the question of coverage in terms of population. In consequence, customers hear high percentage figures for coverage, but find them at odds with their experience of having poor or no network coverage for much of the time when they're on the move. The more people rely on mobile coverage, the more annoying and inconvenient it becomes when they don't have it. So we believe that shifting the focus from population coverage to geographic coverage, and targeting 95% geographic coverage by 2020, makes sense on several levels.

• It matches the trends that we see in demand and user behavior that will make "not-spots" in 4G coverage increasingly difficult for customers to tolerate during the next five years.

• It leverages EE's opportunity, as part of BT Group, to integrate its 4G network with BT's unmatched fixed-line network.

• It exploits the headstart in 4G rollout that EE enjoyed during 2012–2013 by raising the bar that the other U.K. mobile operators will have to reach before they can claim parity on coverage, thus extending the period during which EE's headline coverage figures will be higher than those of its competitors.

The U.K. telecoms market is in a state of flux at present. If the proposed 3/O2 merger is blocked, as seems likely, we believe that the Liberty Global group, which owns U.K. cable operator Virgin Media, will see another European opportunity to combine one of its cable operators with a mobile operator. Another potential scenario is that in order to pre-empt a Virgin Media/O2 merger, Vodafone might negotiate with Liberty Global to combine Virgin Media with Vodafone UK. Either way, BT/EE would find its tenure as the U.K.'s only nationwide fixed/mobile operator to be fairly short. So maintaining clear differentiation between itself and its competitors will be crucial for EE.

But by upping the ante in this way, EE is making some big promises, and fulfilling them will take a lot of money. EE's announcements contain no details about the levels of investment that 95% geographic coverage will entail, nor whether those investments will require either an increase in projected capex or cost-cutting elsewhere in the business. BT's Capital Markets Day is scheduled for May 5, and it's important that EE should use that opportunity to make a more detailed case to BT's investors for "4G everywhere."

For more information, please contact John Delaney, associate VP, Mobility, IDC, at

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International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. IDC helps IT professionals, business executives, and the investment community make fact-based decisions on technology purchases and business strategy. More than 1,100 IDC analysts provide global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries worldwide. For 50 years, IDC has provided strategic insights to help our clients achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. You can learn more about IDC by visiting

Companies Covered

EE Limited

Regions Covered

United Kingdom

Topics Covered

Air interface, Mobility

For more information, contact:

Mathew Heath
44 20 8987 7100

John Delaney
44 20 8987 7100