TeliaSonera launches 4G wireless network

TeliaSonera of Sweden on Monday launched the world’s first fourth-generation wireless service, as equipment vendors vie for a high-stakes contract to build the next stage of the network.

The service, initially limited to central parts of Stockholm and Oslo, will offer mobile broadband at up to 10 times the speed of third-generation technology and blaze a trail for other operators, such as Verizon of the US and Japan’s NTT DoCoMo, which are preparing to unveil 4G networks.

The Nordic launch will be the testing ground for a battle between equipment vendors to build the next generation of mobile networks, as TeliaSonera prepares to choose between Ericsson and Huawei to expand its fledgling 4G service across Sweden and Norway.

TeliaSonera split its initial 4G contract between the rival vendors – with Ericsson building the Stockholm network and Huawei taking responsibility for Oslo – making the pair frontrunners for a bigger contract expected to be awarded in January for the next stage of the rollout.

Huawei this year overtook Alcatel-Lucent, the Franco-American group, to become the world’s third-largest network equipment maker after Ericsson and Nokia Siemens Networks.

The Chinese company recently won a symbolically important contract to upgrade the domestic mobile network of Norway’s Telenor, signalling its ability to compete in the most advanced markets. Victory in the TeliaSonera contest in Ericsson’s home market would be an even bigger coup.

Kenneth Karlberg, the head of mobile services at TeliaSonera, told the Financial Times that the decision would be based solely on grounds of price and quality. “We already use Huawei in Finland so [nationality] is not an issue,” he said.

A dress rehearsal for the TeliaSonera deal could come this month, with Tele2, a smaller Swedish mobile operator, also close to awarding a contract to build its 4G network.

Harri Koponen, Tele2 chief executive, said there would be no local favouritism towards Ericsson. “We are in a very competitive situation in the [network equipment] marketplace today.”

TeliaSonera’s 4G service will initially be accessible only through personal computers because no 4G mobile phones have yet been launched. The service is based on the Long Term Evolution technology that looks set to become the dominant 4G standard.

●Tele2 on Monday paid SKr550m ($77.5m) for a controlling stake in NEO, Kazakhstan’s third-largest mobile operator. The Swedish company already operates in Russia but the Kazakh deal marks its first step into Central Asia, where its Nordic rivals, TeliaSonera and Telenor, have a strong presence.

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