Lack of universal 4G could cost economy £120m over Christmas says eBay

Slow mobile connection speeds due to the lack of a universal 4G service will cost the economy £120m over the Christmas period, according to web retailer eBay, who believes current mobile download speeds will discourage consumers from using smartphones to buy products online.

The UK's first 4G service, provided by Everything Everywhere (EE), was launched yesterday, providing 11 cities with up to 12Mbit/s mobile connections.

EBay estimates that a third of Christmas gifts will be purchased through smartphones even without 4G, but argues the improved speeds and reliability of 4G would boost sales from £373m to £493m.

"Slow browsing speeds and breaking connections are now significant barriers to mobile commerce – and this comes at a high price," said Clare Gilmartin, vice-president of eBay Marketplaces Europe.

While the retailer welcomed the 4G spectrum auction being brought forward to early next year, after which network providers other than EE will be able to provide 4G services, Gilmartin argued that "for the UK economy the cost of another Christmas without universal 4G is huge".

"Consumers are increasingly demanding a better experience, regardless of their network. We hope that the government will work quickly come the New Year to ensure its promise to deliver 4G for all by the end of 2013 is realised," she added.

While EE is the only provider to offer a 4G service for now, Vodafone remains cool about its rival's head start in the market. The firm believes that the majority of consumers won't make the switch to 4G until the service has become far more established.