As hordes of more smartphones, like Apple Inc. (Nasdaq: AAPL)'s iPhone 4, are poised to land on Telefónica UK Ltd. 's network, the mobile operator has beefed up network and signaling capacity in London with an upgrade from Nokia Networks . (See Operators Support iPhone 4 Worldwide and O2 Offers iPhone 4.)

O2, like AT&T Inc. (NYSE: T) in the US, has suffered from network congestion and capacity constraints due to a surge in mobile data traffic, much of which comes from smartphones. (See 02 Felt iPhone Crunch Too, What if Capacity Isn't AT&T's iPhone Problem?, and iPhone Troubles Might Go Beyond Signaling.)

Now, the operator has completed an upgrade to its mobile broadband network in central London that has resulted in "a better use of network resources, minimized traffic loss and enhanced the experience of smartphone users," says Nigel Purdy, head of technology at O2, in a press statement.

A key part of the upgrade was a capacity boost in the base stations, which O2 and Nokia Siemens did by doubling the number of sectors from three to six. But O2 has not specified exactly how much more capacity has been added as a result.

Most base stations are split into three sectors, each with its own antennas and power amplifier. By doubling the sectors to six, which involves adding new antennas and radio modules, operators can get a 50 percent to 60 percent increase in capacity from that base station.

Going to six sectors is a good way to go to increase capacity and it's a technique that is just starting to crop up in Europe, according to Heavy Reading analyst Gabriel Brown.

"Operators with only two 3G carriers, like O2 in central London, are starting to hit a capacity ceiling in high-traffic locations," says Brown. "By going to six-sector, they're making much more efficient use out of their spectrum."

And compared to a high-speed packet access plus (HSPA+) upgrade, which involves adding multiple input, multiple output (MIMO) antennas and would require compatible devices, a six-sector upgrade looks like a good option for 3G operators to increase capacity now.

"Six-sector requires about the same investment as MIMO for HSPA+, but delivers better efficiency and doesn't require advanced devices," says Brown.

Brown expects more operators to roll out six-sector base stations in the next couple of years.

Another part of O2's network improvement is an increase in signaling capacity, which will also help to preserve battery life on smartphones. In all, O2 claims its smartphone users in London now have "faster upload and download speeds, longer batter life and better coverage."

At the end of last year, O2 committed "hundreds of millions of pounds" to improve capacity on its network. The program involved adding 200 new sites in London alone.

— Michelle Donegan, European Editor, Light Reading Mobile