Thursday, February 26, 2009

4G Wireless Broadband Wars This Year

Later this year, the battle for 4G domination will begin in earnest.

4G? Has 3G really finished deployment yet? Actually, 3G wireless networks are pretty well out there. The big players, AT&T, Verizon and Sprint, have upgraded most of their tower sites in populous areas. Many 3G smartphones and wireless modem aircards are available. While user awareness and adoption of 3G is still early on the learning curve, there's seemingly no time to waste for the carriers. It's on to 4G!

What's the big hurry? Part of it is an increasing sophistication in mobile applications with a corresponding increase in bandwidth demand. Some is good old fashioned competition. Think of it something like the space race or the building of the transcontinental railroad. The real value of these 4G networks is less about what's absolutely needed now and what they will enable in the future.

The 3G competition is based on two competing incompatible standards. The CDMA networks of Verizon, Alltel, and Sprint have developed EVDO technology. GSM networks, including AT&T, T-Mobile and foreign carriers have developed UMTS broadband, notably EDGE and HSPA.

The 4G competition is also dividing along two lines. First out of the gate is WiMAX, a worldwide standard for fixed and mobile broadband. But building steam is LTE, which is oddly enough being embraced by both Verizon and AT&T. Who's pushing WiMAX? Sprint and a fixed wireless player, Clearwire.

Is this going to be something like the ongoing DTV transition where one technology goes dark and the other immediately takes its place? No, not really. Both 3G and 4G will co-exist for a long time to come. WiMAX is being deployed in the 2.5 GHz band using the combined channel licenses owned by Sprint and Clearwire. Verizon and AT&T will use 700 MHz spectrum acquired in the recent telecom auction that was formerly the domain of analog TV broadcasting. That allows 3G cellular broadband to continue on the existing cellular bands as long as it makes economical sense.

One question is how much additional bandwidth we'll get from 4G wireless. During the run-up to the WiMAX standards approval, it was widely touted that a single WiMAX tower would have a range of something like 30 miles with bandwidth anywhere from 30 to 70 Mbps near the transmitter. In practice, Sprint was offering 2 to 4 Mbps download speeds on its Xohm service in Baltimore. The Xohm name has been retired, as Clearwire is taking over management of the combined Sprint and Clearwire channels. Clearwire has upped that to 4 to 6 Mbps on its Clear (tm) 4G wireless service for Portland, OR.

LTE hasn't been deployed yet, but peak data rates of 60 to 80 Mbps have been observed in tests. Verizon has suggested that average LTE data rates of around 8 Mbps are likely in actual service, although that may be conservative. Since there is a tradeoff between bandwidth, number of users per transmitter and distance from the tower, it seems likely that both LTE and WiMAX could be scaled up to provide speedier service as customer demand and the competitive environment dictate.

WiMAX has a lead in the race to the 4G wireless marketplace, with systems already in commercial service. Verizon's LTE has an advantage of frequencies lower in the electromagnetic spectrum, which should translate into greater ability to penetrate into buildings. Verizon expects to have 2 markets served by LTE by the end of this year. In 2010, Verizon expects to launch around 25 to 30 markets with LTE service. WiMAX will likely have a similar service level. There are now 50 markets in the U.S. and Europe with a pre-market version of WiMAX service.

4G wireless will likely reach a tipping point in 2011 or 2012, depending on the economy. Both mobile and fixed location services will be available, offering competition to DSL and Cable modem service as well as powering smartphones and netbooks. What will all this bandwidth be used for? You can bet that video will be the proverbial "killer-app", along with cloud computing and interactive everything.

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