DALLAS – Regional operator MetroPCS Communications Inc. (PCS) surprised many recently when it became the first domestic carrier, and one of the first in the world, to launch a commercial LTE network. The carrier, which has made its name on operating efficiencies and flat-rate pricing plans, noted at today’s LTE North America 2010 event that LTE was almost tailor made to meet the carrier’s financial needs.

MetroPCS’ CTO Malcolm Lorang used his keynote address to tout the operational efficiencies baked into the LTE standard and repeatedly thanked those in attendance that had a hand in providing for those efficiencies. Lorang explained that without those efficiencies MetroPCS would not have been able to take advantage of the technology and would still be stuck without a true next-generation evolution plan to meet its spectrum and cost requirements.

As part of the efficiencies, Lorang noted that MetroPCS was able to reuse many of its current cell sites and other facilities when rolling out LTE. The carrier was also somewhat future-proofed when it decided to go with an all-IP backhaul solution several years ago that Lorang said was originally done as a way to cut out costs in the long term.

MetroPCS has so far launched LTE services in Las Vegas, Dallas, Detroit, Los Angeles and Philadelphia, and has relied heavily on the standard’s ability to deliver service using channels as small as 1.4 megahertz.

While 64% of Americans have broadband access, and the majority of Americans who don't have it say they don't want it, there is no one-size-fits-all approach to closing the gap in the digital divide, according to the federal government, which said it just completed the most comprehensive survey on the issue.

“Americans who lack broadband Internet access are cut off from many educational and employment opportunities," said Assistant Secretary for Communications and Information and NTIA Administrator Lawrence E. Strickling. "The learning from today's report is that there is no simple ‘one size fits all' solution to closing the digital divide. A combination of approaches makes sense, including targeted outreach programs to rural and minority populations emphasizing the benefits of broadband. NTIA's Broadband Technology Opportunities Program is helping to address this challenge, but we are hopeful today's report will be useful to the larger community working to close the gap."

The survey was conducted across 54,000 households by the U.S. Census Bureau and data compiled by the Department of Commerce's Economics and Statistics Administration and the National Telecommunications and Information Administration. While it was no surprise that higher incomes and education are closely associated with broadband access, those two areas were not sole factors, the survey found. Likewise, differences in socio-economic attributes did not explain the gap associated with race and ethnicity. (Broadband Internet adoption was higher among White households.) Urban residents were more likely to adopt broadband Internet than rural residents, and younger people were more likely to use home broadband Internet than older people. “Internet non-users reported lack of need or interest as their primary reason for not having broadband at home,” the government said. “This group accounted for two-thirds of those who don't have broadband at home. In contrast, households that did not use the Internet specifically at home but did use the Internet elsewhere ranked affordability as the primary deterrent to home broadband adoption. This group represented almost one-fourth of those who don't have broadband at home.”

The survey did not separate wireless broadband access or satellite broadband access, but included all forms, whether wired or wireless.

“One sector making enormous strides toward effectively bridging the digital divide, however, is wireless,” said Jonathan Spalter, chairman of the Mobile Future Coalition, a pro-market advocacy-based group formed in 2008. “According to the Pew Internet and American Life Project, African Americans and English-speaking Hispanics lead in both cell phone ownership and wireless Internet usage in the United States. In other words, when it comes to accessing the Internet from a mobile device, those often on the wrong side of the digital divide are actually leading the way. Clearly, much work remains to be done before we can declare victory in closing the digital divide but by continuing a light touch regulatory approach that promotes innovation, investment and competition, the road ahead is looking a lot more connected.”

Research In Motion Ltd. (RIM) saw its stock bounce up 4% on second-quarter results that included revenue up 31% from last year and earnings per share up 76% from a year ago.

Revenue for the second quarter, which ended Aug. 28, stood at $4.62 billion, up 9% from the previous quarter and 31% from $3.53 billion a year ago. Nearly 80% of the revenue came from devices. RIM said it shipped 12.1 million devices in the three-month period.

Going forward, co-CEO Jim Balsillie said he expects the momentum to continue. "We expect a continuation of this momentum in the third quarter as we extend the rollout of new products including the BlackBerry Torch into additional markets and benefit from heavy promotional activities and increasing customer demand as we head into the holiday buying season."

Net income for the quarter was $796.7 million, up 31% from a year ago and 3.6% quarter to quarter. The company said it expects to add between 5 million and 5.4 million net subscribers in the third quarter, with revenues of between $5.3 billion and $5.5 billion.

In a conference call, Balsillie said the company continues to work with foreign governments like United Arab Emirates and India to calm their security concerns.

Latin America and Asia were strong growth areas for RIM, as 52% of revenue was generated outside the United States. While the company saw lower-than-expected sales in the United States early in the quarter but the launch of the Torch in late August contributed to meaningful sales.

Torch is the most successful GSM BlackBerry sold in the United States, the company said. Sales in new markets during the holiday buying season should help RIM sales going forward.

Fresh off an announced acquisition of 450 tower assets yesterday, Global Tower Partners today said it closed on the purchase of Highpointe Group, a rooftop management and consulting business that was the largest site management company in Texas.

Highpointe’s portfolio included 2,422 new managed and master leased rooftop sites, including some along the eastern seaboard.

"The addition of Highpointe to the GTP family solidifies our position as a leading developer and manager of wireless antenna facilities on structures and rooftops throughout the United States," said

Marc C. Ganzi, CEO of Global Tower Partners. “The Highpointe acquisition will also supplement our presence in New York City, Texas, the Southeast and Mid‐Atlantic, where many of these strategic rooftop properties are located.”

Terms of the sale were not disclosed. The acquisition brings GTP’s portfolio to more than 13,000 owned, leased or managed sites, including 3,800 towers.

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Mobile broadband gateway developer Stoke Inc. said it deployed its 100th mobile gateway earlier this week, less than two years after shipping its first commercial system. The company expects to deliver its 200th system by the end of the year, said President and CEO Vikash Varma.

“We've experienced hock-stick growth, which we're proud of because the components market has been tight. We can't tie up too much cash so we need to be as close as possible to just-in-time with inventory,” Varma added.

The company offers a Stoke Session Exchange gateway, first deploying the solution with NTT DoCoMo in Japan for a femtocell solution, and in January, winning an LTE contract with DoCoMo. Indeed, DoCoMo has invested in the company, which recently completed $25 million in series D funding round. Noted venture-capitalist firms Kleiner, Perkins Caulfield and Byers and Sequoia Capital also have invested in Stoke. Varma said that the last time those two VCs invested in the same company the investment was in Google Inc. Indian operator Reliance Communications also has invested in the company after deploying its solution.

ABI is predicting a 100-fold increase in data traffic by 2015, Varma said. Wireless networks are struggling to meet today's data demands and the expected future data explosion because 3G networks simply were not designed to handle all that traffic. “It doesn't matter how efficient Facebook video chat is if 500 million Facebook friends are video chatting at the same time. This is what is driving the mobile broadband network,” Varma said.

Network systems designed 10 years ago were built for a “nicer time” when operators were able to better predict traffic on the network. Going forward, operators face won't necessarily be able to predict what application or device will drive traffic. “Apple and Android have up-ended the market.”

Because of that, operators are trying to respond to dramatic growth with usage-based billing models but that likely won't work until end users understand what a gigabyte means. Instead, operators need to optimize the network by offloading traffic from the mobile core, Varma said. Stoke's solutions address key areas of the network, offloading data with Wi-Fi, femtocells, LTE network gateways and non-intrusive Iu-PS breakout. The gateway solution also provides seamless transition between 3G, LTE and Wi-Fi technologies. “Our approach is different because we have no legacy product that we have to build from. It helps businesses cross over from the limitations from how they've done things years ago.”

The gateway product sits between the Radio Access Network (RAN) and the core network, diverting the session to the nearest Internet Protocol point. Varma said the Stoke Session Exchange solution addresses the problem “surgically,” noting that AT&T Mobility's network congestion occurs on the West and East coasts, so the operator only needs to address the problem in those regions, not nationwide.

More from RCR Wireless News.

Editor's Note: This article is an excerpt from RCR Wireless News' May Special Edition, ''Enabling the Mobile Revolution: Mobile Chips, Devices and Accessories.'' The 80-page special edition is available here.

There is not a more vexing problem for the wireless industry than the plight of rural operators.

On one hand rural operators are essential in that they provide services to a large portion of the nation that larger operators have overlooked, and they also offer network roaming capabilities for just about all of the industry's largest operators. On the other, rural carriers have very different operational structures from their larger brethren and thus are often at odds with the nationwide carriers when it comes to regulatory and competitive concerns.

To the surprise of few, rural wireless operators continue to face a number of challenges in their collective daily quest to remain viable options for consumers increasingly bombarded with advertising and promotions from nationwide operators--operators that spend billions of dollars on marketing each year and, in the case of the nation's two largest operators, are dominating the market.

This has often resulted in a ''big vs. small'' dynamic among wireless carriers that has prevented a cohesive front to regulators.

Battling big brothers

At this year's Rural Cellular Association event, a number of speakers representing smaller carriers noted during a panel discussion that the wireless industry was dominated by two operators that were increasingly driving the industry to a duopoly.

''It's not inevitable, but it's heading that way,'' said recently named RCA President and CEO Steven Berry during a panel session entitled, ''Wireless at a crossroads.''

Berry noted that 90% of all new postpaid customer growth in 2009, or roughly 9 million customers, were signed up by either Verizon Wireless or AT&T Mobility. And that even the smallest of the nationwide operators, T-Mobile USA Inc., was more than five times larger than the largest member - U.S. Cellular Corp. - of RCA.

Beyond the pressure being applied by rival operators, Berry noted rural wireless carriers were also at a policy crossroads.

''Decisions are being made now that will determine whether we are allowed to compete fairly or that will put us at a disadvantage,'' Berry warned.

Those decisions include voice and data roaming, of which RCA gained a victory on earlier this year when the Federal Communications Commission cut home-roaming exclusions; spectrum interoperability surrounding the 700 MHz band, details of the National Broadband Plan and Universal Service Fund reform.

''If any of these decisions go into AT&T's or Verizon's favor it could put us all in danger,'' warned Slayton Stewart, outgoing chairman of RCA and CEO of Carolina West Wireless.

USF making way for NBP

One topic that has garnered strong opinions from both sides of the battle is USF reform. Smaller carriers claim these funds are necessary for them to be able to continue to provide services in areas that cannot justify investments, while opponents think the fund is a way for larger carriers to subsidize their smaller competitors. The FCC has long sought ways to reform the current system and with its latest proposal in the National Broadband Plan is asking that traditional USF funds be diverted to operators, regardless of size, that will build out wireless broadband networks.

Berry noted that the recently announced National Broadband Plan basically will eliminate USF support to rural wireless carriers, but that the Connect America plan in its place is still lacking details.

''The NBP falls short for regional carriers,'' Berry said. ''I am very disappointed in it. It creates new non-facilities-based competitors for regional carriers.''

Smith noted that while USF may need some reform, the premise of the program is still needed for rural wireless carriers looking to offer service.

''USF has been about providing telecom capabilities no matter where you are in the U.S.,'' said Smith. ''I am still trying to build out wireless voice in some areas. There are still places without basic wireless service.''

This lack of actual customers to serve is highlighted by Hays, Kansas-based Nex-Tech Wireless, which operates a CDMA-based network covering portions of western Kansas and eastern Colorado. The carrier said its network covers around 190,000 potential customers spread accross 30 counties.

''Much of our coverage area has more coyotes and potatoes than people,'' noted Johnie Johnson, CEO of Nex-Tech Wireless.

Johnson said that Nex-Tech was still reeling from 2008 cuts in USF funding and that it has seen around $20 million in lost funding that had been set aside to increase coverage in Kansas.

''It would be very difficult to operate as a business without the USF funds,'' Johnson said. ''Without those funds our network would likely be just like our competitors, covering just the interstates and highly traveled state roads.''

Roaming potential

Another issue concerning rural carriers is roaming, whether it's the increasing loss of voice traffic as larger carriers expand their coverage or their own access to data roaming agreements that they say larger carriers are reluctant to provide.

''Data roaming is every bit as important as voice roaming,'' said Carolina West Wireless' Stewart. ''We have seen a huge increase in data traffic. If we are not able to offer the latest and greatest handsets and the same size of a network, which is nationwide, it's difficult to compete. It's hard for consumers to stick with us.''

RCA incoming chairman Ron Smith, who is also president at Bluegrass Cellular Inc., added that the recent FCC decision on home-market exclusion adds the presumption that there should be roaming, but that until it spells out that data roaming being included, plans for national broadband coverage will suffer.

''The FCC has to realize it's still an issue out there,'' Smith said.

Industry observers agreed that roaming is still a significant issue for smaller operators, but added that they do have some power in the segment. ''Roaming is still critical for the big 4,'' said Amit Patel, CTO for Alcatel-Lucent's U.S. strategic wireless accounts. ''But, the big carriers are not looking to create roaming agreements. … T-Mobile might be more motivated, but AT&T is not.''

Patel noted that AT&T Mobility's recently reported first-quarter financial results showed continued strong customer growth for the carrier despite a strong marketing push by rival Verizon Wireless touting the lack of reach of AT&T Mobility's network.

''Those December ads against AT&T did not drive AT&T to want to fill out its map,'' Patel said.

However, AT&T Mobility's LTE plans could spell a different story. Patel noted that the carrier's 700 MHz spectrum assets are not as wide-ranging as those held by Verizon Wireless, which could lead to opportunities for rural carriers with 700 MHz spectrum in areas where AT&T Mobility is lacking.

Another potential for rural carriers is investment firm Harbinger Capital Partners, which recently closed on its acquisition of SkyTerra Communications Inc. The $1.8 billion deal includes stipulations that Harbinger use the 30 megahertz of spectrum it acquired in the deal to build out a nationwide cellular network to supplement the satellite-based services being offered by SkyTerra.

Patel noted that Harbinger will be required to cover 100 million potential customers within three years and 190 million pops within five years, and that rural wireless carriers could be good partners for the buildout. Harbinger has reportedly decided to use LTE technology for its network, and, according to media reports, has recently begun talks with T-Mobile USA Inc. as a potential customer on the network.

''Harbinger is looking at a lot of different business models,'' Patel added.

700 MHz details still up for debate

There is also increasing concern amongst RCA members that the FCC will not take a solid stand on 700 MHz spectrum interoperability, which would require carriers and device makers to make their networks and equipment compatible with the different spectrum positions in the band. This concern arose from device and equipment requirements from Verizon Wireless that included support for only its band 13 and from AT&T Mobility for its band 17 in the 700 MHz band.

This issue was originally handled by the FCC in the PCS auctions with requirements that equipment and standards for the spectrum being auctioned be interoperable with all the spectrum auctioned in the 1.9 GHz band. For the 700 MHz auction, the FCC did not mandate such interoperability.

''If you auction spectrum in good faith and allow after the plan for band plans to be developed, how do you plan for that?'' Bluegrass Cellular's Smith asked rhetorically.

Berry also noted this could be an issue for public-safety, which is set to receive spectrum in band 14 in the 700 MHz band. Without interoperability requirements, public-safety equipment might not be able to operate on other networks in the 700 MHz band.

Device access

Handset exclusivity issues is also a topic rural wireless carriers have been battling. Smaller operators have been pushing the FCC on the issue, saying that if they are not allowed to offer compelling devices to their subscribers, they will not be able to stay competitive.

''We try to differentiate ourselves with coverage and better customer service and have been pretty successful,'' noted Stewart. ''But, when you don't have access to the latest stuff, customers won't stay with you in the marketplace. Customers are choosing carriers that provide good local service, but if we don't have the latest offering, it's hard to compete. People are willing to stay with us if we are competitive.''

Smith noted that rural wireless carriers were having some success in negotiating access to some devices, but that more needed to be done.

''We've historically had exclusivity in the wireless industry, but in the past it has typically been short-lived,'' Smith said. ''In some cases that has now gone to lifetime or takes it out through the lifetime of the device. On the CDMA side, we have the Associate Carrier Group that has been very successful in getting devices, but it's not the ultimate solution. There is still an issue with 46 of the top selling handsets having some sort of exclusivity tied to them.''

Local still matters

Despite the increased competitive pressure from nationwide operators, panel members in general indicated that smaller wireless operators still had an advantage in being able to ''localize'' themselves with their customer base, an advantage they were urged to continue to take advantage of.

''The strength of rural carriers is that they are involved in their community,'' said Huawei's Jagernauth.

Alcatel-Lucent's Patel added that the involvement should include customization options that take advantage both of technology changes as well as local knowledge.

''Make your customization geared toward your customer base,'' Patel explained. ''Tie in local events with local community groups.''

More news from RCR Wireless.

Verizon Wireless said it has completed the purchase of former Centennial Communications Corp. assets from AT&T Mobility covering portions of Louisiana and Mississippi.

The $235 million purchase included Centennial’s spectrum licenses, network assets and more than 117,000 current customers in six service areas, including: Lafayette, Beauregard, Iberville and West Feliciana, La.; and Claiborne and Copiah, Miss. The additional customers helps bolster’s Verizon Wireless’ position as the nation’s largest wireless operator, though a recent report said that the position will be AT&T Mobility’s within a year.

Verizon Wireless said that beginning today it will begin serving customers in those markets, but will continue with the Centennial brand for the next several months as it begins to convert the network assets to the carrier’s CDMA-based technology. Both Verizon Wireless and AT&T Mobility have become quite adept at network integrations as they have spent the past several years gobbling up a number of regional operators.

AT&T Mobility was required to divest the markets as a requirement to receiving approval of the Centennial acquisition that was announced in late 2008.

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Looking to keep its foot to the floor, LightSquared said it has delivered a notice to satellite communications provider Inmarsat plc (IMASF.PK) triggering “Phase 1” of their agreement that calls for Inmarsat to begin re-banding its L-Band spectrum covering North America.

The plan, which LightSquared said could take up to 18 months, also calls for Lightsquared to make payments totaling $337.5 million to Inmarsat over the duration of the transition. The plan was part of an agreement signed in late 2007 by Inmarsat and LightSquared's predecessor companies SkyTerra Communications Inc. and Mobile Satellite Ventures L.P. Both companies were eventually acquired by Harbinger Capital Partners.

Once completed, the re-banding will provide LightSquared with spectrum it plans to use to begin building out a terrestrial/satellite hybrid network.

“Triggering this agreement will now give us the contiguous spectrum we need to support additional network capacity to meet the growing demand for wireless data,” said Sanjiv Ahuja, chairman and CEO of LightSquared.

The company last month announced a $7 billion agreement with Nokia Siemens Networks to begin building out the LTE-based terrestrial network that will include more than 40,000 base stations and cover 92% of the U.S. population by 2015. LightSquared said it plans to wholesale access to the network.

LightSquared added that it also has the right to initiate “Phase 2” of the agreement anytime through Jan. 1, 2013, which will provide it with additional spectrum at an annual cost of $115 million. If exercised Phase 2 is expected to take up to 30 months to complete.

Inmarsat recently unveiled its first mobile satellite handset to round out its portable device offerings.

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The Federal Communications Commission is being flooded with comments regarding its Further Notice of Proposed RuleMaking on plans to change rules around utility pole attachments, which among other things tries to bring the cost for telecommunications service providers to attach equipment to utility poles more in line with the costs cable providers pay.

Although the order impacts wired telecom and cable operators, wireless service providers deploying Distributed Antenna System (DAS) networks would also benefit from the new rules proposed by the FCC. As such, The DAS Forum, CTIA, NextG Networks, T-Mobile USA Inc. and other wireless industry players commented on the need for new rules. Not surprisingly, utility companies that submitted comments are generally unhappy with the proposal.

The FCC is proposing new rules for utility pole attachments as part of its National Broadband Plan, designed to bring Internet access across America, especially in rural areas. Specifically, the agency is trying to address disparity in prices utility companies charge pole attachers; timelines during the attachment process; and ways to resolve disputes in a timely manner.

The DAS Forum, a group within PCIA, proposed a 90-day timeframe for utility companies that do not have a standard for wireless pole attachments to work with wireless companies to establish a standard.

The Forum also addressed cost disparities. “The commission must affirm that wireless attachers are subject to the telecom rate and not monopoly rates. DAS Forum members report a wide disparity in the rate charged for wireless attachments, ranging from tens-of-dollars to over a thousand dollars per year. There is no justification for a utility to charge these illegal rates that are significantly above the regulated rate for wireless attachments. While a wireless attachment may occupy more space than a wired attachment, and therefore proposes that the wireless attachment rate should be equal to the telecom rate times that amount of usable space occupied above one foot.”

TW Telecom and Comptel, which represents competitive local access communications providers (CLECs) , said the FCC needs to be able to fine utility companies that do not comply with the new rules. “To begin with, the record shows that utilities continue to insist on including in pole attachment agreements provisions that have been deemed unlawful by the FCC, and utilities often engage in other conduct that has been deemed unlawful by the FCC. The utilities apparently believe that they have little to lose by ignoring FCC decisions.”

In a 110-page filing, The Alliance for Fair Pole Attachment Rules – a coalition of large utility companies including Duke Energy Corp. and Southern Co. – said the FCC's proposed rules do the opposite of the intended purpose. “In stark contrast to the Alliance's recommendations, the FNRPM does precisely the opposite of what the Commission's own findings warrant: it focuses almost exclusively on pole owners, without distinguishing between electric utilities (who have only the best interests of their own ‘infrastructure at heart') and ILECs (who ‘can make no such claim.') "

A group of utility companies calling itself the Coalition of Concerned Utilities said the FCC's proposed rules do not take into account the safety of its workers or the true cost to the utility when allowing attachments to their poles. “For decades, communications companies have attached their facilities to tens of millions of utility poles across the country without incurring the substantial cost and inconvenience of constructing and maintaining their own distribution systems. In return for making their internal distribution systems available to attachers, utilities have been ‘rewarded' with unfair and discriminatory pole attachment rates, countless unauthorized attachments, myriad safety violations and innumerable administrative burdens. Electric utilities should not be required as a matter of public policy to jeopardize the safety and reliability of their systems or to subsidize the deployment of broadband or other services for the benefit of third party communications companies under any conditions, much less ones that would have little practical benefit. Even if they made sense from practical and policy perspectives, most of the Commission's proposals exceed its statutory authority.”

The Public Utilities Commission of Ohio suggested the FCC adopt a plan similar to its in which disputes must be addressed in a hearing within 30 days and a ruling must be issued 30 days after the hearing.

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Looking to venture successfully where others have struggled, Harbinger Capital Partners’ Lightsquared venture has many in the industry scratching their head. This has not deterred the Lightsquared squad in the least as the company appears very confident in its chances to compete in a highly competitive market.

The biggest question about Lightsquared’s plan is whether there is a market for the carrier’s planned wholesale data network. Previous attempts at constructing such networks have failed to generate sustainable business models either due to an inability to attract and keep wholesale partners that can generate enough traffic and revenue as well as companies that quickly balked at the costs needed to construct and operate a mobile network.

Having already announced its ambitious build out plans, the company appears undaunted by the challenges.

“We are wholesale only,” explained Frank Boulben, Lightsquared’s chief marketing officer in an interview with RCR Wireless News. “Each dollar we raise will go back into our network. No money is going into marketing or call centers. Our business will be very lean.”

Lightsquared thinks this leanness will allow the company to succeed in a market where others have failed.

“The U.S. is an exception in the developed world,” Boulben explained. “In other parts of the world you have very vibrant MVNO and wholesale models. The primary reason it has not worked in the U.S. is due to wholesale economics. We are developing the next generation of technology on a greenfield build so we have the best economics, we have broad coverage, very high level service quality, low cost because we will benefit from 4G LTE advantageous spectrum position and a contract with NSN that was won through a competitive bidding process.”

Boulben added that the wholesale-only model is important as it frees any potential conflict with customers, a conflict Lightsquared said it has heard from companies is one of the reasons they have yet to attempt to enter the mobile space.

“We are only successful if our partners are successful,” Boulben said. “Our business plan is built on market share, and with our cost structure we don’t need a lot of market share to be successful.”

The wholesale only mantra is counter to how Clearwire Corp. is running its network as the carrier offers both a branded offering as well as an avenue for others to offer mobile services. Clearwire, which is also looking to attract wholesale customers to its current WiMAX-based network, noted during its recent second quarter conference call that while direct customers that have signed up for its “Clear”-branded service make up just over half of its 1.7 million strong customer base, those customers constitute a vast majority of its service revenues. This is due to the fact that each direct customer generates more than $40 per month in service revenue, while it only receives a portion of the revenue from customers through its wholesale partners.

But, by having to support its direct customer base, Clearwire is forced to invest in marketing and customer support that Lightsquared is looking to avoid. Clearwire has hinted that at some point it would like to reduce the prominence of its branded offering in favor of a greater reliance on its wholesale partners.

In addition to staying out of the retail fray, Lightsquared also said it will allow its customers to deploy their own voice offering using its data network.

“Our network will be completely net neutral,” Boulben explained. “If a customer wants to run a peer-to-peer VoIP application or streaming video they will be free to do that. We will just charge on a price per megabyte basis. … Voice will just be a data application.”

Boulben added that this will allow customers to provide their own voice offering, but that it would also step in to provide a white label service for those that ask.

Capacity not a concern

Lightsquared is also confident that its spectrum position and that its choice of spectrum and technology will be a benefit in the current mobile climate.

“We have more spectrum than the other two LTE providers and we are starting from a market share that is zero,” Boulben said. “It’s highly unlikely that we will have any spectrum concerns with our market share perspectives. We think we would need more than double our market share expectations to have any concerns about spectrum.”

Lightsquared said it feels fortunate to be launching services at this time as the backhaul market is exploding with new fiber capabilities that are tailored made for high-speed data networks. The company expects more than 60% of its estimated 40,000 cell sites to have fiber backhaul.

Lightsquared also noted that unlike previous attempts to build out such wholesale networks, the expected capacity crunch forecast by many due to increased mobile data usage means the timing is right for bringing more capacity to the market.

“We can help satisfy that demand,” Boulben said. “Other operators will not have that capacity in the next five years.”

Satellite part two

While satellite communication services have had a rocky history in trying to compete with traditional land-based cellular systems, Lightsquared sees its ability to tap into that option as an early benefit.

“We think the satellite component provides us with a number of advantages,” noted Boulben. “First is that from day 1 we will be offering 100% population coverage of the continental United States. Anywhere you can see the sky you can make a call or send a text.”

Boulben also said that the satellite feature will provide a boost for rural coverage, an issue that still plagues land-based services.

Boulben explained that while the carrier is high on the benefits of the satellite services ability to bolster its traditional cellular network, Lightsquared will be leaving it up to its customers as to whether they want to integrate satellite into their service offerings.

“It’s very important to realize that we are in the wholesale business only,” Boulben said. “It’s up to our partners as to what they want to offer. If they just want land-based services, we will offer them that.”

Roaming needs

Despite the broad coverage made possible by satellites, Lightsquared realizes that it will have to rely initially on roaming agreements with traditional cellular operators to bolster its cellular coverage to a depth that customers have accustomed to. The company said it was in discussions on reciprocal roaming agreements that it expects to close in the next six to nine months and that those deals could involve both 4G and for the short term 3G coverage. Boulben hinted that the 3G deals would likely be for HSPA+ services.

Device conundrum

Another topic analysts have expressed concerns about is Lightsquared’s ability to convince equipment makers to produce devices and chipsets compatible with the carrier’s unique network requirements. To gain full access to Lightsquared’s network assets a device would have to provide support for satellite communications and LTE technology using the carrier’s 2 GHz spectrum as well as any technology or spectrum needed to access roaming services.

Satellite communications provider TerreStar Networks Inc. has begun offering a dual-mode cellular/satellite smart phone through a partnership with AT&T Mobility that can access either the company’s satellites or AT&T Mobility’s GSM/GPRS/EDGE/HSPA network.

Analysts have noted that Lightsquared’s success could ride on its ability to begin seeding the device ecosystem to attract potential customers.

“This will be a big challenge for Lightsquared,” said Larry Swasey, co-founder of Visant Stategies. “It will be a chicken-and-egg scenario. They have to be able to show to customers that device makers are indeed willing to make devices to meet the network needs before they will sign on. And device makers are only going to be interested in making these devices is they can be guaranteed scale in the millions of units.”

Lightsquared appears set for that challenge noting that it has contracted with three handset vendors to produce devices and is close to signing up two more.

“We plan to announce these in the fall,” Boulben said. “The initial devices will be data centric; data cards, netbooks, embedded modules, personal hot spots and wireless routers. Later we will announce smart phones.”

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Alcatel Lucent (ALU) posted a second-quarter loss but reaffirmed its full-year outlook with nominal growth of between 0% and 5%, despite continued component shortages. Like its competitor Ericsson, (ERIC) Alcatel Lucent revenues were buoyed by wireless development in North America. A-Lu and Ericsson are primary network providers for both Verizon Wireless and AT&T Mobility as they build out LTE networks.

Q2 revenue increased more than 17% sequentially to $4.9 billion, but was down more than 2% from the same period one year ago, but the network firm reported a loss of $240 million. “Networks saw a year-over-year single-digit decline in revenue, driven by fixed access, switching and optics. This has been partially offset by continued strong growth in IP and W-CDMA,” according to the company.

I am pleased with the continuing progress in our transformation journey, illustrated in the second quarter both by the top line and profitability. Revenues for the quarter reflect the on-going and expected overall improvement in market conditions and the good traction of our product portfolio. This is notably highlighted by the good performance in IP and wireless and, from a geographic standpoint, by strong growth in North America,” said CEO Ben Verwaayen.

The company’s wireless division revenues saw a 5% increase from a year ago, driven by its W-CDMA business. “Our W-CDMA business was the key driver of that increase with another quarter of near 50% year-over-year growth driven primarily by the North American market. A very strong sequential increase in our CDMA business reflected spending to accommodate data traffic growth on 3G CDMA (EV-DO) networks, and the year-over-year decline in our GSM business eased to a single digit rate.” Its applications business saw a 5.8% increase in revenue, while its services business saw a 1.1% increase in revenue. However, declining revenues in its wireline business contributed to the quarterly loss.

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Most people don’t give too much thought to the tiny components which form such an integral part of almost all modern communication devices, from PCs to mobile phones.

Indeed, mobile chips get almost no public recognition in a world which seems to care more about screen size, shiny aluminum casings and apps – yet without powerful application processors, our handsets and devices would be nothing more than bricks.

Making chips, however, is no easy task, nor is it a cheap one, resulting in many firms choosing to outsource their manufacturing to dedicated “fabs” to feed the almost insatiable modern appetite for smaller, faster processors.

In Singapore recently, RCR was privileged to be able to get a glimpse behind the chipmaking curtain at GlobalFoundries’ fab 7, where wafer upon wafer of chips are churned out daily from within the impressive maze of cleanrooms.

GlobalFoundries’ expertise is in producing very small, very power efficient chips based on the ARM architecture and   Fab 7 manufactures mobile products for many of the world’s largest wireless chip companies including Qualcomm, Broadom, Atheros and many others.

Getting a grand tour of the facility, VP of Fab 7 Peter Benyon explained the magic behind the process as well as the inherent paradoxes of balancing the need for increased performance with lower power and heat, larger die sizes at lower costs and how increased complexity can have a negative impact on wafer yields.

The process of making a wafer can take two to three months and involves a number of steps including film deposition (Oxidation, DCVD & PVD), chemical mechanical polishing (CMP), photolithography, etching, cleaning technology, implantation and diffusion.  Each of these is a process in and of itself, and can be repeated several times in fixed order.

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Editor's Note: This article is an excerpt from RCR Wireless News' May Special Edition, "Enabling the Mobile Revolution: Mobile Chips, Devices and Accessories." The 80-page special edition is available here.

WiMAX operators around the world are facing a dilemma – do they consider themselves to be alternative broadband providers like Clearwire Corp., which touts itself as a DSL replacement that is cheaper and portable, or do they take a more traditional approach like Sprint Nextel Corp., which is selling a 3G/4G handset combination that runs at faster speeds where it has network coverage, and drops down to carrier's CDMA system in places where WiMAX coverage is still being deployed. For Sprint Nextel and Clearwire, perhaps, the go-to market strategies are simple: Clearwire has been building its network without handsets (yet) because it doesn't have a traditional wireless network to drop down to, and Sprint Nextel does. But the decisions aren't so simple for other WiMAX providers around the world.

Vividwireless is an Australian-based WiMAX operator that just deployed service in Perth in March. The operator has only been commercial for a few weeks but already said it has been surprised by how many of its customers – half – are buying its services as for broadband replacement. It has also been surprised at how many of its customers are buying the home gateway product, geared to customers who plan to use the service primarily in the home. Further, 25% of its customers who buy the home gateway product are buying a VoIP plan offered by a sister company of vividwireless – even though the operator hasn't spent a penny on advertising its VoIP service. Vividwireless CEO Martin Mercer said the operator is billing itself as a DSL replacement, touting the simplicity of its wireless offering. As such, vivid is debating whether to offer handset-like devices on its network once they become available. The operator doesn't want to compete head on with cellular operators, pointing out that once you give someone a handset, the user expects coverage and abilities that work like they do on a handset.

For its part, Clearwire plans to introduce two 3G/4G handsets this year. How the carrier markets the devices will be interesting to watch. Sprint Nextel touts cost advantages, quality customer service with a no-questions-asked return policy and its Simply Everything plans for its cellular network. The carrier's ad campaign for its 4G service centers around the experiences that can take place on a 4G network, whether it is connecting gaming systems in the woods or downloading a movie from the airport. Price isn't mentioned. As Sprint Nextel introduces the HTC Evo 4G device, it will have to balance the cool things the device can do with more traditional handset advertising, like showing its sleek design and large-screen display.

In the LTE space, both Verizon Wireless and AT&T Mobility likely initially will sell data cards and dongles, and offer dual-mode handsets later. In such a competitive marketplace, Clearwire may find it's easier to differentiate as an alternative broadband provider, and put less emphasis on its handset offerings.

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Editor's Note: This article is an excerpt from RCR Wireless News' May Special Edition, "Enabling the Mobile Revolution: Mobile Chips, Devices and Accessories." The 80-page special edition is available here.

If I have uncovered anything while putting together this issue it is that mobile devices remain the predominate driver of the mobile industry. Sure, new technologies and aggressive rate plans are key components, but it looks to me that we are now at a stage where from a consumer point of view, any decision related to purchasing of mobile services has come down to which device do people want.

And I think this is a good thing. The wireless industry has never done a good job selling consumers on technology. Whether it was the move from analog to digital or from 2G to 3G, consumers were never going to make the switch just because some engineer with a pocket protector full of pens used charts and graphs to tout the advancements of new technology.

This also applies to network coverage, as for the most part every carrier has basically the same coverage, give or take a few million pops. And even in those markets blanketed with a carrier's network coverage color of choice, I think most people know that those coverage maps need to be taken with a grain of salt.

In the same way, while rate plans were indeed a big driver for the increased adoption of mobile service during the first 20 or so years of the industry, we have come to a point where for the most part carriers are all offering basically the same price for the same plans, give or take a few bucks. There has definitely been some more aggressive moves recently in the no-contract space, but even that has almost flattened around a few key price points.

So that leaves the mobile device as the true differentiator in the market and really the only selling point most carriers can lean on.

AT&T Mobility has shown by hooking its wagon to Apple that it can continue to drive customer growth despite “cough, cough” questions “cough, cough” about its network coverage caused by those same devices.

Verizon Wireless, which has been the most successful carrier in touting its network advantages, is throwing its considerable weight behind Google Inc.'s Android operating system, using devices powered by the OS on its marketing front against the AT&T Mobility/Apple juggernaut.

Sprint Nextel, after a failed attempt to revive its lagging sales to Palm's WebOS train, has along with T-Mobile USA also latched onto the Android express in their attempts to staunch the flow of customers to their bigger rivals.

This reliance also has carriers pushing harder for exclusivity deals that have customers confused (why can't I get an iPhone from Verizon?) and smaller carriers fuming (why can't we get any of the hottest smartphones?).

All of this should portend to new opportunities for handset makers looking to garner more control of their products in a U.S. market that remains dominated by carriers. Hit the right combination of form factor, user interface and feature set that attracts the eyes of consumers and carriers will be sure to come knocking.

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Verizon Wireless (VZ) posted second quarter results that showed that while the industry’s largest carrier fell just short of the customer growth reported by rival AT&T Mobility (T), the operator did manage to add more direct customers willing to sign a contract, often viewed as the most valuable in the industry.

Verizon Wireless said it added 1.351 million customers during the quarter, which was an 18.3% jump from what it added during the same quarter of 2009, but short of the 1.562 million AT&T Mobility said it added. Verizon Wireless did note that it added 665,000 direct postpaid customers, which was well ahead of the 496,000 contract customers AT&T Mobility attracted during the quarter. A loss of direct prepaid customers during the quarter cut Verizon Wireless’ total direct customer growth to just 454,000 subscribers during the quarter.

As in previous quarters, a majority of new activations on its network were through third-party channels with Verizon Wireless reporting 896,000 customer additions through its partners. The carrier also subtracted 2.1 customers from its network during the quarter due to divestitures that resulted in a drop in total customers from 92.8 million at the end of the first quarter to 92.1 million at the mid-point of the year. The results kept Verizon Wireless about 2 million customers larger than AT&T Mobility.

Verizon Wireless also said that it added 264,000 “other connections” to its network during the quarter, including e-book readers, machine-to-machine devices and telematics devices propping up that segment to 7.7 million total connections on its network.

Customer churn dropped year-over-year from 1.37% to 1.27%, which the carrier said was its lowest in 2 years. Average revenue per user from direct customers increased nearly 1% year-over-year to $51.56 during the quarter with data services accounting for $17.85 of that total.

Wireless service revenues increased just over 5% from $13.349 billion during the second quarter of 2009 to $14.046 billion this year, with total wireless revenues up 3.4% to $16 billion for the quarter. Wireless expenses increased just 1.6% year-over-year, which pushed operating income up 8.6% to $4.842 billion.

Verizon Wireless also reported that capital expenditures surged 21% year-over-year during the quarter to $2.262 billion and that wireless capex spending topped $4 billion for the first half of the year. The carrier is in the process of building out its LTE network with plans to cover 100 million potential customers by the end of the year.

Overall, Verizon Wireless’ parent company Verizon Communications Inc. posted mixed results as flat year-over-year revenues combined with a $2.3 billion charge associated with workforce reductions resulted in the company posting loss of 7 cents per share for the quarter compared with a return of 52 cents per share in 2009. Despite the drop, Verizon’s stock was trading up more than 4% early Friday at $28.14 per share.

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Nokia Siemens Networks should be able to increase its presence in the United States and Japan with the announced acquisition of Motorola Inc.'s networks business. The $1.2 billion acquisition was hinted at last week. Motorola will retain its iDEN networks business.

Nokia Siemens will pick up Motorola's CDMA, GSM, wideband CDMA and LTE business, which counted sales of about $3.3 million in 2009. ”We like to think we are buying at least part of the history of innovation at Motorola,” said Rajeev Suri, CEO of NSN. “First and foremost, this deal is about customers,” Suri noted. “We expect to gain an incumbent position with many of our customers. … Second the deal is about scale and building our presence in some regions.” Suri noted that the merger will move NSN from the No. 5 in North America to No. 3, as well as strengthen its position in Japan, including a contract with KDDI Corp. Motorola also counts contracts with Verizon Wireless and Clearwire Corp., among others.

About 7,500 Motorola employees will move over to NSN, and NSN will retain its presence in Illinois, where about 1,600 employees reside, Suri said. No layoffs are anticipated. The acquisition is expected to close at the end of this year. NSN will finance the purchase with its internal cash reserves and existing third-party financing solutions. “It's a beautiful addition to our customer portfolio.”

Motorola Solutions will keep its iDEN business, which counted $400 million in sales in 2009, as well as its enterprise, government and public-safety business. Motorola Co-CEO Greg Brown said the sale will enable the Solutions business to be a pure-play company. Indeed, Motorola's Enterprise Mobility Solutions business is predicting a compounded annual growth rate between 5% and 8% over the next few years, with opportunities to sell equipment and services into public-safety and vertical market enterprises.

A handful of CDMA patents will go to NSN under the deal, but Motorola will retain most of the intellectual property rights. NSN will be able to cross-license that IPR without paying for the IPR.

Amid speculation last week, Daryl Schoolar, principal analyst, wireless infrastructure, at Current Analysis, said a link-up between Motorola and NSN would be a great way for NSN to get a better toehold in the North American market. It's no secret that NSN wants a stronger North American presence, having tried to buy Nortel Networks Ltd. previously. Along with Motorola's CDMA and GSM assets, an acquisition would also give NSN Motorola's existing business relationships, as well as its LTE and TD-LTE assets, Schoolar noted.

Motorola had been trying to sell its networks business as part of its plan to separate the company into two pieces in 2011. Huawei Technologies Inc. was also rumored to be interested in the equipment business.

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The Federal Communications Commission is moving forward with plans to remove barriers in wireless backhaul, announcing it plans to address the issue at its Aug. 5 meeting.

The commission is issuing a Notice of Proposed Ruling and a Notice of Inquiry regarding backhaul. Previously, the agency noted as part of its National Broadband Plan that federal laws need to be implemented to help spur broadband deployment.

“Currently, access by service providers to poles can be slow, costly, and mired in long disputes. The National Broadband Plan recognized that one way to lower the costs of telecommunications, cable and broadband deployment and promote competition is to reduce the cost of access to infrastructure,” the FCC said in a press release announcing the further notice of proposed rulemaking as well as an order clarifying some aspects of pole attachments. “The plan found that the impact of utility pole attachment rates on broadband can be particularly acute in rural areas, where there often are more poles per mile than households.”

The FCC ruled that communications providers have a statutory right to use the same space- and cost-saving techniques that pole owners (utility companies) do, and that “attachers” have a right to timely decisions.

As wireless carriers and tower companies deploy DAS solutions to get better coverage, they often run into deployment delays because approving another piece of equipment on a pole is not a priority for utility companies.

Utility companies generally have to allow DAS providers access to the utility pole, but issues crop up around timelines and lease rates. Utility companies can try to charge DAS providers more than they do other tenants on the pole because the DAS provider usually wants to be at the top of the pole. Also, if the pole needs to be modified to accommodate the weight of new equipment, the utility companies can charge the DAS provider to pay for the new pole.

The FCC also released its formal NPRM and NOI on freeing up more Mobile Satellite Services spectrum, also part of the goals of the National Broadband Plan. The agency is planning to add co-primary fixed and mobile allocations to the 2 GHz band and expand secondary market policies and rules.

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Sprint Nextel Corp. managed to find another prepaid niche it had not already covered with the launch this morning of its PayLo offering through its Virgin Mobile subsidiary. The service brings a voice-focused component to what has been a data-centric menu from Virgin Mobile.

The new offering includes a 400-minute voice plan for $20 per month, or a per-minute rate of 5 cents per minute. Or for those that talk even less, the plan allows customers to pay $20 to “maintain” an active account for up to 90 days with voice calls during that time charged at 20 cents per minute.

Virgin Mobile's Chief Marketing Officer Neil Lindsay said the service is targeted at customers looking to keep their wireless spend at $20 or less per month.

“It's the perfect complement to our multibrand strategy,” Lindsay said in a press release.

Virgin Mobile said the service would roll out in retail locations this month, including RadioShack and Best Buy locations as well as at other “drug and convenience stores.”

Devices for the service will initially be limited to the LG Electronics Co. Ltd. LG101 at $20 and the Samsung Electronics Co. Ltd. M340 at $40, both of which are available at the same price for Sprint Nextel's recently launched Common Cents offering. In addition to the voice plans, customer can also send or receive text messages for 15 cents each, picture messages for 25 cents each or access data services for $1.50 per megabyte. In other words, if you are looking to access messaging or data services, Sprint Nextel has better offerings for you.

The PayLo service joins Sprint Nextel's cavalcade of prepaid options that include the data-centric services from Virgin Mobile, unlimited voice and data offering from Boost Mobile, the Common Cents pay-as-you-go service and its federally subsidized Assurance Wireless plans.

In addition to bolstering its prepaid line up, Sprint Nextel also reported that its Assurance offering has expanded to Florida and Louisiana joining its continued availability in Maryland, Michigan, New York, North Carolina, Tennessee, Texas and Virginia.

The service provides a free phone and 200 free minutes of voice service each month to eligible customers. Customers can then pay an additional 10 cents per minute for calls over their allotted bucket and 10 cents for text, e-mail or instant messages. Subsidies for the service are supported by the Lifeline Assistance program, which is part of the Low Income Program of the Universal Service Fund.

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Following years of instability, Alltel Wireless looks to have found its footing in the mobile market having recently put into place all of the pieces necessary to re-establish the veteran brand into the market.

The “new” Alltel Wireless is operated by Allied Wireless Communications Corp., which is staffed by former Alltel Communications L.L.C. and is a wholly-owned subsidiary of telecom company Atlantic Tele-Network Inc. ATN closed on its $223 million acquisition of the Alltel assets in late April after having gained government approval earlier that month.

As part of its acquisition, ATN also picked up the Alltel name and accompanying service marks, like My Circle, for use in its current markets an initial term of 14 years and a total term of up to 28 years.

“We feel like it's putting the band back together here in Little Rock,” explained Wade McGill, chief administrative officer for Alltel Wireless and AWCC. The original Alltel Corp. was headquartered in Little Rock, Ark., before being acquired by Verizon Wireless for $28 billion in early 2009. As part of the acquisition, Verizon Wireless was forced to divest some markets, a majority of which were acquired by AT&T Mobility for $3 billion, with the rest picked up by ATN.

Those markets picked up by ATN included functioning networks in six states – including portions of Georgia, Illinois, North Carolina, South Carolina, Ohio and Idaho – and nearly 900,000 customers.

“I think the trust did a very good job of keeping the brand going,” McGill noted. “So many people were just so committed to the brand and the markets.”

While its local markets are diverse geographically, the carrier maintains a nationwide footprint through roaming agreements.

Perhaps more important for ATN was its ability to secure the Alltel brand, which had built up tremendous brand equity in its markets.

“The ability to retain the brand was key in these markets and you can't underestimate the value of that,” McGill noted, adding that more than 50% of its current employees have been with Alltel for more than six years.

In addition to maintaining the Alltel brand, the new operations plans to maintain many of the services offered by the “old” Alltel, including continued promotion of its MyCircle plans that were one of the first to incorporate a select number of phone numbers for unlimited calling, regardless of carrier.

The brand acquisition also allows for possible expansion beyond current markets, though McGill and AWCC are keeping any expansion plans close to the vest, noting the company was more focused in the short term on reestablishing itself in the market.

“We need to have a laser focus on the customer experience and being local,” McGill explained, citing a common mantra of rural carriers forced to compete against large, nationwide operators. “That's how we want to think about our plans moving forward. … I think our plan is to grow organically at first and just focus on providing excellent customer service and support.”

McGill said the carrier will also maintain its current CDMA-based 3G network, but added that LTE was in the carrier's future, though he was unable to provide any details on those plans. Alltel's previous incarnation had committed to the LTE technology before being acquired by Verizon Wireless.

Microwave box

McGill noted that one of the biggest challenges facing the new Alltel is that while its leadership has a start-up mentality, operationally the carrier is hitting the ground with nearly 900,000 customers that expect their wireless carrier to act as it always has and 500 employees in the field looking towards headquarters for direction.

“In one sense we are still a start up here in Little Rock, but are a functioning wireless carrier in our markets,” McGill noted. “I still have a printer in my office sitting on an empty microwave box. It's not that we can't buy a stand or anything, it's just that that's where we are at this point.”

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Despite claims that the WiMAX market is set for rough waters, one analyst firm noted in a recent report that new specifications for the technology and overall growth in fixed/portable WiMAX deployments around the world are creating a “sizable” market for WiMAX equipment for the next 10 years.

Visant Strategies noted in its report, “Fixed, portable and mobile WiMAX: Building a market today and influencing choices tomorrow,” that new specification for 802.16m, also known as mobile WiMAX, will address a number of shortcomings with the 802.16e WiMAX standard, including improving costs and providing a more appealing business model.

“Most mobile carriers have committed to LTE for 4G, sometimes after HSPA+, but WiMAX equipment makers will still enjoy a vigorous market” said Andy Fuertes of Visant Strategies. “Low-cost PC initiatives, falling WiMAX costs and the global availability of the 3.5 GHz band for basic fixed broadband services presents a very large opportunity for WiMAX equipment vendors.”

Visant forecasts that WiMAX equipment revenues will surge to more than $35 billion by 2016 fueled by mobile WiMAX subscriber growth increase more than eight times current levels to more than 1 billion customers worldwide.

“There will be a very large fixed broadband audience by 2016, over one billion according to the findings in the report, and fixed/portable WiMAX will account for a good share of this audience and help seed mobile WiMAX use as these same carriers expand their coverage area in many emerging regions,” said Larry Swasey of Visant Strategies. “We are already seeing WiMAX deployments in emerging economies that allow intra- and inter-city portability, the beginning of the seeding.”

In-Stat noted in a report last month that WiMAX could be in for some challenges as competing technologies like LTE begin coming to market. The firm did note that it expects worldwide WiMAX subscription revenues to approach $30.2 billion in 2014, though major hardware vendors have announced they planned to stop WiMAX product developments.

Maravedis expressed similar concerns, noting that its research has shown carriers are concerned about the lack of support for the 802.16m standard, which could dampen enthusiasm for greater WiMAX deployments.

The firm added that carriers that have recently acquired spectrum licenses in markets like India may be forced to move ahead with WiMAX due to a lack of options in the short-term, but that eventual migration to the TD-LTE standard could prove a “significant challenge emerges regarding how to manage the millions of WiMAX device users.”

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Editor's Note: This article is an excerpt from RCR Wireless News' May Special Edition, "Enabling the Mobile Revolution: Mobile Chips, Devices and Accessories." The 80-page special edition is available here.

The Subscriber Identity Module – that standard little chip that houses all of a subscriber's information for GSM-based networks – is changing. Long Term Evolution technology is advancing the smart card, while the potential of machine-to-machine communications is evolving the size and form factors for SIMs.

The SIM card is evolving from a simple card that can store and authenticate a user to the network to a Universal Integrated Circuit Card, said Sebastien Cano, Senior VP Telecommunications for Gemalto NV, the world's largest SIM card manufacturer.

Going forward, the prospects for SIM deployments are great as CDMA providers like Verizon Wireless and MetroPCS Communications Inc. deploy LTE services, thus increasing the potential marketing base for smartcard solutions in the United States, said Heather Klein, director of marketing communications at Giesecke & Devrient, which also makes SIM cards. Operators will want to ensure interoperability between their CDMA and LTE networks.

In developing countries, the SIM has a visible role to play in that it keeps contacts with the user, not the phone, and that it authenticates the phone to the network. In advanced markets like North America, it is not so much involved in the user interface, but in monitoring network behavior. Once operators deploy LTE service, the SIM card will be able to more easily conduct over-the-air updates, Cano said. Today's SIM cards are limited to sending commands in 160-character text messages. Sending advanced commands via the technology has been cumbersome, he said. “You can do remote maintenance, but it's not as reliable as it will be going forward.” With the movement to an IP protocol, the card can perform a lot more functions.

The SIM card is now offered in three standard formats – as a SIM card, as an embedded secure element of a device and as a secure micro SD, G&D's Klein noted. Rugged form factors for SIM cards are appealing to companies that want an embedded M2M solution, Cano explained.

Going forward, some of the best areas of growth will be in the NFC (near-field communications) space and in the growing vertical market sectors that need M2M communications. As NFC gains traction around the globe, both SIM manufacturers expect financial institutions, which already use smart cards, to embed wireless technology in them. However, one of the problems with the intersection of wireless services and financial services is who owns the customer, Cano said. Having a third-party solutions provider is one way to solve that problem. Both Gemalto and G&D have been acquiring companies in recent years to expand their presence in the smart-card space.

Motorola Inc. is introducing what it calls an Intelligent SIM platform that lays over the SIM card. The four millimeter-thick wafer connects the mobile device and the SIM, which can enable operators and enterprises to write applications on the SIM and manage security protocols, said Venkat Eswara, Motorola's director of marketing for its Applications and Mobile Video Services division. Today, Motorola's iSIM is geared for 3G networks, but the company plans to move into LTE technology. The platform is available in three chip configurations – as a low-end microcontroller chip, as an NXP Java applet and as an NFC chip. The iSIM platform can store up to four different SIM profiles, which is important for people who travel internationally and need to roam, and for enterprises that are security-focused, like mobile banking applications. Motorola is targeting large enterprises with the platform, noting that large companies can use the iSIM platform to manage the work environment applications of employees who use different networks and different carriers. Bipper Communications is the first company to launch Motorola's platform to offer parents a way to manage their child's mobile-phone use, including a safety alarm and location-based service from a Web portal.

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Consumers are increasingly tapping into the advanced features of their mobile devices, according to a new report released by Compete Inc. as part of its Quarterly Smartphone Intelligence Survey.

The firm noted that during the first quarter of this year nearly one in three smartphone owners has called or stopped into a local business after discovering the information using a local search application on their mobile device. The survey also found that close to one-third of consumers with either an Apple Inc. iPhone or a smartphone powered by Google Inc.'s Android operating system “discovered at least two new businesses that they were not previously aware of as a result of using local search applications.”

“With the increasing popularity of local search, retailers should ensure their sites are optimized for mobile browsers," said Danielle Nohe, director of technology and entertainment for Compete. "Making it easy for consumers to discover businesses via their devices opens local companies up to a whole new customer demographic, and savvy businesses should make sure they're maximizing this opportunity."

Social is mobile

Compete's survey also found that a growing number of consumers are turning to their mobile devices to stay in touch with their social networks. The company noted that 33% of Twitter users with a smartphone primarily send tweets from their mobile device and that a similar percent prefer to read others' tweets on their phone.

Compete's survey noted that of consumers that access their Facebook accounts from their mobile device, 66% also read news feeds, 60% post status updates, 59% read or reply to private messages and 44% post photos from their smartphone.

"Given the increasing popularity of Facebook, Twitter and other social sites, it follows that users are eager to access these outlets on their phones," continued Nohe. "Based on our findings, I recommend marketers start thinking about new ways to maximize consumers' use of smartphones on social sites, as mobile adoption will likely only increase with time."

The iPhone is a game

Finally, Compete found that 51% of iPhone users have at least five games loaded onto their device, and that they play games more frequently that do owners of other smartphones with 37% of iPhone users reporting they play games at least daily on their device. Consumers with Research In Motion Ltd.'s Blackberry devices are at the other extreme with 46% of Blackberry users surveyed saying they have no games on their device.

"It's evident that iPhone owners have embraced mobile gaming," commented Nohe. "Developers should turn their attention to targeting other smartphone users in an effort to even out the discrepancies in mobile gaming adoption."

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T-Mobile USA Inc. (DT) closed a chapter on its Sidekick franchise last Friday as the industry’s No. 4 carrier stopped selling the iconic device, though it said it will continue to support product services and support.

The carrier hinted that while the current lineup of Sharp Corp.-built and Danger/Microsoft Corp. (MSFT)-powered devices has seen its last days, it could be developing a succeeding lineup in the coming months.

“As T-Mobile looks to further innovate and raise the bar for the next generation of the T-Mobile Sidekick, as of July 2, the Sidekick LX and Sidekick 2008 will no longer be available through T-Mobile, including retail stores, care, telesales and online,” noted T-Mobile USA spokesman Peter Dobrow in a statement. “While we work on the next chapter of our storied Sidekick franchise, T-Mobile will continue to provide our loyal Sidekick customers with product service and support. Stay tuned for exciting updates in the months ahead, which we expect will provide customers with a new and fresh experience.”

Despite a near cult-like following, the Sidekick devices have been overshadowed in T-Mobile USA’s lineup by an increasing number of devices powered by Google Inc.’s (GOOG) Android operating system that provide many of the same functions of the Sidekick models with greater access to an increasingly-important applications store.

Last October the Sidekick service suffered a near-meltdown that stranded consumer data that was normally stored on servers whenever a consumer turned their device off. T-Mobile USA and Microsoft were eventually able to restore user data.

The demise of the Danger/Microsoft-powered Sidekicks came just days after Microsoft discontinued its Kin devices that were developed using expertise the company picked up when it acquired Danger Inc. in 2008 and were also built by Sharp. The Kin lineup was launched in May exclusively at Verizon Wireless (VZ), but reportedly met with dismal sales as consumers were confused about the devices’ positioning as more than a quick-messaging device, but not quite a smartphone. The not-quite-a-smartphone issue was more pressing as consumers were forced to pay $30 per month for Verizon Wireless’ smartphone data package even though the Kin’s lacked much of the functionality seen as standard in smartphones.

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President Barak Obama issued a memorandum to free up 500 megahertz of spectrum in the next 10 years, directing the National Telecommunications and Information Administration and the Federal Communications Commission to free up federal and nonfederal spectrum.

The details of the president's four-point plan to bring more spectrum to commercial use are similar to his National Broadband Plan. “As demand for mobile services skyrockets, so too will the need for additional spectrum frequencies to facilitate this transformation. Without a strategy for freeing up more spectrum for wireless technology, the United States will fall behind in technological innovation and 21st-century jobs as cutting edge applications and technologies that depend on broadband wireless platforms are invented in countries with more advanced wireless infrastructure,” according to a fact sheet detailing the memorandum.

The president asked that NTIA and the FCC identify by Oct. 1 any spectrum that can be freed up within five years for exclusive or shared use and asked that the agencies create an inventory of spectrum to help identify what spectrum could be freed up, as well as create a timeline for such spectrum.

Along with freeing up 500 megahertz of spectrum, the president would like to change the rules so government and commercial spectrum holders can realize greater and earlier benefits from giving up their spectrum; value the spectrum the most, which means auctioning most of the spectrum, but setting some aside for unlicensed use and sharing spectrum when possible. Finally, the memorandum proposes using auction proceeds to aid public safety, reduce the federal deficit and create jobs in industries like smart grids.

“The administration has no official estimate of the auction revenues from this plan. The actual amount will depend on effective implementation and additional design details, but based on past auctions, many analysts believe the revenue potential could reach in the tens of billions of dollars. The proceeds would be invested in public safety, additional job-creating infrastructure investments and deficit reduction,” according to a fact sheet announcing the memorandum.

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Spectrum Bridge Inc. said it is working with a California utility to use white-spaces technology to deploy a smart-grid network in the Sierra Nevada Mountains and offer wireless broadband service to area residents.

Spectrum Bridge is working with the Plumas-Sierra Rural Electric Cooperative to manage the supply and demand of electricity, improve System Control and Data Acquisition (SCADA) at substations, and with Google Inc., which is supplying its free PowerMeter sevice.

The project to show how a smart-grid network can work is part of Spectrum Bridge’s continuing push to show how white-spaces spectrum can be used as a Wi-Fi-like, next-generation technology, said CEO Richard Licursi. White-spaces spectrum can propagate through dense forestry and rugged terrain, reaching eight to 10 miles at a time, Licursi noted. Lake Mary, Fla.-based Spectrum Bridge eventually wants to sell its technology to original equipment manufacturers at the chip, device and access point level. As such, the company has built a wireless broadband network in a small Virginia town using white-spaces technology. The company has operated a smart city to show how wireless broadband via white spaces could be used for public security and telemetry applications. Licursi said the Gulf of Mexico oil catastrophe provides another example of how white-spaces technology could be used – to monitor water quality.

“PSREC currently employs a wide variety of wireless solutions across multiple frequency bands, but still faces challenges in some areas due to challenging terrain,” the companies said in a press release. “The applications deployed for the Plumas-Sierra ‘Smart Grid’ wireless network trial deliver real-time broadband connectivity to remote substations and switchgear, allowing PSREC system operators to manage the electrical system remotely, request critical data from substations, manage power flow and protect the system and employees while maintaining the local grid.”

Further, the access points in the home use Google’s PowerMeter product so residents can monitor their electrical use, said Licursi, explaining that Google wanted to sample how its product did in this environment. Residents also can deploy Wi-Fi in the home and use the white-spaces spectrum for backhaul to get broadband connectivity from the co-op.

The Federal Communications Commission approved white-spaces spectrum for unlicensed use. The agency was concerned, however, that the technology operating on the white-spaces spectrum, not interfere with existing uses of the frequencies, like TV broadcasting channels and wireless microphone uses. As such, white-spaces radios must “check in” with a white-spaces database to make sure the spectrum does not cause interference.

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Sprint Nextel Corp. (S) and partner Clearwire Corp. (CLWR)continued their full-court WiMAX press this morning announcing a trio of new markets where service is available as well as a new device set to launch later this year.

Both companies said they are now offering WiMAX service in Salt Lake City; St. Louis; and Richmond, Va., pushing their total market coverage to around 40 markets. The Sprint Nextel offering is marketed under its “4G” brand, while the Clearwire service is marketed under its “Clear” brand.

In addition to the extended coverage Sprint Nextel unveiled details of its second WiMAX-enabled smartphone, Samsung Electronics Co. Ltd. Epic 4G. The device is based on Samsung's Galaxy S platform and joins the recently launched HTC Corp. Evo 4G with access to Sprint Nextel's WiMAX service.

Samsung said the Epic 4G device will include a 4-inch AMOLED screen, slide-out QWERTY keyboard, run Google Inc.'s Android 2.1 operating system, a 5-megapixel camera as well as a front-facing camera and is powered by a 1 GHz Samsung processor. Sprint Nextel is working on a Android 2.2 update for later this year and said it would announce availability and pricing for the device in the “coming months.”

Sprint Nextel began selling the Evo 4G earlier this month and noted that it was the fastest selling device in its history, though the carrier did not provide hard numbers.

A recent report from In-Stat noted that while worldwide revenues from WiMAX services could top $30 billion by 2014, future growth could be impacted by the decision of a number of infrastructure providers to pull back support for the technology in favor of LTE.

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WASHINGTON, D.C. – While the weather this time of the year in Washington, D.C., can only be described as oppressive, the mood of the telecommunications community in the nation’s capital can best be described as ambitious.

That ambition is being directly led by the Federal Communications Commission, which under the leadership of Chairman Julius Genachowski has laid out an ambitious plan of reforming the current telecommunications landscape that is susceptible to change following any of the elections that keeps this place hoping.

One of the most controversial initiatives undertaken by the FCC is the National Broadband Plan, which is looking to expand the availability of broadband services across the country. While many in the wireless industry were disappointed that the initial recommendations of the NBP did not include a greater emphasis on wireless services, the FCC’s audacious plan to unlock up to 300 megahertz of new spectrum over the next five years and 500 megahertz over the next 10 years has drawn considerable interest.

Ruth Milkman, bureau chief for the FCC’s Wireless Telecommunications Bureau, agreed that the target is an ambitious one and that the commission it will face challenges in freeing up much of that spectrum, which the commission hopes to wrestle from the hands of commercial television broadcasters. To do so the FCC is looking at changes to the current law that require proceeds from spectrum auctions be deposited into the national treasury so that it may instead use some of the proceeds to reimburse broadcasters for giving up their precious spectrum assets.

“We have to have a goal and we know that the 300 megahertz goal is ambitious, but we think it’s achievable,” Milkman said.

Milkman did add that the commission is comfortable with the current route in which spectrum is auctioned to interested telecom providers, a route that has seen nearly $35 billion in proceeds deposited into the national treasury over the past five years.

Differences brewing

One change that does appear to be brewing is a possible crack in the traditionally strong regulatory front pursued by the industry’s nationwide operators and spearheaded by wireless trade association CTIA. A number of people we spoke with noted that the growing market share difference between the nation’s No. 1 and No. 2 operators Verizon Wireless and AT&T Mobility and the No. 3 and No. 4 operators Sprint Nextel Corp. and T-Mobile USA Inc. has started to cause a riff amongst the interest of carriers.

One analyst noted that Sprint Nextel and T-Mobile USA have recently begun to side more with the interest of rural operators that for years have struggled to compete against the industry’s nationwide operators.

“The wireless industry is still united on most issues,” explained Charles McKee, VP for state and federal regulatory issues at Sprint Nextel. “But, there are also some areas of tension that need to be acknowledged. … Trade associations have the difficult job of trying to reconcile amongst its members, but our goal is to promote our agenda that is beneficial to the wireless industry and not to the ILEC industry.”

Nearly all agreed that while there is competition on the commercial side of the wireless industry, they questioned the same level of competition when it comes to the behind-the-scenes aspects, including special access and certain legacy government programs. Those targeted for having an advantage in these regards included both large companies like Verizon Communications Inc. and AT&T Inc., as well as regional and rural wireline players.

“When it comes to issues like special access we have to look hard to find competition in that space,” said Kathleen O’Brien Ham, VP of Federal Regulatory Affairs for T-Mobile USA.

Telecom Act redux?

One topic no one seemed willing to broach was the possibility of a rewrite of the 1996 Telecom Act that has been mentioned by some lawmakers. While there was acknowledgement that the telecommunications, and more specifically the mobile industry, is vastly different today than it was 14 years ago, the thought of trying to revamp that overarching document would be a tall order.

Sprint Nextel’s McKee noted that any talk of a rewrite is fraught with peril, but acknowledged that the telecommunications industry today is vastly different from the one in 1996 when the act was passed.

''The Telecom Act did a lot to change the industry and in a very positive way,” McKee said. “But there is no way we could have predicted how much the industry has changed and where we are now. Rewriting the Telecom Act? Talk about a huge undertaking.''

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The Global mobile Suppliers Association said that it expects 22 LTE networks to be up and running by the end of this year with an additional 23 networks operational by the end of 2012.

The GSA added that 80 operators have made ''firm commitments to deploy LTE networks in 33 countries,'' an increase from 64 network commitments two months ago, and that 110 operators in 48 countries are “currently investing in LTE networks.”

Spurring the deployment plans were the recently completed spectrum auctions in Denmark, Germany and the Netherlands. Spectrum being looked at for LTE deployments around the world include 700 MHz in the Americas, and 800 MHz, 1.8 GHz and 2.6 GHz in Europe.

Those domestic plans include Verizon Wireless and MetroPCS Communications Inc., which have said they plan to have networks up and running by the end of the year, as well as AT&T Mobility, which is on track for network trials in 2011 and commercial deployments in 2012. WiMAX supporter Clearwire Corp. has also said that it was looking at possible LTE deployments using its extensive 2.5 GHz spectrum holdings, a move already announced by Russian operator Yota.

LTE technology is also expected to get a boost from the TD-LTE protocol that is gaining supporters in China.

“'The success of recent LTE systems launches, newly completed spectrum auctions in 2.6 GHz and 800 MHz bands, and the continuing strong upsurge in mobile broadband worldwide are combining to produce the huge momentum for LTE we see right now,” said Alan Hadden, President of GSA. “LTE is essential to take mobile broadband to the mass market.''

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Canadian cable company Videotron is planning to launch wireless service in Quebec this summer, although the company is staying mum on launch specifics.

In an address at the 2010 Canadian Telecom Summit in Toronto, Robert Depatie, president and CEO of Videotron, shared some insight into the company's launch. "We are engaged in extensive network testing and are on the verge of launching Quebec's most competitive, and its most complete wireless service. Our 3.75 generation network will be fast, able and stable, with technology and entertainment capabilities that will go above and beyond what is presently out there. Our wireless network will soon be at the heart of our strategies and our wireless plan, like all our service and product plans, will be focused on the customer and on how will we deliver value."

The Canadian company, a subsidiary of Quebecor Media, won AWS spectrum licenses for Quebec, Toronto and eastern Ontario, paying more than $554 million (Canadian) for the license. Videotron today operates as an MVNO with 85,300 customers, but its main business is cable TV and broadband Internet service. It counts nearly 1.8 million cable TV customers in Quebec and nearly 1.2 million cable modem customers.

"We see our wireless network as an excellent means to extend the Videotron experience to mobile users, certainly, but also to fixed users who are beyond the reach of our fixed broadband services," Depatie said. "Our goal is to provide our customers with an ecosystem, an environment that can respond to customer requests and requirements and that can create new services. ... Full choice, full flexibility, full ubiquity. With this, our customers will have three screens, three different formats, which means three different types of challenges for our systems and processes. Our job is to make it work, to put the customer in control and make sure that the choice, the flexibility and the ubiquity are truly there. All of these three equal the Videotron technological ecosystem," Depatie said.

Videotron has inked roaming agreements with Rogers in Canada and T-Mobile USA Inc. in the United States.

The Canadian government in 2008 auctioned more spectrum to bring greater wireless competition to the country. Rogers Wireless, Telus Corp. and Bell Mobility dominate the marketplace today. New entrants include Vidoetron, Globalive Holdings and Mobilicity.

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India’s Broadband Wireless Auction ended after 117 rounds, raking in nearly $5.5 billion for the government. Infotel Broadband Services Ltd. was the big winner, paying $2.74 billion for licenses in all 22 circles. Interestingly, Indian conglomerate Reliance Industries Ltd. announced that it is buying 95% of Internet service provider Infotel.

State-owned operators Bharat Sangar Nigam Ltd. and Mahanagar Telelphone Nigam Ltd. are required to match the auction prices paid for their spectrum, bringing the auction proceeds to more than $8 billion.

Reliance, which is paying about $1 billion for Infotel, said it will use LTE technology to bring mobile broadband services on its new spectrum. “RIL sees the broadband opportunity as a new frontier of knowledge economy in which it can take a leadership position and provide India with an opportunity to be in the forefront among the countries providing world-class 4G network and services. A single 20-megahertz TDD spectrum when used with LTE (Long Term Evolution) has the potential of providing greater capacity when compared to existing communication infrastructure in the country,” the company said. Reliance is India’s largest private-sector company, with a net worth of $30.6 billion.

Qualcomm Inc., which entered the auction to push LTE technology for the BWA licensees rather than WiMAX, picked up licenses in Delhi, Mumbai, Kerala and Haryan, paying just over $1 billion for the licenses. The San Diego-based company said it would soon announce its Indian partners to comply with Indian Foreign Direct Investment regulations.

Of the 11 bidders, six won licenses. Other winners include Bharti (four licenses); Aircel, (eight licenses); Tikona, (five licenses); and Augere, (one license).

All licenses are provisional wins by the Indian government at this point.

The Indian government concluded its 3G auction last month, raising nearly $14.6 billion.

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As the Wholesale Applications Community takes steps to form in July, widget companies like Snac are hoping to see operators embrace widgets as another way to drive data traffic, said Snac CEO Mark Caron.

The WAC initiative, announced at Mobile World Congress earlier this year, is a way for wireless operators to make themselves relevant , and get relevant revenues, from delivering mobile applications to end users. Today device manufacturers/operating system providers and developers share that revenue, leaving operators largely out of the picture. As such, 29 companies, mostly operators, now have joined the WAC community to re-insert themselves into the revenue equation.

WAC laid out an aggressive timeline to launch earlier this month. The group will officially form in July, announcing its board of directors and laying out its business model, said Tim Raby, who is acting CEO of the WAC and also the managing director for the Open Mobile Terminal Platform. The first specifications will be announced in September and the group plans to hold its first applications developer event in November. Then at MWC in 2011, the WAC initiative should be open for business, Raby said at an analyst briefing earlier this month.

The problem with so many OSes and devices is well documented: the market is fragmented, forcing applications developers to choose which platform and device to pin the success of their app on. For many, the Apple iPhone has been the first choice. (Apple is not a member of WAC and not likely to join.) But Apple only represents a small percentage of the overall market, Caron noted. WAC is hoping the 3 billion end users its operators count and its global geographic scale will lure developers to write for the specification, which blends three application platforms: the Joint Innovation Lab, or JIL, OMTP’s Bondi platform and the GSMA’s One API. “The application world is becoming increasingly decoupled from the investment that’s required to support them,” Raby said. “The investment is required to support the applications going forward, whatever the platform.”

Operators will be able to use their network assets, including billing and customer care, to enable all kinds of new applications once the WAC initiative is working, Caron said.

“A long-term opportunity for us is to license our technology to carriers and device vendors,” Caron said. “We’re talking with carriers but we’re not waiting for them.” Today Snac courts it partners to have their own widgets for people to download off-deck.

Widgets are still important for even as smartphone adoption increases, Caron said, because widgets can drive so many more applications than native applications preinstalled on a device. People will access wireless applications three ways, Caron noted. Native applications are flourishing and will continue to do so, he said. The deep integration that happens when an app is written to run on a specific device is impressive, but it is expensive to write and limited to one OS. At the other end of the spectrum are mobile applications that access the Web, which also brings scale but not always a great user experience.

In the middle sit widgets, which run in the background on a device, and are light and fast so they don’t drain a device’s battery.

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Mobile broadband technologies, including LTE, HSPA and CDMA2000 1x EV-DO technologies, are set to dominate the mobile space over the next 10 years, though the rise is not expected to hit its stride until the middle of the current decade, according to a report from WiseHarbor Research.

The analyst firm, which laid out a number of forecasts for the coming decade, said it expects mobile broadband technologies will bridge the digital divide through the current decade for Internet and data communications by 2020 and will follow the lead that GSM and CDMA2000 1x achieved in the voice and text space.

WiseHarbor noted that LTE will mirror the success of GSM technologies, but that it won't be until 2016 before LTE accounts for more than 25% of mobile broadband device sales, and that it won't match device sales from CDMA-based technologies and HSPA/HSPA+ technologies combined until 2019.

The Asia Pacific region is expected to lead the world in mobile broadband and LTE device sales beginning next year, according to the report, which added that developed nations will lead in devices sold per capita. Device revenues from handsets, wireless modems and embedded modules is expected to peak in 2015 before being hit by falling selling prices and saturated demand. Revenue growth will then come from non-traditional devices that will see an increase in connectivity options.

WiseHarbor also noted that the growth of the TD-LTE standard will result in the demise of WiMAX beginning in the second half of the decade.

''Whereas WiMAX has made significant commercial progress by occupying the unpaired spectrum that tends to be much cheaper than the paired spectrum used for CDMA-based technologies including EV-DO and HSPA, TD-LTE will eclipse WiMAX by prevailing in the use of unpaired spectrum as well as the paired spectrum already employed commercially by LTE,'' the report explains. ''Commitment to TD-LTE by China Mobile in particular and significant commonalities between LTE technologies and manufactured products with TDD and FDD modes will marginalize WiMAX in the marketplace over the next few years.''

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Clearwire Corp. officially launched service in Kansas City and Washington, D.C., and expanded service in Baltimore. The WiMAX operator is offering an online-only mobile Internet promotion with plans starting at $15 per month for two months after a $50 service credit in all three markets.

In Baltimore, Clearwire said it expanded to service to now cover 1.7 million people. The coverage area now goes as far north as Bel Air, as far south as Annapolis and west to Owings Mills and east to Dundalk and Essex. Dean Young has been named general manager for the market.

In central Washington, D.C., Clearwire said it covers nearly 1 million people, including the communities of Chevy Chase and Silver Spring, Md., Alexandria and Falls Church, Va., as well as College Park, Md. Jeff Fugate has been named general manager for the area.

Clearwire also launched service in partner Sprint Nextel Corp.'s headquarters of Kansas City, Kan., and neighboring Missouri, where its service covers more than 1.1 million people. The company named John O'Donnellas GM for the region.

Clearwire CEO Bill Morrow said in its first-quarter operating results that it is on track to cover 120 million potential customers by the end of the year. The carrier plans to turn on service in St. Louis, Mo., Salt Lake City, Utah, and Nashville, Tenn., yet this summer.

Clearwire has said that its WiMAX deployment has allowed it a first-to-market 4G advantage, although the rhetoric over 4G continues to intensify, with T-Mobile USA Inc. announcing what it calls 4G speeds on its HSPA+ network as it rolls out 21 Megabit per second technology in some Northeast markets, while Verizon Wireless plans to cover 100 million pops by the end of the year.

Meanwhile, amid speculation that Clearwire will shift to LTE technology eventually, research company WiseHarbor just released a report that says WiMAX sales will peak by 2015, as the introduction of TD-LTE service will spur the demise of WiMAX technology. “ Whereas WiMAX has made significant commercial progress by occupying the unpaired spectrum that tends to be much cheaper than the paired spectrum used for CDMA-based technologies including EV-DO and HSPA, TD-LTE will eclipse WiMAX by prevailing in the use of unpaired spectrum as well as the paired spectrum already employed commercially by LTE. Commitment to TD-LTE by China Mobile in particular and significant commonalities between LTE technologies and manufactured products with TDD and FDD modes will marginalize WiMAX in the marketplace over the next few years.”

Hello! And welcome to our Friday column, Worst of the Week. There's a lot of nutty stuff that goes on in this industry, so this column is a chance for us at RCRWireless.com to rant and rave about whatever rubs us the wrong way. We hope you enjoy it!

And without further ado:

So, word on the street is that the mobile industry is going prepaid crazy. This new track has been highlighted by the dearth of new postpaid customers signing up for wireless services, and those that are signing contracts look to be just switching from another carrier.

In response, just about all carriers have over the past six months gone ape-poop in rolling out or creating new prepaid options for customers that allow them nearly all the perks of postpaid plans without having to go through a pesky credit check – always painful unless conducted by a trained professional – or committing to remain loyal to their carrier for 24 months no matter how poorly they are treated or face a break-up fee. (Nothing says “I really respect you as a customer” than swinging a cancellation fee over your head to make you stay loyal.)

Any sane person would look at these options and realize that signing a contract is for suckers and the only real option is to go prepaid. (Thus my decision to recently re-up some members of my family on new contracts. Hey, I got a degree in journalism, not reasoning.)

This rush to cater to those customers that have either by choice decided that they don't want to commit to one carrier for 730 days or by circumstance do not possess the credit “number” that backs up their signature is fascinating to watch.

In one corner there are Sprint Nextel and T-Mobile USA, the nation's No. 3 and No. 4 largest carriers that while nationwide in scope have failed to keep pace with the customer growth and free-spending nature of their larger rivals Verizon Wireless and AT&T Mobility. Thus, these two have been forced to try to attract the “underserved” population of consumers looking for prepaid service.

Sprint Nextel has indeed been the most aggressive as of late now offering four different ways to get customers on its network without being forced by a contract to stay. T-Mobile USA on the other hand has kept its prepaid offerings fairly simple, though to what I can only assume is the consternation of current contract customers is offering a better monthly value to those selecting prepaid.

In another corner you have the traditional no-contract carriers in MetroPCS and Leap/Cricket that continue to pound their heads against the wall in trying to remain a viable presence in the eyes of consumers, trading network scope for more features on calling plans. This trade off seems to be holding as both carriers announced solid first quarter growth numbers, though the financial future of their offerings is still suspect.

All of these carriers that have changed their focus, or continue to focus on prepaid are also forced to balance out consumers' desires to pay as little as possible for a phone (preferably a feature-packed smartphone that provides more capabilities than a Cray supercomputer for the low, low price of on the house) with the fact that without a contract there is no guarantee they will ever receive enough revenue in return to pay back a subsidy offered on a device. This has forced most of these carriers to charge a premium (or in effect, the real price) for mobile devices.

These carriers also don't seem to mind the "negative" connotations long held by the mobile industry of who prepaid customers are, and I say good for them.

In the meantime, the industry's heavyweights Verizon Wireless and AT&T Mobility remain on the sideline of this prepaid battle choosing to instead offer token no-contract services that look compelling when compared with their postpaid offerings, but fall flat when stacked up against the prepaid competition. Or at best they are keeping offers that run on their networks, like offerings from Tracfone, at arm's length in an attempt to keep investors worried about the possible financial impact that prepaid can have on a carrier's bottom line. And they seem happy to do so.

I liken this mentality to people that decide to cover up their tattoos or remove any visible piercings before heading into the country club for fear they may give the wrong impression.

This divergent view of how to deal with prepaid is sure to mutate over time, especially with carriers looking to push data services that seem to provide further confusion as to how carriers want to differ their marketing of prepaid and postpaid services.

So, where does this leave us? Well, to me it would seem to leave the wireless industry in some sort of mixed up, nether world. Prepaid is definitely where the growth seems to be coming from and this is the area that carriers more interested in showing growth to their shareholders than bottom line profits are heading. On the other hand, the current financial metrics of prepaid have left those carriers more interested in keeping the investors happy with higher margins on the outside of the prepaid battle.

My suggestion for clarifying these divergent paths. More commercials touting coverage and network speeds, maybe mixed with more apes. There is nothing like a diversion to make everything seem better.

OK, enough of that.

Thanks for checking out this week's Worst of the Week column. And now for some extras:

--In the some-number-of-degrees-of-separation bin, those wacky folks over at ChaCha recently put out the results of a survey showing that – you may want to sit down for this – teens like to text. (Cliffhanger. And cut to commercial.) The survey results showed that in a survey – that relied on text messaging to gather responses – more than two-thirds of those respondents that claimed to be teens or young adults – or really old toddlers – said text messaging was their favorite way to communicate. This is nothing new to anyone that has seen a roving pack of teens – or young adults or very old toddlers – in which nearly every member of that heard is looking down at their cellphone while standing in the middle of a group of what are supposed to be their friends.

While the most popular form of communication was not a surprise, the shocking numbers from the survey was the .29% that selected e-mail (has e-mail already jumped the shark?) and the 1.24% that selected “other.” Since the survey included choices that seemed to include just about every form of communication I can only assume that the “other” category had to include mental telepathy and sky writing.

I welcome your comments. Please send me an e-mail at dmeyer@ardenmediaco.com.

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The Federal Communications Commission said the wireless industry is more concentrated, rather than effectively competitive, in its 14th annual report on competition in the wireless sector. The commission also said innovation abounds in devices and applications, but that capital investment is declining relative to the growing size of the industry.

The report could impact the FCC's ongoing development of mobile broadband policies, including the National Broadband Plan and its efforts to reclassify some broadband services in order to be able to regulate them. The report covers the years 2008 and some of 2009.

While the report said key trends include a movement toward a data-driven traffic and that access to spectrum is important to competition, other findings may cause concern for operators that are fighting against more regulation. “There appears to be increasing concentration in the mobile wireless market. One widely used measure of industry concentration indicates that concentration has increased 32 percent since 2003 and 6.5 percent in 2008,” the FCC noted.

Further, the agency had a mixed message regarding industry's capital investment in wireless products and services, a point that carriers and other wireless players have been touting in their arguments for less regulation. The FCC stated: “Providers continue to invest significant capital in networks, despite the recent economic downturn. One source reports capital investment at around $25 billion in both 2005 and 2008, while another shows that capital investment declined from around $25 billion to around $20 billion during the same period. Because industry revenue has continued to grow, both sources show that capital investment has declined as a percentage of industry revenue over the same period (from 20 percent to 14 percent).”

For its part, CTIA was unimpressed with the FCC's findings. “We believe the commission missed an opportunity today to truly highlight one of the few glowing examples of investment, innovation and consumer choice in the U.S. economy. While we understand that the commission is not making any conclusion about the state of competition in the market, nor are they suggesting that the marketplace has changed to the detriment of consumers during 2008, we nonetheless are disappointed and confused as to why they've chosen not to make a finding of ‘effective competition' for that year,” said CTIA President and CEO Steve Largent in a prepared statement. “The hairman has committed to a fact based, data driven commission. We have embraced that and placed numerous facts, in the record, about each element of the wireless ecosystem. We believe, based on the facts submitted, that a determination of effective competition in the wireless marketplace is not only inescapable, but is actually quite simple – ask any American. Whether based on HHI, the raw number of competitors in each market, investment, handset and network innovation, price or consumer choice, the U.S. wireless market is the envy of the world. That is why the lack of a finding is so troubling.

“In the same week that the European Commission releases its Digital Agenda for Europe, where they conclude that EU Information and Communications Technology research and development spending is 40 percent of the amount spent in the U.S., we believe that all policymakers should be celebrating, indeed applauding, the more than $44 billion that the wireless industry invested in networks and spectrum in 2008. That amount is significantly more than Germany, France, Italy, Spain and the U.K. invested – combined – in their wireless networks.”

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HONOLULU, Hawaii--As WiMAX networks roll out across the globe, device manufacturers and operators are hoping to move beyond the dongle and computer modem to more innovative products, according to panelists at the Global WiMAX Business Development Forum.

Even as Sprint Nextel Corp. gets ready to launch the HTC Evo 4G handset in a few weeks, global operators are hoping that WiMAX chips get embedded in more nontraditional devices. For example, in Pakistan, a WiMAX chip embedded into a television could be a way for the nation's wireless broadband users to connect to the Internet, said Dr. Tanveer uI Haq, CTO at Pakistani WiMAX operator Wi-tribe. While there are only 7 million PC users in Pakistan, there are about 95 million cellular users and 95 million people who own TVs.

The technology is available to install a chip in a set-top box, said Craig Miller, VP of marketing and business development at Sequans. The trick is getting the consumer electronics manufacturers to include the chip in the manufacturing process.

As the WiMAX ecosystem develops, more products are getting embedded to support the various frequencies WiMAX operates in across the globe, said Kevin Jones, Intel Corp.'s Global 4G evangelist. Intel's 6250 adapter, for example, supports 2.3 GHz, 2.5 GHz and 3.5 GHz as well as Wi-Fi and is in more than 200 netbooks.

WiMAX operators also are interested in partnering with cellular providers to sell dual-mode handsets that marry 2G coverage for voice with 4G coverage for data. If operators ink those deals, device manufacturers will build products for them, but the carriers have to be able to sign deals with 2G cellular providers.

WiMAX chips are going to be embedded in a number of M2M devices, including smart-grid modules, said Lars Johnsson, VP of business development and marketing at chip-maker Beceem. “Utility companies want to use WiMAX as a gateway into the home.” Video surveillance cameras are another opportunity, he said. Video apps can't run on a 2G network so any kind of remote monitoring is another opportunity.

Panelists also questioned why Russian operator Yota failed in its attempt to bring a WiMAX handset to market two years, but a major difference between the Yota handset and Sprint Nextel's Evo handset is pricing: While the Yota handset, manufactured by HTC Corp., cost $1,000, Sprint Nextel's Evo handset is being sold at $200.

Some operators likely won't want to offer handsets as they market themselves to be DSL alternatives.

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Has Google’s Inc.’s Android operating system hit an inflexion point?

Data released today by The NPD Group Inc. would indicate that possibility as the research firm reported that the sale of devices powered by the OS outsold Apple Inc.’s iPhone OS during the first quarter of the year putting it right behind Research In Motion Ltd.’s Blackberry OS in total sales.

According to NPD’s research, RIM continued to lead OS sales during the first quarter garnering 36% of the OS market. Android climbed into the No. 2 position at 28%, while Apple’s iPhone OS was No. 3 with 21%. And this despite NPD’s research not including corporate or enterprise sales that have traditionally favored RIM’s OS.

The NPD Group noted that the strong sale of Android-powered smartphones at Verizon Wireless helped propel the nation’s largest carrier to within a whisker of AT&T Mobility’s iPhone-fueled smartphone sales for the quarter. AT&T Mobility continued to lead in market share at 32%, but Verizon Wireless slotted in a close No. 2 at 30%, followed by T-Mobile USA Inc. at 17% and Sprint Nextel Corp. at 15%.

Smartphone sales are becoming increasingly important to carriers as most require customers to sign up for data packages that range up to $30 per month in addition to regular voice and messaging packages.

A brief trip through the carrier Web sites shows a diverse reliance on different OSs depending on carrier.

Verizon Wireless is heaviest with those powered by Microsoft Corp.’s Windows OS counting seven different models including its two new Kin models. Next for the carrier is Blackberry with a half-dozen distinct devices, followed by four Android devices and a pair of Palm Inc.’s devices running its WebOS. In total the carrier has 19 distinct smartphones currently for sale.

For AT&T Mobility, RIM is large and in charge with six distinct models, followed by five running a variation of Windows, two running Nokia Corp.’s Symbian OS and two iPhone models (3G and 3GS). AT&T Mobility also has a single device running Linux in Garmin International Inc.’s Nuvifone and at this point only a single Android model in Motorola Inc.’s Backflip. AT&T Mobility has a total of 17 distinct smartphones for sale.

Sprint Nextel has the smallest number of distinct smartphones for sale with just 10 models. Those include three powered by RIM’s Blackberry OS and three powered by a version of Windows, and a pair each sporting Palm’s WebOS and Android.

T-Mobile USA has 11 distinct smartphones for sale, including five powered by Android, three powered by a Windows variation, a pair of Blackberry models, and a single device each powered by Symbian and the Danger Inc. OS in its Sidekick series, which is actually owned by Microsoft.

Nearly all of the nation’s top operators have a slew of smartphones slated to launch in the coming months with those powered by Android the most numerous.

“As in the past, carrier distribution and promotion have played a crucial role in determining smartphone market share,” said Ross Rubin, executive director of industry analysis for NPD, and a current contributor to RCR Wireless News’ “Analyst Angle” feature. “In order to compete with the iPhone, Verizon Wireless has expanded its buy-one-get-one offer beyond RIM devices to now include all of their smartphones.”

The NPD Group also noted that continued strong sales of smartphones and messaging devices pushed average selling prices of mobile phones up 5% during the first quarter compared with the same quarter of 2009 to $88, though ASPs for smartphones actually decreased 3% year-over-year to $151.

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Editor's Note:This article is an excerpt from RCR Wireless News' March Special Edition, "The Perfect Storm – A Focus on Mobile Messaging, Marketing, Content and Apps." The 80-page special edition is available here.

Following years of promises, and highlighted by the annual claim that the upcoming year was finally its year, 2010 actually is starting to shape up as the year mobile advertising could have its chance to shine. Sure, there have been mobile advertising and marketing campaigns in the past, but most have been half-hearted attempts that failed to garner significant traction, or if they did show promise, it was often of limited scope in the big picture of advertising.
The Kelsey Group reported late last year that the worldwide mobile advertising market could be worth more than $3 billion by 2013.
However, recent deals by some of the biggest technology names in the world have shed new light on the space. Google Inc.'s reported $750 million acquisition of Admob was followed by Apple Inc.'s reported $275 million buy of Quattro Wireless, placing both companies in a prime spot to foster the true blossoming of the mobile advertising market. These deals were followed more recently by Opera Software's purchase of AdMarvel Inc. for an undisclosed amount.
These deals alone will not make 2010 the year mobile advertising and marketing campaigns take off, but they show that the industry is getting very serious about mobile marketing initiatives and that they are willing to invest in them.
"I don't know if anyone ever wondered what the year of television was or the year of radio," said Edward Kershaw, VP of mobile at The Nielsen Co., during a panel discussion at the recent Mobile World Congress event in Barcelona, Spain. "Things can run on hype for quite a while, but at some point the industry needs ... to deliver us the media and combined tools that we all expect."
 
Making the connection
For mobile advertising and marketing to really take off, companies that deal with selling the idea and advantages of mobile need to be sold on the idea. The advertising industry has dramatically shifted its considerable spending over the past several years from "old" outlets like print media toward "newer" outlets like the Internet and other Web-based outlets. The big challenge now is to convince those advertisers that mobile needs to be included in that discussion.
The dilemma of mobile is that everyone on the media planning side wants to do something new, said Michael Bayle, VP of monetization and marketing at Amobee Inc. during the same discussion panel at MWC. To get any real return on their investment or worthwhile engagement though, scale matters most, he added.
Amobee recently announced plans to acquire mobile advertising agency RingRing Media for an undisclosed sum. Amobee said the deal will help it round out its offering to network operators, which include Telefonica SA and Vodafone Group plc, and help sellers "monetize mobile display inventory." London-based RingRing's dedicated mobile advertising platform handles more than 4 billion impressions per month.
Mobile assuredly has unsurpassed scale on the whole, but reaching across wide swaths of that user base similar to how print, TV, online and radio do is still almost impossible to imagine and difficult because of many legitimate reasons, like privacy, customer experience and others.
The traditional direct-marketing approach that the advertising and marketing worlds have built their empires upon does not apply to mobile, Kershaw said, and therein lies the problem. Mobile companies not only have to encourage a purchasing shift among digital marketers, but also a mindshift. Therefore it's incumbent upon mobile companies to help redefine the rules of marketing under the mobile lens – an entirely different animal than even its digital brethren in online media.
"It's just understanding where we compete and where we might collaborate," said Tim Sefton, customer director of Telefonica O2 U.K., adding that areas of collaboration should run along the lines of what the marketing industry needs to justify spend. Those include reach, targeting, engagement, results and measurability and loyalty.
 
SMS still king
These rifts explain why nearly 60% to 70% of all mobile marketing spend is via SMS. Sefton said SMS will definitely grow as the entire pie of mobile marketing grows, but the "amount of customers that are actually engaging in SMS advertising is quite small." Indeed, richer formats will drive more engagement, he added.
Kershaw jumped in to add that SMS marketing is very sophisticated outside of the Western world, particularly because those markets are less careful about the type of engagement they want to have with their customers.
But, the real challenge for SM-based marketing, and all marketing in general, is relevance. Mobile advertising is only welcome if it provides a value to customers, and if it fails to do so it's considered spam and will leave consumers with a bad taste in their mouths.
"No one ever bought the Starbucks text coupon model because there is no context," said Scott Seaborn, head of mobile for advertising, marketing and public relations firm Ogilvy Group U.K. "If you walk by a Starbucks on a hot day and get a coupon for hot coffee that is spam."
 
Devices remain a challenge
The issue of smartphone adoption is also paramount to the potential rise of mobile marketing. While the device segment was the darling of the industry in 2009, posting strong sales and witnessing a never-ending slew of new launches, it still remains a relatively small percentage of the overall market With forecasts suggesting around 30% of consumers will have smartphones by the end of 2013, that still leaves more than two-third of all consumers lugging around considerably less-robust devices.
Many have noted that the issue of device penetration should not be an issue with basic advertising and marketing campaigns utilizing text messaging. However, feature phones do limit the appeal and availability of more colorful and interactive options.
And even with those 30% or so of consumer expected to sport a smartphone, the diversity of mobile operating systems and platforms on those devices could further limit the adoption and growth of mobile marketing and advertising campaigns. This is most important to those brands looking to reach out to consumers through application-based campaigns that a consumer can download through an operating system's application store.
 
The Google effect
No discussion of advertising or marketing would be complete without a look at Google, which has revolutionized the mobile content and search market and has more recently set its considerable glance towards the mobile space.
Its recent acquisition of Admob is only the latest in a string of moves the company has made in advancing its mobile efforts, which are of prime importance to Google, according to Chairman and CEO Eric Schmidt.
Admob joins Google's vast wireless assets that are centered on its well known search capabilities and more recently its open source Android operating system. The latest version of its OS includes navigation capabilities that when merged with its search engine are expected to provide a powerful option for advertisers.
"The beauty of Google's navigation initiative is that its offering, while free, will result in profits via mobile search and advertising," said Jagdish Rebello, director and principal analyst at iSuppli. "These moves by Google are intended to drive the increased use of mobile searches and prompt new social networking behaviors that leverage cloud storage and mobile advertising. Given its overwhelming dominance in the Internet search application market, Google is now poised to leverage its search capabilities with location-based services (LBS) to drive mobile search results targeted at the location of the mobile consumer. Clearly, Google's strategy is to expand into areas where it has a competitive advantage due to its dominance in search and advertising. This, coupled with mobile advertising and mobile commerce, has the potential to unlock tremendous value for the mobile user and to drive new revenue opportunities for Google."
Advertisers appear in favor of this integration, noting that such efforts will simplify what is still seen as a very complicated process of getting a brand in front of the right audience.
"We are organizing our company so that we just don't buy television or search anymore, we are buying a one-stop shop," said Jakob Nielsen, managing director of GroupM U.K. Interaction. "We want to buy an audience and not just an impression. Google with Admob can bring a one-stop shop for us."
Similar expectations are forecast to Apple following its purchase of Quattro. Apple has a strong ecosystem of integrated services and hardware based on its iPhone and iTunes platforms that the addition of Quattro is set to enhance.
According to the Mobile Marketing Association, Quattro Wireless has been a force in the mobile marketing industry, and with the backing of Apple, it will no doubt shift the industry to new levels. Apple has never before acted as an advertising provider in any medium, which shows a significant amount of confidence that this industry leader is putting in mobile marketing.
"They've never done this before. Apple is one of the most innovative technology companies in the world, and it is significant that they chose to do this in the mobile marketing space," said the MMA's Interim CEO and Global Board Chairman Federico Pisani Masomormile earlier this year. "With the investment of solid industry thought leaders, we are expecting consumers in this decade to not only accept advertising on their devices, but embrace it and ask for it. Existing players like Quattro Wireless and market entrants like Apple, who focus on consumer experience, industry best practices and globally accepted guidelines will be leading the race."
 
So is 2010 really the year?
Obviously there are still numerous challenges to overcome before mobile advertising and marketing can fulfill their lofty expectations, but with the pieces slowly falling in place and those with the deep pockets seemingly willing to invest, it appears that success is set to rise.
Tracy Ford and Matt Kapko contributed to this story.

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SHENZHEN, China--As ZTE Corp. pursues smaller carriers to advance its position in the United States, the company is also trying to expand its alliance with Qualcomm Inc. for broadband services on airlines beyond the United States.
Like its sister Chinese network vendor Huawei, ZTE realizes the U.S. marketplace is complex, said Xu Ming, VP, during its annual Global Analyst Conference here last week. ZTE believes smaller carriers – tier-two and tier-three operators – are the best place for the carrier to get a piece of the U.S. wireless carrier business. These operators are small but they have sound business models and their customers have an allegiance to them, he said.
While the U.S. market remains difficult to crack, the Chinese vendor can count quite a bit of success around the rest of the world. ZTE advanced to the No. 5 spot in global handset sales, surpassing Motorola Inc. Secondly, the company's networks business pushed past Alcatel-Lucent to sit at the no. 4 spot worldwide in that business.
"Our wireless business grew more than 100% in each of three last three years," Ming said. While much of that success came from the deployment of 3G equipment in China, substantial gains were made throughout the world, Ming said.
Indeed, the vendor now believes that in the future, there will likely only be three powerhouse infrastructure providers, a theory ZTE calls the Two plus One strategy. Whether it is supplying wireless networks, core networks or wireline equipment, ZXTE believes the top three vendors will be one Western company (think Ericsson) and two Chinese providers (Huawei and ZTE.) The Chinese vendors will be chosen for their prices and the Western supplier will be chosen for its leadership position in the space, as well as its technical expertise. Operators are tired of dealing with a myriad of providers and spending money on interoperability testing, he said.
In developed countries, ZTE has found success by supplying equipment to a major operators "branch" operations, rather than trying to deploy equipment into its core operations initially. In developing countries, the vendor can get in because it can deploy a solution quickly and help the operator with deployment costs, even to the point of helping build the shelter at the tower shelter, said another ZXTE executive.
ZTE had less than 5% of the Chinese market share for 2G CDMA services, but has managed today to gain 35%, even though the vendors supplying equipment remain the same, Ming said.
ZTE has been partnering with Qualcomm Inc. and Aircell to deliver a CDMA EV-DO solution for American Airlines, enabling the airline to offer wireless broadband to its in-flight customers, first deploying the solution in 2008. Ming said the companies are now hoping to expand that business model outside of the United States with other airline providers.

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SHENZHEN, China—While Chinese operators are still working to get more subscribers onto their 3G networks, the world's largest operator, China Mobile Communications Co. Ltd., is trialing a fourth-generation technology called TD-LTE. Once dismissed as an unlikely 4G choice, two recent events are giving the protocol some momentum.
With more than 500 million subscribers, China Mobile's enthusiasm to test TD-LTE has forced equipment manufacturers to commit to building products to the standard because there is simply too much potential to ignore the market segment. Further, chip company Qualcomm Inc. is planning to bid in India's upcoming broadband wireless access licenses with a local Indian partner. If the Qualcomm venture won a 2.3 GHz license, it would deploy a TD-LTE network, giving more credence to the technology.
At ZTE Corp.'s Global Analyst Conference here last week, company executives said there are global opportunities for the technology because there is unpaired spectrum available in many regions that would be well-suited to the technology, including Europe.
The recent hype behind TD-LTE is making WiMAX proponents nervous, said Tony Brown, senior analyst at Informa, during a TD-LTE panel at the conference. WiMAX enthusiasts "view TD-LTE as the bogeyman," Brown said. Indeed, the BWA auction in India for 2.3 GHz licenses, has been a given for WiMAX deployment up until Qualcomm's announcement to bid for the spectrum.
The FDD bands, which require paired spectrum, are overcrowded, said ZTE's Ming Liang, marketing director of ZTE's TDD product line. TD-LTE can use 2.3-2.4 GHz bands, the 2.5-2.6 GHz bands as well as the 2.9 GHz band, he noted. ZTE plans to have equipment available to support the 2.9 GHz band next year, Liang said. The 3GPP standards body is working to incorporate TD-LTE at 2.6 GHz. There is speculation that WiMAX operator Clearwire could use TD-LTE technology at some point, although for now, Clearwire has said it is using WiMAX technology for its go-to-market strategy.
China Mobile is conducting TD-LTE testing in three cities –Quingdao, Nanjing and Xiamen. The operator is testing indoor coverage, seamless handovers and interoperability testing for chip vendors. Chip vendors are testing a dual-mode TD-LTE and FDD-LTE cards for interoperability today, and in the third quarter, field testing should be conducted with commercial versions available in the first quarter of 2011, Liang said. Like other new protocols, dongles will be the first available devices, but Liang said Qualcomm's roadmap calls for embedded devices in 2012.
If China Mobile pushes forward with a TD-LTE deployments soon, that could spur deployments around the rest of the globe because a healthy ecosystem of equipment providers will already be in place, said Dr. Xiaodong Zhu, CTO of ZTE's Europe marketing platform. A combined TD-LTE and FDD-LTE solutions will simplify the technology roadmap, Zhu said. ZTE contends it unified RAN solutions will help operators because they can switch out technologies easily. ZTE, which has WiMAX deployments around the world, said a WiMAX operator may want to deploy that technology initially, and change to TD-LTE if and when it makes sense to do so. The decisions will vary operator by operator, Liang said.

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A few recent developments have made me believe that Cox Communications' wireless offering can be a game changer for the industry. First, I started to watch the TV shows I wanted to watch a few months ago. Second, I watched a Huawei demonstration at CTIA about how the TV remote control can do a lot of fancy things that people often predict a wireless handset can do. Third, I listened to AT&T talk about how its U-Verse customers can program their DVRs from their handsets.

I've always thought Cox certainly had the potential to pick up some wireless customers once it made the $500 million commitment to buy 700 MHz wireless spectrum. I've bought the argument that cable companies need a wireless play to remain relevant in an industry that increasingly offers service bundles to keep customers. But in my own world, I use Qwest for my Internet service and wireline phone service and Comcast for digital cable, and they both do a fine job, but I don't feel any allegiance to either company. The status quo is fine for me. I do feel bound to my wireless provider, but more because of in-network calling between family members than anything else. So I figure Cox's wireless service will appeal to people like my friend Lori, who constantly switches service providers based on the best bundle, or people who are unhappy with their wireless carrier or those who like the idea of a broadband stick for Internet access as part of their bundle. (After using Clearwire's WiMAX service at CTIA, I could easily be part of that group once Denver is built out.) But is that segment of the population enough to make Cox a powerhouse in the markets where it operates? I don't know.

However, a few months ago, we finally broke down and got a DVR. I maintained with four TVs and four people in the house, we watch too much TV anyway, etc. But really I was the one sacrificing my TV time because "The Office" and many of the other shows I like are completely inappropriate for my kids. Thus, if we watch TV together, we are stuck with the likes of "American Idol" and "Dancing with the Stars," or sports or cartoons. More often than not, my husband heads to the basement to watch sports and my son heads upstairs to watch Cartoon Network. Once we got the DVR, it took all of about one minute for everyone to fall in love with it. We rewind, we fast-forward, we record, we erase each other's shows to record our own and we buy movies. For better or worse, the TV is back as the centerpiece of family time many nights at our house because we can all watch "American Idol" as a family, knowing that our other favorite shows are being recorded. AT&T's new ads for U-Verse underscore all of the cool ways you can watch TV these days.

At CTIA's big show last month, Huawei, which is building Cox's CDMA network, demonstrated an offering that lets the TV remote do all sorts of amazing things like share programs with friends, chat with people on your buddy list while watching TV, video call (which I don't get, but some people might like) and a bunch of other stuff that connects the TV, wireless devices and the PC. Huawei was showing the demo to highlight the services that can be offered using LTE and an all-IP core – and for the record did not comment on Cox's plans for the service. But certainly Cox plans to battle in the hyper-competitive wireless space using its strength in TV.

AT&T's U-verse offering makes my DVR service look dated. It can record four shows at once and you can pause a recorded show on one TV and start to watch it on another, among other things. Again, this wouldn't have resonated with me a few months ago, but last night I was peeved I couldn't watch "Dancing with the Stars" while recording "Big Bang Theory," "Life Unexpected" and "Total Drama Island." (It seems everything we like to watch is on at 8 p.m., and nothing is on an hour later.)

Of course, none of this is offered in my market yet, and sticker shock could be a deal breaker, but all other things being equal, the company with the best bundle – whether it's primary business is wireless, cable or something else – will thrive going forward.

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Editor's Note: This article originally appeared in RCR Wireless News' January Special Edition Wireless Infrastructure: The Engine for Economic Recovery. Look for our March Special Edition, coming soon.

With U.S. wireless penetration surging past 90%, wireless carriers are being forced to become more creative in finding ways to continue to grow their subscriber bases.

Recent movements have been made around the prepaid market in an attempt to coax the few remaining consumers who have shied away from wireless services either due to poor credit scores or those averse to signing a contract for service. But, that is only expected to be more of a market share shift amongst carriers than any real increase in customer numbers.

More lucrative efforts have been made around luring customers into acquiring more than one mobile device with PC cards and embedding cellular services into a broader range of consumer electronic devices.

Carriers have also begun to move more aggressively into the machine-to-machine space as a means of generating revenues. While these offerings typically pale in generating revenues with more traditional services, there is often a much lower operating cost associated with M2M that makes the services appealing.

“It's all about carriers being able to monetize their assets,” said Kittur Nagesh, director of worldwide service provider marketing at Cisco Systems Inc. “Whether it's their spectrum assets or their infrastructure assets. That's an important operating pillar for wireless carriers. In the past every bit across the network made money. Now there is almost a negative correlation; the amount of data is exploding and the cost of transmitting those bits is going up, but the revenue generated from those bits is going down.”

A number of operators have announced partnerships with M2M companies looking to tap into a market that is expected to generate billions in revenues worldwide as well as billions more in device and equipment sales. These partners include Kore Telematics, nPhase and Jasper Wireless, among others.

The diversity of such M2M offerings is mind boggling. For years analysts and industry observers talked about embedding wireless technologies into everyday household appliances. That thinking has now exploded into the possibility of embedding wireless technologies into virtually every appliance, machine or device imaginable.

Sufficient support

Some question whether the wireless industry is ready for such an explosion of potential “users.”

“The scale is really unprecedented,” said Nagesh. “If it takes off like I think it will over the next 10 years, the scale could be in the billions of dollars in the U.S., and worldwide could be $50 to $100 billion. Are they ready for that type of scale? Every machine needs to be authenticated. How do you know it's not rogue? There's a huge bombardment on the control plane.”

Nagesh added that while the industry may have the coverage and capacity to handle the current load of voice and data customers, more or less, the thought of millions of “machines” trying to access wireless networks could prove a monumental challenge.

“Many of the verticals that would tap into the wireless network would do so using low-bandwidth applications that would have minimal impact,” Nagesh explained. “However, these could also have a trigger that would allow them to morph into a high performance, high data-rate transmission device. If it's surveillance, it may not transmit anything until someone intrudes into its coverage zone. But once that happens the device may change into a high-definition streaming video mode that would be transmitting live images to an operations center. I'm not sure people have understood this level of impact for M2M.”

One way to handle that impact is for carriers to fortify their networks with next-generation wireless technologies like LTE and WiMAX that use an all-IP core that can more efficiently move bits of traffic over the network compared with today's circuit-switched, packet-data hybrid networks. That is already being done by a number of nationwide operators as well as smaller, regional players.

These networks are expected to allow operators to transmit greater volumes of traffic that could allow for better integration of “bursty” users like M2M equipment.

One downside to current plans are that those networks are not expected to provide the same level of coverage of today's 2G and 3G networks for several years, if ever. This was one of the sticking points to the Federal Communication Commission's plans to auction off 700 MHz public-safety spectrum that would have required the winning bidder to build out a next-generation network with greater coverage than current commercial networks provide.

Deeper challenges

Beyond the basic network challenges, analysts note carriers will need to develop new business models in order to support M2M services. Low recurring revenues must be balanced by low acquisition costs and tempered with a customer base that is very unlikely to churn.

“No one is going to spend $60 per month for grandma to have a wirelessly enabled picture frame in her house,” said Steve Linke, associate director of product development at Verizon Wireless. “We are working on different pricing models to manage this.”

There are also issues of making mobile connections as easy to configure as current wired ones.

ABI Research's Sam Lucero noted that it's 30 times more difficult to arrange a remote connection over cellular than over wired Ethernet. And device self diagnostics need to be improved.

“The industry has to solve this if cellular is to be ubiquitous in the market,” Lucero said.

Lucero also noted that the industry needs to work on standards that will provide those looking to integrate wireless modules into consumer and enterprise customers with some future-proof assurance that their integrated products will continue to be supported.

Despite the numerous challenges, there is little doubt that the M2M space is set for tremendous growth. The biggest question remaining is whether the wireless space is in a position to take advantage of that growth.

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Editor's Note: This article originally appeared in RCR Wireless News' January Special Edition Wireless Infrastructure: The Engine for Economic Recovery. Look for our March Special Edition, coming soon.

Wireless networks are the cornerstone of the wireless industry. These capital-intensive investments are a key building block to the success story that is the wireless communications industry. Networks are key growth drivers to the nation's economy as well. CTIA estimates wireless operators collectively spend about $20 billion a year on their networks, which drives the $75.8 billion in revenue generated nationwide on wireless services for the first six months of the year. The industry association also estimates nearly 246,000 base stations are connecting the nation's wireless networks.

The ecosystem surrounding infrastructure is extensive and includes everything from major telecommunications equipment manufacturers to maintenance grounds keepers at tower sites.

Following is a brief description of the major sub-segments within the wireless infrastructure ecosystem and some of the players that offer products and services in the sector:

Telecom equipment manufacturers/Original equipment manufacturers – These multinational giants build the physical networks using their own equipment and components from a wide range of suppliers. Networks consist of the core and radio access network. Companies in the space include Ericsson, Huawei, Nokia Siemens Networks, Alcatel-Lucent, Motorola, Juniper, Cisco, IBM, Dell, Hewlett-Packard, Fujitsu and ZTE, as well as smaller players including Proxim, Redline, Alvarion, Airvana, Bridgewave and Ciena.

Component suppliers – These companies are a diverse group; some of them offer solutions for certain segments of the network, while others offer products that focus on a specific area. Some of the products they sell are RF components, switches, repeaters, routers, power amplifiers, subsystems, duplexers, antennas and cooling filters. Players in the space include ADC, Commscope/Andrew, Ceragon, Deltanode, Powertel, Rohn, Sabre, Summitek Instruments and Valmont Site Pro 1.

Tower companies – Led by the large tower companies and the carriers themselves, towers are the backbone of the wireless networks. American Tower, Crown Castle International Inc., SBA Communications Corp., Global Tower Partners and TowerCo are the top independent tower firms in this space, but there are hundreds of small and medium-sized tower companies across the country. Besides the traditional outdoor tower sites, distributed antenna networks – that work both indoor and outdoor – are a subsector of this group, as are rooftop towers.

DAS providers – A subset of antenna towers, these distributed antenna systems use a combination of RF and fiber-optic technology to transfer the RF signal in hard-to-site areas, both indoors and outdoors. Players include most of the major tower companies, as well as independent firms like NextG Networks, ExteNet, Mobilitie, NewPath Networks and others.

Service providers – These site acquisition and construction shops manage the actual network buildout for the carriers, working in close contact with the carrier and the sub-contractors. In this space, companies can be one-stop shops or just specialize in certain subsectors of the ecosystem. Indeed, some carriers and infrastructure companies use staffing firms for a variety of positions. Players in the space include BCI Communications, Bechtel, Black & Veatch, Computer Science Corp., General Dynamics, Goodman Networks, KCI Technologies Inc., the Lyle Company, Mann Wireless, MasTec, nsoro, SiteMaster, Smartlink, Tectonic Engineering & Survey Consultants, TEKsystems and TowerSource.

Backhaul providers – Backhaul providers take the signal and route it back to the switching station using fiber Ethernet, microwave and coaxial cable technologies. Players in the space include Redline, Dragonwave, Fujitsu, FiberTower, Level 3 and NEC, as well as local exchange carriers and cable companies.

Cabinets/Enclosures – More than just the physical shelters that house components at the tower site, shelters include climate control systems and power and backup power supplies. Some players in the space include American Products, Accu Air, Adtran, Emerson Network Power, Powerwave and Tessco.

Distributors –These companies help get products out to the field. Some of the companies in this subsector include Hutton, Primus Talley and Tessco.

Telecom Shelters – These shelters house equipment at the site. Some of the companies in this space include - American Products, Fibrebond Corp., Reliant Shelters (a division of mobile Modular Express), Sabre Industries and Tuff Shed.

Tower manufacturers --These companies make the fiberglass and steel structures that house the cell sites. Companies in this space include Caterpillar, Fiberglass Specialties, Fred A. Nudd Corp., FWT Inc., Glen Martin, Rohn, RSI, Sabre, TransAmerican Power Products, Valmont Structures and World Tower Co.

Generators/Power Products – Power is a significant portion of every network and backup power needs are increasingly important during times of crisis, as demonstrated during powerful hurricanes the last few years. Some of the companies that operate in this space include Caterpillar, Cummins Power Products, DC Group, Generac Power Systems Kohler and Jadoo Power.

Lighting – Federal law requires cellular sites to be properly lighted, and it also makes good business sense. Some of the companies in this space include International Tower Lighting, Lighting Flash Technology, an SPX Division, Specialty Tower Lighting, TWR Lighting and Unimar.

Professional services –This group encompasses everything from law firms that represent companies on zoning and land-use laws, as well fixed as site-acquisition and environmental assessment and compliance experts, as well as permitting and utilities coordination experts. Some of the companies in this space include Davis Wright Tremaine, Patton Boggs, Phillips Lytle, Saul Ewing, and Venable, although there are countless businesses that specialize in certain practices and certain geographic regions of the country.

Associations, professional groups -- PCIA represents the infrastructure association and coordinates with state wireless association programs, or SWAPS as well as the DAS Forum. In addition, CTIA, which represents carriers at the national level, also comments on tower issues and the like. The Telecommunications Industry Association represents hardware manufacturers, while the Wireless Communications Association connects wireless broadband initiatives. In addition, certain investment banks and venture capitalists also specialize in the wireless infrastructure space. Media Capital Advisors, RBC Daniels and RBC Capital Markets, Raymond James and Co. and Macquairie also watch the wireless ecosystem. Numerous research companies also cover specialized areas of the technology space, including ABI, IDC and Yankee Group, to name a few.

More from RCR Wireless News' January Special Edition Wireless Infrastructure: The Engine for Economic Recovery

Juniper Networks is set to unveil a trio of mobility solutions under its Project Falcon initiative designed to allow wireless operators to optimize network traffic on their current networks a provide a path for migrating from 3G to 4G technology. The solutions are dubbed Traffic Direct, Media Flow and Mobile Core Evolution.

Juniper said the Traffic Direct offering optimized data traffic by “combining intelligent subscriber and application policies” with its MX 3D series routers “scaling to offload bulk data traffic directly to the Internet.” Juniper added that a study by research firm IDC validated its claims that the solution would lower a carrier’s total cost of ownership by up to 70%.

The Media Flow solution leverages software from Juniper’s partner Ankeena Networks that Juniper said optimizes network transmission of video content and works in conjunction with Traffic Direct to offload network traffic and content delivery “closer to end users.” Both Traffic Direct and Media Flow are scheduled to be available during the second quarter.

The final leg in the offering is the Mobile Core Evolution solution that Juniper said will leverage its MX 3D routers and embedded software from Junos “to deliver 3G and 4G gateway capabilities while accelerating service innovation and time to market with uncompromised scaling across bandwidth, subscribers and services.” The Mobile Core Evolution solution is scheduled to be available to select customers in beta form by the end of the year.

Juniper said pricing for the services will be announced closer to availability.

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Mobile operators realize they need customers to adopt increased data services to offset declining voice revenues but are not sure how to best implement strategies to facilitate that, according to a December survey of nearly 200 senior-level wireless operators, conducted by the Economist Intelligence Unit and sponsored by Innopath Software.

Of the 197 execs interviewed, 44% said they think data revenues will offset declining voice revenues in the next five years. Further, the survey said operators realize that open networks are the future, which means sharing revenues with content providers. Operators also are counting on advanced networks to contain operating costs, but 58% said usage-based pricing would help ensure profitability.

“Operators recognise the challenge posed by non-traditional service providers such as Skype and Google, but they have not yet clearly defined their strategies for making their mobile data businesses more competitive,” says Katherine Dorr Abreu, senior editor at the Economist Intelligence Unit.

Innopath, which offers customer relationship management services to global operators, conducted the survey in part to help introduce three enhancements the company is making to its ActiveCare CRM solution.

With roots in over-the-air firmware updates, Innopath is adding more support for smartphones, which are the fastest-growing segment of handsets. Smartphones generate more revenue for carriers, but often require operators to spend more time on customer care for smartphone users because the devices are more complicated, said Dave Ginsburg, VP of marketing at Innopath. Smartphone support can cost four times that of feature phone support, Innopath estimates.

Despite all of the efforts to push customer care to more automated responses, the majority of customers (72%) still prefer a live agent, which can be costly if that agent keeps having to move the customer up the CRM support chain. Google Inc.’s lack of live agent support for its Nexus One smartphone when it first came to market validates the need for live agents, said Ginsberg. Google is implementing live customer support to address the criticism.

Innopath said the latest version of its ActiveCare platform offers universal device support for Android, Symbian, RIM and Windows Mobile operating systems today, and will be available on the Apple OS by the end of June. The Frontline Care software enables less-sophisticated customer care representatives the ability to see what is wrong with the handset, thus reducing average call times. The solution also works on feature phones that use the BREW platform. Innopath can show a return on investment for the solution within six to 12 months, Ginsburg said.

The second feature Innopath is introducing on its ActiveCare platform is called Mobile Update 2, which offers enhancements to both the client and the server that enable better performance with large update packages and scalability. As smartphone manufacturers continue to update their OSes and fix bugs in the system, this solution allows carriers to perform those updates and fixes remotely on a large scale.

Finally, the third enhancement is called Mobile Activate. Already deployed with Tata DoCoMo in India, it ensures that the device is working properly when the customer first turns it on – what Innopath calls the ‘golden hour.’ Tata DoCoMo turned on its network in June and already counts 25 million subscribers, Ginsburg said. Mobile Activate detects which device is trying to connect to the network and then configures the phone to make sure it is enabled for all of the features and services it is capable of doing, Ginsburg said.

Innopath supports Verizon Wireless, AT&T Mobility and other tier-one operators.

More from RCR Wireless News

With the wireless industry increasingly focused on the deployment of advanced wireless data services, network management capabilities are becoming an integral part of network deployments. Spectrum constraints combined with consumer demand require almost mandatory management solutions in order to keep both the network and customers happy.

To that end, computing pioneer IBM Corp.’s Tivoli software division is looking to increase its presence in the management of network operations. In late 2005, IBM acquired network management provider Micromuse, and in early 2007 completed its acquisition of network monitoring provider Vallent Corp. Both operations were folded into IBM’s Tivoli division in an attempt to bolster Tivoli’s end-to-end proposition to customers.

Those customers include telecom operators looking for a hosted solution directly from IBM or through a white-label agreement with partners like Alcatel-Lucent, Motorola Inc. or Huawei Electronics Co. Ltd.

The acquisitions of Micromuse and Vallent gave us the ability to provide management services covering everything outside the data center, and with Tivoli we can manage that data center,” said Kieran Moynihan, VP and CTO of Telecoms at Tivoli. “Now we can offer the entire package.”

While past management solutions focused on tracking the quality of voice traffic over mobile networks, the so-called “blocks and drops,” Moynihan said carriers are being forced to shift much of their analysis over to the data part of their networks as traffic-heavy devices and applications come online.

However, one challenge Tivoli sees with current network management and monitoring equipment is the ability to process the amount of information coming in from the network. This is one area Tivoli thinks IBM’s history in the computing space is paying off.

“The biggest challenge for carrriers is that too much information is coming in, and there is not enough processing power process it,” Moynihan said. “This is an advantage for us as IBM has that kind of track record in crunching that volume of data. Also it’s important to process the information in a quick enough time frame to make it actionable for the carrier. There is no use in knowing there is a traffic problem at a cell site if that information does not reach the right people in time.”

Battle for the home

Another area Tivoli is looking to spread its monitoring wings is at the edge of the network, and more specifically in devices and in-home network extensions. Moynihan explained that by extending network monitoring capabilities beyond the core, carriers could save money on network diagnostics.

“We are seeing increased calls from fixed and broadband customers saying their networks are not working,” Moynihan said. “After spending the time to diagnose the problem we are realizing it’s a home IT problem, not a problem with the fiber to the home. These diagnostic sessions cost a lot of money for the telco’s. A future trend we see is in providing capabilities to monitor a customer’s network from their home.”

Moynihan said that one way of doing this would be to install software on a smartphone that would allow a telco so see exactly the problem a customer is describing from their point of view. Another solution would be to have monitoring software installed on a femotcell or router in a home that would allow the same level monitoring from the consumers perspective.

“The battle ground of the future will be for control over the home,” Moynihan said.

These solutions are only part of the package Tivoli hopes to use as it attempts to gain a greater share of the network monitoring business. And with wireless carriers set to unveil more advanced mobile networks capable of supporting increased data usage, and customers looking to take advantage of the additional capacity, the market for that business looks set for robust growth.

More from RCR Wireless News

As speculation mounts that Leap Wireless International Inc. has hired advisers to explore a potential sale or merger of the company, look for international operators to be interested in the property.

Leap stock was up 13% Monday after the Wall Street Journal reported that the company is once again exploring its merger options. The stock was down a few points on Tuesday. While conventional wisdom has Leap teaming with MetroPCS Communications Inc. because those two companies previously talked about combining, but that may be unlikely after a 2007 merger attempt failed. Likewise, Verizon Wireless and AT&T Mobility are often mentioned as likely partners, but both carriers would face increased scrutiny from federal regulators who already worry too much that the nation's No. 1 and No. 2 operators wield too much power in the marketplace.

The Leap-MetroPCS rumors pop up every few months, although this speculation appears different in that news outlets are going so far as to name the advisers hired. In the past, carriers have been known to watch Wall Street's reaction to potential tieups to see how the Street responds to the news.

Deutsche Telekom and SK Telecom both have shown their interest in the U.S. marketplace; DT owns T-Mobile USA Inc., the nation's fourth-largest wireless operator. Speculation heightened last fall that DT was interested in increasing its presence in the U.S. by buying Sprint Nextel Corp. T-Mobile and Leap use different technologies, which may have dampened DT's interest Sprint Nextel and likely would be a factor in weighing a purchase of Leap.

Despite its writeoff of the failed Helio venture, SK Telecom reportedly is still interested in a U.S. wireless play. SK Telecom issued a statement in 2008 that it was not interested in acquiring Sprint Nextel following weeks of rumors the two companies were in talks.

Leap is set to release its fourth-quarter and full-year 2009 results Feb. 25. The flat-rate carrier is under increased pressure as larger rivals step up their efforts in the prepaid space. Verizon Wireless, for its part, noted it gained 1 million of its 2.2 million net additions in the fourth quarter from its resale channels, which include America Movil subsidiary Tracfone. Verizon Wireless, AT&T Mobility and regional carrier U.S. Cellular Corp. all introduced unlimited voice calling plans for $70 per month earlier this year. Those calling plans could lure customers away from Leap and MetroPCS, which both offer similar calling plans that include data and text messaging for around $60 per month.

More from RCR Wireless News

RCR Wireless News is pleased to announce its Special Edition, “Wireless Infrastructure – The Engine for Economic Recovery,” is now available. This 72-page, four-color special edition includes feature articles on employment in the wireless infrastructure sector, what 4G rollouts mean to the large and smaller U.S. wireless operators, as well as the global community, as well as analyst analysis and Opinion, StockWatch, Ecosystem, Metrics, RCR Local and other regular features that RCR Wireless News readers have come to love.

To view the digital edition online, click here.

To subscribe to the print special edition, click here.

More from RCR Wireless News

Bell Labs launched an aggressive green campaign today, forming a consortium that aims to decrease the communication industry's energy use by a factor of 1,000. The initiative will entail demonstrating enablling technologies that ultimately require entirely new networks that focus on power efficiency from the ground up, according to Gee Rittenhouse, vice president of research at Bell Labs and consortium lead.

The Green Touch initiative includes members from academia, industrial labs, nonprofit and governments, as well as operators. Its goal is to demonstrate the enabling technologies that are needed to build such a network within five years. The consortium will produce basic research, but not build products.

“The ICT industry has enabled tremendous amount of economic growth,” noted Rittenhouse. But along with that growth comes increased carbon emissions as the networks grow and more people connect to them, consuming more data. “We know if we apply all of the things we are working on today, at best we can hold CO2 emissions flat for the next decade. That's not acceptable.”

Bell Labs research found that theoretically energy consumption could be decreased by a factor of 10,000. Building such networks will be incredibly complex, but the research facility believes that setting the goal to be a 1,000-fold reduction is still aiming extremely high but is an attainable goal. For comparison, a 1,000-fold reduction is roughly equivalent to being able to power the world's communications networks, including the Internet, for three years using the same amount of energy that it takes to run them for a single day. Another example is reducing the energy consumption by a factor of 1,000 is the equivalent of taking 40 million automobiles off the road. “This is not about tweaking base stations and routers. … This effort really pushes the boundaries.”

While Rittenouse said it was premature to start estimating a return on investment for building more energy-efficient networks, he said power consumption will continue to increase as an expense cost as energy costs increase and as networks consume more energy because more people are connected to the network. Further, most of an operator's energy use is in operating the network, not manufacturing network products.

The group's first meeting is set for February to set short-term goals for one-year deliverables as well as longer term goals. Funding for the consortium is expected to come from a variety of areas.

Initial members

Founding members include:

Service Providers: AT&T, China Mobile, Portugal Telecom, Swisscom, Telefonica

Academic Research Labs: The Massachusetts Institute of Technology's (MIT) Research Laboratory for Electronics (RLE), Stanford University's Wireless Systems Lab (WSL) and the University of Melbourne's Institute for a Broadband-Enabled Society (IBES); Government and nonprofit research institutions: The CEA-LETI Applied Research Institute for Microelectronics (Grenoble, France), imec (Headquarters: Leuven, Belgium), and The French National Institute for Research in Computer Science and Control (INRIA);

Industrial labs: Alcatel-Lucent Bell Labs, Samsung Advanced Institute of Technology (SAIT) and Freescale Semiconductor.

More from RCR Wireless News

Take the RCR Wireless News Survey today and be automatically registered for a drawing to win a free RCR Wireless News Lead Generation Program (Webinar, sponsored content and sponsored newsletter to over 100,000 subscribers).  This is a limited time offer and is available to employers only.  RCR Wireless News, the leading wireless industry magazine is now part of Arden Media Company (www.ardenmediaco.com).

http://tinyurl.com/RCR-Wireless-News-Survey

Don't forget to discover your strengths today -- www.telecomcareers.talentmine.com. 

Follow us on twitter @telecomcareers

Are you ready for LTE?

Freescale Semiconductor

Do you remember the first time you got your hands on one of the next-generation smartphones that combines email, wireless web browsing and traditional phone functionality? For many, this was an impressive experience. Now consider the prospect of using such a device with Internet connectivity speeds as fast as today’s broadband-enabled desktop.

The appeal of this kind of performance in the context of today’s mobile devices is compelling. But that’s only part of the story. The fact is, next-generation mobile broadband technology is on the horizon and approaching fast. As a result, consumers can look forward to more than just faster internet connectivity on their existing mobile devices – they can expect performance levels that enable creation of entirely new classes of mobile products and services that dramatically boost productivity, improve public safety and enhance enjoyment of digital entertainment.

Long-Term Evolution (LTE) is one of the leading wireless standard candidates expected to deliver this kind of game-changing performance. But the technology presents more than just attractive user experiences – it also represents a huge business opportunity for the service providers, equipment manufacturers and semiconductor suppliers who bring LTE to life. Leading mobile carriers and service providers worldwide are currently working to complete the buildout of networks capable of supporting LTE. Carriers in Asia are expected to begin offering commercial LTE service as soon as late 2009, and firms serving North America and Europe are not far behind.

Although different configurations of LTE are planned for deployment in specific global regions, all LTE variants are expected to ultimately deliver speeds of up to 326Mb/s downlink and 86Mb/s uplink, and support channel bandwidths from 1.25 MHz to 20 MHz. LTE is expected to deliver this kind of performance in large part because it is designed to provide as much as four times the spectral efficiency of networks based on previous wireless generations. This allows LTE networks to deliver more bits of data into the same amount of spectrum as older standards, resulting in faster data speeds and increased capacity. And LTE provides this higher bandwidth while reusing existing spectrum that is being used by current-generation networks.

LTE is based on a simplified, all-IP network architecture that boosts the volume of data that can travel across a network and enhances network efficiency. This increased efficiency is especially appealing to network operators, who expect LTE to lower operating and capital expenditure costs, since the simplified architecture requires fewer (but more integrated) infrastructure equipment installations.

Greater flexibility is another benefit of LTE. With LTE, network operators can operate within a broader range of frequency bands, as well as deliver connectivity across smaller amounts of spectrum in cases where a particular usage model might require lower bandwidth.

The potential of LTE is significant for consumers, as well as for the telecommunications industry and its entire supply chain. In the years ahead, LTE promises tremendous opportunities for the people and organizations best able to harness the promise of this compelling technology.

 

Hats off to TXWA for selling out the May 14th event.

LFC, Inc. is championing the Texas State Wireless Association Annual Charity Golf Tournament on May 14.  LFC and TXWA are pleased to announce that the tournament has sold out!  Brandt Dozier, President of LFC and Nicole Andrepont, VP -Operations of LFC, worked closely with Dave Harris, Vice President of TXWA, to plan this successful event.  The tournament will be held at Tour 18 in Houston, Texas.  The generous donations and sponsorships made by the wireless community will benefit two charities,  the Keith Harris Scholarship fund and the DeafBlind Children’s Fund. 

LFC, Inc. is a Site Development and Engineering Firm located in Houston, Texas.  LFC offers Site Acquisition, Project Management, A&E Services, Structural Engineering, as well as other regulatory services that support site development, to Wireless Carriers across the nation. 

For more information about the event please contact:

www.txwa.org - David Harris (dharris@talleycom.com)

www.LFC-inc.com (nicole@lfc-inc.com)

http://tinyurl.com/VA-Rural-Broadband

On Friday morning, I met with an old friend, Dr. Ted Rappaport, to learn more about his latest great adventure, while on sabbatical from UT.  He spent the past year in Virginia working with Virginia's CIO and Governor's office creating and then implementing Virginia's rural broadband initiative, which has become a model for Obama's rural broadband stimulus package.  Please see http://tinyurl.com/VA-Rural-Broadband for more information on the initiative.

For more information about Dr. Rappaport, please see http://www.wncg.org/.  Professor Ted Rappaport has been selected as one of two winners of The Institute of Electrical and Electronics Engineers (IEEE) 2008 Wireless Communications Recognition Award.

The Wireless Networking & Communications Group (WNCG) is an interdisciplinary center for research and education at The University of Texas at Austin with an emphasis on industrial relevance.

Mission:

- To create a collaborative environment which supports basic research and promotes technical innovation, imagination and entrepreneurship in wireless networking and communications and applications thereof.

- To provide a highly relevant education and opportunities for students wishing to pursue careers in wireless networking, communications and related areas.

WNCG has an exceptional track record fostering collaborations with and among industry. We seek to serve industry by creating and disseminating knowledge about wireless networks and communications through research, teaching and technology transfer. As such, a primary source of sponsorship for WNCG is our Industrial Affiliates program – this includes leading wireless, software, and semiconductor companies who take an active role in our research program. This website serves as the focal point for WNCG’s research, events, and the wireless movement in Austin.

Organization

WNCG Director, Jeff Andrews, currently manages the operational aspects of the center, which includes 14 faculty from Electrical and Computer Engineering and Computer Sciences at U.T. Austin and over 80 graduates and undergraduates as well as research scientists, post doctoral and industry visitors. Dr. Robert Heath is the Associate Director.

WNCG was founded in 2002 by Ted Rappaport and a number of faculty at The University of Texas. He served as Director until December 2005 and remains the Founding Director and active member of the group.

Please let us know what you miss the most about RCR Wireless?

By Marguerite Reardon CNET News. Posted on ZDNet News: Mar 31, 2009 6:56:56 AM

We've barely unpacked our bags from GSMA Mobile World Congress in Barcelona in February, and we're on the road again to Las Vegas for CTIA Wireless, the U.S. tradeshow and conference held every spring where the biggest and most influential players in the U.S. mobile market gather.

While there will be some cell phones announced at this year's show, most of the excitement will center on software applications and the virtual store fronts that are popping up to distribute these new applications. Since the success of Apple's App Store, which provides easy access to third party applications for iPhones, other companies have jumped on the bandwagon announcing their own application stores.

CTIA Wireless 2009
Everyone from Google to Microsoft to Nokia to Research In Motion has announced plans for a new application store. And at this year's CTIA, some of these new app stores will come to life. RIM is expected to announce that its BlackBerry AppWorld is open for business and Microsoft will start showing off its Marketplace for the first time.

See also: Special Report: CTIA Wireless 2009

But application markets aren't the only thing that will be talked about. Carriers, like Verizon and Clearwire will also be touting faster broadband wireless networks that will help make these applications a reality. And of course handset makers will be showing off new products, some of which have already been announced, such as the Palm Pre.

But this year's spring CTIA Wireless show will likely be smaller than in years past. The economic downturn has taken its toll on the mobile market. Even Nokia, the world's largest and strongest maker of cell phones, has slashed expectations for 2009. And the company has already begun laying off employees and closing facilities to cut costs.

Still, mobile is hot. And most experts agree that even though the overall cell phone market won't grow as quickly as it has in years past, it is one of the brightest spots on the technology landscape for the future. And the new technologies and services developed and shown off today will pave the way toward recovery in the future.

Here's a snapshot of what we expect to see:

Applications galore
The biggest news of the week will likely come from Research in Motion. The company, which makes the popular BlackBerry smartphone, is expected to introduce both an applications storefront and a mobile video-download service for its newer BlackBerry devices. RIM, the preferred smartphone of the suit-and-tie crowd, has increasingly courted consumers over the past year with new phones like the Pearl and the Storm. But throwing the BlackBerry wide-open to consumer-oriented developers could help enhance its standing against Apple's iPhone.

Microsoft is also expected to show off its Windows Marketplace for Mobile, its version of the mobile computing application store. Microsoft announced the new mobile application store at Mobile World Congress in February. And now it plans to show off the product at the show with a special demonstration during a keynote address on Thursday.

Last year, the company unveiled Windows Mobile 6.1 in Las Vegas, and it announced tweaks to the software at MWC earlier this year with Windows Mobile 6.5. But the broader overhaul of the software promised in Windows Mobile 7 still appears pretty far off in the distance.

Even though Apple won't be at CTIA, there will be plenty of iPhone applications announced and demonstrated at the show. Skype has already taken the wraps off its new Skype for iPhone app. And other apps are sure to be highlighted and demonstrated, such as MobiTV's new iPhone application.

Networks: The faster, the better
Even though carriers are still finding ways to monetize their newly built 3G wireless networks, they're already looking toward the future. Verizon chairman and CEO Ivan Seidenberg will take the stage on Wednesday, and he's expected to tout the company's impending 4G wireless network and the billions of dollars it's invested in its fiber optic landline network. Verizon's CTO Dick Lynch dished some of the details on the new 4G network, which is expected to launch in 2010, in Barcelona last month.

Benjamin Wolff, co-chairman of Clearwire is also taking the stage this week at CTIA. Clearwire, which is using wireless assets from Sprint Nextel, to build a 4G nationwide network using WiMax technology is also expected to talk more about the its plans to provide wireless broadband coverage to 120 million people by the end of 2010.

Robert Dotson, CEO of T-Mobile USA, the smallest of the four major cell phone operators, will also be delivering a keynote speech on Wednesday that is likely to provide an update on the company's roll out of its 3G network. And AT&T's head of wireless Ralph De La Vega will meet with reporters on Thursday. While it's not yet known what he will talk about, there could be an update on the company's technology upgrade to a faster network. Last year, De La Vega said AT&T would be offering network speeds of 20 Mbps over its current network infrastructure as it upgrades to newer versions of HSPA.

Handsets revisited
Rumors are building that Google's Android group might try to steal a little of the CTIA thunder, in partnership with HTC. HTC built the first Android phone, the T-Mobile G1, and has committed to releasing additional phones. One of those might be arriving soon, especially now that the HTC Magic has passed the FCC's certification tests, and could be announced this week. HTC announced the Magic for European markets at Mobile World Congress in February. Perhaps a new Android phone will be announced by T-Mobile's Dotson on Wednesday during his keynote speech.

Smartphone maker Palm is not attending CTIA, but the company's hotly anticipated phone the Palm Pre, which was announced in Las Vegas at CES in January, will be at Sprint Nextel's special "lounge," where the carrier will be showing off the device to press and a few other special guests.

Details on pricing and availability aren't expected at the show, but Palm fans are crossing their fingers for some news. The company could have something to say on Wednesday, when Palm's Michael Abbott will make an appearance at the Web 2.0 Expo in San Francisco.

AT&T will also be showing off six new handsets for its network that are geared toward data centric consumers. These devices offer an array of devices with full keypads and touch screens. These phones include models from LG and three from Samsung, such as the Propel Pro. AT&T is also going to be offering Nokia's ultra-thin E71x, which is very popular in Europe. This is one of the first high-end Nokia devices available in the U.S. market and could help Nokia build a bigger toe-hold in the U.S. market.

This article was originally posted on CNET News.

For those of you planning to attend the IWCE conference in March, we thought we would pass along this information we received from PCIA.....PCIA Members Receive 25% off the Premium Package, 3 Day Option, or FREE Exhibit Hall Admission! Use Code H29 when registering to receive the discounts!The IWCE conference program delivers content that is informative and relevant, creates dialog and is on the cutting edge of the integrated communications technology industry.IWCE offers traditional sessions...

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