The Story of 2009 Will Be 3G

Amid a Smartphone Explosion, WiMAX, LTE Set to Square Off, But HSPA Is Here Now

Is the coming 4G smackdown between LTE and WiMAX the biggest development in wireless broadband? Probably not, but it’s getting a lot of press. The real story is how the 3G business model will change in 2009.

4G does seem like a big story on the face: Verizon Wireless says it is accelerating its schedule for the rollout of the 4G technology known as LTE (now launching late 2009), and the final spec for that is finally frozen. There’s also the ongoing WiMAX build-out from Sprint-Nextel Corp. and Clearwire Corp., which have added a combo 3G/WiMAX modem to spike subscriber uptake.

Here’s the problem: That dual-mode modem is a must to sweeten the deal for subscribers because the WiMAX footprint is spotty to say the least. Clearwire had promised us 30 markets by the end of the year; but we’ve gotten one, Baltimore. And there are rumors that the WiMAX rollout will be delayed further because funding is hard to find these days. And Verizon can aim for 2009 to get its LTE network started, but commercial LTE devices will likely not show until 2010. In all, it looks as though 2010 is shaping up to be the Year of 4G, not 2009.

And what happens in the meantime? A rash of development, especially in HSPA, that has the power to make 4G a bit irrelevant for the next 12 months, that’s what.

“Three things — devices, network and business model changes — are without question the sweet spot of what's going on and what will go on,” explained Glenn Lurie, head of AT&T Inc.’s emerging devices unit. “We’re talking about the network that has the capabilities to run those apps and devices in the way customers expect them to run and act ― and they're here, now.”

A Few Drivers

The evidence for 3G being the story in 2009? It boils down to Lurie’s aforementioned perfect storm of faster networks, connected devices coming to market and third-party development ecosystems. A look at 2008 provides the clues for 2009.

There’s no question that smartphones have captured the hearts and minds of consumers in the second half of 2008, with sales continuing with double-digit growth despite the downturn. And consulting firm Ovum Ltd. points out that the North American market had “stunning growth” in mobile data services for 2008, which should continue into 2009, even if it proves to be less than what was anticipated 12 months ago. AT&T, it says, grew data revenue by 51 percent and Verizon by 43 percent. Meanwhile there’s no question wireline is suffering: AT&T lost 400,000 landlines in the fourth quarter.

Perhaps more telling, J. Gold and Associates predicts that over the next three years, business deployment of smartphone devices will increase at a rate four times greater than that of notebooks, and business applications deployed to smartphone devices will grow at twice the rate of those deployed to notebooks.

Share this article: Email, Slashdot, Digg, Del.icio.us, Yahoo!MyWeb, Windows Live Favorites, Furl
Add this article feed to: RSS, My Yahoo, Newsgator, Bloglines

Read Comments [1]