VERIZON WIRELESS AND VODAFONE GROUP PLC will move toward a common network technology path for their respective networks and specifically mentioned the use of LTE technology without a formal commitment to that choice, according to remarks by company executives last week.
Arun Sarin, CEO of Vodafone, and Verizon Communications Inc. chairman and CEO Ivan Seidenberg spoke about the technology choice at the Goldman Sachs Communacopia conference. Vodafone and Verizon control Verizon Wireless through a joint venture.
Reuters quoted Sarin as saying that “It makes complete sense for us to go from HSDPA to LTE and it makes sense for Verizon to go from EV-DO to LTE.” Sarin estimated that it would probably be three to four years before it would be possible to start using LTE. The LTE standard is not yet complete.
Common goals
“Going through a common platform is nothing more than the industry realizing that we can stimulate expansive growth by having a common platform and having the best networks,” said Seidenberg, according to Verizon’s transcript of his remarks. “So this LTE thing plays out probably over five or six or seven years. It plays out over time.”
“We were pleased that they have looked at this just to complete the issue with Vodafone,” Seidenberg added. “We have very good operating relationships with them right now.”
Vodafone relies on GSM- and HSPA-based technology for wireless high-speed data access in its properties abroad, while Verizon Wireless-45% owned by Vodafone-is a CDMA operator that is in the midst of upgrading its network to EV-DO Revision A technology.
“If convergence was going to take place between Vodafone and Verizon, this is the time where it was going to take place,” said to Current Analysis analyst Peter Jarich, explaining that there is a wider break between 3G and the next generation than between 2G and 3G.
Jarich said that a common, shared network path for Verizon Wireless and Vodafone seems like an obvious choice, given the advantages of international roaming capabilities as well as the scale they would enjoy in everything from infrastructure purchases to devices.
“You just can’t argue with the benefits of that,” he said.
With scale helping to drive down costs, Jarich added, it also becomes easier to get devices into customers’ hands more quickly and drive early adoption.
Asked if the complementary network evolution was reflective of cementing a long-term relationship between the two companies, Seidenberg called the categorization fair and said that Verizon has looked for stability in its relationship with Vodafone. As penetration rates slow, he added, common networks offer a new avenue for growth.
Other options
While the CEOs of both companies specifically spoke of LTE, it wasn’t the only next-generation technology mentioned. Seidenberg also spoke of ongoing WiMAX trials in partnership with Vodafone. However, mention of the CDMA network evolution path-including EV-DO Revision B and Ultra Mobile Broadband-was conspicuously absent.
Verizon Wireless spokesman Jeffrey Nelson emphasized that the company is “working closely with Vodafone for next-generation technology. We have not made a technology decision.”
Perry LaForge, executive director of the CDMA Development Group, said he also did not see the discussion of LTE as a definitive discussion of Verizon Wireless’ technology path, and noted that the company has a continued focus on CDMA and its new EV-DO Revision A network.
“I think some of this was just sort of . thinking about what might be possible, as opposed to announcements,” LaForge said. “With regards to any decision or impact, I think it’s really too early to tell.”
He added that the UMB standard is further along than that of LTE. LaForge also said that he expects to see a greater degree of interoperability in the next generation of technology overall. Conversations about next-generation technology choices, he said, would probably ramp up in the next six to nine months, but for now operators are largely focused on their existing networks.
If Verizon Wireless ultimately goes with LTE, it would mark a serious setback for CDMA backers, as Verizon Wireless is one of the world’s largest supporters of the technology.
