The end of the year came early for AT&T Wireless Services Inc. as the carrier made good on its often-repeated plans to offer high-speed wireless data services before the calendar turned over as it launched what it termed commercial UMTS services in four markets with plans to add two more markets by the end of the year.
The carrier said the service would provide customers in Detroit, Phoenix, San Francisco and Seattle, and later this year in Dallas and San Diego, with network download speeds of between 220 and 320 kilobits per second and uplink speeds up to 64 kbps.
AWS Chairman and Chief Executive Officer John Zeglis noted the network launch was the culmination of AWS’ long-standing relationship with Japanese telecom giant NTT DoCoMo Inc., which made a significant financial investment in AWS in late 2000. That relationship is expected to end pending AWS’ acquisition by Cingular Wireless L.L.C. AT&T Wireless also made good on a $200 million network agreement with Nortel Networks Ltd. to deploy the service using 1.9 GHz spectrum.
In addition to beating its UMTS launch deadline, the announcement propelled AWS ahead of competitors Verizon Wireless and Nextel Communications Inc. in the race to deploy high-speed data services. Verizon has launched CDMA2000 1x EV-DO in two markets and Nextel is using Flarion Technologies-based Flash-OFDM service in portions of North Carolina.
(Some analysts note that the AWS launch should actually be termed a W-CDMA launch as the UMTS standard was reserved for technology launched in the 2.1 GHz spectrum bands being used in Europe and AWS is using its 1.9 GHz frequencies for its service.)
Cingular said it plans to begin testing a similar high-speed data service later this year in Atlanta with plans to begin rolling out commercial deployments in 2006. Meanwhile, Sprint PCS recently announced it would begin deploying EV-DO technology later this year and, like Verizon Wireless, have nearly its entire network covered by the end of 2005. T-Mobile USA Inc. has yet to announce migration plans beyond EDGE.
“By announcing that it already has an active 3G network, [AWS] will be able to take some of the marketing sting out of similar 3G launches from both Verizon Wireless and Sprint, especially considering that W-CDMA is a true voice and data 3G technology where 1x EV-DO is purely for wireless data,” Current Analysis wrote in a research note.
AWS also trumped its competitors in the number of devices customers can choose from to access the network, launching the service with a pair of $300 handsets from Motorola Inc. and Nokia Corp. and a PC Card developed by Lucent Technologies Inc. and Novatel Wireless Inc. By comparison, Verizon is providing a single PC card for its EV-DO network, while Nextel is offering a PC card/desktop modem. The Motorola A845 handset supports GSM/GPRS services in the 850 MHz spectrum bands, while the Nokia 6651 handset and Novatel Merlin U520 PC card only support GSM/GPRS in the 1900 MHz spectrum bands.
The devices are admittedly bulky, but are expected to come down in size and price as carriers continue to roll out 3G networks around the world.
AWS is providing a tiered pricing structure for the network, allowing customers accessing what it called “enhanced mMode” from a handset for unlimited data transmission for $25 per month on top of GSM voice plans available today, or the same $80 per month for unlimited data using a PC Card that the carrier charges for its GPRS and EDGE services. AWS also announced plans to provide streaming video and audio content from Real Networks for $5 per month in addition to other applications designed to take advantage of the network’s higher throughput. However, the Motorola device is the only handset to support true streaming services at this point.
While AWS’ is promoting network speeds up to 384 kbps, RBC Capital Markets found the network provided average data speeds of around 230 kilobits per second in the San Francisco area using the PC card, which fell short of the 800 kbps RBC attained when testing Nextel’s Flarion-based service in North Carolina and the 400 kbps from Verizon Wireless’ EV-DO network. Testing did show that the new service surpassed the 110 kbps provided by AWS’ EDGE network as well as the 100 kbps of Sprint PCS’ 1x network.
RBC analysts Jonathan Atkin said the service provided network speeds that were in line with expectations and comparable to “the low-end of broadband,” and that the network speeds were enough to support streaming services.
RBC also noted that it measured between 350 and 400 milliseconds of network latency on AWS’ network, compared with between 30 and 40 milliseconds from Nextel’s Flarion service; between 250 and 300 milliseconds from Verizon Wireless’ EV-DO network; and roughly comparable to the 300 to 400 milliseconds recorded from Sprint PCS’ 1x network.
AWS downplayed the speed difference between its offering and Verizon Wireless’ EV-DO service, noting consumers would not likely notice the difference in most instances.
“Their published speeds are faster, but we feel the user experience will be similar,” said Rod Nelson, AWS’ chief technology officer.
An AWS spokesman also noted that its service’s ability to support both voice and data simultaneously would prove to be a compelling competitive advantage over its competitors data-only solutions.
While most analysts were positive about the network launch, some expressed concern regarding potential coverage issues that plagued AWS’ initial GSM/GPRS launch as well as the current devices’ inability to “fall-back” onto the carrier’s seemingly robust and extensive EDGE network.
“Why would corporate users sacrifice national data coverage speeds of 100 to 115 kbps to gain 220 to 320 kbps access in just four markets only to find themselves running at more mundane 40 kbps GPRS speeds the rest of the time?” Current Analysis asked.
AWS countered that the initial launched markets were selected because they were well covered with 1.9 GHz towers and the carrier had enough spectrum to support the minimum of 5 megahertz of clean spectrum required for the technology, and that its GPRS network would prove to be an adequate back-up until EDGE-compatible devices become available.
Cingular, which has often lagged behind its competitors in launching spectrum-hungry data applications due to its relatively modest spectrum portfolio, used the AWS launch as further evidence that the government should quickly approve its pending acquisition of AWS as only the combined spectrum assets of both companies could support a nationwide rollout of high-speed data services while still supporting current technologies. Cingular submitted a filing to the government earlier this year explaining it would need up to 80 megahertz of spectrum to support the rollout of both high-speed data and continued support of the more than 45 million current Cingular and AWS wireless customers.
“The additional spectrum, capability and reach that Cingular will gain from the merger will allow us to introduce competitive alternatives where they have not existed before,” Cingular said.
