Wireless

Comcast is getting into the wireless broadband business by bundling Clearwire's 4G wireless service with its existing broadband products.

The largest cable operator in the U.S. will launch the new service in Portland, Ore. And it will expand the service to other Comcast cities later in the year, including Atlanta, Chicago, and Philadelphia.

(Credit: Comcast)

Comcast invested in the new Clearwire in 2008, along with Google, Intel, Time Warner Cable, and Sprint Nextel, which gave Clearwire its 2.5GHz spectrum. Clearwire's plan has been to roll out its service nationwide. The service is now up and running in a few cities, including Atlanta, Baltimore, and Portland, Ore. And the company has plans to roll it out to 80 markets by the end of the year.

Some of the cities where it plans to launch the service include, Las Vegas, Chicago, Charlotte, N.C., Dallas/Ft. Worth, Honolulu, Philadelphia, and Seattle. And it plans to launch the network in cities such as New York, Boston, Washington, D.C., Houston, and the San Francisco Bay Area, in 2010.

Clearwire is using a technology called WiMax, which offers faster speeds than current 3G wireless technologies, but offers wider coverage than other high-speed wireless technologies such as Wi-Fi. Clearwire claims that it can provide up to 4Mbps for downloads and 500 kbps for uploading, which is more than double what consumers can expect using a 3G wireless connection.

Comcast will be selling 4G wireless access as part of an Internet bundle to Comcast subscribers. To entice new subscribers, Comcast is offering the new 4G wireless with its 12 Mbps download cable modem service, plus a free 802.11g router for $50 a month for the first 12 months.

The data card used for the 4G wireless, which fits into a laptop, costs $99. But subscribers who sign up for the package with a two-year commitment get the data card for free.

After the first 12 months, subscribers will then pay $43 per month for the 12 Mbps broadband service and $30 extra per month for 4G wireless service. The 4G wireless service is only available in Comcast's cable territory, but subscribers who travel to other cities where Clearwire's network is operational will be able to access the network at no additional cost.

New customers signing up for Comcast's triple play bundle of TV, phone, and Internet can add the 4G wireless component for $30 extra a month. So with the introductory price of $99 a month for the first year, the total would be $130 a month. After the first year, that bundle increases to $130 per month, so it would cost subscribers with the 4G wireless service $160 a month.

For subscribers who want more ubiquitous coverage, Comcast is offering a 3G/4G service that provides wireless connectivity on the Clearwire 4G network when it is available and on Sprint Nextel's 3G wireless service in other areas where 4G is not available. The cost of this service is an additional $20 per month.

Existing Comcast customers can add the new service for $30 more a month to their existing packages. And they can add the nationwide access with 3G access for $20 more per month.

Comcast has had its eye on the wireless market for quite sometime. The company bought wireless spectrum in the Federal Communications Commission's wireless spectrum auction in 2006. So far, the company hasn't said what it plans to do with that spectrum. But it has at least 10 years to decide, after which time the FCC could ask for the licenses to be returned.

Comcast has also worked with other cable operators to form a joint venture with Sprint Nextel in 2005. This joint venture was supposed to allow Comcast to bundle its broadband, TV, and telephony services with Sprint's wireless services. But the partnership never really got off the ground.

This time, Comcast thinks it has the right service package that will finally offer consumers a compelling product mix. The company is interested in not only using the service to help it win new customers but to also help it keep existing ones who may be tempted to defect to phone company competitors.

"This is really our first entree into expanding our in-home broadband service in combination with a wireless Internet service," said Catherine Avgiris, the company's senior vice president and general manager of wireless and voice services. "We are trying to get those consumers, who may not have chosen Comcast's broadband services in the past, to see that they can get the best and fastest in-home and wireless service from Comcast. But we are also trying to make sure we can keep the customers we do have from going to a competitor."

While it's clear that Comcast is using this new service to compete against its phone rivals, namely AT&T and Verizon Communications, it will also be competing against its partners Clearwire and Sprint Nextel, which will also be selling the same WiMax service to consumers.

Clearwire's service called Clear starts at $20 per month for in-home wireless broadband. And its mobile Internet plans start at $40 per month. Customers can also get a day pass for $10. The company also allows customers to add voice service to their in-home package for $25 per month.

Sprint is also offering a 3G/4G wireless service for people living and traveling regularly to places with 4G wireless coverage. For about $20 more a month, Sprint wireless data customers can get access to its 3G network plus the 4G Clearwire network for $80 per month. Sprint's regular 3G wireless data service costs about $60 per month.

AT&T and Verizon haven't included their 3G wireless data services into their in-home broadband and TV services, but the companies have been offering special deals for wireless customers. And both operators have announced Netbook offers where they subsidize the cost of these mini-laptops in exchange for a two-year service commitment. AT&T has also given free Wi-Fi access for its more than 20,000 Wi-Fi hotspots around the country to its broadband customers as well as some smartphone users.

AT&T isn't the only Wi-Fi provider that could compete with Comcast's 4G wireless service. In cities, such as San Francisco, there is already quite a lot of Wi-Fi in public places thanks to services like X. And in Philadelphia where EarthLink had deployed a citywide Wi-Fi network, Wi-Fi is still available for free in some locations.

Comcast isn't completely down on Wi-Fi. The company also offers a Wi-Fi solution in cooperation with Cablevision, a cable operator serving the New York area. The two companies are deploying Wi-Fi hotspots in train stations and on train platforms along the North East corridor from Philadelphia to New York City. The Wi-Fi access is free to Comcast and Cablevision broadband subscribers.

But Wi-Fi doesn't offer ubiquitous coverage. So these networks aren't the best answer for every consumer. But the success of Comcast's 4G wireless service is very much dependent on price. The company has priced the first year of the service extremely well, making it the hands down winner in terms of value for consumers. But it will be interesting to see if consumers are still interested in the service once the promotion is over.

The other potential downside to the service right now is that consumers will only get one USB laptop card per account. This might make it hard for families with multiple family members who want wireless broadband service outside the home. And this is also a problem for small businesses, which Comcast is also targeting with this service.

That said, Avgiris said that Comcast is working on a solution and will be offering multiple wireless cards for an additional cost. But the exact pricing of these cards and service hasn't been determined just yet.

Correction: Telstra says it will not be introducing new 21Mbps-capable handsets at Mobile World Congress in Barcelona in February. The interview has been changed to reflect this.

If you're looking for a super fast wireless network, you might want to head to Australia, where Telstra, the largest wireless operator Down Under, has just launched an upgrade to its 3G wireless network that will offer peak data rates of 21 Megabits per second.

Sol Trujillo, Telstra CEO

(Credit: Telstra)

Of course, the 21Mbps downlink speed is a theoretical speed at peak performance. True download speeds will likely top out at between 4Mbps and 6.6Mbps. But that is still way faster than other 3G cellular networks around the world. In the U.S., most 3G cell phone users experience data downloads closer to 400Kbps to 700Kbps.

Telstra has improved the performance of its network by upgrading its 3G network, which uses a UMTS-based technology called HSPA or High Speed Packet Access. Enhancements to this technology will boost download speeds to enhance the mobile broadband user experience and enable a wide range of services, like mobile TV.

AT&T in the U.S. has also used HSPA technology to build its 3G wireless network. And like Telstra, it plans to increase the capacity of its wireless network using upgrades to its existing network. Last May, Ralph de la Vega, AT&T's mobility chief, said AT&T would be offering 20Mbps downloads over its wireless network as soon as 2009.

I recently sat down with Telstra CEO Sol Trujillo to get the scoop on his company's super fast network as well as to get some idea of where he sees the wireless industry going in the future. Below is an edited version of our conversation, as well as excerpts from an e-mail exchange following up our conversation.

Q: Telstra claims it has the fastest cellular data network with downlink transmission speeds up to 21Mbps. How is the 3G network you've built different from what people experience here in the U.S.?
Trujillo: Anyone can deploy anything on paper. And a lot of companies say they have deployed HSPA. But if you go to Australia and use services, you will get higher throughput wherever you go, no matter what city you are in or if you're in the bush.

How were you able to do that?
Trujillo: Building a network is more than just ensuring there is a connection between the device and the cell tower. There's also backhaul. And the chipsets in devices need to be able to handle things like the one button, one click to enable customers to get to a store. That is all part of the experience. What is the difference between 14Mbps and 21Mbps? The 21Mbps is more real time. It's all about the experience.

And how is the experience you've created in Australia different from what people get here in the U.S. with 3G wireless networks?
Trujillo: We made a big bet to roll out a nationwide 3G network nationwide to more than 2 million square kilometers in 10 months. We turned the whole network up on one day. I got criticized when we announced we'd do this. NTT had rolled out 3G and it was a big yawner. And the difference in ARPU (average revenue per user) between 2G and 3G services for carriers in Europe was only about 1 or 2 Euros. People weren't spending more money on the new network. And people said, "Why the hell are you spending this kind of money to build this network?" And I said, "Watch. We will create a new experience."

The difference in ARPU for us between 2G and 3G is $20 a month. Over 50 percent of our subscribers are on the 3G network. In the U.S., the 3G experience is spotty. It works well in some places. But if you commute, you probably get dropped calls the whole ride to work. This is unacceptable, especially when you are surfing the Web on your phone. You go to a Web site and the connection drops. To reconnect you have to start all over. It's not a pleasant experience. And people aren't going to spend money on a service if they don't think it's worth it.

In Australia, people will spend money if they think they are getting a good quality service. Our data pack consumers, the ones using a data card for their laptops, are generating $90 per month in revenue per user. It's all about the experience and making sure the service works where ever you are. If you know you can count on it, you start using it more. If you aren't sure whether it will work in some places, or if you think it will have slower speeds, you won't use the service and you'll just wait until you get some place where you know you'll have consistent service.

How much faster do you think you can scale this 3G network with current technology?
Trujillo: We'll be able to take this HSPA Plus technology to 100Mbps between now and 2010 or 2011. But the determining factor will be how much more bandwidth consumers really need. LTE is probably the next step for 4G technology, but we haven't made any announcements yet. But 4G is a long way off, probably not until 2015.

What is the plan in terms of rolling out the 21Mbps service?
Trujillo: We went to 21Mbps at the end of last year. And we're offering wireless laptop data cards in the first quarter.

What's the primary focus or strategy for Telstra?
Trujillo: We want to make communication easy. You have to make it about one click. There are many phones and services out there that people don't use because there are too many clicks to access them.

Do you think that Apple with its iPhone has done a good job in making it easy to access new applications and surf the Internet from a cell phone?
Trujillo: Yes, they have done good job. But Telstra gives consumers that plus choice. Apple has its view. Research In Motion has its view. And Microsoft has its view. Our job is to give consumers choices, but also give them the simplicity of that one-button, one-click experience. And we don't offer this simplicity on just one phone. We offer it on all our phones, including flip phones and slider phones. The button that says Big Pond or Foxtel for cable TV is right there on the phone, so users can access the broadband portal or watch TV right from their phones.

That brings up another interesting topic: Mobile TV. Foxtel is Telstra's cable TV service, as you mentioned. Do you see a lot of subscribers interested in watching TV on their phones?
Trujillo: People like snacking on mobile TV. They like to watch the news or they watch a big breaking news event, like what was unfolding in Mumbai last year. They want to find out what happened. And they want the latest news. They also want the latest scores for the sports matches, or they're checking the financial markets.

Here in the U.S., mobile TV hasn't yet taken off. What kind of uptake are you seeing in Australia?
Trujillo: Right now, it's building. Phones with better screen resolution are coming out and devices with better latency. One of the big things that Apple did was optimize its software operating system to reduce latency so that they could do a lot more with the phone in terms of video.

What kind of subscribership does Telstra have for Mobile TV?
Trujillo: I'd say that that a little under 5 percent of our Next G subscribers are viewing TV on their phones. It is growing, but I don't think it's going to be something that 50 percent of our subscribers will be doing in the next five years. But I think we can get to between 15 and 20 percent of our customer base to start watching TV. But when that happens it will be significant. We make about $10 and $11 ARPU on TV watchers.

In the U.S., some carriers are charging $10 and $15 extra for mobile TV service. And I think that might be slowing adoption. How do you think pricing affects adoption?
Trujillo: Part of it is price. Part of it is billing. People also need to know that it's available, and how they can use it. There's a whole learning curve that goes on. We actually have used different pricing models. For the Olympics, we sold packs for 15 days for $15.95 or $4.95 for one day. For example, when Grant Hackett, the Australian swimmer, swam the 1500 meters, we saw a huge spike in subscribers and usage. But typically it's about $10 or $11 per month on average for the TV service.

I think the real barrier to mobile TV adoption is that it needs to be one-click access. If there are multiple clicks to get there, people won't use it.

Google has talked a lot about its open platform for cell phones. And Verizon Wireless has talked about making its wireless network more open. What is Telstra's take on openness?
Trujillo: As carriers, we all have to enable features, services, and content that people want to see. And we need to offer devices that people want to use. So we have to create a process by which developers can enable new applications and services in a quick, easy, reliable and secure way. But the reality is that when something goes wrong with your phone or an application, everyone points to the carrier.

So if I allow an infection in my network, you won't be happy as a consumer. So you, the consumer, want us to make things reliable and secure. At the same time, I also need to provide new and interesting applications. And developers are thinking of 20 or more ideas a day. So we need to balance how much we take in with also providing the proper filters. And we also don't want to flood the customer with too much.

What do you think about Google's Android platform? Is Telstra going to announce it will support an Android phone anytime soon?
Trujillo: We are looking at it. But the platform isn't at the stage where it's really robust. We are looking at what's being said about it in the blogosphere, and we're looking at testing it. But it's still in evolution right now. It's very Google-centric. And there are limitations. We are hopeful that it will be more open, because it offers a great alternative operating platform. But it's not there today.

There were some reports recently that Telstra is interested in the new HTC Android phone that is expected to be on the market later this year. Can you share any thoughts with me on that?
Trujillo: I was very impressed by the array of new smartphones unveiled at the Consumer Electronics Show. Handset manufacturers such as Palm, HTC, and LG unveiled some great new products that focus on the features customers are increasingly looking for in a phone, like one-touch access to their favorite applications and services.

So is Telstra going to offer an Android phone?
Trujillo: At this stage, we have no announced plans. But we're looking at it and having conversations. We won't be rolling it out tomorrow. The research we've done suggests consumers want more simplicity and not more complexity.

Do you think that simplicity is missing in the U.S. market?
Trujillo: I think it's lacking everywhere. It's one of my passions to make things simpler. When I think of myself as a user I have different needs as a CEO when I am at work than when I am home as an average user. At home I'm looking for more entertainment. And how I interact with my employees at work is different from how I interact with my children at home. The key to this market is understanding that people are multimodel and multi-environment.

What has happened is we have segmented the market by product. But what we need to do is look at the market from a lifestyle perspective. That should drive new products. And it should be simple.

So where does Telstra go from here?
Trujillo: We're looking to do more integration with our Big Pond content engine, so that you can download a song that shows up on your laptop and your phone. Integration of these services is the hard part. Our next G network is IP and so is our fixed line broadband network, so we are integrating features and services so they work across different platforms. We want people to be able to get one bill and use the same service on whatever device or platform they want whether it's at home or on the train.

How is the economic downturn affecting your business?
Trujillo: We are experiencing the downturn. But not like folks are here in the U.S. Nowhere else seems to be feeling it like the U.S. is. But are there economic pressures? Yes. Will some consumers look at trade-offs about what services to keep and which ones to cut back on? The answer is possibly, yes. But we think the wireless device has become essential. It's one of the three things that people don't leave home without. Most people have become real time. People want to send SMS messages or e-mail if they can't call. So far we haven't seen usage change.

What about on the cable side? Do you think that as the crisis deepens people will cut back on things like cable TV service?
Trujillo: The vast majority of people won't deny their whole family in-home entertainment. In fact, they might spend more at home. Instead of going to the movies, they will subscribe to HBO or whatever premium channel is offered in Australia.

I've seen you pull out a couple of phones during the interview from your pockets. How many phones do you actually own?
Trujillo: Well, let's see I have an iPhone, BlackBerry Bold, a Verizon LG Voyager, Samsung touch screen, and a couple of others. I try them all in different markets as I travel the world. I'm always testing networks. My job is to study the markets. And watch how people use them. When I was on the board of Pepsi, I watched and learned how people consumed Pepsi products. I'm on the board of Target and I've learned about retailing. It's all about the customer's experience. It's not about the network or the system the service is delivered on. It's the customer.

Sprint Nextel announced Wednesday that it will start selling dual-mode 3G/4G wireless broadband modems for laptops starting Sunday.

Sprint 3G/4G USB Modem U300

(Credit: Sprint Nextel)

The new device allows users to access both Sprint's 3G cellular data network and the new 4G WiMax wireless network the company is building as part of the new Clearwire venture.

The modem known as the Sprint 3G/4G USB Modem U300 will use the new 4G Clearwire network with download speeds between 2 Mbps and 4Mbps where that network is available. And when users are out of range of the 4G wireless network, they will automatically be able to access Sprint's 3G network, which offers average downloads of between 600 Kbps and 1.4 Mbps, according to Sprint.

Sprint launched the 4G WiMax network called Xohm in Baltimore in October, just months before it officially merged its WiMax network with Clearwire's network. The service will be launched in other markets across the country throughout 2009.

At the Baltimore launch, Sprint's CEO Dan Hesse promised a wireless data device that would allow users to access both networks for better coverage.

"It will take a while for the new (4G) network to be built ubiquitously," Hesse said during the Baltimore press event. "And we will have new multimode devices that will use 4G where it's available, and when it's not, it will downshift to 3G to provide that ubiquitous data coverage."

The new wireless modem connects via a standard USB port and costs $149.99 after a $50 mail-in rebate and with a two-year subscription to the wireless data service. The wireless modem will be available through Sprint's direct business sales force and at most Baltimore-area Sprint stores and select Baltimore-area retailers, the company said. Starting in January, the device will also be available in Baltimore-area Best Buy stores.

The new wireless modem from Sprint will likely be a better deal for most consumers because the service, which costs $79.99 per month, offers the best coverage at the best price.

Mobile chipmaker Qualcomm has developed a new, low-cost computing platform that it hopes will provide an alternative to Windows-based PCs in parts of the world where traditional broadband connections aren't available.

The new platform called Kayak will be based on Qualcomm's dual-core MSM7 series chipsets. Eventually, the design could also include Qualcomm's Snapdragon chipsets, which offer both GSM-based and CDMA-based 3G technologies.

Qualcomm hopes the Kayak platform can fill a much needed niche between Windows PCs and smart phones when it comes to providing Internet-enabled devices in the developing world. PCs or laptops are often too expensive for people in these regions of the world. And because traditional broadband connections aren't available, it's difficult to connect PCs to the Internet.

That said, 3G networks are deployed throughout much of the world. As a result, it's becoming more common for people in developing markets to connect to the Internet via a 3G-enabled smartphone rather than a PC. But smartphones have small screens and keypads and don't provide all the necessary computing power for fully engaging the Internet.

This is where Qualcomm believes its Kayak devices come in. Devices that use the Kayak design could plug into TVs, computer monitors, or have their own built-in displays. They also support a keyboard and mouse and will be able to play digital music files as well as allow users to play 3-D games. And Qualcomm expects these devices to sell for less than $400 when bundled with a 3G wireless service from a carrier, which could hit an important sweet spot in developing markets.

"The broad footprint of 3G networks means that wireless is the answer to Internet access for worldwide markets--especially in emerging regions," Luis Pineda, senior vice president of marketing and product management for Qualcomm CDMA Technologies, said in a statement. "The Kayak PC alternative is a great example of how Qualcomm is leveraging cloud computing over wireless broadband networks to help bring new areas of the world into the global online community for the first time."

Manufacturers can design their own "Kayak" device
Qualcomm will not be manufacturing Kayak computing devices itself. Instead, the company plans to make a reference design and recommended software specifications available to device manufacturers. Manufacturers can then design their own devices based on the Kayak specification.

Taiwan's Inventec is making products based on the design. The devices will be tested early next year over CDMA networks in Southeast Asia, Qualcomm said.

"Emerging markets will be a huge growth driver for the telecommunications industry in the coming years," Mark Hirsch, vice president of corporate marketing at Inventec, said in a statement.

Qualcomm's Kayak effort is just one of many that have emerged to help get low-cost, Internet-connected computing devices in the hands of people in the developing world. Nicholas Negroponte, the co-founder of the Media Lab at the Massachusetts Institute of Technology, launched the One Laptop Per Child initiative, which is also trying to provide low-cost laptops to kids in developing regions. AMD, Intel, and Microsoft have also launched efforts to provide inexpensive devices in these markets.

The two men who will be first in line when the Apple store in SF opens Friday at 8 a.m. to sell its first iPhone 3G.

(Credit: Erica Ogg/CNET News)

This post was updated at 2:15 p.m. Pacific. See below.

They've arrived.

Apparently afraid they may not be one of the first people to get their mitts on the updated iPhone tomorrow, a few of the Apple faithful have taken position in front of the downtown San Francisco Apple store. At 8:30 a.m. Thursday, there were just two people and a tent.

Drinking a hot chocolate, and clad in a sport coat and tie, Dale Larson of San Francisco proclaimed the iPhone 3G launch would be "a way bigger deal this year than last year" when the original iPhone debuted.

That's why he arrived at 10:30 p.m. Wednesday and slept on the sidewalk at the intersection of Stockton and Ellis streets: to make sure that he would be first when those glass doors open Friday morning at 8 a.m. (He readily recommends it too. "All you need is a tent, earplugs and an air mattress," he says.)

When asked why he went through all that trouble of camping and waiting (again--he camped out for the iPhone launch last year, too) when there were no shortages on the first day of last year's launch, he blames this year's new procedure requiring that all phones be activated in the store on the day of purchase. "I don't want to wait a long time tomorrow," Larson said.

The second man, who arrived at 7:30 this morning with nothing but a folding chair, doesn't actually want an iPhone. But Xavier Llanos, originally of Barcelona but currently teaching 4th grade in Suisun City, Calif., says a friend asked him to get an iPhone for him to bring back to Spain.

Because he's not really an Apple fan, he had no idea what he expected to pay, and got a bit uneasy when reminded he'd have to either buy the phone unlocked for $499 or $599 or sign a contract with AT&T.

Even if Llanos doesn't decide to buy one after all, he said he enjoys the spectacle of queuing up for a gadget.

His fellow line sitter put it the same way. "It's fun to meet all these people," Larson said. "People will stop in their cars on the street here and ask, 'Are you really waiting for the iPhone?'"

Good question.

Update: Well, this is sad. I trekked back over to the Apple store at 1:30 p.m. to see if anyone had joined Larson and Llanos in line, and lo and behold, the line remained at just two people. (Come on, S.F., Apple fanboys in New York are totally beating you!)

While Larson retained his position as first in line (though he'd taken cover in some shade and packed up his tent at the behest of the SFPD), Llanos had disappeared. In his place was Ryan Johnson, 25, a new arrival in San Francisco, casually eating a bowl of takeout stir-fry. When asked how long he'd been in line, Johnson, who describes himself as "retired from the Internet," replied that he "doesn't really pay attention to time."

Lucky him. That's probably the best attitude you can have while waiting in the direct sunlight all day and camping on a sidewalk to buy a phone.

Johnson and Larson, SF's two most loyal Apple fans.

(Credit: James Martin/CNET News.com)