Wireless

In the battle between LTE and WiMax for wireless broadband, LTE may have just gotten another boost.

A group of leading telecom service and equipment providers, including AT&T, Verizon, Nokia, and Samsung, announced a new standard Thursday for delivering compatible voice and messaging services using Long Term Evolution (LTE) networks.

The standard, dubbed the One Voice initiative, offers a set of technical functionalities that telecommunication companies can use in their LTE services and products to provide both voice and Short Message Services (SMS).

The group of companies setting up One Voice (which also includes LTE proponents Orange, Telefonica, TeliaSonera, Vodafone, Alcatel-Lucent, Ericsson, Nokia Siemens Networks, and Sony Ericsson), see the standard as a way to provide interoperability for broadband voice and SMS services. The goal is to give telecom providers and manufacturers a convenient technical profile for working with each other and save customers from wrestling with different and conflicting LTE technologies.

LTE has been fine at supporting data, which uses IP-based packet switching. But it's faced challenges trying to incorporate traditional circuit-based switching voice and SMS services onto IP-based networks. One Voice is the group's attempt to resolve that issue.

The new specification will use existing functionality known as IP Multimedia Subsystem (IMS), which already defines how to provide data, voice, and other content over an IP-based network. IMS was established by the 3rd Generation Partnership Project (3GPP), a group comprised of telecom industry associations trying to set standards for 3G mobile networks.

"Open collaborative discussions have concluded that the IP Multimedia Subsystem-based solution as defined by 3GPP, is the most applicable approach to meeting the consumers' expectations," said One Group in a statement.

In recent years, LTE has been duking it out with WiMax to be crowned the upcoming broadband wireless standard. In one corner has been telecom giants like AT&T and Verizon, both of which have announced plans to deploy 4G wireless networks using LTE.

In the other corner has been Sprint, which is eyeing a rollout of its own 4G network using WiMax. Sprint owns a majority stake in WiMax provider Clearwire, a wholesale distributor of 4G services. Clearwire recently unveiled a huge WiMax testing sandbox in Silicon Valley where developers could play with the technology.

However, Clearwire has been waffling on the choice between LTE and WiMax. In a recent interview with Dow Jones Newswires, Clearwire CEO Bill Morrow said he would be willing to switch to LTE if helped the company.

German phone giant Deutsche Telekom is looking to jump into the 4G wireless market in the U.S. through partnerships with U.S.-based service providers, according to a report by Bloomberg News.

Bloomberg reported Tuesday that Deutsche Telekom is looking to beef up its presence in the U.S. wireless market by investing in Clearwire, a company that is building a 4G wireless network using a technology called WiMax. Sources also told Bloomberg that Deutsche Telekom is also talking to Metro PCS, which recently acquired spectrum to build its 4G wireless network.

Deutsche Telekom already owns T-Mobile USA, the fourth-largest wireless carrier in the U.S. But the carrier's growth has remained flat for several quarters. And the company hasn't yet announced plans for its next-generation network.

Last week, rumors resurfaced that Deutsche Telekom was looking to buy Sprint Nextel. Sprint is the third-largest wireless operator in the U.S. and has been struggling the last few years to retain customers. The idea behind a potential buyout of Sprint is that it would give Deutsche Telekom more subscribers, which could help it compete more aggressively against the two largest wireless carriers in the U.S., AT&T and Verizon Wireless.

But now it looks like the German telecom giant could be looking for a more cost-effective way to increase its presence in the U.S. market.

Partnerships with Clearwire and MetroPCS would cost the German phone company much less than purchasing Sprint outright, and it would be a lot easier than trying to digest another wireless provider.

Buying Sprint Nextel would likely become an integration nightmare for Deutsche Telekom. Sprint Nextel is already the product of what many consider one of the worst telecom mergers ever. Sprint bought Nextel in 2005 for $35 billion. And for the past four years, the company has struggled to integrate two different wireless networks. Sprint's network operates using a technology called CDMA, while Nextel uses a technology called I-DEN. T-Mobile USA uses GSM, which would introduce a third type of technology into the mix.

But if 4G access is what Deutsche Telekom really wants, then a partnership with Clearwire makes sense. Sprint owns about 51 percent in Clearwire. Last year, the companies created a joint venture combining assets from both companies. Clearwire, which has already begun building its nationwide 4G wireless network, is using 2.5 GHz spectrum that is owned by Sprint.

Clearwire said in August that it would spend between $1.5 billion to $1.9 billion in 2009 to expand its network. Deutsche Telekom could provide more funding for this endeavor in exchange for access to the network, Bloomberg reports.

Clearwire has already made similar deals with other investors. Last year, cable companies Comcast and Time Warner Cable were among investors that provided the company with $3.2 billion in funding. Google and Intel have also invested in Clearwire.

As the Clearwire network comes online, Comcast and Time Warner Cable have each announced they will offer mobile wireless broadband service using the Clearwire network in areas where they offer cable service.

A deal with MetroPCS, which sells prepaid wireless service, could help Deutsche Telekom get access to a 4G wireless network that will use a more widely adopted technology called LTE or Long-Term Evolution. MetroPCS acquired spectrum in the 700 MHz wireless auction, and it has said that it plans to build a 4G network using LTE starting in 2010. Verizon Wireless, the nation's largest mobile operator, which also acquired spectrum in the same 700 MHz auction, is also building a 4G wireless network using LTE.

Clearwire Communications has created a sandbox more than 20 square miles in size where developers can play with WiMax.

Clearwire announced on Tuesday the launch of the largest test area yet for its 4G WiMax service in Silicon Valley. Covering a wide area from Santa Clara to Mountain View to parts of Palo Alto, the company's Clear 4G WiMAX Innovation Network will let developers test the mobile broadband network on a large scale.

First announced in April by Clearwire, the Clear 4G WiMAX Innovation Network is seen as a testbed to prepare for the launch of commercial WiMax service in the San Francisco Bay area next year.

The 20-square-mile service will hit the campuses of Intel and Google, two investors of Clearwire's 4G WiMax network who've already begun their own own internal 4G testing. Cisco Systems, which will provide equipment to Clearwire, will get coverage in a few months as the network grows.

To play in the new WiMax sandbox, developers must register with Clearwire's development program and describe the WiMax ideas they'd like to pursue. Developers would also need to buy a Clearwire WiMAX USB modem for $49.99. Clearwire says it will provide the service for free to a limited number of qualified developers prior to the commercial launch.

Clearwater will also join and help sponsor the Sprint Open Developer Conference running October 26 to 28 in Santa Clara. The company encourages developers working with Clear 4G WiMax to attend the conference to learn more about the service.

Clearwire touts its Clear 4G WiMax service as offering peak download speeds of up to 10 Mbps, with an average of 3 Mpbs to 6 Mbps. As a comparison, the company says that today's 3G networks can only reach speeds of about 600 kbps to 1.4 Mbps.

WiMax has faced tough competition from LTE for the battle to become the wireless 4G standard. Backed by AT&T and Verizon Wireless, LTE is sometimes forecast as the ultimate victor with potentially the more dominant share of the market. But WiMax is also expected to grow as deployments ramp up.

This was originally posted at ZDNet's Between the Lines.

Clearwire said Tuesday that it expects fourth-quarter net subscriber additions to ramp as it rolls out its 4G WiMax service into more markets. That tipping point will be critical to the company's success--and possibly its survival.

On a conference call with analysts, Clearwire CEO Bill Morrow said that he was pleased with WiMax uptake in new markets such as Las Vegas. Morrow added that "fourth-quarter net subscriber additions will be higher than all 2009 quarters combined."

That's good since Clearwire projected a cash burn of $1.5 billion to $1.9 billion for 2009. So far the company has burned through $646 million (statement). Clearwire had $2.5 billion in cash as of June 30. If the fourth-quarter 4G customers don't roll in, Clearwire may be cutting it close with its cash burn. Morrow and CFO David Sach cited Clearwire's strong balance sheet, but Moody's has it on its "bottom rung" list of companies with weak liquidity.

Clearwire rolled out its Atlanta WiMax service in June and followed up with Las Vegas in July. The company plans to cover 30 million people by the end of 2009 as it launches 4G WiMax services in markets ranging from Philadelphia to Seattle to Maui and Honolulu to various locales in Texas. Clearwire--along with partners Sprint, Comcast, Time Warner Cable, and Google--is betting on WiMax for 4G service while other much larger rivals such as AT&T and Verizon are betting on Long Term Evolution (LTE) networks.

Clearwire is planning to emerge as a 4G service wholesaler with big partners being the key distribution channel.

For now, Clearwire's results show the company is in a waiting game. It's a small wireless provider, facing high churn rates (some related to moves to 4G), and the plan is to leverage the distribution heft of partners such as Sprint.

The company reported a second-quarter net loss of $73.4 million, or 38 cents a share, on revenue of $63.6 million, up 9 percent from a year ago. Wall Street was expecting a loss of 39 cents a share on revenue of $65.2 million. Clearwire shares slid in afterhours trading.

Clearwire executives said the company will be aggressively hiring workers as it rolls out services. Capital spending will also increase in the second half of 2009. The company has big suppliers such as Cisco, Huawei, Motorola, Samsung, and Ciena that can enable Clearwire to cut equipment costs.

By the numbers:

• Clearwire added 12,000 net subscribers in the second quarter for a total base of 511,000, up from 461,000 a year ago.

• Average revenue per unit was $39.47 on par with a year ago.

• The second churn rate was 2.8 percent, up from 2.6 percent a year ago. Clearwire expects churn to continue to trend higher.

• Clearwire has 23.1 million points of presence, up from 16.8 million a year ago.

Clearwire, which is using Sprint Nextel's 2.5GHz spectrum to build a nationwide 4G wireless network, announced Monday 10 more markets that will get the company's Clear WiMax wireless broadband services starting September 1.

Eight of the newly announced cities are in Texas: Abilene, Amarillo, Corpus Christi, Lubbock, Midland/Odessa, Killeen/Temple, Waco, and Wichita Falls. The other two markets are Boise, Idaho, and Bellingham, Wash.

These 10 markets will join four other officially launched WiMax markets: Atlanta, Baltimore, Las Vegas, and Portland, Ore.

Some of the additional markets planned to launch in 2009 include Chicago, Charlotte, N.C., Dallas/Ft. Worth, Honolulu, Philadelphia, and Seattle.

Clearwire says it's on track to launch 80 markets by the end of 2010. In 2010, it plans to roll out service in New York, Boston, Washington, D.C., Houston, and the San Francisco Bay Area among others.

It's important for Clearwire to launch more markets, especially in major cities where its joint venture partners can also resell the service. Comcast, Time Warner Cable, and Bright House Networks have each invested in Clearwire, along with Google and Intel. Altogether the companies pitched in $3.2 billion. Comcast and Time Warner Cable have already announced plans to start reselling the WiMax service in areas where they offer cable service. These cable companies plan to bundle the 4G wireless broadband service with their existing high-speed broadband services.

Sprint Nextel, another major Clearwire partner, is also reselling the service combined with its 3G wireless service in some markets, such as Baltimore.

Clearwire uses 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 4 megabits per second for downloads and 500 kilobits per second for uploading, which is more than double what consumers can expect using a 3G wireless connection.

The Clear WiMax service from Clearwire 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.

Time Warner Cable will soon be offering a 4G wireless broadband service using Clearwire's WiMax network.

CEO Glenn Britt told investors during Time Warner Cable's second-quarter earnings call on Wednesday that the company will begin reselling wireless service through Clearwire starting this fall in Dallas and Charlotte, N.C.

Clearwire uses 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 4 megabits per second for downloads and 500 kilobits per second for uploading, which is more than double what consumers can expect using a 3G wireless connection.

Britt didn't disclose product offerings or pricing, but he said that investors will hear more details about the new service later. But it's likely that Time Warner will bundle the 4G wireless service into its cable modem broadband services.

"We see wireless as complementing wireline," he said.

Time Warner Cable invested in Clearwire in 2008 joining fellow cable company Comcast, as well as tech giants, Google and Intel. The companies contributed a total of $3.2 billion to the new company. Sprint Nextel also invested in the new Clearwire and is allowing it to use its 2.5 GHz wireless spectrum to build the nationwide network.

Clearwire's service is up and running in a few cities, including Atlanta, Baltimore, Las Vegas, and Portland, Ore. And the company has plans to roll it out in more markets this year and into 2010.

Comcast has already begun reselling the Clearwire WiMax service, which it calls High-Speed 2go, in Portland and Atlanta. Comcast is offering the service at the promotional price of $49.99 per month for a year.

Sprint Nextel is also reselling the Clearwire WiMax service in certain markets, such as Baltimore. The Sprint service offers laptop users the option of using the 4G WiMax network where it's available and Sprint's 3G wireless network where it's not available.

Clearwire also sells service in every market where it's launched. The 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.

The number of people grabbing their Internet access through WiMax is expected to jump to 50 million by 2014, says Juniper Research.

A report released Tuesday by the British research firm describes the growth in WiMax stemming from areas unreachable or unserved by broadband cable or DSL.

(Credit: Juniper Research)

WiMax is a wireless technology that delivers broadband speeds over the last mile, ideal for locations where cabling is not available or feasible. Faster than current wireless 3G technology, WiMax can also serve large metropolitan areas as it covers a wider area than conventional Wi-Fi.

Referenced in the report, the most advanced WiMax standard, WiMAX 802.16e, delivers greater throughput than other WiMax standards.

Though large-scale WiMax deployments have been delayed, many providers have so far been successful in countries ranging from Pakistan to the U.S., says Juniper.

The new 4G Clearwire wireless networks used by Sprint, Comcast, and other providers, runs over WiMax.

But WiMax faces an uphill climb against the competing wireless broadband standard Long Term Evolution, or LTE. A recent study by research firm In-Stat, predicted that WiMax may ultimately lose the battle against LTE, which is already backed by major telcos AT&T and Verizon.

Juniper Research, however, believes that the global deployment of WiMax will drive its growth. The larger number of WiMax subscribers will be in the Far East and China region, says the report, due to that area's early adoption of the technology.

WiMax gains in Western Europe and, to a lesser degree North America, will occur in areas underserved by DSL. Growth in Africa and the Middle East is likely to surpass that of Western Europe, says Juniper, gaining 15 percent of the overall WiMax subscriber base by 2014.

"WiMAX 16e will have opportunities not just in developing countries, but also areas of developed countries where the DSL coverage is weak or nonexistent," said Howard Wilcox, the author of the report. "The key for the industry ecosystem now is to overcome the challenges and ensure trials evolve into commercial services quickly."

More information about WiMax can be found here.

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.

The venture capital arm of chipmaker Intel has announced an investment in Japanese WiMax company UQ Communications, which intends to provide coverage to most of Japan by 2012.

Intel Capital announced the $43 million investment on Sunday. Intel has long been a prime backer of the wide-range wireless technology, which it says has been deployed to varying extents in 135 countries.

"Intel Capital's investment in UQ Communications is one of our most significant commitments in developing the WiMax ecosystem around the globe," Intel Capital president Arvind Sodhani said in a statement. "UQ's WiMax deployment in Japan is a spectacular example of technology innovation being put to work."

UQ, whose network went live in February, is deploying the mobile variant of WiMax. The fixed version is already being offered in some areas of the U.K., but deployment of the mobile version--a candidate for the title of "4G"--is being held up by a lack of available spectrum.

When it goes to auction, the bulk of this spectrum--in the so-called "3G expansion band" around 2.6GHz--is expected to go to providers of rival technology LTE, but it is possible that some will be bought by a provider of mobile WiMax.

LTE has the backing of most of the incumbent mobile industry, but deployments are expected to lag behind mobile WiMax by a year or two.

David Meyer of ZDNet UK reported from London.