September 19, 2005 12:25 PM PDT
Verizon Wireless teams with notebook makers
On Monday, the company announced plans to embed its technology in notebook computers from three top manufacturers: Dell, Hewlett-Packard and Lenovo, which earlier this year bought IBM's ThinkPad division. Lenovo on Monday also unveiled its new ThinkPad Z series, with prices starting at $799 for the Z60m model.
Verizon Wireless offers its BroadbandAccess service, which is based on a technology called Evolution-Data Optimized, or EV-DO, in 60 markets across the United States. The service allows customers to connect to the Internet wirelessly wherever a Verizon Wireless signal is available. Download speeds average between 400kbps and 700kbps, comparable to some DSL services.
Today, the service requires users to purchase a separate wireless card, which fits into a laptop, for about $100. Starting in the first quarter of 2006, Dell will offer customers the option of embedding Verizon's EV-DO functionality into its Latitude series of laptops. Dell already gives customers two other choices to connect to the Internet wirelessly: Wi-Fi technology and Cingular's EDGE technology, which provides download speeds between 100kbps and 135kbps.
On Monday, HP also announced it will be working with Verizon to offer an EV-DO-ready laptop. The new laptops, using chipsets from Qualcomm, will be available in early 2006. Lenovo said Verizon EV-DO technology will be embedded in its Z series notebooks available in October.
Verizon Wireless currently has the most extensive high-speed broadband footprint of any cellular provider. But it won't be long before competitors, such as Sprint Nextel and Cingular, catch up. Lenovo has already begun evaluating wireless broadband technology from other service providers, but it is not ready to announce specific plans to integrate the technology into its products, said Mike Callahan, worldwide ThinkPad product manager for Lenovo.
In the meantime, Verizon is focused on signing up as many customers to its EV-DO service as it can. As part of this push, last month it announced it was lowering prices to $60 from the previous price of $80 to attract new customers.
The deal with laptop makers is another important step for Verizon as it tries to push its EV-DO service into the mainstream. Making it easier for users to access the service is a key factor in increasing adoption.
The strategy worked for Wi-Fi, another wireless technology for connecting to the Internet. Thanks to Intel, which makes Wi-Fi chipsets, the technology is embedded in most laptops sold today.
"Once Wi-Fi technology was embedded into notebooks, wireless LANs really started to take off," said Lenovo's Callahan. "We see the same thing happening for wireless WAN. The people who really want mobility while they are away from the corporate LAN or a Wi-Fi hot spot will really find this technology useful."
Wi-Fi is potentially the biggest threat to Verizon's EV-DO service. It's already available in many airports, hotels and coffee shops throughout the country. And in many cases it's offered for free. Cities such as San Francisco and Philadelphia are even planning to blanket their cities with the technology to provide free Internet service.
But there is a downside. Wi-Fi's transmission distance is relatively short, often making it difficult for business travelers to count on a strong signal or any signal at all when they're on the road. The advantage to EV-DO is that its signals can travel greater distances, providing more widespread and uninterrupted Internet access for customers. This distinction could make it more attractive to corporate road warriors.
Despite the promise of wider coverage, Verizon customers may not see the same speeds with their EV-DO cards and embedded chips as their Wi-Fi counterparts.
While 802.11 consistently hits speeds of 11mbps, Verizon's promise of as much as 700kbps for its BroadbandAccess service is actually more comparable to AOL dial-up, Sam Bhavnani, an analyst with Current Analysis, said.
"I could see this being used more by business users than casual users," Bhavnani said. "I know when I travel through several airports, the cost to hook up to all of these separate Wi-Fi providers costs me $6, $7 a pop. By the time I get home, I could be spending close to $30, so the key for Verizon is price.
However, Bhavnani also noted that Verizon is currently servicing about 39 out of the top 50 cities in the United States.
"You could easily find faster Wi-Fi connections in any of those cities," he said.
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