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.

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.

Clearwire named networking equipment maker Cisco Systems as a key supplier to help it build its nationwide 4G wireless network, the companies announced Wednesday.

As part of the new strategic partnership, Cisco will provide IP routers and other equipment to build Clearwire's network, which uses a technology called WiMax. Cisco will also develop some consumer devices that can be used on the network. Cisco wouldn't provide specifics about the new products, but a Cisco representative said that these devices will be sold under the Linksys brand and are expected to be introduced later this year.

Cisco, which is the world's largest supplier of Internet infrastructure equipment, has also been developing WiMax radio gear for a while. The company bought WiMax equipment maker Navini in 2007. But the company has mainly focused its WiMax radio products on fixed WiMax offerings that deliver broadband service to businesses and homes in areas where traditional land-based broadband infrastructure is unavailable.

Suraj Shetty, vice president of worldwide service provider marketing for Cisco, said that Cisco will still focus its WiMax business on building radio equipment for fixed broadband in the developing world. And he added that the deal with Clearwire is only to supply Internet infrastructure and consumer devices for Clearwire.

The companies did not disclose financial terms of the agreement.

Clearwire is building a nationwide wireless broadband network using WiMax. Late last year, it merged its wireless assets with spectrum from Sprint Nextel. And it has received billions of dollars in investment from Google, Intel, Comcast, and Time Warner.

The company has said that by the end of 2010 it expects to have service in over 80 markets with access to more than 120 million customers.

AT&T and Verizon Wireless, the two largest cell phone operators in the country, have already said they plan to use a competing technology known as LTE to build their 4G networks. Verizon will begin testing its this year and expects to begin commercial deployments of the service early in 2010.