November 29, 2007 12:37 PM PST
Verizon switches standards gears for next-generation network
Posted by Tom Krazit
Verizon Wireless is shaking up its technology plans for the second
time this week.
Two days after the company announced plans to open its network to
outside devices and applications, it announced plans to switch gears
when it comes to future networking technology.
Verizon Communications and Vodafone, joint owners of Verizon Wireless,
plan to use the LTE (Long Term Evolution) standard backed by GSM
industry players rather than the UMB (ultramobile broadband) standard
backed by Verizon's current partners.
There's a host of implications for the industry, but for the phone
user, the impact is simple. Right now, if you're a Verizon or Sprint
customer, and you want to travel to many parts of the world, you'll
have to get a rental, if you want to make calls while you're there.
The move toward LTE would bring Verizon into the GSM world and enable
travelers to use their phones around the world (for a hefty fee, of
course).
In some ways, the move makes a lot of sense, and Verizon CEO Ivan
Seidenberg hinted that this was coming a few months ago.
The GSM family of standards is used by about 80 percent of the world's
mobile phones--and by major carriers such as AT&T, T-Mobile, Vodafone,
and virtually every other European carrier. If Vodafone is already
planning to head down the LTE path for its own networks, it's natural
that Vodafone would nudge its subsidiary down a similar path so they
could share expertise and get better deals on equipment from companies
like Alcatel-Lucent and Nortel Networks.
But Verizon currently uses the CDMA (code division multiple access)
standard for its networks. CDMA is used by Sprint, and it's popular in
Asia. It's also controlled by Qualcomm, which owns patents on the CDMA
technology and runs a very lucrative business in licensing that
technology to carriers and phone makers.
This is going to take years to play out. Don't expect to see LTE
networks and phones for at least two to three years, said Avi
Greengart, an analyst at Current Analysis. All Verizon said on
Thursday is that, along with Vodafone, it plans to start testing the
LTE equipment in 2008.
But if the companies follow through with plans to deploy the LTE
networks, it could be a blow to Qualcomm's future business. Sprint's
4G plans are very much up in the air. It had originally announced its
intention to use WiMax technology for its 4G network, but after
sacking CEO Gary Forsee, the company is re-evaluating its plans.
At peak rates (which are rarely reached in the real world), LTE
networks will let you download data at a whopping 100 megabits per
second, compared to the 1Mbps or so that you'll get from a 3G EV-DO
connection on Verizon's network at the moment, or a 1.5Mbps DSL
connection at home.
In a press release announcing its decision, Verizon noted that this
type of bandwidth won't just be for cell phones. "Discussions with
device suppliers have expanded beyond traditional suppliers, such as
LG, Samsung, Motorola, Nokia, and Sony Ericsson, as consumer
electronics companies anticipate embedded wireless functionality in
their future products."