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Apple started taking pre-orders for the iPad this morning, and provided more details of the optional 3G data plan: Apple's deal with AT&T, assumed to be somewhat similar with non-US carriers when those plans are announced, called for $15 price tag on 250 MB of combined upstream and downstream data usage, and $30 per month for unlimited usage. Neither plan required any contract commitment.
[Update: To expand on a question and my answer in the comments, Apple and AT&T market the iPhone and iPad 3G unlimited plans as truly unlimited. Average iPhone user is a few hundred MBs per month; heaviest use is likely on Wi-Fi networks. With no tethering, an unlimited plan isn't a huge risk for a carrier. If AT&T ever lives up to its promise to offer tethering, expect a separate fee and 5 GB limit.]
Apple made clear today that the 250 MB plan doesn't tack on overage fees when you exceed that quantity of data: rather, you can either upgrade to unlimited (presumably for $15, but that's not stated), or shut off 3G when you run out. That's the most humane offer I've seen to date.
As stated at the iPad launch announcement, iPad owners with 3G built in ($130 more than the Wi-Fi-only version) can sign up for a plan or turn it off from the iPad without having to visit a Web site or go through a separate process. Reducing friction always improves sales, and that also dramatically reduces AT&T's costs by making it a self-service, Apple-handled option.
All four major US carriers offer a low-bandwidth option for 3G service in which 200 to 300 MB of usage is included, but extra megabytes are charged at 10 to 20 cents a piece--$100 to $200 per GB. Virgin Mobile is the only firm that lets you buy preset chunks of data (which must be used within either 10 days for the smallest increment or 30 days for the three larger options).
Apple says that 250 MB subscribers will be warned when they have 20, 10, and no data left, and can then choose to upgrade. Because the plans are month-to-month, a subscriber could upgrade one month and return to the 250 MB level the next.
The lack of "gotchas" will definitely go a long way in getting more people to buy the 3G model and use the service.
Posted by Glenn Fleishman at 11:20 AM | Permanent Link | Categories: 2.5G and 3G, Consumer Electronics | 2 Comments
T-Mobile cuts its 3G prices by $10 per month for unsubsidized hardware: It's long been an irritation of cellular customers that even when they pay the full price of a phone or 3G modem, the monthly data charge remains the same as people who get a subsidized version. That's changing, with T-Mobile in the lead. T-Mobile cut its unsubsidized monthly fee for 3G service by $10 per month for its 200 MB and 5 GB plans.
Last month, T-Mobile dropped the monthly data cost for some smarpthones by $20 per month for people who purchase outright. The New York Times noted that the MyTouch 3G is $400 without subsidy or $150 with a two-year contact. The most basic voice and data plan is $60 per month for the unsubsidized phone or $80 per month with a subsidy--a $230 difference over two years.
The latest deal comes with the announcement of a ship date and price for the webConnect Rocket, an HSPA+ modem that works at a raw data rate of 21 Mbps. The new 3G service plans for 200 MB and 5 GB per month (combined upstream and downstream usage) will be $19.99 and $49.99 with a modem purchased at list price; the $29.99 and $59.99 remain in place for subsidized modems. The lower price also doesn't require a contract commitment.
T-Mobile sells its HSPA 7.2 webConnect modem for $129.99 retail and $19.99 with subsidy; that's a $110 difference upfront for $240 worth of savings over two years, plus the flexibility to cancel at any time.
Of course, T-Mobile also charges the highest rate for data overages: 20 cents per MB ($200 per GB) above the 200 MB or 5 GB limits of the plan. Virgin Mobile Broadband's prepay plan is $60 for 5 GB (used within 30 days), but an additional 5 GB is another $60 even within 30 days, while T-Mobile would add $1,000 to your bill for that privilege.
If T-Mobile wants to be truly progressive, it needs to sort out that discrepancy, designed to keep down usage rather than truly penalize subscribers. With HSPA+ offering potentially three times or greater the speed of the current network, limiting users to 5 GB and charging $20 per GB for overage seems very out of sync.
The Rocket, by the way, will cost 99.99 with a two-year contract; the outright purchase price wasn't announced.
Of course, the carriers have risks in carrying your subsidy over two years, plus early cancellations, the costs of churn, and so forth. By having you pay upfront, they don't carry the cost on their books, and it likely on average costs them less to handle you as a customer.
Posted by Glenn Fleishman at 10:35 AM | Permanent Link | Categories: 2.5G and 3G | No Comments
Virgin Mobile is keeping its pricing tiers for its pay-when-you-need it broadband service, but bumping up included quantities of data: Virgin Mobile, now part of Sprint Nextel, has a unique 3G service, in which you can pay for limited amounts of data for limited periods of time. No contracts, and no other fees. And the division is upping the amount of data at each tier starting this morning.
Formerly, you could pay $10 to use up 100 MB within 10 days; with a 30-day usage period, you could pay $20 for 250 MB, $40 for 600 MB, and $60 for 1 GB. There are no overage fees because you are prepaying for a specific quantity of service. If you need more, you just buy another chunk.
The revised plan sticks with the $10/100 MB/10 days tier, but ups the data for each 30-day usage option: $20 gets you 300 MB (only a 50 MB increase), $40 gets you 1 GB (up 400 MB), but $60 now covers 5 GB or 400 percent more usage.
The $60 plan is identical in cost and data quantity to the contract-based 3G laptop service provided by AT&T, Sprint Nextel, T-Mobile and Verizon Wireless, but there's no commitment. (T-Mobile also allows you to pay full price for a USB modem and then pay on a month-by-month basis.)
I suspect Virgin bumped up these numbers because as a better deal it encourages more regular purchases without feeding out much more data. I suspect most people paying for 1 GB never reach that total, and that offering 5 GB won't encourage much more consumption relative to the jump in usage.
Just as carriers have all seemed to spawn prepaid, supercheap voice offerings--all fees are collected before usage--I expect we'll see more prepaid 3G, too. Postpaid plans are supposedly billed after the fact, but all the voice and 3G data contracts I know of required a month's advance prepayment of subscription fees, but allow you to run a tab for overages during the month of usage and then pay for those. Hardly postpaid, despite the definition of postpaid.
The plans all require the $100 Broadband2Go USB Device (a Novatel Ovation MC760 with microSD slot). The USB modem works over Sprint Nextel's network at EVDO Rev. A speeds where available, and supports several Windows flavors and Mac OS X 10.3 and later. (Some commenters on Virgin's open-answer FAQ say 10.4 is the minimum supported version.)
Posted by Glenn Fleishman at 4:31 AM | Permanent Link | Categories: 2.5G and 3G, Unique | No Comments
While T-Mobile's UMA offering has been around for years, Cablevision may be trying something new: Cablevision's COO mentioned in the company's earnings call today that the firm is testing phones that will switch seamlessly between cellular and Wi-Fi networks. That sounds an awful lot like UMA (unlicensed mobile access), a standard used for roaming by T-Mobile in the US and several carriers around the world.
T-Mobile offers UMA because it lets them leverage other companies' broadband and its network of home and roaming Wi-Fi networks. T-Mobile operates relatively few hotspots now compared to when it was anchored by Starbucks, but the key to UMA is voice over Wi-Fi over a wired or wireless broadband connection at home.
Cablevision has an even easier time of it, because it provides its CT/NY/NJ Wi-Fi network only to users that subscribe to its home cable broadband service. So any phone it offers can carry voice over Wi-Fi at home over its cable network and outdoors over its Wi-Fi network. In the past, Cablevision has partnered with Sprint for wireless service. However, I'm unaware of any production UMA gear that would work on Sprint's network.
The notion of UMA is to reduce the cost to a carrier of subscribers while providing subscribers with more unrestricted minutes. T-Mobile's plans, for instance, offer unlimited domestic calling over Wi-Fi even for plans with modest numbers of cellular minutes. This keeps customers loyal and happy with a lower cost structure. Femtocells have the potential to offer similar advantages to T-Mobile's competitors, but none are being priced or marketed in that way yet.
Posted by Glenn Fleishman at 2:57 PM | Permanent Link | Categories: 2.5G and 3G, Voice | 1 Comment
Clearwire says it's on track for 120m people passed in 2010; beyond that, more money needed: paidContent.org runs down Clearwire's earnings news, with the firm bringing in $80m in revenue, but a loss of nearly $100m. Subscribers stand at 688,000. The company will spend about $3b in 2010 to get to its target of 120m people to whom service would be available. But if the network is to grow any bigger, more cash is needed.
In contrast, T-Mobile has crossed 200m already in upgrading its 2G network to add 3G, and it's ostensibly on track to something approaching AT&T (233m) or Verizon (280m) levels. (Yes, those Christmas ads in which Verizon said it has the biggest 3G coverage are correctly, but the 50m gap is in small towns; AT&T has the big markets.)
Clearwire is leaning on Sprint for its fallback position, Sprint being the majority owner of Clearwire. If you get a combo 3G/4G USB modem or portable 3G/4G-to-Wi-Fi gateway, you can use 3G (up to 5 GB on Sprint's network) when away from a Clearwire area, and 4G in the footprint.
But Sprint has underspent on 3G. The company reports (the latest number I could find) 270m people passed with 3G with roaming. That's a critical point. Compare Verizon's native coverage map with Sprint's map, where Sprint shows gray for roaming, orange for 3G and tan for 2G:
And here's Verizon's, where dark blue is 3G, green is 2G, and yellowish is roaming:
Sprint has the big cities, sure, but it doesn't disclose its non-roaming footprint, and it limits 3G customers to no more than 300 MB per month of roaming data, after which point it can choose to cancel a mobile broadband contract.
Posted by Glenn Fleishman at 1:34 PM | Permanent Link | Categories: 2.5G and 3G, 4G | No Comments
AT&T didn't want to let T-Mobile steal the initiative on HSPA 7.2: I missed the 5 January 2010 release from AT&T that explained the firm had updated its mobile broadband network to HSPA 7.2; T-Mobile said last week its entire footprint is now HSPA 7.2 as well.
AT&T said last year that it would roll out the 7.2 update--which offers a raw data rate of 7.2 Mbps including network overhead--to most sites by the end of 2010, and its entire footprint by 2011. In Europe, HSPA 7.2 networks seem to operate in a broad range: users report regular performance from about 1 to 4 Mbps. It's unclear how carriers will provision, throttle, or shape HSPA 7.2 here.
AT&T's announcement coming early made it seem like it might have leapfrogged T-Mobile, given that AT&T has more metro areas covered with 3G, and has already sold a fair amount of HSPA 7.2 enabled gear, such as the iPhone 3GS. But that's not the case.
AT&T wasn't trying to pull a fast one, even though it was marketing this move as an enhancement. In the 5 January press release, the company makes it crystal clear that it's upgraded the software to allow HSPA 7.2 even though it doesn't have the necessary backhaul improvements in place to make the network actually faster.
This is refreshingly frank. The release said that the software update would improve network quality even before backhaul improvements that are slated for this year and next are in place to provide increased capacity. I'm sure AT&T is correct. More efficient use of the local link among capable devices means less wasted air time and less congestion, which allows better packet shaping and prioritization. I'm sure local network links function far better at 7.2 Mbps, even if the backhaul can't support the uplink side.
Six cities have the promised backhaul improvements underway: Charlotte, Chicago, Dallas, Houston, Los Angeles, and Miami. The release says the updates are site by site, which means you could experience different speeds driving around the same city while the upgrades are in process.
T-Mobile, on the other hand, has been building its fresh HSPA network with the notion that backhaul for HPSA+ (21 Mpbs in its version) will be flooding the grid, and thus has the advantage of not having to deal with legacy installations. It has been able to make all its choices about towers with the notion that each base station may need 20 to 100 Mbps of backhaul. (These are guesses; the company hasn't released that information.)
I continue to find it ironic that wireless networks rely so heavily on wires.
Posted by Glenn Fleishman at 4:37 PM | Permanent Link | Categories: 2.5G and 3G, Future | 1 Comment
T-Mobile is trying to seize its HSPA+ momentum: The fourth-ranked carrier by subscribers in the US, T-Mobile is trying to establish an advantage through its fast deployment of 7.2 Mbps HSPA followed this year by 21 Mbps HSPA+. But you need the proper hardware to go with that faster network, and today's announcement of the webConnect Rocket USB Laptop Stick (no pricing yet) is signaling more to come.
The modem won't ship until March, and HSPA+ is available only in Philadelphia so far. T-Mobile said it will focus on bringing HSPA+ to the coasts first, and then move inland. In an interview, T-Mobile said it would have the "majority" of its footprint upgraded to HSPA+ in 2010.
The company also stressed its work on backhaul improvements, a bane of the mobile broadband industry. You can have as much bandwidth as you want on the local link between devices and the tower, but then you have to offload that to a core network. Many cell sites had paltry backhaul and it was difficult to bring in more. T-Mobile promised me more details soon, but the company recognizes that you can't advertise a raw rate of 21 Mbps--probably 5 to 7 Mbps to individual users--without having invested on the backside, as AT&T has learned to its high discomfort.
T-Mobile would like bragging rights for having the fastest network, although even with the latest market rollouts, it's still covering just over 200m people in approaching 300 cities. AT&T, by contrast, even with its smaller-than-Verizon 3G footprint has 350 metro areas (not just cities) with 3G service, although AT&T doesn't seem to discuss people passed with service.
I keep pressing T-Mobile on its 5 GB monthly bandwidth limit included with all its 3G plans as it discusses HSPA+ plans. The 5 GB limit was a quiet or explicit limit before 3G networks could routinely deliver over 1 Mbps (back in the EVDO Rev. 0 and GPRS/UMTS days), and now it seems quaint even for EVDO Rev. A and regular HSPA.
Why give people HSPA+ when, at full speed, they could use up their entire monthly allotment in just over two hours (assuming 5 Mbps average speed)?
So far, T-Mobile just repeats that most of its 3G users consume just a fraction of the 5 GB to which they are entitled each month.
Posted by Glenn Fleishman at 6:29 AM | Permanent Link | Categories: 2.5G and 3G, Cellular | No Comments | No TrackBacks
Apple's 3G iPad models will come with two unique aspects: only unlocked, no-contract services: It's not surprising that Apple will have Wi-Fi only and Wi-Fi plus 3G variants of its new iPad mobile device. Rather, it's that Apple finally got its demands met about how consumers will control the relationship with cellular carriers.
The iPad will come with a micro SIM, a new tiny form factor for SIM in mobile devices that's not yet in real use, as far as I can tell. (I had never heard of it before today, even though it's a settled 3GPP format.) Steve Jobs said it will be simple to swap out SIMs from other carriers, so that the US version of the 3G iPad will "just work" in most cases outside the US. It won't be until June or July that Apple has carrier relationships for direct sales and data plans other than in America.
The unlocked iPad will be coupled with two data plan options from AT&T, neither of which requires a contract or (as far as I know so far) any cancellation penalty. AT&T has some services now that you can turn on or off on demand, such as navigation.
The 250 MB/mo. plan is $15/mo; the unlimited plan is $30/month. While you might scoff at 250 MB, the iPad will have the same limitations as the iPhone in terms of downloading and storing stuff over the Internet, so outside of purchasing movies, the biggest 3G drain will be streaming video. Because the iPhone OS doesn't support Flash, streaming video must all be embedded H.264 format or accessed via the YouTube app or other applications.
I'm calling the 250 MB/mo plan "your mother's plan," because it's most likely to appeal to people who won't be heavy 3G users, and will mostly use the device over Wi-Fi at home or at hotspots. However, they will want the flexibility of having 3G available wherever when they carry the device with them.
The iPad still is slated to have the disappointing pairing of UMTS for upload (384 Kbps) with HSDPA for download (ostensibly HSPA 7.2 as with the iPhone 3GS); this detail is noted on the Tech Specs page for the iPad. The iPad will likely be a heavier producing device, especially given that there's a camera connection kit (USB or SD card reader) that will let you suck photos directly into the iPad. These will sync with iPhoto when you return to a Mac (or through other means specified in iTunes on a Mac or under Windows), but uploading photos during a trip will certainly be desirable, and limited over 3G networks to the paltry 384 Kbps rate.
I should note, of course, that the iPad will have 802.11n support, but it's unknown to me yet whether this will be a single-stream radio, which would use less juice and thus be more sensible in a device intended to have a long battery life, or a two-stream 802.11n adapter, which will drain it faster. Apple uses USB for syncing large amounts of content, and doesn't provide over-the-air sync for anything directly. (You can use its MobileMe service to sync calendars and contacts.)
That means that the gating factor on most networks will be the Internet connection, not the wireless LAN. Having a 50 Mbps or so top rate with 802.11n single stream won't really be a clog on the iPad's abilities.
Posted by Glenn Fleishman at 7:06 PM | Permanent Link | Categories: 2.5G and 3G, 802.11n, Future, Gadgets | No Comments | No TrackBacks
From a carrier with no 3G offerings 18 months ago, T-Mobile has turned the ship fast--and turned the table on its competitors: T-Mobile used today's announcement of a new 3G USB modem to lay out its aggressive plans for 7.2 Mbps HSPA and 21 Mbps HSPA+ deployment nationwide.
Starting from no customers in second quarter 2008 and clutching a handful of 3G spectrum, the firm now covers 240 cities and passes 170m people. T-Mobile's Jeremy Korst, director of broadband products and services, said in an interview that the number will hit 200m by the end of 2009, which covers nearly all the major urban areas. By contrast, Clearwire plans coverage of 120m people with its Wimax service by the end of 2010.
But perhaps more important is that T-Mobile will have 7.2 HSPA, which runs at a raw downstream data rate of 7.2 Mbps, on all its 3G nodes by year's end. On the upstream side, T-Mobile will gradually upgrade to 2 Mbps starting in early 2010.
This contrasts with AT&T's previously announced but much more moderately paced plan that gradually upgrades the current, seemingly overloaded 3.6 HSPA network to 7.2 HSPA through the end of 2011, at which point AT&T will still have only 90-percent 7.2 HSPA on its 3G network. By the end of 2010, only 25 of 30 major markets will have the faster HSPA flavor, the company has said.
The bigger news, though, is that T-Mobile is going full-court press on HSPA+, a 21 Mbps flavor already deployed by several carriers worldwide, and which T-Mobile launched for test purposes in Philadelphia in September. The company will start rolling out HSPA+ in 2010 on a "fairly broad-scale" basis, Korst said.
Read the rest of "T-Mobile Moves Aggressively into HSPA and HSPA+"
Posted by Glenn Fleishman at 9:05 PM | Permanent Link | Categories: 2.5G and 3G, 4G, Broadband Wireless, Cellular, Future | 1 Comment
AT&T is suing Verizon over a snarky campaign that compares Verizon's 3G coverage to AT&T's: Is this unfair? It's maybe impolite, but it doesn't appear unfair or incorrect. Is it actionable? AT&T says the ads will make customers believe AT&T has no coverage whatsoever, not just no 3G data coverage, in the white areas in the AT&T map displayed. And the map is from a few months ago, while AT&T has built out a bit more blue in that time. (AT&T isn't complaining about the accuracy of the map's depiction of 3G.)
Fundamentally, though, we're seeing a battle between the last advantages of the Qualcomm EVDO standard compared to the GSM evolved HSPA family of standards. When Verizon installed 3G, the company did it in a big way, upgrading a large majority of its 2G 1xRTT nodes to EVDO Rev. 0, and later pushing those to Rev. A for the current footprint and speed. Sprint did likewise.
Verizon had to, because AT&T and T-Mobile had intermediate 2.5G and 3G steps that would have left Sprint and Verizon at a competitive disadvantage. AT&T and T-Mobile pushed out EDGE, which is several times faster than 1xRTT (which runs at fast dial-up modem speeds), and did so relatively inexpensively. AT&T Wireless and Cingular, at the time separate entities, had distinct plans to test and deploy UMTS, the 384 Kbps low-end 3G standard on the road to HSPA. (GSM 3G HSPA standards are broken down into downlink and uplink and there are flavors and steps there, but it's nice to just say HSPA to encompass the realm.)
For AT&T, EDGE was good enough outside metro areas, because it competed effectively with 1xRTT before Verizon and Sprint had a full EVDO footprint (even with Rev. 0). The company then essentially stalled because of first the Cingular/AT&T Wireless merger, and then the 60-40 ownership split between what was then SBC and BellSouth. The two companies didn't see eye-to-eye on spending on 3G. AT&T's 3G plans really only took off after the BellSouth merger, which also gave it 100-percent control of the cellular division. Any rational wireless firm would have spent billions during the good times to get a competitive 3G footprint with the CDMA competitors.
If Verizon and Sprint had limited 3G upgrades just to major metropolitan areas, they would have been way behind the ball--and AT&T would be running ads now laughing at the companies' sub-EDGE speeds in the country, and slower than HSPA rates in the city. (T-Mobile dropped out of this speed war for a few years while it acquired 3G spectrum and deployed its HSPA offering. The firm intends to have the fastest 3G network while 4G networks are being built with a test of 21 Mbps HSPA already underway.)
Verizon has to be aggressive right now, because it's switching to LTE for its 4G network, a GSM-evolved standard. It will be years before it has a national footprint for 4G using LTE (over 700 MHz spectrum). During that time AT&T will have bumped its 3G network nationally to 7.2 Mbps HSPA, and potentially even going to 14.4 Mbps HSPA (that requires more hardware upgrades, so hard to tell), and also pushing out LTE over 700 MHz.
In a couple years, AT&T will have the bragging rights on speeds, will start having a better 3G and 4G map to compare with Verizon, and Verizon will seem like the sucker. At least briefly.
Posted by Glenn Fleishman at 2:42 PM | Permanent Link | Categories: 2.5G and 3G, 4G | No Comments
The ability to use VoIP over 3G and Wi-Fi turns iPhone into more powerful tool: AT&T, under pressure from the FCC to explain precisely why the iPhone can't place VoIP calls over 3G when its other smartphones can, reversed its previous policy. Apple will be updating its App Store rules to let developers run VoIP connections over any available network medium, not just Wi-Fi.
This change is a big one for AT&T, which I'm sure wrestled with lawyers, spreadsheets, and customer surveys before implementing the move--a move which could have been forced on the firm by the FCC.
And I think it's a good one for AT&T, despite the potential loss of revenue.
Why? Because it's yet another tool for customer loyalty to a company whose 3G network has delivered sub-par performance. I've been generally satisfied with AT&T's service, but I don't live in areas of weak coverage, and I don't travel extensively. (Two recent trips of hundreds of miles each across rural and highway portions of Oregon and Washington were generally satisfactory.)
In fact, AT&T turning on 850 MHz base stations in Seattle has distinctly improved my iPhone phone and data experience, especially in my house.
The move to allow VoIP over cell data means that iPhone customers can turn to Vonage Mobile, Skype, or other programs in new versions to make calls outside the U.S. at rates that aren't insanely high, and can downgrade subscription plans to have fewer minutes in the plans, relying more on VoIP for domestic calling.
But if you look at subscription trends already, this isn't as disruptive as it looks. I have no idea how many people pay AT&T's wireless international rates; perhaps billions are spent, but the costs are so high, I have to believe that most people are motivated to use calling cards or other solutions, which have included VoIP over Wi-Fi with Skype on the iPhone.
AT&T already offers rollover minutes, free evening and weekend calling, and free mobile-to-mobile calling as part of its cheapest postpaid plans. For most iPhone customers, AT&T gets a minimum of $75 per month ($40 voice, $30 data, $5 for the cheapest IM package); multi-line plans with two phones start at $120 ($40 voice, $10 extra line, $60 for two data plans, $10 for two IM plans).
For $100 per month, you can get unlimited voice from AT&T, so that's maybe the biggest competition for the firm: the $60 difference between a limited-minutes $40 plan and unlimited $100 plan.
However, never forget that the cost of customer churn and acquisition (and re-acquisition) is exceptionally high in the cellular industry, racking up hundreds of dollars per customer between advertising, subsidies for new phones, and company stores or commissions to independent stores.
If AT&T ups its iPhone customer retention rate by a measurable amount, the company likely saves more than the difference, and achieves better costs of scale, too.
Also remember that every minute someone uses a VoIP service over Wi-Fi is a minute that AT&T doesn't have to pay for (or pays very little for at its hotspots), and doesn't have to provide customer service for. Every minute of VoIP over 3G requires the firm carries roughly the same data traffic with none of the responsibility for call completion, billing, fee settlement, or customer support.
AT&T may actually benefit quite a bit from this change in policy, which may be why it didn't opt for prolonged legal action.
Posted by Glenn Fleishman at 1:43 PM | Permanent Link | Categories: 2.5G and 3G, Cellular, Voice | 2 Comments
AT&T inches closer towards broad availability of its femtocell: Details of 3G MicroCell, an in-home base station for the AT&T network, have been floating around for months. What wasn't known was when the company was planning to expand its test program into commercial availability. With the launch of a detailed Web site describing all the advantages--but also with a Zip code availability checker--the company is moving far closer to release. (Update: Charlotte, N.C., is the first test market.)
The idea of a femtocell is to have a broadband-connected tiny base station in the home that allows an existing cellular handset to work without any modification. Sprint pairs its femtocell with an unlimited call options ($100 purchase price plus $5/mo for the base station's use and $10 additional/mo for unlimited calls). Verizon offers just the signal-strength improvements ($250). T-Mobile employs UMA, which requires one of many dual-mode UMA handsets that the company offers, but works over plain Wi-Fi.
The 3G MicroCell is unique in that Sprint and Verizon's systems support just 2G voice only. AT&T is a smartphone and calling adjunct, although most smartphones that the company sells include Wi-Fi, and thus the data side isn't very important to most home users. Better call quality and unlimited home calling are the big carrot.
Engadget has a price sheet which shows calling plans at $10/mo (for one or more cellular phones) for existing AT&T wireline customers, and $20/mo for everyone else. The base station is $150 if you want it just for coverage; $50 ($100 rebate) if you sign up for the service plan. (The pricing is apparently a test, too, however.)
That's relatively competitive to Sprint ($15/mo) and T-Mobile ($10/mo), and cheaper than Vonage or Comcast VoIP. Further with VoIP services, you pay per line available; with the AT&T option (as well as Sprint and Verizon) multiple cell phones can place calls at the same time, which gives you a form of multi-line service.
AT&T gets a huge benefit from femtocells, extending its market into homes where its cell service can't reach or reaches poorly, while offloading potentially large amounts of home calling from its network to broadband.
Posted by Glenn Fleishman at 10:41 PM | Permanent Link | Categories: 2.5G and 3G, Cellular, Voice | No Comments | No TrackBacks
The WSJ writes of the low rate of adoption, interest in femtocells: I've long been a bear about femtocells, short-range indoor base stations designed to extend cellular networks to the home or small office, allowing the use of unmodified mobile handsets. Femtocells seem to be a way for carriers to bring their business into your home, instead of you gaining more control over your calling.
T-Mobile steered a different course years ago, signing on to the unlicensed mobile access (UMA) standard, which allows a handset to negotiate seamless during-a-call handoffs between a mobile network and a Wi-Fi network. T-Mobile had to introduce new handsets that include UMA software and Wi-Fi radios; the firm now has 10 such models which are priced like models without UMA.
Femtocells require no handset updates. A customer obtains the base station, plugs it into their broadband connection (just like UMA, the carrier doesn't pay for the call backhaul), and then unwinds up to 30 feet of GPS antenna. Femtocells have to have a precise location both to use the correct licensed frequencies for that area and to assist in meeting E911 call location requirements. (In fact, femtocells may help carriers meet those obligations well enough to offset worse performance elsewhere.)
But where T-Mobile paired UMA with a cheap, unmetered calling plan--now costing just $10 per month for 1 or more lines--Sprint's femtocell costs $100 and $5 per month plus a $10 per month fee for a single unmetered line. Verizon charges $250 with no monthly fee nor calling discounts. (AT&T's femtocell is still in testing in limited markets, and may have an unmetered plan associated.)
Further, T-Mobile counts all calls that originate on a Wi-Fi network under its unmetered plan, and allows you to use any qualified hotspot: any one for which you have access or a password, or that's part of its large aggregated HotSpot roaming footprint. If you receive a call or place a call over Wi-Fi, you can walk away onto the cell network and not have minutes apply. For Sprint, minutes are unmetered only when at the femtocell, and, as noted, Verizon doesn't engage in that at all.
Because T-Mobile relies on Wi-Fi for data, the speed that your handset can access the Internet is only limited by your broadband connection and the quality of the Wi-Fi network. Verizon and Sprint are shipping 2G-only femtocells, which means that handsets with 3G but no Wi-Fi would be severely cramped. AT&T will offer 3G service with its femtocell--but 3G drains a battery far faster than Wi-Fi does on a mobile device. You'll need to keep your iPhone or other phone plugged in to use it effectively in your home as a landline replacement. (AT&T's devices should be able to switch to Wi-Fi for data while making 3G calls, however.)
The cost of femtocells, where we're now a good year into real worldwide availability, is still far too high relative both to their utility and substantial deployment. Yes, that can drop via volume, but Om Malik points out that with only 20m femtocells predicted to be sold worldwide in 2012 (and 800K worldwide this year), the amount of investment in femtocell makers is far outstripped by the potential for revenue. That's a recipe for consolidation and closure.
Femtocells benefit a carrier by allowing customers to get coverage where they cannot, and offloading cell tower usage to a device that the customer has paid for or leases. Some reports have suggested that carriers should give away femtocells because the reduction in infrastructure buildout through heavy in-home use would be far cheaper than the cost of the femtocells.
Honestly, given the costs, limitations, and complexity, I'd rather simply use Skype on my iPhone over my home Wi-Fi network rather than a femtocell.
Posted by Glenn Fleishman at 11:21 AM | Permanent Link | Categories: 2.5G and 3G, Voice | 2 Comments
Sprint Nextel will acquire the majority stake in Virgin Mobile USA that it doesn't own: Virgin Mobile was the last major mobile virtual network operator (MVNO), a cellular company type that owns customers not cell towers. While there have been attempts to create large MVNOs, only Virgin Mobile has remained viable, although not wildly profitable. Sprint was an investor in Virgin Mobile, and many said that was what gave the MVNO staying power. Most recently Virgin Mobile absorbed Helio, an MVNO started by SK Telecom and EarthLink to bring advanced phones from South Korea to the U.S. market and target services at younger folk.
Virgin Mobile concentrates on prepaid phone service, which is distinct from the postpaid contract offerings that require long commitments. With prepaid service, you pay in advance for minutes or no-contract subscriptions, and wind up paying substantially less. Virgin Mobile has a $50/mo unlimited talk plan, which contrasts with postpaid plans that are twice as much. (Virgin Mobile requires 2-year commitments on smartphones under the Helio brand, however.)
The company also has the only pay-as-you-go mobile broadband service. You have to pay upfront for a $150 USB 3G modem--sold exclusively by Best Buy for Virgin Mobile--and then service has no commitment. You buy pools of expiring bandwidth. $10 gets you 100 MB over 10 days; $20, $40, and $60 get you 250 MB, 600 MB, and 1 GB over 30 days. If you need more bandwidth, you buy another pool--no sneaky $50/MB overage fees.
While the broadband prices are high compared to Wi-Fi (Boingo with $10/mo unlimited North American hotspot access, for instance), they are extremely favorable when looking at major carrier 3G plans, which are $60 per month with a required 2-year commitment. Those plans, however, top out at 5 GB of use per month.
The biggest segment of growth for Sprint is prepaid plans, but it's sold such plans on its iDEN network, the old Nextel technology that will some day fade away. Virgin Mobile uses regular old CDMA, and brings over 5 million customers.
Posted by Glenn Fleishman at 9:09 PM | Permanent Link | Categories: 2.5G and 3G, Cellular | No Comments | No TrackBacks
Verizon will provide its medium-and-faster-speed DSL and fiber (FiOS) customers with free national Wi-Fi hotspot access: The service, provided by Boingo and rumored to be in the works earlier this year, allows Verizon to match some of Cablevision's offer in overlapping territory, but to also compete with cable operators and future competitive services elsewhere. The directory is available, but lame.
Cablevision has committed $300m to a tri-state (NY, NJ, and Conn.) buildout of outdoor Wi-Fi to its broadband customers in those same states. Verizon, in contrast, has turned to Boingo Wireless to provide service. Boingo couldn't comment on particulars, but said the deal applied to all Verizon business units; Boingo's previous contract was just with Verizon's business group.
Software is required to access the network. Verizon customers have to log in at verizon.net to download the package. It's likely a private label version of Go Boingo, the lightweight software that the aggregator switched to that automatically recognizes and offers to log in to Boingo-affiliated hotspots. It's available for Mac OS X and Windows. Update: Correction! Boingo's software is Mac and Windows compatible; Verizon's private-label software is currently available for Windows XP (32-bit) and Vista (via @siracusa).
Verizon customers with the cheapest flavors of DSL (slower than 3 Mbps) and FiOS (slower than 20 Mbps) don't get the service. AT&T once divided its customers for free Wi-Fi, too, but eventually (and quite a while ago) simply gave it away. It wasn't an incentive for upgrades, clearly, so why bogart it.
(There's a sideshow going on about an Apple tablet that would be exclusively introduced by Verizon late this year or early next that would have 3G and Wi-Fi access. I don't buy it. I can't see a tablet with 3G, because that would limit sales to those willing to pay a large monthly fee. It's much more likely Apple would release a large iPod touch with Wi-Fi only.)
Now in a bit of what you could call a business conflict, Boingo resells AT&T's Wi-Fi service. IDG News Service noted that Boingo had 30,000 hotspots in the US, and that only 7,500 of those were from AT&T's network, which doesn't make sense. AT&T operates nearly 20,000 locations; 7,500 would represent all the Starbucks outlets. JiWire shows 65,000 hotspots in the U.S., but that includes free locations, such as libraries and chains that aren't incorporated into roaming deals.
IDG was told by Boingo and Verizon that some locations wouldn't be available, but wouldn't specify how many. When I check Verizon's hotspot locator, Starbucks locations are included, as well as Barnes & Noble, also operated by AT&T. In fact, in Washington State, I had trouble finding anything but B&N and Starbucks.
Since the announcement was made, we assume that all is well, but there has to be some chafing at AT&T, since it wouldn't want to enable its biggest cellular competitor.
This initial announcement only covers Verizon broadband, not Verizon Wireless phones and customers. That might be in part because of this conflict, but I don't know anything concrete. Offering free national Wi-Fi coupled with 3G service (whether laptop or smartphone) would be a good move for Verizon, even as the company requires that all future smartphones include Wi-Fi.
While Wi-Fi is a cheap way to offload data use from expensive and sometimes congested 3G networks, Verizon has long been a doubter. It's late to the game here, with no investment of its own, and thus has to bleed money out to offer the service, beholden to other firms and even AT&T nearly directly. Cablevision and AT&T have their operations in house, facing capital and operating expenses, but being able to adjust and conserve those. AT&T even further collects revenue from walk-up customers and non-landline/3G subscribers, too.
GigaOm's Om Malik makes the reasonable suggestion here: maybe Verizon should buy Boingo? In fact, when I was briefed by Boingo, my first comment was, "You're calling to tell me that you were bought by Verizon?"
Posted by Glenn Fleishman at 10:20 AM | Permanent Link | Categories: 2.5G and 3G, Cellular, Hot Spot | 4 Comments
Sure, Clearwire has Baltimore and Portland, but Atlanta eclipses those: The Clear network in Atlanta spans 1,200 sq mi and passes 3m people. Given the hideous commute and highway backups, I can see a ubiquitous network that's cheaper than and faster than 3G competitors being a windshield warrior and mobile work team must-have. Clearwire maintains that 4 to 6 Mbps downstream is typical, with an over 15 Mbps burst rate.
Clearwire pairs the Atlanta announcement with a laundry list of gear customers can use to connect, which has increased considerably in the last few months.
Wireless networks are always a chicken-and-egg problem. Wi-Fi insinuated itself into nearly every mobile device because there was no network lock in. You could install one hot spot and have one adapter and have all the freedom you needed to cut the cord. Wi-Fi became cheap to include in mobile devices years ago, and required no carrier or regulator relationship.
Cellular 3G and 4G networks have a harder row to hoe because every adapter will have both high cost and provider lock in. 3G cell modems are starting to become a standard feature on some netbooks and laptops, although it's a financial risk to the makers of these computers, as the underlying cost of mobile broadband modems remains high. If the user never activates the modem, or cancels within a short period, the buyer isn't bearing the full cost of that adapter based on the current model. (It's not clear whether carriers and/or modem makers absorb some of this risk to ship more adapters and gain more customers, too.)
For Clearwire, it's a bit different, because Motorola and Samsung are both major investors and principle equipment manufacturers. This can be awkward, because the two makers can't offer gear to Clearwire at cost, but neither do they have a motivation to extract every last dollar.
Clearwire notes in this release how many WiMax adapter are now available, and in what variety. For laptops, there's a $60 (or $5/mo) USB modem. This takes care of legacy laptops and even desktop computers. USB modems for 3G networks have multiplied and added features (such as having a microSD slot) because the ability to move the modem among multiple computers is desirable.
For home users, there's the Clear Residential Modem, which is $80 or $5/mo; voice calling requires an additional $15 adapter and a $25/mo calling plan (competitive with Vonage, and from half to one-third less than Comcast's).
Apparently, this is the soft launch of Clearwire's Clear Spot, a Wi-Fi/WiMax gateway ($140), which is battery powered and requires a Clear USB modem. As I previously noted ("Clearwire Offers CradlePoint WiMax/Wi-Fi Hotspot," 31-March-2009), this is a Clearwire-enabled version of a product that CradlePoint has offered for some time. On the laptop side, Clearwire lists a variety of Dell, Fujitsu, Lenovo, Samsung, and Toshiba notebooks and netbooks. A Panasonic Toughbook is coming later this year.
An anticipated 3G/4G broadband modem is due "this summer," which will combine Sprint 3G with Clearwire WiMax, and start allowing business customers in Clear coverage areas to upgrade to have the benefit of a faster network at home and roaming while away, or in weak WiMax coverage areas.
Posted by Glenn Fleishman at 11:34 AM | Permanent Link | Categories: 2.5G and 3G, 4G, WiMAX | No Comments
AT&T releases a pile of news about how it plans to deal with current, future 3G bandwidth needs: I have to credit AT&T for its comprehensive announcement about what it's up to today to improve its network, and its plans over the next few years as 3G use will likely increase dramatically, and it starts to roll out LTE, a 4G network technology.
There's a lot of geekiness in this press release. The company provided some updates on its 7.2 Mbps upgrade plan. The HSPA (high speed packet access) technology it uses, part of the GSM roadmap, is currently limited to 3.6 Mbps. The 7.2 Mbps flavor isn't in wide use worldwide, but it's starting to kick in as demand from smartphones and mobile broadband users with netbooks and laptops steps up.
The timing is clear: Apple is about to release a revised iPhone, one that various usually reliable sites report will record video, take larger pictures, and have a faster processor. It will also almost certainly contain a 7.2 Mbps HSPA chipset, and thus be a huge and immediate drain on 3G resources across AT&T's territory. (Apple's developers conference is in two weeks, at which time the company will likely announced that the iPhone 3G+ and its iPhone 3.0 software will be released in July.)
AT&T's CEO said at the All Things D conference run by the Wall Street Journal this morning, in reference to Wi-Fi that there's a growing "bandwidth requirement," and that mobile broadband has to meet what fixed-line (fiber/DSL/cable) services can provide. Wi-Fi is a "bridge," he said, and AT&T can back its 20,000+ Wi-Fi hotspots with fixed-line services. But obviously the company also has to beef up mobile broadband, too. (The 20,000 count is new; it was about 17,000 not too long ago.)
In order to support the 7.2 Mbps HSPA service and future LTE, AT&T says it's doubling the amount of bandwidth devoted to 3G in many metropolitan markets, and bringing more backhaul to "thousands of cell sites." The company couches its backhaul statement by saying "fiber-optic connectivity and additional capacity," meaning it's not bringing fiber to thousands of cell sites, but to some of them.
The company will also add 2,100 cell sites to improve density. The greater the density, the smaller the cells, and thus the fewer devices that connect to each cell, increasing frequency reuse over a given area.
AT&T is also expanding its use of 850 MHz, which has better penetration to interior spaces, and can cover more area from a single base station. That's a smart move to counter some of the CDMA advantage in the U.S., where Sprint and Verizon seemingly have better network coverage. (AT&T's network was built up as more of a patchwork in many ways, and AT&T still lacks its own coverage in some small but significant parts of the country.)
On the Wi-Fi side, AT&T says it will offer seamless Wi-Fi/3G switching on "many" smartphones. That might be a reference to a capability that could be part of the iPhone 3.0 software due out perhaps as soon as July. AT&T currently has a very silly SMS-based notification system to get a code that allows free access, although Devicescape's Easy Wi-Fi for AT&T (99¢) automates the process. (It's a mystery that AT&T didn't either license and distribute that software from Devicescape or develop its own similar approach.)
A bit buried at the end of the paragraph is rather fascinating: "AT&T also can create permanent or temporary extended Wi-Fi zones in areas with high 3G network use, like a grouping of hotels or a festival." Fascinating. This is an interesting admission of scarcity coupled with AT&T's fixed prices for smartphone 3G use (as opposed to 5GB/mo limits on laptop 3G connections).
Wi-Fi's key advantage and problem is its low power, which both allows and requires a honeycomb of tiny radius cells. In a dense area with lots of usage, AT&T could push in dozens of Wi-Fi access points tied into a fiber network and overlay gigabits per second of additional capacity without stressing the 3G infrastructure. I've never heard of a carrier suggesting that they might do this before, however.
AT&T also said in this release that it's working towards releasings its 3G MicroCell, a femtocell product that's been talked about widely and is in some test customers' hands. It's still not clear whether AT&T will follow the Sprint model of adding a fee for unlimited monthly incoming calls and U.S. outgoing calls, or the Verizon model of paying a large fee for the femtocell, and gaining only indoor coverage improvement. AT&T is unique at this point is having a 3G femtocell for voice and data; Verizon and Sprint's system's are 2G and voice only.
Posted by Glenn Fleishman at 10:33 AM | Permanent Link | Categories: 2.5G and 3G, 4G, Hot Spot
Qualcomm opens research labs in video tour to show next-generation distributed tech: Qualcomm engineers have determined an optimal way to use flocking behavior to have mobile aerial femtocells that can expand coverage. There are a few downsides to the technology, which the company is remarkably forthcoming about.
I'm sometimes critical of Qualcomm for its market behavior, but the company has certainly transformed itself lately into a new sort of creature, which this video helps demonstrate.
Posted by Glenn Fleishman at 1:42 PM | Permanent Link | Categories: 2.5G and 3G, April Fool's
Why should AT&T be excited about Skype for iPhone: Because all of us iPhone users are paying minimum fees for service that we will use less and less in favor of Skype. The free Skype for iPhone application, due out tomorrow, will only work over Wi-Fi. (PC World has a full report including screen captures.)
Skype has 400 million users worldwide, and the voice quality tends to be better than that of the conventional POTS (plain old telephone service) or cellular network when there's sufficient bandwidth. With a user base that large, with a mobile version of Skype you're more likely to make Skype-to-Skype calls (which are free).
AT&T enabled the Wi-Fi part of this equation by belatedly offering free Wi-Fi for iPhone users to any of the nearly 20,000 in-network hotspots the company operates. AT&T acquired Wayport, its managed services provider for Wi-Fi hotspots, last year. This puts McDonald's, Starbucks, a number of hotels, and some chains under one plan, all free to iPhone users. (iPhone users should download and use Easy Wi-Fi for AT&T iPhones, a currently free app from Devicescape for automating your hotspot login.)
Why does this benefit AT&T? Every minute that you use over Skype over Wi-Fi is a minute that AT&T doesn't have to pay cellular transit costs for. Sure, AT&T makes money from selling you outside-plan minutes at about 25 to 50 cents a minute. But savvy user now buy unlimited plans or have pools large enough or use prepaid plans. I believe the fees from the overage charges are trending into place. Which means that AT&T would prefer you use less minutes, loading its network less.
Skype charges for calling to the public switched telephone network, a couple cents a minute to North America and many other countries or fixed monthly plans, but the margins are very thin there.
Let's say a billion minutes are siphoned from AT&T cell calls using the iPhone and now are made over Skype. Skype relies on peer-to-peer infrastructure for the most part (with some central authentication) for its Skype-to-Skype calling, so that's no skin off its nose. For AT&T, that's a billion minutes it doesn't have to carry with a commensurate drop in termination fees, carrying costs, and infrastructure buildout. Further, this encourage more use over Wi-Fi instead of over 3G, freeing 3G service by having people seek out Wi-Fi hotspots.
If you're like my wife and I, we already have the cheapest possible plan from AT&T: a family plan with two lines, the lowest number of minutes, and two iPhones (first generation). This still costs us $130 per month including taxes and we haven't been able to drop any lower with our current offering.
If we start calling a bunch over Skype for iPhone, then we're still paying that same $130 to AT&T, and yet we're using it less and less. It's all about margins. Skype still requires that someone else operate the network and the broadband, so even while Skype sucks minutes from the telecom infrastructure, it's hard to see how AT&T loses in this case because of the high fixed cost of obtaining a minimum cellular data plan.
iPod touch reaches out: The mobile Skype application works on the iPod touch, too, bringing such users access to a high-quality worldwide network of existing users and cheap calling. This device needs an external mike or headset (there's no microphone built in), but Apple revealed recently that 13 million iPod touch models have been sold. That's a big audience.
iPod touch owners don't have automatic free Wi-Fi hotspot access, but that's easy to solve. Hotspot operators and aggregators already offer mobile pricing. Boingo Wireless, for instance, has an $8 per month plan for mobile devices for which the iPod touch already qualifies. Get Boingo's iPhone/iPod touch application and you get automatic login, too.
Posted by Glenn Fleishman at 11:28 AM | Permanent Link | Categories: 2.5G and 3G, Cellular, Hot Spot, Voice | 1 Comment
A nifty little summary of the strain on 3G networks: Carriers want the additional revenue, but networks are performing inconsistently around the country, as capacity in some markets hits the limits, Matt Richtel reports in the New York Times. Just putting in more cell base stations doesn't help, as it increase interference. Chips have to be smarter, carriers have to tune their networks, and, apparently, users just have to put up with it.
Not mentioned in the article, which focuses largely on AT&T's network, is that AT&T pushes Wi-Fi to its iPhone customers, which in turn provides a more predictable experience in urban areas indoors, while offloading traffic from the 3G network and reducing interference among active devices.
AT&T has foolishly opted to require iPhone users to request access at an AT&T hotspot through a cumbersome process. Instead, AT&T should push data from iPhones onto its Wi-Fi whenever possible, because the experience will certainly be comparable, and generally superior, given the backhaul AT&T has in its Wayport-acquired locations.
Posted by Glenn Fleishman at 9:34 PM | Permanent Link | Categories: 2.5G and 3G | 3 Comments