a week in wireless


Lassie come home

AWIW438

The last week has been tinged with sadness for the Informer, following the death of one of the great celebrity icons of recent times. A star from a young age, this was a life lived very much in the glare of the media spotlight, and yet a life lived with true grace. Rest in peace, Knut the polar bear—gone, but not forgotten.

Liz Taylor kicked the bucket as well. She was just as famous for her addictions—alcohol, painkillers and wedding presents—as she was for her film career, and the Informer wonders what she, having seen off eight marriages, would make of the proposed union between AT&T and T-Mobile USA. AT&T, the US market leader by a nose at the close of 2010, according to WCIS, has offered $39bn for Deutsche Telekom’s US arm. It’s an arm that’s been a source of discomfort since DT, which will gain an eight per cent stake in AT&T as a result, becoming the firm’s largest shareholder, bought VoiceStream ten years ago.

The deal will add around 34 million customers to AT&T’s existing base, taking it to somewhere in excess of 130m customers and a US market share of 43 per cent. With Verizon finishing 2010 with 31 per cent of the market, the deal would see around three quarters of the US cellular market in the hands of just two companies, so it’s not going to go through without a fight.

The US regulatory authorities are likely to have serious concerns about levels of competition in a post merger world, not to mention Sprint, which would find itself spinning in an unpleasant no-mans land between the big guys and the bit players. As if trying to figure out what the hell to do about Clearwire wasn’t enough for Sprint to be getting along with.

Back to those bit players, though. The NetAmerica Alliance, has announced a partnership with Ericsson that will see the rolling out of LTE networks in American rural markets. The Alliance is a standalone organisation that brings together small, independent LTE licence holders in rural America, in an effort to create a nationwide 4G partnership capable of banding together to wield similar economic influence to that held by larger carriers.

The partnership with Ericsson will see the building and deployment of a shared LTE network in smaller markets and rural areas. According to Ericsson’s Arun Bhikshesvaran, this is a new type of LTE deployment that makes it possible for “smaller operators to join together to deliver cost effectively the same mobile broadband services available in major metropolitan areas.”

There are currently 225 rural Advanced Wireless Services (AWS) or 700MHz spectrum licence holders in America; according to NetAmerica CEO Roger Hutton, three of these have already agreed to pilot trials beginning in April. A further 60 are in discussions. For the immediate future, the plans is to offer data services only—voice over LTE support is expected early in 2012. One step closer to carrier status for Ericsson.

Not unlike wholesale gambler Lightsquared, which has announced two of the customers to which it was making coy reference back in February. One of these is electronics retailer Best Buy, which plans to resell 4G connectivity under its own brand. Best Buy owns a share in the Carphone Warehouse operation in Europe, with the two firms co-owning a European consumer electronics retail business, and the firm is clearly looking to integrate mobile service into its mix.

The other customer is one-time Qualcomm baby Leap Wireless, which offers service under the Cricket brand. Lightsquared has undertaken not to sell beyond a certain amount of its capacity to US market leaders (until now AT&T and Verizon) and the AT&T/T-Mobile deal could well impact its potential market.

Sticking with the fourth generation, UK regulator Ofcom finally got around to formalising some its spectrum allocation process for 800MHz and 2.6GHz. While the spectrum will be auctioned on a technology-neutral basis, it’s hard to see it being used for anything other than LTE. The auction is scheduled to begin in the first quarter of 2012, and Ofcom will be imposing caps on spectrum acquisition in a bid to maintain the number of networks in the market.

The regulator said: “There would be significant risk to national wholesale competition if there were fewer than four national wholesale competitors with credible spectrum portfolios for providing higher quality data services.” But the Informer finds himself wondering how this can be maintained. Orange and T-Mobile are hardly going to bid as competitors, as Everything Everywhere would own it all anyway. With 3UK’s network now part of the MBNL JV with T-Mobile out of economic necessity, it’s impossible to see how it would be able to go it alone with a 4G deployment—so any spectrum won by 3 would probably end up in the same pot as that taken by Orange and T-Mo.

So is there an opportunity for a wholesale newcomer to enter the UK market à la Lightsquared? Not likely, given the size of the market (after all, there’s no guarantee it’s going to work in the US…). All current indications are that the UK has too many networks for the market to sustain anyway, otherwise why all the net share and consolidation? Still, Ofcom gets to pitch its pro competitive stance in the meantime.

Over in China it’s all about the TD flava, and the announcement that Alcatel Lucent is to partner with China Mobile on what is claimed to be the world’s largest 4G TD-LTE trial network, which will cover six major Chinese cities (they’re all major by everyone else’s metrics), including Shanghai and Beijing. China Mobile’s choice of partner is useful collateral in the ongoing battle over the perceived barriers being placed in the path of Chinese vendors looking to do business in the West.

A successful LTE trial has been concluded in Croatia, it was revealed this week, by Croation operator VIPnet. The trial began in October last year in Zagreb and the carrier has now pledged to dedicate a minimum of ten per cent of its total investment budget into LTE ahead of commercial launch in 2012.

In Brazil, too the 4G standard is gaining traction, with Oi having invited vendors to partner it for trials of the standard. This week Spanish incumbent Telefónica announced that it has earmarked almost $15bn for investment in Brazil. Telefónica secured ownership of Brazilian player Vivo last summer after a long tit-for-tat with Portugal Telecom and is now looking to exploit its position in the market.

Let’s have a look at some application store news now and web retailer Amazon has decided to get in on the act with its own store. The list of possible names for these things dwindled away a long time ago, So Amazon decided to pick one that was already out there, and delete a space in the hope that nobody would notice. So now we have an Appstore as well as an App Store. Unfortunately for Amazon, Apple’s beady eye never blinks and it promptly issued a law suit.

Anyway, the Appstore is geared towards Android devices, which offers a clear enough distinction from the App Store, if one was needed. And it seems you can’t launch an application store these days without making some kind of hoo-ha about having Angry Birds available (apparently there’s a film being made of Angry Birds. A film!). Amazon has said one premium app will be free each week in a bid to attract users and has also launched Test Drive, an online simulation that lets buyers see what Apps will look and feel like. The firm is banking on its discovery techniques to keep it relevant in what is an increasingly, and for the Informer’s money unsustainably, crowded space.

Sticking with apps, Research in Motion has announced this week that its new tablet, the Playbook, will be able to run Android apps some months after it launches in April. Presumably this means that there wasn’t enough developer enthusiasm to generate sufficient apps for the RIM platform. RIM will introduce two optional ‘app players’ that provide a run-time environment for Java and Android apps for the device. How long until the same functionality is available on BB handsets…? It can’t be far off.

Meanwhile, Google has delayed the release of the Honeycomb flavour of Android as fully open source.

Finally, and from the ‘sends a chill down the spine’ section of the news, there are rumours that Motorola has resumed work on the development of a bespoke smartphone operating system. You can’t fault their optimism.

Take care

The Informer


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