Subject: [NEXTEL-1] Sprint Holding Back On EV-DO Offering

From: [email-masked]
Date: Thu, 02 Oct 2003 12:26:05 -0400

Sprint Holding Back On EV-DO Offering
 Contributed by mmasnick on Wed, Oct 1 2003

 The Washington Post has yet another writeup about Verizon's new EV-DO launch in
DC and San Diego (which
 we wrote about on Monday - wondering if it was the second coming of Metricom's
Ricochet). Alan Reiter,
 though, picked up on a few important points made in the Washington Post piece
that most other articles on the
 topic didn't touch. The Post gets Sprint PCS to say that they're not that
interested in EV-DO right now, and
 wouldn't look to do an upgrade for at least a couple of years. Instead, they're
focused on WiFi (as can be seen
 from their recent announcements). Reiter points out that this means Verizon is
going to have the cellular
 broadband market to themselves for a while. The GSM players are slowly moving to
EDGE which will still be
 noticeably slower than EV-DO. If we ignore the smaller players like Monet and
assume that Verizon Wireless
 can continue to rollout EV-DO fairly rapidly in major metropolitan areas, it's a
good point. The issue, then, is
 whether or not this is a smart play by Sprint PCS. WiFi has certainly gotten much
of the hype, but if it starts
 losing users to a wide-area solution like EV-DO, they're going to have to rush to
catch up. At the very least, it
 would make sense to do some hedging by running some tests and getting familiar
with the technology in
 real-world environments. I'm still a bit skeptical of how well Verizon's EV-DO
offering will work. Reiter's early
 tests suggest download speeds that are slower than even the lowered "expected"
speeds Verizon announced,
 along with pitiful download speeds - and that's before many people are even using
the system. Overall, it looks
 like the other carriers have decided that it's too early for this market, and
they might as well let Verizon
 Wireless test the field and take all the first arrows.
=

==================================================================================

Speeding Up the Wireless Internet
Verizon Launches Service in Closely Watched Test

By Yuki Noguchi
Washington Post Staff Writer
Wednesday, October 1, 2003; Page E01

Verizon Wireless today launched a super-fast version of wireless Internet access
in two cities -- Washington and San Diego -- in a closely watched test of whether
people crave mobile Internet access enough to pay $80 a month for it.
The service allows laptop users to reach the Internet at speeds rivaling those
offered by cable modems and digital subscriber lines. It is the latest gambit in
the expensive race by mobile phone companies to entice people to pay more to do
all sorts of things besides talk on cellular networks.

While most carriers in the United States already offer mobile Internet access,
those services are so slow and clunky they have not caught on with consumers.
Verizon said its new BroadbandAccess network offers data transfers three to four
times faster than existing mobile data services, which generally peak at roughly
the speed of a dial-up Internet connection.
If the service succeeds in its pilot regions, Verizon said it will begin upgrading
its cell towers around the country next year.
Analysts estimated it will cost Verizon Wireless more than $1 billion to install
the required software and hardware in the base of
all its cellular towers nationwide -- and that's on top of the $1 billion the
company spent for previous network upgrades a year and a half ago.

Verizon Wireless is a joint venture between Verizon Communications Inc. and
Britain's Vodafone Group.
Both AT&T Wireless and Cingular Wireless also are upgrading their networks, using
a different technology to achieve high speeds. AT&T plans to complete its
improvements by the end of this year, while Cingular hopes to finish by June 2004.
The two are spending about $3 billion apiece to upgrade their networks to send
data faster, said Eddie Hold, an analyst with market research firm Current
Analysis Inc.

Sprint PCS is taking a slower approach, with no plans for a major network overhaul
until 2005 or 2006.
"The key question is: Can you add enough customers to pay back that investment?"
said Oliver Valente, vice president of technical development at Sprint PCS.

Instead of paying for a new network, Sprint is taking a "fiscally prudent"
approach, Valente said, by reselling an even faster
wireless service from Wayport Inc. using a rival technology called Wi-Fi, short
for "wireless fidelity." The advantage of Wi-Fi is
extremely high speed, but its Internet connections have a shorter range, reaching
only several hundred feet from their transmitters.

Verizon's BroadbandAccess service costs $80 a month, the same as its previous
wireless service at slower speeds. Initially, it will be available inside the
Beltway, along with the city of Alexandria and portions of Montgomery, Prince
George's, Fairfax, Loudoun and Prince William counties. The service will expand to
Annapolis and the Baltimore-Washington International Airport by the end of 2003.

The service is aimed primarily at business users who need access to the Internet
away from the office. Customers must buy a $250 card to slide into their laptops
or handheld computers, and Verizon is offering a $100 rebate on those cards until
the end of the year. BroadbandAccess users will be able to surf Verizon's
high-speed network where it exists; where it doesn't, the connection will kick
back to Verizon's conventional data network at dial-up speeds. For now, the
service won't be available over conventional cell phones.

So far, most Americans have not embraced wireless data. Only 10 percent of all
U.S. cell-phone users -- 15 million people -- use wireless data services, mostly
for basic services like sending short text messages or transmitting photos.
Wireless data generates 3 percent or less of the carriers' revenue and has yet to
generate profits, analysts say.
Verizon recognizes the risks and is wisely testing the waters by deploying its
network first in two markets, said Ken Hyers, a senior analyst with Instat/MDR, an
industry research firm. "Are there going to be enough customers who are willing to
pay a premium to justify building this across the country? That is the question
Verizon is trying to get answered right now."
Verizon said a few federal agencies and hundreds of large businesses tested the
service over the past five months. A high percentage of them plan to pay to
continue the service, said Bill Stone, vice president of marketing for Verizon
Wireless. He noted the technology behind BroadbandAccess, 1xEvDO, is widely used
in other parts of the world, including South Korea and Taiwan.

To succeed, Verizon needs to win potential customers like Chris White, a
University of Maryland student who went to a Verizon store this week for a new
cell phone. White said he welcomes a speedier wireless Web -- but only at the
right price.
"As a small-business man, I'd figure out a cheaper way to do it," he said.

http://www.mobitopia.com/20031001.html#174622

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