Verizon Launches LTE; Let the 4G Wars BeginVerizon Launches LTE; Let the 4G Wars Begin

The mobilistas will be jumping at 4G, and streaming video will probably be the first (but not the only) service enhancement they'll get.

Verizon Wireless will officially launch their 4G LTE network service on Sunday December 5 with service in 38 metro areas and more than 60 U.S. airports. Verizon plans to expand the service to their entire 3G footprint by 2013. The service promises to deliver download speeds of 5 to 12Mbps and upload speeds of 2 to 5Mbps, but it’s not cheap. Verizon will be charging $50 per month for up to 5 Gbytes of usage and $80 per month for up to 10 Gbytes--it's an additional $10 for every Gbyte over that. Interestingly, the 5 Gbyte plan on their existing (and considerably slower) 3G network is $59.99 per month, so I'm sure we can expect some "price rationalization" as time goes on.

All in all, the only real news was the pricing. Verizon had disclosed their timing and locations over the past several months, and they had been fairly forthright regarding their plans to use tiered pricing. So the announcement was largely a matter of filling in the numbers.

As most of us had expected, the initial service will be geared toward laptop access. They are offering an LG VL600 USB modem for $99 (after rebate) with a two-year contract; a second Pantech UML290 USB modem should be available "soon". Interestingly, there is no Mac support in the initial version.

The first LTE-capable smartphones are expected in mid-2011, but the big question surrounds the iPhone. The rumors of a Verizon iPhone have been around almost as long as the iPhone itself, so it will be interesting to see 1) if it does show up in 2011, and 2) if it's built for LTE or for Verizon’s existing 3G EVDO data service.

As you might imagine, the other mobile operators were quick to respond. Sprint's 4G service is provided over Clearwire's WiMAX network, was launched in September 2008, and now reaches 61 markets. The data rate is somewhat slower (3 to 6 Mbps downstream and .5 to 1.5 Mbps upstream), but the service is flat rate at $49.99 per month and unlimited. They also support two Android smartphones (the HTC EVO and the Samsung Epic) along with a gaggle of USB modems and 4G-equipped Wi-Fi routers--and they also support Macs.

Given the industry-wide move towards LTE, Sprint's equipment advantage will likely disappear quickly, and they have only been offering smartphones since late-June. With their aggressive roll-out plan, Verizon's coverage footprint will likely match Sprint’s in the not too distant future.

Probably the most interesting commentary came from AT&T’s Chief Technology officer, John Donovan, who blogged on the Verizon announcement. As AT&T doesn’t have a 4G offering (nor have they announced firm plans regarding one), Mr. Donovan's pitch centers on consistency, particularly the fact that their 3G HSPA+ service is more widely deployed than Verizon’s 4G LTE. When you move out of LTE coverage, Verizon's service will revert to EVDO, delivering a downstream rate in the 3 Mbps range. It's difficult to tell what AT&T's network will do but Mr. Donovan assures us its "largest competitor's wireless network is 60 percent slower on average nationally. The closest competitor is 20 percent slower."

In a great testimonial to mindless market research, the blog cites a study by Taylor Research and Consulting Group that says 75% of consumers answered in the positive to the question:

"Would you prefer: a wireless service with 4G data speeds that reverts to a much slower speed when you are out of the high-speed footprint, or a wireless service that offers much more graduated speed reductions when outside of the high-speed areas."

Ask a stupid question...

To net it all out, if you're looking for a high-speed wireless data service to connect your laptop when you are out and about, we've got you covered in most of the country with 3G (speeds at least 3 Mbps downstream). If you want the next notch up, 4G with speeds ranging from 3 to 12 Mbps, about one-third of the US population is covered. Most of the rest will have 4G coverage within the next few years.

It's going to take a little longer to enhance the smartphone experience with 4G, but there is no doubt that the smartphone manufacturers will be getting on the 4G bandwagon as quickly as they can, as they likely face absolute obliteration at the leading edge of the market. Note, that's at the "leading edge" of the market. Smartphones still represent less than 25% of US cellular handsets, so it's important not to lose sight of the big picture.

The mobilistas will be jumping at 4G, and streaming video will probably be the first (but not the only) service enhancement they'll get. There is a limit to what people will spend, and possibly the arrival of 4G will put downward pressure on 3G services, enticing more basic phone users to move up to a smartphone--a "3G smartphone".

The mobile market is exciting to watch as carriers and handset manufacturers continuously leapfrog one another in delivering mobile capabilities that were essentially unimaginable five years ago. Verizon’s LTE is not the last word in this, but it is certainly the next important step forward.