For some time now, the nation’s two largest mobile phone carriers have competed almost exclusively with each other, marginalizing their smaller competitors. Verizon Wireless (VZW) has touted the reliability and extensiveness of its wireless network, while AT&T has focused on its network coverage and the superiority of its wireless technology. Now, as mobile phone operators prepare to deploy the next generation of wireless technology, the competitive pressures these companies face are changing dramatically.
Currently, AT&T and VZW use wireless technologies that are incompatible in every sense. As a result, the carriers have, for many years, competed on the strengths of their respective technologies. VZW, which employs Qualcomm’s CDMA, has focused on the dominance of this technology in the American wireless spectrum, dominance that allows the company to claim greater network coverage than its nearest competitor. CDMA, its proponents are quick to point out, also has better reception indoors due to its method of communicating with cell towers, and, in the case of Verizon’s network, its data speeds are higher because the carrier has widely deployed a third-generation (3G) CDMA technology. AT&T, on the other hand, has focused its marketing attention on the worldwide compatibility of its GSM network, which allows an AT&T customer to travel abroad without changing phones. Whether home or traveling abroad, however, AT&T customers will find that their data connections are often very slow for two reasons. First, AT&T’s data network is largely operating on a 2G technology, with 3G coverage limited to major cities (see my post on this topic). Second, US-based GSM carriers operate on different radio frequencies than their counterparts in other countries, preventing AT&T users (with very limited exceptions) from connecting to 3G data networks when traveling outside the United States. As mobile carriers worldwide begin deploying the next generation of wireless technology, however, many of the differences I’ve noted will be eliminated.
Even as mobile carriers continue to expand their 3G networks, many are looking to the fourth generation (4G) of mobile phone technology. Known as LTE, for Long-term Evolution, this descendant of GSM will be employed by all four major wireless carriers in the United States, as well as most carriers worldwide. In fact, Sprint has already begun deploying its 4G network, giving it the distinction of being the only national carrier with an active LTE network. Sprint’s move, and Verizon Wireless’ decision to implement an LTE network beginning in 2010, means that eventually, all four national wireless carriers will operate on the same technology (T-Mobile currently uses GSM, while Sprint uses TDMA, a cousin to CDMA). Where one carrier, T-Mobile for example, does not have coverage, VZW, AT&T, or Sprint likely will. This means that, assuming the carriers work out roaming arrangements that allow their customers to utilize a competitor’s network where the customer’s carrier does not have coverage, wireless providers will no longer compete based on the strength of their networks. Instead, phones, features, and pricing will be the focus of their marketing. These changes are some way off, though, as upgrading a nationwide mobile phone network in a country covering 3.72 million square miles of the Earth’s surface is no simple task.
See also: “How Smartphones Work: Network Protocols,” http://communication.howstuffworks.com/smartphone3.htm.