Editor’s Note: Welcome to our weekly feature, Analyst Angle. We’ve collected a group of the industry’s leading analysts to give their outlook on the hot topics in the wireless industry.
I’ve been having fun this week playing – and working – with my new AT&T 4G LTE Samsung Galaxy S II Skyrocket smartphone. The biggest problem I have had with the device is getting a turn with it – if I am not careful, the quick hands of my 4-year-old will snap it up to watch YouTube videos, my 7-year-old will be taking photos with it, or I turn around and find my husband has grabbed it for a quick Facebook fix. In our ever-more connected society, the 4G smartphone is addictive. The image and sound quality on the Samsung make even this form factor attractive for music video consumption, and the perceived quality of experience for progressive downloads of video delivered by the AT&T Mobility network when out and about rivals my home Wi-Fi, which links into a Verizon Fios fiber connection.
Having tried out the 4G LTE networks of both AT&T Mobility and Verizon Wireless in the Boston area, I have been impressed with the coverage and speeds on both networks. Coverage along highways is particularly good, and adequate in many areas around town and in the suburbs. I am particularly impressed with the signal level I have on my AT&T 4G LTE smartphone in-building at the Strategy Analytics office, which is not a great RF environment.
As for speeds, LTE delivers. Even when in lower signal areas I am achieving 2 to 4 megabits per second upload speed, and consistently over 5 Mbps download – often more –with top download speeds registering in the 20 to 30 Mbps range.
Granted, LTE networks are not yet fully loaded. On the smartphone there have been a few places where it fails to connect into Facebook or other applications – like inside a department store or on a section of Route 9 heading to Framingham, Mass., – typical of any wireless network in the United States where 100% geographical coverage is not feasible. But both of the rival top two wireless carriers have done a fairly remarkable job of delivering solid coverage at launch of their competing LTE networks.
My experience this week with my new LTE toy (and workhorse, which is what a smartphone is for many of us these days) brings me to several conclusions:
–Wow, am I lucky to live in an area of the United States where I have multiple choices not only for fixed broadband but also for mobile broadband on 4G (note: I also have coverage at home with WiMAX from Clearwire/resold by Sprint Nextel). An added bonus is that the 4G LTE services are on the 700 MHz spectrum bands that can achieve good geographic and indoor coverage (particularly as compared to the 2600 MHz bands being used for LTE in other markets). With initiatives such as Verizon Wireless’ “LTE in Rural America” and upcoming LTE deployments by smaller carriers like Cricket Communications, U.S. Cellular and Carolina West Wireless, to name a few, even more Americans will be able to experience mobile broadband on LTE in the areas where they live, work and play.
–I can’t wait for “built for LTE.” Mobility and broadband become the starting points, not the afterthoughts. And mobile broadband becomes pervasive in our lives. If users from multiple generations find themselves grabbing for the device today for many different uses, just imagine how my children will be using mobile broadband service when they hit their teens and we have had over five years of innovation and creativity building apps and devices specifically targeting 4G LTE (and by then, LTE-Advanced and beyond). In visits to Ericsson LTE demonstrations in Texas and the Verizon Wireless LTE Innovation Center in Waltham, Mass., I saw firsthand the early round of machine-to-machine and business-to-buisness-to-consumer devices and solutions that will become part of home and work for many families and vertical industries. And at the recent LTE North America 2011 conference, Jack Weixel of Google noted that now at Google the mobile use case is always first.
–User experience is by far the top buzz word and mantra for the mobile industry, both for engineers and marketers, and across the ecosystem for device vendors, content owners, network infrastructure vendors, retail channels and of course carriers. Technology for its own sake does not create markets. Products and services that do not delivery quality user experience will not thrive or even survive. “Users are the bottom line,” to quote Google’s Weixel.
In my life as a mobile analyst focusing on the global mobile broadband ecosystem, I have spent a lot of time in recent months analyzing how LTE is brought to market, which pricing plans and strategies resonate well in the market and drive uptake and aid in managing and monetizing data traffic.
The video opportunity – and challenge: I’ve also spent significant hours in briefings and discussions with solutions vendors that are addressing the need to optimize mobile video traffic as part of the research for a soon-to-be-released Strategy Analytics report on mobile video optimization. Even with the increased capacity of LTE, video optimization is and will be essential to deliver quality user experience and manage network congestion to reduce costs and minimize churn. In fact, I would argue that LTE is a driver for the need for mobile video optimization solutions as LTE makes the mobile video experience much more compelling and will stimulate more use of video: video downloads, video streaming, video ads inserted in applications, video chat and video telephony as “the new voice.”
With their powerful LTE networks carriers should be working to enable cost-effective (and money generating) delivery of video so they can move beyond today’s approach of stifling usage through fair use clauses and pricing plans that simply cap usage or throttle speeds. And they definitely need to work on more value-oriented data plans to hit mass market, as not everyone will want to spend a required $30 for data on top of a required voice plan, and 250 megabytes of data per month will not go too far with multimedia use, even with unlimited Wi-Fi included. Add in a 4G tablet with its own required data plan, and the costs ramp up quickly. Better value 1 to 3 gigabyte plans and plans to share data between a tablet and smartphone should be attractive and drive upgrades to LTE. Low price LTE handsets, which MetroPCS is pushing for to reach their demographic segments, will also be a must to drive LTE uptake to the next level.
Of course these things take time, business models need to be worked out, solutions tested and implemented. Most importantly, consumers need to be educated on new pricing styles that are not measured just in amount of data transferred but whether that data is transferred off-peak, who (and what apps) have priority during congestion, and what content may be bundled in with access. Pricing needs to be attractive to users, but users need to understand they have to pay for what they use. It is worth noting that many of the challenges for LTE today are not technology hurdles but business decisions and coordination/cooperation across the ecosystem.
Bottom line: Users and user experience will dictate winners and losers. Mobile broadband has hit home, but is still in its infancy. My experience hints that the future will be even more compelling, connected and innovative. I can’t wait to experience (and analyze) it.
Susan Welsh de Grimaldo joined Strategy Analytics in 2008, bringing over a decade of experience developing strategy and analyzing trends in the global wireless and broadband industries. Welsh de Grimaldo thrives on discussing both the business and technical angles of mobile broadband and regularly speaks at conferences and client events. Her recommendations are invaluable to clients across the mobile value chain as they tackle critical issues such as 3G/4G plans and pricing evolution, cost savings and revenue growth opportunities, backhaul, and voice/data business models for traditional and emerging devices.
Prior to joining Strategy Analytics, Welsh de Grimaldo was a Strategic Business Manager at General Dynamics Wireless Services, where she conducted strategic planning and market analysis for commercial and public safety wireless network and international IT services. She held various positions including Director of Wireless Consulting at The Strategis Group, where she led projects involving market sizing and forecasting, market entry strategies, competitive assessment, business and strategic planning, and due diligence. Her experience includes analysis and forecasting of wireless data, next generation wireless services and devices, wireless infrastructure and components, and fixed broadband wireless.
Welsh de Grimaldo holds an MA from The Monterey Institute of International Studies.
