By Andy Patrizio
The fourth generation (4G) of wireless communications is making its way into the marketplace as quickly as America's major carriers can afford to roll it out, although this is another one of those scenarios where it won't pay to be an early adopter.
4G technology is entirely built around accelerating data communications. The voice element of wireless is fairly mature and there isn't much more the carriers need to do on that side.
While the move to 4G will have challenges for the carriers, these are different from the buying public's problems. There are enough issues for consumers to be aware of that it wouldn't be a bad move to wait. The carriers, on the other hand, are well aware they can't wait, and have moved ahead installing 4G networks.
Moving to 4G means new spectrum and new back-end gear (including new antennas and software), but it's going as expected, reports Chris Guttman-McCabe, vice president of regulatory affairs for CTIA-The Wireless Association.
"I think in the U.S., the rollout is going extremely well. We had argued that as more spectrum came to market, carriers would work with infrastructure vendors to upgrade their networks, which puts pressure on handset makers to upgrade their handsets, all of which is happening," he said.
3G vs. 4G
The promise of 4G is high data speed, but whether it lives up to that promise is another question. On paper, 4G is supposed to have peak download rates of up to 299.6 Mbit/sec and upload rates of up to 75.4 Mbit/sec. Those who have bought first generation phones report a lot less than that. Initial tests put 4G at around 10-20 Mbit/sec downloads, but that's still way better than 3G networks, which average 600 Kbps to 1.4Mbps. It means you have the equivalent of a cable modem wherever you go.
Reaching the full potential of 4G will be neither cheap nor easy, and it won't be done quickly. At best, providers like Verizon Wireless, AT&T Wireless, T-Mobile USA and Sprint Nextel have to add new 4G equipment alongside their existing 3G gear. That's because LTE uses a new, separate spectrum from 3G networks.
So 3G and 4G will have to exist side-by-side for the foreseeable future, which means two separate sets of equipment for the telcom provider. That translates to rollouts being fairly slow, and most rollouts are in smaller, secondary cities instead of the largest ones first. If there is a problem, better to have it in St. Louis or Louisville or San Antonio instead of New York, L.A., or Chicago.
4G phones are in their first generation, and they have a little problem: they kill the battery. "First-generation chips are power hungry," said Jack Gold, president of J.Gold Associates, who follows the wireless industry. "Everyone is beating up on RIM for not having an LTE phone, but it's a smart move because they will have an integrated solution that won't drain your battery in 22 minutes."
The integrated solution will be a next-generation 4G chip that combines 3G protocols as well. First-generation 4G phones need two baseband chips; one for 3G and one for 4G.
This has multiple drawbacks: it increases the phone's cost, it increases the phone thickness because one more chip has to be shoehorned into these increasingly thin form factors, and it definitely impacts battery life. People have complained of 4G phones running out after just a few hours.
This is what Apple CEO Tim Cook meant when, on the April 2011 earnings call, he said first generation 4G chipsets "forced a lot of design compromises that the company was unwilling to make," and that's why the iPhone 4S is not 4G.
The second generation of 4G chipsets will be integrated, so one chip will cover both 3G and 4G. "That's when 4G gets attractive. That's one of the keys to making it more power efficient," said Gold.
Guttman-McCabe disputes the complaints about battery life. "From personal experience I've noticed no difference from the device I have [a Motorola Droid Razr] in terms of battery life. That doesn't mean it doesn't exist, but you see evolution in every element of this service. I am sure that our manufacturers are constantly striving to improve battery life. I think you'll see efforts to continue to improve," he said.
More Speed, More Services?
Carriers are always trying to generate more revenue from services, from mobile management to app stores to virtualized space for end users, although they haven't been very good at that in the past. But with faster 4G service comes the real risk of sucking up your monthly data plan limit in a few hours. Don't hold your breath on those caps going up, argues Gold.
"There is no incentive to raise data caps. If you start encouraging people to use it, they will. That's what happened with the iPhone when it first came out. We won't see unlimited data again. It's not sustainable," he said.
But Guttman-McCabe thinks the plans will evolve. "Service has gone from voice only to nights and weekends to calling circles and family plans and on and on. I just think those will evolve to match the needs of customers. If you look at how plans have evolved, the average bill continues to go down, and what you are getting for it has exploded. That's what an aggressively competitive market brings you. It brings you services and price," he said.
One thing Gold predicts for the future is new plans to cover multiple devices. "Most users will have more than one wireless device and they are getting tired of getting a data plan for every device. So shared data plans are something you can expect. I don't think [the wireless providers] can push that off much longer with so many people buying multiple devices," he said.
Guttman-McCabe expects new services that take advantage of the high speed networks, but admits he's not sure what they will be. "I see a lot of changes in the next two years in terms of different types of services being offered and products you can buy and uses for the networks," he said.
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