re: Mobile Comm's on EDGE
New thoughts from Northstream.
Jane Zweig says: "If EDGE doesn't happen in Europe then where are the economies of scale for the US market? It is not large enough."
Not so, says Bengt Nordstrom, CEO of Northstream, who believes the three major US operators - boasting about 45 million subs between them - provide the "necessary backing". He expects Latin American TDMA operators to follow suit.
Harry Kuosa, EDGE marketing manager for Nokia Networks, claims that his firm already has European EDGE contracts in the form of bundled GSM/GPRS/EDGE agreements. The reason these have not been made public is that "they [the operators] don't want to distract from the WCDMA arrival... They are kind of hiding the real thing.
Jim Grams, a senior VP for Technological Development at AT&T, notes that, "EDGE has lost out in terms of PR value because it is more attractive for operators to talk about UMTS." However, he says that at the UMTS Congress in Barcelona "it was noticeable that carriers had suddenly slipped an EDGE upgrade into their network plans once they had heard a few things about UMTS."
>> Back From The Brink
James Tulloch
Mobile Communications International
01 November 2001
Until recently EDGE was a technology on the verge of oblivion. But US operators may have hauled it back from no man's land
"3G technology seeks backers"; the predicament in which EDGE found itself earlier this year. In March, a white paper from Swedish consultancy Northstream concluded that "EDGE may... never even reach the market."
AT&T apart, no major operator had announced plans to migrate to 3G via EDGE and the GSM community was fixated on WCDMA. However, the lack of available spectrum for WCDMA in the US did provide a glimmer of hope. "For operators without IMT-2000 spectrum, EDGE is an attractive path...If most American operators commit to EDGE, products will most probably be made available."
The first part of that equation has now happened. AT&T Wireless has been joined by VoiceStream, Cingular and Salmon PCS in its commitment to EDGE.
AT&T has completed the first live EDGE data call using a Nokia prototype handset. Cingular has undertaken to spend $3 billion on its network conversion to GSM/GPRS/EDGE with Ericsson, Nokia, and Siemens the primary suppliers of equipment. And Ericsson and Nortel have landed similar $150-$300 million EDGE infrastructure contracts with VoiceStream.
But sceptics believe the second part of the equation is far more problematic, partly due to this nascent EDGE community's isolation from the rest of the GSM world. Handsets are the rock upon which EDGE will founder according to Jane Zweig, CEO of consultancy the Shosteck Group. She argues that EDGE will not be deployed in Europe because operators already have WCDMA spectrum. If so, vendors will have no compelling reason to develop and rapidly produce a wide range of terminals. "If EDGE doesn't happen in Europe then where are the economies of scale for the US market? It is not large enough."
Not so, says Bengt Nordstrom, CEO of Northstream, who believes the three major US operators - boasting about 45 million subs between them - provide the "necessary backing". He expects Latin American TDMA operators to follow suit. But his certainty may be premature. Venezuelan TDMA operator Movilnet has just inked a $150 million TDMA-CDMA migration contract with Lucent and major regional players such as Telefonica Moviles and BellSouth have yet to make up their minds.
US operators, committed to GSM but short of spectrum, appear to have no choice. However, the spectrum argument may be a convenient fig leaf for operators unconvinced by WCDMA. Consider the damning comments of Kim Frimer, CEO of TDC Switzerland. "The UMTS standard used in the networks is not stable, the quality of the handsets is not satisfactory and the capacity in the batteries is too low." On that evidence who could blame Cingular CEO Stephen Carter for ruling out a move to WCDMA in the next three to five years? One of the big three US telcos even entertains plans to sidestep 3G completely, according to one US source. Put an 'H' in front of EDGE and you get the idea. Once the spectrum cap is raised from 45MHz to 55MHz in 2003, and Nextwave's spectrum becomes available, it will be fascinating to see whether lack of spectrum really is the main reason for postponing WCDMA and going with EDGE.
And EDGE in the US may not be quite as isolated as it first appears.
Harry Kuosa, EDGE marketing manager for Nokia Networks, claims that his firm already has European EDGE contracts in the form of bundled GSM/GPRS/EDGE agreements. The reason these have not been made public is that "they [the operators] don't want to distract from the WCDMA arrival... They are kind of hiding the real thing." Concentrating resources on EDGE could conceivably be seen as a tacit admission that WCDMA is a dubious prospect, with all the attendant implications for the share prices of operators which have sunk billions into UMTS. Jim Grams, a senior VP for Technological Development at AT&T, notes that, "EDGE has lost out in terms of PR value because it is more attractive for operators to talk about UMTS." However, he says that at the UMTS Congress in Barcelona "it was noticeable that carriers had suddenly slipped an EDGE upgrade into their network plans once they had heard a few things about UMTS."
The tentative roll-out plans of most European WCDMA licensees means there is space for EDGE as a short to medium-term complement to WCDMA. Yves Goblet, deputy CEO at Bouygues Telecom, says: "We could imagine a complementary roll-out of EDGE and UMTS technologies. I know some big operators are investigating the role of EDGE in areas where UMTS would not be implemented, where there is low traffic." This parallel service is what Nokia and Ericsson envisage and, as Nordstrom points out, the US operators can lead the way in driving technological and market development of EDGE. However, it will be hard pushed to compete with CDMA1X, due to be deployed by Verizon and Sprint PCS next year and already boasting a successful track record in Korea and around 30 available devices. It will probably suffer from the comparison. <<
- Eric - |
