Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: foundation who wrote (30109)	12/16/2002 9:02:35 AM
From: foundation	Read Replies (1) \| Respond to of 197248

Trials Sprout, But What's EV-DO Business Case? BY BILL MENEZES DECEMBER 16, 2002 WIRELESS WEEK It seems that almost weekly a new U.S. trial is unveiled for CDMA2000 1X EV-DO broadband networks. But the seeming momentum of the technology itself appears to be running into the reality that the market for it has not yet materialized beyond a few niche applications–yet. A quick update from some of the ongoing trials indicates clearly that EV-DO for the time being in the U.S. market will be the province primarily of operators who have small, easily upgradeable networks and distinct, immediate competitive advantages from offering the 3G technology. The big boys are another story. One of the latest trial announcements comes from Alaska Communications Systems Group, a diversified telecom service provider based in Anchorage. ACS is working with Airvana, GTran Wireless and possibly Nortel Networks to create a trial network based on CDMA2000 1X EV-DO infrastructure beginning next year. The operator is looking at EV-DO as a possible technology for providing a broadband access platform, noting its sustained data rates in the 300 kbps to 600 kbps range, to complement its existing wireline voice and data services. ACS has about 330,000 total access lines and reported about 11,000 DSL customers at the end of the third quarter. The company also has about 80,000 cellular customers on its 800 MHz and 1900 MHz TDMA networks, which it is moving to upgrade to CDMA2000 1XRTT over the next several years. ACS chose CDMA as its 3G upgrade path partly because the high-speed data network element seemed further advanced than the GSM-based alternatives. The trial itself will explore not just whether the technical capabilities of EV-DO are as promised on fully loaded field networks, but also whether there's a business case for higher-bandwidth data services among ACS customers. Anna Sansom, ACS's senior manager of product marketing and development, notes that because of their state's rugged and expansive geography many of the carrier's customers use wireless as their primary phone line. Add to that increasing demand for Internet access–which some customers have to do at 9.6 kbps over the TDMA network because of a lack of wireline availability–and upgrading the wireless network makes sense. "Because of the geographical diversity in Alaska we see this as filling some of the gaps," Sansom says of high-speed wireless. But will 1XRTT provide what ACS needs or will there be a compelling reason to move further along to EV-DO? That will depend on technical factors–such as whether the network enables seamless handoffs–and whether sufficient demand emerges among fixed or mobile customers, or both. ACS's planning is an example of how the benefits of EV-DO may make the technology initially more prevalent in markets where current broadband access availability is limited, such as Anchorage, Duluth, Minn., site of Monet Networks' much-hyped EV-DO launch in early November, or Boise, Idaho, where Sprint PCS affiliate Ubiquitel has an enterprise-oriented trial under way. Carriers that just dropped a big chunk of capex on upgrades to CDMA2000 1XRTT may be even more reluctant than the smaller market operators to move quickly on EV-DO without a compelling financial reason to do so. Sprint, for example, has made it clear it will boost network efficiency and speed first by using data compression and may skip EV-DO entirely in favor of waiting a few years to explore the higher speed EV-DV technology. Verizon Wireless is another good case in point. So far, despite good results in its own limited EV-DO trials the carrier isn't looking to deploy the technology commercially any time soon. Bill Stone, executive director of network strategy for Verizon Wireless, oversees the EV-DO "performance testing" trial that the carrier began a few months back in San Diego and suburban Washington, D.C. Verizon got the chance to show off the San Diego network to a limited public audience during the CDMA Americas Congress earlier this month in San Diego, working with GTran, Airvana and Nortel to supply journalists and others with access to the network during the show. The Washington-area trial is using Lucent Technologies network infrastructure. At CDMA Americas, the system typically provided bandwidth in the 900 kbps or higher range–compared with the 400-600 kbps rates likely on a more fully loaded network–at many locations covered by eight sites in a coverage area extending from downtown to just a bit north, near the Qualcomm corporate campus. Stone says Verizon's seeing similar results in its Washington trial, where it has deployed the technology to 29 base stations covering northwestern suburbs from Tyson's Corner, Va., to Rockville, Md. It's also experiencing the spectrum efficiency gains expected from next-gen networks: "We're seeing on the order of four times the capacity gain" it is experiencing from its 1XRTT networks, Stone says. And now the company has begun some limited friendly trials, cycling 300-400 enterprise and consumer users on and off the network via devices such as laptop computer cards providing Internet access via virtual private networks or PDAs and phones with embedded EV-DO technology. So far, the feedback has been strong, Stone says. Many of the consumer testers are students who are downloading larger BREW applications, MP3 files and Internet radio feeds; "the overwhelming majority love it," he says. But so far the business case has not yet emerged for wider scale deployment, and trials will continue into 2003. A big reason: The relatively recent deployment of 1XRTT–Verizon's so-called Express Network–and the need to show 1XRTT adoption rates and revenue per subscriber that are significant enough to warrant the investment in widespread EV-DO upgrades. Stone says success in 1X will drive the company's plans for EV-DO; 1X enables wireless data at a lower cost per bit than the predecessor IS-95 network, so at a certain usage threshold it's even more efficient to move to EV-DO. Verizon Wireless also wants to be sure that if its data business is busy enough to warrant the network investment in EV-DO, the vendor community is ready to go with network elements and user devices once the carrier is ready to go. Stone says he expects that could occur as early as mid-2003. Until then, the little guys may remain out in front on EV-DO. wirelessweek.com