U.S. launches next-gen wireless; where’s Canada?

MetroPCS Communications Inc. has become the first North American carrier to offer 4G wireless service using the ultra fast LTE technology.

How soon will a Canadian operator follow?

Initially, MetroPCS said Tuesday, service is available only in Las Vegas, but will be extended to more cities.

The Dallas-based carrier has been in a race with Verizon Wireless to be the first U.S. carrier to offer the next generation service for a big reason: Efficiency. Canadian carriers are interested for the same reason, but officially profess that they’re in no rush.

LTE has the potential to easily outstrip the speed and capacity of HSPA+ data networks used Canadian carriers, which currently offer maximum download speeds – under ideal conditions – of 21 Mbps. While HSPA+ can be boosted to 84 Mpbs or more, typically users will see average downloads speeds of only one-third the potential maximum. But LTE users will see closer to promised speeds of up to 100 Mpbs.

LTE does it in part by running on efficient 700 MHz spectrum, although it can run on higher frequencies. However, carriers lean towards using lower frequencies where they can get better area coverage. LTE is also based on Internet protocol, which makes spectrum go further. The current version of LTE, though, only has the data side IP-enabled. In an upcoming version called LTE Advanced, the voice side will be IP as well, offering great efficiencies for carriers.

Iain Grant, managing director of theSeaBoard Group, a telecommunications consultancy, notes Canadian wireless carriers aren’t in a hurry to upgrade to LTE because their new HSPA networks are less than a year old. “There’s no frequency congestion here,” he said.

Meanwhile, Industry Canada has yet to auction off 700 MHz spectrum here, some of which will come from conventional TV broadcasters when they switch next August to digital transmission. One problem is the Canadian Broadcasting Corp. (CBC) has said it won’t meet the deadline to surrender spectrum in some areas.

In fact Industry Canada has yet to set the 700 MHz auction rules, although recently Industry minister Tony Clement was quoted in news reports as saying he’d like to get on with the process. There will be quite a battle over the rules, with incumbent wireless carriers such as BCE Inc.’s Bell Canada calling for an open auction and startups like Wind Mobile arguing that without special rules for smaller carriers the incumbents will buy all the spectrum.

Set aside rules in the 2008 auction allowed Wind, Mobilicity, Shaw Communications Inc, and others to get into wireless.
Industry Canada also has to set rules for using LTE on the 2.6 GHz spectrum, now used by Bell and Rogers Communications Inc. on their joint effort called Inukshuk, which brings fixed wireless to remote areas.

In the U.S., where wireless users are eating up all the data they can use, carriers are eager to upgrade their networks to LTE – or build new ones – despite having few LTE handsets. MetroPCS, which jumped from a 2G CDMA/EVDO network with a maximum data speed of 3.5 Mpbs to LTE, has only one handset to offer customers: Samsung’s Craft, which has a 3.3-inch touch screen and a slide out keyboard. It can also link to WiFi.

Meanwhile, U.S. telco AT&T and wireless carrier T-Mobile are testing LTE and will both launch commercial service next year. In addition, Clearwire Corp., which provides the WiMAX wireless network to Sprint Nextel Corp., is looking at LTE in case it needs to switch technologies

On this side of the border, carriers say equipment manufacturers aren’t providing enough handsets for the North American LTE frequencies to justify a move yet. That’s one reason why AT&T is moving slower than other carriers. It’s expected that most U.S. LTE subscribers will be buying USB modems for their laptops until there’s a wider array of handsets.

In the meantime, Canadian carriers figure with the country’s smaller population, and the cost of upgrading to LTE, they’d rather ratchet up HSPA’s speed until they need to go to LTE.

So, for example, recently Telus Corp. said it will boost its HSPA+ wireless network from 21 Mbps to 42 Mpbs early next year. Other HSPA carriers will likely match it.

The wild card is Calgary-based Shaw Communications Inc., which says it will launch a new wireless network in Western Canada late next year. There’s speculation that Shaw is prepared to start with an LTE service and surprise competitors because the number of LTE-enabled devices available by then will make it worth it.

Known for its no-contract unlimited plans, which have been mimicked by Canadian startups Wind Mobile, Mobilicity and Public Mobile, MetroPCS is offering US$55 and US$60 per month LTE plans including taxes and regulatory fees for voice, text and data. Initially, the operator said, data service will be unlimited. It didn’t say how long that will last.

The Samsung Craft costs US$299 after a $US50 rebate.

As a lure, the US$60 plan comes with a new source of multimedia content including video content from NBC Universal, Black Entertainment Television (BET) and Univision.

MetroPCS is a relatively small U.S. carrier, as its roughly 8 million subscribers are dwarfed by both Verizon and AT&T, which each boast in excess of 90 million subscribers nationwide.

 (With file from Brad Reed, Network World U.S.)

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