US: Network operators and cellular standards

AT&T uses the GSM cellular standard, over which the vast majority of mobile phones operate worldwide. T-Mobile USA uses GSM as well. Verizon Wireless and Sprint Nextel opted long ago for CDMA, which is used by hundreds of millions of people in the United States and elsewhere, but has no future as a standard.

The iPhone simply can’t operate on Verizon’s network today. There is no technical reason why Apple cannot create a modified version of the iPhone that works on Verizon’s current 2G and 3G networks. Except that Apple’s mobile chip provider is Infineon – still, by all reports – which has no CDMA technology in its portfolio, only GSM.

That means Apple would have to switch or supplement chip providers, which would be difficult given Apple’s penchant for secrecy, and how closely the company reportedly has worked with Infineon. Infineon could develop its own CDMA chips, but Qualcomm owns an enormous number of patents related to CDMA (which it invented), and it would be a complex, long-term, but doable project for Infineon to obtain the rights. That all makes it unlikely in the short run.

Infineon also has one software-defined product, where software can reshape the radio standards supported in the chip, but CDMA isn’t on the list of supported standards.

Further, it’s hard to see why Apple would start down the CDMA path at all at this moment, because Verizon Wireless and Sprint Nextel have both abandoned the CDMA roadmap, and Qualcomm has discontinued development on its 4G standard. Verizon and Sprint use EVDO, Qualcomm’s 3G standard, but have each committed to different fourth-generation network standards. (EVDO doesn’t allow data and voice at the same time, which would seemingly be a non-starter for Apple philosophically.)

AT&T, T-Mobile, and Verizon will all use LTE (Long Term Evolution), which is considered a GSM-evolved protocol – the standard has come out of the GSM worldwide trade group – and has emerged to be the dominant next-generation mobile standard. LTE will have a top rate of 50 to 100 Mbps, with a real per-user speed that could hit 4 to 8 Mbps in routine use, and much higher burst rates.

Sprint has opted for WiMax, because the firm wanted to get a 4G network deployed faster for competitive reasons, and wasn’t sold on LTE when it made the call. Sprint merged its holdings with Clearwire, which it now owns a majority of, and has put WiMax in four major cities so far (Atlanta, Baltimore, Las Vegas, and Portland, Oregon). Sprint’s choice of WiMax makes it unlikely to work as an Apple partner, and Sprint was the exclusive debut carrier for the Palm Pre, as well.

Companies working on LTE phones and telecom analysts don’t expect handsets with LTE built in for a while – 2011 will likely be the earliest, but it could even be 2012. Clearwire expects to have WiMax built out to pass 120 million people by the end of 2010, but Verizon and AT&T likely won’t hit that population until well into 2011 with currently announced plans.

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