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Taking bets on alternative wireless

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On the one hand, Apple is having great success selling the iPhone running on AT&T’s Edge network (and according to rumors just ordered 10 million next-generation 3G phones to run on AT&T as well). Meanwhile, Verizon gets plaudits for “opening up” its CDMA network to more devices and apps.

On the other hand, it seems like everybody and their brother (and not just network competitors) -- from Google to Intel to Microsoft and others -- are desperate to find some kind, any kind of alternative to traditional wireless service provider networks.

In next Monday’s print issue of Telephony, and online the same day, wireless editor Kevin Fitchard and I take an in-depth look at the momentum behind alternative wireless service provider models. Check that out next week.

But even as we closed up that story, the news on this front keeps on rolling in.

First, we had the close of the 700 MHz auction (which, quite tellingly, ended with Verizon and AT&T acquiring most of the available bandwidth). Just this week, Google became the latest Internet or PC industry player to jump on the white spaces broadband bandwagon, while today Comcast and Time Warner emerged to reportedly help get a nationwide WiMAX network off the ground, with Google reportedly chipping in some funding.

So what’s the deal?

It seems like there’s a couple of forces at play, and a couple of now-familiar outcomes that seem to be ruling the day:

  • A wide array of companies has some level of interest in shaking up the wireless status quo, especially here in the U.S. Mostly it involves companies extending an existing business -- apps, advertising, content, etc -- into the wireless world.
  • Gaming theory dictates (see Google’s 700 Mhz maneuvering) and corporate strategy principles further the idea that stirring up some trouble can at times be as effective (and certainly much cheaper) than making actual investments or starting new businesses -- in particular, infrastructure-based businesses like telecom.
  • That said, building and operating a first-class wireless network is much easier said than done. For all of Google’s 700 MHz and now white-space maneuvering, in the end it is leaving the network building to the pros. And as much as Sprint/Clearwire have touted a new nationwide WiMAX network, the promise of building said network has all too often run headfirst into the reality of significant technology and business challenges. Universally accessible Wi-Fi, meanwhile, remains a horse that never really left the gate.
  • There’s no doubt that things can change fast in the wireless industry -- for proof look no farther than today’s news on the rise and fall of Motorola and the Razr.

So on the eve of next week’s CTIA show -- and with NCAA bracket-betting fever in full swing -- let’s place some bets.

Will incumbent carrier-provided 3G/4G services be more widely available a year from now? I’d take that bet. Will market forces, including ongoing pressure to keep data prices low and usage caps unlimited, have a major influence over the rollout and direction of those networks? A likely winning bet as well.

Will an alternative wireless provider -- any type of wireless provider -- take a major chunk of the U.S. wireless data services market, not just next year but anytime soon?

I’d stay away from that bet, myself, but…. any takers?

Let us know.

E-mail me at rkarpinski@telephonyonline.com.

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