The largest US wireless carrier, AT&T (NYSE: T) is set for a marketing launch of its fourth generation network, LTE or Long Term Evolution. The five lucky cities are Atlanta, Chicago, Dallas, Houston, and San Antonio.
The Wall Street Journal reports that the network has been in place for “the last few months” and that Sunday’s launch marks the start of AT&T’s efforts to market the service. One big plus for the company is that it does not plan to sell a new data plan, choosing instead to offer the 4G LTE service as a bonus to existing subscribers. Wonder how long that will last?
Verizon Wireless, a joint venture between Verizon Communications Inc. (NYSE: VZ) and Vodafone plc (NASDAQ: VOD), rolled out its 4G network late last year with an unlimited data plan costing $29.95/month. Last month Verizon replaced that with a metered that plan that charges new customers by the amount of data they use.
Both Verizon and AT&T promise download speeds of 5-12 megabits/second. Upload speeds on Verizon’s network are given as 2-5 megabits/second, and AT&T’s network is expected to support the same rate.
Unfortunately, AT&T has no smartphones available to customers that can communicate over the 4G LTE network. The WSJ notes that the company sells only a tablet, two data sticks, and a mobile hotspot that are compatible with the new network. That reduces significantly the probability that customers will complain about network overloading.
The marketing rollout is sure to boost speculation that Apple Inc. (NASDAQ: AAPL) is getting ready to announce a 4G LTE-compatible iPhone next month. Apple has so far been cautious about the higher speed network due to, among other issues, battery life. But if AT&T is kicking out its high-speed network, it only makes sense that Apple will kick out its first 4G iPhone with what amounts to an exclusivity deal with AT&T.
If that’s how it plays out, Apple will have pulled off another coup at AT&T’s expense. The iPhone 5, with 4G exclusively on AT&T’s network, will hold AT&T’s customers while the company pays Apple an even larger subsidy for the new phone.
AT&T’s shares are up about 1% in the late afternoon, at $28.80, in a 52-week range of $23.78-$31.94. Apple’s shares are up about 1.75%, at $399.79, in a 52-week range of $269.50-$404.50.
Paul Ausick
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