4G hype: Time for a reality check
By Stephanie N. Mehta
Wireless carriers tout a new wave of wireless technology but it will be years before most consumers benefit — and before carriers make money.
Verizon Wireless, a joint venture of Verizon (VZ) and Vodafone (VOD), last week announced it had completed data "calls" using its flavor of so-called 4G technology, a new generation of radio upgrades that promises to improve the throughput and capacity of wireless phone networks.
Rival Sprint Nextel (S) immediately responded with a flurry of news releases touting its 4G network, which uses a competing technical standard. In proclaiming its ability to deliver peak downlink speeds of 10 Mbps, one release gushed: "At these speeds, Sprint 4G breathes new life into wireless Internet."
Um, wasn't that what 3G was supposed to do?
Okay, that was a little harsh. But some analysts say the wireless carriers and their suppliers are hyping 4G technologies way before the services –and devices–are ready for prime time.
Indeed, many carriers globally still are building out their third-generation networks, and are only now starting to see returns on their investments, which included substantial payments for additional spectrum licenses.
3G all over again?
"Yay, Verizon made a test call on LTE," deadpans Jane Zweig, CEO of the Shosteck Group, a telecommunications consulting firm. LTE stands for Long Term Evolution, and it is the technology Verizon and many other incumbent phone operators are using to transition to yet another generation of broadband networks.
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