AT&T Wireless launches 3G in four cities

AT&T Wireless Services Inc. on Tuesday launched a third-generation (3G) mobile data service in Detroit, Phoenix, San Francisco and Seattle that it claimed offers an average of 220K to 320Kbit/sec. of data throughput to two handset models and one type of modem.

The Wideband Code Division Multiple Access (WCDMA) technology is also being rolled out in San Diego and Dallas for expected commercial launch by the end of the year, the Redmond, Wash.-based mobile operator said in a statement.

Customers of AT&T's service will be able to use streaming audio and video services, create and share video clips and use business applications over the new high-speed service, the carrier said. The service costs $24.99 per month on top of a voice plan for consumers, and for business customers, it costs $79.99 per month in addition to a voice plan.

WCDMA, also known as Universal Mobile Telecommunications System (UMTS), is the 3G migration path from Global System for Mobile Communications (GSM), the 2G cellular technology used by AT&T Wireless as well as by Cingular Wireless, which agreed in February to acquire AT&T. That deal is expected to close by the end of this year. GSM is the most widely used cellular technology in the world, but in the U.S. and some other countries it faces competition from CDMA.

The next-generation cellular technology for CDMA, called Evolution-Data Only (EV-DO), got a head start on WCDMA in the U.S. last year when Verizon Wireless launched services in San Diego and Washington. That service is still available only in those two markets, but Verizon expects to make it available to one-third of its customers by the end of this year. Sprint Corp. expects to begin rolling out EV-DO later this year and offer it nationwide by early 2006.

The claimed speed of EV-DO is a bit higher than for AT&T's network, at an average of 300K to 500Kbit/sec. The peak rate of EV-DO is 2.4Mbit/sec., compared with a peak rate of 384Kbit/sec. for WCDMA. But AT&T's network could be upgraded "easily and cost-effectively" to High Speed Downlink Packet Access (HSDPA), with a peak data rate of 14.4Mbit/sec., according to the statement. The change would be primarily a software upgrade, according to AT&T spokesman Ritch Blasi. HSDPA is still in the testing stage, he said.

In the markets where UMTS is live, AT&T is offering two handsets for it -- the Motorola Inc. A845 and the Nokia Corp. 6651 -- each priced at $299.99 with a service plan. It's also offering a PC Card modem for $149.99 with a one-year business contract at $79.99 per month.

For use outside UMTS coverage areas, the devices are backward-compatible with General Packet Radio Service, which delivers about 40Kbit/sec. They don't support Enhanced Data Rates for GSM Evolution (EDGE), a faster data service deployed throughout AT&T's network. AT&T expects some future devices to support this technology. Under a special offer available now, business customers who sign up for two years of service at $79.99 per month can get an EDGE modem free, Blasi said.

"From the point of view of devices, AT&T Wireless offers a broader choice right now" than does Verizon for its EV-DO service, said Forrester Inc. analyst Lisa Pierce. Verizon today sells only modems and no EV-DO handsets.

However, the race between the two technologies won't really take shape until each has much more coverage, Pierce said. For one thing, the speed that users get will depend on how much a particular carrier invests in base stations and performance enhancements, not just the top speed of the basic technology, she said.

It's too early for enterprises to start testing 3G services, unless they have significant operations in cities where the services are offered, according to Pierce.

"It makes sense to do that if you have a user base there and IT resources that can refine applications," she said.

In addition, traveling employees need to know the service is available in the cities they visit.

"It has to get in more major markets before business customers will pilot it," Pierce said.

Copyright © 2004 IDG Communications, Inc.

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