Optical/IP Networks

Verizon, Vodafone Head for LTE

Vodafone Group plc (NYSE: VOD) and Verizon Wireless are working towards adopting the same 4G technology, with Long-Term Evolution (LTE) the most likely platform to be chosen.

Vodafone CEO Arun Sarin and Verizon Communications Inc. (NYSE: VZ) CEO Ivan Seidenberg both told a Goldman Sachs & Co. investor conference Wednesday that they are planning to use the same technology in the next major evolution of their wireless networks, and that the two companies are involved in LTE development work.

News of the CEOs' speeches, reported by Thomson Reuters and confirmed by Vodafone's press relations team, is significant for a number of reasons.

Common approach for partners
Vodafone owns a 45 percent stake in Verizon Wireless (the rest is owned by Verizon Communications), yet the two mobile giants currently use different network technology.

Vodafone is a GSM operator that has built out its 3G network using HSPA (High Speed Packet Access) technology. Verizon Wireless, meanwhile, is a CDMA operator that has build out its 3G network using CDMA EV-DO (Evolution Data Optimized) Revision A technology. (See Vodafone Soups Up HSDPA, Verizon Does EV-DO in MN, and Verizon's Rev A Gets Carded.)

HSPA and EV-DO are not compatible technologies, which means Vodafone and Verizon Wireless subscribers can't roam onto each others' networks, and the two operators can't enjoy economies of scale from joint procurements.

Adopting the same network technology would allow the two operators to work more closely together, potentially cut costs, and enable their subscribers to roam onto each other's networks. Verizon Wireless currently has more than 62 million subscribers, while Vodafone has more than 200 million customers around the world.

LTE has been developed to provide a migration path to HSPA, but it could also be used by EV-DO operators.

Reuters reports Sarin as saying: "It makes complete sense for us to go from HSDPA to LTE and it makes sense for Verizon to go from EV-DO to LTE." Sarin added that it would be another three or four years before LTE could be deployed.

That's because the technology, which is set to enable wireless data access speeds of up to 100 Mbit/s or even more, is still in the 3rd Generation Partnership Project (3GPP) standards development process, with a first version due to be published before the end of 2007.

All the major mobile infrastructure vendors are already developing LTE platforms, though, and Japanese mobile operator NTT DoCoMo Inc. (NYSE: DCM) says it's testing LTE in its labs. (See DoCoMo Tests 'Super 3G' and Ericsson Demos LTE.)

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