Verizon's Surprise Evolution

NEW ORLEANS -- CTIA Wireless 2003 -- Verizon Wireless took many people by surprise this week when it announced plans to launch a new, high-speed CDMA network service for business customers in the third quarter of this year.

The company says it plans to launch CDMA2000 1xEV-DO (EVolution, Data Only, acronym fans!) services in Washington, D.C., and San Diego later this year, following successful trials. EV-DO networks crank up the data rate to a theoretical 2 Mbit/s, but offer between 500 and 900 kbit/s in the real world. This is at least ten times faster than current U.S. cellular networks (CDMA2000 1xRTT and GPRS -- see A Wireless Taxonomy for more detailed definitions).

Initially the carrier will provide business users with EV-DO cards that slot into their PCs to access the service.

However, the launch blindsided many attendees at the Cellular Telecommunications & Internet Association (CTIA) show, down by the ol' Mississippi. That's because Verizon Wireless CEO Dennis Strigl told a conference last December that the company wouldn't implement EV-DO anytime soon, due to bandwidth concerns (see Verizon's EV-DOn't).

That announcement was designed to put the competition off the trail, reckons Perry LaForge, executive director of the CDMA Development Group (CDG), an industry association for the CDMA community. "A lot of that had to do with positioning," LaForge contends. "He didn't want to lead anyone to believe that the [EV-DO] path was open."

Dr Paul Jacobs, group president of Qualcomm Inc.'s (Nasdaq: QCOM) wireless and Internet group, and son of Qualcomm CEO Dr Irwin Jacobs [ed. note: is there a Dr in the house?], reckons Verizon's move could spur CDMA rival Sprint PCS (NYSE: PCS) to re-examine its stance on EV-DO.

"Sprint has the mindset of being an innovator, and Verizon has definitely stolen a march on them this time," Jacobs the Younger says.

Publicly, Sprint has committed to leapfrogging EV-DO and upgrading to CDMA2000 EV-DV (yep, that's evolution, data/voice, the next step up from EV-DO, adding voice to the equation).

However, some terribly cynical people Unstrung spoke to are not convinced by Verizon's EV-DO announcements. After all, they say, Verizon is simply commercializing its trial sites, using test equipment supplied by Lucent Technologies Inc. (NYSE: LU) (Washington) and Nortel Networks Corp. (NYSE/Toronto: NT) (San Diego).

The proof of Verizon's commitment to EV-DO will come when the operator announces a larger rollout, say the cynics, who wished to remain anonymous (as cynics often will).

Verizon Wireless was unavailable for comment.

— Dan Jones, Senior Editor, Unstrung