Will the Apple iPad Crush 3G Networks?
The new Apple Inc. (Nasdaq: AAPL) iPad has the potential to be even more of a bandwidth hog than the iPhone, so can 3G networks cope with a new data onslaught? (See Scenes From the Apple iPad Launch.)
The iPhone maker unveiled its latest touchscreen creation in San Francisco Wednesday. The keyboard-free device looks like an overgrown iPod Touch and runs a reworked version of the iPhone operating system. The iPad supports both 3G and WiFi connections.
An unlocked 3G-capable tablet won't be cheap: The top-of-the-line 64GB model will run you $829 with 3G onboard; the 32GB model comes in at $100 less. Apple will charge $130 extra for 3G; otherwise, you buy it as a WiFi-only device, starting at $499.
Apple CEO Steve Jobs described the devices as "unlocked," but AT&T Inc. (NYSE: T) is so far the only announced service provider. Apple says that an unlimited data plan will run users $30 a month, while $15 will buy 250MB of downloads.
A network hog in the making? Jobs has already talked up all the wonderful multimedia activities that will be enabled by this "third category" of devices, such as watching movies and playing online games. As such, Heavy Reading senior analyst Gabriel Brown believes that the amount of data that the iPad can pull down from a carrier network will be "about the same as a netbook," rather than a smartphone.
A single high-end phone like the iPhone generates more data traffic than 30 basic-feature cellphones, according to a study Cisco put out in 2009, while a wireless-enabled laptop generates more data traffic than 450 basic-feature cellphones. (See Cisco: Video to Drive Mobile Data Explosion.)
AT&T Inc. (NYSE: T) has already admitted that it has had trouble supporting all the data traffic generated by iPhone users in NYC and San Francisco. U.K.-based mmO2 plc (NYSE/London: OOM) also said recently that iPhone users had brought down its network in London.
What could a popular device that generates significantly more traffic than an iPhone do to carrier's network? Independent technology analyst Carmi Levy believes that the iPhone episodes illustrate that carriers will have up to bolster network capacity over time to support more powerful devices.
"If the iPhone experience is anything to go by -- and we have every reason to believe that it is -- then wildly popular, data-rich mobile devices will become serious drains on network performance only after they've hit critical mass in the marketplace," he tells Unstrung.
"But failure to plan in advance for this new reality of high speed wireless access could permanently damage a carrier's brand in much the same way AT&T has suffered because of its iPhone-related 3G network slowdowns and outages."
Levy says the iPad could take up to two years to hit that critical mass. The device, however, is not the only high-capacity broadband device hitting the market now. Along with the iPhone, Google (Nasdaq: GOOG) Nexus, and Nokia Corp. (NYSE: NOK) N900, there are a slew of new wireless-enabled notebooks and netbooks competing for bandwidth.
— Dan Jones, Site Editor, Unstrung