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VoLTE/Rich communications

MetroPCS Plots LTE Smartphones, VoLTE Trials

MetroPCS Inc. (NYSE: PCS) has a Long Term Evolution (LTE) head start that's growing, but to stay competitive after the US gets more 4G options, the operator is homing in on the smartphone entertainment experience.

It was the first to offer a dual-mode LTE smartphone, the subpar Samsung Corp. Craft, but will launch at least half a dozen more next year, many of which will be based on Android, chief executive Roger Linquist said on MetroPCS's third-quarter earnings call this morning. (See CTIA 2010: The LTE Smartphone Scramble, and Samsung Unveils LTE Handset.) "We have the handsets we think we need for our smartphone line-up next year pretty well in place with at least one or two products that need to be firmed up," he said. "We need to see what we have in terms of usage and customer preference."

Tablets are interesting, Linquist said, but right now it's all about the small screen for Metro. He said that the company sees the smartphone evolving to an entertainment-focused device, which is why it launched MetroStudio, a RealNetworks Inc. (Nasdaq: RNWK)-powered media and content service available to subscribers on a US$60 per month LTE data plan.

The phones will be priced around $200 to $500 wholesale, a price Linquist admits is elevated but one he believes his customers will pay.

Linquist's statements came as Metro announced big expansion plans for LTE. Service turned on in Los Angeles and Philadelphia today, and Metro said it's expanding later this year and early in 2011 to Atlanta, Boston, Jacksonville, Miami, New York, Orlando, Sacramento, San Francisco, and Tampa. (See MetroPCS Brings LTE to LA, Philly.)

Metro's LTE network was first launched in Las Vegas, in September, and later in Dallas/Forth Worth and Detroit. (See LTE Watch: Sequans to IPO?, MetroPCS Saddles Up LTE in Dallas, LTE Starts Here, and MetroPCS: Cord Cutting & Video Snacking.)

VoLTE trials planned for 2011
Metro will also trial voice over LTE services in early 2011, Lindquist said, an important step to rounding out its service. (See LTE Voice Lag Leaves Operators Vulnerable .)

"We are planning for the future and making way for migrating voice to voice over LTE," he said, adding that Metro can achieve cost savings by using a worldwide standard. "We have the ability to build capacity without regard for whether it will be used for voice or data."

Regional no more
Back on the 3G front, Metro also launched Metro USA, a CDMA service reaching 90 percent of the country, today. Through undisclosed roaming agreements, consumers now won't incur roaming fees on their unlimited Wireless For All plans, at $40 to $60 per month. (See MetroPCS 3G Goes Nationwide.)

The announcement came with third-quarter earnings, where Metro saw its revenue bump up 14 percent from last year's third quarter, to $1.02 billion, thanks to new subscriber additions. It added 223,000 subs during the quarter, more than tripling its additions compared with this time last year. (See MetroPCS Reports Q3.)

Average revenue per user declined 3.4 percent as Metro introduced all-inclusive rate plans, but churn also fell to 3.8 percent, from 5.8 percent a year earlier, as consumers upgraded to higher-end handsets. (See MetroPCS Gears Up for LTE.)

Its total customer base is now 7.9 million, outdoing its prepaid rival/sometime partner Leap Wireless International Inc. (Nasdaq: LEAP), which lost 200,000 subs in the third quarter. (See Leap Hears Crickets in Q3 and Leap Wireless Looks Ahead .)

Metro's real competition comes from Verizon Wireless , which has yet to launch an LTE network, but will far outgrow -- albeit likely not outprice -- MetroPCS when it does. (See MetroPCS Beats Verizon to LTE in Sin City.)

— Sarah Reedy, Senior Reporter, Light Reading Mobile

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