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The long wait for WiMAX in the Windy City as well as the DFW Metroplex is over -- as we expected, Clearwire is now selling services in both cities, keeping with the company's strategy of "soft launching" markets online before staging an "official" market opening with all the attendant hoopla.

Since it's Nov. 1, time for a new map -- and the one on the Clear.com website now shows Chicago "in the green" of Clearwire services, while adding Dallas/Fort Worth to the list of cities with service in Texas.




In North Carolina, the cities of Charlotte, Raleigh and Greensboro are also now listed as "live," so it looks like Clearwire should be able to make good on its promise to step up subscriber numbers in Q4, simply by having lots more markets selling services.

The big ones, however, are Chicago and Dallas -- two huge metro areas where Clearwire will see how it fares against existing service providers. In Chicago, Clearwire also has its first true "commuter" city, since thousands there ride the rails every day, to and from work, play, school and in just general getting-aroundness.

Will WiMAX's ability to connect while mobile make a big impression? We are only now just going to find out. We'll have some more thinking on Clearwire market launches later this week. And yes, the launches mean that Sprint's 4G services are available there too. Meanwhile, more detail from the Chicago maps below.

It may be that ATT is good as it gets with the iPhone.

I have already commented on the fact that Telefonica is not having the same dramatic impact with the iPhone as ATT (Verizon [ NYSE: VZ] announced a 30% drop in earnings and slower growth than ATT ).

In China the Nokia E71 has a good following (I am still an N95 fan) and the  cost of the iPhone is equivalent to a $1,000 US dollars over there.  The discussion of Nokia's efforts to protect patents Apple may have violated seems late, but I suspect it will work itself out like many of these do before the court has to make a decision.  IMHO, It probably has more value in the EU to show market / thought leadership than financial value.

More importantly as China continues to manage the operations of their end users the ability to use WiFi has been disabled.  Like the issues of Skype via TOM in China, a closed iPhone with only the carriers network is not as interesting as an IPhone with WiFi.  However, it allows the state to know what it wants to know.

Of course in China if you capture less than .001 of the market you are still busy, so the iPhone success is pretty much a guarantee.

Editor's note: The following is an excerpt from our latest quarterly report on all things Clearwire, the CLEARWIRE NTK OCTOBER 2009 (need to know) report, available now for the low low price of $4.95. In this excerpt we talk about how Clearwire's on-time, on-target market launches in Atlanta and Las Vegas, as well as a host of smaller cities, have kept the company on target with its ambitious 2009 rollout plans. For the full report, order online here. Report excerpt follows:

Vegas, Atlanta and Silicon Valley - but where is Chicago?

Easily the most positive sign for Clearwire during the hot months was its on-schedule rollout of services in Atlanta and Las Vegas, the two bigger markets Clearwire had said it would launch during the summer -- and did. Perhaps catching many WiMAX watchers by surprise was Clearwire's August/September launch of an additional 10 markets for its new, mobile WiMAX services -- a list that included several small Texas towns like Lubbock and Abilene, as well as Boise, Idaho, and Bellingham, Wash.

The quick addition of the smaller markets was a pretty easy strategy to figure out if (like us) you had studied Clearwire closely. Since Clearwire has said many times that the hardest and longest task of launching any new market is getting its towers sited, approved and constructed, it stands to reason that any market where the company already had a tower position could be converted to the newer mobile WiMAX service pretty simply, with maybe an antenna change and some new networking gear on the back end.



At the end of September 2009 there were already reports surfacing about Clearwire quickly upgrading pre-WiMAX customers in some of its remaining 40 old-school markets, and on Oct. 1 the company "lit" two smaller markets (Milledgeville, Ga., and Salem, Ore.), while also making services available in Philadelphia.

Not as meaningful from a subscriber number but worth its weight in market influence was Clearwire's quick launch of its planned "testbed" network for developers in Silicon Valley, with separate clouds covering the campuses of Google, Cisco and Stanford University. Though some saw the testbed launch (which was announced back in May) as a public-relations stunt, from a business standpoint it seems to make perfect sense to put the service in front of folks who make up what is still arguably the world's foremost center of technological innovation and investment.

According to Clearwire, it will offer select subscriptions in Silicon Valley for free, while allowing any other developers in the area to sign up by joining the company's developer program, and then purchasing approved client gear for $50.

In commercial markets, Sidecut Reports was fortunate enough to be on hand, in person, for the "official" launch of services July 21 in Las Vegas, where we learned the following lessons: 1) Clearwire is going to be intensely local with its promotions going forward, which means that national roaming is not going to be a big selling point; 2) The company seems to be putting value ahead of mobility, which we think is a smart move since without a smartphone device,WiMAX isn't as sexy as, say, an iPhone 3GS or a Palm Pre; and 3) the company is going to enlist as many resellers as possible, from the very big (like Comcast and Sprint) to the very small (single-owner shops and mall kiosks) to help get the word out.

To get a feel for how this will roll out, consider the Clearwire sales footprint in the greater Las Vegas metro area: According to Clearwire, it only plans to operate five "branded" outlets in Vegas, including two storefront operations and three mall-based kiosks. The balance of the company's contracts will be sold by a list of 80-plus authorized resellers, including sales locations inside six Vegas-area Best Buy stores, 24 Radio Shack locations, and the rest independent resellers. The key for Clearwire is that all contracts will be with the parent company, and not resellers -- so no matter who signs a customer up, Clearwire will own the billing relationship.

For all the Clearwire knowledge you NEED TO KNOW for the latest quarter, order our CLEARWIRE NTK OCTOBER 2009 report today for just $4.95 -- that's right, less than five bucks for a lengthy take on Clearwire market launches, device plans, business news and more.

Editor's note: The following is an excerpt from our latest quarterly report on all things Clearwire, the CLEARWIRE NTK OCTOBER 2009 (need to know) report, available now for the low low price of $4.95.

In this excerpt we talk about why we think the lack of interesting WiMAX end-user devices (or the overpriced ones that did launch) have kept users from flocking to Clearwire's 4G wireless broadband offering. For the full report, order online here. Report excerpt follows:

Prices and Devices: Waiting for a reason 'Why' to try WiMAX
Without a doubt, the coolest thing about WiMAX is its ability to provide a true broadband connection with cellular mobility. One of Clearwire's biggest problems, however, is a lack of a compelling reason to take advantage of that mobile connection -- and the dearth of devices that would allow you to even try.

The growing popularity and use of smartphones points to another WiMAX weakness -- the lack of truly portable devices that can take advantage of the technology's superior connectivity. As Clearwire CEO Bill Morrow showed during his 4G World keynote speech in September, in a side-by-side download speed comparison WiMAX leaves 3G in the dust.

But even the (videotaped) demo itself showed a bit of the WiMAX underwear peeking out: To make the tricky demo -- it was a side-by-side screenshot of two iPhones in a car driving down the road -- all the "regular" iPhone had to do was connect via the 3G cellular network; the WiMAX powered iPhone had to connect via Wi-Fi to a Clear Spot router in the car, which was connected to the WiMAX network via a plug-in USB dongle.

So: The WiMAX iPhone was faster, yes, but its kit was also more expensive and in need of a stylish European man-bag to tote all the extra gear around. Though hybrid WiMAX smartphones do reportedly exist -- HTC claims to be selling one for the Yota WiMAX network in Russia -- Clearwire's customer base so far doesn't seem to be big enough to convince device makers that producing such a beast is worth it.

The one vendor that did launch a cool handheld WiMAX device -- Samsung's Mondi, unveiled at the Vegas Clearwire launch -- turned out an overly expensive, somewhat confusing form-factor machine that wasn't big enough to do "real" laptop work. It also doesn't contain an alternate cellular link to make voice calls an easy proposition.

To top it off, Samsung and Clearwire couldn't even get their pricing message straight -- in Las Vegas, a Samsung PR representative told us that the device would sell at $450 unlocked, or $350 with a two-year Clearwire contract. But a few weeks later when Clearwire started offering the Mondi, the subsidy discount was nowhere in sight -- the device would be $450 to all users, contract or no contract. Meanwhile, the iPhone 3GS sells for $199 with a two-year contract. Any questions?

For all the Clearwire knowledge you NEED TO KNOW for the latest quarter, order our CLEARWIRE NTK OCTOBER 2009 report today for just $4.95 -- that's right, less than five bucks for a lengthy take on Clearwire market launches, device plans, business news and more.

It's game of inches as they say. 

I have been looking at the reporting about Verizon's App Store activity and find the perspective of some pundits troubling.

As I reported when I went to the Verizon Developers Conference, the goal Verizon has is very different than being the equivalent of the iTunes AppStore.

Lets be honest, how many of us have looked at all 65,000 apps, and how many of us really want to.

Verizon announced a partnership with Vodafone, China Mobile and Softbank to deliver applications their way.  Very specfically Verizon was looking to open the interfaces for location, billing and trust (security).  I noted that their strategy was associated with a API that masked alot of the behind the scenes OSS work. 

Carriers and cellphone vendors have procedures for turning on the phone that represent over 100 steps in provisioning and configuration.  Verizon has tried to make the network valuable without having the carrier's internal OSS stifle the developer.  The one requirement is work within a framework. A lot of the companies that are on the iPhone do not like this framework, and it shows in in the blogosphere.

So Vodafone makes its announcement about their efforts to build Vodafone 360 which to me is a another strategy in keeping with the alliance, but is not getting the anger yet.

I think the reason maybe be that Verizon is in the California footprint and the developers are asked all the time "Can I use it on my phone" and since VZW is big in California, the answer frustrating.

In a panel discussion at 4G world the general opinion was that USF will be modified to include the ability to support wireless broadband strategies.

"Their is growing consensus that Universal Service should include wireless" said Hank Hultquist of ATT.  Many panel members echoed these comments, but the details as to what will be included were not the full topic of the discussion.

Currently the definition of broadband is under discussion at the FCC. 

Many carriers are worried that a definition now may be unattainable as they service the growing data needs of the consumer.  Previously Kris Rinne, 4G CTO of ATT, stated that they were seeing a 4000%  growth in the data traffic since the adoption of the iPhone and other smartphones.

Questions that will have to be addressed include whether the addition of wireless to the fund will be associated with reform to the fund itself or as an addition.  Current adminstration members were instrumental in the development of the USF in the Clinton adminstration and have a favorable view to the model.

However the costs associated with the High Cost land line services may not be valid when talking about Wireless strategies, and it may be that the inclusion represents alternative services as well via the E-rate model.

It has been suggested that many of the proposals attempting to use the stimulus dollars are similar in ownership structure associated with E-rate.

I was looking at Guardian reading about the merger of the Orange and T-Mobile assets in the UK.  This 50/50 merger seems to me a great deal particularly for T-Mobile.  Orange from most accounts was the better built out network than the T-Mobile acquired assets.

I expect that some consumer concerns are going to impact the restrictions on the merger but the merger will go through.  The biggest issue is that Vodafone the UK based company just got passed in market share by other carriers making them number 3.

Its a vibrant market and if O2 was allowed to become part of Telfonica, and has Hutcheson (branded as 3) representing other foreign investors in the space the consolidation of foreign investors is a good thing. 

As for impact, I could make a case that 3 and Virgin will find a way to work together.  By in large Richard Branson has lost his taste for Telecom is more focused on energy issues (even before smart grid became the fad).  However, the opportunity may be with one of the other large players.

The analysis in the UK about the need for 5 wireless competitors should be put in perspective to the EU's over all view.  The EU commission sees all the services as blended, as ultimately they are, so landline operators, cable and other technologies should be pointed out as reasons to think beyond the monopolistic fears.

On a worldwide scale the more interesting question is should we expect more of the same.  I have often felt that T-Mobile and Sprint would be a good combination, but they do not have a common history in the US.  But strangely enough, Orange has a past with Sprint, so maybe the ball will get rolling towards some US talks.

There was a little cold-water type reality splashed on the audience at the morning panels here Thursday at the 4GWE conference, specifically around the notion of 4G network and device testing -- a relatively non-sexy topic that may nevertheless slow down the delivery of all the new devices promised for the 4G networks of the future.

The problem, as outlined by the panelists, is that with the increased bandwidth and increased functionality of the mobile devices of the future comes exponential requirements for testing to make sure the devices and the applications residing on them work as promised.

There was some deep-dive material that we're not going to get into right now (check this space for an update when we post the panel presentations) but on a simpler plane panelists like David Gehringer, VP of marketing for Fanfare Software, noted that things like the IEEE standards, say for mobile WiMAX, are really just the starting point for delivering a working device.

"It's nice to have a standard, but it's really just the ante," Gehringer said. After you meet the baseline standard specs, he said, "then the real testing starts."

Fanny Mlinarsky, president of octoScope, said that in the past testing mobile devices was relatively simple, since they typically only had one radio inside. Now, multiple radios -- different cellular bands, as well as Wi-Fi and Bluetooth -- are a given, as are multiple applications, sometimes from third parties outside the carrier's own operations.

The complexity, she said, makes testing devices a much harder task these days. Even Apple's iPhone, which all panelists agreed was an extremely well-tested device from the manufacturer's standpoint, has attracted a wide range of add-on applications, some of which perform better than others -- especially when it comes to battery usage.

"That's why iPhone users stay close to the power plug," Mlinarsky said.


 

Here's another look at the WiMAX-fueled bandwidth we are enjoying here at the 4GWE conference -- thanks to Towerstream. (For clarity's sake Towerstream CEO Jeff Thompson said the 10 Mbps link is not "official" WiMAX but a proprietary Towerstream implementation... to us it's just backhaul and it's working pretty well.)

This link is from the WiMAX to a Wi-Fi access point... lots of folks on the net, very few problems.

There's an overflow crowd here at the 4GWE session on femtocells, so I'll try some liveblogging to keep you in the flow of the discussion if you're not here in the room with us. Keep refreshing this post, we are adding as it goes along.

What is a femtocell? David Chambers from Amdocs, our session moderator, gives the overview: It is basically a "complete [cellular] base station, shrunk to size."

Chambers says North America is a ripe femto market, since it has poor cellular coverage, good wired broadband, and people with money to spend. Theoretically :-)
David Nowicki, VP of marketing and product management from femto manufacturer Airvana, now speaking. Talking about the femto forum -- industry group promoting femto standards.

Femto Forum -- 43 operators, covering 1.3 billion subscribers; 17 of the top 20 mobile operators playing together.

What does the consumer get out of installing a femto? David says there's an 80-page white paper on the forum web site, woof! We'll read that later. Talking now about a family adding a femto to their house... it costs the operator at least $400 up front to integrate the device in -- but over the life of the customer contract it is worth it because ARPU goes way up. Could double the ARPU.

The family uses more data -- adds big-bucket calling plans -- more services, like TV -- so femtos can be a way to bring more bundles into a subscriber contract. Plus it offloads some data from the service provider network -- more savings.

Who will want femtos? Two-thirds (according to analysis) of customers are wireline customers who want mobility as a complementary service. Makes sense since you need a wired connection (ed. note -- or something like Clearwire's WiMAX) to connect the femto.

Now speaking: Don Troshynski, technical director at Acme Packet, going to talk about back end stuff. Why would you use a SIP-based femtocell? Going beyond R99 phone, get ready for IMS deployments.

SIP also means a need for controls... watching for DOS attacks, latency is a worry... so you need to make sure this is a well-engineered box. Worms and viruses, oh my! (little bit of fun animation on the powerpoint). Overall message: You have to consider the overall security solution when you are deploying these as a service provider.

Now up: Barlow Keener, Keener Law Group, on legal/reg issues of femto deployment.

Says the FCC first mentioned "femtocell" in Feb of 2008. They are "taking notice" but no rulemaking or decisions ... yet! 

Macro towers are now surrounded by barb-wire fences... now we are going to put those kind of towers into the hands of consumers, who can hack them, play with them, take them on vacation... "take it to Vermont, because I can't get service there."

Comparing VoIP regulation... net neutrality regulation... "femtocell looks a whole lot like VoIP service." Where will femto links fall when FCC takes a look? (And they WILL look, regulation normally lags the deployments)

Also need to think about 911 calls... triangulation... since you don't know where the antenna is, "much more difficult" to determine where the caller is calling from. GPS chip? Won't get to satellite in a building. "This is going to be an issue."

Billing -- providers don't want to talk about this. Roaming issues created when you move a femto to someone else's licensed territory... minutes that go through femto would be considered roaming... this could get ugly! (ed. note: Will airport security check you for femtos?) Could Internet providers "block" calls coming in through a femto? (ed. note: sounds like the full employment act for those lawyers who don't have net neutrality to argue about anymore)

Now open for audience questions. Any out there in cyberspace? email me at kaps at sidecutreports.com and I will relay.

Moving about -- can you bring your femto with you? Panelists say no, you can move to an area where your provider has spectrum, but not in other places. Apparently people tried this in Asia -- took their femtos with them, made "local" calls on the road. Providers will sniff this out, block it. (ed. note: Let's get ready to rumble!)

Question now about billing... guess from panel is that there may be "overflow" pricing, where if you don't use femto bandwidth you can roll it over. Might carriers bundle fixed service and femto mobile? "Hard to predict" what the billing dynamics might be. Could it cannibalize mobile services? Answer -- service providers are pricing this different ways. Sprint, $10 a month, all the calls you want. In Japan femtos are free -- create value by "recruiting" other family members to services -- or via apps like parental control, etc., specific to the femto. Too early to generalize how femtos/services will be priced.

Acme Packet's Don -- may be worth it to the operator to sacrifice price for benefits.

Keener -- says "it will come back to the lawyers" because of class action suits like the ones against AT&T and Apple about iPhones not performing. RAN engineers say they can't handle all the new data, femtos a way to offload.

Moderator David Chambers throws this one out: Is Wi-Fi (combined with things like Skype) a worthy competitor to femtos? Is that the real 4G competition, and not WiMAX vs. LTE? Acme Packet's Don: not going to replace the convenience of cellular. Keener: Think we are heading toward true convergence -- use Truphone, Skype... voice revenues dropping, the ability to deliver data will count more. That means ARPU will drop.

Airvana Dave: It will be both... all phones support femto, some will support Wi-Fi. 20 percent of handsets now have Wi-Fi... look at iPhone? Allows you to use Wi-Fi for Internet, but no operator (AT&T) services over Wi-Fi. Use both, for two different services. Keener again: OK to use Skype over your data "minutes"? (ed. note: Guessing this may be part of the next net neutrality battleground, don't you?)

Good audience question: Is a femto a better in-building solution than Wi-Fi? Airvana's Dave: That's what it's all about. If you want to support voice and data, do both. Femto primarily so everyone can make calls... Wi-Fi, good way to do Internet access. You could set up a network with only femtos... both voice and data, think if doing it today, still early days and you would do both. 

Audience: Is there a femto/Wi-Fi combo? Airvana's Dave -- manufacturers have such products, they have not been offered yet. Three years from now, you'll see mainly an integrated product. Keener "takes his lawyer hat off" and talks about the home gateway -- aka Holy Grail for the Netgears of the world. Music, video downloads, etc., to be stored there... (ed. note we have heard this idea before... but Tivos are still a niche... )

OK, got to sign off to do moderator duties. Thanks for reading!