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Monday, August 17, 2009

Why iPhone from Verizon Wireless won't happen any time soon

Ever since Verizon Wireless (VZW) announced their LTE migration, I've noticed speculative news articles, blog posts, and tweets on LTE version of iPhone coming from VZW very soon. Some even speculate that the rumored tablet device from Apple will run on LTE network (see Verizon rumored to be pushing up LTE plans to Q1 2010, new Apple device the catalyst?). As I see it, all these seem like wishful thinkings; it is probably at least four to five years before you might even hear any concrete development (if indeed Apple and VZW decide to go in this direction) just because of the technical and market challenges of the early LTE deployments. The following are my reasons:

1. Nationwide LTE service is years away: If you follow VZW's LTE deployment plan, a nationwide LTE service won't happen until late 2013 or early 2014 (see Verizon clarifies LTE buildout plans). Similarly, NTT DoCoMo, one of the early LTE adopters, also sees a meaningful nationwide deployment some time around 2014 (50% coverage by 2014, see NTT DoCoMo plans LTE launch in late 2010). Also, the operators are just now reaping returns from 3G/3.5G services. They will milk their 3G investments as long as possible and will be reluctant to migrate to LTE so soon. So, for the foreseeable future, we will see a limited coverage of LTE networks at best. I doubt that Apple will offer a product that can only cover limited geographical area. One way to overcome this is to have a dual mode (CDMA2000 and LTE) iPhone but why bother including LTE data capability when CDMA2000 network (which VZW currently runs) already offers decent data service.

2. Commercial LTE chips also are years away: Although there have been announcements of LTE baseband modem chips (Qualcomm, LG, NTT DoCoMo, ST-Ericsson, and Samsung) and some prototypes (most notably, from LG and ST-Ericsson), it will take some time for companies to produce chips that meet market expectations. If you look at the previous case of 3G, the standard finalized roughly in 2000 and the first generation of modem chips had numerous performance issues (notably, power consumption) such that the handsets never were usable. Also, because most operators do not see any significant market for LTE in the near future, the demand for LTE modems will be limited and it will dampen the development progress. Now, one interesting factor is that Apple is rumored to be building their own iPhone chips (they acquired PA Semi a while ago which designs chips for mobile terminals). They can easily decide to start building LTE chips for their iPhones but it is unlikely that they could design and build an efficient enough chip so soon.

3. There is still no clear strategy for legacy (circuit switched) voice support in the initial LTE network deployment: If you follow the whole debate on how to support legacy voice calls, which is a hot topic in LTE standards community (see Voice Over LTE & the 'IMS Gap'), you will realize that it will take quite some time to get to a consensus among the major players because technically, the various proposed methods of resolving the legacy voice issue are substantially divergent. Until the operators have a clear universal solution to supporting voice, a full-fledged LTE handset which supports voice and data seamlessly will not be available and iPhone is no exception.

Any comment or feedback is welcome.

- Hyung

1 comment:

Jagadeesh said...

Good thoughts Hyung !!

Jagadeesh