Verizon to launch 4G in 38 markets

SAN FRANCISCO--Verizon Wireless provided more detail today about the launch of its long awaited 4G wireless rollout, but the company still didn't reveal pricing or device information.

At the CTIA fall 2010 trade show here, Verizon Communications Chief Operating Officer Lowell McAdam said the company plans to launch its 4G wireless network in 38 markets by the end of 2010 and it will cover about 110 million people with the 4G service when the service is launched later this year.

Markets that will be in the initial launch include New York City, Chicago, Los Angeles, Boston and San Francisco among others. McAdam said Verizon will cover 70 percent of these markets with the service. And it will offer 4G in 62 airports, including airports in seven cities that are not part of Verizon's initial 4G launch. The network will be rolled out over the next three years, much the same way the carrier rolled out its 3G wireless network several years ago.

Within 18 months, Verizon expects to blanket the entire country with the service serving about two-thirds of users in its footprint. Specifically, McAdam said by the end of 2011 it will be able to serve 200 million people with the service. And by the end of 2013 it will be available to more than 285 million potential customers.

McAdam also said that Verizon has seen tremendous interest from smaller rural carriers that want to lease the company's wireless spectrum to offer wireless broadband in areas where services don't exist and places where Verizon is unlikely to reach anytime soon in its rollout. The company has already struck deals with five rural broadband operators and is in negotiations with another 12 operators.

The company did not provide specific pricing details or say when exactly the network will launch. It previously indicated that 25 to 30 markets would launch by the end of 2010. During a question and answer session at a press conference, McAdam indicated the company will eventually move to a tiered pricing model for all its data services. But he wouldn't specify whether the LTE service will initially launch with a tiered plan.

"We think there is a place for unlimited plans," he said. "But there is a finite amount of spectrum and over time customers will need to shift consumption to pay as you use. I don't think that LTE forces to move in that direction, but clearly over time we will migrate to buckets of megabytes and gigabytes so that people use what they need."

In February, Verizon Wireless CTO Dick Lynch indicated the company would initially launch the service with USB air cards that access LTE for its laptop customers. McAdam confirmed that the initial devices on the network would be PC air cards with cell phones and other mobile devices with embedded LTE to follow.

The company will be offering smartphones and tablets that use the LTE network in the first half of 2011, McAdam said.

"I want to dispel the myth that the LTE network is just about USB modems," he said. "Come see us at CES in January and we'll show you half a dozen smartphones and tablets from top OEMs that will be available on LTE the first half of the year."

He would not comment specifically on a Wall Street Journal article published Wednesday that a Verizon iPhone will be coming out in January. But he once again indicated that a deal with Apple to put a device on Verizon's LTE network would simply be a matter of time.

"These rumors (of a Verizon iPhone) roll out every few weeks whether there is a basis for it or not," he said when asked by a reporter about the WSJ story. "We expect that at some point in time our business interests (with Apple) will align. And LTE is another great reason for a device like the iPhone or a tablet (on Verizon.) But we don't have anything to say about the timing of it right now."

Verizon is using 700MHz spectrum that it acquired in a Federal Communications Commission auction to build the network using a technology called Long Term Evolution, or LTE. The company has been saying for more than a year that will launch the network by the end of the 2010. Meanwhile, Sprint Nextel, which launched its 4G wireless network using a technology called WiMax has been on the market for two years with its service.

Sprint's service is being built by partner Clearwire, which is deploying the network nationwide and is already in more than 55 markets with the list growing almost weekly. Sprint already has two 3G/4G handsets on the market, including the popular Google Android HTC Evo.

McAdam did his best to downplay his competitors network during the keynote speech.

"There's a misconception that all 4G networks are the same," he said. "They are not. There is a lot that goes into building these networks including backhaul and a seamless coast to coast footprint."

He touted Verizon's spectrum position with the 700MHz spectrum, which he said has better in-building penetration than other spectrum that operates at a higher frequency. Even though he didn't specifically name Sprint's network, he indicated that Verizon's network was in a better position to handle new applications, such as machine-to-machine connections because of the strong in-building penetration.

Considering the lack of detail that Verizon included in this specific announcement, it's clear that the company is simply trying to position itself competitively against Sprint and its news of new devices and additional markets for its 4G network.

While some details were provided Wednesday, it seems that all the juicy information, such as pricing and device details for Verizon's 4G service will be available at the Consumer Electronics Show in January.

I sat down with McAdam for a one-on-one interview that will have some additional details about the LTE news from today. I'll post an edited Q&A of our conversation later today. So stay tuned.

Update 1:30 p.m. PDT: This story has been updated with additional information from the Verizon Wireless press conference and further analysis about Verizon's 4G network with respect to its competitors.