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Verizon sees phone calls running solely on LTE by 2016

Wireless phone calls still run on the older 3G network, but that's poised to change thanks to a technology called voice over LTE.

Verizon's imposing booth at CES 2012
Verizon's isn't shy about trumpeting its strengths here at CES 2012. Jessica Dolcourt/CNET

The first Verizon Wireless smartphones to run voice calls exclusively over the 4G LTE network won't hit the market until the first half of 2016.

That's according to Verizon Chief Financial Officer Fran Shammo, speaking to Wall Street at an investor conference on Tuesday. Shammo said the company plans to begin offering voice calls over its LTE network toward the end of the year, which promises potentially higher audio quality and features such as a cloud-based video address book. Even with the transition, Verizon will continue to rely on its 3G network for additional coverage.

Verizon, like the other carriers, splits up its wireless traffic, ferrying data such as streaming video and emails over its faster 4G network, while delivering its voice calls over its slower but more reliable and widespread 3G CDMA network. As Verizon has virtually finished the roll out of its 4G network across the country, it believes it is capable of carrying voice calls, which have more of a real-time urgency than an email or Facebook status update.

"For us, when we launch a new technology, we have to make sure our quality is strong because the CDMA network was so strong," Shammo said in the Web cast presentation. "We don't go before we know it's ready."

With voice over LTE, Verizon will be able to juggle voice traffic over both networks, before eventually moving exclusively to 4G. Voice quality is a particularly sensitive subject for Verizon, which has built its reputation on the reliability of its service.

Beyond superior voice quality and features like high-definition voice calls, another benefit of going to 4G is for potentially lower cost handsets. A smartphone with a 4G chip is cheaper than a smartphone with both 3G and 4G chips, so smartphones down the line could be less expensive as Verizon begins to drop 3G support for new phones.

Shammo declined to comment on whether Verizon, the nation's largest carrier by subscribers, will ensure that its voice-over LTE, or VoLTE, service works with other carriers, which are building out similar capabilities now. He said that the technology needs to mature before the carriers get together.

"I don't know," he said. "It's still in its infancy."

Another feature that Shammo is high on is multicast video, which is Verizon's ability to broadcast a single stream of live or taped video to multiple people. The technology is attractive to Verizon because it doesn't take up a lot bandwidth and is a more efficient way to deliver video.

"It's a pivotal point that changes the way content is delivered over mobile," he said.

He is confident there are enough customers willing to watch live video on their smartphones for 30 minutes to justify this business. He believes sporting events such as NFL games or the World Cup make for the best examples of live video that people would want to tune into when they're not around a television.

The Galaxy S5 has a chip able to pick up multicast signals, Shammo said, with more smartphones coming in the fourth quarter. The service, however, won't launch until next year, when there are enough smartphones seeded that can pick up those signals.

Shammo declined to comment on whether consumers would have to pay an extra fee to subscribe to multicast videos, only saying they represented a way for the content companies to generate additional revenue.