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Which wireless firm carries the most data traffic?

AT&T has been claiming that it is the nation's leader when it comes to wireless data, but a report from ABI Research contradicts that assertion. Who's right?

AT&T's claim that it carries the most wireless data traffic on its network is being challenged.

An ABI Research report released this week states that both Verizon Wireless and Sprint Nextel handled more data traffic last year than did AT&T. Verizon and Sprint each carried over 16 billion more megabytes of mobile network data than AT&T in 2009, the report noted.

Together, the report added, Verizon and Sprint carried 63 percent of the U.S. market's mobile network data traffic last year.

Meanwhile AT&T, which has been bashed over the past couple of years for poor network service due to a congested wireless network, asserts that it carries more wireless data traffic than any other operator, that it accounted for 50 percent of the nation's mobile data traffic last year, that data traffic on its network has increased 5,000 percent over the last three years, and that it has twice as many smartphone customers as its closest competitor, Verizon.

Much of this data traffic growth has come from iPhone users, who AT&T claims use 10 times more data than average cell phone users.

"It is not clear how ABI Research reached its conclusions, but I can tell you that our research and analysis of other third-party data indicates that AT&T carries more mobile data traffic than any other U.S. provider," Mark Siegel, an AT&T spokesman said. Siegel also said that AT&T had not been contacted to provide data for the report.

ABI analyst Dan Shey said his group used third-party data and primary data from carriers to compile its report. Shey, the analyst who put together the report, said that the calculations include all 2G, 3G, and 4G data traffic for all devices, including cell phones, smartphones, laptops, and other device connecting wirelessly to the Internet via a cellular network.

Shey conceded that AT&T has more smartphones and activated 3G devices on its network than the other operators. However, he said, Verizon and Sprint surged ahead because they have more wireless laptop customers who use air cards or have wireless modems built into their laptops or Netbooks.

Because laptop subscribers use significantly more wireless resources, Shey said, it makes sense that these operators carry more data traffic than does AT&T. This helps explain why Sprint, which has far fewer customers overall than AT&T, could still end up carrying more data traffic.

"Verizon and Sprint have more laptop users connecting to their networks," he said. "Business customers were the initial users of this service, and Verizon and Sprint have targeted them with this service."

Shey also explained that Verizon and Sprint have likely not had the same network headaches that AT&T has had because their 3G networks cover a larger area. AT&T's 3G wireless network is considerably smaller geographically. (Just check out Verizon's advertisements in which it compares coverage maps.)

Many of the problems that AT&T has experienced have been due to subscribers moving between 2.5G and 3G coverage areas. AT&T also has a lot more of its heavy users concentrated in densely populated urban areas. Meanwhile, Verizon's and Sprint's customers are spread over a wider 3G footprint, which means much less switching between networks. Shey said this could explain why their subscribers have reported fewer problems.

Ultimately, Shey acknowledged, it doesn't really matter which operators carry the most data traffic now because collectively they will all be carrying much more in the future. By 2014, nearly all operators will see an eight-fold increase in data traffic, according to the report. Carriers not only need to prepare their networks with more capacity, but they also must come up with pricing and other incentives to help ensure that the growth is smooth and the usage is consistent without becoming overwhelming.