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T-Mobile USA 3G Network, United States of America




Key Data


In November 2006 T-Mobile USA announced the rollout of its first 3G (UMTS) network in the United States. The company is the smallest mobile telecommunications company in the US, although it is one of the major players in the European market. T-Mobile USA is to invest $2.7bn on a 3G network rollout (3G-Plus).

Until October 2006 the company was constrained by a severe shortage of wireless spectrum in the US, which meant inferior reception in many areas and many more network busy signals than its bigger rivals. In the latest Federal Communications Commission (FCC) spectrum auction (auction 66) T-Mobile USA bid $4.2bn to ensure that it was the high bidder for 120 licenses in markets across the US and so would gain use of a usable range of AWS (advanced wireless services) spectrum in the 1.7GHz and 2.1GHz bands for data and voice services. T-Mobile USA has more than doubled its average frequency coverage in the top 100 US markets, from 25.9MHz to 52.2MHz.

The company is deploying UMTS technology for the new network and it expects to start offering 3G services in several markets by mid-2007, to substantially complete rollout by 2008 and finally complete the network by 2009. All of the other US mobile telecommunications are much further ahead with their 3G networks. But as the take up of 3G services in the US is expected to be slow this should not be a problem for T-Mobile.

T-MOBILE USA

T-Mobile USA was known previously as VoiceStream Wireless (formerly a division of Western Wireless but spun off as an independent company in 1999 and then acquired regional GSM carriers Aerial Communications in the Midwest and Omnipoint in the Northeast). In May 2001, VoiceStream and Southern regional carrier Powertel were acquired by Deutsche Telekom for $24bn, and changed to the T-Mobile brand name in September 2002.

T-Mobile USA has its headquarters in Factoria, Bellevue, Washington and is currently the fourth largest mobile wireless carrier in the US market with 23.3 million customers (Q2 2006). T-Mobile USA is preparing for continued strong growth in the American mobile communications market where the current penetration rate of around 73% is considerably lower than in Western European markets. Voice traffic in the US market is expected to continue to grow two or three-fold until 2015.

The mobile data business in the US is also expected to grow considerably and has a long way to go. Mobile data already accounts for around 11% of T-Mobile’s average revenue per user (2Q 2006). The company is well placed to satisfy its Telecom 2010 programme which aims to make the US division the largest single company in the group by 2010.

" T-Mobile USA has more than doubled its average frequency coverage in the top 100 US markets, from 25.9MHz to 52.2MHz."

NETWORK ROLLOUT

T-Mobile has awarded partial contracts to both Nokia and Ericsson to build the 3G network in the US. The company has announced that it will start to rollout the new UMTS-based 3G service in the final quarter of 2006 and most of the work will be completed in 2007 and 2008. T-Mobile USA has budgeted around €2.1bn for this work from 2006 to 2009. The increase in investment by T-Mobile USA in its network infrastructure will be lower, however, because some investments in the existing network can be reduced as the rollout of the new network progresses.

The focus of the 3G rollout will be in the larger population centres and not in the rural areas. Ericsson was selected for its turnkey network rollout and to serve as the prime radio provider for WCDMA (wideband code division multiple access) 3G services in certain markets, including New York City which is scheduled to be operational in 2007. In addition, Ericsson is contracted to deliver a wide array of services including network planning, civil construction, installation, testing and network optimisation. Nokia as its part of the contract is delivering its Nokia Flexi WCDMA Base Station optimised for T-Mobile’s newly acquired AWS spectrum bands.

T-Mobile will be the first US operator to deploy the fully HSDPA capable Nokia Flexi WCDMA Base Station. The small and modular design of the Nokia Flexi WCDMA Base Station enables easy deployment of WCDMA 3G in multiple spectrum bands with significantly lower base station site expenditures and also gives an easy upgrade path to HSDPA for the future.

GSM 850

T-Mobile USA also completed the rollout of its GSM 850 network in 2006, which has boosted its current coverage area by nearly 40%. The biggest benefit of GSM 850 is that the frequency gives increased coverage for less base stations as the 850 signal propagates further than a 1900 signal. The advantages will be seen mainly throughout the central part of the United States. Although the final stages of the rollout also included rural areas of the Northeast and West. Altogether, nearly 400,000 square miles of new coverage has been added during 2005–2006.

WEB 2.0

US mobile telecommunications companies are leading the way to bring second generation internet services to the mobile phone platform. Web 2.0 refers to a series of possible second generation mobile internet-based services that emphasise online collaboration and sharing. Nokia and some of the US telecommunications companies such as Sprint Nextel, along T-Mobile USA, are leading the charge to turn the internet model to the commercial benefit of mobile comms. T-Mobile USA is building a nationwide UMTS system and it has said it will focus its 3G services firmly on Web 2.0 applications such as MySpace and YouTube, as well as data management scenarios and consumer mobile email.