Hesse: U.S. Back in the Lead With 4G
Sprint Nextel CEO Dan Hesse has a lot of reasons to be confident about the state of the U.S. mobile broadband market. Over the past year, Sprint’s WiMAX partner Clearwire expanded its network to cover 71 markets; Verizon Wireless launched its LTE network in 39 markets; T-Mobile USA has HSPA+ in 100 cities; and MetroPCS turned on LTE in 13 cities.
“The U.S. is back in the lead,” said Hesse, the 2011 chairman of CTIA, in an interview ahead of this week’s event. “We were when wireless was launched in this country about 30 years ago, but then Europe took the lead with 2G and Asia took the lead with 3G. Now, the U.S. is back taking the lead again in 4G.”
Hesse plans to talk about what he calls the “reascendency” of the U.S. wireless market during his keynote address this morning. The United States’ ascent from a technological laggard to a technological leader on the networks front has been propelled by the soaring growth of apps, smartphones, tablets and machine-to-machine applications.
Like many other executives in the wireless industry, Hesse believes these data hungry devices will keep the wireless industry humming long after every U.S. consumer owns a cell phone, forcing wireless operators to find new ways to grow aside from adding new customers.
“[These devices] provide a lot of growth opportunities for the industry – even though penetration rates are getting up towards 100 percent, who said 100 percent was the limit?” Hesse says. “A lot of people are going to have three or four mobile devices.”
It’s not clear whether Hesse will address AT&T’s proposed acquisition of T-Mobile USA during his speech. In a statement issued about the deal, Sprint suggested it could prove anti-competitive, saying it would “alter dramatically the structure of the communications industry.” Sprint had been long-rumored to be pursuing a deal with T-Mobile USA.
Even without T-Mobile in its quiver, Sprint has already done a lot to get next-generation mobile broadband out to its subscribers. Sprint and Clearwire first launched their mobile WiMAX service in January 2009. By the end of last year, the network covered 71 markets and Clearwire had 3.3 million wholesale customers and 1.1 million retail customers. A cash crunch has forced Clearwire to scale back its network expansion plans and keep a Clear-branded smartphone on the back burner, but even so, the company still expects to double its subscriber base by the end of 2011.
In addition to its work with Clearwire, Sprint is in the midst of a $5 billion network modernization project that gives Sprint the flexibility to add LTE to its mobile broadband offerings. Despite Sprint’s flirtation with LTE, Hesse says the company doesn’t plan to dump WiMAX for the rival 4G technology. “Every single alternative includes WiMAX,” Hesse says. “What we’re looking at is possibly adding LTE in addition to WiMAX.”