Smartphones are double-edged swords for carriers. They attract big-spending customers, but tax networks designed for simpler times, explains Fortune.

Independent telecom analyst Chetan Sharma estimates that the typical wireless subscriber consumes 120 megabytes each month; typical iPhone owners use four times that.

And it’s just getting worse. By 2010, global mobile data traffic is expected to exceed 200 terabytes per month, six times last year’s levels, according to Cisco Systems.

“3G networks were not designed effectively for this kind of usage,” says John Donovan, AT&T’s chief technology officer, referring to the current generation of broadband wireless. “We fight the day-to-day guerrilla warfare as the customers move around.”

Many of AT&T’s 60,000 cell towers need to be upgraded, with new 850 MHz gear and backhaul. That could cost billions of dollars, and AT&T has kept a lid on capital spending during the recession. AT&T will delay their LTE upgrade, upgrading its HSPA 3G network from 3.6 Mbps to 7.2 Mbps, instead.

Verizon plans to have 30 US LTE Markets by 2010. Verizon will use their nation-wide 700 MHz band. The carrier hopes to have a data-only LTE trial service available in Seattle and Boston later this year.

It can’t come soon enough. The tsunami is about to hit. Android phones from Samsung, LG, and Motorola are due in stores by early 2010. Motorola will launch their Android portfolio on September 10th. The data-oriented Palm Pre, which operates on Palm’s WebOS platform, is already on Sprint and should be in Verizon stores early next year.

A Cisco Mobile Forecast for 2008-2013 noted that a single high-end data phone today generates more data traffic than 30 basic-feature cell phones, while a single laptop air card generates more data traffic than 450 basic-feature cell phones. Cisco projects that mobile data traffic will increase a thousand-fold over the seven years from 2005 through 2012, with video being a significant component.

AT&T offers free Starbucks WiFi (with a paid data subscription) while Verizon is partnering with Boingo to deliver free WiFi access at hotels, airports, restaurants and coffee shops (with a data plan). PCCW, the Hong Kong operator, has started using Wi-Fi hot spots to ease the load from smartphones and its digital TV service.

AT&T CEO Randall Stephenson has said that the most active 5% or so of data users are causing problems for the other 95%. AT&T is working on a revamped data plan whereby light data users would pay less, and heavy users would pay a premium rate — or leave.

Related Dailywireless articles include; AT&T Makes Jump to HSDPA Speed, AT&T: HSPA+ Not LTE for Now, LTE Marketing Ramps Up, Sweden Tests LTE, Verizon LTE: 30 US Markets by 2010, Verizon Updates 700MHz LTE Specs, WHERE on T-Mobile’s Web2go, AT&T Adding 25,000 Hotspots Overseas, Future Bleak for WiMAX?, Movies on Demand for Motorola and iPhone, ABI: Cellular Data Too Expensive, The Death Of Paid WiFi, The App Store: Year One Revolution, The iPhone: A 2nd Economy?, Verizon: Free WiFi with DSL/FiOS, Mobile Supercomputing, Sweden Tests LTE, Sweden Tests LTE, Verizon LTE: 30 US Markets by 2010, Verizon Calls on LTE, AWS: It’s Done, 700MHz: It’s Done!,

Posted by Sam Churchill on Friday, August 28th, 2009 at 7:02 am.