MetroPCS Moves to Voice over LTE

Posted by Sam Churchill on

MetroPCS will take the first steps in migrating its circuit-switched voice service over to a voice-over-LTE (VoLTE) service next year. It will introduce its first carrier VoIP services in the first quarter of 2012, CEO Roger Linquist said yesterday during Metro’s earnings call. Using its new LTE network, MetroPCS has already begun with the migration of its SMS and MMS services to the same platform.

MetroPCS runs both a CDMA 1X network and LTE networks in 14 major markets. Its CDMA network covers 146 million POPs. While its LTE network still falls short of overlapping that CDMA network completely, MetroPCS plans to complete that overlay by early next year. MetroPCS offers monthly 4G LTE service plans between $40 – $60, which include talk, text and a 4G Web. Dallas-based MetroPCS provides no annual contract, unlimited wireless communications service for a flat-rate. As of June 30, 2011, MetroPCS had approximately 9.1 million subscribers.

MetroPCS deployed their LTE network last fall, primarily using its existing AWS (1.7/2.1 GHz) and PCS (1.9 GHz) spectrum. That required to MetroPCS to split capacity between CDMA and LTE, resulting slower LTE speeds. The average download speed reported was around 700 kbps with approximately 200 milliseconds of latency. MetroPCS has 1.4 MHz, 3 MHz and 5 MHz downlink carriers, though most of its markets utilize a full 5 MHz-by-5 MHz carrier where new AWS spectrum is available (pdf). By contrast, Verizon Wireless has 10 x 10 MHz network in the 700 MHz band. MetroPCS spectrum in the PCS and AWS bands totals an average of 22 MHz in its markets.

MetroPCS CEO Roger Linquist says their options for more spectrum include acquisitions from the AWS band or from Dish Networks, leasing spectrum from Clearwire or LightSquared, or getting in on spectrum that will likely have to be divested if AT&T’s acquisition of T-Mobile USA is approved.

VoLTE lets MetroPCS move its voice traffic gradually to LTE, allowing it to shut down CDMA carriers, shifting them to accomodate more LTE capacity. MetroPCS is also supportive of LightSquared’s wholesale LTE business model (if that ever gets off the ground).

Both MetroPCS got shellacked yesterday on their second quarter earnings report which whacked 37% off the stock on its no-frills service that focuses on lower-income end of the mobile market.

The typical MetroPCS customer spends $40 per month, whereas the average Verizon pre-paid customer generates $54 in revenue. But since it costs MetroPCS under $20 a month to offer service, it leaves plenty of gross margin. But building new data networks costs money, and the $265 million the company invested in capital expenditures in the last quarter was well ahead of Wall Street forecasts.

Sprint has announced that it will become the first U.S. carrier to sell 4G to wholesale customers. Wholesale customers include smaller carriers like Cellular South and MetroPCS. Available immediately for Sprint’s Wholesale customers are the Sierra Wireless 250U 3G/4G data card and HTC Detail 3G/4G handset, which has the same feature set as HTC EVO Shift 4G, a WiMAX phone.

Dual-mode WiMAX/LTE handsets, perhaps using Sequans chips and LTE on Clear spectrum, is widely expected next year on the Sprint network. Sequans supplied the WiMAX chips for Sprint’s original HTC EVO 4G and HTC EVO Shift 4G smartphones. Their dual-mode 4G WiMAX/LTE chips provide a smooth tranlation from WiMAX to LTE. Packet One, for example, launched a WiMAX operation in Malaysia in 2008 and is now in the process of transitioning to LTE using Sequans chips.

The Samsung Epic 4G uses Samsung’s own CMC730 chips for WiMAX and a Qualcomm QSC6085 CDMA2000 baseband baseband processor. The Sprint Galaxy S2 from Samsung may also use Samsung’s WiMax chips and LTE devices.

In other news, Skype has finally released an iPad app. The free app allows you to make voice or video calls or send instant messages to other Skype users for free over a 3G or WiFi connection. You can also make cheap calls to telephone numbers if you have SkypeOut credit.

Posted by Sam Churchill on Wednesday, August 3rd, 2011 at 6:44 am .

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