Verizon's LTE, Wi-Fi calling conundrum could leave it in the dust to Project Fi, others

It seems as though Verizon (NYSE: VZ) is in a bit of a pickle. On the one hand, it boasts having a great LTE network that provides for great voice calls. On the other, some of its customers who are not getting good LTE coverage would like the opportunity to use Wi-Fi for calls, but at least one company executive has indicated it doesn't need to offer Wi-Fi calling because its LTE network is so great.

At an investor conference last year, Verizon Communications CFO Fran Shammo said Verizon needed to do some technological work in its network to make Wi-Fi calling available, and that it should come around by the middle of this year. We're now in the fourth quarter, and no Wi-Fi calling support. He also said Wi-Fi calling was never a top priority for Verizon, and when calls are on a Wi-Fi network, it's difficult for Verizon to guarantee the quality of service on that call, which is what Verizon has built its brand reputation on.

If Verizon does offer Wi-Fi calling -- which its competitors are doing, whether they need a waiver from the FCC or not -- then it looks like it's admitting that its LTE network isn't as great as advertised. But if it doesn't offer Wi-Fi calling, it looks like a stick in the mud, refusing to give customers something that they want, particularly if they are in dead zones where network extenders don't get the job done.

Asked about Verizon's plans for Wi-Fi calling, a spokeswoman said: "Wi-Fi calling is an important technology we continue to explore. At the same time, our 4G LTE network is the largest and most reliable in the U.S. We'll let you know when there is any news to share."

Verizon has a reputation for having a great network, and one wouldn't blame the carrier if it didn't want to offer Wi-Fi calling if the quality of service isn't up to snuff. Getting Wi-Fi calling to work "seamlessly" and without broken handoffs or dropped calls isn't a quick and easy thing to do.

AT&T just received a temporary waiver from the FCC that allowed it to launch Wi-Fi calling for newer iPhones. Until the waiver was granted, AT&T said it was at a competitive disadvantage because T-Mobile US (NYSE:TMUS) and Sprint (NYSE: S) have been offering Wi-Fi calling for quite some time without having sought a waiver of the commission's TTY rules.

T-Mobile, in particular, has been working on Wi-Fi calling since 2007, and Republic Wireless, a smaller company based in Raleigh, N.C., has been working on it in earnest for the past several years. Republic, which holds dozens of patents, uses what it calls Republic Labs to involve customers in the development of products and features, giving it a chance to perfect the technology in beta projects. All of which to say is: A lot of people are trying to figure out how to make Wi-Fi calling better and more akin to cellular, which, by the way, wasn't 100 percent perfect in every way when it first launched. 

It's not clear to me why Verizon hasn't launched Wi-Fi calling. It could have to do with the FCC's rules on TTY, though I doubt it. It might be a strategy whereby it will wait until the very last minute before it makes the service widely available for business/revenue reasons. It could have to do with lack of support in a wide variety of handsets -- it takes a lot of commitment on the part of the handset makers to be willing to test, validate and make it work as well as cellular. It could be that it needs to go through further paces in network testing, or it could be a combination of things.

Meanwhile, the Wi-Fi calling world marches on. Google (NASDAQ: GOOG) has been experimenting with its invite-only mobile service called Project Fi, which toggles between licensed and unlicensed spectrum using a network of Wi-Fi hotspots. It's supposed to use the network with the fastest signal, whether it's LTE or Wi-Fi. Microsoft (NASDAQ: MSFT) is in a long-term agreement with iPass that gives Microsoft customers access to millions of Wi-Fi hotspots worldwide while traveling, including airplanes, airports, hotels and other public areas.

Cable companies, including Cablevision (NYSE: CVC) with its Freewheel service, are intent on investing more in their Wi-Fi networks, seeing Wi-Fi as the technology of the future. They continue to add more Wi-Fi access points to their offerings, fueling the fear that one day, someone might be able to compete with cellular carriers with a broader Wi-Fi offering and better roaming than ever before. Stay tuned, as they say. --Monica