LTE in the United States is still in its infancy, but analysts are upbeat about the LTE deployments by Verizon Wireless (NYSE:VZ) and MetroPCS (NASDAQ:PCS).
In a research note, analysts at Oppenheimer wrote that Verizon's LTE service "is working better than anticipated and should have a major impact on the sector. ... This should help Verizon gain wireless market share next year, and, in our opinion, most likely will also help MetroPCS, which is also aggressively rolling out a new 4G network."
Verizon has launched LTE service in 38 markets, covering 110 million POPs, and has said the network gives users 5-12 Mbps downlink speeds. Verizon has USB modems for its LTE network and offers 5 GB of LTE data for $50 per month or 10 GB of data for $80 per month on either a two-year contract or a no-contract basis; both options carry a $10 per GB overage charge.
MetroPCS now offers LTE in nine markets; the flat-rate carrier plans to add more markets through early next year. MetroPCS' only LTE device, the Samsung Craft handset, is available for $299 after a $50 instant rebate. The prepaid service starts at $55 per month, and includes voice, text and LTE data service.
The actual success of the offerings so far is difficult to gauge; the companies likely will not give any details about their LTE subscriber additions until they report their fourth-quarter earnings, at the earliest.
Interestingly, the Oppenheimer analysts wrote that Verizon could use its LTE smartphones, the first of which is scheduled to be available in February, to target Apple's (NASDAQ:AAPL) iPhone. "We expect LTE smartphones to be introduced in 1H11, and for the company to heavily target markets where the iPhone is currently the dominant smartphone. We believe by targeting these markets, with the speed advantage and attractive price points, VZW has potential to capture significant market share," they wrote. Verizon is widely expected to launch the iPhone early next year.
The analysts also wrote that LTE likely will be a boon for tower companies, especially as other carriers try to catch up to Verizon's deployment. AT&T Mobility (NYSE:T) will launch commercial LTE service by mid-2011, and will cover between 70 million and 75 million POPs by the end of next year.
- see this WSJ blog post (sub. req.)
MetroPCS rolls out LTE in NYC, Boston and Sacramento
Verizon's Seidenberg: LTE smartphone pricing is still undecided
Verizon will offer no-contract LTE price plans
Verizon's LTE launch: What happened to innovative data pricing?
Verizon will debut 4G LTE service Dec. 5 with tiered pricing