How soon will wireless operators run out of capacity?

SAN FRANCISCO--Will the nation's wireless operators run out of spectrum within the next two years? LightSquared Chairman and CEO Sanjiv Ahuja told the audience at the Open Mobile Summit here that at current growth rates U.S. wireless providers are on track to run out of network capacity and spectrum in the next two to three years.

However, during a later panel session, executives from both Verizon Wireless (NYSE:VZ) and Sprint Nextel (NYSE:S) painted a slightly brighter picture. According to David Small, CTO of Verizon Wireless, his company has enough spectrum to accommodate customers until 2015. However, he added that the wireless industry must work to get "spectrum into the hands of people that will use it," noting that currently the majority of wireless traffic is piped over just 54 percent of the existing spectrum. "There's an imbalance," Small said.

Likewise, Sprint Nextel CTO Stephen Bye said his company has enough spectrum to handle bandwidth demands through 2014. Bye also emphasized the need for not just more available spectrum, but spectrum that is harmonized. "All spectrum is not created equal," he said. "Simply adding spectrum in the random vein just adds costs. There needs to be more harmonization of spectrum to bring costs down."

Small also said that Verizon fights traffic bottlenecks in the network every day, but that the company has invested in about a dozen different technologies, such as video optimization, that helps manage the network capacity and provide customers with a good experience.  

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