Verizon and Sprint have taken the lead on domestic LTE roaming - it's time for AT&T and T-Mobile to catch up

Phil Goldstein

Now that all four Tier 1 carriers can credibly claim to be nearing nationwide LTE coverage, we're starting to see LTE roaming agreements becoming an actual part of the conversation. However, the agreements aren't between the Tier 1 carriers but between the large carriers and many smaller rural and regional operators.

Yet if customers of the carriers in the rural and hard-to-reach places of the country are going to see the benefits of national LTE networks, the Tier 1s need to be doing a lot more to facilitate LTE roaming, in terms of both network technology and devices.

Verizon Wireless (NYSE: VZ) and Sprint NYSE: S) are clearly taking the lead in this area. Verizon's LTE in Rural America (LRA) program has been a pioneering example since the carrier launched it in 2010 to expand LTE service in rural parts of the country via its partners; Verizon's first partner carriers launched service in 2012. Verizon now counts 21 partners, 18 of which have launched LTE service, according to Philip Junker, Verizon's executive vice president of business development and the head of the LRA program.

LRA members lease Verizon's 700 MHz Upper C Block spectrum. They then build out their own networks and sell service to their own customers, but have access to Verizon's network vendors and LTE device portfolio. Crucially, the smaller carriers' subscribers can roam onto Verizon's nationwide LTE network and the networks of other LRA partners. The program allows Verizon to quickly and cheaply build out rural areas and get access to rural carriers' networks.

Junker said that Verizon's LRA partners have launched 650 LTE cell sites, which will grow to 1,000 by the end of 2015. Right now the sites on air cover an area of more than 70,000 square miles, about a third of the total area covered by the spectrum that has been leased. More than 220,000 customers across the 18 partners that have launched are now being served with LTE, and the partners cover 2.3 million POPs in total.

One of those partners is Bluegrass Cellular, which first launched service in November 2012. Based in Kentucky, the company now has more than 80 percent of its LTE network using Verizon's spectrum complete, and it aims to get to 100 percent by the end of 2015.

Barry Nothstine, vice president of sales and marketing of Bluegrass, said the LRA program has been "great" for the company, and he praised the work Verizon has done to give Bluegrass access to its LTE vendor partners and its device lineup.

Yet for smaller carriers in general, he said, getting access to interoperable devices is a critical element of LTE roaming, and is just as important as finding the right strategic partner and getting the right price on overall roaming rates.

"Our customers expect the same products and services as the big guys, and it's important that we have that," he said. "They're accustomed to that from us from a network perspective."

Meanwhile, Sprint is seeking to expand its own LTE footprint via agreements with rural carriers under a similar program. In June, Sprint announced agreements with 12 carriers covering around 34 million POPs in 23 states for its Rural Roaming Preferred Program. All of the agreements include reciprocal LTE roaming and Sprint is working with its rural partners to get them access to LTE devices and network infrastructure for the 2.5 GHz band, a key element of Sprint's tri-band LTE Spark service. In some cases, Sprint is leasing its spectrum to its rural partners, Sprint spokeswoman Kelly Schlageter confirmed.

Phoenix Wireless, a small carrier founded in 2013 and based in Maine, has partnered with both Verizon and Sprint, and plans to deploy LTE service that supports both carriers' networks. Phoenix CEO Bob Parsloe said over the next 18 months the company will use Verizon's spectrum to cover rural Washington and Hancock counties in eastern Maine, and then will use Sprint's spectrum to cover those same areas as well as parts of upstate New York in the Adirondack mountains. He said the company is "looking at other markets that have similar needs."

Phoenix plans to launch fixed wireless service at first, and then nine to 12 months into its deployment it will start selling mobile devices when it has a better handle on network demand, Parsloe said.

Parsloe said Phoenix chose to partner with both Verizon and Sprint to boost its roaming revenue from carriers launching similar technologies. He noted that Phoenix's base stations will support multiple spectrum bands. "If you want a sustainable business going forward, you have to look at aggregating as many of those revenue opportunities as you can in the ultra-rural markets where population density is so low," he said.  Parsloe said he hopes other Tier 1 carriers follow Verizon and Sprint's lead.

As for the other two Tier 1 carriers, T-Mobile US (NYSE:TMUS) said in a statement it currently has LTE roaming agreements with partners it did not name, "and is actively working with partners to enable LTE roaming." The company said it is "actively working with competitive carriers to launch LTE roaming services and is fully supportive of band compatibility for devices." In terms of the challenge facing carriers in LTE roaming, T-Mobile acknowledged that it has "seen some technology differences that need to be worked through. Examples include billing system requirements and pricing expectations."

AT&T Mobility (NYSE: T) spokesman Mark Siegel said the company is "not going to speculate at this point" on possible LTE roaming partnerships with rural carriers.

Getting smaller carriers the devices that have the necessary chipsets and radios to work on nationwide LTE networks is critical, and something I've heard time and again from rural carriers. AT&T helped smooth this process along when it said last year it would support 700 MHz interoperability by adding A Block, Band 12-capable devices to its portfolio. That should help lower the cost of A Block devices used by smaller carriers by increasing the number of carriers using the band. Yet rural carriers continue to see device interoperability as a key stumbling block to LTE roaming, and anything carriers can do lower costs for interoperable LTE devices that smaller carriers can use would be a welcome development.

It seems unlikely that Tier 1 carriers are going to strike LTE roaming deals between themselves any time soon. Indeed, data roaming in general remains a contentious issue, so much so that T-Mobile is asking the FCC to issue "benchmarks" on the cost of roaming rates in an effort to make it easier for smaller carriers to ink cheaper roaming deals with bigger carriers. However, AT&T has said T-Mobile's petition would "eviscerate" the FCC's data roaming rules.

So for now the action is between Tier 1 carriers and smaller players. Tier 1 operators will need to make sure they are at least encouraging--if not financially supporting--technology alignment with their smaller partners for network equipment and devices. Without that, LTE roaming will go nowhere.

Verizon and Sprint are taking great strides to enable LTE roaming. I wish AT&T and T-Mobile would more aggressively follow their path. --Phil

P.S. If you're interested in this topic, I'll be moderating a breakfast panel at CCA's annual convention on Sept. 8 at 7:45 a.m. at The Cosmopolitan of Las Vegas. Our panelists include Todd Rowley, vice president of business development at Sprint; Heather Stacey, director of business development at T-Mobile; Bryan Burns, head of mobility products at Transaction Network Services; Rob Riordan, EVP and director of corporate development at Cellcom; and Sandip Sarkar, senior director of technology at Qualcomm Technologies. You can register for the breakfast through CCA's show registration, or you can add the breakfast to your existing CCA registration. I hope to see you there!

Headline updated Aug. 21 to note that the column discusses domestic LTE roaming in the U.S., and not international LTE roaming.

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