MetroPCS Joins FiberTower for LTE – Analyst Blog

Leading unlimited wireless carrier MetroPCS (PCS) has reportedly forged an agreement with backhaul and access services provider FiberTower Corp (FTWR). Under the pact, FiberTower will offer Ethernet-based backhaul services in select MetroPCS markets, which will provide the much-needed support for the carrier’s forthcoming launch of 4G Long-Term Evolution (LTE) wireless broadband services. 

 

Wireless Ethernet backhaul services are tailored to fit the requirements of wireless operators, addressing their needs for higher bandwidth for 3G as well as more advanced 4G services. Backhaul services enable the carriers to boost capacity to cell sites to meet the requirements for bandwidth-intensive multimedia devices (including smartphones) and applications.

 

By leveraging FiberTower’s Ethernet backhaul solution, MetroPCS will have the ability to effectively scale network capacity from 5 megabits pe    r second (Mbps) to as much as 1 gigabits per second (Gbps) per cell site according to the carrier’s backhaul needs to support the increased network traffic once the 4G LTE network is deployed.

 

MetroPCS plans to launch 4G LTE service and dual-mode smartphones (designed to run on LTE and CDMA networks) in its metropolitan markets including New York and Los Angeles in the second half of 2010. The carrier has selected Swedish telecom equipment provider Ericsson (ERIC) as the infrastructure vendor and Samsung Telecommunications America as the supplier of its LTE-enabled handsets.

 

Leading carriers across the globe have adopted LTE as the base technology standard for 4G due to its fast data transfer capability and ability to handle bandwidth-intensive applications. LTE offers blazing-fast downlink and uplink speeds of 100 Mbps and 50 Mbps, respectively, which are faster than other leading 4G standards including WiMax.

 

Tier-1 US carriers Verizon (VZ) and AT&T (T) have also embraced LTE for their 4G network upgrade initiatives. Verizon recently revealed its plans to begin offering commercial LTE services during the fourth quarter of 2010 while AT&T is expected to roll out 4G LTE services in 2011.

 

Despite its leadership in the unlimited prepaid segment, MetroPCS is currently struggling with high churn (customer switch). Besides competing head-to-head with its archrival Leap Wireless (LEAP), the carrier has been increasingly challenged by the aggressive roll-out of competitive discounted service plans by some of its larger peers such as Sprint Nextel’s (S) Boost Mobile and America Movil’s (AMX) Tracfone.

 

MetroPCS is one of the key beneficiaries of the ongoing fixed-to-mobile transition trend. By moving to 4G LTE, the company will encourage customers to discontinue wireline broadband by offering super-fast mobile broadband experience on their handsets, representing an encouraging opportunity to improve customer retention. Moreover, the ultra-high bandwidth multimedia data applications fostered by the 4G LTE network will boost revenue per user through increased minutes of use.