February 10, 2010, 12:36 PM — AT&T today announced equipment suppliers for its coming high-speed wireless LTE network and signaled the start of an aggressive battle against rival Verizon Wireless.
AT&T named Alcatel-Lucent and Ericsson as its multiyear LTE suppliers with contracts that are estimated by analysts to be worth hundreds of millions of dollars. None of the parties discussed exact terms.
Several major suppliers had hoped for the contract, including Motorola Inc., which could not be reached for comment today.
In picking the two LTE suppliers, AT&T "chose to extend existing relationships" because both had provided equipment that's being installed for 3G upgrades to HSPA 7.2. HPSA 7.2 has theoretical speeds of 7.2 Mbit/sec. that is used by the iPhone 3GS and nine other devices as well as the upcoming iPad on 3G . The upgrade is seen as a strategic network advantage by AT&T over Verizon in coming months.
AT&T explained the value of working with its current suppliers this way: "Continued work with these two suppliers will enable AT&T not only to incorporate high-performance LTE equipment, but also take full advantage of the compatibility between the suppliers' existing 3G equipment and forthcoming upgrades," AT&T said in a statement.
"As part of the supplier agreements, 3G equipment delivered to AT&T by the suppliers starting this year will be easilyv conertible to LTE, enabling AT&T to upgrade existing equipment and software rather than install entirely new equipment in many cases as it deploys the next generation technology."
In an e-mail, an AT&T spokeswoman added that picking Alcatel-Lucent and Ericsson "is an important step in our ongoing mobile broadband strategy. Unlike our competitors, our strategy will enable us to deliver even faster speeds to a large number of people before 4G [LTE] networks and device lineups scale."
In a statement, John Stankey, CEO of AT&T Operations, asserted an added benefit that AT&T has over Verizon's version of LTE. "AT&T has a key advantage in that LTE is an evolution of the existing family of GSM technologies that powers our network and the vast majority of the world's global wireless infrastructure." By contrast, Verizon has been a CDMA provider, although Verizon has a clear upgrade pathway to LTE that is underway.