CTIA: More spectrum, and other ways to break the wireless data bottleneck

The theme of the keynotes that kicked off the CTIA Wireless this week can be summed up in two words: more spectrum. There's no "silver bullet," and there are lots of other things the wireless industry can do to improve networks. But what wireless operators in the U.S. really want is more spectrum in order to keep their heads above a deluge of data traffic and continue to expand mobile broadband.

This isn't just an issue for smartphones, though the rapid growth in smartphones has created the problem. The growth of laptops and netbooks with integrated wireless broadband or USB modems also threatens to overwhelm networks, and 4G networks such as LTE and WiMax will initially be used largely for those types of devices. Then there's a whole new class of emerging devices such as Amazon's Kindle and the Apple iPad that use wireless broadband.

In his role as chairmen of the CTIA, AT&T's Ralph De la Vega steered clear of talking about his own company, and instead focused more on the state of mobile broadband. We've become used to hearing how the U.S. lags other countries in broadband, but when it comes to mobile broadband, the U.S. leads the world according to many measures. Despite having only 7 percent of the world's total wireless subscribers, the U.S. has 18 percent (117 million) of the world's total 3G subscribers, and 33 percent of the world's subscribers to the most advanced HSPA and EV-DO networks.

This year smartphone sales in the U.S. are predicted to be 53 million units--more than double the next-closest country, China, with an expected 25 million units. Those U.S. smartphone users downloaded more than a billion apps last year. The iPhone has driven this phenomenon, but De la Vega said new stores for Android, Palm, Microsoft and others would accelerate this. On top of this, new types of connected gadgets, including emerging devices such as e-book readers and machine-to-machine appliances (the so-called Internet of Things) will add to growing data traffic.

The average smartphone generates 10 times the amount of traffic of a standard cell phone, De la Vega said. He noted that Cisco forecasted data traffic will grow at a compound rate of 108% from 90,000 terabytes per month in 2009 to 3.6 million terabytes per month by 2014.

"Everyone knows that data is growing by leaps and bounds, and that growth is not expected to abate by any reasonable forecast," he said. "It's not a question of demand skyrocketing--we already know that. It's a question of how we'll deal with that."

The best way to deal with it, De La Vega said, is to increase the spectrum available for wireless broadband. He lauded the FCC's proposal to free up 500MHz of spectrum, part of the agency's recently-announced National Broadband Plan, but he said it will take years for that to happen and it still won't be enough on its own to meet consumer demand.

In addition, wireless companies need to develop more efficient technology such as LTE, which he said is 2.5 times more efficient than HSPA when deployed in the right spectrum, and make use of complementary technologies such as WiFi and femtocells to offload traffic. The U.S. already has about twice as many public hotspots (70,000) as number two China with 36,000 hotspots. This should be invisible to users--devices should automatically choose the best available network in the background. Finally De La Vega said the industry needs to work together to make applications more efficient. For example, in AT&T's testing, the company has found an 8X difference in the amount of bandwidth used by different e-mail providers.

AT&T CEO Randall Stephenson and CTIA President Steve Largent also discussed the need for more spectrum and talked up the FCC's 500MHz goal. Stephenson repeated the often-cited figure that data traffic on AT&T's network has increased 5,000 percent over the past few year--largely due to the iPhone--compared with about 3,000 percent for the industry as a whole. He said AT&T's network now carries around half the total data traffic in the U.S. In addition to more spectrum, he argued that the wireless industry needed what has historically been a "light regulatory touch" in order to attract the capital to build costly 3G and 4G networks. Finally he said all parts of the industry--such as network operators, equipment manufacturers, device makers and software providers--must work together to address the traffic jam.

"Long-term success isn't based on any one innovation and it's not based on any one company. It is based on how the industry works together," Stephenson said. "We get his right and the U.S. leads the world in productivity and innovation. We get his wrong and we've squandered our lead."

You can watch video of the CTIA Wireless keynotes here.