NextG - Let down by handsets

It seems the big news in mobiles continues to be the never-ending media reports of the Telstra CDMA to NextG switch-over. The NextG network is among the most advanced mobile-broadband networks in the world, utilising HSDPA technology and Telstra even seems to have got the point of mobile broadband and is way out ahead in its content services (more about that another time).

The 850mhz spectrum which the network utilises however comes with the thorny problems of the company being able to source the right handsets at the right price. An article from the Australian's Cath Hart 'Bush telecoms must be improved' 25/03/08, quotes Dr Bill Glasson, currently heading a review into regional telecommunications services saying "One thing that's still hot out there is the CDMA/Next G transition. There's a lot of unhappy people out there with the Next G phones and a lot of that has got to do with the handsets,".

The problem stems from the fact that very few telcos around the world use the 850mhz spectrum, meaning manufacturers have far fewer phones available and production scales are significantly smaller. This translates into less choice for consumers and higher handset costs for telco's (I won't say this means more expensive handsets for consumers as telcos will pass these costs on or absorb them in any number of ways).

For Telstra its likely to mean it will suffer the same problems as Hutchison did in the late 90's in getting handsets out that are both reliable and cheap.

I want to make clear that I am a big supporter of the NextG network and expect it to be successful. Its not all doom and gloom though and Telstra is not alone. The GSM Association's Horizon Phone project www.gsmworld.com/horizonseries/ is a clear indication that this is becoming a considerable industry issue as more and more spectrum is re-farmed and as other countries move towards 850mhz as the path to mobile broadband over large georgraphic areas. Its also entirely possible that Qualcomm which dominates the CDMA chipset market will produce a chipset which can operate on a lot more spectrum bands, solving everybody's problems.