T-Mobile USA, which detailed its next network upgrade yesterday, is betting that faster mobile broadband service today (well, before the end of this year) aimed at making smartphones perform better will justify its decision to move to a 3.5G network rather than the 4G LTE standard.
I chatted with T-Mobile USA CTO Cole Brodman yesterday after the nation’s fourth-largest carrier explained the rollout of its HSPA+ network upgrade that will deliver speeds of 21 Mbps down to all of its markets by the end of the year. T-Mobile also said that Philly, New York, and Washington, D.C. already have those speeds today. For more on the rollout check out my story from February. For more on the consumer experience, check out Kevin Tofel’s review of the network on existing T-Mobile gadgets or for those specifically designed for the upgraded network.
GigaOM: Let’s start with data consumption. What are people consuming on the T-Mobile network?
Brodman: The average Android customer consumes between 400 and 600 MB and we’re excited to see that because it means people are starting to use them for more than the occasional search for a ringtone.
GigaOM: So at these rates, do you believe that some type of usage-based billing is inevitable as AT&T and Verizon apparently do?
Brodman: The vast majority of consumers will consume at rates that carriers can stay ahead of and we want them to do that, but a small number of consumers will consume too much and it’s that small number that starts to endanger the economics for the average consumer. Around 2 percent of broadband stick users will even reach our cap (5GB on the high end) and they will far exceed it. What makes sense is as they start to endanger the affordability for everyone we need to look at things like usage-based pricing.
GigaOM: Don’t we already have some type of usage-based pricing with current plans that have different caps and overage charges?
Brodman: It’s hard to expect consumers to know what a megabyte is because what that can offer changes every day. And the problem is overage is not a good experience for consumers. I don’t have an answer for you today on what usage-based pricing will look like, whether it’s upgrade buckets, app-based pricing, quality of service-based pricing or time-sensitive throttling.
GigaOM: Right now, you are talking 3.5G when other carriers are talking about 4G and LTE. When might T-Mobile move to an LTE network?
Brodman: We’ve not announced a time for LTE. HPSA+ has a really rich future…one of our network partners delivered 80 Mbps on HSPA +. And we can transition smoothly to LTE when we have to and are excited about that growth into LTE when we need to.
GigaOM: T-Mobile has fewer spectrum resources than other carriers. Do you have the spectrum capacity to deploy LTE?
Brodman: We certainly believe access to additional spectrum for mobile broadband is important to America. If you step back from that, we have quite a bit of additional capacity in our portfolio and we’re freeing up spectrum used for our 2G network for 3G and HSPA+. But I think I’m not going to answer the question directly. We believe that our portfolio will keep us competitive in the near and medium term — for the next couple of years.
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