USA! We’re Number 1!

Rah! Rah! Rah! That’s right: We Americans rock. Why? Because — unlike in previous Gs — we’ve got 4G first, and we’re using it to kick butt and take names, at least as far as the wireless vendors are concerned.

Before my rant degrades any further into jingoism, I should explain. For the first time in more than a decade, the U.S. is leading the way in the implementation of a new generation of wireless technology. And that has made the U.S. the focus of every vendor’s 4G efforts globally. The U.S., and North America in general, has always been important to global wireless vendors, but its split technology loyalties and general tardiness in deploying new networks have served to keep vendors occupied in other regions of the world when a new standard emerges.

Now the tables have turned. The number of long-term evolution (LTE) commitments in North America is staggering, as are the aggressive deployment schedules of carriers such as Verizon Wireless (NYSE:VZ, NYSE:VOD) and MetroPCS (NYSE:PCS). AT&T (NYSE:T), Bell Canada (NYSE:BCE), Telus (NYSE:TU), CenturyTel (NYSE:CTL), Cox Communications and TerreStar (NASDAQ:TSTR) all either have definitive plans to launch commercial LTE networks or trial the technology. And though the LTE community would like us to, we can’t forget about WiMAX. Clearwire’s large-scale deployment of the alternate 4G technology is what kicked off this domestic mobile broadband race in the first place. WiMAX not only gives Clearwire (NASDAQ:CLWR) its 4G strategy, but also Sprint (NYSE:S), Google (NASDAQ:GOOG), Time Warner Cable (NYSE:TWC) and Comcast (NASDAQ:CMCSA)
Consequently, instead of focusing their initial sales efforts on Europe and East Asia, wireless vendors are making North America their first point of attack. If the number of LTE innovation labs the vendors keep opening on American soil isn’t enough to convince you of their Yankee fever, then their words should. Ulf Ewaldsson, vice president and head or radio networks for Ericsson (NYSE:ERIC), said that the main reason the Swedish vendor bought Nortel’s wireless assets at auction was not to get into the CDMA business or access its LTE technology, but to establish an enormous presence in the North American market, where all of the activity lies. In recent interviews, Simon Beresford-Wylie, Nokia Siemens Networks’ outgoing CEO, said not pushing further into North America was one of his few regrets during his tenure, and incoming CEO Rajeev Suri said one of his main aims at NSN is to increase that North American presence. NSN also bid on Nortel’s wireless assets, primarily with an eye for Nortel’s customer base, but Beresford-Wylie said Ericsson’s $1.13 billion bid was too much to ask. (The Beresford-Wylie and Suri interviews will appear in a story on TelephonyOnline.com shortly. Stay tuned.)

So why the intense focus on these first American contracts? The reasons are both offensive and defensive. Regardless of whether the U.S. is first or last to 4G, a contract spanning the U.S. is one of the crown jewels in telecom, bringing in billions of upfront revenue and further billions in expansion and upgrades. Just as important is the momentum a vendor accrues for winning one of the initial contracts in LTE. Winning the Verizon radio deal immediately established Alcatel-Lucent (NYSE:ALU) and Ericsson as the front-runners in LTE — whether they deserve that recognition or not. The only other contract that could match it in terms of establishing momentum would be NTT DoCoMo’s LTE deployment in Japan. AT&T is set to name its LTE vendors soon. Expect the competition to be ruthless.

But the vendors also have to watch their backs. It’s not just the Ericssons competing against the NSNs competing against the Alcatel-Lucents. Next-generation vendors like China’s Huawei are hungry to establish themselves not just as challengers, but dominant global incumbents, and a disruptive technology like LTE is an optimal way to do it. LTE means a new network, which could mean a completely new set of vendors for any aggressive operator. Verizon had no qualms in selecting Ericsson to build its LTE network, though it had no relationship with the vendor in the past. Samsung used WiMAX as an entry point into the U.S. radio access market after failing to find an opening with CDMA. Huawei has been making inroads in North America with a CDMA or high-speed packet access contract here and a WiMAX contract there, but its sights are set on a major LTE win.

If you work for an operator and want to get invited to a lot of cocktail parties or exclusive dinners, my advice to you is to hint at having some connection to your company’s capex budget for technology planning. You probably won’t even have to hint.

E-mail me at kevin.fitchard@penton.com.