EDGE falling off vendors' radar

Most are waiting for commitments from carriers

While AT&T Wireless remains publicly committed to deploying EDGE technology by 2002, some vendors have put their EDGE plans on hold until they see widespread commitments from carriers.

“We've taken our resources off of EDGE and put it into other areas,” said a spokesman for Motorola's infrastructure division. “As operators decide to migrate that way, those resources will be reallocated.”

EDGE, or enhanced data rates for GSM evolution, was introduced as a way for TDMA and GSM carriers to deploy 3G high-speed data services within their existing spectrum allocations before the advent of wideband CDMA (WCDMA) technology. But worldwide interest in the technology has waned as TDMA and GSM carriers focus their efforts on developing 2.5G general packet radio services (GPRS) and invest in WCDMA, likely leapfrogging EDGE.

Major carriers that have publicly endorsed EDGE AT&T Wireless (U.S.) Bouygues Telecom (France) Cingular Wireless (U.S.) C&W Optus (Australia) Entel Movil (Brazil) Rogers Wireless (Canada) Telecom Personal (Argentina)

This has led analysts to declare EDGE dead.

“It's something else operators in Europe can't afford to spend money on,” said Phil Kendall, director of the global wireless practice for Strategy Analytics in the U.K. “EDGE will be an afterthought.”

The hedging has caused companies such as Motorola and wireless modem vendor Sierra Wireless to focus all their R&D money on GPRS and CDMA 1XRTT technology. Sources close to Lucent Technologies indicate the company is evaluating EDGE technology's viability as well.

“Vendors are all locked in a waiting game to see if any significant carriers will make any commitments. That is the situation we are in,” said Andrew Harries, senior vice president of corporate development for Sierra Wireless. Harries said his company has an agreement with AT&T Wireless that calls for Sierra Wireless to develop and supply EDGE modems under certain commercial terms.

Even vendors that remain dedicated to EDGE concede they are playing the waiting game, although Nokia believes EDGE has strong momentum because of the simple upgrade path from GPRS. “We are very committed to supporting EDGE with our customers,” said Keith Shank, vice president of business management for Ericsson.

Much of the hesitation carriers have about committing to EDGE lies in the uncertainty surrounding when commercial handsets will become available, vendors said. “We are waiting to understand with our customers where the market is, as well as the type of handsets that will become available before we make the jump,” Shank said. Nokia is the only handset vendor to announce it will make EDGE handsets by 2002, and prototypes aren't in the market yet. At the same time, handset manufacturers say they aren't seeing any volume commitments from carriers to make a solid stance on the technology.

“When vendors look at where to put their resources, do they put them in UMTS or an EDGE phone?” said Paul Dittner, handset analyst with Gartner Dataquest. “There's limited resources and budgets now that everyone's stock price is a fraction of what it was a year ago.”

Still, analysts and manufacturers say U.S. carriers will drive the technology because they are facing spectrum constraints and uncertainty about the availability of new spectrum. Incumbents currently tie up all the frequency bands the federal government is considering for 3G services.

“If carriers were allocated more spectrum, they would probably consider WCDMA as the primary technology and EDGE as a complementary solution in areas where there is not enough spectrum,” said Michel Biurrun, director of access products and systems for the GSM business in the Americas for Nortel Networks. Biurrun said Nortel continues to support EDGE technology but is waiting for commitments from carriers.

AT&T Wireless, which is busy deploying GSM/GPRS technology this year alongside its TDMA networks, said it has enough spectrum to skip EDGE and deploy WCDMA if it chooses. But the carrier indicated it is committed to deploying EDGE by next year because the technology will become available before WCDMA.

“We have commitments from infrastructure and handset vendors to support EDGE,” said Jim Grams, senior vice president of multimedia systems with AT&T Wireless. “There are contracts and purchases in place…. Our vendors put a lot of business at risk if they don't.” AT&T Wireless' GSM, EDGE and UMTS vendors include Nokia, Ericsson, Lucent and Nortel.

Cingular Wireless, which declined to comment for this story, hasn't announced its adoption of the technology formally but told Telephony in June it plans to launch EDGE by 2002. GSM operator VoiceStream also is a candidate for EDGE technology.

EDGE should be economical it is a software upgrade from GPRS yet economies of scale could be lacking if handset vendors don't include EDGE software in volumes of devices, Grams said. He said EDGE prototypes wouldn't become available for another six months.

“To be fair, there is danger if no one asks for EDGE software. Then vendors will be delayed,” Grams said. “But we've been assured by our vendors and we're doing it…. If they are doing it for AT&T, why wouldn't vendors just let that software be in all the devices that they ship?”

Economies of scale have been an issue for AT&T Wireless and Cingular on the TDMA handset side. One reason AT&T Wireless deployed GSM/GPRS was to leverage the economies of scale associated with the world's most widely used technology. Cingular is expected to deploy GSM/GPRS technology in its existing TDMA markets.

Grams believes more carriers will be attracted to EDGE once they see evidence of handsets and the capabilities of the high-speed network.

Chris Pearson, executive vice president of the Universal Wireless Communications Consortium an association that advocates EDGE said he expects carriers to order EDGE equipment by the end of the year.

“There will be announcements on hundreds of millions worth of contracts,” Pearson said.