Finally, T-Mobile Launches a U.S. 3G Network

T-Mobile USA, the company known for its ultra-affordable voice plans, is launching its 3G Network in New York City, ushering in what we hope will be competition in the market leading to the lowering of 3G data costs for mobile phone users.

For now, the new UMTS/HSDPA network is available only in New York, but there are plans to roll out the network in other cities later this year. The company is being vague about in which cities it will launch the network. There are four handsets that can be used with this network: Nokia 3555, Nokia 6263, Samsung t819 and Samsung t639.

T-Mobile claims that AWS spectrum effectively doubles their spectrum and makes it easy for them to manage future growth. The network operates over 1.7 and 2.1 GHz bands. T-Mobile had spent a total of $4.2 billion in the AWS spectrum, and there are rumors that the company might look at buying even more AWS spectrum from Nextwave. We had reported earlier that Ericsson and Nokia were equipment suppliers for the network that was originally supposed to launch in 2007.

T-Mobile isn’t the first company to launch a network based on AWS. That honor goes to Stelera Wireless, an Oklahoma City-based rural broadband service provider that launched a much faster network in two Texas cities.

What this news means?

  • Over the long term, this is a great development because it gives us another 3G option. The current players: AT&T, Verizon and Sprint have not gotten into price competition because the demand for mobile broadband has been strong. T-Mobile, being the late-comer is going to have to offer much cheaper packages in order to steal market share away from the big three. I think that would force the other three to respond. The same dynamics had played out in the voice market as well, so lets hope for an encore. Of course, all this is predicated on T-Mobile’s ability to roll out a nationwide network.
  • In the short term, the paucity of handset choices and limited network availability mean that it will be a while before people are going to seriously consider T-Mobile 3G as an option.