Adam Bender

A wireless partnership and broadband expansion could slow access line loss, CEO Ed Mueller told investors as the Bell released Q4 results Tuesday. In Q4, retail access lines declined 6.5 percent year-over-year to 11.5 million. That’s “arguably one of the worst rates of decline in the industry,” Bear Stearns analyst Mike McCormack said during a Q4 conference call. The Q4 loss is “more of the same” for Qwest, Mueller said. The slowing economy had “some impact,” but cable competition hasn’t increased, he said.

Qualcomm added LTE to its device and base station roadmap, announcing Thursday that three chipsets support the technology. Qualcomm expects to sample the chips in Q2 2009, it said. The chips are backward compatible with existing 3G UMTS and CDMA2000 networks, and two support UMB. No major U.S. carrier has announced plans to use UMB, but many in the industry see the Qualcomm-developed UMB as an LTE rival. Not so, a Qualcomm spokeswoman said. Qualcomm strives to be “technology agnostic,” supporting “as many technologies as possible,” she said. UMB is still on the Qualcomm roadmap, but the chipmaker also sees a “market need” for LTE, she said. Also Thursday, Qualcomm said international operators Hutchison 3G, Telecom Italia, Telefonica and Telstra will trial HSPA+ technology this year. HSPA+ is an upgrade to HSPA technology, increasing mobile broadband speeds up to 28 Mbps. Qualcomm expects to se HSPA+ to appear commercially in 2009, it said.

Level 3 has fixed many of its sales process problems and “generally returned” to quality levels extent before it integrated six network companies acquired the past two years, officials told investors as they reported Q4 results. Last quarter, Level 3 offered lower 2007 and 2008 expectations after struggling to integrate provisioning processes among the acquisitions (CD Oct 24 p11). “We now believe we've created additional installation capacity and we're working hard to increase the rate of sales to use this capacity,” said CEO James Crowe. “What we need to do is under our own control.”

Multi-billion-dollar share repurchase programs announced by Verizon and AT&T won’t hold back wireless network expansions, but could reflect an economic recession, analysts said in interviews. Verizon said Thursday it would buy back 100 million shares of common stock, worth $36.95 after the market closed. In December, AT&T said it would buy back 400 millions shares, worth $37 each. The Verizon buyback expires in 2011. AT&T’s finishes in 2009.

AT&T will raise DSL prices outside the former BellSouth territory, a spokesman confirmed Tuesday. Subscribers to the three lowest-tier AT&T plans will pay $5 more monthly, he said. Prices rose “to better reflect the value of our broadband service and market conditions,” he said. Charges won’t increase for U-verse plans, a $19.99 naked DSL plan or a $10 promotion for new AT&T DSL customers, he said. Increases take effect Feb. 16 for new customers and in March for current subscribers, he said. AT&T may be raising prices “to take advantage of customer inertia and customer frugalness to support revenues,” said Moody’s analyst Dennis Saputo in an interview. “Customers with these DSL speeds are probably quite satisfied with the speed or else they would have gone to cable which generally offers much higher speeds,” he said, and AT&T may have decide those customers would swallow a $5 rise. But it isn’t a good idea, he said: “The $5 increase will push some customers to cable and once they go they are unlikely to ever return, especially if the cable company is upgrading its service offerings.”

The International Trade Commission is studying Broadcom evidence related to Qualcomm workarounds, Chief Financial Officer Eric Brandt said at the Thomas Wiesel Conference in San Francisco. The ITC must decide if an injunction won by Broadcom against Qualcomm also applies to chips designed to work around infringement. Brandt also spoke of a potential Motorola mobile division spinoff and the macro-economic environment. On Motorola, Brandt said he’s “not sure that it’s good or bad at this point,” noting that a Motorola split could “create opportunities for us.” Broadcom and Motorola’s relationship “remains strong,” he added. On the economy, Broadcom sees “storm clouds on the horizon but it’s just not raining here yet,” Brandt said. Due to the semiconductor maker’s “end of the whip” industry position, Broadcom won’t see impact before customers do, he said. Meantime, Broadcom will keep inventories “as lean as possible,” he said.

A patent holder is suing Nokia for $17.7 billion in Germany, Nokia confirmed last week. IP-Com sued Nokia Dec. 13 in the Mannheim, Germany, district court after Nokia refused to pay that price for a license. “We demand at least 12 billion euros in license fees for the patents which we own and which Nokia uses in its products,” Christoph Schoeller, managing director of IP-Com, told Reuters last week. That claim is “completely unrealistic” and Nokia “will of course defend itself,” a Nokia spokeswoman said. The patents in the suit originally belonged to Bosch, she said. Bosch “refused to honor its commitments to standardization organizations and Nokia,” instead selling the patents to IP-Com, a company owned by Bosch outside counsel, she said. Nokia believes the patents are “invalid and not infringed,” and has claims pending against Bosch, she said.

There’s enough room in wireless for WiMAX and LTE to coexist, said an official from WiMAX equipment maker Alvarion in an interview. “I think everyone loves conflict but the reality is it’s a huge world,” said Patrick Leary, assistant marketing vice president. A similar battle of words was fought between CDMA and GSM network technologies, he said, but both are still going strong. Even if WiMAX and LTE split the wireless market fifty-fifty, “there’s hundreds of billions on either side,” he said. WiMAX has advantages, he said: “WiMAX as a technology has this ability to solve distinct problems that distinct carriers may have.” Alvarion sells equipment to a “wide swath” of operator customers using WiMAX for different end goals, he said. AT&T is using WiMAX in Alaska because it’s the least difficult way to deploy a broadband network there, he said. Virginia startup DigitalBridge is using WiMAX to carve out a market niche serving under-served areas, he said. Digicel is a “pure cellular” voice carrier in the Caribbean seeking to increase competitiveness against incumbent rivals, he said. TDS, a CLEC from Madison, Wis., launched a WiMAX network in late January to escape adverse impact from wireline deregulation in the region, he said.

Sprint said Wednesday that it’s committed to the Nextel push-to-talk network, but some analysts have doubts. “Nextel Direct Connect provides a differentiated experience for our customers,” CEO Dan Hesse said. “The Nextel National Network (iDEN) is key to delivering Nextel Direct Connect. Sprint has invested significantly during the past two years and the network is performing at best-ever levels. Customers can expect to see continued investment and the introduction of new handsets to utilize the network’s unique capabilities.”

Clearwire and Sprint Nextel are aligning WiMAX network architecture and are close to a roaming agreement, Clearwire CEO Ben Wolff told analysts at an investor day in Portland, Ore. The companies called off a partnership last November (CD Nov 13 p6), but talks continued, progressing greatly the past 60 days, Wolff said. Sprint and Clearwire networks will share features, functionality and performance expectations, smoothing the way for roaming, Wolff said. Sprint and Clearwire are jointly testing WiMAX device interoperability and sharing data collected from network trials, he said. The cooperation means the companies are “moving the ball faster than either of us would do on our own,” Wolff said.