Wireless CEOs Push Deregulation in CTIA Keynotes

The CEOs of AT&T and Deutsche Telekom warn in keynote addresses that excessive government regulation may curb the growth of the wireless market. CTIA Wireless speakers have been citing the FCC's upcoming National Broadband Plan as a chance to free up more broadband for their companies and services, despite the cautionary notes about regulation.

LAS VEGAS-The CEOs of some of the world's largest wireless companies have been insisting in keynote addresses at the CTIA Wireless conference that future growth and innovation for the industry is dependent on a hands-off regulatory policy by governments. Those executives also emphasized that the Federal Communications Commission's National Broadband Plan could have a substantial effect on the industry in coming years, depending on how it is executed.
Rene Obermann, CEO of Deutsche Telekom, which owns subsidiary T-Mobile, in a March 24 address compared the growth of wireless in the United States and Europe, where he said net customer growth had become "more or less stagnant."

Europe's more stringent regulatory approach toward the wireless industry, Obermann argued, led to less investment than in the United States, where "the mobile market developed in a relatively deregulated environment."

He added, "I am optimistic that American policy makers will want to continue this trend to ensure growth and investments in the future. The U.S., given the growth curve in mobile Internet, should move fast as possible to make the most spectrum available."

That availability, apparently, relies on the specifics and implementation of the FCC's National Broadband Plan, which will attempt to expand affordable broadband access to approximately 93 million Americans currently lacking a high-speed connection. As planned, that expansion will involve a combination of price reductions and investment in broadband infrastructure, and the FCC plans to auction off spectrum for that use at some point in summer 2010.

"The FCC with its plan to open up further spectrum, it's a great signal, it will clearly help customers with innovation," Obermann said. "However, timing and the volume of the spectrum is very critical."

Obermann's comments echoed those a day before from AT&T CEO and President Randall Stephenson, who said during his keynote that what he perceived as the current U.S. advantage in wireless could quickly become lost, especially if the wireless industry lacks the bandwidth and freedom to maneuver-an implicit statement on both the FCC's plan and potential government regulation.

"Limited spectrum means limited bandwidth and limited growth," Stephenson said. "Spectrum is the backbone for this industry; it is crucial for delivering innovation."

Also at CTIA, T-Mobile announced a plan to deploy HSPA+, a 3.5G technology, across its extant 3G area of roughly 185 million people. The 3.5G network, which made its debut in late 2009 in Philadelphia before expanding to other U.S. cities, will supposedly deliver data three times faster than 3G networks.

"This year T-Mobile will upgrade its national 3G network to HSPA+, which will support faster speeds and give customers a superior wireless data experience when they access their mobile social network, stream videos or share content," Neville Ray, T-Mobile senior vice president of engineering and operations, said in a March 23 statement.

In early February, reports circulated of T-Mobile potentially being spun off from Deutsche Telekom. A Feb. 4 article in The Wall Street Journal quoted unnamed sources as saying the German conglomerate was exploring potential underwriters preparatory to divesting itself of the struggling unit, which ranks behind Verizon, AT&T and Sprint in the United States.

T-Mobile has had a rough time lately on the customer side: Both the carrier and Microsoft were forced into a long-running game of damage control in late 2009 after a server outage at Microsoft subsidiary Danger wiped out personal data for roughly 800,000 users of T-Mobile's Sidekick smartphone. A number of Sidekick owners continued to voice their displeasure in online forums following the incident, which T-Mobile attempted to smooth over with a $100 "customer appreciation card."

During his keynote address, however, Obermann discussed T-Mobile USA in future terms that suggest a spinoff or other divesting action may not be imminent or even on the table at all. He described the T-Mobile network as "the most competitive in the United States."