AT&T caught in 4G crossfire…

This may be one of the few times to feel bad for the Telecom giant AT&T.  Sure, AT&T is a juggernaut in the telecommunication world, particularly with regards to wireless and cable.  AT&T is the sole provider of the iPhone and iPad in the US, two devices that are must haves.  Also, AT&T has the largest network in America in terms of coverage.  And AT&T’s U-Verse is a very formidable cable standard that is gaining in popularity.

But AT&T’s cellular market has taken a hit in recent years as the giant has struggled to provide 3G speeds, particularly in urban areas where iPhone usage has strained the network.  And now, AT&T seems to be lagging in a growing 3-way battle for pre-4G supremacy.  AT&T’s attempts to split the difference may provide turbulence over the next 4 years.

In one corner is Sprint and Clear, who started the 4G war by launching WiMAX 2 years ago in Baltimore.  Though the network stopped and started over the last two years, it now has a good base of customers and devices.  WiMAX may ultimately not survive, but it will be a force at least for the next 1-2 years.

The second corner is occupied by T-Mobile.  T-Mobile has all but officially supplanted AT&T as the fastest 3G network as their HSPA+ network has rapidly spread across the nation.  While AT&T is still modernizing their networks, T-Mobile has put in advanced infrastructure making upgrades to HSPA+ faster via software only, providing speeds that match and, in some cases, exceed WiMAX.  HSPA+ is a cheap alternative to WiMAX and LTE technology, as T-Mobile waits for the arrival of true 4G technologies.

The third corner is occupied by Verizon Wireless and MetroPCS.  MetroPCS has just launched LTE with Verizon following suit later this year.  Both had to go with LTE, considering that their technology was not keeping up with AT&T’s speeds.  Upgrading to LTE surpasses AT&T’s current network speed.

So what is AT&T’s plan?  Right now, AT&T is trying to upgrade to HSPA+ in some areas and LTE in others over the next two years.  In addition, AT&T will probably push Femtocells to help saturate coverage and close the speed gap.  Over the next couple of years, AT&T will likely be playing catch-up with more nimble competitors.  Don’t plan AT&T’s funeral yet, though.  AT&T has the resources to be the likely forerunner of true 4G when it arrives in 2013 or 2014.

For now, Apple is AT&T’s best friend.  As long as the iPhone and iPad maintain their status and are exclusive to AT&T, AT&T is fine.