Apple 2.0

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AT&T: 3G network will be ready in 275 markets by June 30

May 22, 2008: 8:41 AM ET

In a press release that carefully avoids any mention of the iPhone, Apple's U.S. mobile carrier announced Wednesday that roughly two-thirds of its nationwide cell phone network be 3G ready within the next month.

By the end of June, according to AT&T, 275 U.S. markets will offer download speeds of 1.4 Mbps and upload speeds of 500 to 800 kbps (using HSDPA for downlink and HSUPA for up).

AT&T EDGE network, by comparison, is rated at up to 236.8 kbps, but actual throughput is in the 50 to 90 kbps range (see here).

AT&T didn't specify what cities or states those 275 markets represent. But it did promise that the rest of its 350 markets will 3G-ready by the end of the year, by which point the network overhaul will have cost the company a grand total of $20 billion.

Earlier this month, AT&T's wireless chief promised to start delivering 7.2 Mbps in selected markets by early next year and maximum throughput of 20 Mbps -- Wi-Fi speeds -- before the end of 2009. (see here)

"Equally as important as the network," according Wednesday's press release, "is the device through which a customer experiences it. AT&T's handset portfolio in company-owned stores is more than 75 percent 3G-capable — and will be even more enticing with the addition of more 3G-enabled smartphones in the summer and fall of 2008."

The absence of any mention of Apple (AAPL) this close to the 3G iPhone's launch date is puzzling, given how good Apple's first-generation mobile device has been for AT&T (T).

Data from a recent Rubicon Consulting survey found that 47% of iPhone buyers had switched from another carrier and that iPhone users were spending an average of $19 more per month than customers using other AT&T mobile phones.

Chris Foresman at Ars Technica's Infinite Loop did some quick "back-of-the-napkin" calculations and figured that AT&T was pulling in about $167 million per month, or just over $2 billion dollars a year, from iPhone users alone.

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Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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