AT&T execs: U.S. must work hard to retain mobile lead

IDG News Service - AT&T executives described the U.S. mobile market as a world leader but warned that without continued hard work that position is in jeopardy, while speaking at the CTIA conference in Las Vegas on Tuesday.

Their comments might seem ironic to iPhone users, many of whom complain about AT&T's poor network performance.

But the growth figures that the executives shared perhaps explain why the operator has had a hard time keeping up with demand.

Over the past three years, wireless data volume in the U.S. grew more than 3,000%, said Randall Stephenson, president and CEO of AT&T. During that time, volume at AT&T grew 5,000%, he said.

"There is no doubt data consumption will continue to surge as networks get faster," he said.

The U.S. is ahead of the rest of the world in wireless broadband, said Ralph de la Vega[cq], president and CEO of AT&T Mobility. "No matter how you look at it, the U.S. is at the top," he said.

The U.S. has 117 million 3G subscribers, or 18% of the world's 3G subscribers, he said. The country with the next most subscribers is Japan, with 101 million 3G users, he said. Since the U.S. only has 7% of the world's total wireless subscribers, that's remarkable, he said.

The U.S. also leads the world in smartphone sales, with 2010 expected sales to be more than twice the number of the nearest country, he said. In 2010, the U.S. is expected to see 53 million smartphones sold, compared to 25 million in China, he said.

The U.S. leads in application downloads too, with 1.1 billion applications downloaded in 2009, he said.

But that success is no guarantee of success in the future, he said. He fears a time when demand outstrips the ability of networks to support users.

The U.S. Federal Communications Commission has promised to make available 500MHz of spectrum, which will help. But that will likely take years. In the meantime, operators can do a few things to help boost capacity. One is use complementary technologies like Wi-Fi and femtocells, he said. There are around 70,000 hotspots in the U.S. today, he said.

In addition, the industry should focus on increasing the efficiency of applications, he said. He said that AT&T tested the network consumption of mobile e-mail application providers and found an eight-times difference between the one that consumed the most and the least. Another study showed that one device maker used data more efficiently by a factor of three times compared to the next one. "Application efficiencies can help conserve spectrum," he said.

Using these methods to make sure to meet demand is crucial, Stephenson said. "The U.S. is leading the world but future leadership is not a birthright. We've seen America lose it's lead in fields it once dominated," including automotive, steel and manufacturing, he said. "The stakes our high and the opportunity is large. As a country we can't afford to mess this up."