Verizon's big plans for 4G next year

Verizon Wireless Chief Marketing Officer Marni Walden surveys the carrier's lineup of 4G devices.

(Credit: Roger Cheng/CNET)

Verizon Wireless is keeping its foot firmly planted on the pedal when it comes to 4G LTE.

Verizon has an aggressive slate of 4G products in the works for next year--including the vast majority of its smartphones. The carrier also plans to make more 4G devices affordable, further driving adoption.

That'll be key to Verizon's effort to further extend its edge over the competition. The carrier was largely racing against itself when it came to 4G LTE this year, but 2012 will be different as rivals work quickly to roll out their own next-generation networks. Verizon, for its part, isn't so concerned.

"We have the lead today and continue to have the lead because it takes a long time to build things up," said Marni Walden, chief market officer of Verizon Wireless, in an interview with CNET. "We believe we can continue to extend the lead."

A speedier 4G service has increasingly become a critical tool for carriers looking to win over consumers in an already saturated market.

"With the crushing data requirements that smartphones represent, the perception of fast, reliable networks is becoming more, not less important," said Maribel Lopez, an analyst at Lopez Research.

Verizon still holds an intimidating lead over its competition when it comes to 4G LTE deployment. The carrier told CNET that as of December 15, the 4G LTE network would cover 200 million people, surpassing its previous target of 185 million. It will also have reached 190 markets, with Youngstown, Ohio, being the latest addition.

The speedy rollout--it took two to three years to achieve the same coverage with 3G--has helped put a stamp on 4G even as the term has nearly lost its meaning through overuse. Sprint offers a variation of 4G called WiMax, which is it will wean itself off of as it moves to LTE next year. AT&T and T-Mobile USA both offered up an upgraded version of 3G it considered 4G, but AT&T has more recently been rolling out its 4G network, now available in 15 cities.

But Verizon, thanks to a massive marketing campaign, has largely been able to convey the sense that its 4G LTE network is a step above its rivals. Walden said it recently stepped up its efforts with ads focused on the breadth of products, availability of service, and apps that can take advantage of the higher speeds. Its efforts have been successful enough that mainstream consumers are beginning to wonder whether they need LTE as well.

That's translated into growth. In the last quarter, Verizon added more than 880,000 subscribers willing to sign a service contract, outstripping the its rivals.

"I've been pleasantly surprised and overwhelmed by how customers are adopting the technology on a smartphone," Walden said.

LTE for everybody
One of Verizon's goals next year is to accelerate the number of people on the LTE network. That means a wider selection of 4G devices, and many more that are affordable. Walden said that the "vast majority" of the smartphones coming out next year would be 4G-enabled.

The upcoming 4G-enabled Droid Xyboard tablets.

(Credit: Roger Cheng/CNET)

Verizon has 16 LTE devices out already. Four more are expected this year: the two Droid Xyboard tablets, which CNET reported on yesterday, the Droid 4, and the Galaxy Nexus. Walden didn't provide release dates or pricing information on the products.

In the rush to get as many LTE products out this year, Verizon ended up with a glut of products coming out in the back half of the year. While a strong selection of phones is never a bad thing, the sheer number of releases can be intimidating for customers. Walden said she hoped to avoid the same issue next year.

"This year was an anomaly," she said. "I would expect more time separation between devices."

Verizon will spread its product rollout more evenly in 2012, with at least one flagship Droid device coming each quarter, Walden said.

iPhone sales still strong
One potential 4G device Walden didn't speak about is a possible LTE-enabled iPhone. Of course, Verizon--and every other carrier--is typically mum when it comes to that subject.

But on its current iPhone, Walden said the device continues to sell well, and in most cases is on back order.

"That tells you it's really important in the marketplace," she said.

The iPhone has been particularly good at drawing in customers who are new to smartphones or intimidated by Android. The push to upgrade its existing subscriber base has been a major priority for Verizon, which early in the year boldly claimed it would get half of its contract subscriber base on smartphones. Walden wouldn't comment on whether the carrier would meet that goal.

Similar to the iPhone, Walden said HTC has also been good at creating phones that ease customers into the smartphone world.

HTC has had a tough time recently, with a revenue warning that has many wondering if the handset manufacturer has lost its mojo. The company expressed a commitment to create a more flagship phone, something that was missing this holiday season.

Walden expressed her support for HTC, and said the company will make it a goal to launch more flagship phones with the Taiwanese company.

"We're going to do some things that will stand out for Verizon and HTC," she said.

Windows Phone needs LTE, stat
While Android and the iOS are taking off for Verizon, one platform that has stalled at the carrier is Microsoft's Windows Phone operating system. Verizon quietly put out one Windows Phone handset in the market this year, and Walden didn't seem particularly excited to be adding more.

For Verizon, the biggest problem with Windows Phone is the lack of support for LTE. Microsoft has said it would add LTE support, but hasn't been specified as to when.

"We've communicated to Microsoft that LTE is critical to us," she said. "We need to see a timeline that makes sense if we want to continue to represent them."

Given Verizon's LTE focus, it'll be hard to see a handset maker successfully convince Verizon to take a chance on a 3G Windows Phone product.

Verizon continues to work with Microsoft on this issue, Walden said, but didn't have anything new to discuss.

Verizon further bolstered its position today by announcing a deal to buy unused wireless spectrum from three cable providers for $3.6 billion. The acquisition is expected to sustain its long-term 4G plans and beyond.

For now, Walden is content to duke it out with her competitors.

"We're going to let customers decide who has the real 4G LTE network," she said.

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How Carrier IQ was wrongly accused of keylogging

In just a few days, a startup company named Carrier IQ has been subjected to extraordinary public vilification, with reports accusing it of making a "rootkit keylogger" that "creeps out everyone" or is the "rootkit of all evil."

The only problem, which is always a risk when a public lynching takes place, is that Carrier IQ appears to be not guilty of the charges lodged against it.

The most serious charge against Carrier IQ, a venture capital-funded startup in Mountain View, Calif. that makes diagnostic software for carriers, has been that it records keystrokes and transmits them to carriers. One article on a Mac Web site breathlessly reported that "Carrier IQ Probably Violated Federal Wiretap Laws In Millions Of Cases."

Well, no. There's zero evidence that Carrier IQ captured, recorded, or transmitted any keystrokes. But that didn't stop the self-appointed lynch mob on blogs and on Twitter (#OccupyCarriers, that would be you).

Dan Rosenberg, an exceptionally talented security consultant who has discovered over 100 vulnerabilities in the Linux kernel, FreeBSD, and GNU utilities, extracted a copy of Carrier IQ's software from his own Android phones. He then analyzed the assembly language code with a debugger that allowed him to look under the hood.

"The application does not record and transmit keystroke data back to carriers," Rosenberg told CNET. His reverse-engineering showed that "there is no code in Carrier IQ that actually records keystrokes for data collection purposes."

Carrier IQ has given Rebecca Bace, a well-known security expert who's advised startups including Tripwire and Qualys, access to the company's engineers and internal documents. (Bace says she has no financial relationship with Carrier IQ.)

Bace told CNET that: "I'm comfortable that the designers and implementers expended a great deal of discipline in focusing on the espoused goals of the software -- to serve as a diagnostic aid for assuring quality of service and experience for mobile carriers."

Andrew Coward, Carrier IQ's vice president for marketing, acknowledged last night that the company may not have taken the best approach in responding to public criticism, which started with a blog post by Trevor Eckhart, a 25-year old system administrator in Connecticut who noticed unusual software on HTC EVO devices. He dubbed it a rootkit, leading to legal threats from Carrier IQ, an intervention by the Electronic Frontier Foundation, and an embarrassing bit of backtracking a few days later.

Threatening to sue a security researcher, even a newly-minted one, isn't exactly the way to make friends nowadays -- especially after the last decade has seen a parade of ill-received threats from Cisco, HP, voting machine makers, and the Recording Industry Association of America.

That legal threat, not unreasonably, led critics to assume the worst. "That's really been part of our challenge in responding to the allegations," Coward told CNET. The company decided it needed to be more forthcoming after "going back and saying, 'No, we don't, no we don't,' which is where we started, didn't really work." (The company also released a public statementyesterday.)

There's now a "vast misunderstanding of what we do," Coward says.

That Carrier IQ is innocent of the keylogging accusation, the most serious charge, does not, however, mean there are no privacy concerns.

Coward acknowledged that the company's software, which is designed to be installed by carriers, can report back what applications are being used and what URLs are visited. Carrier IQ doesn't make these decisions; rather, they sell configurable software and the carriers decide what options to enable.

"It's up to them whether they do or don't collect that information," Coward says.

The information is used to summarize how the device is working so carriers can improve their networks, he says. It also helps them when they're forced to field calls from outraged customers wondering why their handset keeps crashing or runs out of battery life in a few hours.

Typically the data dump to a carrier is configured to be sent daily, either over Wi-Fi or the carrier's networks, Coward said. "The device ends up storing about 200 kilobytes of data," he says. "That's typical upload size. When it gets to the point that it's full, it'll do an upload or it'll drop data and start wrapping and store summary information." (Customers aren't charged for the upload, and it's disabled when the phone is roaming.)

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