Faster network speeds are better, right?
LTE cis coming soon to the Samsung Galaxy S4 smartphone, offering double the downlink speeds of LTE (Long Term Evolution).
But U.S. carriers still have to upgrade LTE networks to operate with LTE Advanced, and their plans to do so are vague.
Even if U.S. networks were completely LTE Advanced-ready, some analysts question whether buyers would pay much more to upgrade their smartphones for a model with the LTE Advanced speed advantage. There's unlikely to be the same scramble for LTE Advanced as there was for LTE-ready smartphones such as the iPhone 5, which provide 10Mbps or more on LTE downlinks on average, boosting previous speeds by three times or more over 3G, analysts said.
One analyst is especially skeptical of LTE Advanced's value. LTE Advanced in a smartphone or tablet "is not important to the user, especially in the U.S. where carriers have been marketing LTE or 4G for years now," said Carolina Milanesi, an analyst at Gartner. "The novelty has worn off. To tell customers that LTE will be even faster ... is nice, but not life changing."
Jack Gold, an analyst at J. Gold Associates, said consumers don't understand what LTE Advanced is. "Will users actually see that much improvement? Will they notice anything all that different in their user experience? For most, probably not," Gold said Tuesday. "Carriers [and manufacturers] are really trying to find advantage to keep the market excited about their networks. Will users buy into it? Remains to be seen."
JK Shin, co-CEO of Samsung Electronics, said Monday that the Galaxy S4 with LTE Advanced capabilities will go on sale in South Korea in June and with wireless carriers in other countries later on. He said that a three-minute download of a movie using existing LTE technology would take just over a minute to download over LTE Advanced.
Of the four largest U.S. wireless carriers polled on Monday, T-Mobile USA said it was planning on LTE Advanced network support, although it has not announced a schedule.
Verizon said it plans three network improvements that will support LTE Advanced, some of which will be ready and "invisible" to customers later this year.
Sprint said it has already deployed some elements of LTE Advanced, but didn't elaborate on a schedule or other details. The carrier said LTE Advanced will give customers greater speed, capacity and improvements in video quality, and will help lower Sprint's costs to keep unlimited data plans.
AT&T is also expected to move to LTE Advanced, but didn't respond immediately to questions about timing.
The upgrade cost to deliver LTE Advanced is expected to be minor compared to the many billions of dollars it cost to upgrade networks to LTE with new antennas and switches.
Analysts said that while Samsung will introduce the GS4 in South Korea on LTE Advanced networks, the value of LTE Advanced could be far less exciting in the U.S. Smartphones are getting wide acceptance in the U.S., where a majority of Americans own the devices, according to a Pew Research Center survey. Smartphone makers and carriers face the challenge of marketing new features, such as faster network speeds, to lure buyers into trading in their old devices for new ones.
"We are getting to the point where selling innovation is hard," Milanesi said. "That innovation today is about user experience, convenience and incremental benefits -- not transformational ones."
Such incremental benefits are hard to sell in a store because the features take longer for salespeople to demonstrate, she added. The sales rep might be showing the improvements on "a phone that otherwise will look like all the rest -- or even worse -- like the previous generation," Milanesi said.
Gartner and other analyst firms noticed a new trend that started in the fourth quarter of 2012: U.S. smartphone owners were keeping their devices longer, holding them beyond a two-year contract rather than upgrading before the end of the two-year period to get access to newer hardware, software or network speeds.
"Some users might hang onto their smartphones and get a tablet instead," Milanesi added.
As a result of both lower perceived innovation in new smartphones and the hype to buy tablets, smartphone lifetimes are lengthening, Milanesi said. "That means for a market like the U.S. where we have a replacement market, [sales] growth will decrease," she said.
At Verizon, LTE Advanced is viewed as an improvement that will be invisible to customers, Verizon spokesman Tom Pica said. Verizon already has rolled out LTE to more than 400 cities, and LTE Advanced will mean customers "continue to find the consistent reliability and high speeds they have come to expect" from Verizon, he said.
Later in 2013, Verizon will deploy small cells and AWS (Advanced Wireless Services) spectrum as part of LTE Advanced capabilities. A third step, involving advanced MIMO (multiple input, multiple output) antennas for devices and cell sites, is in the plans, but no schedule has been announced.
AWS uses two spectrum bands in the 1700MHz and 2100MHz channels to increase network capacity for heavy data users but not necessarily speed. Verizon already sells seven devices that support AWS, including the GS4, the Nokia Lumia 928 and the BlackBerry Q10. Small cells can increase network capacity and network reach.
