Qualcomm Inc (QCOM)

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From the February 3, 2006 print edition
EV-DO technology skips 'hot spots' but is it next big thing?
Carolyn Schuk

From the February 3, 2006 print edition

http://sanjose.bizjournals.com/sanjose/stories/2006/02/06/focus2.html

You're riding CalTrain to San Francisco. At the same time you're e-mailing a PowerPoint presentation to a colleague, making a VoIP call to a client in Beijing, and browsing the Web. You can do all this on a moving train because your laptop is equipped with the third generation cellular (3G) wireless technology, EV-DO -- short for Evolution Data-Optimized.

EV-DO provides continuous, high-speed wireless Internet access via the cell phone network. It's similar to the better-known wireless technology, Wi-Fi, but EV-DO supplies access without the need for a "hotspot." With EV-DO, the device is the hotspot in the same way a cell phone provides mobile connectivity.

"EV-DO really gives users a truly un-tethered experience," says Heidi Flato, Verizon Wireless's manager of public relations.

For people like real estate agents and sales reps, who are constantly on the move, EV-DO can provide a huge benefit by keeping vital business information at their fingertips where ever they are.

"What you can do at your desk you can do on the road," explains Jeremy James, senior director of corporate communications for wireless chipmaker Qualcomm, which introduced the initial design for the EV-DO standard in 1999. "You can do it on the road, on a train, in a customer's office. You don't have to go find a hotspot."

Another interesting use for EV-DO is for VoIP (Voice Over IP) phone calls. Making a VoIP call over a cell phone network may seem counter-intuitive, but for people who do business internationally, it makes whole lot of financial sense

"It's a real win," says Erik Lagerway, founder of Counterpath (formerly Xten Networks) and publisher of SIPthat.com. "If I can use VoIP, I'm paying a flat fee. I'm not paying roaming charges, no international connection fees, no peering fees. I just saved myself a boatload of money."

Internet access via cell phone networks isn't new. But in the past the data rates were slow and the quality was not what was needed for services like VoIP.

"Cell phones enabled people to connect when they were out and about," says Qualcomm's Mr. James. "But those data connections are so unsatisfactory that it wasn't useful in practical terms."

EV-DO changes that landscape according to its proponents.

The technology is based on the communication standard (CDMA) used in U.S. cell phone networks. The signal is carried on the same sites. EV-DO performance is comparable to DSL, delivering data rates up to 2Mbit/sec. Using an EV-DO equipped cell phone, PC wireless card or laptop, users connect to the Internet anywhere they can get a cell phone signal.

EV-DO also offers potentially more secure communications because it sends data as a series of small packets, sending each one independently rather than as a constant data stream -- reducing the ability of hackers to intercept a data stream.

Even where EV-DO service is unavailable, users can use the technology to connect to the existing cell phone network, and still get performance that is about twice as fast as dial-up.

EV-DO is competing with Wi-Fi for a rapidly growing market of mobile users.

For example, Sprint and Verizon are banking on EV-DO technology. Both made a big push to expand their coverage areas and have stated their intentions to provision all their network areas with EV-DO. Service plan prices range from $60 to $80 a month.

Verizon offers two EV-DO services -- BroadbandAccess for laptops and VCast, which provides delivers multimedia like short videos, 3D games and music on cell phones and pocket PC devices. It's not a stretch to imagine video cell phone calls using services like VCast.

But not everyone's convinced that EV-DO is the way to go. Some believe that Wi-Fi is going to win out for wide scale deployment in the long term.

"They serve different purposes," explains Chuck Haas, CEO of MetroFi, a Mountain View-based ISP that recently launched free Wi-Fi access in Sunnyvale and Santa Clara.

"EV-DO runs on a very expensive licensed frequency," says Mr. Haas. Wi-Fi by comparison, operates on unlicensed frequencies. "[EV-DO] Service providers need to get a return on investment which is much higher, which means much higher prices.

Mr. Haas also notes that few computers are presently equipped with EV-DO, as compared with Wi-Fi, which is virtually standard equipment for laptops these days.

Licensed frequencies translate to benefits for customers, counters Qualcomm's Mr. James.

"It's a business proposition and they [providers] own that spectrum," he explains. "They can impose policy rules, they can manage the load on the network. They can charge more for higher use."

Other EV-DO skeptics point to the fact that the devices won't work across borders. "There are two ways to solve the roaming issue," explains Qualcomm's Mr. James. "Get everyone the same technology or adapt to the network you're on. That's what's happening today. Integrating technology into the device is happening rapidly."

But it's not an all or nothing game. There's a place for each technology, depending on user requirements.

Not many consumers are going to pay the extra service and equipment costs for EV-DO, MetroFi's Mr. Haas thinks. However, "if you're a business user and you need ubiquity," he says, "EV-DO is a good solution."

Mr. James of Qualcomm also sees a place at the table for both technologies as well.

"Wi-Fi is great for local area networks -- that's why it's popular on corporate campuses and colleges. EV-DO is designed for wide area networking."

CAROLYN SCHUK is a freelance writer based in Santa Clara.