The use of mobile devices and data usage is dramatically increasing, so much so that mobile carriers are now faced with a colossal problem: service shortages.  The more people that sign up to a specific carrier means more people will be jamming up the lines with consuming data plans, which these carriers are not fully equipped to handle the surge in demand. AT&T, T-Mobile and Verizon have all thrown in the towel on unlimited data plans.  So how are mobile carriers addressing consumer needs, and can Sprint handle the pressure?

Sprint

In a move to attract more consumers, Sprint decided to keep offering unlimited data use for a fixed monthly rate.  Their plan worked, but now the problem is network congestion.  To deal with the issue, Sprint plans on upgrading their services to Long Term Evolution, but the problem here is, they’re only allotting 10 megahertz of spectrum for the upgrade, unlike AT&T and Verizon which allots 20 megahertz of spectrum for their LTE offering.

Ten megahertz of spectrum is not enough to address subscribers’ needs, especially with Sprint’s unlimited data plan.  This would end up straining the network, or give end users very slow surfing speeds.  If Sprint wants their LTE upgrade to be successful, they may have to control data use in order to keep their network healthy.

But Sprint doesn’t see the need to drop their unlimited offering since the section of the 1,900 megahertz spectrum band they set aside for LTE is currently unused.  If the company secures regulatory approval, Sprint will reallocate the spectrum in its 800 megahertz band to use for the high-speed service by early 2014.  And they are said to be in talks with Clearwire to expand their partnership by allowing Sprint to piggyback on their LTE to boost their hotspot coverage.

“I don’t consider it a headache,” Bob Azzi, a Sprint executive in charge network told Reuters, “We have a good understanding of the nature of those plans and what they do.”

AT&T

AT&T’s plan to acquire T-Mobile was plagued with so many obstacles that it led to the company pulling out their FCC application with FCC Chairman Julius Genachowski’s proposal for an administrative hearing the last straw.

The deal was supposed to help AT&T bring LTE to rural parts of the US but others are seeing the deal as being anticompetitve and would cost thousands to lose their jobs.
In what could be seen as a Hail Mary pass to push through with the deal, an unknown source told Bloomberg that AT&T is planning on selling more assets than originally planned.  Though no exact numbers were given since the plan hasn’t been publicly announced, it is estimated that about 40% of T-Mobile’s assets would be sold.

According to the source, ATT’s proposal would likely include “the divestiture of a higher share of customers and lower percentage of spectrum,” as the company needs more capacity to serve users as it adds customers and more of them adopt data-intensive smartphones.

No official word from either company has been released.  For the plan to push forward, AT&T can either fight the court case and hope that they would win, or make sure that the T-Mobile deal won’t greatly affect the market.  AT&T seems to be putting the second plan into action as they are said to be in talks with  MetroPCS and Leap Wireless, convincing them to sell spectrum and customers in a way to keep the competition alive even with the absence of T-Mobile.