Months after admitting to excessive wireless congestion in Manhattan for its iPhone and other wireless customers, U.S. carrier AT&T Inc. today announced the launch of a pilot Wi-Fi hot zone in New York City’s bustling Times Square.
The hot zone, installed in the north central part of Times Square near 7th Avenue between 45th and 47th Streets, will allow AT&T customers to get Wi-Fi access with any qualifying smartphone, 3G LaptopConnect card or AT&T High Speed Internet plan, AT&T said in a statement. AT&T has 32 million customers in the U.S. with eligible smartphones or network plans.
The pilot project could be expanded to other areas of the country with consistently high 3G cellular traffic and mobile data use, AT&T said. In addition to Manhattan, AT&T has indicated congestion problems in San Francisco’s financial district.
The timing of AT&T’s Times Square hot zone is notable, given the likely announcement of a fourth-generation iPhone by Apple Inc. on June 7. iPhone customers have been the most vocal critics of AT&T wireless service since the first iPhone was introduced exclusively on AT&T’s network three years ago.
One analyst, Kevin Burden of ABI Research, said that while iPhone users and Apple have been prodding AT&T to improve its 3G cellular coverage, he doubted that the next-generation iPhone announcement coming in June is specifically a trigger for the Times Square Wi-Fi pilot launch.
“I don’t imagine AT&T is thinking, with the iPhone 4G coming out, it’s good they don’t suck as much in New York or San Francisco,” Burden said. “What’s most important to AT&T is nationwide 3G coverage, and those two cities are only two cities in a very large country with many major cities. Dead zones are a problem for all the carriers.”
Jack Gold, an analyst at J. Gold Associates, said the Times Square Wi-Fi pilot “is just a drop in the bucket” for all the congestion problems AT&T faces. He said the pilot would be impressive if AT&T were allowing all users on 3G cellular to be automatically switched over to Wi-Fi.
AT&T has repeatedly acknowledged the drain on network resources from new smartphones, including the iPhone, and has launched a variety of network expansions to try to meet current and future demand.
“With this pilot AT&T Wi-Fi hotzone, we’re examining new ways to combine our Wi-Fi and 3G networks to help ensure that AT&T customers in Times Square always have a fast mobile broadband connection to do what matters most to them,” said John Donovan, AT&T’s chief technology officer.
Manhattan and downtown San Francisco have been repeatedly identified as particularly congested for AT&T users, and today’s announcement of the Wi-Fi hot zone in Times Square comes only 15 days after AT&T bragged about improved cellular service in New York City, citing third-party test results by Global Wireless Solutions Inc.
Some analysts, including IDC’s Scott Ellison, noted the problems in New York City and San Francisco as early as last October when Ellison said, “AT&T has immolated itself with network capacity issues.”
AT&T Mobile CEO Ralph de la Vega last December said a new 850 MHz channel helped AT&T “turn the corner” with congestion in Manhattan and promised “gradual improvements” there. “You’ll see this is going to be fixed. We’ll do a lot better,” he said at the time. He also identified problems with cell tower antennas in the financial district of San Francisco.
A spokesman said in early May that San Francisco upgrades were still underway and “not quite where we want to be yet.”
AT&T said it has seen mobile data traffic growth of 5,000 % over the last three years. Wi-Fi in Times Square and elsewhere could be especially helpful with the congestion problems, given Wi-Fi is popular on mobile phones, AT&T said. In the first quarter of 2010, AT&T handled 53 million Wi-Fi connections on its network, which was nearly five times greater than in the first quarter of 2009.
Also in the first quarter, nearly 70% of Wi-Fi connections came from smartphones and related “integrated” devices, up from 35% in the first quarter of 2009.
AT&T also has a major commitment to Wi-Fi to supplement 3G cellular, with 20,000 Wi-Fi hot spots in airports, hotels and coffee shops.
