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Verizon Communications Inc. (VZ), AT&T Inc. (T): Investing in Telecoms and Their 4G Future

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4G LTE is quickly becoming the new standard for wireless communications. 4G LTE is significant for wireless carriers because it offers speeds that are over ten times faster than the old 3G technology.

Verizon Communications Inc. (NYSE:VZ) is currently the leader in 4G LTE as far as size goes. With the largest LTE network in the nation, the company is also getting closer and closer to 100% LTE coverage — with a current 95% coverage rate over its 3G network. With 40% of smartphones sold now utilizing 4G LTE and 63% of internet devices running on it, it must feel good to be the leader — especially when 54% of your network traffic is now on LTE as well. So what about competitors?

Is bigger really better?

So Verizon Communications Inc. (NYSE:VZ) is running far ahead in the LTE race, but what about the other giant in the telecommunications industry? AT&T Inc. (NYSE:T) is also getting into LTE.

Chart data provided by Rootmetrics, via this source

While Verizon Communications Inc. (NYSE:VZ) held over 3.5 times more LTE markets than AT&T Inc. (NYSE:T) as of a March study done by research firm Rootmetrics, AT&T is not only faster, but is also expanding its own LTE coverage aggressively. Verizon Communications Inc. (NYSE:VZ) has the breadth, while AT&T Inc. (NYSE:T) has the speed. AT&T’s network has now been the fastest two years in a row, in fact. Currently, 30% of the company’s smartphone users utilize LTE.

Then there’s the small guys…

After beginning to sell the iPhone 5 in April, which has the capability to fully utilize LTE, T MOBILE US INC (NYSE:TMUS) also began to roll out LTE technology of its own in the same month. The LTE offering is currently only available in seven U.S. cities and hasn’t been tested for speed yet because of its relative newness, but shows that the company is committed to offering true 4G technology. The company’s CTO also has confidence in the fast-moving pace at which the company is expanding its new LTE offerings, stating that:

“T-Mobile’s 4G LTE network rollout is moving at a speed that’s unprecedented in the U.S. wireless industry–we’ll go from seven metro areas today to nationwide by the end of the year, with many major metros launching next month…”

The company also currently has its HSPA 42 services, which is faster than 3G and labeled as 4G by T MOBILE US INC (NYSE:TMUS), which can be utilized by its customers until the “true 4G” LTE is completely rolled-out. T MOBILE US INC (NYSE:TMUS) is smart for expanding into LTE and getting the iPhone 5 now, as it will leave them much better placed in the future — as opposed to being completely left behind, running just to play catch up to competitors.

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