This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

$199 Unsubsidized Verizon LTE Tablet Changes the Game

Stocks in this article: VZ T BBRY AAPL QCOM MSFT GOOG

Once you have deployed LTE at 700 MHz on the same cell towers as the old technologies at 800, 900, 1700, 1900, 2100 etc. MHz, there is no strong need to maintain backwards compatibility for those higher frequencies, for coverage reasons. Why? Because there are no longer any "gaps" between towers reachable only by the older, lower frequencies.

This has huge implications for Qualcomm, and for the cost of building devices such as smartphones and tablets.

What can you do now, with 700 MHz LTE, that you couldn't do before? You can launch products with so-called "single-mode LTE," which is an LTE chip without any backwards compatibility with the older 3G technologies such as EV-DO and HSPA. It may even operate at a single frequency, e.g., 700 MHz, in some cases.

This means you don't have to buy that LTE chip from today's de facto monopolist, Qualcomm. I don't know exactly how much money you could save, but my conversations with industry experts suggest that a far simpler LTE chip from a hungry second-tier vendor could reduce the price of a tablet or smartphone by more than $50 in some instances. Obviously the actual cost (revenue to Qualcomm) of just the LTE chip is less than $50.

Consider this: Apple charges $130 extra for LTE in its iPad tablets.

The biggest 700 MHz LTE beneficiary of this is Verizon because its backwards compatibility is tied more closely to Qualcomm than is AT&T. For evidence, see Verizon's CDMA, 1xRTT and EVDO legacy networks, all tied 100% to Qualcomm. Every single Verizon LTE device in the market today is Qualcomm, not coincidentally.

For this reason, it seems evident that the next move by Verizon is to launch an LTE tablet based on such a single-mode LTE 700 MHz chip this year. Would such a device be based on Android, iOS, Windows or BlackBerry?

My guess is Android. Why? Because speed of development in Android is leaps and bounds ahead of the other operating systems. Time-to-market simply trumps the other operating systems nine times out of 10. New technologies are typically introduced in Android first, then spread to iOS, Microsoft and BlackBerry as they catch up.

Today you can buy an unsubsidized, quality seven-inch Android tablet with a cellular data modem for $299, in the form of the Asus Nexus 7. This is the price leader for a true tablet, i.e., not a closed-OS book-reader. It's got HSPA, not LTE, but that may not matter much especially as T-Mobile's HSPA network is either 21 or 42 meg, depending on the market.

2 of 3

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,030.21 +6.04 0.03%
S&P 500 2,081.88 -0.29 -0.01%
NASDAQ 4,773.4720 +8.0480 0.17%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs