The Rising Tide of GSM
Has the battle between GSM and CDMA taking on VHS vs. Betamax proportions? In the wake of Brazilian carrier Vivo's decision to overlay its CDMA network with GSM, Scotia Capital Markets analyst John Henderson is suggesting Bell Canada, one of two CDMA carriers, in Canada, may follow the same path by spending $400-million in 2007/2008. In a research note, Henderson said Bell may have little choice but to make the GSM investment if it wants to keep its best customers when wireless local number portability is introduced next year. Currently, Rogers Wireless is the only GSM carrier in Canada, which makes it an attractive choice for businessmen and people who travel internationally. Given these are the most lucrative customers, it is a market no carrier wants to miss out on. But If WLNP allows Bell customers to easily switch to Rogers, that would be bad news for a business already struggling. Another consideration is that 90% of the handsets now being made are GSM, which means the hottest new device will be developed for GSM carriers first. The future of CDMA may rest on the large shoulders of Verizon Wireless. As long as Verizon sticks with CDMA, the technology will stick around. If Verizon blinks, CDMA could easily disappear…much like Betamax.
