Why Apple's iPhone Doesn't Need 3G

We've all read articles about why Apple's (AAPL) iPhone won't sell because it doesn't boast the latest and greatest 3G technology, which can transmit data at 1.8, 3.6, 7.2, and in some places, 14.4 megabits per second. Instead, Apple chose to go with the more ubiquitous EDGE system, which tops out at 0.2 mbits per second here in the US, and presumably will do the same in the UK and Germany when the iPhone launches there next month.

But the question left unasked as been, "Does 3G really improve the user experience dramatically?" Most pundits would reply, "Well, of course Internet experiences improve with higher bandwidth. That's why the world went broadband." And if the pundit is having a bad day, they'll add "Duh."

Funny thing though. They're wrong. Bandwidth doesn't affect the mobile phone experience nearly as much as most people think. And in some cases, high bandwidth Internet is actually worse for the user than a low-bandwidth one.

How can this be? Because:

• People confuse network bandwidth with latency. Think of latency as how long it takes bits to go from the server to your phone, while bandwidth is how many lanes of highway those bits can use to get there. Because mobile phone networks use narrow-band radio signals, their latency is on average 2 to 10 times that of a wired network. And because of the way the Web HTTP protocol works, the quality of a Web user experience depends much more on low latency than high bandwidth, because Web pages typically contain lots of different elements such as pictures, ads, and widgets coming from many different sources. The result: loading Web pages on a 3G phone may actually take about the same amount of time as a phone loading those pages over an EDGE network because all the network time is spent setting up and tearing down connections, not actually sending big amounts of data. And so far, most carriers have preferred to optimize bandwidth at the expense of latency. Why? Because it's more marketable (see erroneous analyst quote above).


• High bandwidth radio networks are more error-prone. Because of the sophisticated signaling needed to do high-data rate transmission over narrow-band radios, higher bandwidth networks don't do as well in real-world radio environments as a lower speed network will. Multi-path interference, doppler frequency changes, and radio noise disrupt high-bandwidth signals more than low. And since phones using TCP connections -- the dominant connection type used in Web browsing -- have to retransmit data that is corrupted by errors, even an error rate only a few percent higher will dramatically slow down Internet experiences.


• Phone processors and software don't necessarily keep up with fast data transmission. I noted this phenomenon when I compared my Nokia E61i with the Apple iPhone. Despite the Nokia's 3G and WiFi network capability, the phone actually felt significantly slower than Apple's iPhone on the same networks. Why? Because the Nokia processor/OS/software combination was simply slower at moving bits than the iPhone is. The result: even with a 54 megabit WiFi network -- a network several times faster than the fastest 3G network -- the Internet experience on the Nokia was significantly slower and poorer than that of the iPhone. The phone just couldn't keep up.


• High bandwidth networks drain batteries. Power consumption of any chip increases according to the frequency squared. That means if you want your network to go 10 times faster, the chip inside your phone managing that network consumes 100 times the power that a slower chip would (It's not quite that simple because of different signaling techniques, but the overall principle still holds). This is why Steve Jobs has decried the power consumption of 3G networks -- that speedy signaling actually matters in a battery-powered device. So why don't European users see this power-draining effect today with their phones? Well, check out the Nokia message boards and you'll find that they do experience some of the effect, but that effect is diminished by the fact that Europe has a much higher density of cell towers than the US does. And since cell phones decrease their radio power output when signal strength is high, the frequency effect of 3G transmission is partially offset by the fact they can use lower power amplifier settings for their radios.

The bottom line: Carriers, analysts, and consumers alike have an unhealthy obsession with bandwidth to the exclusion of other important factors that affect the user experience with a phone. Just as the computer industry finally figured out that more gigahertz wasn't necessarily better for users, the phone industry is going to discover the same point (and for the same reasons). And companies that use limited bandwidth in smarter ways to deliver a better user experience -- like Apple -- are going to have a leg up on their competitors no matter what network they use. Let's hope it doesn't take phone carriers as long as it took the computer industry to figure out they need to sell something other than technology to win over the average consumer.

Full disclosure: the author owns Apple stock.

Comments

[User 114082:]

this analysis in error ridden. my blackjack pulls in the same email about 20 times faster than the iphone. so did my treo, and my 3585. you decide.

2007 Oct 16 07:46 AM

[jmarc21a:]

just out of curiousity, how did you determine that your blackjack is 20 times faster, and not 2 times or 200 times. Doesn't sound very scientific. lol btw, what am i supposed to decide?

2007 Oct 16 06:15 PM

[John Lambros:]

I love the piece because I am an AAPL shareholder. With that in mind, I offer the following. When I was in Europe on my honeymoon, AT&T extorted me with data fees when I downloaded my business e-mail. I did not dare access the Internet with my iPhone. My wife, on the other hand, freely used her Blackberry without penalty. As much as I would like to have all of my employees use the iPhone, I cannot presently justify it. Apple is smart enough to get my company's business. I am confused as to why it does not want it.

2007 Oct 16 09:30 PM

[Andy Merrett:]

Note, though, Mr/s Anonymous, that this article dealt mainly with the Internet web surfing experience, not downloading a single long stream of data (ie email). Yes, that will be faster over 3G than EDGE, but I think the arguments made above still hold for the fragmented nature of the web.

2007 Oct 17 09:42 AM

[Dan Poarch:]

This article is mostly apologetic. Hands-down, the iPhone needs 3G. When it will work well inside the phone, and not until then.

However, 3G coverage is sparse outside of urban areas and not always dependable. The truth is that mobile broadband just isn't there in a lot of markets. I have a 3G AT&T phone and a Sprint Sierra Wireless USB modem. I get incredibly mixed results from both with the Sprint system being a bit faster and more reliable [In Cinci of all places I got the best reception I've ever had on the Sprint].

I'd rather see Wi-Fi in more locations. You're really using the internet in static locations like cafes, bars, work, etc.

However, having used Blackberries and iPhones, from a distance as I've owned neither, I can tell you that I'll take a slow iPhone over a fast Blackberry any day. If I was solely dependent on email, a Blackberry with 3G is the best choice. But if I'm not chasing email all day, the iPhone is ten times easier to use, more friendly, faster to navigate and more invigorating/useful/in...

2007 Oct 16 10:27 AM

[Tom B:]

Agreed. I think Jobs didn't go with 3G because that technology isn't quite "there" yet. When it is, the iPhone will use it.

2007 Oct 16 11:11 AM

[jmmx:]

WELL DONE MR. HOWE!

2007 Oct 16 11:37 AM

[Mordo:]

Wait...what?

If any of these arguments made sense, there'd be no need for UMTS/HSPDA phones. Bullet point number two is crazy talk - I keep going back to it for a laugh - I'm going to pass that around at work tomorrow, the guys will love it.

All of AT&T's "3G" phones are UMTS(many with HSPDA capability) with an GSM/EDGE "fall back" radio so it can be used in areas that don't have a UMTS network.

I've had about 10 of these phones over the last few years - the UMTS/HSPDA networks offer a MUCH richer web-browsing experience than the GSM/EDGE networks - to the point where a GSM/EDGE network is almost unbearably frustrating to use once you've used the UMTS/HSPDA networks.

Bullet point number three is also silly - not going to get into that one though.

You're right about number four.

One of the big reasons the iPhone isn't 3G is that millions will be sold at high profit margins with old & inexpensive technology and in a year and a half, many of the same people who bought version 1, will turn around & buy version 2 with 3G capability.

2007 Oct 16 08:18 PM

[Mordo:]

Crap - "HSPDA" = "HSDPA"

I might add that AT&T should be rolling out their HSUPA in some markets soon.

2007 Oct 16 10:14 PM

[Andy Merrett:]

"Bullet point number two is crazy talk - I keep going back to it for a laugh - I'm going to pass that around at work tomorrow, the guys will love it."

Wow, you and your colleagues don't get out much, do you?

2007 Oct 17 09:45 AM

[User 114520:]

This pretty much repeats my findings of usability of EDGE vs 3G (EVDO): for general internet browsing, EDGE does fine. As stated, latency refers to the delay between the server and the user, and when web-page loads require much communication back and forth, then lower latency times will beat out a faster data transmission rate protocol (e.g. EVDO), for the most part.

The situation where 3G completely runs circles around EDGE is in heavy downloading tasks, e.g. audio, but especially video, streaming (and up/downloading e-mail is another one, although it's generally not as large an amount of data as video streaming). My EyeTV Hybrid set-up will stream HD recordings on a local netowk via wi-fi to my iPhone (and it looks great!), but the heavy bandwidth demands means you'd have to wait 15 minutes to load even a minute of HD video (optimized for iPhone) via EDGE: just not practical. My Net Monitor program shows bursts of 15MB/sec to support effortless streaming (i.e. video on demand): try doing THAT over EDGE, or even EVDO! It's not going to happen....

Bottom line: if Apple/AT&T want to enter the video streaming market (and dare I say, viewing live T.V. on the iPhone <gasps!>) then they'll have to get serious about HSDPA/WiMax or some other "real" faster technology. For example, service providers in S. Korea and Japan offer MUCH faster networks that make video streaming a reality today for millions of users, although the network providers there are facing a small technical challenge (tighter population density over smaller areas, etc).

2007 Oct 17 01:04 PM

[User 114622:]

Nonsense! The iPhone is glacially slow using EDGE when WiFi isn't available in much of Los Angeles. In contrast, 3G phones at the same location are quite fast. In many cases what takes a few seconds with 3G takes several minutes with EDGE.

It's not the technology; it's AT&T's inadequate network. But the user doesn't care whose fault it is, and Apple should have insisted AT&T be better prepared if Apple was going only with EDGE instead of 3G or 3.5G when away from a wi-fi hot spot.

2007 Oct 17 08:15 PM

[contreras:]

Ok, I am a telecom engineer with 8 years experience in AMPS, GSM, CDMA IS95, CDMA2000, UMTS, HSDPA...

All your points are sadly wrong. Latency is around 10 times lower in a 3G network. I don't know if you are familiar with the term WIDEband CDMA... The carrier in 3G is wider than the ones used in 2G. The trick is in the coding, even at very low RF conditions 3G will perform much better than 2G... 2G (GSM) defined in 1992... while 3G in 1997, and HSDPA in 2002-4... you are trying to say that a technology that has been defined and standarized years after... is worse??? the consumption in 3G devices is higher, but if you want to make this comparision, you should consider that the data vs. time efficiency in the 3G device is much higher than the one in a 2G device. Of course if you just start "webbing" with no purpose, the 2G device will last more, but that is not the idea if you are a business user...

I think you need to visit real 3G markets in the world, unfortunately the US market suffers to have very low-quality networks, and I think that is the reason why someone can have conclusions like yours...

2007 Oct 18 07:12 AM

[aaron:]

The iphone has rubbish connectivity and this Carl bloke is a convincing commentator but not a cellular network engineer hence he hasn’t a clue what he is talking about. The fact that he even has the audacity to suggest that EDGE may be faster than a proper 3G UMTS network just goes to show what a bull$hitter he really is. Hundreds of billions of dollars were spent on 3G spectrum, this money was spent for a reason.

Carl, mate, stick to your commentary and leave the technical stuff to the engineers!

2007 Nov 14 05:30 PM

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