Posted: Tue, 26 May 2009 11:00 AM - 7,900 Readers

By: Kirk Ladendorf

AT&T Inc. has finished a major upgrade to its cellular network in Central Texas that doubles its capacity and improves its reach in hilly neighborhoods and inside buildings.

AT&T has spent several million dollars — it won't say exactly how much — to enable its advanced 3G network to operate at frequencies in the 850 megahertz spectrum band. The network will continue to operate in the 1900 MHz spectrum band that it had been using.

The effect, AT&T officials say, is like building more lanes on a freeway: There is suddenly a big increase in capacity for more 3G-related data uses, which can include everything from surfing the Internet to streaming video programming to customers' smart phones and computers.

In Central Texas, the improved performance extends as far north as Georgetown and includes Cedar Park, Pflugerville, Round Rock and Taylor, and as far south as San Marcos. The improved coverage also includes Bastrop and extends west of Austin to include Bee Cave, Dripping Springs, Lago Vista, Lakeway, West Lake Hills and Marble Falls.

The new spectrum also increases the network's coverage, AT&T engineer Zach Morsbach said, because the longer radio waves at that frequency reach more places.

"We were able to take the best spectrum available and use it on our best network," said Chris Penrose, vice president and general manager for AT&T's wireless business for the region that includes Austin.

The 850 MHz spectrum had been devoted to AT&T's older cellular network.

The company upgraded the antennas and network transmission equipment at a few hundred cell phone towers in the Austin area and is building a dozen new towers to improve coverage in areas such as Steiner Ranch west of Austin and the Blackhawk neighborhood near Pflugerville.

AT&T has completed a similar conversion in San Antonio and is working on an upgrade in Houston.

Industry analyst Jeff Kagan said AT&T and other wireless companies are spending more on their advanced networks because that is where the money is.

AT&T's wireless data revenue grew to $3.2 billion in the first quarter, up 39 percent from a year ago and double the level of 2007.

Much of that data traffic is being driven by users of Apple Inc.'s iPhone, which is available only to AT&T customers in this country. The company said 1.6 million new iPhone users started service in the first quarter.

The surge of new data services creates its own challenges, which AT&T discovered at this year's South by Southwest Music Festival. The March event draws thousands of visitors to Austin, and this year, it seemed as though most of them had iPhones.

Even though AT&T had bolstered its network capacity for the event, the spike in data traffic slowed the network to a crawl.

The experience taught AT&T that it has to get ready for wireless traffic surges that are 10 to 20 times normal levels at special events where high numbers of smart-phone users are concentrated in small areas.

*  Story Contributed by: Kirk Ladendorf