AT&T plans 20 new phones, major Android push

LAS VEGAS Wed Jan 5, 2011 5:12pm EST

LAS VEGAS (Reuters) - AT&T Inc plans to sell 20 phones sporting high-speed Web surfing this year, including a dozen running Google Inc software, in the U.S. carrier's biggest push yet to lessen its dependence on Apple Inc's iPhone.

The mobile operator, which has been the exclusive U.S. provider for iPhone since 2007, is expected to face tough competition early this year with bigger rival Verizon Wireless expected to kick off sales of the popular cellphone.

AT&T executives said on Wednesday at the Consumer Electronics Show that the 20-phone lineup would include Google Android devices from Motorola Inc, HTC Corp and Samsung Electronics Co Ltd. By comparison, it announced five new smartphones at last year's CES.

The No. 2 U.S. mobile provider also said it would sell a tablet computer from Motorola, but declined to elaborate.

The twin Motorola announcements suggest a shift in industry allegiances as Motorola has recently been the key phone maker for Verizon Wireless, a venture of Verizon Communications Inc and Vodafone Group Plc.

Motorola said its Atrix 4G phone, expected to go on sale this quarter, will attach to a laptop so consumers can take advantage of the computer's bigger screen for Web browsing or viewing videos.

"It will change the way people work," AT&T's president and head of mobility, Ralph de la Vega, said in an interview on the sidelines of the event.

De la Vega said that, after a "good fourth quarter" with a "seasonal pickup in demand," he sees 2011 being a strong year for smartphones sales, which he plans to boost with higher-speed network upgrades.

SPEED UPGRADES?

AT&T has come under fire for its patchy wireless service, which is under increasing strain as bandwidth-hogging smartphones proliferate.

The executive vowed to speed up AT&T's plan for upgrading its network with LTE, a high-speed technology already offered by rival Verizon. AT&T's LTE launch is scheduled for the middle of 2011 with coverage for up to 75 million people by year's end. That would put it a year behind its bigger rival Verizon.

But De la Vega said his company plans to pick up the pace in 2012, with an aim of having its national LTE high-speed upgrade largely complete by the end of 2013. He promised the first LTE phones in the second half of this year.

However, one analyst said that he expects AT&T's news to be upstaged by announcements expected from Verizon Wireless during its CES keynote and news conference on Thursday.

"They did what they could to take the wind out of Verizon's sails," said CCS Insight analyst John Jackson. But he added, "It's not going to be enough to overshadow what Verizon comes out with.

Jackson said he expects Verizon Wireless to announce a new wireless service with Google and roughly six or more devices such as smartphones and tablets that work on Verizon's LTE network.

Meanwhile, AT&T said it would start selling its first phones supporting another high-speed technology known as HSPA Plus, which it installed in its network last year to increase Web browsing speeds four-fold.

Phones based on this technology will arrive from Motorola and HTC in the first quarter and be followed by a high-speed phone from Samsung in the second quarter, de la Vega said.

AT&T said HTC will supply a phone called Inspire 4G. The Samsung Infuse 4G phone will be the operator's thinnest phone at 9 millimeters and will sport its largest display, a 4.5 inch screen, AT&T said.

Since AT&T's smaller rival, T-Mobile USA, began marketing its HSPA Plus phones as fourth-generation (4G) devices, AT&T has followed suit, starting at the electronics show in Las Vegas. It now refers to both HSPA Plus and LTE as 4G technology.

De la Vega did not comment on how AT&T will avoid confusing consumers by using the same marketing term for two different services. The executive said his company was simply following the industry trend.

AT&T shares closed 10 cents higher at $29.98 on the New York Stock Exchange.

(Reporting by Sinead Carew; editing by Maureen Bavdek, Matthew Lewis and Andre Grenon)

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