Cell Phones

''The auction and the resulting acquisition of additional spectrum here in the USA is an important step forward for us. And not just for T-Mobile USA but for the Deutsche Telekom Group as a whole, which benefits from the growth of its U.S. business,'' Kai-Uwe Ricke, chief executive of Deutsche Telekom, said in a statement.

Underscoring the urgency of T-Mobile's effort to catch up with rivals' high-speed wireless Internet access and flashy video services, the company said it already has upgraded half its New York City network and expects ''most of the work'' across its national network to be complete by the end of 2008.

T-Mobile USA has a call center just south of the Lehigh Valley Airport in Hanover Township, Lehigh County. The facility is staffed 24 hours a day, seven days a week to serve T-Mobile's U.S. customers. It has handled mostly customer calls of a general nature, such as billing questions, since 1996. Last year it announced an expansion that would shift its focus to technical calls. It employed 975 workers at the end of 2005.

Customers in some T-Mobile markets will be offered new services enabled by the upgrade starting in mid-2007, executives said at a meeting with journalists in New York, a rarity for the company. The company did not detail specific new services, or where they'll be available first, though New York obviously seemed a good bet.

At the same time, executives dismissed the suggestion that the company has been badly hurt by its shortage of spectrum licenses, which limits the number of phone calls and nonvoice services that can be delivered over the network at any one time. Robert Dotson, chief executive of T-Mobile USA, stressed that the company's financial performance has been on par with its rivals despite the apparent network handicap.

Dotson noted that T-Mobile's average revenue per user of $52 per month is a couple of dollars better than market leaders Verizon Wireless and Cingular Wireless, and that the nonvoice share of that figure, $5.65, is in line with its rivals even though they already have speedier next-generation networks and services.

''I wouldn't go so far as to say we haven't suffered at all,'' Dotson said in an interview, asserting that T-Mobile was seen as more innovative than its rivals until they started rolling out third-generation, or ''3G,'' technologies. ''If Verizon's coming out with video clips and streaming this and that, does that harm your image in the market? Sure it does…But if you look at the financials, you can't see the difference between 2G and 3G.''

T-Mobile's U.S. network is to be upgraded with the same ''UMTS'' technology for broadband wireless data used by Cingular and most foreign cell carriers, including T-Mobile's networks in five other countries. Executives declined to say which communications equipment-makers are supplying the gear for the network upgrade.

Besides launching new phones to take advantage of the new network, the company plans to introduce laptop modem cards that connect to both the new cellular data network and the Wi-Fi hot spots at Starbucks stores and other locations where T-Mobile provides that service. Lacking the capacity for speedier online wireless connections until now, T-Mobile has invested heavily in Wi-Fi service as an alternative lure for laptop users.

The cost of the U.S. upgrade is expected to be offset in part by reduced investment in T-Mobile's existing network as the deployment of the new systems progresses.

T-Mobile was the top spender in an FCC auction of new licenses to use the public airwaves for wireless services, accounting for nearly a third of the $13.9 billion raised when the bidding closed last month.

T-Mobile lays out plan for upgrade