Delving into the technical aspects of wireless carriers and how they operate, one interesting concept relates to how the carriers access and distribute its network backbone- meaning mobile voice and data services. You’ve likely heard the terms “tier-1″ or tier-2” carriers, but what does it mean and how do the major US carriers stack up?
Put simply, a tier-1 carrier possess a network in which it’s the sole operator- meaning it has a direct connection to the Internet and the networks it uses to deliver voice and data services. Similarly, a tier-2 carrier operates the same way, except it may get a portion of its network from a tier-1 operator by way of a concept known as “peering,” which can be loosely defined as piggybacking onto the network already in place by a tier-1 source. Tier-3 refers to a carrier who gets 100% of its network through a tier-1 or tier-2 operator, with no direct-access of its own.
The landscape in the US has changed dramatically in recent years, with consolidation of smaller carrier making way for a select group of premiere carriers- mainly AT&T, Verizon, Sprint and T-Mobile. All four of the aforementioned wireless carriers are tier-1 carriers, meaning they don’t borrow network capacity from anyone else. These four tier-1 operators have been busy acquiring tier-2 and tier-3 carriers in an attempt to broaden its subscriber base, leaving very few independent tier-2 and 3 operators in the US. An example of a tier-2 carrier in the US is U.S Cellular, who has an agreement in place with Sprint for voice and data coverage.
A tier-2 or tier-3 carrier is most likely a smaller, regionally-based carrier focusing on smaller networks, who can simply buy voice and data coverage from one of the big guys (a tier-1 operator) and re-sell it to its subscribers without those subscribers knowing the difference. From a marketing standpoint, however, working with tier-1, 2 or 3 carrier can make a difference in terms of distribution- especially in terms of SMS and other network-specific channels. In the end, it remains a technical aspect of wireless carriers that most consumers will never need to worry about, but if you’re a mobile marketer targeting carrier-specific channels, it’s definitely worth your time to do some homework and become familiar with the concept.