The celebration continues in Barcelona, Spain, at the Mobile World Congress, where Verizon Wireless unveiled the primary product suppliers for its LTE network, but the festivities are not limited to the four main companies awarded the contracts.

There may be dozens of unnamed third-party suppliers, including startups that stand to benefit handsomely from the LTE, or Long Term Evolution, project (Verizon Goes European With Untested Standard). The deals are a welcome reprieve from an unnerving recession that many analysts believe could put telecom startups out of business.

For companies such as Continuous Computing, picoChip, and mimoOn, supplying software and other products to the Verizon project will mean not only revenue but also a critical entry on their resumes. (A Startup's Recession Survival Guide)

Along with Verizon Wireless, TeliaSonera, NTT Docomo, AT&T, and China Mobile have all announced aggressive schedules to release LTE-based networks.

Despite the credit crunch carriers seem willing to spend a lot of money on LTE.

“The one area where carriers continue to see good growth despite the downturn is in the proliferation of data traffic so in order to push these services, they need capacity,” said Matthew Thornton, telecom equipment analyst with Avian Securities.

All-you-can-eat data packages have dramatically increased the amount of data being pushed across wireless networks (Verizon Adopts New Wireless Technology). But general pricing pressures are forcing primary suppliers such as Alcatel-Lucent and Ericsson to use more third-party products to fill in the blank spots in their LTE portfolios.

According to a report published on Thursday, the market opportunity for third-party software written for cellular infrastructure will increase by about a billion dollars by mid-2010.

Startups bear all of the development costs and risks involved in innovative products while primary contractors integrate the software into larger products and sell it as their own, said ABI Research senior analyst Nadine Manjaro, the author of the report.

For startups and others, getting a piece of such a high-profile contract as Verizon’s is cause for celebratation.

“The timeline is great for us because we decided very early to invest in LTE in such a way that we could be part of the early trials and deployments of LTE,” said Todd Mersch, product line manager at Continuous Computing.

San Diego, California-based Continuous Computing is an 11-year-old company that specializes in a traffic management technique called deep packet inspection (DPI).

DPI traffic management is well-established in the wireline world. But in the wireless world and the emerging world of LTE, it is an area of innovation well suited to a smaller company.

Continuous Computing would not say whether it has a role as a third-party supplier in the Verizon Wireless contract, but its maturity makes it a likely participant.

“We’ve been through the telecom nuclear winter and through 2G and 3G and having made those transitions time and again, I think we get the attention of the larger players,” Mr. Mersch said.

by Cassimir Medford

via Startups Welcome Wireless Technology – RedHerring.com.

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