- Language: English
- 110 Pages
- Published: January 2011
- Region: Global
Mobile Broadband: Impact on the Telecom Industry
- Published: August 2008
- Region: Global
- 60 Pages
4.4 billion Mobile subscribers around the globe by 2011, and the growing ubiquity of mobile broadband. This report provides analysis of the technological and economic issues surrounding mobile broadband that both operators and equipment manufacturers are having to contend with. It examines the solutions being rolled out by operators to spur the development of their mobile broadband offers.
- What opportunities and threats does mobile broadband create for operators and equipment manufacturers?
- What are the technical-economic issues involved in mobile broadband for operators?
- What are the key figures on the mobile data market worldwide?
- What technologies and infrastructure are already in place?
- Is there a consensus and convergence on innovations?
- How are equipment manufacturers positioned with respect to the different wireless access standards, and the corresponding markets?
1. Mobile broadband is already here
1.1. Services: 3G/3G+ promises and issues
1.2. 3G deployment
1.2.1. 3G infrastructure coverage
1.2.2. 3G Services: Europe and North America are catching up
1.3. Mobile data in the most advanced markets
1.3.1. Stabilising mobile ARPU in major markets
1.3.2. Growth in data services and ARPU
1.4. Mobile broadband: an opportunity and a threat for operators
1.4.1. Change drivers: regulation and strong competition
1.4.2. Opportunity for data ARPU
1.5. “Flat rate” data offers are growing
2. Technologies: time to choose
2.1. Operators’ expectations: performance, IPR, terminals and costs
2.1.1. Operators set the stage: the NGMN Alliance initiative
2.1.2. Gains and performance: speed and latency
2.2. Consensus on innovation
2.2.1. Technology convergence
2.2.2. Intellectual Property: primary owners and cost
2.3. Radio spectrum issue
2.3.1. Regulatory changes
2.3.2. Need for spectrum
2.3.3. Candidates for IMT Advanced and CMR 2007 bands
3. Opportunities and threats for equipment suppliers
3.1. Market for mobile equipment
3.1.1. The network equipment market remains at the centre of the mobile ecosystem
3.1.2. Market for terminals
3.1.3. Competition and concentration
3.2. Shuffling the cards during deployment of very high speed mobile broadband
3.2.1. Operators’ investments drive the equipment market
3.2.2. Transitions from one generation to another
3.2.3. TD-SCDMA: A competitor in the Chinese market
3.2.4. South Korea: WiBro development and contribution to various standards
3.3. 3GPP/LTE ecosystem dominates
3.3.1. LTE: the favoured choice of operators and equipment suppliers
3.3.2. WiMAX ecosystem: more restricted and dependent on Intel
3.4. SWOT Analysis for the various standards
4. Issues for operators: deployment schedules and the technical-economic equation
4.1. Growing capacity needs
4.1.1. Increase in the number of mobile broadband subscribers
4.1.2. Mobile data service capacity needs
4.1.3. Mobile Internet connectivity offers weigh on networks
4.1.4. Explosion of data traffic
4.2. Accelerated schedules
4.2.1. Latest generation mobile terminal distribution accelerates
4.2.2. New deployments required by 2012-2014
4.2.3. LTE Deployment: acceleration in Japan and in the United States, possible delays in Europe
4.3. Facing the increase in traffic: a technical-economic equation that operators can't solve?
4.3.1. One objective: reduce the cost of a transported Mb
4.3.2. Improvement in technology performance won’t solve everything
4.3.3. More spectrum for greater capacity: a limited medium term solution
4.3.4. Network densification: complicated and expensive
4.3.5. Femtocells and convergence between fixed and mobile networks: a promising solution that needs to make the grade
Summary of Tables
Table 1: Examples of mobile data services
Table 2: Number of UMTS (WCDMA/HSPA) networks deployed and planned - May 2008
Table 3: Largest 3G subscriber bases, 2005-2007
Table 4: Monthly ARPU for mobile services by geographic region, 2003-2007
Table 5: Selection of mobile broadband rate plans, by late 2007
Table 6: KTF iPlug rates (data offer - USB modem)
Table 7: SKT T-Login rates (data offer - USB modem)
Table 8: Summary of the NGMN Alliance primary performance expectations
Table 9: 3G, Super 3G and 4G characteristics
Table 10: Description of the primary cellular and wireless broadband technologies
Table 11: Factors influencing the IPR rate
Table 12: Estimated spectrum needs by 2020 for IMT-2000 and IMT-Advanced
Table 13: WRC07 Candidate bands for IMT-Advance systems
Table 14: Change in mobile terminals market share (by volume), 2002-2007
Table 15: Market share for GSM infrastructure
Table 16: Market share for WCDMA - HSPA infrastructure
Table 17: Market share for CDMA 2000 and EV-DO infrastructure, 2005-2007
Table 18: CDMA operators’ migrating to W-CDMA/HSPA
Table 19: TD-SCDMA main parameters
Table 20: LTE Ecosystem
Table 21: WiMAX ecosystem
Table 22: Strengths and weaknesses for 3G technologies
Table 23: Risks and opportunities for 3G technologies
Table 24: Estimates - Major mobile markets in number of subscribers by 2011
Table 25: Maximum and average required bandwidth for mobile applications
Table 26: Increase in data traffic and impact of connectivity offers in Finland
Table 27: Growth in mobile data traffic in Finland
Table 28: Internet and data traffic on mobile networks (2006-2012)
Table 29: Worldwide IP traffic (2006-2012)
Table 30: Estimated sales of 3G and 3.5G terminals, 2008-2011
Table 31: Estimated cost of transporting a Mb for HSPA and LTE technologies
Summary of Figures
Figure 1: 3G subscribers by geographic area, at the end of 2007
Figure 2: Mobile data services market by geographic region, 2007
Figure 3: Monthly voice and data ARPU from selected operators, 2007
Figure 4: Categories of fixed Web services
Figure 5: NGMN Alliance technical requirements
Figure 6: Maximum downstream speed by type of mobile technology
Figure 7: Convergence on technological changes
Figure 8: Contributors to 3GPP standards in 2006
Figure 9: Speed and channels for 3G and B3G technologies
Figure 10: Equipment supplier market share by segment, in late 2007
Figure 11: Mobile terminals market share (by volume), in late 2007
Figure 12: Revenue growth rate for equipment suppliers in the mobile infrastructure segment between 2006 and 2007
Figure 13: Operators’ investments in mobile infrastructure, 2005-2006
Figure 14: Routes to migrating 2G cellular networks to 3G/3G+
Figure 15: Terminal sales by region, 2002-2010
Figure 16: Estimates - Change in geographic distribution of mobile subscribers worldwide between 2007 and 2011
Figure 17: Mobile Internet browsing traffic profile
Figure 18: Estimate of mobile data traffic growth
Figure 19: Estimated sales of 3G and 3.5G terminals, 2008-2011
Figure 20: Deployment schedule and population coverage in Western Europe for HSPA, HSUPA and LTE
Figure 21: HSPA and LTE (macro cell) estimated spectrum efficiency
Figure 22: Monthly maximum capacity offered to users for data fixed rates
Figure 23: Frequency bands targeted by European telecom operators
Figure 24: Status of spectrum allocations for the digital dividend and for the 2.5 GHz band (worldwide)
Figure 25: Impact on the cost of Mb transported of assumptions for sharing existing masts for LTE technology
Figure 26: Value propositions for femtocell solutions and potential adoption by operators 2008 edition
Telecommunications equipment suppliers and operators see in mobile broadband the growth driver that is indispensable for their expansion. But implementing data services on mobile networks poses a series of both technical and economic problems for players in the ecosystem. In this study, we will analyse the issues in mobile broadband for these players, notably with services aimed at moving fixed Internet into a mobile environment.
Explosion in capacity needs and data traffic
Operators’ revenue from data services is growing rapidly. But the growth in capacity needs and data traffic are even stronger.
There are several reasons for this:
- increase in the number of mobile subscribers,
- increase in the share of 3G subscribers,
- specific impact of mobile Internet access services for lap top computers.
Operators must provision an average of 40 kbps downstream in peak times for a user who connects using his lap top computer on an HSDPA network, but only 0.3 kbps for a user connecting using a telephone type terminal.
In fact, operators who have developed mobile Internet access offers note that:
- mobile data traffic is increasing rapidly, even more so when mobile Internet access services for lap tops are expanded.
- Traffic generated from computers represents most of the mobile data traffic when attractive offers are available.
- The traffic profile generated by computers much larger than that generated by mobile telephones or smartphones.
Equipment suppliers and operators expect sustained and consistent growth in mobile data traffic in the years to come.
Resolving mobile broadband’s technical-economic equation
The increase in data service revenue generated by new mobile access services does not compensate for the very large increase in traffic noted by operators on their networks.
One of the operators’ greatest requirements is to reduce CAPEX and OPEX network costs. Operators increasingly prefer an overall approach consisting of reducing the cost of data transported (cost of an Mb transported).
The author has created a model for the specific case of an operator that already has a GSM network, deploying 3G in 2004 and LTE starting in 2012 (in high density areas). The largest cost elements are shown in the table below. It takes into account investment costs and operational costs associated with the core network, the information system and the radio access portion (including the costs of radio spectrum usage licences).
Improvements in technological performance
Economic conditions will improve as technology moves towards LTE. Nevertheless, the improvement seems less significant that the operators expected, within the NGMN Alliance, for example.
The relatively conservative hypotheses in our model may explain this perception:
- The LTE profile evaluated was not the most efficient of these expected.
- Savings in terms of OPEX are not available yet for LTE network deployments and were not included in our model at this stage.
- The model does not include deployment associated with LTE networks and LTE femtocells.
The model for deploying HSPA and LTE networks developed by the author highlighted the limits in terms of capacity available on HSPA networks by 2013. The problems with available capacity will appear in densely populated urban areas and, by 2014 in suburban areas.
Faced with these limits, operators could degrade the quality of their services (restricting available capacity, reducing speeds, etc.) or continue with their deployments.