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  • AIRCOM: LTE Not the Only Option for Mobile Operators Today

    Deployment of HSPA+, set to save operators from costly CAPEX investment, deliver five times current network performance and open up new pricing models, says AIRCOM.

    In its recent analysis, AIRCOM, a network planning and optimisation company, highlights why HSPA+ could make short-term commercial sense to a wide range of 3GPP operators contemplating their mobile broadband network migration strategies. ROI (return on investment) and new pricing models are the key factors.

    According to Aircom, as operators continue to address the rapidly increasing demand for mobile data, further attention and financial investment has been committed to upgrade existing network infrastructure. “With peak download speeds above 100 Mbps being suggested, LTE has been widely hailed as the panacea for operators’ congestion troubles,” as the analysts say.

    Based on analysis of network infrastructure requirements, AIRCOM identifies HSPA+ as a compelling alternative for operators’ mobile broadband strategies.

    Available today, the technology offers up to 21Mbps without any additional antenna infrastructure or second carrier – allowing users to experience mobile broadband around five times faster than the current average of 3.6Mbps.

    HSPA+ also allows mobile operators to control service provisioning and prioritisation, delivering Quality of Experience (QoE) and Quality of Service (QoS) guarantees.

    “Fundamentally, deployment of HSPA+ offers significantly reduced CAPEX investment compared to LTE. Reduction for a UK operator could be as much as £345 million in 12 months; as much as $1.19 billion for a US operator,” claims Aircom.

    AIRCOM Services Director, Fabricio Martinez, responsible for providing the industry with the ‘cost of LTE’ reality check in late 2009, said: “There is great pressure on operators to upgrade their networks and improve the level of service they deliver to consumers and enterprise customers. The so-called ‘iPhone effect’ is piling pressure on to existing infrastructure. There is a real and immediate need for operators to upgrade their networks, but LTE is not the answer – today at least.”

    HSPA+ is able to meet – and exceed – current data demands, delivering a theoretical maximum of 21Mbps and an average experience of around 16Mbps. “With average mobile broadband users experiencing around 3.6Mbps, this is a significant increase,” said Martinez.

    According to him, the increase in speed enables operators to do two things: to combat price erosion, and to offer sophisticated service provisioning. “As operators are able to prioritise data traffic and users, QoE can be assured, data speeds can be controlled, and we will see a tiered pricing model emerge, mirroring the fixed line broadband business,” the analyst claims.

    He believes that the most important factor in deciding a future network technology is ROI. “Due to the low CAPEX investment and new revenue opportunities, deployment of HSPA+ will allow operators to see ROI in three years; perfect timing to upgrade to LTE, when that technology’s ecosystem has matured, devices have come to market, and equipment prices have reduced,” he said.

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  • AIRCOM Reveals the Economic Reality of LTE Migration

    AIRCOM International, the network planning and optimisation consultancy, revealed the economic reality of LTE migration facing mobile operators around the world – as much as US$1.78 billion for a tier one US operator in the first year.

    As the economic downturn puts pressure on credit markets, and mobile operators attempt to limit significant CAPEX commitments, AIRCOM says they believe that innovative approaches to LTE network roll out, network sharing for example, will be essential in ensuring the profitable delivery of future mobile services.

    LTE investments vary by region, the legacy equipment operators have in place and the spectrum they have available. However, AIRCOM estimates the total CAPEX investment facing a tier one mobile operator in the first year of roll out to be as follows:

    "With an all IP-based network infrastructure, LTE requires completely new thinking compared to previous mobile technologies. Mobile operators around the world face very different challenges in embracing LTE, which will have serious implications on the levels of finance they need to raise," said Margaret Rice-Jones, CEO at AIRCOM International.

    While raising capital in today’s volatile global financial markets continues to prove difficult, operators and supporting infrastructure vendors are struggling to find the necessary credit to support the necessary enhancements to their radio network, backhaul and core network infrastructures.

    Rice-Jones continues: "Very few operators have the available resources or shareholder freedom to meet these costs. This means that innovation within the mobile industry needs to be redefined. It has been traditionally tied to finding the next "killer application". The economic reality of the mobile industry now means that true innovation is finding technology that will enable operators to deliver services more cost effectively."

    AIRCOM believes mobile operators can embrace innovation in a variety of different ways. Most significantly, operators must accept that the techniques used to drive efficiencies and revenues with previous technologies will not be applicable to LTE.

    Mobile operators must therefore find new business models to monetise LTE, compared to subsidising handsets and offering free voice minutes in return for fixed-term contacts.

    The significant investment required for LTE deployment could also see mobile operators globally embracing network sharing as a means of reducing CAPEX and OPEX. Other innovative ways of lowering costs include the automation of key optimisation processes through the roll out of self-organising networks (SON) and the deployment of femtocells within a network to cost-effectively provide macro network offload capabilities as well as indoor coverage solutions.

    "Despite the financial commitment required, there can be no doubting the tremendous potential of LTE technology in taking mobile services to the next level," added Rice-Jones.

    "LTE represents a major evolution and mobile operators must take an intelligent approach to network migration. With careful planning however, LTE will deliver sufficient network capacity and data speeds to further enhance the delivery of high bandwidth services to consumers globally."