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True drivers behind the LTE migration – wisdom of hindsight is always right

Key Words: LTE, Network Modernisation, 

Tomi LTE Barcca 2012_pic 1 for webPeter Drucker once said that the best way to predict the future is to create it.

Business leaders do spend most of their time in looking forward not looking backward. However, sometimes it is good to look back to see how right or wrong you have been given the information you had at that point of view – we call it wisdom of hindsight. In May 2011 Omnitele gave a presentation at LTE World Summit in Amsterdam. Topic of the presentation was: “True drivers behind the LTE migration – building a future proof LTE deployment strategy”.

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Omnitele statements:

  • LTE is not a miracle maker for mobile broad band but a clear step up and future dominant design
  • Real driver behind most LTE launches is competition – technical drivers for early LTE
    launch are not imminent in most markets
  • Operator has to plan and build LTE capability beforehand, and wait for the launch-drivers to trigger
  • Well prepared, proactive LTE migration saves money in long term

LTE deployment situation today:

  • By July 2012 LTE has been commercially launched in 45 countries and by 89 operators (source: GSA)
  • In May 2012 total number of LTE subscribers was 15M however majority of this was still in the US and Korea (source: Mark Newman, Informa Telecoms & Media at LTE World Summit 2012)
  • 800MHz and 1800MHz are emerging as leading ecosystems for LTE in Europe
  • A number of 800MHz frequency auctions will be taking place in Europe in 2012 and 2013 – so far we have seen a large variation within spectrum valuation from 0.3 to 0.81 euro/MHz/population. This can likely be explained by local market factors. (source: Analysys Mason)
  • In developed markets, mobile traffic will grow 34% CAGR from 2012 to 2017 however in developing markets mobile data traffic growth rate is slightly lower at 24% (source: Analysys Mason)
  • Operators address this growth of data traffic by deploying new base stations and refreshing aging base stations to be multi radio capable (i.e. supporting also LTE). Roughly 10% of base station deployments are expected to be network modernization cases (source: Analysys Mason)
  • Marketing approaches by operators do vary quite a lot – some operators are promoting HSPA+ (or HSPA+ with dual cell technology) networks as “4G networks” and some operators make a clear difference between HSPA+ and LTE (source: Omnitele market intelligence)

Conclusion: Prepare for Launch

For most of the markets Omnitele proposes building LTE capability in the network, but launching it widely only after technical reasons trigger is still valid. Mobile operators do have some core assets which they need to leverage – network, billing relationship with the customer, knowledge of their customer’s usage and spending patterns, capability to differentiate with quality of service provided. LTE itself is not one of these assets but does further enhance the above mentioned assets.