Mobile Operators to Invest $18 B in UMTS LTE Networks by 2014
Long Term Evolution (LTE) of 3G technologies is about to benefit from Rel-8 of the 3GPP standard, planned for the third quarter of 2007.
This will be the trigger for development of components and systems to provide 100 Mbps download speeds to mobile devices. According to a new study from ABI Research, network operators will invest a total of almost $18 B in LTE capital infrastructure over the period to 2014.
This will yield a significant payoff, both in reduction of operating expenses and in the creation of new revenue from IP-based services.
“LTE faces competition from other broadband wireless technologies and it will need to demonstrate clear technical and economic advantages to convince network operators,” says ABI Research analyst Ian Cox.
“WiMAX has a two-year lead over LTE but suffers from not being backwards-compatible with current 3G technologies. LTE will not only be backwards-compatible with UMTS but is likely to be used to upgrade CDMA networks as well.
But the industry is also working on HSPA+, which could offer the same performance in a 5 MHz bandwidth. Without additional spectrum, operators face a difficult choice.”
Cox further comments that, “The industry is also making progress in avoiding intellectual property rights is sues in the new standard. Next generation mobile networks (NGMN) have been set up by leading operators to ensure a level playing field.”
For users, says Cox, LTE will enable broadband services, including VoIP, to be offered over SIP-enabled network. Each service will be IP-based, offering high data rates and low latency, with on-line gaming becoming a reality, along with mobile network data speeds comparable to those of fixed networks. For vendors, LTE will allow development of a new market to replace 3G revenues. For operators, an all-IP network with simpler, flat architecture will reduce operating costs and boost revenues.