Microwave Journal
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Cellular Infrastructure Manufacturers to Face Tough 18 Months

December 1, 2002

The total worldwide count of analog, CDMA, TDMA, GSM, PDC, PHS and UMT base stations will grow at a compound annual growth rate (CAGR) of a mere 13.7 percent through 2006, according to In-Stat/MDR. The high tech market research firm finds that, during this same period, UMTS will lead the growth with 110 percent, with CDMA and GSM expected to come in at a not so very close second and third. All other air links will experience either flat or negative growth.


According to Ray Jodoin, director of In-Stat/MDR's wireless research group, "Over the next 18 months, there might be significant short term delays due to equipment shortages and problems, as well as a significant lack of funding.

In addition, a considerable infrastructure manufacturer retrenchment will also occur, and could lead to additional delays because of the necessity to renegotiate contracts." In Stat/MDR also reports that, one year from now, a minimum of two infrastructure manufacturers, in each major market, will no longer be in business and that significant carrier consolidation will also occur during this period.

"While the forecast indicates year-to-year growth, 2002 and 2003 should be viewed as extremely volatile," says Jodoin. "If the carrier CAPEX continues to slip, 2002 and 2003 new base station deployment will be down considerably from initial forecasts."

In-Stat/MDR has also found that:

  • In 2006, there will be only two major air links deployed on a worldwide basis; CDMA at 20.8 percent share of the market (SOM) and GSM at 69.2 percent SOM. UMTS will have only a 4 percent SOM at that time.
  • GSM will dominate with almost 94 percent of deployed European base stations in 2006. However, previous rapid growth is beginning to ebb as subscriber growth diminishes.
  • Base station developments in the US will experience a dramatic decline in 2003 as a result of not only the new order downturn that occurred in 2002, but also an anticipated delay in the change over from TDMA to GSM. While activity will occur throughout 2003, systems will not be operational until early 2004.
  • Unlike North America, Latin America is expected to continue to depend heavily upon analog and TDMA through 2006. Unless there is a radical transitioning of TDMA to GSM-850, CDMA will be the primary air link at the end of the forecast period in Latin America.
  • While PDC will still dominate the Japanese landscape in 2006, NTT DoCoMo and J-Phone will be making rapid market advances with UMTS. Based on current plans, all CDMA deployments will be upgraded to at least 1xEV-DO in order to offer direct competition to UMTS data speeds.