NSN integrates the way to LTE but will downturn delay rollouts?

Posted by Mike Roberts Thursday, February 5th, 2009

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A release and webinar today by Nokia Siemens Networks suggests LTE equipment schedules are largely on track, but the economic downturn will play a more decisive role in operator deployment plans.

Mobile product development is often about squeezing more and more features into less and less space, whether for handsets or base stations. Nokia Siemens Networks provided an example today when it unveiled its Flexi Multiradio Base Station, which supports GSM/EDGE, WCDMA/HSPA/I-HSPA and LTE in one unit.

First impressions are it’s a step forward in integration that will smooth migration from GSM/EDGE and WCDMA/HSPA to LTE, but that sustained differentiation may be tough since other major vendors are on the same path.

In addition, more integrated equipment won’t change the fact that in the long run LTE will be a forklift upgrade involving new base stations (like the NSN Multiradio, as opposed to the older equipment making up the vast majority of installed base stations globally), new controllers/gateways, new base station antennas supporting MIMO, new core and backhaul equipment and new devices.

Operators won’t have to make all the investments at once, and they’ll reuse existing equipment and assets as much as possible, but there’s no getting around the fact that LTE/SAE is significantly different from existing mobile systems, and so will require significant investments.

This leads to the question of whether LTE deployments will be delayed due to the scale of investment involved and the economic downturn. Already some operators are reducing CAPEX guidance for 2009—for example AT&T recently estimated that its overall CAPEX would decline 10-15% in 2009.

So we put the question to Kai Sahala, head of radio access at NSN, during his webinar today detailing the new Multiradio Base Station. His reply was that he’s seen no evidence of operators delaying LTE plans—that they’re on track for early deployments later this year, and volume deployments in 2010. This is partly due to the need for more capacity to serve the mobile broadband traffic boom, and partly to stay ahead of the competition.

We can see that point of view, but a fly in the ointment is that a lot of HSPA operators can address both points by upgrading to HSPA+, and delaying the larger investment likely to be required for LTE. However this will only work for operators with enough WCDMA/HSPA spectrum to last for a few years. We’ll provide a detailed assessment in our upcoming Future Mobile Broadband report.

A footnote on the Multiradio Base Station is that it’s an upgrade of the Flexi Multimode Base Station that NSN launched in early 2008. The Multiradio product supported WCDMA/HSPA and added hardware support for LTE in late 2008 (with full support coming in second-half 2009 via a software upgrade). So the Multiradio product is effectively the Multimode product plus support for GSM/EDGE.

Today NSN also announced its Multicontroller, which aims to integrate the base station controllers from different technologies, including GSM’s BSC and WCDMA’s RNC. The Multicontroller will initially support RNC functionality but BSC support will be added via software. It’s designed to cope with the mobile broadband traffic boom by letting operators add capacity in steps up to a hefty 35Gbps.