Operators urged to prepare for LTE whatever their deployment plans

Posted by Julian Bright Monday, March 2nd, 2009

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Preparations for LTE could help operators get the most out of their current networks while putting them in a good position to profit from next-generation technology, even if large-scale LTE rollout isn’t on their radar just yet.

Some in the industry are advising operators not to delay preparing their networks for LTE, whether or not they plan to deploy the technology soon. By carefully targeting their investment, they can lay the groundwork for LTE while reaping cost and performance benefits for existing technologies, such as HSPA, say commentators.

In the past month, a number of mobile operators have reviewed their LTE-rollout plans. At a 3Q08 results presentation in February, Vodafone CEO Vittorio Colao told analysts and investors that the company is in no hurry to roll out LTE, and Didier Lombard, chief executive of France Telecom/Orange, has reportedly said that a large-scale rollout of LTE across the firm’s territories was “unnecessary for at least a couple of years.”

Meanwhile, operators that are deploying LTE more aggressively have already been doing the groundwork. Teliasonera, which plans to launch LTE networks in Stockholm and Oslo in 2010, started to prepare its sites over a year ago, according to Mats Lundback, the operator’s head of technical development for mobility services.

Speaking at the Mobile World Congress, held in Barcelona last month, Lundback said that the operator was installing new antennas for LTE but that much of the equipment at its cell sites would be reused.

With many LTE rollouts over the next two years expected to be limited to hot spots in major urban centers, HSPA+ is likely to be used to provide additional capacity for existing HSPA networks. Vodafone’s Colao said that the operator was investing in HSPA to provide more speed in more places.

Bengt Nordstrom, of consulting firm Northstream, says the expanding market for HSPA, particularly in China and India, will mean low prices for HSPA infrastructure and devices. “Before LTE can compete with that and all the early problems with the technology are ironed out, we are into something like 2014,” he told Informa Telecoms & Media.

Nordstrom says it makes sense for operators to prepare for a fast rollout of LTE when it’s ready but refrain from making a commitment for now. Since LTE is not set to be a mature technology for another three to five years, continuing to build HSPA could help operators build a mobile-broadband-customer base.

Adrian Scrase, head of the 3GPP’s mobile competence center, told delegates in Barcelona that HSPA+ provides operators with a technology choice that can evolve and mature if they prefer not to go directly to LTE. He said that operators can achieve significant capex and opex savings in a number of key areas by migrating to LTE (see fig.).

One area of focus for operator lobby group the Next Generation Mobile Network alliance is the reuse of network assets for next-generation technologies. “The plan is that we wouldn’t build even one additional site,” Emin Gurdenli, head of radio networks at T-Mobile Europe, said in a speech at the Barcelona event. “That calls for a smooth migration [to LTE] so that we don’t have to write off the equipment we bought last year.”

Nordstrom suggests that operators can prepare sites for LTE by installing cables and new antennas, or by acquiring new sites for LTE if they need to do so. They can also experiment with small networks to learn radio planning and other design criteria for LTE, so that once LTE is ready they can roll it out quickly.

Vendors say that in addition to preparing existing sites and civil works for reuse, operators can save money by investing in areas such as RAN consolidation, upgrading backhaul capacity and migrating to an all-IP core network, which will both enable them to save money in running today’s GSM/UMTS/HSPA networks and bring the full cost and performance benefits of LTE when the time comes to implement it.

Gurdenli said that the drive by operators to reuse resources – through technology such as multistandard base stations – is putting pressure on vendors.

Tan Zhu, vice president of global wireless-product-line management at Huawei, which is supplying TeliaSonera’s Oslo network, said that LTE should provide coverage similar to or better than current UMTS networks by reusing cell sites and transmission networks. Even with LTE it would be difficult for operators to increase revenues, but they could decrease costs, Tan said.

He said that the use of a single converged RAN was important to help an operator achieve cost savings, as are site construction, network planning and optimization, and resource management extending across both existing networks and future LTE networks.

One operator that has already committed to a converged-RAN approach is Hong Kong-based CSL. China’s ZTE is replacing CSL’s 2G and 3G networks with a converged 2G/3G software-defined radio network that reuses the operator’s 2,000 cell sites. The converged network provides the platform for the operator’s soon-to-be-launched HSPA+ offering and will also be LTE-ready, according to ZTE.

The network uses CSL’s 900MHz frequency to provide a flexible configuration that is 60% GSM and 40% UMTS, said Richard Lihe Ye, senior director for business development at ZTE’s mobile division. The operator can transfer customers from GSM to UMTS as subscription counts rise and can upgrade to LTE via remote radio heads and new LTE cards for the baseband.

Another area where operators are focusing their attention is the core network. Verizon Wireless, which has said that it will launch LTE in 2010 and aggressively deploy it across its entire network, has been helping formulate the evolved-high-rate-packet-data standard for migration to a converged CDMA/LTE core network in 3GPP2, and it is working closely with vendors such as Alcatel-Lucent and Starent on its implementation.

Alcatel-Lucent’s president for EMEA, Adolfo Hernandez, said that his company did not know of any operator that had reduced its investment in IP transformation, and Mary Chan, president of 4G/LTE wireless networks at Alcatel-Lucent, said that operators did not have to wait for LTE deployment before starting to renovate their core networks.

According to Scrase, it is widely believed that implementing LTE without the associated core-network element – system-architecture evolution (SAE) – would be a waste of time. “The benefits will be lost if operators don’t implement SAE at the same time,” he said.

Gurdenli said that if the industry is to achieve its goal of reducing the cost of LTE equipment to one-tenth that of the previous generation of networks, opex has to come down in areas such as backhaul.

Ericsson’s product manager for LTE, Hanna Sibley, said that operators that had prepared their backhaul networks would be able to reuse much more of their equipment, and Nordstrom said that extra backhaul capacity is also required for HSPA, making it a natural area in which to invest.

Pragmatic approach

Nokia Siemens Networks says that overall, operators are taking a pragmatic approach to network development, though more of them are discussing LTE.

“It’s not a question of whether they go for it [LTE] this year or next year,” Marc Rouanne, head of radio access at NSN, told Informa. “There are a few that are doing that. But they know that maybe the following year they will need to have some kind of LTE, and the question is how they can do that at the same time as investing in their current needs.”

According to Paul Gowans, field-marketing manager for Agilent Technologies, the fact that operators are demanding test equipment that covers all wireless technologies from 2G to LTE is a clear indication that they want to hang on to legacy technologies for as long as possible while migrating to next-generation networks.

In the case of LTE, operators want to roll it out to existing base stations and have it running alongside other RAN technologies, Gowans said.

Rouanne also says there is a lot of demand from customers to extend the life of legacy networks, partly because of the economic downturn. “What they ask us for now is a holistic approach to the complete network, where they can look at refarming, load balancing and keeping the assets if they can,” he says. “It’s a much more pragmatic approach and a more smooth evolution of the installed base.”