Prospects for the Evolution of 3G and 4G

SUMMARY

High-Speed Packet Access (HSPA) and Multimedia Broadcast and Multicast Service (MBMS) bring important enhancements to W-CDMA networks. However, they do not match the capabilities of broadcasting technologies (such as DVB-H and MediaFLO) and broadband wireless access technologies (such as WiMAX and WiBro) in certain important aspects of mobile TV service delivery and Internet access. 3G may need a major leap in performance to remain competitive.

This report considers the options for the evolution of 3G W-CDMA networks, focusing on the forthcoming 3G LTE and 4G standards. It evaluates the realistic capabilities of 3G LTE, in terms of throughput, capacity, latency and cost per megabyte. By modelling a typical network, it quantifies the practical gains that will be achieved by 3G LTE and the service mixes that it will be able to support. It also evaluates the benefits of additional spectrum for 3G LTE, such as the IMT-2000 extension bands.

The report identifies clear actions for mobile network operators, equipment vendors and regulators, to seize the opportunities provided by the evolution of 3G networks.

Prospects for the Evolution of 3G and 4G answers your key questions:

• How far will HSPA and MBMS take mobile networks?
• What are 3G LTE and 4G and when will they be commercially available?
• What will 3G LTE realistically provide, in terms of capabilities, cost per megabyte and services supported?
• Will 3G LTE support an aggressive fixed-mobile substitution strategy, to compete with enhanced DSL services and IPTV? Can it provide a broad mix of mobile TV and video services?
• How well will 3G LTE meet mobile operator requirements compared with alternative technologies, such as DVB-H and WiMAX?
• What is the value of additional spectrum, for example from 3G extension bands and GSM spectrum refarming?
• What actions can operators take to seize the opportunities that 3G LTE offers?

TABLE OF CONTENTS

Summary

1 New service opportunities may drive further investment in wireless networks

2 There are several options for evolution beyond current W-CDMA networks

• 2.1 HSPA and MBMS enhance W-CDMA, but have limitations in supporting some services
• 2.2 3G LTE and 4G offer an evolution of W-CDMA networks, but could be disrupted by alternative wireless technologies
• 2.3 To achieve success, future wireless systems must appeal to mobile operators and satisfy broad commercial requirements

3 Some service opportunities demand more network capability than 3G HSPA and MBMS can deliver

• 3.1 The cost and latency of HSPA prevent mobile operators from taking full advantage of VoIP
• 3.2 Mobile TV and radio services could be highly popular, but delivery by 3G HSPA and MBMS has limitations
• 3.3 Competing effectively with fixed Internet and IPTV services requires substantially more capability than available with 3G HSPA
• 3.4 Other data applications could also tax the capabilities of HSPA
• 3.3 Enhanced in-building coverage is a key requirement for mobile operators cultivating fixed mobile substitution
• 3.3 Future systems must take account of uncertainty in future service demand by supporting different network requirements

4 3G LTE will benefit greatly from OFDM, MIMO and more spectrum

• 4.1 The capability of W-CDMA networks could be improved in a number of different ways
• 4.2 OFDM and MIMO could increase HSPA throughput and capacity fourfold to match the spectral efficiency of WiMAX
• 4.3 Extra spectrum could be exploited to substantially boost the throughput and capacity of 3G LTE
• 4.4 3G LTE could achieve significant performance improvements
• 4.5 With a simpler, flatter network architecture, 3G LTE latency could be 20ms or less

5 3G LTE could deliver a compelling service mix, within its performance boundaries

• 5.1 Modelling the traffic demands of different service mixes against the capabilities of 3G LTE reveals a number of opportunities
• 5.2 3G LTE could enable valuable new service strategies, but operators must not overlook current opportunities

6 Costs and timescales will be critical to the success of 3G LTE

• 6.1 3G LTE could match the performance of alternative wireless technologies and offer cost and risk advantages
• 6.2 Timescales will be critical to the success of 3G LTE
• 6.3 Mobile operators need to decide what (if anything) they want to do with 3G LTE
• 6.4 3G vendors need to increase momentum behind 3G LTE, which is relatively little known compared to WiMAX and DVB-H

Actions

List of figures and tables

Figures and tables

• Figure 3.1: Nominal bandwidth of a variety of VoIP codecs
• Figure 3.2: Capacity of typical W-CDMA and HSPA networks (with approximately 10 000 base stations) to carry TV and video content
• Figure 3.3: Impact of monthly pricing and usage on revenue per megabyte for HSPA Internet access
• Figure 3.4: Potential impact versus level of uncertainty surrounding deployment of consumer services that could be supported by future wireless networks
• Figure 4.1: Estimated downlink throughput for basic W-CDMA, HSPA and 3G LTE networks, in a number of environments
• Figure 4.2: Estimated downlink network capacity of a typical mobile network for basic W-CDMA, HSPA and 3G LTE
• Figure 4.3: Typical cost per (downlink) megabyte for basic W-CDMA, HSPA and 3G LTE
• Figure 5.1: Evolution of total network downlink traffic for a typical mobile operator adopting a variety of service strategies, 2006-15
• Figure 5.2: Breakdown of network downlink traffic for a typical mobile operator adopting a variety of service strategies, 2015
• Figure 5.3: Relative cost per minute of VoIP on different wireless technologies, compared to 3G Release 99 circuit switched voice
• Figure 6.1: The business case for 3G LTE deployed for different service strategies
• Table 0.1: Estimated throughput, capacity and access cost per megabyte for 3G, HSPA and 3G LTE for a modelled 10 000 base-station network deployment
• Table 2.1: Evolution of capabilities from basic W-CDMA
• Table 2.2: Summary of options for evolution of wireless systems beyond 3G
• Table 2.3: Summary of 3G LTE requirements expressed by mobile operators at the 3GPP Long Term Evolution Workshop, Toronto, November 2004
• Table 3.1: Consumer services that could be supported by future wireless systems
• Table 4.1: Throughput, capacity and access cost per megabyte for 3G, HSPA and 3G LTE
• Table 5.1: Summary of modelled service mixes
• Table 5.2: Breakdown of network downlink traffic for a typical mobile operator adopting a variety of service strategies, 2015