Tuesday, July 3, 2007

Discussion 2

Let’s analyze the future of UMTS in another sense. UMTS provides many services which may be collected under four topics.

1. Conversational class (voice, video gaming)
2. Streaming class (multimedia, video on demand, webcast)
3. Interactive class (web browsing, network gaming, database access)
4. Background class (email, SMS, downloading)

Each class will have different amount of demand. The first class was already in 2G, has been improved until its ultimate level so far. According to me, the other three classes will attract attention. Before UMTS was launched, video telephony was thought to be the killer application. Nevertheless, this was not the case in Japan. I think the reason is simple. People make video calls when they are in a private place, when they are alone. Making a video call in public is not really appealing, unless for extremely self-confident people. In addition to that mobile devices are usually used for urgent needs, for instance if you have to call someone and you are at home, you would make a video call with your laptop. But if you are on the bus at that instant, you would make a short call via cell phone. If you are at work, the situation is the same; it is not very pleasant to spend more than a few minutes for phone calls. This rule applies for the other classes also. Personally, web browsing or database access are not features I am desperately looking for in a mobile device. Because, if I have to do a research on web, I would prefer to do it when I have spare time, at office or at home, the places I can use my computer as well. Web browsing may only be used for urgent needs, when you forget the address you are leading to or you have to make a phone call and don’t remember the number. On the other hand I suppose email service will be a success, like SMS, which was also the case in Japan. Email is suitable for mobile services, doesn’t take a lot of time, responds critical needs. Even at vacation where you may not have computer and internet access, you may want to check and reply emails regularly. This is the same when you are traveling. Another application which takes time, downloading, is a different category. It will be triumph definitely. It takes time but in a diverse way than web browsing or video call. When downloading starts once, user doesn’t have to concern anymore, until process finishes. Music, video downloading is a huge market in fixed devices; it will be the same in mobile also. Network gaming is also time consuming; however gamers would certainly like the idea of being able to play wherever they want.

In summary; class one does not seem to progress anymore; class two may improve slowly however it will not be the killer application; third class achievement will not be massive except network gaming and the last one fourth class is going to be the killer application in my opinion. If we consider UMTS as a family of standards which is capable of all these classes, then standards for first and second classes will slightly change, third class will attach more importance to gaming, fourth class will go on evolving.

Sunday, July 1, 2007

Discussion

What will happen to UMTS? Let’s start with the obstacles it has encountered so far. Firstly, roll-out of 3G networks was delayed in some countries by the enormous costs of additional spectrum licensing fees especially in Europe although Europe has the biggest potential for UMTS with its all GSM infrastructure. It was like paying a huge tax in advance, due to potential income of 3G. For instance in Germany, 50.8 billion euros for six licenses. Moreover, UMTS itself is incompatible with GSM. UMTS phones sold in Europe (as of 2007) are UMTS/GSM dual-mode phones in order to make and receive calls on regular GSM networks as well. In addition to that mobile operators have to build entirely new networks because of new frequency spectrum used by UMTS. As a result, it is very expensive for existing GSM operators to switch to UMTS because of license fees and constructing new networks.

Secondly, UMTS is not compatible with its rival, CDMA2000. It uses different spectra. On the other hand, CDMA2000 is backward compatible. The UMTS spectrum allocated in Europe is already used in North America, also. Regulators in North America had to implement UMTS in different frequencies. Besides, W-CDMA uses a pair of 5 MHz channels whereas competing CDMA2000 uses 1.25 MHz channels for each direction of communication. UMTS and other W-CDMA systems are widely criticized for their large spectrum usage, which has delayed deployment in countries that acted relatively slowly in allocating new frequencies for instance US. Consequently, markets are usually taken over by one of the standards. Some markets like Europe, Japan are dominated by UMTS whereas many other big markets like US, Canada, India are dominated by CDMA2000 and because of the frequencies used, early models of UMTS phones designated for the US will likely not be operable overseas and vice versa.

Of course, we can not say that future is completely dark for UMTS. In Japan, first country that introduced 3G, 43% of wireless communication is UMTS now. Fast internet, especially email, music/video streaming had attracted a lot of attention. Despite incompatibilities with existing air-interface standards, the late introduction of this 3G system, and despite the high upgrade cost of deploying an all-new transmitter technology, W-CDMA has been adopted and deployed rapidly, especially in Japan, Western Europe and Asia. Moreover, although there is still one operator in US using W-CDMA, growth rate is significantly high. Eastern Europe is also catching up with western part rapidly. UMTS leaders such as Ericsson, is taking part in countries like Argentina, Malaysia (From “Recent News” part). Therefore UMTS has achieved to appeal customers with its services and despite the disadvantages it keeps on growing.

To sum up, UMTS will definitely take over existing GSM networks in the following years in my opinion. Because customers are interested in sending emails, downloading music with whenever they want… The question is: Is it going to be as fast as GSM? I don’t think so. Video telephony didn’t attract a lot of attention in Japan, and music downloading is not really vital. Japan is actively involved in 3G for the last six years but still more than half of the population is satisfied with GSM only. So, UMTS will come but it will be as slow as a regular technology instead of being an exception like GSM. The other question is about financial benefits of UMTS operators. Until now, they have paid enormous license fees for the markets they had biggest hopes for; such as Europe. In addition to that CDMA2000 has taken over some other world markets such as North America, India. China will probably give priority to its own standard, TD-SCDMA. UMTS is active in these markets but it seems that it has missed the chance to hold dominion; UMTS will be minority in these areas forever. As a result, UMTS operators are not even close to earn as much money from UMTS as they did in GSM.

Saturday, June 30, 2007

UMTS Technology in the Future

So far the UMTS technology in Europe has primarily been used in very similar terminals as the GSM technology. The UMTS terminals have been very closely linked with GSM phones in Europe. This factor is now slowly starting to change. Other than this change, what will be the improvements in the upcoming years?

3GPP LTE (Long Term Evolution) is the name given to a project within the Third Generation Partnership Project to improve the UMTS mobile phone standard to cope with future requirements. Goals include improving efficiency, lowering costs, improving services, making use of new spectrum opportunities, and better integration with other open standards. The LTE project is not a standard, but it will result in the new evolved release 8 of the UMTS standard, including mostly or wholly extensions and modifications of the UMTS system. It plans to move UMTS to 4G speeds of 100 Mbit/s down and 50 Mbit/s up, using a next generation air interface technology based upon OFDM.

Recent News

1. QUALCOMM and Sagem Communication Sign WCDMA Subscriber Unit License Agreement
Wednesday, 06 June 2007
http://www.qualcomm.com/

QUALCOMM Incorporated, a leading developer and innovator of advanced wireless technologies and mobile data solutions, today announced that it has entered into a WCDMA subscriber unit license agreement with Sagem Communication (SAFRAN Group). Under the terms of a royalty-bearing agreement, QUALCOMM has granted Sagem Communication a worldwide license under its patent portfolio to develop, manufacture and sell 3G WCDMA subscriber units at QUALCOMM’s standard worldwide royalty rates.


“QUALCOMM is pleased to license its patented technologies to Sagem Communication, enabling yet another European company to compete in the dynamic and rapidly growing opportunities for 3G WCDMA products,” said Marvin Blecker, president of QUALCOMM Technology Licensing. “We are quite pleased that QUALCOMM’s proactive licensing business model continues to enable new entrants to introduce exciting new 3G WCDMA products, providing operators and consumers with increasing choices among a large array of product offerings at all price points.”

2. Ericsson to deliver 3G/HSPA network to Personal in Argentina
Thursday, 07 June 2007
http://www.ericsson.com/

Ericsson is building an HSPA-enabled 3G network for leading Argentinean operator, Personal. Ericsson will also expand and modernize Personal's existing network with its Mobile Softswitch solution.

Under the agreement, Ericsson will provide new 3G/HSPA core and radio networks, including the Mobile Softswitch. Ericsson will also be the prime-integrator for the network and will provide business consulting services.

Ericsson's HSPA technology solution will enable Personal to break through with a new generation of mobile broadband services, delivering true broadband speed. Personal subscribers will also enjoy a richer communication experience.

Ericsson's Mobile Softswitch solution will help Personal to minimize their operating expenses through evolution towards an all-IP core network.

Marco di Costanzo, Mobile Network Director, of Personal Argentina, says: "Ericsson's state-of-the-art technology and experience in 3G/WCDMA/HSPA systems will allow us to provide a best-in-class end-to-end customer experience. It will also enable us to make a giant leap forward on the Argentinean mobile broadband market enabling new multimedia services delivery"

Daniel Caruso, Executive Vice President, Ericsson Argentina, says: "We are pleased and honored to be Personal's partner in transforming and expanding its network, enabling mobile broadband and the multimedia era and we look forward to continue our strong long-term relationship."

Ericsson's HSPA solution enables already today download speeds of up to 14.4Mbps and upload speeds of 1.4Mbps. The advanced technology lets operators more than double their system capacity and cuts response times for interactive services. On average, users will be able to download 20 times faster than with a GSM/GPRS connection. Future evolution steps will increase the HSPA download speed to 42Mbps and the upload speed to 12Mbps. Ericsson offers HSPA support on many frequency bands ranging from 850MHz to 2.6GHz.

3. Ericsson to expand and upgrade Maxis WCDMA/HSPA network in Malaysia
Wednesday, 20 June 2007
http://www.ericsson.com/

Ericsson has been selected by Malaysia's leading mobile operator, Maxis Communications Berhad (Maxis), to expand and upgrade its WCDMA/HSPA network enabling the operator to provide wireless residential broadband services to major cities and towns on mainland Malaysia.

Under the agreement, Ericsson will supply, integrate and deploy radio access network equipment and deliver radio optimization services. The contract includes Ericsson's latest HSPA software, enabling speeds of up to 14.4Mbps in the downlink and up to 1.4Mbps in the uplink, allowing Maxis to enhance its broadband service quality and speed. Implementation has commenced and is scheduled to be completed by the end of the year.

End users in areas that were previously without broadband access will be able to experience high-speed internet connections allowing seamless downloads of audio, video and large files.

Jon Eddy, Chief Operating Officer at Maxis, says: "We are aiming to expand our broadband footprint through this high-quality network while also supporting the government's national broadband plan. Maxis broadband is now widely available in Klang Valley, Penang and Johor Bahru. By extending our broadband services to more areas, we can address the shortage of residential broadband access while making broadband affordable and reliable. Ericsson is a strong partner in helping us to realize these ambitions, including our aim to become a major broadband player in the country."

Krishna Kumar, President of Ericsson Malaysia, says: "Ericsson is proud to support Maxis and believes that the HSPA network providing wireless residential broadband will play a significant role in meeting broadband access needs in Malaysia. HSPA provides the fastest and most cost-effective solution for operators that want to offer broadband services and will deliver end users an enhanced experience with competitive pricing."

UMTS vs. CDMA2000 in Markets

UMTS, CDMA2000 and TD-SCDMA are the most widely accepted 3G standards. TD-SCDMA was constructed by People’s Republic of China. In my opinion, it will not be able to enter world markets other than China. Europe is fond of its own solution, UMTS and USA is mostly dominated by CDMA2000. I think the race will be between UMTS and CDMA2000 in the coming years. Thus, I would like to compare the current situation of these two.

Right now, there are 461 million 3G subscribers. Approximately 120 million of these use UMTS. The rest is using CDMA2000 1x or CDMA2000 EV-DO. The increase in number of subscribers since May 2006 can be seen below. The graph is from 3G Today, page was updated at 30 April 2007.




CDMA2000 has nearly three times subscribers than UMTS has. USA has only one operator using UMTS and the rest of them uses CDMA2000. China has two operators that launched CDMA2000 whereas UMTS couldn’t take place in China market so far. In India, another big market, situation is not different. There are six CDMA2000 operators, and no UMTS. To put it differently, there are 391 3G Operators in 135 Countries worldwide. 157 of them are using UMTS where the rest uses CDMA2000.

Of course, UMTS has the leadership in some areas like Europe or Japan. The graphs in previous blog “UMTS Nowadays” proves that. In Japan, 3G leader, there are four 3G operators, only one uses CDMA2000. Another country going ahead, Italy, has four operators, none of them uses USA based standard.

Even though Europe and Japan are keen on UMTS, it seems that biggest markets have already been conquered by CDMA2000.

UMTS Nowadays

At this point, let’s take a quick look at how UMTS is doing right now.

Global W-CDMA Subscribers: 115,216,331
Global HSPA Subscribers: 1,377,603


WCDMA Subscibers (million):


Percentage Split of WCDMA / HSPA Connections by Region:

This graph demonstrates that Westen Europe has the highest percentage in WCDMA connections. On the other hand, USA/Canada is on the forth place with a very low percentage (2%). Does it really mean that Europe is beyond USA in 3G? In fact not... Europe invests on WCDMA because it the successor of GSM. North America prefers CDMA2000 because it is compatible with older CDMA telephony methods. AT&T is still the only operator in USA which prefers WCDMA, whereas there are approximately 40 operators using CDMA2000.

Top Ten Countries Ranked by WCDMA / HSPA Penetration:

Top Ten Operators Ranked by WCDMA Connections:


When we examine WCDMA penetrations in countries individually, instead of regions; we observe that Japan and Italy has the first two rank. Japan seems to be dedicated to be the number 1 in world in 3G. They will not miss the chance this time since it was the case in 2G. Italy operators occupies three ranks in the first five of the above graph as well.

Top Ten Operators Ranked by WCDMA Growth Rates (Quarterly):

Growth rates of WCDMA has a different structure than previous graphs. Japan or Italy is not in the list this time. Spain, Kuwait, Malta etc. prove that they will catch the leading countries soon.

Regional WCDMA / HSPA Growth Rates (Year on Year):

USA has the highest growth rate in region list altough WCDMA connections percentage is not high right now. This graph is a nice demonstration to show that WCDMA can keep up with CDMA 20000 in USA soon. Moreover, Europe Eastern is likely to get closer to Europe Western rapidly.

The first graph is from 3G Today, it was updated on 30 April 2007. The rest of the graphs are from UMTS forum. Forum page was updated on 30 June 2007.

Friday, June 29, 2007

UMTS implementations

Right now, there are 391 commercial 3G Operators in 135 Countries worldwide. 157 of them are using UMTS (From 3GToday). The story behind implementation of some operators can be found below.

Europe

In Europe, the license process resulted in some extremely high prices being paid, notable in the UK and Germany. In Germany, bidders paid a total 50.8 billion euros for six licenses. It has been suggested that these huge license fees have the character of a very large tax paid on income expected 10 years down the road - in any event they put some European telecom operators close to bankruptcy (most notably KPN). Over the last few years some operators have written off some or all of the license costs.

The first UMTS network in Europe was launched by Manx Telecom on the Isle of Man (a large island in the Irish sea) in 2001. Manx Telecom is part of the O2 group, which is now a subsidiary of Telefonica. O2 used the island as a testbed for 3G technology.

The 3 service was launched in the UK and Italy in March 2003. To meet this early date, this was a soft-launch with limited coverage of the UK initially available.

In December 2003, Mobitel has launched UMTS in Slovenia. T-Mobile launched UMTS in Austria, and began trials in the UK and Germany. Also, in November 2005 the T-Mobile UMTS network in the Netherlands went live (however, this was not a commercial launch, but meant to meet regulatory requirements imposed upon the spectrum auction).

In February 2004, Vodafone began a wide-scale UMTS launch in several European markets, including the UK, Ireland, Germany, The Netherlands and Sweden. In Portugal, UMTS was launched just before the Euro 2004 began.

In April 2004, VIPnet and T-Mobile launched UMTS in Croatia.

In Spain, the first operator to kick-off full 3G services was Amena on November 2004, although "early adopter" test were already in place in the country.

The first UMTS network in Poland was launched in 2004 by Plus GSM, but coverage was still limited to Warsaw. In April 2005, Era GSM launched another UMTS network in Warsaw, providing cheap (about 20 euros per month) internet access, among other 3G services. In January 2006 most of top major cities are covered by Era GSM, Orange and Plus GSM.

In Finland, UMTS licenses were provided by the government free of charge. In 2004, Elisa Oyj and TeliaSonera began deploying commercial UMTS networks, and in 2005 Dna Finland began commercial UMTS service.

In Serbia, UMTS was launched on 22 November 2004 by mobile operator Mobtel (now Telenor) but not for commercial purpose - testing only, commercial usage started 27 December 2006 and it was purchase by Mobile telephony of Serbia (Mobilna telefonija Srbije). Officially commercial use of UMTS 3G network in Serbia started with video conversation between Serbian Prime Minister Vojislav Kostunica and singer Zdravko Colic. It is estimated that at that time Mobile telephony of Serbia had ~80,000 users with UMTS capable mobile devices. Telenor Serbia (ex Mobtel) started with commercial usage of UMTS after 2 years testing period on 1 March 2007.

The mainly used UMTS network in Russian Federation is Skylink, which is mostly used by people who spend a lot of time in countryside, in poor GSM coverage areas. Since double format compatible phones appeared in Russia not so long ago, the Benefon UMTS mobile phones are also distributed by Skylink.

North America

The UMTS spectrum allocated in Europe is already used in North America. The 1900 MHz range is used for 2G (PCS) services, and 2100 MHz range is used for satellite communications. Regulators have however, freed up some of the 2100 MHz range for 3G services, together with the 1700 MHz for the uplink. UMTS operators in North America who want to implement a European style 2100/1900 MHz system will have to share spectrum with existing 2G services in the 1900 MHz band. 2G GSM services elsewhere use 900 MHz and 1800 MHz and therefore do not share any spectrum with planned UMTS services.

Initial rollout of UMTS in Canada is handled exclusively by the 1900 MHz band. T-Mobile's roll-out of UMTS in the US will focus on the 2100/1700 MHz bands just auctioned.

Under a previous agreement with NTT DoCoMo, US provider AT&T Mobility (formerly Cingular, and at the time of the NTT deal was the original AT&T Wireless) was required to build and market UMTS networks in four major United States cities by the end of 2004. At CTIA 2004, Cingular announced that their 3G network would be a 1900 MHz only implementation of UMTS and would launch by the end of that year as planned. However, since then they have chosen to deploy on 850 MHz and did not release any 1900 MHz-only devices. As of August 2006, Cingular has deployed UMTS/HSDPA networks in 17 U.S. markets covering 52 cities. Markets include New York (NY), Albuquerque (NM), Austin (TX), Baltimore, Boston, Chicago, Dallas, Detroit, Houston, Las Vegas, Los Angeles, Miami, Phoenix, Philadelphia, Portland (OR), Salt Lake City, San Diego, San Francisco, San Jose (CA), Seattle, Tacoma, Washington, D.C. and the metropolitan area of Puerto Rico, San Juan.

Roll-out in the US has been limited by a lack of suitable spectrum until recently. The FCC auctioned spectrum in the 1750 and 2150 bands , and at least one winner, T-Mobile, has announced a roll-out of a national UMTS network on these frequencies starting in 2007.

Previous US roll-outs have suffered due to lack of spectrum, requiring the sharing of the 850 MHz and 1900 MHz bands allocated for cellular communication in the US with existing 1G and 2G networks. The UMTS requirement for 5 MHz frequency slots, much larger than that required for existing networks, can create difficulty for US operators as many are only licensed for 5 MHz in each direction in certain areas, and as such cannot run both their existing system and UMTS in the areas affected.

Because of the frequencies used, early models of UMTS phones designated for the US will likely not be operable overseas and vice versa; other standards, notably GSM, have faced similar problems, an issue dealt with by the adoption of multi-band phones. Most UMTS licensees seem to consider ubiquitous, transparent global roaming an important issue.

Africa
The first UMTS network in Africa was launched on the island of Mauritius in November 2004. In South Africa, UMTS was launched in December 2004 by Vodacom followed in June 2005 by MTN. Namibia launched UMTS in December 2006, making it the 3rd Country in Africa to launch 3g services. While Globacom Nigeria is underway to going 3G, Starcoms Nigeria has already flooded the Nigerian Market with Sim enabled 3G fixed wireless phones.


The Middle East
UMTS/HSDPA services are being offered by many operators in the Middle East, mainly in United Arab Emirates, Kuwait, Saudi Arabia, Qatar and Bahrain. In 2006, the first UMTS/HSDPA license was awarded to ETISALAT Misr in Egypt. A second license was purchased by Vodafone Egypt in 2007 to enable them to launch the service immediately after the launch of Etisalat Misr's 2G/3G Network.

The Middle East operators are using the primary 2.1 GHz band for the UMTS/HSDPA operation.


Asia and Pacific
In Singapore, Singapore Telecommunications started their trial during December 2004 and it was successfully launched during March 2005 followed by StarHub and MobileOne.

In Malaysia, Maxis Communications started offering UMTS 3G services in February 2005 utilizing the 2.1 GHz UMTS band. Rival telecommunications company Celcom followed suit in a few months later also on the same band. Initially only offered as an option to postpaid customers, by early 2006 both telcos were also offering 3G to prepaid customers.

In the Philippines, UMTS was launched in 2006 by SMART and shortly thereafter by Globe.

Indonesia 3G era began when the government granted 3G licenses to the top three cellular operators: Telkomsel, Excelcom and Indosat. On 14 September 2006, Telkomsel launched its 3G service, followed by Excelcom XL3G on 21 September 2006. The XL3G offers 3G service in 6 major cities (Jakarta, Medan, Batam, Bandung, Surabaya and Denpasar) and allows international 3G roaming to Malaysia, Singapore, Hong Kong and Australia. Other than the first widest 3G service, XL3G also claims the title of the first fastest 3G service in Indonesia, as it offers high speed data access using HSDPA technology.

Government of India is currently evaluating the process of 'Spectrum Allocation' for 3G services. The final decision on the same is to be announced by end Q1 2007. The most likely mode is auctioning of 3G spectrum with a reserve base price. Commercial launch is only expected in 2008.

In Taiwan, Far Eastone launched its WCDMA-based 3G service on July 13 2005, offering 3G services offered by NTT DoCoMo in Japan. Chunghwa Telecom followed suit on 26 July 2005, using a WCDMA 3G network deployed by Nokia. Other local carriers offering 3G services include Taiwan Cellular Corporation and VIBO Telecom.

In South Korea, SK Telecom and KTF both operate UMTS/HSDPA networks since 2006. KTF (and possibly also SK Telecom) use the 2.1 GHz band which allows the use of European GSM/UMTS phones by travelers in case there is a roaming agreement in place between KTF and the home operator of the traveler.

Australia
Telstra has rolled out a UMTS network in Australia under the brand Next G in the 850 MHz band that will eventually replace the Telstra CDMA network and enhance its existing 2100 MHz UMTS network in October 2006. The 850 MHz band uses HSDPA and it will allow better coverage in rural areas where there are greater distances between subscriber and base station. This network covers a claimed 98% of the Australian population. As current phones on the market do not support the UMTS 850/2100 bands, handset choices available to Telstra subscribers will initially be limited. 2G CDMA network is set to replace in February 2008.