LTE Base-Station Reference Design by TATA-Elxsi, CommAgility and Radiocomp

Tata Elxsi, CommAgility, and Radiocomp have announced a collaboration to produce an LTE Macro/Micro base-station reference design. This is a significant milestone for an Indian product company at being able to contribute to complex engineering solutions. It is also a compelling example of collaboration between companies that bring complementary skills and are geographically diverse [TATA Elxsi: Bangalore, India, CommAgility: Leicestershire, UK and Radiocomp: Hillerod(Copenhagen), Denmark]. TATA Elxsi probably provided the L2/L3 software stack, CommAgility provided the DSP baseband and physical layer implementation and Radiocomp provided the Radio Head.
The challenge is to convert engineering design wins to commercial success and it is not always a given. For example TATA Elxsi reported a 10% net-profit-to-sales margin in Q2, 2010 with a profit of Rs 15 crores while its larger cousin TCS, which is primarily into services, reported a 24% net profit margin with a quarterly profit of Rs 2169 crores. Notwithstanding these challenges, let us celebrate this milestone in wireless engineering out of India.

Huawei's 3Tier Plan to Address Security Concerns in the US Telecom Market

It is well known that Huawei has been trying to expand its foothold on the US telecom market. It has existing business with Clearwire (http://www.cellular-news.com/story/39065.php), Alltel, Leap Wireless, Cox Communications, MetroPCS and some others. But it hasn't been able to secure wireless infrastructure deals with the Tier1 US operators. A part of this block has been attributed to security concerns in the US market in sourcing equipment from a Chinese vendor. Whether this is a valid concern or not it open to interpretation; but such curbs abound today where foreign participation is limited in certain industries. This means that not only Huawei but all the telecom infrastructure players that target a global footprint, have to develop country specific plans to allay the security concerns. The following is Huawei's published plan for the US/Western-European market:

• The establishment of a national security committee in the U.S., the U.K. and France. In the U.S., the committee will be headed by Matt Bross, Huawei's CTO, who lives in the United States.
• The opening up of certain software source codes in Huawei equipment so that they are accessible to third parties. This includes the hiring of third parties, such as accredited test lab EWA, to conduct auditing and testing.
• The trusted delivery of all products. Because the company's electronics supply chain is global, Huawei will offer trusted delivery in every market. For example, in the U.S. market delivery will be conducted and staffed by only U.S. citizens.

Would this work? This FierceWireless editorial seems to think it might (http://www.fiercewireless.com/story/will-huaweis-new-security-plan-calm-u-s-carriers-concerns/2010-09-16?).

2010 Smartphone Sale Stats From Gartner

Global Smartphone Sales
Company	2010 second quarter	2009 second quarter	Growth rate
Symbian (Nokia)	25.4m (41%)	20.9m (51%)	22%
Research in Motion (Blackberry)	11.2m (18%)	7.8m (19%)	44%
Android (Google)	10.6m (17%)	0.8m (2%)	1300%
iOS (Apple)	8.7m (14%)	5.3m (13%)	64%
Microsoft	3.1m (5%)	3.8m (9%)	-19%
Linux	1.5m (2%)	1.9m (5%)	-21%
Other	1.1m (2%)	0.5m (1%)	118%
Total market	61.6m (100%)	41.0m (100%)	50%

LTE Operator Commitments as of 2010

The following is a data of current operator commitments in LTE, across all regions. The chart is presented from fiercebroadbandwireless. Do read the corresponding article in ( http://www.fiercebroadbandwireless.com/special-reports/mapping-it-out-operator-commitments-lte-2010?utm_medium=nl&utm_source=internal#ixzz0vkOv2AHV)

	Primary vendors
North America
AT&T	Alcatel-Lucent, Ericsson	Deployment scheduled for 2011
LightSquared	Nokia Siemens Networks	Deployment scheduled for second half 2011
MetroPCS	Ericsson	Major metro markets planned for year-end 2010
Shaw Communications	Nokia Siemens Networks	Deployment scheduled for late 2011 in Canada
Verizon Wireless	Alcatel-Lucent, Ericsson	25-30 markets commercially launched by year-end 2010
Europe	-	-
Cosmote (Greece)	N/A	Pilot network launched this year
Net4Mobility	Huawei	100 cities in Sweden by year-end 2011
TDC (Denmark)	N/A	Commercial plans for 2010
Telekom Austria	Huawei	Running LTE pilot network
Telenor Denmark	Nokia Siemens Networks	N/A
TeliaSonera	Ericsson, Nokia Siemens Networks, Huawei	Offering commercial services in Oslo, Norway; Stockholm, Sweden. Expanding coverage to 29 markets in Norway and Sweden
VivaCell-MTS	N/A	Commercial service planned in Armenia in 2010
Vodafone Germany	Ericsson, Huawei	Deployments targeted at rural areas by 2011
Wind (Italy)	Huawei	N/A
Euroasia	-	-
MegaFon (Russia)	N/A	LTE tests beginning this year
Rostelecom (Russia)	N/A	Commercial availability in existing licenses by mid-2011
Yota (Russia)	N/A	Five networks going live by year-end 2010
Asia	-	-
China Mobile	N/A	Completed testing of TD-LTE with plans for trials networks in three cities
Chunghwa Telecom	Ericsson	Completed Taiwan's first field trials
CSL Hong Kong	ZTE	N/A
KDDI	Motorola, NEC	Commercial network in 2012
NTT DoCoMo	Nokia Siemens Networks, Fujitsu, Panasonic	Commercial launch scheduled for year-end 2010
SingTel	NEC	Trials slated for Indonesia, Australia and the Philippines
SK Telecom	N/A	Commercial deployment in Seoul by 2011
Telstra	Huawei	Conducting live trials in Australia
Middle East	-	-
Etisalat	Huawei	Completed field and lab testing
Omantel	N/A	Contract for TD-LTE
Zain Bahrain	Nokia Siemens Networks	N/A
Zain Saudi Arabia	Motorola	N/A
Africa	-	-
Vodacom	N/A	Africa's first live LTE trial
Latin America	-	-
Entel PCS	N/A	Engaged in trials with Rubberduck Media Lab in Chile for high speed mobile TV over LTE tests.
Vivo (Brazil)	N/A	Pilot test planned for 2010

Link to A Thought-Provoking Article On India's Welfare Schemes

Till now I have restricted to writing only on telecom topics. But I think I should make an exception and point to an article that raises some interesting observations on India's landmark social welfare schemes. I may not fully subscribe to its views; but it is very important to hear pro and counter views and increase awareness. The following is a link to the article by Niranjan Rajadhyaksha of Mint (http://www.livemint.com/2010/06/15214825/Of-wine-and-women.html).

The India BWA Auction: the LTE vs WiMAX game and some observations

The BWA auctions in India have ended and have netted the government another 38500 crores.

The aim of this post is primarily twofold:

1. form a picture on how the BWA spectrum allocation affects the LTE vs WiMAX business.

2. observe some peculiar features among the winners of the BWA auction and use this to postulate on their business plans/strategy.

As we know, 2 blocks of BWA spectrum of 20Mhz each were available across all the 22 telecom service areas. In addition BSNL+MTNL had another block of 20Mhz. The following table lists the winners and the breakdown of bids over all the telecom circles. There are only 2 operators here, Bharti and Aircel, who also won spectrum in the 3G auction. For them, both 3G and BWA (4G) spectrum allocations are specified. There is also an operator, Augere, that won spectrum only in Madhya-Pradesh. I have left it out of the table for sake of compactness.

	Infotel	Qual comm	Bharti		Tikona	Aircel
			4G	3G		4G	3G
Delhi	2241	2241	N	3317			N
Mumbai	2292	2292	N	3247			N
Maharashtra	915		915	N			N
Gujarat	613		N	N	613		N
Andhra Pradesh	1059		N	1373		1059	1373
Karnataka	1543		1543	1580			1580
Tamil Nadu	2069		N	1465		2069	1465
Kolkata	523		523	N			545
Kerala	258	258	N	N			312
Punjab	332		332	N			322
Haryana	119	119		N			N
Uttar Pradesh (E)	142			N	142		365
Uttar Pradesh (W)	183			514	183		N
Rajasthan	97			321	97		N
Madhya Pradesh	124						N
West Bengal	70			124		70	124
Himachal Pradesh	20			37	20		N
Bihar	99			203		99	203
Orissa	63			N		63	97
Assam	33			41		33	41
North East	21			42		21	42
Jammu & Kashmir	21			30		21	30
Rs Crore	12847	4912	3314	12300	1058	3438	6499
US Dollar	2.74bn	1.05bn	706mn	2.62bn	225mn	732mn	1.39bn

Observations:

1. Infotel/RIL has obtained a pan-India spectrum.

2. Qualcomm has obtained the other slot of spectrum for the top circles of Delhi & Mumbai.

What does this mean for the choice of BWA technology?

**RIL has already indicated a preference for LTE in its press statement “A single 20 MHz TDD spectrum when used with LTE has the potential of providing greater capacity when compared to existing communication infrastructure in the country.”

**Qualcomm had entered the auctions solely to use the winning slots for LTE.

3. If RIL selects LTE, then given the fact that most other BWA operators (that only have scattered spectrum) may need roaming agreements with RIL, this sort of forces LTE on the other operators too. There is a possible tenuous workaround to this roaming strategy, which I will come to later.

4. RIL+Qualcomm blocking both the spectrum slots for Delhi & Mumbai for LTE removes the scope for WiMAX in the two lucrative circles.

5. Qualcomm emerged as a very strategic player by winning the spectrum in Delhi & Mumbai. It blocked access to WiMAX for these important circles.

**Strategically, it selected regions where the 3G spectrum is expected to hit capacity constraints the earliest and would have the earliest business need to move mobile data users to 4G.

6. One can argue that BSNL+MTNL also have a pan-India spectrum and have shown preference for WiMAX. These operators selecting WiMAX can be the best case scenario for the technology. However BSNL+MTNL do not seem to have the money or the inclination to roll-out BWA in a hurry. Given that they are losing money in their existing businesses and their 3G spectrum is significantly underutilized. They are already making noises that they were forced to buy pan-India 3G+BWA spectrum that they did not need in all circles and want back their share of the auction money.

In conclusion, the India BWA spectrum, which until a few months back, seemed to have the potential to become the poster boy for WiMAX deployments, looks to have gone the TD-LTE way too. Personally I feel it is better to have competing technologies, so that vendors and operators have the advantage of making an informed choice based on their preferences...as in 2G (GSM or CDMA). However 4G seems to be fast becoming a 1 horse race. In this context, I encourage interested readers to go through a nice article by Dr. Shiv Bakshi (http://www.rcrwireless.com/ARTICLE/20100505/SPECTRUM_AUCTION/100509967/analyst-angle-bwa-in-india-wimax-td-lte-and-things-in-the-rearview).

Let us now look at a discerning pattern in how Bharti and Aircel have won their BWA spectrum. These are the only operators to have also won 3G spectrum.

1. If one observes the spectrum allocation table given above, Bharti has won BWA spectrum in 4 circles. It has not won the corresponding 3G spectrum in 3 out of these 4 circles: Maharashtra, West Bengal and Punjab. It is only in Karnataka, where Bharti has got both the BWA and 3G spectrum. Given that

a) Bharti could not win pan-India spectrum in either 3G or 4G

b) Future mobile devices would support both 3G and 4G (BWA)

**the bid pattern shows a defensive effort by Bharti to plug the "holes" in its 3G spectrum with 4G and stitch together a high-data-rate mobile coverage area comprising both 3G & 4G. Its plan would be even more productive if the government allows the operators to use 3G & 4G in the same manner with the same set of services. For example, if regulations permit, voice based services can be used over both technologies, via VoIP.

2. On the contrary, Aircel's bid pattern is driven less by pan-India ambitions and more by a consolidation strategy. It has won 4G spectrum only in circles where it also has 3G spectrum. It has concentrated and consolidated resources on circles where it is or aspires to be a market leader. For example it has won both 3G and 4G bids for Tamil Nadu at a total cost of Rs 3500 crores. It has also won 3G and 4G in Andhra Pradesh for Rs 2500 crores.

3. Given that the cost of 3G and 4G spectrum was so steep that getting pan-India slots was unaffordable, both Bharti and Aircel have been able to party secure their respective business strategies: one as a pan-India operator (Bharti) and one to consolidate its hold on its biggest and best circles (Aircel). Their part success contrasts to the forced withdrawal of the other major 3G players: Reliance, Vodafone, Idea and Tata.

4. Let us look at another interesting point regarding the "high cost" circles of Tamil Nadu, Karnataka, Kolkata and Andhra Pradesh.

**The cost of 4G spectrum in Tamil Nadu (2069 crores) exceeds the cost of 3G spectrum (1465 crores).

**For Karnataka, the cost of 4G spectrum (1543 crores) is almost the same as the cost of 3G spectrum (1580 crores). Same is the case for Kolkata, 4G: 523 crores, 3G: 545 crores.

**For Andhra Pradesh (4G: 1059 crores, 3G: 1373 crores) the 4G and 3G costs are in the same ballpark.

For other "high cost" circles, in general the 4G cost was significantly lower than 3G. So what happened for these 4 circles? An interesting observation is that in all of these 4 circles, both Bharti and Aircel won either the 3G or 4G spectrum. But neither could win both 3G and 4G in all 4 circles. Looking at this I can only speculate that Bharti and Aircel bid each other fiercely in all these 4 circles. While Bharti won the 4G in Karnataka and Kolkata, it lost out Tamil Nadu and Andhra to Aircel. The bid must have been especially challenging in Tamil Nadu, were both Bharti and Aircel have the 3G spectrum and where the 4G spectrum ultimately sold 40% higher than 3G. This is a telling example of what can happen when the government creates artificial scarcity by providing only 2 slots for auction among 11 bidders. If we further consider that one of the bidders (RIL) that has other major businesses and has a rich cash flow, was fully committed to winning a pan-India slot no matter what the cost, this really leaves out only 1 slot open among 10 bidders. Such demand-supply gap is not healthy for any industry.

I would end this post with another observation. The spectrum cost for the entire North-East (including Assam) came to about 50 crores. This is about 1/40 of the spectrum cost of Tamil-Nadu (which has about twice the population of North-East and the highest bid among states). It is also about 1/12 the cost in Gujarat which has a lower population. North-East, Tamil-Nadu and Gujarat have comparable land area. Similarly telecom service areas that have much larger population and area such as Bihar, Madhya-Pradesh (includes Chattisgarh) and West Bengal were sold at a fraction of the cost of Delhi, Mumbai, Tamil-Nadu, Karnataka, Maharashtra and Gujarat. The huge difference in spectrum costs is an evaluation by private industry on how it views business opportunities in these regions. It is also a stark reminder of the failure to ensure regional balances in India's economic growth. Had there been more granularity in the telecom service areas, we would have seen significant regional differences in the spectrum costs of even the most lucrative regions. Many of the separatist and militant movements that scar India today justify their stance in the denial of opportunities to the local populace and the imbalances in economic growth. The hands down to the North-East/East/Central-India in the BWA auction indicates/reinforces the notion of this failure.

So much for the business and governance issues in the BWA and 3G auctions in India. In the next article, I would detail the technical aspects of these technologies. What are the minimum/average/maximum performance benchmarks for 3G and 4G (for example in terms of data-rate and number of subscribers)? How are they distinguished from each other and from the presently available wireless technologies (2G/2.5G)? These are topics that I am more comfortable with and are my bread and butter. I also do not find these discussed widely, in either print or digital media. So I hope to cover this soon.