February 12, 2008
BARCELONA -- Mobile World Congress -- Today's Vodafone Group plc (NYSE: VOD) announcement of an evolved high-speed packet access (HSPA) trial and future upgrades shows that there's life in the ol' UMTS 3G network yet, even while the operator also looks toward long-term evolution (LTE) as a 4G option.
Vodafone will work with Ericsson AB (Nasdaq: ERIC), Huawei Technologies Co. Ltd. , and Qualcomm Inc. (Nasdaq: QCOM) to test the performance of 3rd Generation Partnership Project (3GPP) Release 7 HSPA+ (also referred to as evolved HSPA or HSPA evolution). (See Vodafone Trials HSPA+.)
The operator wants to determine whether HSPA+ can indeed do what it says on the box, which is deliver downlink speeds up to 28.8 Mbit/s, or twice as much bandwidth as today's HSPA.
HSPA+ gets the capacity boost through the use of multiple-input/multiple-output (MIMO) antenna systems at the base station and in the handsets, as well as a modulation technique called 64-QAM HSDPA.
But Vodafone's HSPA+ trial is not necessarily an indication of commitment to the technology. The operator also has its eye on the next generation of the LTE mobile broadband standard. (See Vodafone Plans LTE Powwow, LTE Hits 300 Mbit/s, Verizon, Vodafone Head for LTE, and 3G LTE: How Far? How Fast?.)
“These trials will help us to ascertain whether HSPA+ voice and data capacity enhancements will be able to leverage existing UMTS assets, including radio spectrum, to prolong the lifespan of current UMTS networks still further,” said Steve Pusey, Vodafone's Global CTO, in a statement. “It will complement the exploratory work we are carrying out into more long-term next generation wireless technologies such as LTE.”
HSPA+ is expected to be commercially available sometime in 2009. That means WCDMA operators will face an important choice: Do they boost their 3G network capacity through continued software upgrades, or do they start to invest in 4G technology, like LTE?
"The issue for operators in this timeframe will be whether to continue investing in HSPA-evolved, representing a continuation of the WCDMA standard, or else prepare to deploy the newer, more efficient, OFDMA-based mobile broadband technologies like LTE," says Heavy Reading senior analyst Patrick Donegan.
Vodafone, for one, has not indicated that it will deploy HSPA+, but its trial will help it to make a decision.
Financial analysts certainly like the sound of increased data capacity for relatively little capex spend.
Dresdner Kleinwort analyst Robert Grindle said in a research note today about Vodafone's HSPA upgrade plans and trial: "These represent the latest steps in the upgrade of 3G which both increases capacity and improves user speeds for limited additional cost. This allows stronger top line growth from mobile data whilst simultaneously seeing capex remain low and cashflows high."
Vodafone has already upgraded some of its UMTS networks to HSPA with peak downlink rates of up to 7.2 Mbit/s in some key markets. The operator says it plans to do a software upgrade "from the end of this year" to deliver up to 14.4 Mbit/s in some of those markets "subject to device availability." (See Vodafone Soups Up HSDPA, Vodafone Launches HSUPA, and V'fone Adds HSPA Handsets.)
The "device availability" disclaimer is an important phrase, because while the networks are capable of being upgraded to 14.4 Mbit/s, no HSPA devices support such speeds.
"14.4 Mbit/s [devices] any time soon? I think probably not," said Nigel Wright, vice president, product marketing at Spirent Communications plc , speaking in an HSPA panel here today.
That could be an issue for some operators wanting to get the most out of their installed UMTS networks. But not all operators are bothered by the shortcoming.
"14.4 Mbit/s is not an issue in the near term. What we have currently seems to be good enough," said fellow panelist Dave Williams, CTO of Telefónica Europe plc (O2) .
— Michelle Donegan, European Editor, Unstrung
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