MWC 2009: HSPA Rules for Ericsson

There's a lot of talk about the introduction of LTE at Mobile World Congress, but Ericsson's CEO is banking on years of HSPA growth

February 16, 2009

4 Min Read
MWC 2009: HSPA Rules for Ericsson

BARCELONA -- GSMA Mobile World Congress -- LTE may be the hottest network technology here in Barcelona, but even one of its most ardent supporters is predicting a limited impact on the mobile broadband market in five years time.

Speaking at an early press and analyst conference here Monday morning, Ericsson AB (Nasdaq: ERIC) CEO Carl-Henric Svanberg noted that, while his company is determined to push itself as a leader in LTE (Long Term Evolution), the so-called 4G technology that is set to dominate the next generation of mobile networks, the bulk of mobile broadband deployments in the coming five years will be based on HSPA (High-Speed Packet Access), the technology that is being deployed globally right now. (See Ericsson Earmarks $25B for R&D and Ericsson Launches LTE Core.)

He presented a forecast of the broadband world in 2014 that showed 3.5 billion high-speed access lines globally, about 80 percent of which would be via wireless, rather than fixed, connections.

Of those 3 billion projected mobile broadband lines, about 70 percent will be HSPA, forecasts Ericsson, which, of course, hopes to be able to reap the rewards of its HSPA investments for many years to come.

LTE, which, while having a theoretical peak downlink data speed of 173 Mbit/s, is set to deliver real-world, average downlink data rates of 34 Mbit/s and uplinks of about 7.3 Mbit/s, will account for less than 10 percent, even though shipments and deployment are expected to kick in next year. (See TeliaSonera: We'll Do 4G in 2010, Verizon to Name LTE Vendors at MWC, and AT&T & Verizon to Use 700 MHz for 4G .)

That's because LTE deployments will begin at different times for different types of carriers, said Svanberg, in response to questions from Light Reading. He noted that many of the early LTE adopters are likely to be those operators that are currently using a 2G or 3G network technology, such as CDMA, that doesn't provide a migration to LTE via HSPA, and operators that have deployed 3G networks using platforms that are not easy to migrate to LTE and true 4G technologies.

Alongside those operators, many carriers that are deploying HSPA now will be able to deploy a number of evolutions of the technology, which will, in theory, ultimately deliver downlink speeds of up to 100 Mbit/s.

The Ericsson CEO, who stated last month that the global economic downturn had yet to curtail Ericsson's business, noted that, although GSM was introduced in the early 1990s, his company reported its record year of GSM shipments in 2008, "so maybe we will have our record year of HSPA shipments in 2020. LTE and HSPA will coexist," he stated -- and he's not alone in that view. (See Ericsson Soars on Strong Q4, Outlook and 3G vs LTE: No Contest.)

And the Swedish giant is showing off its latest HSPA developments here in Barcelona, with a demonstration of the 21 Mbit/s downlink version that has already been deployed by Telstra Corp. Ltd. (ASX: TLS; NZK: TLS) in Australia; the 28 Mbit/s HSPA solution that uses MIMO; and even a 42 Mbit/s version, though commercial availability timetables for the latter two speeds haven't yet been made available. (See Ericsson Pumps Up HSPA and Telstra Pushes HSPA Limits.)

But questions remain about how easy, and economical, it will be for carriers to migrate to LTE. Although it is widely accepted that the shift from 3G to LTE won't be as painful as the move from 2G to 3G, Ericsson won't say when it believes LTE will be a stable technology with plenty of device choice and wide availability: One of the major holdups for 3G was a lack of devices for customers to use.

Ericsson's head of networks, Johan Wibergh, did tell Light Reading, though, that the introduction of LTE is set to be much quicker and easier than with 3G, as network migration will mainly involve upgrades to existing deployed chassis, and LTE services will likely begin mostly with dongles and integrated units on laptops rather than on brand new, yet-to-be-developed handset terminals.

Quicker, then, means anything less than about eight years.

Paolo Pescatore, director of operator strategy at consultancy CCS Insight , believes there are a number of variables that will affect the speed of carrier uptake and rollout of LTE. He says there are very few LTE orders yet, and that he doesn't expect to see many until operators have upgraded from 14 Mbit/s HSPA to the 28 Mbit/s version. While Pescatore agrees with Wibergh that dongles and integrated modules will be the initial devices for LTE, and that their introduction will be easier than with 3G phones, he notes that it's hard to tell whether the current exponential growth in data service usage that's set to drive the requirement for LTE rollouts will be maintained during a period of economic uncertainty, and that there's still a great deal of uncertainty about the availability of the spectrum required for LTE.

In addition, the so-called Digital Dividend spectrum that many operators are hoping will be made available to them for future mobile data services could be put to other uses, notes the CCS Insight man.

— Ray Le Maistre, International News Editor, Light Reading

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