Key to this outcome is the emergence of modular, standards-based equipment, finds 3G Base Station Design & Wireless Network Economics, a new report from by Unstrung Insider, which examines the market forces shaping the design and implementation of next-generation cellular base stations.
As the highest unit-volume product in the $56 billion mobile infrastructure market, base stations have long been the focus of cost-reduction initiatives. With equipment now counting for less than half the typical cost of a cell site, there is increasing pressure on vendors to deliver product designs that minimize overall site costs.
Initially this means split-architecture products, with distinct RF and server modules connected over fiber optic cable, as opposed to weighty and expensive copper coax. Sometimes called zero-footprint architectures, these products allow the operator to deploy Remote Radio Heads (RRHs) close to the antenna to ensure coverage, with baseband server units housed centrally to provide network capacity.
Multiple vendors, including Alcatel (NYSE: ALA; Paris: CGEP:PA), Ericsson AB (Nasdaq: ERIC), Huawei Technologies Co. Ltd. , Motorola Inc. (NYSE: MOT), Nokia Corp. (NYSE: NOK), Nortel Networks Ltd. , and Siemens AG (NYSE: SI; Frankfurt: SIE)/NEC Corp. (Tokyo: 6701), now offer such split-architecture products, often using interfaces defined by either the (Open Base Station Architecture Initiative (OBSAI) ) or the competing (Common Public Radio Interface (CPRI) ) specifications.
Other benefits of modular designs include the flexibility to evolve subsystems and components at different rates, the ability to take advantage of a competitive supplier base, and the capacity to serve multiple markets off a common platform, all of which have important implications for equipment providers seeking to develop multi-radio product strategies that span multiple types of 3G and WiMax systems.
At the module level, multiple innovations are poised to feed through the base station ecosystem. Here’s a summary:
- RF modules capable of supporting a wide range of frequency bands are emerging, allowing base station manufacturers to rationalize their product inventory. In addition to the major equipment manufacturers, third-party vendors in this segment include Andrew and Powerwave Technologies Inc. (Nasdaq: PWAV).
- Programmable baseband modules are now widely used (in place of Application-Specific Integrated Circuits) and will be critical to meet the increased complexity and performance inherent in next-generation WiMax and 3G Long-Term Evolution products. Vendors here include Altera Corp. (Nasdaq: ALTR), Analog Devices Inc. (NYSE: ADI), and Xilinx Inc. (Nasdaq: XLNX), with Texas Instruments Inc. (NYSE: TXN) and Picochip already pushing muti-core devices.
- Network processors from providers such as Intel Corp. (Nasdaq: INTC), Agere Systems Inc. (NYSE: AGR.A), and Wintegra Inc. , are being positioned for multi-protocol network interface cards, as operator seek more flexible backhaul options, including IP/Ethernet.
— Gabriel Brown, Chief Analyst, Unstrung Insider
The report, 3G Base Station Design & Wireless Network Economics, is available as part of an annual subscription (12 monthly issues) to Unstrung Insider, priced at $1,595. Individual reports are available for $900. To subscribe, please visit: www.unstrung.com/insider.