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Nokia Promises EDGEy 2003

Nokia Corp. (NYSE: NOK) claims it will deliver EDGE-capable mobile devices to European GSM operators in the second half of 2003.

Rene Svendsen-Tune (no, he didn't sing us a song!), senior VP for marketing and sales at Nokia's IP Mobility Networks division, told Unstrung at Nokia's Mobile Internet Conference in Munich that "EDGE terminals for European frequencies [900 MHz and 1,800 MHz] will be available in the second half of 2003," though he would not elaborate on volumes.

He also declined to name any of the operators that have allegedly taken delivery of EDGE (enhanced data for GSM evolution) equipment, but noted that operators that do not have a UMTS license are likely to be a key target market.

"EDGE is an obvious next step for those operators that do not have a 3G license. We are convinced that those GSM operators that do not have 3G spectrum will go down that route. We also believe that most GSM operators will leverage their [2G] spectrum to deploy EDGE at some stage, but there is not a strong momentum in Europe just now."

EDGE is an enhancement to the GSM and TDMA wireless communications systems that increases data throughput up to 384 kbit/s. EDGE uses the same basic network structure as existing 2G technologies. Nokia has already made some loose announcements about its EDGE position and plans (see Nokia Gets EDGEy). For those operators without a 3G license, EDGE would at least offer an opportunity for higher data rates than will be possible with GPRS, while, in many cases, not having to replace base stations. Both Nokia and LM Ericsson (Nasdaq: ERICD) have built upgrade opportunities into their GSM network equipment for years, and they market EDGE technology as a simple and cheap upgrade. In addition, as part of the GSM evolution cycle (GSM-GPRS-EDGE-Wideband-CDMA), it would allow these 3G-less carriers: applications continuity; enhancements enabled by increased data rates; and the possibility of device support from existing GSM vendors.

Executives at Ericsson, Nokia's main GSM infrastructure rival, agree that EDGE will be deployed first by the 3G-less operators, and ultimately by most GSM carriers. "Why wouldn't an operator want to triple the IP capacity offered by GPRS?" said Mikael Halén, the Swedish vendor's director of W-CDMA marketing during a recent telephone interview with Unstrung. "GSM operators want to preserve the investment they have already made in their networks."

Which all sounds rather promising for the takeup of EDGE, seeing as how no additional (expensive) licenses or spectrum are required. Nokia's Svendsen-Tune is wise to this and, without prompting, proclaims W-CDMA as the ultimate capability for GSM operators and startup greenfield carriers alike. Wideband-CDMA increases data rates in GSM systems by using the CDMA air interface instead of TDMA; it is part of the universal mobile telecommunications specification (UMTS).

"W-CDMA still allows the most cost-effective solution and the best use of available capacity," he proclaims, knowing of course that the 3G license conditions require network infrastructure above and beyond the capabilities of EDGE. Knowing that they need to pump their cash and effort into UMTS/W-CDMA to meet their regulatory requirements, European operators with 3G licenses have no plans at present to deploy EDGE, according to IDC senior research analyst Paolo Pescatore.

While Europe looks at present to be less of an opportunity, the market is already developing in North America, while Asia is showing signs of interest, says Svendsen-Tune. "There is clear progression in the U.S. where WCDMA frequencies [2.5 GHz] are not available yet. AT&T Wireless Services Inc. [NYSE: AWE], Cingular Wireless, and T-Mobile USA have all announced plans and begun work on their networks. EDGE terminals for North America's GSM frequencies [850 MHz and 1,900 MHz] will be available in the first half of 2003," he says, which indicates a slight slip in timescales for handset delivery, as Nokia executives said during the company's recent financial statements that they would be available before the end of 2002.

Asia is less developed, but some operators should deploy EDGE in 2003, says the Nokia man, but that this would be outside the territories already well developed in high-capacity network systems (i.e., Hong Kong, Japan, Korea, and Taiwan).

On more general matters, Svendsen-Tune says Nokia is delivering WLAN equipment and systems to mobile operators for WLAN/WAN integration on all continents -- though you can count the number of customers at present on the fingers of "several hands" -- and that this is its own manufactured equipment based on the Institute of Electrical and Electronics Engineers Inc. (IEEE)'s 802.11 standards. Its channel via systems partner IBM Corp. (NYSE: IBM) is very important here, he says.

In the W-CDMA network equipment market, "Nokia has said we will take 35 percent of the market, and we are already very close to that." How close? "More than 30 percent, measured in actual sales booked."

He also claims that Nokia has a "very strong market position in GSM networks in China," but declines to say what that equates to in market share, simply stating that Nokia has a global share of the GSM equipment market "in the high 20s percent."

— Ray Le Maistre, European Editor, Unstrung
www.unstrung.com
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christer44 12/4/2012 | 9:24:43 PM
re: Nokia Promises EDGEy 2003 Dan wrote:
>"EDGE terminals for European frequencies [800 >MHz and 1,900 MHz] will be available in the >second half of 2003," though he would not >elaborate on volumes.

Last time I checked Europe used 1800 MHz and not 1900 for GSM...

You don't really expect to get away with such obvious typos without nit-pickers calling attention to it, do you? :-)

spc_rayella 12/4/2012 | 9:24:35 PM
re: Nokia Promises EDGEy 2003 Thanks for that. It was not Dan who quoted the wrong frequency but me. Now corrected.

memo to self - take more time over the figures...

Unstrung Ray
incards 12/4/2012 | 9:24:15 PM
re: Nokia Promises EDGEy 2003 Unstrung Ray: Nice job at the Sonera event. I am hopeful that you are attending the 2002 EDGE Update at NMIC and will give us a piece on the demo's and the roadmap of EDGE terminals. - IC -
spc_rayella 12/4/2012 | 9:24:07 PM
re: Nokia Promises EDGEy 2003 I did ask Nokia if I could attend, but the EDGE update and all the sessions on the Tuesday and Wednesday of this week in Munich were for customers and partners only, about 1,000 of them. No prying press allowed :-)

So we had our presentation on Monday, the outcome of which you can see on the sie here. EDGE was not included in the main presentation, which focused on the new terminals and some new services for carriers. EDGE is something that I tried to tackle in a one-to-one discussion with a Nokia executive.

EDGE is, I think, an interesting development, but I do wonder whether it will offer the vendors affordable economy of scale in their production plans, especially in terminals. The out-of-factory and unsubsidized prices for EDGE handsets could be quite steep, I would guess. We'll see.

Unstrung Ray
incards 12/4/2012 | 9:24:04 PM
re: Nokia Promises EDGEy 2003 Unstrung Ray:My previous post said 2003 (Nokia EDGE terminal shipping) and should have said 2002. Make that an EDGE 850/1900 MHz terminal. - IC -
incards 12/4/2012 | 9:24:04 PM
re: Nokia Promises EDGEy 2003 Unstrung Ray: I appreciate the update on EDGE and am sorry to here the press wasn't in on the EDGE Update 2002 event. Nokia's Q3 CC slides suggested that they would ship an EDGE terminal in 2003 and if they do I suspect it will be for IOT and conformance testing. Nokia is hosting an analysts breakfast in Vegas on the 17th in conjunction with Fall COMDEX 2002 and I am wondering if they plan to do a product launch there or at their Dallas Strategy Update in Dallas on December 3, or wait for CeBIT and CTIA. - IC -
futureisbright 12/4/2012 | 9:24:02 PM
re: Nokia Promises EDGEy 2003 when will the EDGE 800/1900 terminals become available?
spc_rayella 12/4/2012 | 9:24:01 PM
re: Nokia Promises EDGEy 2003 "EDGE terminals for North America's GSM frequencies [850 MHz and 1,900 MHz] will be available in the first half of 2003," he says, which indicates a slight slip in timescales for handset delivery, as Nokia executives said during the company's recent financial statements that they would be available before the end of 2002.

Then, I guess, it's a case of deciding just what availability means, in what numbers etc. The only people that really know are the h'set guys themselves, though I'm sure the U.S. operators will have some dates they're keen on too!

Unstrung Ray
futureisbright 12/4/2012 | 9:23:45 PM
re: Nokia Promises EDGEy 2003 The interesting thing about wireless development is that you don't need terminals until the infra is ready, and you don't need the infra until the terminals are ready. And you don't need either until the operators are ready. Interesting balance to keep with cash flow requirements!

NOK, ERICY, and SI have sweept much of the GSM market in NA based on their promises for EDGE development. What are we looking at now, 1H04 customer deployment?
standardsarefun 12/4/2012 | 9:23:08 PM
re: Nokia Promises EDGEy 2003 Does anyone have ideas about the real bit rates a real users would see in an EDGE powered cell when it (and its neighbours) are carrying real traffic?

The famous 384 kbit/s obviously is not realistic since this means all 8 slots dediciated to one user (how many slots will these Nokia EDGE phones support - my guess it 4 maximum) and you only get the maximum bitrate per slot when:
1) you are in the middle of the cell
2) the rest of the world is asleep (2 AM will be a great time to mobile web surf!) so you don't share the slot
3) nobody is in the middle of a neighbouring cell surfing and the interference is zero

Given all of that what do you think the real average increase will be? I guess is about +50% over classic GPRS.

P.S. Remember you need to consider layers 1, 2 and 3 plus the traffic and cell engineering or else you need about 15 real EDGE cells and about 1000 phones before you get a good estimate
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