Pyramid: LTE Growth Will Outpace 3G

Pyramid Research is expecting Long Term Evolution (LTE) networks to grow more rapidly than their 3G antecedents, with 100 million subscribers expected on the proto-4G technology in just four years.

In its lastest Global Telecom Insider report, "LTE’s Five-Year Global Forecast: Poised to Grow Faster than 3G," Pyramid highlights the factors set to make LTE a fast-growing mobile broadband technology.

Key among these is the cost of the network. Even though carriers will still spend billions of dollars rolling out LTE, the flat-IP architecture at the heart of the network means fewer components, and this equals less overall cost.

Combine this with widespread vendor and operator support for the technology, and the fact that Chinese carriers could move to LTE as early as 2011, and Pyramid is predicting rapid growth for the technology during the four years from 2010.

"Taken together, these factors will drive LTE to grow more rapidly than preceding mobile standards in terms of subscriptions," writes Pyramid research analyst Dan Locke in the report.

"While it took nearly six years for UMTS/HSPA to reach 100 million subscriptions, we estimate that LTE will take just over four years to reach the same milestone. The number of LTE subscriptions worldwide will grow at a CAGR [Compound Annual Growth Rate] of 404 percent from 2010 to 2014 and reach 136 million by year-end 2014."

Part of this growth is because many carriers are expected to deploy LTE networks in 2010 or 2011. Pyramid expects 12 carriers to start deploying LTE, including Verizon Wireless , MetroPCS Inc. (NYSE: PCS), NTT DoCoMo Inc. (NYSE: DCM), and Rogers Wireless Communications Inc. (NYSE: RCN; Toronto: RCM).

Verizon Wireless executives have stated several times they expect the buildout of the operator's LTE network, which will likely be first in the U.S., to be completed within a few years. This means that the LTE network should be completed in 2014 and be a good barometer to watch to judge how fast LTE network subscribers are being added.

— Dan Jones, Site Editor, Unstrung

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