Moto Gives NSN a WiMax Option in India
That's because Moto's WiMax assets, combined with the Long Term Evolution (LTE) assets of both vendors and NSN's professional services, could help the giant European vendor land some critical network rollout deals in the wake of India's recent BWA (broadband wireless access) spectrum auction. (See NSN Back in Love With WiMax and India's BWA Auction Ends in $8.2B Drama.)
While a number of India's BWA spectrum owners are looking at TD-LTE as their network technology of choice in the medium and long term, most (if not all) of the BWA players are likely to launch their initial services using WiMax, and some could stick with that technology as it evolves to WiMax 2.0 instead of moving to TD-LTE. (See India's Still Hot for WiMax, Says Forum .)
Any roadmap involving WiMax is currently tough to support for NSN, which relies on a partnership with Alvarion Technologies Ltd. (Nasdaq: ALVR) to support its customers' WiMax demands. (See NSN: Alvarion's New WiMax Buddy.)
"NSN has been concentrating on LTE technology… The recent auction of broadband spectrum in India could pose some tricky questions for NSN if the operators choose cost-effective WiMax over LTE," says Sai Chandra Kanala, senior analyst for telecom and technology at Datamonitor India.
But bringing mature and trusted WiMax assets on board as part of the Motorola deal will likely make NSN a more appealing vendor partner for the BWA players and give it a shot at helping to build India's wireless broadband infrastructure. Closing the deal would "insulate NSN from an eventuality wherein some of the broadband players may choose to go with WiMax," Kanala tells Light Reading Asia, as NSN would be able to pitch for business using Motorola's WiMax portfolio, including a range of low-cost customer premises devices currently being developed in anticipation of increasing demand. (See Moto Preps Low-Cost WiMax Devices for India.)
The acquisition will also add further depth to NSN's existing mobile infrastructure business in India, where the vendor counts Aircel Ltd. , Bharti Airtel Ltd. (Mumbai: BHARTIARTL), Bharat Sanchar Nigam Ltd. (BSNL) , Idea Cellular Ltd. , Tata Teleservices Ltd. , Uninor , and Vodafone India among its 2G customers. (See Tata Backhauls With NSN, IDEA Cellular Uses NSN, NSN Wins GPRS Deal in India, and NSN Completes V'fone Essar Build.)
Motorola, meanwhile, is a long-standing GSM equipment supplier to both state-owned carriers, BSNL (in the South zone) and Mahanagar Telephone Nigam Ltd. (MTNL) in New Delhi. It is also the 3G/UMTS access supplier to MTNL (which received its 3G spectrum early, along with BSNL) and has been a CDMA equipment provider to Tata Teleservices. (See Moto Wins in India.)
Now all the vendors are gearing up to try and land infrastructure deals from the operators that recently won 3G spectrum in the recent auction. (See India's 3G Players Ready for Swift Launch, WiMax, 3G to Dominate India's Broadband Future, MTNL, BSNL Prep for 3G Battle , and India's 3G Auction Ends, Raises $14.6B.)
And NSN, which was already confident of picking up 3G business, and may feel its chances are even better while its Chinese rivals battle with equipment import restrictions, believes the addition of Motorola's mobile business will increase its chances. (See Huawei Confident of Indian Import Resolution.)
"The integration with Motorola is likely to be completed by the end this year. A lot of 3G decisions in India are likely to happen by then," notes NSN spokesperson Kanika Atri. "We believe, with this acquisition, we are well positioned to grab a significant share of this market."
In addition, Datamonitor's Kanala believes the deal might help stabilize what is currently a turbulent equipment market in India: "This space has witnessed severe competition, and some of the equipment vendors have reduced prices to absurd levels. With this acquisition, some of the pricing pressure will ease for the companies."
— Gagandeep Kaur, India Editor, Light Reading