The complaints are familiar to every iPhone and BlackBerry user: The network is too slow. It’s not living up to expectations. Or, in Tweet-speak: #yournetworksucks. Caught in a hypercompetitive world of accelerating customer churn, carriers are moving to address quality-degrading mobile broadband congestion with extensive plans for additional radio-access buildouts. The solution was supposed to be 4G technology, specifically high-speed LTE networks, but 3G HSPA+ upgrades have resurged — which has the unfortunate side effect of driving a quicker-than-expected crisis in the backhaul portion of the network.
AT&T Inc. for instance just announced that it will bring a full 14.4mbps (peak) to 250 million 3G users via a HSPA+ upgrade, scheduled to be completed by the end of 2010. The carrier is doing this before moving to LTE, and the move will significantly hasten the backhaul shortfall.
Region |
CAPEX cost of LTE |
CAPEX cost of HSPA+ |
CAPEX reduction |
UK |
£518m ($750m) |
£173m ($250m) |
£345m ($500m) |
US |
£1.23bn ($1.78bn) |
£410m ($594m) |
£818m ($1.19bn) |
Gulf territories |
£233m ($337bn) |
£77m ($112m) |
£155m ($225m) |
Asia Pacific |
£160 ($232m) |
£53m ($77m) |
£107m ($155m) |
Source: AIRCOM
Gartner Inc. says that when LTE arrives in force sometime late next year and in 2012, carriers should expect to offer more than 100 Mbps of backhaul capacity per site, via a “graceful” migration from TDM copper links to an all-IP architecture. But upgrades to HSPA+ will double the peak speeds now available and invite more data usage from existing devices, to the point where that backhaul upgrade can’t really wait two years.
T-Mobile USA said recently it will implement a commercialized version of HSPA+ that can provide a top theoretical speed of 21 Mbps, roughly equivalent to LTE. Mobile operators have realized that interim HSPA+ deployments can save two-thirds of the cost of building out LTE. Telecom consultancy Aircom said this week that a $750 million investment in the first 12 months is required to start LTE rollouts, compared to just $250 million for HSPA+. Essentially a software upgrade, HSPA+ is also a much quicker implementation. Meanwhile the cost of LTE gear should fall drastically in the next two years, giving operators an even better reason to delay LTE and do HSPA+ now.
