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Offering 3G services

in the 900 MHz Band


Neo Phukubje
Business Advisor, Nokia Siemens Networks
ITU-D Lusaka, Zambia

1 © Nokia Siemens Networks Nokia World 2008


Making Lives Better

The reasoning behind


US President Obama‘s US$6 billion support
for broadband rollout in underserved areas:

"For every dollar invested in broadband,


the economy sees a ten-fold return on
that investment."

- American Recovery and


Reinvestment Bill, 2009

Source: wi-fiplanet.com, January 2009


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ARPU increasingly generated with data
services
40

35

30
fic
EUR per month

af
25 Tr
20 A R PU
15
Cost per b
10 it
5

2010
2005

2006

2007

2008

2009

2011

2012
2004
2001

2002

2003

Voice ARPU Data ARPU


Source: Joint Nokia Siemens Business Intelligence Team Status: 03 / 2007

Key Success Factors:


• Attractive new data services to generate additional revenues
• Improve Cost Position for early ROI

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Data traffic and revenue keep growing
Comparison of HSDPA throughput July 07 – July 08

Operator in Europe:
7000 GB / day
Data Revenue +10%

Operator in APAC:
Data Revenue +16%
4000 GB / day
Operator in APAC:
Data Revenue +24%

Operator in APAC:
2000 GB / day
Data Revenue +10%

Operator in Europe:
Data Revenue +10%

Source: NSN analysis Source: Merril Lynch, Global Wireless Matrix


Mar07-Mar08, local currencies

“3G drives data use, not the other way around”


-- Ovum, 2008

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Satisfying the market’s largest unmet need
Differentiation
Internet penetration 2007 (% of households)

Pressure Index

Taiwan
North America
US Korea
Size of Mobile
Japan
Australia
Finland
Broadband
UK Hong Kong

Germany
Opportunity
Western Europe
France Italy

Hungary Size of Voice


Czech Republic
Mexico
China Opportunity
Saudi Arabia
Asia
Iran Brazil Philippines Urban Africa
Poland
Latin America
Rural Africa
Egypt
Middle East Russia
India Africa Eastern Europe
South Africa
Pakistan Indonesia

Mobile penetration 2007 (subscription density)

Today’s strongest opportunities for growth:


•Voice for rural population
•Mobile broadband for urban dwellers
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Teledensity is still very low in comparison
with South African population: Room to
grow
Total population: 47 Million

Mobile Phone user base: 39.6 Million (85%)

Internet users: 5.1 Million (11%)

Main telephone lines: 4.7 Million (10%)

Mobile 3G user base: 2 Million (4%)

Fixed broadband subs: 0.3 Million (0.6%)

Fixed broadband subscribers only represent 6% of all


internet users in the country

Source: ITU ICT Statistics 2006; NSN Market Compendium 2007; various public sources South Africa

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Addressing challenges with
WCDMA Frequency Refarming
• Operator introduces 3G services into Operators current GSM bandwidth
the frequency band that is already
used for GSM
WCDMA/HSPA
• In order to fit the WCDMA carrier into
same bandwidth, typically spectrum = WCDMA
efficiency needs to be improved = GSM after refarming

Why UMTS 900?


2100/1900 MHz band

900/850 MHz band


WCDMA at 900 MHz frequency 3G
Low
3G
High
– typical deployment scenarios band
cell
band
cell

Sub-urban & Urban 3G Wireless Initial 3G


rural coverage coverage broadband for roll-out
expansion improvement sub-urban & • Currently
• Currently WCDMA • Fill-in and indoor rural WCDMA
services not yet coverage • Currently poor or services not yet
available non-existing fixed available
• In many cases
• Easiest and most GSM traffic broadband • Logical approach
common approach pushed to 1800 • Data optimized to start with
• Easier to release MHz layer 900 MHz layer lower
part of frequencies with I-HSPA frequencies
for WCDMA

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Sandwich-type frequency allocation
recommended for efficient refarming
Closest frequencies at both sides of the WCDMA carrier can be optimally
utilized for GSM frequencies
• Guard bands can be minimized with Flexi BTS 4.2 MHz filter and
coordinated network deployment
4.2 MHz

Other operator’s WCDMA/HSPA


Other operator’s
band band

2.2 MHz

2.4 MHz

2.6 MHz

= WCDMA/HSPA
= Non-BCCH GSM, coordinated deployment
= BCCH GSM, coordinated deployment
= GSM, uncoordinated deployment
Unique 4.2 MHz carrier bandwidth feature to
ensure GSM capacity in WCDMA Refarming
3GPP specification Nokia Siemens
Enable 1 additional TRX Networks solution
in GSM layer 2.8 MHz 2.2 MHz

• Enabled by advanced design of


Flexi filter
• Supported with standard UEs
• Ensures high performance WCDMA/ GSM/
HSPA EDGE
• WCDMA network capacity
same as with 5 MHz
• GSM and WCDMA network Example
Nokia Siemens Standard
qualities remain high Network solution solution
• Tested in several field trials WCDMA 1+1+1 1+1+1
GSM 2+2+2 1+1+1
AMR 4+4+4 3+3+3
AMR + DFCA 6+6+6 n/a
Minimize Needed Hardware and Sites with
Spectral Efficiency Features
Erl/MHz/cell Spectral Efficiency
Spectral efficiency features 36

enable considerable 34
32
reduction in 30
28
• number of sites 26
24

• amount of site hardware 22


20

• site visits 18
16
14
12
10
SAIC/STIRC 8
SAIC = Single Antenna Interference Cancellation DFCA 6
STIRC = Space Time Interference Rejection Combining AMR 4
DFCA =Dynamic Frequency Channel Allocation Basic GSM 2
AMR = Adaptive Multi Rate codecs 0

DFCA and STIRC are unique features for


Nokia Siemens Networks
Reduced number of sites with WCDMA
900MHz Solution
Lower radio network CAPEX/OPEX and fast network deployment
• 65% less sites needed with WCDMA850 or 900 compared to WCDMA2100
In building 3G services without dedicated indoor systems
• 100% improvement with WCDMA and HSPA indoor data rates

WCDMA900

WCDMA850 & 900


WCDMA2100
gives 2.8 x larger cell
coverage area than
WCDMA2100

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Value of WCDMA Refarming
with Nokia Siemens Networks
Cost of rural coverage HSPA data rates
k€ kbps
45,000 6000
HSPA900
OPEX
40,000 HSPA2100
CAPEX 5000
35,000
30,000 4000
-60% +60%
25,000
3000
20,000
15,000 2000
10,000 +130%
1000
5,000

0
WCDMA2100 WCDMA900/850 Outdoor Indoor, -10dB Indoor, -20dB
penetration loss penetration loss

WCDMA900/850 triples the HSPA900/850 boosts indoor


cell area in rural areas data rates above 1 Mbps

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Terminals
WCDMA terminal selling prices
Price Shipments
(USD) (Millions)
$ 280 700
$ 260

$ 240 600
$ 220

$ 200 Low tier 500


$ 180 80 USD
$ 160
by end of 400

$ 140
2009 300
$ 120
CDMA2000 Global
$ 100
Handset Shipments
$ 80 200
WCDMA Global
$ 60 Handset Shipments
100 WCDMA
$ 40
Low-Tier Average
$ 20
0
$ 0
2004 2005 2006 2007 2008 2009e 2010e

Sources: ABI, IDC, Strategy Analytics and Yankee Group handset shipment forecasts

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Terminals
Nokia’s target consumers are mobile subscribers in low-tier urban and rural
areas Population spread
Suburban /
Urban low tier cities Rural
Fixed line Mobile penetration No Internet
High internet access
Population by income class

set
nd
G ha
t 3
e sers
r g
Mid Ta u

Low

Source: EMS R&D material 16-May-2008


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Mobile broadband growth driven by
explosion of laptops with dongles

5.6x increase in 7
months

With HSDPA, operators


can market
“mobile broadband”
instead of “3G”

Dongle subscribers will


usually have a mobile
Unlike fixed broadband, phone as well – this is
mobile broadband’s market is almost entirely additional
revenue
individual consumers,
Source: Ovum, 2008 not households
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The case for 3G in developed markets
Telstra Australia: 3G effect on ARPU
Telstra postpaid ARPU at end
2007
$80 46% higher
$70
$60
$50 3G subscribers are:
$40
•35% of Telstra’s total subscriber base
•60% of Telstra’s postpaid base
$30
$20 Not just early adopters any more!
$10
$0
2G
2G ARPU
ARPU 3G3GARPU
ARPU

Source: Ovum, 2008

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The Question:
Can this success be replicated
in emerging markets?

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Broadband for development
250

200

150

100
Rural
50 Population
Urban
0 Population

Indonesia
Colombia
Georgia

Bolivia

Philippines
Senegal

Turkey
Algeria
Finland

Iran
Vietnam
Malaysia
Kenya

South

Pakistan
Egypt

Finland’s entire population of 5 million is exceeded by the


urban population alone of most emerging nations – given the
right approach, the potential market for 3G is there

Source: World Bank Development Indicators 2006

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Conclusions
WCDMA 900 MHz
user equipments are
Regulators moving arriving to market
towards technology
neutral licenses and Already several
starting to allow operators are
WCDMA in 900 MHz deploying WCDMA
in 900/850 MHz

The challenge is how


Nokia Siemens to successfully
Networks offer a accommodate
complete e-2-e WCDMA into GSM
solution for efficient band
WCDMA Refarming

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Thank you

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