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June 2010
Al Williams
LTE Portfolio Management Team
Al.Williams@alcatel-lucent.com
Huawei LTE RAN Competitive Analysis
Contents
Date Changes
Oct 13, 2009 Initial Version
June, 2010 Major update: Addition of exec summary, rewrite of market section, updates of product
sections, addition of selling points throughout.
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1
Huawei’s LTE RAN
Executive Summary
Executive Summary
Huawei Intends to Win
Huawei’s goal is to become the #1 LTE vendor in the world.
Is this a reasonable goal? Consider three key points regarding Huawei:
1. Huawei’s wireless growth has been rapid – providing a strong base for LTE
2. Huawei SingleRAN meets our customers’ LTE need – and drives them to demand converged RAN
3. Most analysts are picking Huawei in the top 2 in LTE – ahead of Alcatel-Lucent
Given their current position, it seems that their goals are reasonable. But Huawei can be beaten – they are
not without fault or flaw. The LTE market is young enough that anything can happen and momentum can be
changed. We must attack them head-on to be sure they don’t establish a strong foothold.
This package explains Huawei’s product and position – then addresses “How do we compare?” and “How do
we counter?”
Financials
Most telecom vendors struggled in 2009, yet
Huawei had strong increase in revenues
Huawei targets 20% increase again in 2010
Market share
Huawei: RAN Market Share – 2007 to 2009
In 3 years, Huawei has risen from a small
player to #3 rank in the RAN infrastructure 2007 2008 2009
market Total 4.1% 10.3% 18.1%
Strong share in all technologies GSM 5.7% 10.6% 19.5%
Only weak spot is the NAR region CDMA 1.6% 5.8% 16.4%
WCDMA 3.2% 15.0% 19.1%
Analyst Opinions
Analysts reflect market perception, but they also can
influence operator decisions. What they say matters.
• IDC commented in April: “The rest of the vendor community
will have to play catch up to Ericsson and Huawei.”
• Gartner also ranked Huawei high, particularly in their ability
to execute (see the chart on the right).
Source: Gartner
Operator Engagements
• In October, Huawei claimed to have 25 trials – since Huawei claims 10 contracts ???
Beating them requires that we know them well and attack them head-on:
• Sales: (1) Attack specific Huawei weaknesses, (2) Question their value as a partner (spread FUD)
• PM/marketing: (1) Fix our product gaps, (2) Meet Huawei head-on in the marketing wars
To remain among the leaders, Huawei must win one of the big European-based operators:
•Vodafone, Telefonica, T-Mobile, etc.
This section describes Huawei’s current position – and digs beneath the surface.
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Huawei LTE Market Position
What the Analysts are Saying
The rest of the vendor community will have to play catch up to Ericsson and Huawei.
IDC, April 2010
By many analysts’ tallies, Huawei is creeping up on
No. 1 infrastructure supplier Ericsson, The race is on with traditional
particularly in the LTE equipment sector. That’s market leader Ericsson taking the
partly because the scions of telecom, including early lead and fast rising Huawei
Nokia Siemens Networks (NSN), Nortel in aggressive pursuit.
Networks, Alcatel-Lucent and, yes, even IDC, April 10.
Ericsson, have a hard time pricing their products
as low as Huawei does.
Huawei, ZTE … are pretty
Thanks to these factors, Huawei is landing major much shoo-ins for a large
3G and 4G deals around the world – much of the percentage of the [China
reason it expects an almost 30 percent increase Mobile TD-LTE] contracts.
Huawei is likely to gain a
in sales for the year. And Huawei is making good share of the LTE SRG, June 10.
headway not just in emerging markets like infrastructure market, with
Africa, but in areas where NSN, Nortel, Alcatel- more early momentum than
Lucent, Ericsson and others tend to reign. Press it had in the 2G/3G sector.
report Jan10 Gartner, May 2010.
Reading these reports makes you believe that ALU and NSN are in a battle for 3 rd place.
•Danger: Analyst opinions can shape our customers’ initial opinions.
•Reading deeper into the reports, much of their opinions are based on information provided by Huawei!
•Our analyst relations team is working to shape the analyst opinions to be more favorable to ALU.
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Huawei LTE Market Position
LTE Trials
Huawei claims to have 60 LTE trials.
This shows the ongoing trials we can identify.
Note they are active in all regions. T-Mobile
Trial Mobilkom
Vodafone Trial
Trial
US Cellular TMN Swisscom
Trial Trial Trial China Mobile
Expo (TDD)
Cox
Telefonica
Trial
Trial
Softbank
Trial
Telecom Italia
Trial
Cricket
Trial CMCC-HK
Zain
Trial
Trial
MTS Uzbek.
STC Trial
AMX Telstra
Trial Etisalat
Trial Trial
Trial Maxis
Trial Singtel
Trial
KEY
Huawei’s claim of 60 trials compares to 45 from ALU, 45 from E/// and 25 from NSN.
Trial (public)
• We believe Huawei’s number is inflated - including lab demos, double-counting, etc.
Trial (rumored)
ALU has fewer claimed trials, but we are certainly not behind:
• In US, we have as many trials + two big awards
• In China, we’re working with both CMCC and CT – Huawei only CMCC
• In Europe, we have 10 placements vs. their 11
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Huawei LTE Market Position
LTE Contracts
SingleRAN
Operator Assessment Award date Comments
Huawei claims 10 “LTE a factor?
Huawei won phase 1 (with E///) and reportedly
commercial contracts” 1 TeliaSonera Replaced by NSN
Phase 1: 01-09
performed well. However in phase 2 bidding, NSN bid
Phase: 01-10
• The list on the right shows the lower and replaced Huawei.
10 we think they’re talking Huawei will provide LTE as well as large-scale
about. Not all are legitimate. modernization of 2G/3G networks. Value €170M over 6
Telenor years. Huawei won based on “technical quality,
• Note that Huawei’s claimed 2
(Norway)
Significant win November 2009
reliability and commercial terms”.
Yes
number is 2nd only to NSN. We Telenor says this partnership could extend to other
don’t think NSN’s number is Telenor properties outside Norway.
valid either. Huawei lists China Mobile as a “commercial customer”,
• Note the impact of SingleRAN 3 China Mobile Shanghai Expo November 2009 but the only activity right now is the Shanghai Expo –
in the contract awards. we don’t think Huawei is being paid for it.
Proximus Huawei will upgrade the entire network, starting with
4 “LTE ready” November 2009 Yes
(Belgacom) 2G and 3G. No dates given for deployment of LTE.
Contracts Huawei is sole winner of LTE network that will cover
Vendor Net4Mobility all of Sweden by end of 2013. Also includes expansion
claimed 5 Significant win December 2009 Yes
(Sweden) of GSM network by 30-50%. Ericsson claims Huawei
ALU 3 won on price, not superior performance.
Huawei and NSN reportedly will win T-Mobile Germany
6 T-Mobile ?? April 2010 business, but no public announcement … and no Yes
E/// 5
contracts signed yet.
Zain Huawei built an “experimental LTE network” for Zain.
Huawei 10 7 Trial only May 2010
(Saudi Arabia) (So did Motorola and Ericsson.)
Wind Rollout of HSPA and LTE networks – plus IMS, fiber,
NSN 12 8
(Italy)
Significant win June 2010
network design/build.
Yes
MTS Huawei building trial network. No announcement of
Moto 2 9 Trial only? October 2009
(Uzbekistan) commercialization of LTE.
Huawei supplies 3G equipment to MTS in Armenia.
MTS/K-Telecom
ZTE 5 10 “LTE ready” ?? When LTE network is built, Huawei will get the Yes
(Armenia)
business.
Only 3 on Huawei’s list are confirmed and See “LTE CI Market Position” in marketing toolbox for other vendors’ contract lists.
represent true, near-term LTE contracts. http://wireless.app.alcatel-lucent.com/marketing_toolbox/competitive_intelligence/lte.htm
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Huawei LTE Market Position
2G/3G Market Share
2G/3G Market Share is an important predictor for future LTE sales.
This is particularly true for Huawei sales of the last 2 years, because these networks have been delivered
on the SingleRAN platform – allowing an easier transition to LTE.
Be careful with market share and financial results for Huawei. Since Huawei is not publicly traded,
getting hard numbers on shipments/revenues is difficult. They are often overstated.
Note the discrepancy within a single news report in January 2010:
•“Global telecom major, Huawei Technologies claims achieving the number one spot for wireless base station
shipments in the year 2009 overtaking market leader Ericsson.”
•“Its market share in the global telecom gear market stood at 20.1% at the end of Q3 2009 as compared to market
leader Ericsson’s 31.6% as per market research firm, Dell’Oro Group.”
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Huawei LTE Market Position
Is SingleRAN Fueling 2G/3G Growth?
The BTS3900 was launched in 1Q 2008
•This makes Huawei the first vendor to deliver a “next gen base station”
•Huawei is delivering most new GSM, CDMA and WCDMA networks via the BTS3900 family
•New BTS3900s are being portrayed as “LTE Ready”, whether LTE is planned or not.
•If today’s deployments are engineered right, LTE HW can be inserted in empty slots
•This builds a base of networks that should be “easy wins” for Huawei in LTE
Deployment status
•According to Huawei, 30 operators have adopted the BTS3900 over 50,000 sites.
Typical
•Industry analysts have slightly more conservative figures:
exaggerated
–Current Analysis says 10,000 units were deployed by April 2009 claim from
–TBR says 1.5 million TRXs were shipped by June 2009 Huawei
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Huawei LTE Market Position
… Or will 2G/3G Renovation Fuel LTE growth?
awarded to Huawei
Feb 2010
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Huawei LTE Market Position
How to Attack their Position?
Strengths Issues
•Aggressive behavior • Poor Reputation
• Low prices, high promises • History of inconsistent performance; Credibility issues
• Rapid expansion of 2G/3G base • Security concerns from government and business
• Chinese base and backing provide safety net • Exaggerated trial/contract counts are normal
•Product • Can they Win the Big Ones?
• SingleRAN provides entry, with promise of LTE • Often included in bids simply to lower the price
•Market performance • Will major operators be willing to depend on them?
• Contract wins lend credibility: Telenor, Net4Mobility • Rapid growth
• Trial participants everywhere • Will it put pressure on already weak services business?
• Can they maintain their low-cost profile while
supporting multiple markets and multiple generations?
• The SingleRAN concept says one platform can support all RF technologies
• Huawei LTE delivery is in a similar timeframe to E/// and ALU; a little ahead of NSN
The other leading vendors also offer converged RAN for 3GPP RF (GSM, WCDMA, LTE).
• Only Huawei and ZTE cover all leading RF technologies.
• The difference is in the details – OA&M support, shared antennas, how many boxes required, etc.
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Huawei LTE RAN Product Description
Portfolio Overview
The BTS3900 is Huawei’s LTE eNodeB
• All configurations are based on three common units (BBU, RFU, RRU)
• Supports GSM, W-CDMA, CDMA, TD-SCDMA, WiMAX and LTE
• Single OA&M system works with any RF technology
• BTS3900 first introduced in 2008; 2G/3G base stations already deployed
BTS3900C
DBS3900
BTS3900 BTS3900A
(Indoor) (Outdoor) RRU RFU
BBU
Huawei presents this as a complete, fully flexible portfolio. Two counterpoints:
• Only the distributed eNodeB was available in the first LTE release – macro, micro later
• Only two RF technologies can be supported at one time in a BBU – more than 2 require 2nd BBU
See Sections 3a/3b for more details on BTS3900
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Huawei LTE RAN Product Description
SingleRAN Concept
SingleRAN is Huawei’s marketing story re: BTS3900 evolution
• The idea is that you can deploy multiple networks using a single design/platform (e.g. GSM + UMTS)
• After deploying one technology, you can evolve the base station to add a 2 nd (see diagram)
• Advantages of SingleRAN:
1. Single BTS for multiple technologies simplifies OA&M, wiring, backhaul, real estate, etc.
2. BTS3900 is a modern/green base station, so it will be more cost effective than the old equipment
3. Operator can deploy BTS3900 today – and decide which next-gen technology to use later
4. Once BTS3900 is deployed for one technology, adding a second is cheap and easy (no overlay)
Huawei was first to market with SingleRAN – but other vendors offer similar advantages.
For example, Cosmote says Huawei SingleRAN saved 70% in footprint and 60% in energy over their old
GSM/UMTS equipment. This is true, but similar results would come from using anyone’s new equipment.
See Section 3c for more details on SingleRAN evolution.
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Huawei LTE RAN Product Description
BTS3900 LTE Roadmap
2009 2010 2011
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
FDD
eRAN1.0 eRAN2.0 eRAN3.0
Huawei is delivering it’s OA&M capabilities in stages – in a similar timeframe as all LTE vendors.
Huawei may have an edge with the single OA&M system that runs 2G, 3G and LTE.
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Huawei LTE RAN Product Description
Caution
The following sections give detail on Huawei’s LTE/SingleRAN product offer and
should help the reader to clearly understand what operators will get from Huawei.
Some of the information comes from Huawei, thus it is reliable only “in theory”:
• In other words, it clearly describes what they are promising.
• It doesn’t necessarily describe what they will actually deliver.
We often get comments from field trials that Huawei has used prototypes or has
adjusted parameters to ensure successful results. For example, one customer
commented that: “Huawei used March 09 alignment (instead of the required June 09) and
their mobile is not compliant with 3GPP Cat 3 definition.”
While this practice is not unusual (for any vendor), it is particularly common in this
fast-paced LTE market where customers want everything sooner than vendors are
ready to deliver.
Pay attention to the red boxes on each page – they provide the ALU counterpoint to
Huawei’s claims.
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Huawei’s LTE RAN
3a Baseband/Radio
Huawei LTE Elements
BBU3900 Baseband Unit
The BBU3900 is the digital baseband unit for the BTS3900 family and is used in all
configurations. It supports one or two technologies simultaneously (GSM, CDMA, WCDMA,
TD-SCDMA, WiMAX, LTE). The BBU3900 is 2U high, 310mm deep and 19” rack mountable.
Macro Macro
Indoor Outdoor
BBU
Distri-
buted
Micro
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Huawei LTE Elements
BBU3900 Control and Modem Cards
The BBU3900 chassis has eight slots into which different cards will be inserted based on the
technologies being supported. A working BBU will require a control card plus multiple
modem cards. (Some technologies will also require other special-purpose cards.)
The LTE control card is the “LMPT”
•The LMPT goes into slots G or H
• Two can be equipped for redundancy
•The LMPT has built-in FE/GE opt/elec interfaces
The LTE modem card is the “LBBP”
•The LBBP goes into slots A through F
F A E •Each LBBP card has 6 CPRI interfaces, but only 3 are
B F
PWR used currently
A C G •Note: In the first release of Huawei’s LTE BBU, the
N D H
PWR modem cards were double-height. In the second
release, they are now normal (single) height
Capacity
• Cells per LBBP: 3, each 2x2 MIMO @ 20 MHz
• 172 Mbps DL/57 Mbps UL per UE
Specifications
• Size: 84 x 446 x 310mm (HxWxD)
• Weight: 12 kg (full configuration)
• Power supply: -48VDC, +24VDC
• Power consumption: 250W max
• Temp range: -20 to 55 C
Specs:
WCDMA RFU: 4 carriers, 80W total
mRFU: 3 carriers, 60W
LTE RFU: 2 carriers, 40W each
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Huawei LTE Elements
RRU3201/RRU3203 LTE Remote Radio Head
The RRU3201 is Huawei’s original LTE RRU and has been used in early deployments.
In May 2010, Huawei filed a report with the US FCC for the RRU3203. This new RRU
looks identical to the RRU3201, with minor specification differences (see below).
RRU3203 differences
Twin TRX:
Two Tx, two Rx, one feedback channel
Each channel supports one carrier
Output power:
40W per antenna port
Measured: 36.3W to 37.2W
Other Specs:
Frequencies: 700/AWS/2600 Only 700 filed with FCC
The RRU3808 appears to be based on the RRU3804, Huawei’s flagship WCDMA base
stations. The hardware is “LTE ready”, needing just a software upgrade to be able to
support both WCDMA and LTE (in the same frequency).
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Huawei LTE Elements
RRU3908 GSM/WCDMA/LTE Remote Radio Head
The RRU3908 is Huawei’s newest RRU – supporting GSM, WCDMA and LTE. The hardware
is “LTE ready”, needing just a software upgrade to be able to support LTE.
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Huawei LTE Elements
Compare with Other LTE Vendors
Height 2U 2U 1.5U 3U
Baseband Unit
GSM, WCDMA,
RF techs LTE CDMA, TD-SCDMA, GSM, WCDMA, LTE GSM, WCDMA, LTE
supported GSM, WCDMA, CDMA planned
WiMAX, LTE
LTE carriers / 2 / 2x40W
Radio Unit 2 / 2x40W 3 / 3x60W
output power (LTE RFU)
Huawei Strengths:
Huawei Issues:
• BBU can support multiple technologies
• BBU can only support 2 technologies
• Radio units can support multiple
simultaneously
technologies
• Availability dates are floating
• Small BBU cards for flexibility
• Why was RRU3201 replaced?
• Integrated GE interfaces
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Huawei’s LTE RAN
3b Configurations
Huawei LTE Configurations
DBS3900 Distributed Base Station
The DBS3900 is Huawei’s solution for overlaying existing networks and for applications with
space constraints. It initially consisted of two parts: the BBU3900 and the RRU3201.
• It supports other RRUs as they become available.
• The RRUs support daisy-chaining, so there can be more than 3 RRUs.
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Huawei LTE Configurations
BTS3900 Indoor Macro
The Indoor Macro BTS meets ultra-high capacity requirements for dense urban application.
Capacity
6 carriers, 2x2 MIMO (12 total)
40W per channel
Interfaces
RFU FE or GE (elec. or opt.)
Specifications
Size: 900 x 600 x 450 mm
Weight: 120 kg (typical)
Power Consumption: 2400W
(6 x 2x2MIMO @ 10MHz)
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Huawei LTE Configurations
BTS3900A Outdoor Macro
The Outdoor Macro single cabinet BTS will also be applied in high capacity situations, but
is in an enclosure for outdoor deployment. Options are provided for different sizing and
for inclusion of batteries.
Capacity (single)
3 carriers, 2x2 MIMO
40W/channel
BBU Capacity (double)
RFU
6 carriers, 2x2 MIMO
40W/channel
Interfaces
FE or GE (elec. or opt.)
Specifications
Size: 900 x 600 x 450 mm
Power Consumption: 2440W
Standard size Standard size Double size (6 x 2x2MIMO @ 10MHz)
(w/ batteries)
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Huawei LTE Configurations
DBS3900 Outdoor Distributed Base Station
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Huawei LTE Configurations
BTS3900C Micro Outdoor
The Micro is targeted at “suburban applications, blind spots, and hot spots”. Note that the
BTS3900C has not been marketed for LTE yet, but is part of their CDMA and WCDMA offer.
RRU3804
(or RRU3201?)
The availability of the micro is unclear. Sometimes it is shown,
BBU3900 sometimes a pico is shown. There are no firm delivery dates
for either one.
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Huawei LTE Configurations
Compare with Other LTE Vendors
Huawei Strengths:
• Full range of options
Huawei Issues:
• All configurations built from same
elements • Many, confusing options
• “Mature” base station design • Uncertain small cell direction
• All RF technologies available
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Huawei’s LTE RAN
SingleRAN/Evolution
3c
Huawei’s SingleRAN
BTS3900 Supports Multiple Technologies
The BTS3900 is designed to be the only base station that the operator needs to deploy. It
was released in 2008 and has been deployed for GSM, CDMA, WCDMA and WiMAX
applications. LTE (FDD and TDD) is the next technology to be added.
BBU 3900
The BBU3900 can contain two control boards, therefore can
support two technologies simultaneously. If there is empty
space in an existing BBU, you can add a 2nd technology by
adding appropriate control and modem cards.
RFUs
The macro radio shelf can contain 3 to 6 radio units. Again, if
there is empty space, you can add a new RFU into any empty
slot. (If mRFUs are deployed, you could do a software upgrade
to change an existing one to support LTE.)
RRUs
Huawei has multiple flavors of RRU, several of which support
multiple technologies (in a single frequency band). You can
reuse an appropriate existing RRU or deploy a new one.
Since the BBU, RFU and RRU are the key elements in all BTS3900s, any of the configurations
can be easily upgraded – macro indoor, macro outdoor, micro and distributed.
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Huawei’s SingleRAN
SingleRAN Examples
These pictures show how to add LTE to an existing WCDMA deployment. Note addition of
hardware required in both baseband and radio elements.
BTS3900 (WCDMA only) BTS3900 (WCDMA+LTE)
W W W W W W
C C C C C C L L L Any tech RFU
D D D Add 3 LTE RFUs D D D T T T can be plugged
M M M M M M E E E into any slot.
A A A A A A
DBS3900 (WCDMA+LTE)
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Huawei’s SingleRAN
BBU3900 Options
The key cards in the BBU are the control and modem cards (as discussed in the last
section). Because of the independence of the BBU slots, multiple combinations of
technologies can be supported.
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Huawei’s SingleRAN
Radio Units
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Huawei’s SingleRAN
Example: WCDMA/LTE
Huawei BTS3900 WCDMA networks are “LTE Ready”. This means the operator can deploy
LTE without replacing equipment, however they still must upgrade SW and/or HW.
New HW for
different
band
HW upgrade
required
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Huawei’s SingleRAN
Example: WCDMA/LTE
New WCDMA+LTE network
Existing WCDMA network Each base station has 3 5MHz WCDMA carriers
Each base station has 3 5MHz carriers And 1 20MHz LTE carrier
Transmission Transmission
F PWR F LTE modem
PWR
A A WCDMA modem LTE control
WCDMA modem
N PWR N WCDMA modem WCDMA control
PWR
WCDMA modem WCDMA control
Capacity:
Capacity:
•Each WCDMA modem card supports 3s2c
•Each WCDMA modem card supports 3s2c •Each LTE modem card supports 3s 2x2 MIMO (@20 MHz)
• Could deploy 2 or 3 modem cards
depending on growth planning
Interfaces:
Interfaces: •2 FE connections to network for WCDMA (1 from
WCDMA controller, 1 from transmission card)
•2 FE connections to network (1 from
WCDMA controller, 1 from transmission card)
•3 CPRI links to RRUs (from modem cards)
•3 CPRI links to RRUs (from modem cards) •1 GE connection to network for LTE (from LTE modem
card)
BBU engineering isn’t consistent across technologies, so the operator must design the
WCDMA network with the intent to upgrade to LTE. Otherwise, change can be difficult.
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Huawei’s SingleRAN
Example: GSM/LTE
Two steps in this evolution:
1.Addition of GSM 1800 and LTE 2600
2.Reduction of GSM900 – replaced with LTE900
If the GSM900 was deployed using MRFUs instead of GSM-specific RFUs, the second
step can be done via software instead of replacing RFUs.
G G G L L L G G G L L L
1 1 1 2 2 2 1 1 1 2 2 2
8 8 8 6 6 6 8 8 8 6 6 6
0 0 0 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0 0 0 0
G G G G G G
9 9 9 9 9 9 G G G G G G G G G L L L
0 0 0 0 0 0 9 9 9 9 9 9 9 9 9 9 9 9
0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0 0 0 0
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Huawei’s SingleRAN
SingleRAN Realities
Huawei portrays SingleRAN evolution as a simple upgrade, typically requiring only
software. Let’s look a little closer at some of the real limitations.
New radio and New radio and BBU Empty space required for
BBU hardware hardware simple upgrade. Does
operator want to initially
deploy half-full macros?
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Huawei’s SingleRAN
SingleRAN@Broad
What is it?
At Mobile World Congress 2010, Huawei unveiled their SingleRAN@Broad marketing campaign, discussing
expansion of mobile broadband to LTE and beyond.
This continues their recent history of rolling out new campaigns at MWC:
2008 – Fourth Generation BTS; 2009 – SingleRAN; 2010 – SingleRAN@Broad
The diagram on the right shows the basic
principles of SingleRAN@Broad:
Be Careful: This is not a product/offer. There are no specific Huawei products mentioned.
Any vendor could draw this chart.
• “SingleRAN” is a concept with specific current products that support it.
• “SingleRAN@Broad” requires future developments like LTEAdvanced to achieve the promised results.
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Huawei’s SingleRAN
How to Position Against It?
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4 Huawei’s LTE RAN
How Do We Win?
Beating Huawei
Introduction
Huawei is Formidable – but NOT Unbeatable
There are three general directions we can take to attack Huawei:
The next page has a summary of Huawei’s strengths and weaknesses. Following that are ideas for
attacking Huawei – organized in the 3 categories listed above.
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Beating Huawei
Strengths/Weaknesses
Strengths Issues
•Low prices • History of inconsistent performance
•High promises • Credibility issues
• Security concerns due to government/military links
•“Guaranteed” China volume helps scale
• Growth and globalization will put pressure on their
•R&D strength in numbers and accomplishments low-cost profile
Business
•Customer-centric approach (quickly bring • Still not fully embraced by operators, often brought
resources to bear on customer hot buttons) into bids simply to lower prices
•Turning corner from tier 2 vendor to major • A weak reputation in the professional services
player in wireless infrastructure market compared to Ericsson, NSN and ALU.
• Huawei is currently challenged by ZTE for 3G
leadership in China. To lead worldwide, Huawei
must lead in its domestic market.
•Strong presence in LTE trials • Still selling boxes, not end-to-end
•Wins with TeliaSonera, Telenor, Net4Mobility • Loss at TeliaSonera!
•Strong growth in wireless (GSM, CDMA, WCDMA) • Marketing says “software upgradable”, but most
•Single base station for all technologies upgrades require some new hardware
LTE
•2008/2009 deployments are “LTE Ready” • Capacity limitations on LTE dual-mode BBU?
•Flexible BBU-based solution • No evolution path from older base stations (pre-
•“Easy” evolution to LTE BTS3900); requires overlay with new hardware
•Strong “green” marketing => reduced TCO
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Beating Huawei
Attack Market Position
Ideas:
Attack Huawei’s
• ALU is a tier 1 vendor, Huawei just want to be
claimed “leadership • How many trials does Huawei really have?
position” • How many significant contracts does Huawei really have?
• ALU has Verizon and AT&T plus a long list of significant trials.
• Huawei won TeliaSonera … but then lost it
• Huawei is a recent large contributor to standards bodies – ALU has
been a leader in 3GPP and 3GPP2 for years
Messages:
•“End to end LTE solution leader”
•Huawei is unclear in their EPC, ecosystem, transport solutions
Attack Huawei’s •ALU has leading solutions in IMS, applications, META, …
marketing messages •“Green solution. TCO savings.”
•Many of their claims are based on generic LTE advantages
•We can also demonstrate TCO savings with our solutions via Bell
Labs Modeling
•“Software Defined Base Stations”
•Most of H’s base station evolutions require new HW, not just SW
•SDR? We’ve done it for years. We’ve also led in the
development of MIMO, SON, OFDM, beamforming, flat IP …
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Beating Huawei
Attack Product
Examples:
• SingleRAN’s biggest differentiator was time-to-market – Huawei doesn’t
Attack Huawei’s have a TTM advantage for LTE
• The BTS3900 BBU has engineering restrictions and capacity limitations
LTE offer
• Their EPC solution is evolved from their GSM/WCDMA mobile core
• Limitations in OAM tools and methodical/structured procedures
Areas:
• Huawei still has a small embedded base
• You need an embedded base in order to evolve it
Attack Huawei’s • We have CDMA and HSPA market leadership
evolution story • The Huawei evolution story is focused on the new BTS3900
• Evolution from previous versions is weak/ignored
• Churn, churn, churn – evolution requires new hardware/software
Reports:
Attack Huawei’s • The BTS3900 looks good on paper. How does it really perform?
• Recent outages in Canada reflect poorly on Huawei (see next slide)
BTS3900 performance
• Reports from China indicate Huawei is missing promises, slipping
deliveries and delivering reduced capacity solutions
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Beating Huawei
Example of Product Failures
In late February, a major impacting network outage that lasted in the
3G Network Outage at Bell regions of 4 hours in Toronto that degraded 3G data services in Telus and
Bell networks. Toronto is Huawei's main market. The feedback from local
Canada and Telus Mobility, teams was that Huawei's capacity claims or engineering dimensioning did
February 2010 not support the traffic demand and did not live up to expectations,
possibly the Radio Network Controllers (RNC) were under provisioned. Our
local sales teams confirmed that Bell Mobility network outages were
caused by a failure in Huawei's RNC in the Bell network and their technical
“ Bell had a six hour degradation on two teams were still investigating this case.
RNCs last Friday. According to TELUS the
RNCs were under provisioned so they were
running hot. Telus and Bell Mobility RAN Based on information from the Sales Teams, it seems that Telus SGSN
share so an outage actually effects both” (provided by NSN) was ‘flooding' Bell 's RNC (provided by Huawei) with
(Alcatel-Lucent Canadian Teams) traffic (Multi-Operator Core Network - MOCN environment). The amount of
concurrent traffic generated by the Telus SGSNs caused the degradation in
Bell 's Huawei RNCs. Some of the causes of the failure may have been
“Many Telus and Bell 3G (Apple iPhone, problems with the SGSN configuration in Telus, bad dimensioning of
Blackberry Bold, HTC Hero) users Huawei's RNC or any bug in RNC/SGSN. However, independently of the root
experienced a 4 hour outage in the Greater cause of the failure the RNC should arguably have been more resilient
Toronto Area yesterday. Service was during the overload. This event questions whether Huawei's RNC provides
resumed last night. The cause of is the issue the Telco grade high traffic performance that is expected in demanding
still remains unknown, but Telus says it was markets.
caused by a “3rd party vendor”. All users More details available at ‘Alerts’ : http://wireless.app.alcatel-
are advised to perform a soft reset on their lucent.com/marketing_toolbox/competitive_intelligence/wireless.htm
handset”
Source:
- Sales Teams
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Beating Huawei
Use FUD
Examples:
• Huawei’s a privately held company and their financials are “non-
transparent”
Attack Huawei’s • Huawei reports strong growth in “contracts”, not “revenues” – not always
credibility the same thing
• Won’t talk directly about financing from the Chinese government
• Repeated reports of ethical problems
• Governments have security concerns, including reports of spying by
employees and close ties to the military (note recent problems in India).
Examples:
•Huawei is investing in local resources now … it will take sometime for these
teams to be well established
Attack Huawei’s
•Limited professional service capabilities
•They’re experiencing rapid growth. How will it impact them?
lack of maturity •Can their support structures handle the growth?
•Can they be a true global vendor (rather than low-cost box vendor)?
•They buy market position via low entry costs – when do they cash in?
•Limited experience with tier 1 operators
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Beating Huawei
More FUD
Examples:
• Promises made in sales cycle must be negotiated post contract –
often creating costly changes
Attack Huawei’s • Huawei notorious for under-pricing an initial deal, only to gouge the
track record customer on future needed features and licenses
• Huawei has a history of discontinuing product lines deployed in the
field requiring costly upgrades or replacements over time
• Huawei creates a false appearance of being responsive, e.g., Flying in
100’s of people from China to fix a problem
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5 For Further
Information
For Further Information
Marketing Toolbox for Competitive Intelligence
http://wireless.app.alcatel-lucent.com/marketing_toolbox/competitive_intelligence/lte.htm
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For Further Information
Wireless CI Forum
For the ‘wider Wireless community’ (GSM, CDMA, WCDMA, Mobile NGN and LTE). Allows discussion on
news, products, issues, field experiences, knowledge sharing and expression of opinions related to
Wireless infrastructure competitors
http://forum.app.alcatel-lucent.com/viewforum.php?f=236
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www.alcatel-lucent.com
www.alcatel-lucent.com
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