FACTBOX-What does the new LTE mobile technology offer?

Wed Feb 10, 2010 9:55am EST

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Feb 10 (Reuters) - U.S. telecoms carrier AT&T (T.N) picked Ericsson (ERICb.ST) and Alcatel-Lucent (ALUA.PA) to build its fourth-generation mobile network, one of the first major orders for the new Long Term Evolution technology. [ID:nLDE6191MK]

Here are some facts on the new technology, which will also be one of the key topics at the world's largest wireless trade show, Mobile World Congress, next week in Barcelona:

LOWER OPERATING COST AND NEW CAPACITY

- Mobile telecoms operators are set to invest billions in the LTE networks as data traffic in their current networks has exploded due to the use of mobile data cards and smartphones.

- LTE is not expected to boost sales significantly, particularly in mature markets, but lower operating and expansion costs and new spectrum are the key reasons for any operator to invest in the new technology.

- LTE is not much more bandwidth efficient than advanced 3G. The five to six times higher capacity will be mainly the result of using four times more radio spectrum, said Mikko Valtonen, technology specialist at Rewheel consultancy.

- Chetan Sharma Consulting has said evolving to HSPA (advanced version of 3G) and LTE will result in cost savings of almost $25 billion a year across all U.S. operators by 2013.

NOT THE SPEED

- LTE network technology promises data download speeds of up to 100 megabits per second, but typically the speed would be 10-30 megabits per second, on par with 3G networks.

- For typical Internet usage 1-2 Megabits per second is enough.

- From a consumer perspective, a much bigger boost to mobile data usage has come from the development of 3G technology, which started from just 0.4 Megabits per second, but with HSDPA upgrades jumped to several Megabits per second.

PRICE

- To make economic sense, the cost of rolling out an LTE network cannot be more than a fraction of the money that has been spent on 3G rollouts, and the cost of incremental capacity upgrades has to be less than a tenth of the cost of adding to HSPA networks, according to Rewheel.

- "LTE does not revolutionise the technology. As such, gear makers need to fundamentally change their commercial equipment pricing approaches in order to deliver on the promise of slashing cost per megabyte," said Antonios Drossos, managing partner at Rewheel.

- Building a standalone network for LTE is rarely viable. Instead, operators prefer swapping their outdated 2G and 3G gear for advanced all-in one solutions.

Source: insights.rewheel.fi/ (Reporting by Tarmo Virki)

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