Editor’s Note: Welcome to our weekly Reality Check column. We’ve gathered a group of visionaries and veterans in the mobile industry to give their insights into the marketplace.
A decade ago, you could go to any wireless industry trade show and be absolutely sure of seeing at least one thing: a PowerPoint slide showing wireless data usage climbing a hockey stick that even Wayne Gretzky would covet.
That vision became reality a few years ago, and the growth shows no signs of leveling off anytime soon. In just the past year, global wireless traffic increased 160% to 90 petabytes per month (the equivalent of 23 million DVDs, according to a report earlier this year Cisco Systems Inc.). By 2014, wireless traffic is expected to increase 39-fold to 3.6 exabytes per month, Cisco predicts. Some perspective: That growth rate is 2.4 times more than what Cisco forecasts for the wired broadband world.
So it’s worth looking at how wireless carriers in the Americas plan to accommodate these trends. (After all, the Latin American region by itself is now the world’s second-largest mobile market after Asia-Pacific, according to Informa Telecoms & Media.) The next 12 months will be pivotal, as many operators across the Americas upgrade and dramatically expand their 3GPP mobile broadband networks to deliver the faster speeds and advanced services that the region’s consumers and business users increasingly demand.
How fast is fast?
If mobile users already know anything about LTE and HSPA+, it’s that they’re fast. But ask them – or even many people in the wireless industry – to quantify that speed, and the responses will range from a blank look to, “A few meg, right?”
Table 1 sets the record straight by providing the theoretical peak speeds for each technology, along with the real-world typical average user rates for the mobile broadband technologies that are commercially deployed.
As Table 1 highlights, for any wireless technology, it’s important to understand how it’s deployed in order to quantify its capabilities. For example, not all HSPA+ networks are created alike. Some use dual-carrier architecture to increase the peak theoretical download speed to 42 megabits per second.
For both HSPA+ and LTE, spectrum directly affects speed. For example, as Table 1 shows, an LTE network that uses 20 megahertz of spectrum can support theoretical peak speeds of 326 Mbps with 4×4 MIMO. If that operator has only 10 megahertz available, the peak speed drops to 70 Mbps with 2×2 MIMO. The importance of having enough spectrum to allow LTE to perform its best is critical in this world of growing demands for wireless data services that use tremendous capacity on the network.
Supplying mass market mobile broadband at high speeds efficiently is one reason why 3G Americas, and now 4G Americas, have been so focused on working with the region’s regulators to free up more spectrum so that HSPA, HSPA+ and LTE can live up to their full potential in terms of meeting the market’s needs.
There’s another reason why spectrum is so important: It’s a proven economic development tool, one that’s desperately needed in the worst recession in 70 years. Spectrum auction proceeds would provide immediate revenue from governments, with additional revenue coming from the jobs and other spending as mobile operators aggressively increase their investments in new networks. According to analyst firm iSuppli Inc., following two years of declining expenditures, global capital spending on wireless infrastructure equipment is set to return to growth in 2011 as carriers in the developed world start deploying next-generation 4G networks. It should be noted by regulators and policy stakeholders in the Americas and throughout the world, that the millions and sometimes billions of dollars in new mobile broadband investments in LTE networks over the past 12 months have come almost exclusively in situations where the operator has purchased or been allocated new spectrum. New spectrum, new investment, new jobs, new infrastructure, new backhaul, new devices, new jobs all equal a better economy.
Finally, backhaul also affects speed. In the Americas and the rest of the world, many mobile operators – such as AT&T, T-Mobile, Am
