Jim Orr is a principal network architect in the wireless market development group at Fujitsu Network Communications.
Q: It seems the infrastructure market has experienced some turbulence over the past several years. How do you view the strength of the infrastructure market today?
A: We are in a period of rapid adoption. Personal broadband — devices with acceptable performance for gathering and disseminating data — are becoming more and more common outside of the traveling executive market segment. With the increased capabilities, comes increased adoption and service expansion. This drives order of magnitude technology deployments such as LTE and WiMAX. The point to all of this is that the next generations of wireless technology will be deployed when it is technically feasible by someone — whether it is incumbents or new entrants. This gives Fujitsu great optimism about the future of the infrastructure market.
Q: How is Fujitsu positioned along the technology front in North America as wireless carriers begin their transition from 3G to 4G networks?
A: Fujitsu has two very significant wins in the wireless space, KDDI for WiMAX and NTT DoCoMo for LTE, providing us with anchor tenants for our technologies and ensuring long-term presence in the market. Neither of these companies desires a Japan-only technology and have required their vendors to commit to globally deployable products. Fujitsu is well recognized in N.A. for its optical infrastructure product portfolio. A combination of our excellent wireless pedigree, customers that will lead the global technology deployment and a large existing telecom supplier footprint in the U.S. puts us in a great position to help our customers move to the generation of wireless services.
Q: LTE, WiMAX, UMB. Is there a place in the industry for the bevy of next-generation technologies?
A: WiMAX has the advantage of the flexibilities an IEEE standard allows and the costs advantage of a more dispersed IPR profile. It also has a significant time to market advantage as mobile WiMAX networks are already being deployed. WiMAX will deliver the data rates the consumers demand while greatly increasing the reliability of the network. LTE is the logical upgrade path for the 3GPP participant carriers. New entrants will also enjoy the significant design efforts that will be behind the devices supported by LTE. UMB suffers significantly from the declining market share for 3GPP2 technologies (CDMA, EVDO) — which is now less than 15%. UMB was dealt a very hard blow when Verizon decided to move to LTE for its next generation technology. With the exit of one of the top-tier wireless carriers, the future of UMB is pretty bleak.
Q: Some carrier executives have recently called on a more unified approach to network evolutions that might include a variety of standards. What is Fujitsu’s position on a move to a more unified approach?
A: There is significant reuse of WiMAX and LTE development, allowing for higher level of integration of parts of the solution. So, yes, there is a more unified approach built into the next round of technology in that the reuse of the design effort is significant. How it will appear in the market place, however, will likely be in multi-mode PC’s, terminals, and handsets. Handsets are smart enough now that it is not at all unreasonable to picture a handset that can speak to LTE, WiMAX or HSPA — depending on the best network for the consumer. We do not believe that their will only be one certified technology that everything merges into within the planning window. There are enough differences between LTE and WiMAX that they should be both maintained so carriers have options as they make their decisions.
Q: Where do you see a majority of Fujitsu’s business coming from in the near-term?’
A: Fujitsu currently markets the Airspan WiMAX product line, and have been since 2005. We have been successful in generating revenue from those products for some time and will continue to do so. We see opportunities for mobile WiMAX maturing late in 2008 with significant ramp in 2009. The LTE market, while garnering much of the hype, is still in its infancy. The first US carrier to deploy LTE will likely begin this deployment in 2010. We will continue to generate the majority of our revenues from our optical and services portfolio while we win business for WiMAX and LTE.
Q: What impact if any do you expect from the 700 MHz auction on infrastructure business?
A: The 700 MHz auction provides wide swaths of clear spectrum that performs extremely well for the initial deployment of any wireless technology. The signals travel long distances and penetrate walls quite well. A new technology is typically deployed for coverage first and capacity as customers adopt the technology, so deployment in 700 MHz is desirable. The adoption of broadband wireless services requires the availability of very wide sections of clear spectrum. This only exists in the AWS 1.7/2.1 GHz FDD spectrum band and the new 700 MHz band. The clearance of the 700 MHz band enables the nearly unfettered deployment of new technology at a much lower cost to the carrier than you would see in the AWS band. You would think this would be a bad thing for infrastructure business, as it results in a lower number of base stations deployed for initial network implementation. However, what it really does is makes for a better business case for the carriers as they can ramp their capital expenditure to meet demand and minimize the initial capital expenditure that is not supported by near term revenue. Fujitsu is very excited about expanding our portfolio with our wireless solutions. We have secured and stable large-scale customers for both WiMAX and LTE. We have strong programs to support our customers for both of these technologies. Services is also a good opportunity for us as any time a large scale deployment rolls out, resources are stretched thin and carriers look to their suppliers to help them out. We are here to do just that.
