NASHVILLE, Tenn. — As fourth-generation network rollouts begin, the wireless industry’s value chain has viable buildout opportunities that should keep the sector healthy, as long as various segments work in harmony.
“4G wireless will be the game changer that we all expect and hope it will be,” said Verizon Wireless CTO Anthony Melone at PCIA’s opening keynote address to kick off the 2009 Wireless Infrastructure Show in Nashville, Tenn. Thus, the industry will begin to count connections, not subscribers. This massive buildout will require balance among the many companies that touch the network. “Each link in the chain must be strong.”
Having said that, Melone was frank with tower companies in the audience, telling them that expensive changes that increase his tower rents would impact the rest of the value chain. “If that balance gets out of whack,” tower owners end up losing out on incremental revenue. Likewise, he told the audience that most of the first phase of the carrier’s LTE deployment is using Ethernet over fiber because Ethernet over microwave is too expensive. The opportunities for backup power and femtocells and picocells are real opportunities for vendors, Melone said. Verizon Wireless’ technology decisions will be made around where the carrier can get the best long-term cost benefit and sustainable reliability.
Tuesday’s lineup included a number of breakout sessions touching on a variety of topics. About 1,200 people are attending the show, which continues through Thursday.
Buildout
“4G is about applications,” said WFI CEO David Porte, during a panel session yesterday. For the infrastructure industry, that means new spectrum, new base stations, new cell sites and new antennas.
Indeed, Nadine Manjaro, an analyst with ABI Research, said her firm estimates that Verizon Wireless will require 60,000 to 70,000 more base stations to build out its LTE network to mirror its CDMA network. Even as carrier and vendors talk about the possibility of reusing equipment, they are unlikely to take down their commercial 3G equipment to use it for 4G, Manjaro said. (Verizon Wireless was not represented on the panel and so did not comment on the number.)
4G deployments are more modular, noted Martin Jensen of Nokia Siemens Networks. One person can now carry what used to br delivered by van or crane.
Technology
LTE technology enables self-optimizing networks. During his keynote, Verizon Wireless’ Melone said the technology is interesting, but relying on technology to perform functions that people used to do makes him a little nervous.
The industry can also expect to see usage patterns change with 4G technology as people use services inside the home more than on highways, said Ross Manire of ExteNet.
Tower siting
Tower siting remains a source of conflicts with municipalities, and likely will continue to be an obstacle as 4G networks require more coverage in residential areas. A recent court decision by the U.S. Court of Appeals for the Ninth Circuit is giving tower-siting executives some reason to hope on future siting issues. T-Mobile USA Inc. sued the city of Anacortes, Wash., after the city denied a 116-foot monopole T-Mobile USA said it needed to build in the area. The Ninth Circuit in essence said that the city shares an equal burden to find a viable alternative if it denies a site, said Scott Thompson, an attorney with Davis Wright Tremaine, who worked on the case.
As cities lose revenues due to the tight economy, they are more open to siting towers on their property to recover some lost funding, but that movement also brings with it some concerns because the city-owned property is not always the best technical location, said Hal Hodges of MetroPCS Communications Inc.
T-Mobile’s Ann Brooks said her company has been more proactive on tower-siting issues and recommends tower industry leaders work with civic groups, planning associations and individuals “outside the pressure cooker of the hearing” to explain the benefits of wireless – and the need for towers – as local residents demand coverage in their homes, as a source of revenue in the city and as a tool first-responders need. “Do proactive outreach before, during and after the application process cycle,” Brooks said.
