lte ebook no 1 - why now is the time

des

tinat

ion

LTE expressMOVE FAST AND OUTCOMPETE

To LTE or not to LTE?


Itin

erar

y LTE NOW

Time to get on board

Published February 2014

LTE is taking off

Customers are already on standby

Business wants LTE even more than consumers do

LTE ramps up subscriber data usage

Watch profits soar: reduce cost per bit by over 50%

Invest in your future, not in your legacy

Why Alcatel-Lucent LTE express


Maximum download speed:

3G - 14 Mbps

Maximum download speed:

LTE - 100 Mbps

Maximum upload speed:

3G - 5.8 Mbps

Maximum upload speed:

LTE - 50 Mbps

No standby with LTE

LTE is taking off The world is shifting to LTE. Can you

afford to let your competitors beat you

to that destination?

Operators around the world are investing

in LTE because consumers and businesses

want the speed and quality of fixed

broadband from mobile — and they want

it now. It’s why the first operator to

enter a market with LTE gains substantial

market share and revenue. While

operators that take a slower, more

conservative approach, risk share

loss and revenue decline.

For example, when Verizon partnered

with Alcatel-Lucent to introduce LTE in

December 2010, they realized increased

market share and ARPU, especially during

their first year of service. Similar results

have occurred to first movers throughout

the world.

Followers who deploy LTE quickly and

decisively also realize increased market

share and APRU when their services

are launched, although not to the same

extend as the first operator.

The longer an operator waits to offer LTE,

however, the less impact it will have. The

last national operator to offer LTE may

actually realize a decline in ARPU.

RETURN TO THE ITINERARY


63% of consumers consider

LTE important in

Smartphone purchases

Source: Fierce Wireless

16% of consumers would

switch service

providers to get

4G earlier

Source: eMarketer

70% of consumers

who switch to a

competitor do so

due to poor service

Source: McKinsey

4G

Customers are already on standby With faster speeds and better

performance, LTE is transforming

the mobile experience, just as fixed

broadband transformed the home

Internet experience.

LTE gives you the flexibility and agility

you need to create new kinds of

applications and services to generate

new revenues.

As more and more consumers move

their digital media libraries to the cloud,

the benefits of LTE are becoming crystal

clear. Streaming high-quality music or

HD video files can be a nightmare on

3G networks. Over an LTE network, it’s a

great experience. Customers can focus on

the content, not on network limitations

that can make them switch to another

operator.



What bene�ts did US businesses gain from LTE?

67%Increased

productivity

47%Helped

cut costs

39%Helped win

new business

What do U.K. businesses think of LTE?

94%LTE will be

an importantbusiness tool

84%Excited by

the prospectof introducing

LTE

>60%Intend to

deploy LTEwithin six

months of itsavailability

Source: EE

Source: Arthur D. Little

Business wants LTE even more than consumers do LTE is not only transforming the mobile

experience for consumers, but also for

enterprises, which see LTE as a trigger

for innovation and agility.

According to an Arthur D. Little survey,

76% of American businesses feel that LTE

has helped their organizations innovate

and jump ahead of the competition, and

86% feel that LTE enables them to get

more work done on the move.

Which departments benefit most from

LTE? 57% of survey respondents cited

Sales as the main beneficiary, followed

by Customer Services (40%), Operations

(39%) and Marketing (28%)

No wonder enterprises that don’t

have LTE want it. A survey by U.K.

operator EE found that, overwhelmingly,

businesses recognize the transformative

potential of LTE.

It’s a simple equation — if you offer

enterprises LTE before your competitors

do, you will win more business customers

than they will. Obviously, this is true of

many markets, not just the U.K.



LTE Subscribers Use More Data

36%Increase with

AT&T andVerizon LTEsubscribers

67%Increasewith LTE

subscribersin Japan

2xMore Net�ix

usage permonth for LTE

subscribers

29%More YouTube

usage permonth for LTE

subscribers

132%Increasewith LTE

subscribersin Korea

Source: Mobidia and Informa Telecoms & Media

LTE ramps up subscriber data usage Subscribers expect and get more from LTE

compared to 3G, so they use it more —

a lot more.

In the three leading LTE markets,

Japan, South Korea and the United States,

subscriber cellular data usage increased

substantially. LTE Smartphone users

in the U.S. consumed nearly

1.3 gigabytes of data per month,

compared to 956 megabytes per month

among 3G Smartphone users — an

increase of 36%. Data usage in Japan and

Korea increased much more, climbing a

remarkable 132% in Korea.

This is driven in part by LTE subscribers

using popular high-bandwidth

applications and services more often,

including Netflix, YouTube, Hulu and

Dropbox. With LTE, they can count on the

high quality experience they’ve grown

accustomed to with fixed broadband.



COST

TRAFFIC GROWTH

Start

3G

2x 4x 5x

57%LOWERCOSTPER BIT

10x

TCO advantage from LTE early deployment

LTE

LTE Small Cells

Virtualized RAN architecture

Path 1: Grow 3G. deploy LTE later

Path 2: Overlay LTE, densify with small cells, evolve to virtualized RAN architecture

Watch profits soar: reduce cost per bit by over 50%You need to increase capacity to satisfy

mobile user demand, but to remain

profitable you need to minimize TCO. A

rapid evolution to LTE meets both needs.

Bell Labs compared the costs of two

technology evolution paths, assuming a

10-fold increase in traffic over a five-year

period. On the first path, the operator

continues to densify its 3G network to

meet data demand and deploys LTE later.

On the second path, the same operator

overlays LTE immediately with

Alcatel-Lucent LTE express on existing

3G sites to satisfy data demand, later

densifies the network with LTE metro

cells and finally moves to a virtualized

RAN architecture.

The results? Path 2 achieves a 57% lower cost per bit than Path 1.

The main reason is that adding

capacity with 3G costs more than

LTE. The increased spectral efficiency

and bandwidth of LTE means that

the operator is building a lower cost

infrastructure and that offers more

options to scale.

Densifying the network with cost-

effective metro cells further improves the

economics, and capacity can be deployed

directly to where it is needed most.

Finally, evolving to a virtualized RAN

architecture increases capacity by

20% and reduces capital and operational

costs by 26%.



Slow transition to LTE

2010 2011 2012 2013 2014 2015 2016 2017 2018

2G

3G

LTE

100

75

50

25

0

Subsc

riber

s (%

)

Slow transition to LTE demands investing in both 3G and LTE, resulting in higher overall CAPEX

Fast transition to LTE

2010 2011 2012 2013 2014 2015 2016 2017 2018

100

75

50

25

0

Subsc

riber

s (%

)

Fast transition to LTE focuses investment towardthe future (LTE), resulting in CAPEX having“long life” depreciation

2G

3G

LTE

Invest in your future, not in your legacyIf you move quickly to LTE, you’ll

have less need to continue to invest

in 2G/3G networks because your LTE

network can handle the growing traffic

demand. Instead, you’ll invest in LTE, a

future-oriented technology that can be

depreciated over a longer term.

Using their Mobile Network Evolution

Tool, Bell Labs evaluated two LTE

migration strategies for a Tier 1

operator in Europe, one slow and

the other accelerated.

A slow migration, consistent with a

converged RAN approach, requires a

higher overall investment in legacy

3G networks. With this approach, the

operator is forced to make capital

investments that have a short-term

depreciation.

An accelerated migration with

Alcatel-Lucent LTE express quickly

transitions most subscribers and traffic

to the LTE network. This lets the operator

focus its limited CAPEX on the future.

Existing 2G/3G networks continue to

handle legacy services while the lower

cost per bit LTE network handles growing

mobile broadband traffic.



Why Alcatel-Lucent LTE expressYour destination is LTE, and we’ll get you there on an LTE overlay route that is faster, simpler and future proof. We have the

products, the experience and the services to help you rapidly deliver the outstanding LTE experience your consumer and business

enterprise customers are demanding.

FasterAvailable now: We deliver the fastest and furthest-reaching high capacity network.

Faster time to market: We have the right wireless and IP experience, expertise and services gained from deploying the world’s largest LTE networks. Our complete LTE overlay solution can be deployed in record time, beating all market estimates.

SimplerTurnkey solution: Market and network planning, site selection, network design, integration, backhaul, power, maintenance, SON and more.

Expertise of the world’s specialist in IP Networking and Ultra-Broadband Access with a leading portfolio spanning macro, small cells, backhaul, packet core and applications. We have built — and continue to build — the largest, highest capacity LTE networks in the world.

One throat to choke: We worry about project dependencies so you don’t have to.

Future-ProofScalable architecture: LTE overlay architecture designed for huge signaling and data plane scale.

Scalable networks: Near invisible and low power small cells increase network capacity up to 10x.

Scalable operations: Build, Operate, Transfer (BOT) delivers massive near term turn-up of resources when and where needed.

Ongoing Innovation: Backed by our innovation powerhouse Bell Labs, Alcatel-Lucent continues to bring advanced lightRadio™ technologies and products to market. Our LTE investment is shaped by the world’s largest and most aggressive FDD and TDD operators deploying Carrier Aggregation, VoLTE, eMBMS, virtualized RAN and small cell HetNets.

To learn more about how Alcatel-Lucent LTE express takes you to LTE sooner, contact your local Alcatel-Lucent sales representative.


lte ebook no 1 - why now is the time

Technology