Workshop: Exploring Mobile OpportunitiesWorkshop: Exploring Mobile Opportunities

Mobile Broadband Market DynamicsMobile Broadband Market Dynamics

December 3, 2007

Joe LawrenceJoe LawrenceCDMA Development GroupCDMA Development Group

2www.cdg.org

CDMA2000: Strong Global PresenceCDMA2000: Strong Global PresenceCDMA2000 has built a strong ecosystem and enormous economies of CDMA2000 has built a strong ecosystem and enormous economies of scalescale

More than 274 274 operators in more than 108108 countries have deployed or are planning to deploy CDMA2000

1X EV-DORel. 0

EV-DORev. A

Commercial 238 80 14

In Deployment/Trial 33 56 34

CDMA2000 will continue to be the core business offering for CDMA2000 will continue to be the core business offering for hundreds of operators for well over a decadehundreds of operators for well over a decade

2www.cdg.org

Most leading service providers support more than four radio technologies:

Mobile Communications LandscapeMobile Communications Landscape

““One Technology Fits AllOne Technology Fits All”” or or ““One Network Fits AllOne Network Fits All”” strategy may no longer suffice in todaystrategy may no longer suffice in today’’s competitive marketss competitive markets

Increased complexity is defining the future landscape of telecomIncreased complexity is defining the future landscape of telecommunicationsmunications

VIVOVIVOAMPS

GPRS

CDMA2000 1xEV-DO

CDMA2000 1XcdmaOne

GSM

VerizonVerizon

CDMA2000 1X

CDMA2000 1xEV-DO

cdmaOne

MFLO

AT&TAT&T

GSM

EDGE

WCDMA

TDMA

GPRS

HSPA

MFLOVodafoneVodafone

GSMEDGE

WCDMA

GPRS

HSPADVB-H

NTT DoCoMoNTT DoCoMo

PDC

HSPAWCDMA

ISDB-T

SKTSKT

cdmaOne

HSPA

CDMA2000 1X

CDMA2000 1xEV-DO

S/T-DMB

Sprint NextelSprint Nextel

CDMA2000 1X

CDMA2000 1xEV-DO

cdmaOne

iDEN WiMAX

China MobileChina Mobile

PHSGSM

GY/T220.1-2006

GPRS

Bluetooth

GPS

GPSGPS

Bluetooth Bluetooth BluetoothBluetooth

Bluetooth Bluetooth Bluetooth

Wi-Fi Wi-Fi

2www.cdg.org

Network EvolutionNetwork EvolutionMultiple network technologies supported by a common IPMultiple network technologies supported by a common IP--based core networkbased core network

Different technologies for Different technologies for Different locations andDifferent locations and

Different servicesDifferent services

WLAN and broadcast technologies complement 3G WAN technologiesWLAN and broadcast technologies complement 3G WAN technologies

OFDMAOFDMA--based broadband networks based broadband networks will complement 3G WAN networkswill complement 3G WAN networks

2www.cdg.org

Service EvolutionService EvolutionEvolution from voiceEvolution from voice--centric 2G and 3G networks to next generation mobile centric 2G and 3G networks to next generation mobile broadband networks will take many yearsbroadband networks will take many years

CircuitCircuit--switched voice services over 3G WAN networks will remain in switched voice services over 3G WAN networks will remain in commercial use until next generation broadband networks are fullcommercial use until next generation broadband networks are fully y capable of delivering ubiquitous and less expensive carriercapable of delivering ubiquitous and less expensive carrier--grade grade

VoIP communicationsVoIP communications

Evolution from voiceEvolution from voice-- to datato data--centric telecommunicationscentric telecommunications

2www.cdg.org

Device EvolutionDevice EvolutionCDMA2000 multimode devices have and will support multiple radio CDMA2000 multimode devices have and will support multiple radio technologiestechnologies

Multimode/multiband CDMA2000 devices will play an important Multimode/multiband CDMA2000 devices will play an important role in delivering next generation mobile broadband servicesrole in delivering next generation mobile broadband services

Broadcast

PAN/LANBroadband

WAN

CDMA2000

UMBLTE

802.16m

MFLODVB-HISDB-T

S/T-DMB

Bluetooth802.11a/b/g

802.11n

GSMGPRSEDGE

WCDMAHSPAiDEN

2www.cdg.org

Next Generation Multimode DevicesNext Generation Multimode DevicesWorldModeWorldModeTMTM devices will include next generation broadband technologiesdevices will include next generation broadband technologies

WorldMode devices will continue to introduce WorldMode devices will continue to introduce multifunctional capabilities multifunctional capabilities

CDMA2000 1X + EV-DO + GSM + GPRS + GPSEV-DO Rev. A + HSPA + GPS

CDMA2000 1X + EV-DO Rev. A + UMB/LTE/WiMax + GPS

2www.cdg.org

Migration TimelineMigration TimelineWith an increasing number of subscribers, the migration process With an increasing number of subscribers, the migration process is lengtheningis lengthening

Putting things into perspective.Putting things into perspective. The generational migration process will take many years.The generational migration process will take many years.

Voice will remain the Killer Application.Voice will remain the Killer Application.

Migration of SubscribersMigration of Subscribers

2www.cdg.org

• A “One Technology Fits AllOne Technology Fits All” or a “One Network Fits AllOne Network Fits All” strategy may no longer suffice in today’s competitive markets

• OFDMA-based broadband networks will complement 3G WAN networks

• 3G WAN networks will remain in commercial use until next generation broadband networks are fully capable of delivering ubiquitous and less expensive carrier-grade VoIP communications

• Multimode/multiband CDMA2000 devices will play an important role in next generation mobile broadband services

• The migration to next generation networks will take many years

• CDMA2000 offers substantial long-term industry value

Key TakeawaysKey TakeawaysCDMA2000: Enabling the convergence of next generation wireless CDMA2000: Enabling the convergence of next generation wireless servicesservices

2www.cdg.org

Which industry and market dynamics are driving Which industry and market dynamics are driving the evolution to advanced broadband the evolution to advanced broadband

technologies and services?technologies and services?

What lessons have we learned?What lessons have we learned? What should the wireless industry do to sustain What should the wireless industry do to sustain

its remarkable growth?its remarkable growth?

2www.cdg.org

Given the nature of the standardization process and for reasons of international competitiveness, national standards, do not usually

succeed abroad.*

It took 2G technologies the better part of a decadedecade to find widespread adoption.*

Over optimism and growing pains are often intrinsic to the process that informs the introduction of any new technology.*

The migration to newer technologies takes longer, and is The migration to newer technologies takes longer, and is never as simple as it may seem.never as simple as it may seem.

Key Lessons LearnedKey Lessons Learned

Migration from 1G to 2G to 3GMigration from 1G to 2G to 3G

*Source: “Past as a Guidepost to the Future: Reflections on the Continued Growth of the Mobile Communications Industry”, IDC, September 2007

2www.cdg.org

Mobile network operators, like others engaged in network-based enterprises, prefer a graceful evolutionary change to a disruptive

revolutionary change.*

Graceful evolutionary change is preferred Graceful evolutionary change is preferred over disruptive revolutionary change.over disruptive revolutionary change.

Evolutionary ChangeEvolutionary ChangeKey Lessons LearnedKey Lessons Learned

*Source: “Past as a Guidepost to the Future: Reflections on the Continued Growth of the Mobile Communications Industry,” IDC, September 2007

2www.cdg.org

Network effect refers to the fact that a service becomes more valuable as more people use it, thereby encouraging ever-increasing numbers

of adopters.*

Building next-gen networks to non-standardized parameters would have introduced unnecessary complexity and fragmented the potential

subscriber base, raising the eventual cost of mobile devices as well as the cost of rolling out services.*

Critical mass can only be achieved with a common global Critical mass can only be achieved with a common global standard and set of deployment parameters.standard and set of deployment parameters.

Key Lessons LearnedKey Lessons Learned

Network Effects and Critical MassNetwork Effects and Critical Mass

*Source: Past as a Guidepost to the Future: Reflections on the Continued Growth of the Mobile Communications Industry, IDC, September 2007

2www.cdg.org

Given the high costs of R&D required for designing networks, devices, and services, industry players — both operators and their vendors —

must seek and realize economies of scale and scope to become or remain competitive.*

Enormous economies of scale are essential for any operator Enormous economies of scale are essential for any operator to be competitive in todayto be competitive in today’’s marketplace.s marketplace.

Key Lessons LearnedKey Lessons Learned

Economies of Scale and ScopeEconomies of Scale and Scope

*Source: Past as a Guidepost to the Future: Reflections on the Continued Growth of the Mobile Communications Industry, IDC, September 2007

2www.cdg.org

Satisfying this elementary user expectation of providing seamless uninterrupted coverage is essential for attracting and retaining

subscribers.*

A competitive footprint is essential,A competitive footprint is essential,no matter what type of wireless networks you deploy.no matter what type of wireless networks you deploy.

Key Lessons LearnedKey Lessons Learned

Coverage is King: Footprint MattersCoverage is King: Footprint Matters

*Source: “Past as a Guidepost to the Future: Reflections on the Continued Growth of the Mobile Communications Industry”, IDC, September 2007

2www.cdg.org

The success of any new technology depends on its ability to attract a critical mass of users; achieving this critical mass of users becomes very challenging when a new technology is deployed in a standalone,

isolated fashion.*

Affordable multiAffordable multi--mode devices are essential to the rollmode devices are essential to the roll--out out of any new technology of any new technology —— to build an early critical mass of to build an early critical mass of

profitable subscribers.profitable subscribers.

Key Lessons LearnedKey Lessons Learned

Island RollIsland Roll--out: Multiout: Multi--mode Devicesmode Devices

*Source: “Past as a Guidepost to the Future: Reflections on the Continued Growth of the Mobile Communications Industry”, IDC, September 2007

2www.cdg.org

Given that technological innovation depends on an infrastructure of knowledge, competence, and skills, arbitrarily changing technological

paths always carries the potential to undermine innovation and negatively impact the industry.*

The cost of switching evolution paths can be prohibitively The cost of switching evolution paths can be prohibitively expensive.expensive.

Key Lessons LearnedKey Lessons Learned

History Matters: Path DependencyHistory Matters: Path Dependency

*Source: Past as a Guidepost to the Future: Reflections on the Continued Growth of the Mobile Communications Industry, IDC, September 2007

2www.cdg.org

One of the principal ways that the mobile industry sought to achieve predictability was through the creation of a standardized radio service

environment that drove investor confidence, allowed systematic allocation of R&D resources, and resulted in innovation in services

and devices.*

Missteps caused by the uncertainty of a new technology Missteps caused by the uncertainty of a new technology have resulted in mobile operator and vendor consolidation.have resulted in mobile operator and vendor consolidation.

Key Lessons LearnedKey Lessons Learned

PredictabilityPredictability

*Source: “Past as a Guidepost to the Future: Reflections on the Continued Growth of the Mobile Communications Industry”, IDC, September 2007

2www.cdg.org

The coordination endeavor requires an appropriate discursive arena — usually a standard-setting body — in which industry players can meet

to discuss and resolve their concerns and build consensus in a productive and expeditious manner.*

The process of ensuring compatibility and interoperability The process of ensuring compatibility and interoperability across multiple industries requires efficient standardacross multiple industries requires efficient standard--

setting bodies, network maturity and business setting bodies, network maturity and business predictability. predictability.

Key Lessons LearnedKey Lessons Learned

Compatibility and InteroperabilityCompatibility and Interoperability

*Source: “Past as a Guidepost to the Future: Reflections on the Continued Growth of the Mobile Communications Industry”, IDC, September 2007

2www.cdg.org

Evolving an existing ecosystem is becoming increasingly necessary because the expertise that resides within the various elements that

constitute an attractive and useful mobile data service is often distributed across players from different industries.*

Increased network and business complexity is reinforcing Increased network and business complexity is reinforcing the need for a the need for a maturemature ecosystem to provision new services.ecosystem to provision new services.

Key Lessons LearnedKey Lessons Learned

Complexity and EcosystemsComplexity and Ecosystems

*Source: “Past as a Guidepost to the Future: Reflections on the Continued Growth of the Mobile Communications Industry”, IDC, September 2007

2www.cdg.org

To sustain its exponential growth,To sustain its exponential growth, the global mobile industrythe global mobile industry

would do well would do well to continue strengthening andto continue strengthening and

expanding its expanding its existingexisting ecosystem,ecosystem, even as it embraces andeven as it embraces and

assimilates newer technologiesassimilates newer technologies and players within its fold.and players within its fold.**

ConclusionConclusion

*Source: “Past as a Guidepost to the Future: Reflections on the Continued Growth of the Mobile Communications Industry”, IDC, September 2007