Future Looks Bleak for Mobile Equipment Vendors

[Digital Puppy]

Future Looks Bleak for Mobile Equipment Vendors, Says Analysys

BARCELONA, Spain -- Feb. 11, 2008 It seems that mobile equipment vendors are facing an uncertain future, according to two new reports, 3G Network Evolution from 2007 to 2012: HSPA+, LTE, WiMAX and femtocells and 3G Infrastructure Sharing: the future for mobile networks, released today by Analysys Research, the global advisers on telecoms, IT and media (http://research.analysys.com) at GSMA Mobile World Congress in Barcelona (11-14 February).

"Mobile equipment vendors may be depending on 3G enhancements such as Long Term Evolution (LTE) to secure the future of their businesses, by enabling mobile operators to offer network-intensive services such as broadband services to the home and mobile TV services," said Dr Alastair Brydon, co-author of the reports. "However, our modelling shows that LTE may not be necessary at all."

The lack of a compelling business case for 3G network enhancements, combined with an increase in network sharing, will have a profound impact on the cellular network infrastructure market.

Key findings from the new reports include the following:

-- Mobile operators may not need the capacity gains offered by LTE, because mobile services will increasingly be delivered using alternative technologies, such as femtocells and broadcasting networks.

-- LTE will not be widely available before 2010, which is too late to play a significant role in the provision of broadband services to homes and businesses, because of the widespread availability of low-cost DSL and cable services.

-- T-Mobile and 3 in the UK announced in December 2007 that they had entered into a network sharing agreement. This announcement is indicative of a trend that is set to spread as operators struggle to expand 3G coverage and make funds available for alternative investments.

"3G network evolution is about to change course", says Dr Mark Heath. "With doubts about the viability of LTE, the move towards network sharing couldn't come at a worse time for network infrastructure vendors. It is imperative that vendors increase market share to compensate for the future consolidation of 3G networks."

The reports 3G Network Evolution from 2007 to 2012 and 3G Infrastructure Sharing are available to purchase online http://research.analysys.com/store or email [email protected].

A press summary of the report is available upon request.

Analysys provides strategy and management consultancy, information services and start-up support throughout the telecommunications, IT and media sector.