Newsletter: H3 lands Danish LTE license nearly for free

Is Hutchinson 3 the smartest of the bunch?

The 2.5 GHz frequency auctions in Denmark are all over and the winners are - surprise surprise - all four incumbent mobile operators! Each of had to pay about 45 million EUR for a 20 MHz paired band license (plus 10 MHz unpaired band in the case of Telia and Telenor), except for Hutchison 3, who opted for 10 MHz of paired band and 25 MHz of unpaired at just below 1 million EUR - that's just 2% of what the others paid. So did Hutchison 3 run off with the best deal? With TD-LTE gaining momentum worldwide, there's a lot to be said for the unpaired bands. It's definitely possible that 3 made the shrewd choice.

The quick analysis is this: "Regular" LTE (in paired bands) splits uplink and downlink traffic in bands of equal size, most often 20 MHz. This approach is followed largely for historical reasons, since telephony always requires equal bandwidths for up- and downlink. Mobile broadband data streams, on the other hand, proceed mostly from the network to the terminal (meaning in the downlink direction) while little bandwidth is consumed for uplink. So chances are that the uplink paired bands - up to 20 MHz per operator - won't be used much.

The TD-version of LTE is in this context rather more sophisticated: It takes a 20 MHz band and splits the data stream unequally and dynamically in time for uplink and downlink streams, which is much more efficient, and only reduces the overall performance - relative to "regular" LTE - with a few percent. So you get nearly the same result at half the bandwidth - and in the case of H3 in Denmark - at 2% of the license fee! TD-LTE is internationally on a roll with gigantic China Mobile leading the way and many more in the pipeline. For more about TD-LTE read the White Paper I co-wrote for the GSMA here.

Another way of understanding the H3 strategy is to view the paired band (10 MHz in this case) as sufficient for small screen devices (iPhone, HTC, etc), which don't chew up that much data because of the smaller screen, while the larger unpaired band may well be sufficient for large-screen devices, meaning dongles for ADSL-replacement or complimentary use in TD-mode.

Clever? Only time will tell, but it does make for a compelling argument.

I expect to have a White Paper (business case study) ready on this issue within a week or two written together with my partners at Ventura Team of the U.K. The paper will be applying the HETTING/Ventura techno-ecomomic LTE model, and it will be available for free on the www.hettingconsulting.com website, so watch this space. We will also shortly be taking a closer look at the prospective value of the Danish 800 MHz bands due to be auctioned off probably within a year or two.

Stockholm conference: LTE operators happy to be bit pipes

Suggesting that mobile operators are mere bit pipes used to be tantamount to profanity. But times have clearly changed, as speakers from both TeliaSonera and Telenor used the phrase freely at last month's LTE Forum conference in the LTE capital of the world: Stockholm. The highlight of the conference was the two operators’ hyped down but optimistic view of LTE. “An important thing about our LTE service is that the minimum data rate is as high as 2.3 megabits per second,” said Mats Lundbäck, network director of TeliaSonera Sweden at last week’s LTE conference.

That may not sound like a lot, but compared with the few hundred kbps or less you get with HSPA in the worst case, it is indeed a big step up. The modest baseline rate also shows how far operators have come in reducing LTE from hype to reality. According to Mr Lundbäck the average rates on the TeliaSonera Stockholm network are 15.7 and 4.4 mbps for uplink and downlink, respectively, at 10 MHz of bandwidth (these data rates are - I believe - from the Northstream.se study).  Read the rest of the story here.

Emerging markets: Is 'leapfrogging' to LTE a realistic option?

Inspired by an African gentleman that I met at the LTE conference last month, I've tried to dig into some of the issues surrounding the appealing concept of skipping 3G and evolving GSM directly to LTE. Sounds like a good idea if you want to save huge amounts of CAPEX, right? Right. But on the other hand there are challenges, perhaps the most pressing of which are availability of the right bands (e.g. in Africa) and the inherent lack of voice on LTE. To get a clear answer a business case and more research is needed, but I still believe it could be a compelling option for some. Read my quick report on leapfrogging here.

Mobile inspiration courtesy Mr Stephen Fry

I'm always on the lookout for people and stories that inspire, and here's a good one: British actor & author Stephen Fry is a self-confessed mobile techno-freak and has interesting things to say about - among others - Apple. You can find this excellent interview on the TelecomTV website here - it's highly recommended.

Date: 12-05-2010

Author: Claus Hetting

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