4G forecast for 2011

The worldwide LTE subscriber base will reach 6.52 million in 2011. Leading LTE operators will be Verizon Wireless (USA) and NTT DoCoMo (Japan), with 2.66 million and 2 million subscribers respectively.

There will be a cumulative number of 219 LTE commitments, 71 trials and 57 commercial deployments for the FDD-LTE standard; and 26 commitments, 12 trials and 4 deployments for TDD-LTE.

TDD-LTE will be used as an extender of network capacity in 2011 (TDD femto/picocells will be implemented). Telefonica O2 (Germany) could become the first commercial adopter of this approach, using FDD for outdoor coverage and LTE TDD for urban capacity.

Europe and North America will be the leading regions in terms of commercial LTE deployments, accounting for 22 and 15 respectively.

The global Wimax subscriber base will reach 18.87 million in 2011. The regions with the greatest contribution of Wimax subscribers will be North America and Asia-Pacific, with 8.5 million and 4.74 million subscribers respectively.

The number of Wimax deployments will slightly decrease for the first time ever in Europe. The failure of several greenfield operators to run profitable Wimax services, and the momentum of LTE gaining commitments from all mobile carriers, are the reasons for this decrease from the current 164 to 159. However, the number of subscribers will increase considerably, from 1.38 million to 2 million, because of Yota’s delayed switch to FDD-LTE.

Wireless backhaul will recover from the market size reduction it has suffered in 2010. Innovative wireless backhaul technologies such as e-band, free space optics and NLOS backhaul (point-to-multipoint) will help to increase market size to close to US$ 5 billion.

TD-LTE (2.3 and 2.6 GHz) and NLOS backhaul (also in 3.5 GHz) systems will make use of the spectrum left vacant by former Wimax deployments. NLOS backhaul will focus on 3.5 GHz (available worldwide except in the US), since it is the only band among those covered by Wimax that is not being addressed by TD-LTE. However, the deployment of TD-LTE by most of 2.6 GHz spectrum licensees is not certain, so there are also chances for NLOS backhaul deployments in that band. The 2.3 GHz band, under-utilized in the US, poses another good opportunity for both technologies.

There are many indications from major mobile operators such as China Mobile, NTT DoCoMo in Japan, and Taiwan’s Chunghwa Telecom that femtocells will play a big part in their network rollout strategy starting next year. Maravedis predicts that this larger group of operators will boost the adoption of femtocells across the world more quickly than originally anticipated. Femtocell pricing will continue to be a barrier for widespread adoption. However, we expect the price to fall to as low as US$70-80 in 2011 from its current US$100 price. We further expect the demand for femtocells will be highest in 2012, when upfront payment is expected to be below US$50.