View - OFTA

1 (2)
18th June 2004
Office of the Telecommunications Authority
29/F Wu Chung House
213 Queen’s Road East
Wanchai
Hong Kong
Attention: Senior Telecommunications Engineer (Technical Regulation)2
Fax: 2803 5112
Email: [email protected]
Dear Sir,
Re:
Licensing of Mobile Services on Expiry of Existing Licenses for Second Generation Mobile
Services – Analysis of Comments Received, Preliminary Conclusions and Further
Consultation
Referring to OFTA consultation paper on 800 MHz spectrum use in Hong Kong, Nokia is pleased to provide a
response in form of this letter and three appendices attached:
- June 19th mobile market status update from Nokia Networks
- Openness
- Nokia High Speed Packet Access Solution
Hong Kong is one of the world’s leading mobile markets in terms of innovativeness and adaptation of
technologies. Co-operation and collaboration between the industry parties – regulator, operator and suppliers –
has made this development possible. In mobile industry technologies are becoming global, but divided between
two major standards paths 3GSM and CDMA remains today. On the back of our experience in both Hong Kong
mobile market, and other markets globally, we feel that the following considerations are of a great importance,
when frequency and technology decisions for the Hong Kong market are being made:
Open globally standardized and adopted service platforms enable fastest uptake of mobile data services.
The contributing factors of open standards include: high versatility of terminals, higher range of local and global
applications through broadly adopted development tools, easy interoperability between operators, as well as
roaming capability. We discuss the power of openness in specific white paper, enclosed in this response (please
refer to annex no. 2, “Openness”). Also, in our “market update” we have included many examples service uptake
using open platforms, including 230 MMS networks, launched within two years (please see annex no. 1, “June
19th mobile market status update from Nokia Networks”). Especially we would like to make a point that in an
environment with several technology platforms with limited or no interoperability with each other– such as the
case today is between 3GSM and CDMA – the introduction of new services is subject to more testing and
integration. This can both delay launch of new services in the market, as well as require more resources from the
industry thus making the process more costly.
1. WCDMA platform, with HSDPA (High Speed Downlink Packet Access) upgrade, provides clearly
highest end-user quality experience, as well as the highest spectral efficiency. As a result, the
consumers, the operators and the government get a substantially higher utility of the deployed spectrum,
in comparison to any other alternative options. HSDPA is a 3GPP standardized evolution step in WCDMA
platform available in 2005. In Nokia implementation this feature is easily implemented via a software
upgrade only. At its full capability, the consumers get peak downlink speed of 14.4 Mbps, with typical
average speeds across the network varying between 1-3 Mbps in loaded network conditions. Similarly,
the uplink enhancement will be available through High Speed Uplink Packet Access, delivering peak
speeds of 5.8 Mbps in uplink with typical speeds of around 1 Mbps in loaded network.
The performance of the HSDPA network is brought to the utmost limit. In fact the HSDPA modulation
performance closely approaches the “Shannon Limit”, which defines the maximum theoretical bandwidth
that can be achieved with a given amount spectrum bandwidth. Together with the benefits of the
NOKIA (H.K.) LIMITED
16/F Cityplaza 4, 12 Taikoo Wan Road,
Taikoo Shing, Hong Kong.
Tel : (852) 2597 0100, 2967 3388
Fax : (852) 2563 7301
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wideband (5 MHz) signal, the HSDPA network performance is significantly better than any other available
option can provide. Even if the same advanced modulation was applied with a narrowband technology,
the HSDPA performance benefit would still be significant
Due to the smooth evolution and high performance, we expect each WCDMA 3G operator to rapidly
deploy HSDPA and HSUPA. We have enclosed a white paper on HSDPA/HSUPA technology in case
OFTA would like to undertake a more detailed study (please refer to annex no. 3, “Nokia High Speed
Packet Access Solution” for more details).
2. WCDMA/HSDPA solution will be available for the 800 MHz spectrum band which is planned to be
refarmed in Hong Kong - in the right time for HK market. 3GPP (Rel.6, TS25.104) has specified the
use of WCDMA in the 800 MHz band (824-849 MHz paired with 869-994 MHz), under the definition
“UMTS 850”.
The initial demand for 800 MHz band WCDMA solution will be in the North America, Latin America, and in
Asia Pacific, starting from 2005. In the Americas there is a subscriber base of over 100 Million in 800 MHz
TDMA and GSM systems, and a large share of that base will migrate to 800 MHz WCDMA/HSDPA
networks in the coming years. In Asia Pacific there are un-deployed 800 MHz frequencies available in
most countries, and as a result many operators have confirmed their interest on the 800 MHz
WCDMA/HSDPA solution. Also these operators in APAC have a combined user base approaching 100
Million in 2004, (likely exceeding 100 Million in 2005).
When the 3G licencing in China will proceed, we expect also a high demand for 800 MHz WCDMA among
the Chinese operators. The combination of 800 MHz band coverage benefits, and WCDMA/HSDPA
performance benefits provides a highly lucrative solution, especially when the WCDMA coverage build will
proceed to less urbanised areas. The user base in China in 2004 is around 300 Million (likely over 400
Million by 2006).
The confirmed demand for the 800 MHz band WCDMA solution is large and will without doubt lead into
broad-based supply of networks and terminals. The first WCDMA terminal chipset manufacturers have
publicly announced WCDMA chipset with support of 800 MHz band. Further, the first operators have
already requested high-volume network and terminal offerings from several vendors. As a result of the
high demand from many markets, Nokia has decided to develop systems for the 800 MHz band using
WCDMA/HSDPA technology. System deliveries will start in 2005.
By taking the above considerations into account we are confident that WCDMA/HSDPA solution would be the
best option for the 800 MHz band in Hong Kong, for consumers, operators and government alike.
On behalf of Nokia we would sincerely like to thank OFTA for offering an opportunity to respond to the
consultation paper of “Licensing of Mobile Services on Expiry of Existing Licenses for Second Generation Mobile
Services – Analysis of Comments Received, Preliminary Conclusions and Further Consultation”. We hope the
views offered by Nokia in this response will help OFTA in forming the regulations for the use of 800MHz in Hong
Kong. Naturally, should OFTA have any further questions or should OFTA like Nokia to clarify any of the views
offered in this response, we would be very pleased to address those to the best of our capability.
Yours Sincerely,
Marko Tiesmaki
Director, Mobile Systems
Asia Pacific
Bruce Lam
General Manager, Hong Kong & Macau
Customer and Market Operations
Mobile Phones
Mobile market status
update
Summary
3G market
Global mobile market
Mobile data market
User-experienced bit rates
June 19th 2004
Nokia Networks
1
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Mobile market beyond voice
is growing rapidly
Source: Public sources; Press releases; Strategy analytics, MDA; Forbes; Mobile
Media; Nokia;Wireless Imaging (updated end May 2004)
Mass market
High growth phase
SMS, ringtones
and logos
Browsing and
application downloading
!
Approx 1.6 billion SMS/day
globally
!
Mobile ring tones are
already a multi-billion USD
business
!
Over 20 operators globally
>15% of ARPU from data
2
© NOKIA
Imaging services
3G
WCDMA
• 33 commercially
launched WCDMA
networks with 5.9
million subscribers
• 70+ million camera
handsets were sold
2003 ( overtaken sales
• Most handsets sold have
of traditional digital
color displays and packet
cameras)
• WCDMA handset
data
launches
• 230 operators globally
• WAP page impressions
have launched MMS. Est. accelerating, with
doubled last 12 month in
4 MMS sent /month per
over 40 WCDMA
UK – now 1.4 billion / page
active user
handsets launched
impressions per month
globally
• >40 operators launched
• Explosive growth in
video services
application downloads >
15 million Java downloads /
month
Presentation_Name.PPT / DD-MM-YYYY / Initials
3G WCDMA Market
3
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
3G users have higher voice & data ARPU
Source: NTT DoCoMo
12000
3G
10000
3G
2G
2G
8000
Data ARPU
3G
3G
2G
2G
6000
Voice ARPU
4000
2000
0
2003/4-6
4
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
2003/7-9
2003/10-12
2004/1-3
33 Commercial WCDMA networks today
3 UK
VF UK
Proximus BE
3GIS SE**
3 DK
3 SE
Tele2 SE
VF PT
TeliaSonera SE
VF ES
Mobitel SL
Telefonica Moviles ES
VF IT
Launched
commercial
3 IT
TIM IT
Supplied by
Nokia
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
VF KK JP
Cellcom IL
3 HK
3 AT
Connect AT
tele.ring AT
Mobilkom AT
VF DE
T-Mobile DE
5
NTT Docomo JP
MTC-VF BH
Optimus PT
TMN PT
**Shared network,
no own license/
subscribers
VF SE
VF NL
SFR FR
Based
ased on public sources
TIM GR
Cosmote GR
3 AU
Based
ased on public sources
16 Pre-commercial WCDMA networks
8 supplied by Nokia
Orange UK
TMO UK
Sonera FI
Orange FR
SKT KR
Vodafone IE
KT KR
O2 DE
O2 IE
Tele 2 LX
Maxis MY
Etisalat UAE
T-Mobile AT
Launched
precommercial
Supplied by
Nokia
6
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Manx Telecom
Dialog GSM LK
Telekom MY
Planned WCDMA launches EMEA 2004
Orange NL
KPN NL
Orange UK
Telenor NO
TMO UK
T-Mobile NL
PTL LX
Orange LX
Manx Telecom
Wave telecom
Guernsey
KPN BASE BE
Mobistar BE
O2 IE
Radiolinja FI
TDC DK
O2 UK
TeliaSonera DK
Orange FR
T-Mobile AT
3 IE
VF IE
Partner IL
Xfera ES
Amena ES
KPN E+ DE
O2 DE
Swisscom CH
Launch 2004
Sunrise CH
Based on public sources
7
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Orange CH
WIND IT
Panafon VF GR
Etisalat UAE
Planned WCDMA launches EMEA 2005 ->
3 NO
Finnet/DNA FI
Telia NO
Ålands MT FI
Tele2 EE
EMT EE
Telfort NL
LMT LV
Bouygues FR
Omnitel LT
PTC PL
Polkomtel PL
Eurotel Cz
T-Mobile Cz
Launch 2005->
8
© NOKIA
Based on public sources
Presentation_Name.PPT / DD-MM-YYYY / Initials
Centertel PL
Planned WCDMA launches
China, APAC and Americas 2004 ->
CMCC CH
SKT KR
AWS US
KT KR
Smartone HK
TCC TW
CSL HK
CHT TW
Sunday HK
FET TW
Maxis MY
TM MY
Starhub SG
M1 SG
Singtel SG
Smart PH
Telstra AU
Optus AU
VF AU
Launch 2004
Launch 2005->
9
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
VF NZ
Telstra NZ
Telecom NZ
Based on public sources
~5.9 million WCDMA subscribers end of May 2004
• Attractive terminals boost the subscriber uptake
7 000 000
6 000 000
Mobitel
MTC VF
3 Hong Kong
3 Denmark
3 Sweden
mobilkom
5 000 000
4 000 000
3 000 000
2 000 000
Source: EMC database, TCA Japan,
press (7.6.2004)
1 000 000
M
ar
-0
M 2
ay
-0
2
Ju
l-0
2
Se
p0
No 2
v02
Ja
n0
M 3
ar
-0
M 3
ay
-0
3
Ju
l-0
3
Se
p0
No 3
v03
Ja
n0
M 4
ar
-0
M 4
ay
-0
4
0
10
© NOKIA
3 Austria
3 Australia
3 Italy
3 UK
J-PHONE
NTT Docomo
Presentation_Name.PPT / DD-MM-YYYY / Initials
120 WCDMA licenses awarded by March 2004
cumulative number of licenses
160
number of licenses
60
140
50
120
40
100
30
60
40
There are now 120 WCDMA
20 licenses in IMT-2000 band awarded
worldwide in 40 countries.
0
10
11
© NOKIA
APAC
Hong Kong
80
20
0
Europe
1999
2000
2001
Presentation_Name.PPT / DD-MM-YYYY / Initials
2002
2003
WCDMA 3G terminals picking up
- Not just quantity but also quality has improved significantly during the last two years
60
50
Number of different brands&models
of WCDMA terminals
available in the market*
40
30
20
10
0
1H02
2H02
1H03
2H03
1H04
* DoCoMo and 3GPP standard included
12
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Current WCDMA 3GPP Terminals
NEC e808
NEC e616
NEC
e909
NEC e606
Nokia 6630
Sharp V-801SH
SonyEricsson Z1010
Nokia 7600
NEC e808S NEC e808N
NEC e808Y NEC c313
Nokia 6650
Siemens U10 Siemens U15
Samsung SGH-Z105
Vodafone datacard
Motorola A830
Motorola A835
Motorola A845
Sanyo V-801SA
NEC V-N701
LGE U8100/
U8150
13
© NOKIA
Motorola A920
Motorola A925
Motorola A1000
Presentation_Name.PPT / DD-MM-YYYY / Initials
Motorola V1000
Sanyo V-SA701
Seiko VF connect
card VC701SI
Global Mobile Market
14
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Subscribers per technology – by Q1 2004
Millions
Subscribers per Technology - Global
1100
1000
900
800
700
600
500
400
300
200
100
0
Growth Q1/04: 3GSM
CDMA
CDMA
APAC
20M
5M
TDMA
China
10M
3M
Lat Am
6M
2M
USA
4M
3M
Europe
17M
0M
Global
55M
13M
80%
20%
GSM
Q2 2003 Q3 2003 Q4 2003 Q1 2004
Source of data: EMC, May 2004
15
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
GSM fastest growing in all
market areas, taking 80% of
all new subscribers
Subscriber growth by technology in APAC
Millions
Subscriber growth by technology in APAC (cumulative)
90
80
70
60
CDMA
50
GSM
40
PDC
30
20
10
0
Q2 2003
Q3 2003
Q4 2003
Q1 2004
Source of Data: EMC May 10th 2004
• GSM in clear lead in APAC subscriber growth – with 81.1 million new subscribers during the last 12 months
• GSM takes 76% of all growth in APAC
16
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
GSM and CDMA subscribers in China
Millions
GSM and CDMA subscribers in China
275
250
225
200
175
150
125
100
75
50
25
0
GSM
CDMA
Q2 2003
Q3 2003
Q4 2003
Q1 2004
Source of data: EMC May 2004
• GSM has over 10 times more users than any other technology in China
• GSM taking 77% of all subscriber growth in China
17
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
GSM and CDMA subscribers in India
Millions
GSM and CDMA subscribers in India
30
25
20
GSM
15
CDMA
10
5
0
Q2 2003
Q3 2003
Q4 2003
Source of data: EMC May 2004
18
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Q1 2004
Subscriber growth in Latin America
Millions
Subscriber growth per technology in Latin America
7
6
5
4
CDMA
3
GSM
2
1
0
Q1 2003
Q1 2004
Source of data: EMC May 10th 2004
• GSM has moved to lead subscriber growth
• GSM will surpass CDMA in cumulative user numbers during 2004
19
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Subscriber growth in the USA
- Q1 2004 versus Q1 2003-
Millions
Net subscriber additions in the USA
5
4
3
2
CDMA
1
GSM
0
-1
Q1 2003
Q1 2004
-2
-3
-4
Source of data: EMC, May 10th 2004
• GSM leading subscriber additions in the USA
20
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Global Mobile Data Market
21
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Gl
ob
e
Sm Phi
li
NT art P ppin
e
T
Do hilip s
Co pin
Mo es
J
KD apa
Vo DI n
da Ja
Vo fone pan
da
J
fon apa
eI n
re
lan
Td
Mo
bil
O2
eC O U
ze 2 I K
ch rel
Re and
p
Vo O2 ublic
da G
fo er
T- ne G man
Mo e y
bil rma
e
n
Ne Ger y
tco ma
m n
Te No y
l
Si eno rwa
ng r N y
Te o
l S rwa
ing y
e
T- por
Mo e
b
SK O ile U
Te ran K
lec ge
om UK
Vo Kor
KB da ea
Im fon
e
p
Mo uls UK
bis Ru
ss
t
Ce ar B ia
nt elg
Pr erte ium
ox l P
im
u ola
E- s Be nd
Mo Pl
l
bil us gium
eO Ge
ne rm
Si any
ng
ap
or
e
Data as % of Revenue
Top 25 operators in mobile data revenue - Q4 2003
- 23 of leading 25 operators have GSM and/or WCDMA
- 1 has CDMA with planned evolution to WCDMA (SKT)
- 1 has CDMA only
Top 25 operators in Data as % of Revenue - 4Q 2003
40.0
22
35.0
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
GSM/WCDMA
PDC/WCDMA
CDMA
30.0
25.0
20.0
15.0
10.0
5.0
0.0
Source of Data : EMC World Cellular Data Metrics, March 2004
Millions
GPRS/EDGE
clearly
leading
global
mobile
data
subscriber
growth
Subscriber growth per quarter
Data subscriber growth during 2003 (quarterly growth)
12
10
8
GPRS
6
CDMA2000 1X
4
2
0
Q1 2003
Q2 2003
Q3 2003
Q4 2003
Source of data: EMC World Cellular Data Metrics, March 2004
Technology share of data subscriber growth
80%
70%
60%
50%
GPRS
40%
CDMA2000 1X
30%
20%
10%
0%
Q1 2003
Q2 2003
Q3 2003
Q4 2003
Source of data: EMC World Cellular Data Metrics, March 2004
23
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Multimedia Network launches Jan 2003 May 2004 (cumulative per quarter) 121 128
108
47
57
97
85
44
33
21
17
6
8
EMEA
Americas
1Q-03 2Q-03 3Q-03 4Q-03 May-04
Last column May includes
all launches in Jan-May 2004
& first all launches until March -03
1Q-03 2Q-03 3Q-03 4Q-03 May-04
Source: Public sources and Nokia, May 2004
© NOKIA
37
APAC & China
1Q-03 2Q-03 3Q-03 4Q-03 May-04
24
50
Presentation_Name.PPT / DD-MM-YYYY / Initials
Already over 230 operators provide MMS
Countries where
MMS launched
Region
EMEA
APAC & CHINA
AMERICAS
TOTAL
MMS Networks
128
57
47
232
Region
May2004
Source: Nokia and public sources
25
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
EMEA
APAC & CHINA
AMERICAS
TOTAL
No of countries
with MMS
53
19
21
93
Global Status of MMS Interconnection
National interconnect in 30 countries in March 2004
Number of MMS
roaming agreements
growing steadily
Countries where
MMS launched
In APAC: Singapore
Taiwan and Hong Kong have
full interconnection with all
operators
Countries with MMS
interconnection
In markets where operators have multiple technology
platforms interconnection is generally delayed, and
consequently service uptake is slower
26
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
MMS networks in EMEA
In Europe MMS is very
widespread and established
service. Good subscriber growth
both in Western and Eastern
Europe
Launched 2002
Launched
2003/2004
In Africa totally seven operators offer MMS
Democratic Republic of the Congo: Vodacom
May 2004
Nokia and Public Sources
27
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Nigeria: Globacom
South Africa: MTN
South Africa: Vodacom
Carriers is Americas are ready to exploit MMS –almost 50
operators offer MMS
MMS network
launches have
accelerated in
Americas
this year
Launched
Nov.03
May.04
Nov.03
Apr.04
Oct-02
Feb-03
Mar-04
Jul-03
Oct-03
Jul-03
May-04
Country
Canada
Canada
Canada
Canada
USA
USA
USA
USA
USA
USA
USA
Operator
Bell Mobility
Picture Messaging
Rogers ATT Wireless
Microcell
Picture Messaging
Telus Mobility
T-Mobile USA
AT&T Wireless
Dobson CommunicatioPicture Messaging
Verizon Wireless
Cingular
Sprint
Picture Messaging
Edge Wireless
Picture Messaging
CDMA operators generally offer
propriety picture messaging service,
without interoperability with
standard based MMS.
Source: Nokia and public sources, May 2004
28
© NOKIA
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Oct-03
Jan-04
Jan-04
Apr-04
Jun-03
Jun-03
Jan-04
Dec-03
Nov-02
Jan-03
Sep-03
Nov-03
Mar-04
Mar-03
Jul-03
Jan-04
Jan-04
Jan-04
Jan-04
Jan-04
Feb-04
May-04
Aug-03
Nov-03
Apr-04
May-04
May-04
Jan-04
Sep-03
Jan-04
Jan-04
Jan-04
Jan-04
May-04
Jan-04
Nov.02
Jan-04
Argentina
Argentina
Argentina
Barbados
Bolivia
Bolivia
Bolivia
Brazil
Brazil
Brazil
Brazil
Cayman Islands
Cayman Islands
Chile
Chile
Chile
Colombia
Colombia
Colombia
Ecuador
Grenada
Honduras
Jamaica
Mexico
Mexico
Mexico
Nicaragua
Panama
Peru
Peru
Puerto Rico
Puerto Rico
St. Lucia
St. Lucia
Venezuela
Venezuela
Virgin Islands
Telecom Personal
CTI Movil
Movicom BellSouth
Digicel Barbados
Movil de Entel
Nuevatel
Cotas Movil
Claro
Oi
TIM
Brasilcel (Vivo)
Cable & Wireless
Digicel
Entel PCS
Telefonica Movil
BellSouth Chile
BellSouth Colombia
Colombia Movil
Comcel, Colombia
Porta, Ecuador
Cable & Wireless
Megatel
Digicel Jamaica
TelCel
Telefonica
Iusacell
Megatel (Enitel)
BellSouth Panama
TIM Peru
BellSouth Peru
Cingular de Puerto Rico
AWS Puerto Rico
Cable & Wireless St. Lucia
Digicel
Telcel BellSouth, Venezuela
Digitel
AWS Virgin Islands
In APAC MMS has spread in 20 countries
and 57 networks
Australia
Australia
Australia
Australia
Brunei
Cambodia
China
Fiji
Hong Kong
Hong Kong
Hong Kong
Hong Kong
Hong Kong
Hong Kong
India
India
India
India
India
India
India
India
Indonesia
Indonesia
Indonesia
Indonesia
Korea
Korea
Korea
Macau
Macau
Hutchison
Optus
Telstra
Vodafone
DSTcom (DataStream Technology
CaSaCom
China Mobile
Vodafone
Hong Kong CSL
Hutchison
New World
Peoples Telephone
SmarTone
Sunday
AirTel
RPG Cellular
Reliance
BPL Mobile
Idea Cellular
Bharti Cellular
Hutchison
Spice
Indosat
Telkomsel
Satelindo
Excelcomindo
KTF (Korea Telecom Freetel)
LG Telecom
SK Telecom
CTM
Hutchison
Already 57 operators provide MMS in
APAC and China in May 2004. MMS uptake
has been strongest in Australia,
Singapore, Malaysia and Indonesia.
CDMA operators generally offer propriety picture messaging service,
without interoperability with standard based MMS.
29
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Malaysia
Malaysia
Malaysia
Mauritius
New Zealand
New Zealand
Pakistan
Philippines
Philippines
Philippines
Singapore
Singapore
Singapore
Sri Lanka
Sri Lanka
Taiwan
Taiwan
Taiwan
Taiwan
Taiwan
Thailand
Thailand
Thailand
Vietnam
Vietnam
Maxis
DiGi
Celcom
Emtel
Telecom New Zealand
Vodafone
PTML
Globe Telecom
Smart Communications
Digitel
Mobile One
SingTel Mobile
StarHub
Mobitel
MTN Networks
TransAsia Telecommunica
Chunghwa Telecom
Taiwan Cellular Corp
Fareastone
Mobitai
AIS
TAC
TA Orange
Mobifone
Vinafone
China Mobile had 3.2 million MMS users end April
2004
• China Mobile's Multimedia Messaging Service growth has accelerated in
2004: End April 2004 China Mobile had 3.2 million MMS users (+50%
growth in one month from March 04).
• China Mobile now has around 100 MMS service providers, and over 2,500
content providers, with contents covering information, pictures, games,
chatting, advertisements, and location information.
• China Unicom is providing multimedia e-mail service using it´s own
proprietary standard. This is not interoperable with MMS.
Sources: Analysys, China Business Weekly March 9, 2004, SinoMR report, SinoCast LLC
30
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Guangdong,
Guangdong, Jiangsu,
Jiangsu, Zhejiang,
Zhejiang, Shanghai and Beijing are
leading the data usage in China
SMS Volumes by Province in Dec. (Bn Messages)
Guangdong
4.42
Jiangsu
2.62
Zhejiang
2.16
Guangdong
102
Shanghai
1.8
Fujian
Beijing
1.68
Zhejiang
1.25
160
Beijing
Shanghai
Shandong
88
78
57
52
Shandong
Liaoning
0.75
Jiangsu
Henan
0.73
Sichuan
Hubei
0.68
Hebei
33
Hunan
0.67
Heilongjiang
31
Total: 24.4billion
Top 10 share: 69%
Source: SinoMR, NMP China
31
Number of MMS Users by Province (k)
December 2003
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
46
42
Total: 1.0million
Top 10 share: 72%
The number of operators announced mobile Java services
between March and December 2003 (cumulative)
36 36
39
8
29
10 10
17
Americas
EMEA
Mar03 Oct03 Dec03
Source: Yankee Group, Gartner, Sun
Microsystems, Press releases
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
APAC & China
Mar03 Oct03 Dec03
Mar03 Oct03 Dec03
32
14
Java™ is the de-facto application development
environment in the mobile industry today
• 85 mobile operators worldwide have deployed Java™ services
(Nokia, December 2003)
• Mobile handset manufacturers with a combined market share of
over 80% support J2ME™
• Over 200 Java handset models from 27 vendors on the market
(Sun, October 2003)
• Over 120 million Java™ handsets on market already by October
2003 (Sun, October 2003)
• Over 1 million mobile Java™ developer toolkits have been
downloaded from forum.nokia.com
Sources: Sun Microsystems, Gartner, ARC Group; Yankee Group; Nokia
33
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Java™ has a firm foothold in mobile services globally
=
Est ~10 million mobile Java™ downloads globally / month *
Telefonica Moviles Spain TME sold
3M java applications during 2003
iTouch reports 160,000 wireless
Java games downloaded in Spain
mm02 reports 500.000 Java
game users
January 2004
October 2003
December2003
Eurotel Praha is close to 100,000
Java game downloads / month,
with monthly growth rate of 15%
Jamba reports over 600,000 Java
downloads / month, up 1500%
from a year ago
January 2004
December 2003
Vodafone Live ! reports 3.000.000
Java game downloads between
launch and July 03
Source: public sources
34
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
*) Nokia estimate
Case of fast uptake of Java download
• Vodafone D2 Germany is surprised about the fast increase in Java games
download.
• Market grew more than 100% in 2003.
•
•
•
good quality of J2ME games
decreasing prices of high-end phones
increasing quality of screens
• Most of the content is local
•
100 out of 130 partners are German
Source Mobile Media 19.12.2003
35
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
40 operators around the world launched mobile video
services since 2001 (cumulative)
20
16
11
10
3
4
Americas
Mar03 Dec03
EMEA
Mar03 Dec03
Source: Public sources, January 2004
36
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
APAC & China
Mar03 Dec03
Over 40 operators around the world launched mobile
video services, by end-03
Examples of announced
video deployments or trials
Europe and Africa
Europe and Africa
1.
Hutchison Telecoms – streaming, DL
1.
Hutchison Telecoms – streaming, DL
2.
O2 - mobile video service, launched October 2003
2.
O2 - mobile video service, launched October 2003
3.
Polska Telefonia Cyfrowa (PTC) – video (May 2003)
3.
Polska Telefonia Cyfrowa (PTC) – video (May 2003)
4.
Orange – streaming (Oct 2002)
4.
Orange – streaming (Oct 2002)
5.
Vodafone
5.
Vodafone
Germany - Streaming (Jul 2003)
6.
6.
7.
7.
8.
8.
9.
9.
10.
10.
11.
11.
12.
12.
13.
13.
14.
14.
15.
15.
16.
16.
17.
17.
18.
18.
19.
19.
37
Germany - Streaming (Jul 2003)
T-Mobile
T-Mobile
Germany
Germany
Austria
Austria
Telefonica Moviles – Java download of video content (May
Telefonica
Moviles – Java download of video content (May
2003)
2003)
SoneraSonera-Telia
SoneraSonera-Telia
Wind Italy – DL (Jul 2002), MMS (Dec 2002)
Wind Italy – DL (Jul 2002), MMS (Dec 2002)
MTCMTC-Vodafone Bahrain – Streaming, MMS, vidtel (Dec
MTCMTC-Vodafone Bahrain – Streaming, MMS, vidtel (Dec
2003)
2003)
3 Italy ((October
October 27, 2003)
2003)
3 Italy ((October
October 27, 2003)
2003)
Orange UK
Orange UK
MTN South Africa – Video MMS
MTN South Africa – Video MMS
Telecom Italia Mobile (TIM)
Telecom Italia Mobile (TIM)
STET Hellas (Jan, 2004)
STET Hellas (Jan, 2004)
3 Sweden (29 Oct 2003) (streamed
(streamed video news)
3 Sweden (29 Oct 2003) (streamed
(streamed video news)
3 Denmark (29 Oct 2003) (streamed
streamed video news)
3 Denmark (29 Oct 2003) (streamed
streamed video news)
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Asia and Pacific
Asia and Pacific
1.
CSL Hong Kong – video MMS (?)
1.
CSL Hong Kong – video MMS (?)
2.
J-Phone – video MMS (Mar 2002)
2.
J-Phone – video MMS (Mar 2002)
3.
LG TeleCom – streaming (December 2001)
3.
LG TeleCom – streaming (December 2001)
4.
NTT DoCoMo – DL & streaming (May 2003)
4.
NTT DoCoMo – DL & streaming (May 2003)
5.
M1 – streaming (June 2003), video DL (March
5.
M1 – streaming (June 2003), video DL (March
2003)
2003)
6.
Hutchison Australia (Apr 2003) – live video
6.
Hutchison Australia (Apr 2003) – live video
messaging
messaging
7.
Far Eastone Taiwan – video MMS (Jul 2003)
7.
Far Eastone Taiwan – video MMS (Jul 2003)
8.
KDDI Japan
8.
KDDI Japan
9.
SmarTone – video MMS (Jan 2003)
9.
SmarTone – video MMS (Jan 2003)
10.
AIS – video streaming over GPRS (2003)
10.
AIS – video streaming over GPRS (2003)
11.
DTAC – download of video clips (June 2003)
11.
DTAC – download of video clips (June 2003)
12.
Maxis Communications Bhd,
Bhd, video MMS
12.
Maxis Communications Bhd,
Bhd, video MMS
13.
SingTel Singapore – Video MMS & Download
13. (Apr
SingTel
2003)Singapore – Video MMS & Download
(Apr 2003)
14.
SK Telecom
14.
SK Telecom
15.
3 Hong Kong
15.
3 Hong Kong
16.
Optus Australia, streaming
16.
Optus Australia, streaming
Americas
Americas
1.
AT&T Wireless – streaming (Dec 2001)
1.
AT&T Wireless – streaming (Dec 2001)
2.
Sprint PCS – streaming (Apr 2003)
2.
Sprint PCS – streaming (Apr 2003)
3.
T-Mobile USA – video MMS (March 2003)
3.
T-Mobile USA – video MMS (March 2003)
4.
Vivo Brazil – download (September 2003)
4.
Vivo Brazil – download (September 2003)
Example: TV programs as video streaming
Vodafone has struck a deal with BBC to exclusively deliver classic TV comedy clips
over mobiles. Eight 30-second clips from Fawlty Towers will be offered initially,
with other shows expected to follow shortly.
Main Source: www.bbc.co.uk
MTV videos are now available on mobile. Mobile operator 3 customers can access unique MTV
mobile video packages - music news, live performance footage, and music videos. Also
available will be MTV's original programming including clips from Jackass and Dirty Sanchez packaged for video mobiles. MTV will provide unique, localised content including live
performance footage by artists such as Radiohead and Bjork.
38
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
End user bit rates with
different radio access
technologies
39
© NOKIA
Presentation_Name.PPT / DD-MM-YYYY / Initials
Bit Rate Benchmarking
•
•
•
•
• GPRS
• cdma2000-1x
• EDGE
250
200
150
kbps
100
40
2500
Theory
Peak
Average
2000
1500
kbps
1000
50
500
0
0
© NOKIA
cdma2000-1x
EDGE
cdma2000-1x EVDO
WCDMA/HSDPA
GPRS
cdma2k-1x
Presentation_Name.PPT / DD-MM-YYYY / Initials
EDGE
Theory
Peak
Average
cdma2k-1x
EDGE
EV-DO
WCDMA
HSDPA
Openness
Openness
Contents
Executive Summary
Introduction
Speed of Innovation
Openness in Mobile Telecoms
Revenues from Roaming Calls
Messaging
Need for Openness in the Future
Benefits of Open Standards
Summary
Industry Efforts for Openness
2
2
3
4
5
6
6
8
9
10
Authors
Nokia Networks, Strategic Marketing
Further information
Nokia Networks, Strategic Marketing
Tel.+44 (0)1252 866000
It should be noted that certain statements herein which are not historical facts, including, without limitation those regarding A) the timing of product deliveries;
B) our ability to develop and implement new products and technologies; C) expectations regarding market growth and developments; D) expectations for
growth and profitability; and E) statements preceded by “believe,” “expect,” “anticipate,” “foresee” or similar expressions, are forward-looking statements.
Because these statements involve risks and uncertainties, actual results may differ materially from the results that we currently expect. Factors that could
cause these differences include, but are not limited to: 1) developments in the mobile communications market including the continued development of the
replacement market and the Company’s success in the 3G market; 2) demand for products and services; 3) market acceptance of new products and service
introductions; 4) the availability of new products and services by operators; 5) weakened economic conditions in many of the Company’s principal markets; 6)
pricing pressures; 7) intensity of competition; 8) the impact of changes in technology; 9) consolidation or other structural changes in the mobile communications
market; 10) the success and financial condition of the Company’s partners, suppliers and customers; 11) the management of the Company’s customer financing
exposure; 12) the continued success of product development by the Company; 13) the continued success of cost-efficient, effective and flexible manufacturing
by the Company; 14) the ability of the Company to source component production and R&D without interruption and at acceptable prices; 15) inventory
1 of 12
management risks resulting from shifts in market demand; 16) fluctuations in exchange rates, including, in particular, the fluctuations in the euro exchange rate
between the US dollar and the Japanese yen; 17) impact of changes in government policies, laws or regulations; 18) the risk factors specified on pages 10 to 17 of
© Nokia Networks May 2003
the Company’s Form 20-F for the year ended December 31, 2001.
Openness
Executive Summary
The debate between proponents of proprietary systems and those supporting open
systems has raged over countless technological innovations. The lessons from history
prove that open systems generate compelling business benefits over the long run. This
White Paper places openness into its context within mobile telecoms.
Open standards with mobile telecoms have, for instance, helped to develop greater
revenue streams through roaming calls as well as increased traffic with interoperability
of SMS text messaging. The industry recognises the lessons from these early successes
and is adopting openness for further success with multimedia messaging and more
advanced 3G type services.
All parties involved in mobile telecoms derive benefits from openness. Consumers benefit
from a wider selection of terminals, a broader selection of services, and lower costs.
Network operators benefit from faster deployment of new services and lower costs.
Equipment vendors benefit from greater scale and therefore from lower costs. Application
developers, suppliers and subcontractors benefit from greater accessible markets
and scale.
Introduction
Technical innovation has often seen the battles of proprietary standards versus more open
standards. The video cassette recorder wars had VHS competing against Betamax. The
dominant VHS standard eventually tipped the balance in its favour as video rental stores
stocked more movies on the more popular format. Laws of greater accessible markets will
always determine the eventual winner.
The emergence of the fixed Internet pitted against each other the closed groups of “BBS”
Bulletin Board Systems and the open Internet. Similarly in the Internet domain a centrally
controlled rigid standard known as Gopher that controlled how data was stored, met with
the HTML based open standards of the World Wide Web. BBS became a relic of computer
networking as did Gopher. Open standards prevailed in a remarkably rapid fashion and
were the basis for the spectacular growth of the Internet.
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© Nokia Networks May 2003
Openness
Some engineers like to point out that at any given point a system typically built to a
proprietary standard can initially deliver greater technical performance than one built
upon a rival open standard – interestingly, an argument that was passionately proposed
in support of both Betamax and Gopher. This argument looks only at the short-term and
neglects the greater commercial benefits and success of open systems. Any short-term
technical gains that a proprietary standard might achieve can soon be copied into the
open standard. But the benefits of larger scale and its overwhelming market economics
cannot be copied by proprietary standards. Any technical advantage would be a short
term illusion while the greater commercial gain would be permanent and ultimately
overwhelming.
Technology Price Evolution
Open vs. Proprietary
100
Time from Launch
Index %
80
60
40
20
Technolgy 1 (open)
Technolgy 2 (proprietary)
0
Technolgy 3 (proprietary)
Figure 1.
Technology price evolution; Open vs. proprietary
(“Experience shows that proprietary technology will result
in higher prices & less supply”, Michael Porter 1996.)
The effects of open and proprietary systems have been studied and the findings have
been consistent in showing that open systems deliver lower prices and greater numbers
of suppliers. This was illustrated very dramatically by Michael Porter in 1996 (Figure 1)
when comparing three competing technologies. The open standard yielded the lowest
price and largest amount of supply.
Speed of Innovation
Proprietary standards tend to allow faster adoption of changes, especially over the short
term. This is mostly related to the control imposed upon the standard by its proprietary
owner. With open standards it takes longer to achieve consensus on how to develop
the system, however this approach tends to have greater latitude of change enabling
evolution over longer periods of time and over the long term actually produces greater
positive transformation. (Table 1).
Whereas the whole system may evolve less rapidly, individual components on an open
system tend to develop much faster than those on proprietary standards. This is due to the
effects of competition. It is a fundamental feature of openness that smaller participants can
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© Nokia Networks May 2003
Openness
enter the value system with low costs of entry. With more participants joining to develop
components to the open system, more innovation is involved. This in turn helps
the whole industry cycle of evolution to more advanced solutions.
Anticipated needs
Speed of change
Extent of change
Evolution of ecosystem
Intellectual property
Business model
Participants
Competitiveness
Use
Proprietary standard
known
fast
narrow
slow
standard owner
stable
few
short term
purpose-built
Open standard
emerging
slow
broad
fast
innovator
evolving
many
long term
general purpose
Table 1.
Proprietary vs. Openness
Openness in Mobile Telecoms
In the mobile telecoms world the very first analogue systems were national standards
that were incompatible with each other. A significant innovation was the NMT (Nordic
Mobile Telecom) standard, which was the first international standard for mobile telecoms.
In each of the Nordic countries, the local manufacturers of Ericsson and Nokia, as well
as the local mobile operators of Telia of Sweden, Telenor of Norway, Tele Danmark and
Sonera (then Telecom Finland) were able to gain considerable benefits of scale even though
individually each of the four countries had small domestic populations.
1
2
(source: EMC, Dec 2002)
(source: GSM Association)
When second generation (2G) mobile systems were being standardised, the GSM (Global
System for Mobile communications) standard took the lessons from NMT and adopted
philosophies of open standards. Although GSM’s market potential was initially similar to
the other digital 2G standards, TDMA (Time Division Multiple Access), CDMA (Code Division
Multiple Access) and PDC (Pacific Digital Cellular), GSM grew much more rapidly and
has become the undisputed leading digital standard. In fact during 2002, GSM numbers
swelled by 165 million subscribers which is more than the total existing subscriber base of
any of the other three digital standards1. Today GSM dwarfs its rival 2G standards with over
825 million subscribers on 474 GSM mobile networks in 172 countries2.
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© Nokia Networks May 2003
Openness
Revenues from Roaming Calls
Due to its legacy with NMT, international roaming was made a fundamental aspect of
GSM. Consequently in all GSM markets the local mobile operator gains extra revenues from
foreigners who place roaming calls. GSM operators discovered early that roaming calls were
very lucrative, delivering disproportionately
high revenues. Pyramid Research has
calculated that Western European operators
typically earn 7% of their total revenues
from roaming customers visiting their
networks.
In GSM countries heavily dependent on
tourism, such as Croatia, Tahiti and Cyprus,
the effect of tourist traffic is much more
dramatic. A good example is Cyprus.
The island population is about 690,000
but during the peak tourist season the
population swells to 2.5 million. As the European mobile phone penetration on the whole
is about 80%, practically all travellers to Cyprus tend to bring their GSM phones with them.
The number of users, the amount of traffic, and very importantly the increased amount
of revenues per user are all multiplied during the peak summer season, according to
the Cypriot Communications Ministry.
UK SMS Market
1999-2000
Number of SMS messages - Millions
600
500
400
300
SMS business without IOP,
interconnection and roaming
200
100
0
Jan '99
Apr '99
Jul '99
Oct '99
Jan '00
Apr '00
Jul '00
Source: MDA, Sep 200
Figure 2.
SMS market in the UK 1999-2000
after interconnect
As the world’s mobile phone population is well in excess of 1.1 billion and about 70% of
the users are using the GSM standards, any mobile operator, which uses a TDMA, CDMA
or PDC digital standard, abandons significant additional revenues from tourists and
travelling businessmen. The GSM Association has calculated that 650 million people travel
to other countries every year wishing to use their mobile phones. During 2002 there
were over 900 million roaming phone calls made each month on GSM networks with
the number continually growing.
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© Nokia Networks May 2003
Openness
Messaging
In the early 1990s the philosophy of openness inherent in GSM helped bring about SMS
interoperability between early SMS adopting operators. This in turn facilitated the market
success of the first mobile data service, SMS text messaging, enabling a new dimension to
the market economics
of mobile telecoms.
Countries with only
GSM networks soon
experienced
a
dramatic boost to text
message
use.
In
countries with mixed
systems it took much
longer to engage in
the technical work
and
commercial
agreements needed
for SMS interconnect.
The USA market was
among the very last
to adopt SMS interconnect between all mobile operators during April 2002, but even
there, as everywhere else before, the immediate effect was a dramatic jump in the total
use of SMS text messages.
The effect of interconnect in messaging is immediate and dramatic. Nokia 3G Business
Consultancy isolated the inflection point for the surge in messaging as the combined
effects of SMS interoperability within a country, and a subscription penetration of 28-30%.
The pattern of a solid surge in traffic was clearly established for example in the UK
during 1999-2000. Yankee Group has since calculated that the actual jump in SMS text
message use is typically 40% but can be even higher such as in the USA where the
Wireless Services Corporation reports over 100% increase in SMS text messages after
the adoption of SMS interoperability.
With Multimedia Messaging (MMS) the needs of open standards and MMS interoperability
are even more critical. The complexity of MMS is much greater than that of SMS and
requires more work to ensure end-to-end delivery of multimedia messages as they were
intended. The rewards can be considerable as Jupiter Research has estimated that MMS
could generate global revenues of $8.3 billion by 2004, with the prerequisite that MMS
interconnection is enabled between networks. The end-users can build upon their recently
learned behaviour of sending text messages from holiday and business trips. As the
camera-phones start to replace holiday snapshot cameras, the ability to send picture
messages will provide compelling benefits to users. Similar to the patterns on SMS, MMS
is likely to see a dramatic uptake after a certain level of MMS enable phone penetration
is achieved.
Need for Openness in the Future
The mobile telecoms industry is facing several simultaneous upheavals causing potential
disruption. The introduction of simple SMS text messaging in the 1990s is now giving way
to the advent of advanced mobile data services. Theorists a few years ago projected that
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© Nokia Networks May 2003
Openness
the diminishing revenues from voice minutes will eventually be offset by new revenues
from mobile data. That trend is now being witnessed by the early adopting countries. The
ten leading mobile operators with high proportions of revenues from data services each
report over 15% of total revenues coming from data. The global leaders, Smart and Globe
in the Philippines are approaching 40% of mobile data revenues. The fascinating fact
is that eight of the top ten high data revenue operators are GSM operators, with the
remaining two in Japan using PDC technology. Figure 3.
Data as a percentage of ARPU
40
Percentage
30
20
10
0
Globe
Smart
NTT DoCoMo
J-Phone
RadioMobil
Czech
02
Germany
O2
UK
O2
Netherlands
Amena
Spain
Source: EMC World Cellular Data Metrics
Figure 3.
Data as percentage of ARPU
The mobile telecoms industry is also seeing the digital convergence of content and
delivery, with many industries now converging. Early examples include games; news
updates; music in the form of ringing tones, all of which are delivering
significant revenues for the mobile telecoms industry as well
as the adjacent industries. SMS-to-TV for example is delivering
significant new revenue streams to the television industry.
As the digital convergence takes place, again openness is
the key to attracting new participants who share in the
technology, benefits and revenues.
The mobile telecoms industry is also engaged in the
upgrade of the technical delivery platform from
second to third generation. 3G standards were
defined first in IMT-2000 (International Mobile
Telecommunications for 2000) and the primary
3G standards that emerged are the evolution path
of GPRS (General Packet Radio System) to EDGE
(Enhanced Data for GSM Evolution) and WCDMA
(Wideband Code Division Multiple Access)
and the evolution path of CDMA2000 1X to
CDMA2000 EV-DO and CDMA2000 EV-DV. The
primary evolution paths for the existing 2G
systems are summarised in the figure 4.
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© Nokia Networks May 2003
Openness
Global Evolution of Mobile Technologies
TDMA
GSM/GPRS/EDGE
GSM/GPRS
All IP
WCDMA
PDC
Open interface
multi-radio
network
HSDPA
3GPP
cdma2000 1xEV-DV
cdmaOne
cdma2000 1x
cdma2000 1xEV-DO
3GPP2
2G
First Steps to 3G
3G Phase 1 Networks Evolved 3G Networks
Figure 4.
Evolution to 3G
Benefits of Open Standards
The benefits from openness affect all interested parties involved in mobile telecoms.
The consumer, subscriber or end-user benefits from openness in many ways. The initial
decision for most consumers is the selection of the mobile phone or handset. Open
standards allow more handset manufacturers to enter into the market, which means
more choice in mobile phone handsets, modems and other terminals. Consumers also
benefit from open standards in how systems can interact with each other - significant
with travelling for example. Consumers also gain from a wider selection of services, and
reduced costs of phones and the associated mobile services.
As the gate keepers to the whole mobile telecoms technology and opportunity, mobile
operators (wireless carriers) have the ability to affect every part of the value chain and
to select which parts they want to participate in. Open standards allow interchangeable
components used in the network, further reducing costs. In addition, open standards
permit faster deployment of new services increasing revenues and providing competitive
advantages and opportunities to differentiate. Mobile operators also benefit from open
standards through easier integration of services, network components and user equipment
onto new networks. Easier integration and implementation reduce costs for operators. All
of these relate to better customer satisfaction and better business management.
The application developers, content providers, as well as the various suppliers and
subcontractors serving mobile operators, application developers and equipment vendors
will find greater accessible markets through open standards. What previously might have
been a market where the global opportunity was that of one equipment vendor now
becomes a market with dozens of major customers. The suppliers and subcontractors
can find economies of scale that bring down costs. These savings in turn help the
industry overall achieve gains in cost-benefits. As can be seen, the whole ecosystem
gains through openness.
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© Nokia Networks May 2003
Openness
Equipment vendors may find conflicting interests between open systems and proprietary
ones. A proprietary system can be used to lock in a customer and can help bring rapid
changes and customisation. However, over the longer term an open system will invariably
deliver more competition, more innovation, lower cost and better performance than
any short term gains of a proprietary system. That is why equipment vendors should
embrace openness and seek to utilise their own competitive advantages within an
open system, rather than fight the trend and force customers into proprietary based,
locked in solutions.
Summary
A proprietary system may yield short-term benefits and may provide temptation to be
adopted for given immediate technical interests. However, the overwhelming business
benefits of openness, in reducing barriers to entry, increasing addressable market size,
expanding offerings and promoting innovation through competition produce long term
benefits that far outweigh any short term gains. Overall openness yields costs savings
all throughout the value systems from voice or content creation to delivery right to the
end-user. With mobile telecoms open systems are beneficial to the end-users, mobile
operators, equipment vendors, application developers, content providers and the various
subcontractors all involved in developing a more advanced mobile telecommunications
system. The GSM evolution path through GPRS, EDGE and WCDMA and the leading open
standards bodies promote the expansion of the total business opportunity for all involved
and creates a sustainable business case that has been proven time and time again.
The various open standards bodies and Nokia warmly welcome any new participants to
contribute and join the largest global mobile ecosystem.
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© Nokia Networks May 2003
Openness
Industry Efforts for Openness
Third Generation Partnership Project (3GPP)
The original spectrum allocations for 3G systems were set by the WRC (World Radio
Congress). The family of standards was defined in the IMT-2000, after which the 3GPP
(Third Generation Partnership Project) has been the primary standardisation body for
harmonising the various network technical standards. The GMS path of 3G evolution was
given the name UMTS (Universal Mobile Telecommunication System) to reflect the fact that
it was selected by the vast majority of existing network operators as well as being the only
standard present in all major markets of the world. The WRC and IMT-2000 were mainly
involved with ensuring common frequencies for 3G globally.
3GPP is a collaboration agreement, which brings together standards bodies for developing
the standards for WCDMA as well as GSM/EDGE technologies. The group started developing
the WCDMA standards in early 1999, and the 3GPP Release 1999 standard is the first release
introducing the WCDMA air interface and radio access network. GSM/EDGE standards have
been developed as part of the project since 2001. (www.3gpp.org)
Linux / Open Source Development Lab
Linux is an open standards based operating system for computers. It is increasingly
being used in telecoms applications and it has an Open Source Development Lab, a
non-profit organisation, which guides the development of Linux for enterprise and
carrier-grade uses. Its Carrier Grade Working Group is focused on telecoms operator
needs. (www.osdl.org).
Nokia joined the Open Source Development Lab’s Carrier Grade Working Group in 2002.
Symbian
The idea of an open standard for mobile phone handsets is a relatively new one. A modern
mobile phone handset in 2.5G and 3G is incredibly sophisticated in its technology where
the radio components tend to be most demanding and challenging. Modern handsets need
to be a finely tuned balance of size, weight, battery life, colour display, memory storage,
as well as increasingly multi-radio transceivers. The integration of cameras, radios,
music players, game players, input devices, etc. adds to the complexity of higher end
mobile phone handsets. Open standards are vital enablers of achieving such complex,
advanced and integrated devices.
The biggest factor in allowing openness in terminals is an operating system based on
open standards. Symbian was established for that purpose in 1998 and Symbian is jointly
owned by the major handset manufacturers, Ericsson, Motorola, Nokia, Panasonic, Psion,
Siemens and Sony. Symbian aims to drive the convergence of mobile computing and
wireless technology by promoting user interfaces, applications, frameworks, application
and development tools, as well as standards for interoperation of wireless terminals
with networks, content services, messaging and solutions. (www.symbian.com). Nokia
is a founding member of Symbian.
Open Mobile Alliance (OMA)
Mobile services are the newest of the technical developments and experiencing the
greatest change currently. With an explosion of new mobile services including mobile
10 of 12
© Nokia Networks May 2003
Openness
commerce, entertainment, information, communication services as well as various data
access applications, this area is likely to see dramatic innovation and completely new
service concepts. The needs of service and application developers bring about their
own desires of open standards.
The leading global body involved in services related open standards is the Open Mobile
Alliance, OMA, which emerged to harmonise the work of numerous separate bodies
involved with services and applications. OMA’s focus is on improving the end user
experience. OMA promotes open global standards where the service applications layer is
bearer agnostic and independent of the operating system while services and applications
are interoperable with seamless roaming. Numerous bodies including Wireless Village,
Location Interoperability Forum, SyncML Initiative, Multimedia Services Interoperability
Group, Mobile Gaming Interoperability Forum and Mobile Wireless Internet Forum
have been integrated into OMA. (www.openmobilealliance.org). Nokia is a founding
member of OMA.
End-to-end interoperability across value chain
and specification forms
Browsing
MMS
Across enabling
technologies
Presence
Location
Wireless
Village
LIF
Apps and
Servers
Content &
Media
Across services
and products
IT
Content &
Media
Across companies
of end-to-end
value chain
OMA
Examples of
end-user
service
scenarios
SyncML
MMS-IOP
OMA
Messaging/
imaging
Mobile
workplace
Terminals
Networks
Integration to
OMA across
standards and
specification
forums
OMA
Mobile
infotainment
Operators
Wireless
Vendors
OMA
Source: Open Mobile Alliance
Figure 5.
OMA interoperability
Mobile Electronic Transactions (MeT)
Mobile Electronic Transactions is a company founded to establish a framework for secure
mobile transactions, ensuring a consistent user experience with mobile commerce
independent of device, service, and network. The MeT is sponsored by Nokia, Ericsson, NEC,
Panasonic, Siemens, and SonyEricsson. MeT is addressing the needs of application areas
such as identification, authorisation, credit and debit card payments, loyalty schemes,
and ticketing. (www.mobiletransaction.org).
Web Services Interoperability organisation (WS-I)
Web Services Interoperability organisation (WS-I), is an open, industry organisation
chartered to promote Web services interoperability across platforms, operating systems,
11 of 12
© Nokia Networks May 2003
Openness
and programming languages. Nokia supports mobile Web services as a key technology
in linking systems and enhancing business opportunities between operators and content
providers. (www.ws-i.org)
Java Community Process (JCP)
Java™ technology includes both a programming language and application execution
environment. The technology allows third parties to create new and exciting applications
for Java enabled mobile phones and other devices. The specification and development
work of Java is now carried out by an open industry organisation called the Java
Community Process (JCP). (www.jcp.org). Nokia is actively involved with JCP.
OSS through Java™ Initiative
The OSS (Operational Support Systems) through Java™ initiative develops application
programming interfaces for OSS solutions where all applications function together.
This helps service providers to jumpstart the deployment of end-to-end services on
next-generation wireless networks and to leverage the convergence of telecommunications
and Internet-based solutions. (http://java.sun.com/products/oss/). Nokia is a founding
member of OSS through Java Initiative.
Nokia Efforts for Openness
Series 60
Beyond the operating system, Nokia has also pursued openness in the licensing of the
terminal software. The Nokia Series 60 Platform is a source-code product that terminal
manufacturers can integrate into their own smartphone hardware designs. To develop
a large applications market, Nokia is fostering an open development community, with
licensees, around the Series 60 Platform. This open development provides licensees
with full access to the application source, to contribute in the product’s development,
and the freedom to choose the direction of their own Series 60 Platform development.
(http://www.nokia.com/cda1/0,,2816,00.html)
Forum Nokia
Nokia’s global developer programme, Forum Nokia, connects developers to the tools,
technical information, support, and distribution channels they need to build and market
applications around the world. Forum Nokia provides hundreds of technical documents,
developer communities, application testing, etc. (www.forum.nokia.com)
12 of 12
© Nokia Networks May 2003
White Paper
Nokia High Speed
Packet Access Solution
White Paper
Contents
Executive summary
2
High Speed Packet Access, major evolutionary step
HSDPA improvements
HSUPA Improvements
3
3
5
Nokia High Speed Packet Access implementation
6
Key benefits of Nokia High Speed Packet Access evolution
HSDPA and HSUPA will optimize the network to enable lower
production cost per bit
HSDPA and HSUPA will improve the perceived value of user services
7
Glossary
7
7
7
Executive summary
The volume of IP (Internet Protocol)
traffic has already exceeded that for
circuit-switched traffic in most fixed
networks. The same change will happen
in mobile networks as new IP-based
mobile services, such as video news
bulletins, downloading music or
checking bus arrivals, become available
and are used by more people in their
daily communications.
Delivery of digital content over mobile
networks, as well as IP-based person-toperson communication that combines
different media and services into a single
session, will generate additional traffic
and revenue. The volume of data bits
used in communications will grow faster
than revenue, driving operators to
optimize their networks to support the
dominant traffic type. While downlink
optimization is enough for content-toperson services, real interactive and
person-to-person IP-based services
require uplink optimization as well.
Two key technologies, HSDPA (High Speed
Downlink Packet Access) and HSUPA
(High Speed Uplink Packet Access), offer
breakthrough data speeds – theoretically
up to 14.4 Mbps in downlink and up to
5.8 Mbps in uplink respectively –
2
clearly higher than the most advanced
3G networks.
For users this means shorter service
response times and less delay.
Meanwhile, operators will be able to
offer advanced services at lower costs
and with increased profitability. As the
Nokia HSDPA Solution is fully backwards
compatible with current Nokia WCDMA
networks, it is a cost-effective way to
upgrade existing infrastructure.
By providing higher quality and capacity
it will help to drive up the consumption
of data-intensive services, bringing
operators more revenue in mobile
communication. HSDPA and HSUPA
technologies offer by far the highest
performance at the lowest cost, enabling
real mass-market mobile IP multimedia.
WCDMA downlink evolution, HSDPA,
is part of 3GPP/UTRAN-FDD Release 5
WCDMA specifications. The new
modulation method greatly improves the
peak data rate and throughput, which
enhances spectral efficiency. In addition
to these benefits, users will perceive
faster connections to services through
shorter round trip times. As a result of
these enhancements, operators using
HSDPA will be able to support considerably
higher numbers of high data rate users
on a single radio carrier than is possible
with any existing 3G technology. Moving
scheduling from RNC to BTS also improves
the efficency of the Iub (connection
between Radio Network Controller and
Base Station). The improvement is
50–70% for typical web browsing with
128–384 kbps user data rates.
Standardized WCDMA uplink evolution,
HSUPA, is ongoing in 3GPP completion
planned for the end of 2004. The target
is to improve usability of higher bit
rates in the uplink, resulting in greater
capacity, higher peak rates and lower
end-user delay.
HSDPA will be introduced into operator
networks in stages. The first
implementations will address business
connectivity. The leading operators are
expected to start commercial HSDPA
trials in 2005. The second phase will be
the introduction of HSDPA to all user
segments in a multi-service environment
with a wider terminal product range.
This solution is expected to be on the
market in 2006. HSUPA introduction is
then likely to be a further stage after the
HSDPA market has been established.
White Paper
High Speed Packet Access, major evolutionary step
The WCDMA air interface has been
standardized by the 3rd Generation
Partnership Project (3GPP) as a radio
transport medium for global mobile
communications. Consequently, the first
versions of the 3GPP air interface
specifications enabled superior user data
rates and system throughput capacities
compared to any 2nd generation mobile
communication standard.
The channel types specified in Release 99
can carry IP traffic and can be used for
delay sensitive applications as VoIP.
With HSDPA and HSUPA, users will
experience better Internet and intranet
access with laptops, large file downloads
and high quality streaming applications.
HSDPA
Adaptive
modulation and
coding
Fast
retransmissions
with incremental
redundancy
Figure 1. HSDPA.
Adaptive Modulation and Coding
The WCDMA system’s adaptability enables
a new and significant evolutionary step
in packet data access. The Nokia High
Speed Packet Access Solution comprises
two key evolutionary steps: HSDPA and
HSUPA.
HSDPA and HSUPA improve system
capacity and increase user data rates.
HSDPA improves the downlink direction,
that is transmission from the radio access
network to the mobile terminal. HSUPA
improves the uplink for transmitting
data from mobile terminals to the radio
access network.
HSDPA can provide cell throughput gains
of up to two to three-fold compared to
normal Release 99 WCDMA. With HSUPA,
the cell throughput is expected to be
20–50% greater than in Release 99 WCDMA.
HSDPA improvements
Improved performance of the HSDPA is
based on:
1) Adaptive modulation and coding
2) A fast scheduling function, which is
controlled in the base station (BTS),
rather than by the radio network
controller (RNC).
3) Fast retransmissions with soft
combining and incremental
redundancy
Fast
scheduling
in BTS
Adaptive modulation and coding (AMC)
in HSDPA is the ability to select a coding
rate between 1/4 and 4/4 and a
modulation method between 16QAM
and QPSK. Of these two standardized
methods, the former provides higher
data rates. The link adaptation is based
on fast channel quality feedback
received from the mobile. The HSDPA
specification supports the use of 5, 10 or
15 multicodes. The multicodes together
with time multiplexing can be used to
increase the number of users.
Link adaptation ensures the highest
possible data rate is achieved both for
users with good signal quality (higher
coding rate), typically close to the base
station, and for more distant users at
the cell edge (lower coding rate). In the
future, advanced mobile terminal
features such as dual antenna reception
and equalized receivers can be used
directly because new mobiles will
simply report better channel conditions
and the BTS will allocate higher data
rates to those mobiles.
power/code availability. These
parameters are taken into account in
the packet scheduler algorithm.
Scheduling is fast because it is performed
as close to the air interface as possible,
using the physical layer feedback
information on the channel quality and
because a short frame length is used.
Fast retransmissions
Should link errors occur, caused for
example by interference, the mobile
terminal rapidly requests physical layer
retransmission of the data packets.
In current WCDMA networks, these
requests are processed by the RNC.
In HSDPA, the request is processed in
the base station providing the fastest
possible response. This mechanism is
called hybrid ARQ, or HARQ.
The retransmission can be received in
10 ms with HSDPA. In addition to fast
retransmissions, incremental
redundancy can also be used. This
technique selects correctly transmitted
bits from the original transmission and
retransmission to minimize the need for
further repeat requests when multiple
errors occur in transmitted signals.
Fast scheduling
Scheduling of the transmission of data
packets over the air interface is moved
from the RNC to the BTS. The packet
scheduling in the BTS is based on
information on the channel quality,
terminal capability, and QoS class and
3
White Paper
Time Multiplexed Channel for
efficient radio resource utilisation
The WCDMA system normally carries
user data over dedicated transport
channels, DCHs, which are code
multiplexed onto one RF carrier. In the
future, user applications are likely to
involve the transport of large volumes of
data that will be bursty in nature and
require high peak bit rates.
DCH1
HSDPA introduces a new transport
channel type, High Speed Downlink
Shared Channel (HS-DSCH) that makes
efficient use of valuable radio frequency
resources and takes into account bursty
packet data.
Multiplexed
HS-DSCH
This new transport channel shares
multiple access codes, transmission
power and use of infrastructure
hardware between several users.
The radio network resources can be used
efficiently to serve a large number of
users accessing bursty data. To illustrate
this, when one user has sent a data
packet over the network, another user
then gains access to the resources and
so forth. In other words, several users
can be time multiplexed so that during
silent periods, the resources are available
to other users. This improves not only
air interface resource usage, but also
improves Iub efficency.
Figure 2 shows a simplified explanation
of the principle of sharing a common
transport channel. New signalling
channels are needed in downlink and
uplink. In the downlink the HS-SCCH
(High Speed Shared Control Channel)
facilitates signalling related to HS-DSCH
reception while in the uplink direction,
the channel quality feedback and
feedback on the packet decoding errors
are carried on the HS-DPCCH (High Speed
Dedicated Physical Control Channel).
HSDPA Performance
HSDPA offers maximum peak rates of up
to 14.4 Mbps (with 15 spreading codes
and with no channel coding) in a 5 MHz
channel. However, more important
than the peak rate is the packet data
throughput capacity, which is improved
significantly. This increases the number
of users that can be supported at higher
data rates on a single radio carrier.
4
DCH2
DCH3
Figure 2. Channel sharing.
Kbps per cell
6000
WCDMA Release 99
5000
HSDPA simple scheduler
HSDPA advanced scheduler
4000
HSDPA advanced mobiles
3000
2000
1000
0
Macro cell
Small cell
Figure 3. HSDPA capacity increase with two different fast packet scheduling algorithms and with advanced mobile terminals.
Performance with two different fast
scheduling algorithms is shown in
Figure 3. Fairness between users and
the total cell capacity are a trade-off
because scheduling data equally to all
users doesn’t take into account
momentary changes in the radio
channel quality and cannot maximize
the cell throughput. On the other hand,
maximizing cell throughput by
scheduling users with best radio channel
quality cannot quarantee Quality Of
Service (QoS) for all users in the cell.
Advanced scheduling algorithm gives
the best balance of QoS and cell capacity.
Advanced mobile terminals with
features like dual antenna reception and
equalized receivers can benefit directly
from HSDPA.
Another important characteristic of
HSDPA is the reduced downlink
transmission delay and reduced variance
in delay. A short delay time is important
for many applications such as interactive
games. In general, HSDPA’s enhancements
can be used to implement efficiently the
‘interactive’ and ‘background’ QoS classes
standardized by 3GPP. HSDPA’s high data
rates also improve the use of streaming
applications on shared packet channels,
while the shortened roundtrip time will
benefit web-browsing.
White Paper
HSDPA data rates
HSDPA data rates are dynamically
adjusted during the call according to
radio link quality. This ensures the
highest possible data rate for the user.
HSUPA Improvements
The main technological improvements
with HSUPA are:
• Fast uplink scheduling function based
in the BTS
• Fast retransmission with control in
the BTS
Modulation
Coding rate
Throughput
with 5 codes
Throughput
with 10 codes
Throughput
with 15 codes
QPSK
1/4
600 kbps
1,2 Mbps
1,8 Mbps
2/4
1,2 Mbps
2,4 Mbps
4,8 Mbps
3/4
1,8 Mbps
3,6 Mbps
5,4 Mbps
2/4
2,4 Mbps
4,8 Mbps
7,2 Mbps
3/4
3,6 Mbps
7,2 Mbps
10,7 Mbps
4/4
4,8 Mbps
9,6 Mbps
14,4 Mbps
16QAM
Table 1. HSDPA peak data rates.
Probability
Fast uplink scheduling
Similar to HSDPA, HSUPA control for
uplink scheduling is moved to the BTS.
The BTS can do the scheduling based
on the information readily available in
the BTS or based on terminal feedback
which can include, for example,
information about whether a terminal
would like to increase the transmission
rate.
RNC scheduling
Node B scheduling
Fast uplink retransmissions
As with the downlink without HSDPA,
the uplink currently relies on
retransmission control by the RNC.
By moving the retransmission handling
to the BTS, faster response times and
less roundtrip delay can be achieved.
Noise rise (dB)
Figure 4. Fast scheduling reduces noise rise variance.
HSUPA performance
Fast scheduling in the uplink can react
rapidly to changes in the traffic load
and offered data rate from applications.
This reduces noise rise variations in the
uplink and gives an opportunity to
reduce the head-room reserved in the
uplink for overload protection. Higher
user data rates and cell capacity are
achieved by using this capacity that was
reserved in Release 99 solutions.
In addition to fast scheduling, fast
retransmissions and incremental
redundancy contribute to enhanced
uplink performance. Fast retransmissions
allow the uplink to operate with a
higher block error ratio (BLER) and this
enables initial transmission with a
lower power level for a given data rate.
With a fixed data rate, the cell range is
also improved since lower energy per bit
is needed.
Kbps per cell
2500
+45%
2000
+25%
+10%
1500
1000
500
0
Release 99
Fast retransmit
Node B
scheduling
Fast proportional
scheduling
Figure 5. Example of user throughput gain in a loaded cell. Average user throughput with 21 users per cell can be
50% higher than in Release 99.
5
White Paper
HSUPA data rates
The wide bandwidth of WCDMA gives
high user data rates with one code
transmission, which provides efficient
Mobile terminal RF performance.
Coding rate
User data rate
with 1 code
User data rate
with 2 codes
User data rate
with 4 codes
User data rate
with 6 codes
2/3
640 kbps
1,28 Mbps
2,56 Mbps
3,84 Mbps
3/4
720 kbps
1,44 Mbps
2,88 Mbps
4,32 Mbps
4/4
960 kbps
1,92 Mbps
3,84 Mbps
5,76 Mbps
Table 2. Example of HSUPA peak data rates with spreading factor 4.
Nokia High Speed Packet Access implementation
A key attribute of Nokia’s WCDMA
infrastructure is its flexibility for future
upgrades. Even features in the earliest
stages of standardization have been
taken into account in the Radio Access
Network architecture and in system
design and specification. This approach
enables Nokia to implement HSDPA into
its current RAN platforms through
simple upgrades.
Being able to integrate HSDPA and nonHSDPA (WCDMA Release 99) traffic into
the same carrier is essential. With the
Nokia solution, this is achieved without
upgrading the base station’s radio
elements. Consequently, HSDPA can boost
user and system performance using the
initial (5 MHz) frequency layer.
Figure 6 shows an example of power
resource sharing between non-HSDPA
users (for example speech traffic) and
HSDPA users on the same carrier. The
power allocated to HSDPA is dynamically
adjusted by the RNC according to the
instantaneous traffic requirements.
HSDPA uses fast link adaptation and
does not need head-room for fast power
control.
Furthermore, with HSDPA the DCH is
typically used to carry time critical
signalling information and
conversational type services, such as
speech in parallel with HSDPA operation.
Thus the user can benefit from a
simultaneous speech connection on the
DCH in parallel with, for example, a high
speed data download on the HS-DSCH.
6
BTS Transmit power
Maximum power
Power control
head-room for DCH
HSDPA
Target power
HSDPA power
DCH
Non-HSDPA power
Common channels
Figure 6. Carrier power sharing between HSDPA and DCH
traffic.
Nokia WCDMA base stations can
accommodate HSDPA by either upgrading
the software in existing baseband units
in the field, or by adding baseband units
to accommodate HSDPA traffic volumes
while keeping existing baseband to
serve the Release 99 based traffic.
Nokia baseband contains powerful
processors that can handle both uplink
and downlink in the same unit.
This eliminates communication between
separate uplink and downlink baseband
units, which results in fast scheduling
and easier reaction to uplink HSDPA
control signalling.
Furthermore, the use of powerful
integrated baseband simplifies system
evolution and makes it easier to adapt to
asymmetric traffic. When introducing
new features in the network, processing
power can be allocated between the
downlink and the uplink based on traffic
needs, with no onsite HW upgrades
needed.
Nokia HSDPA is also fully backwards
compatible with 3GPP Release 99
WCDMA. This enables HSDPA to be
introduced into networks gradually.
Both Release 99 and HSDPA capable
terminals can share the same radio
carriers.
The versatile Nokia BTS platform can
also accommodate the changes expected
to arise from HSUPA improvements,
such as BTS-based scheduling or
retransmission handling. The powerful
baseband processors can handle traffic
in either direction depending on the
software.
White Paper
Key benefits of Nokia High
Speed Packet Access evolution
Glossary
16QAM
HSDPA and HSUPA will
optimize the network to
enable lower production
cost per bit
The Nokia High Speed Packet Access
solution will benefit network operators by:
• Improving the WCDMA network’s
packet data capacity
• Enhancing spectral efficiency
• Increasing BTS baseband and Iub
efficiency
• Enabling cost-effective network
implementation
Consequently, network operators that
implement HSDPA and HSUPA will
achieve a lower delivery cost per bit.
HSDPA and HSUPA will
improve the perceived
value of user services
The Nokia High Speed Packet Access
solution will benefit users by providing:
• Higher data rates
• Shorter service response time
• Better availability of services
Consequently, users will experience
better quality of service.
16 Quadrature Amplitude
Modulation
3GPP
Third Generation Partnership
Project
BLER
Block error ratio
BTS
Base Station
DCH
Dedicated Channel
(transport channel)
HS-DSCH High Speed Downlink Shared
Channel
HS-DPCCH High Speed Dedicated
Physical Control Channel
HS-SCCH High Speed Shared Control
Channel
HSDPA
High Speed Downlink Packet
Access
HSPA
High Speed Packet Access
HSUPA
High Speed Uplink Packet
Access
HW
Hardware
IP
Internet Protocol
Iub
Connection between Radio
Network Controller and
Base Station
MS
Mobile Station
PS
Packet Switched
QoS
Quality of Service
QPSK
Quadrature Phase Shift
Keying
RAN
Radio Access Network
RLC
Radio Link Control
RNC
Radio Network Controller
SW
Software
WCDMA Wideband Code Division
Multiple Access
The contents of this document are copyright © 2004 Nokia. All rights reserved. A license is hereby granted to download and print a copy of this document for personal use only.
No other license to any other intellectual property rights is granted herein. Unless expressly permitted herein, reproduction, transfer, distribution or storage of part or all of
the contents in any form without the prior written permission of Nokia is prohibited.
The content of this document is provided “as is”, without warranties of any kind with regards its accuracy or reliability, and specifically excluding all implied warranties,
for example of merchantability, fitness for purpose, title and non-infringement. In no event shall Nokia be liable for any special, indirect or consequential damages, or any
damages whatsoever resulting form loss of use, data or profits, arising out of or in connection with the use of the document. Nokia reserves the right to revise the document
or withdraw it at any time without prior notice.
Nokia and Nokia Connecting People are registered trademarks of Nokia Corporation. Nokia product names are either trademarks or registered trademarks of Nokia.
Other product and company names mentioned herein may be trademarks or trade names of their respective owners.
7
NOKIA CORPORATION
Networks
P.O. Box 300
FIN-00045 NOKIA GROUP, Finland
Phone: +358 (0) 7180 08000
www.nokia.com
Nokia code: 11183 – 0604 Indivisual/Libris
Copyright © 2004 Nokia. All rights reserved. Nokia and Nokia Connecting People are registered trademarks of Nokia Corporation.
Other product and company names mentioned herein may be trademarks or trade names of their respective owners.
Products are subject to change without notice.
1 (1)
Office of the Telecommunications Authority
29/F Wu Chung House
213 Queen’s Road East
Wanchai
Hong Kong
Fax No: 2803 5112
Email: [email protected]
Attention: Senior Telecommunications Engineer (Technical Regulation)
18th June 2004
Subject: OFTA's 2nd Consultation Paper dated 19 March 2004 on "Licensing of Mobile Services on
Expiry of Existing Licences for 2nd Generation Mobile Services in Hong Kong"
Dear Sir / Madam
We are writing to make our submission in response to the above Consultation Paper.
Nokia is a global supplier of both terminals and network infrastructure for mobile communications and as
such will also be providing input separately regarding the technology considerations for the use of the
frequency band. Nokia would like to offer its thoughts here on the proposed approach towards the
existing CDMA and TDMA licence holders.
Nokia understands that spectrum is a scarce resource and needs to be utilised appropriately to ensure
maximum benefit; however Nokia would like to suggest that additional factors should also be considered
in deciding the most appropriate course of action in this regard:
Investment. The nature of mobile communications requires large-scale capital investment that can only
be recovered over a long period of time. In order for existing operators to realize their potential they
require a regulatory environment that will allow the business sufficient time to recoup its investments and
manage its progression in a systematic way.
Disruption to users. As you would appreciate, any proposed changes in spectrum allocation and
discontinuities would cause interruption of services to the users. Given the experience of existing
operators, they would be in a better position to handle any service impact to the end user.
Sustainability. The recent history of the telecommunications industry would suggest that the
sustainability of the operator landscape in a competitive environment such as Hong Kong is an important
consideration. The introduction of new players and technologies into an already fragmented market may
ultimately be detrimental to the development of the market.
In light of the above Nokia would urge OFTA to weigh the investment of the existing operators, market
competition, and service quality issues carefully before proceeding, giving adequate time to foster
market stability, and in order to promote the best possible service to the Hong Kong population.
Yours sincerely
Stephen Tsang
Business Director
Nokia Networks