Personal Broadband Observatory
4G Business Case for 2.6 GHz
Andrea Calcagno, Observatory Chairman
and CEO & EVP WiTech SpA
1

Agenda
• 4G Technologies
• 4G Deployment Model
• Business Case
• Conclusion

4G Technologies
Mobile WiMAX
Rel 1.5 802.16e-2005 Rel 2.0 802.16m
Rel 1.0 802.16e-2005
IP E2E Network
3GPP
IMT-
HSPA Rel-6 HSPA+ Rel-7 &Rel-8 Advanced
CKT Switched Network
LTE & LTE Advanced
IP E2E Network
2008 2009 2010 2011 2012
OFDMA - Based
CDMA - Based

4G Technologies
2G/3G/3.5G
T1,E1
2G/3G/3.5G Core Network
Next Generation
Access Network
All-IP Core
Data Overlay or Replacement Increased
Network
BH Capacity
LTE or WiMAX
Comparable Capex – New Spectrum Need

4G Technologies

Deployment Model
Hotspot coverage Home Base Station
National Coverage
Urban Coverage

Business Case
Operator Type: CLEC (COMPETITIVE LOCAL EXCHANGE CARRIER) or Green Field
Scenario: Urban Coverage
( Roma, Milano, Napoli, Torino , Firenze)
Urban Scenario Dense Urban Scenario
4G Technology: LTE ( 10 MHz, FDD, MIMO 2x2)
Band: 2.6 GHz
Target Market: Consumer
Service Profile: Mobile Broadband (Flat Data and VoIP)
Devices: Handset and Tablet
Business Case Tool: TEA|LTE

Business Case – Market Analysis
Summary
Roma

Business Case – Market Analysis|Service Profile
Handset 70% - Tablet 30%

Business Case – Market Analysis|Forecast
Roma|Total Users Forecast

Business Case – Market Analysis|Forecast
Roma|Lost Users Forecast

Business Case – Market Analysis|Forecast
Roma|Net Users Forecast

Business Case – Market Analysis|Forecast
Total Net Users Forecast

Business Case – Market Analysis|Forecast
Total Revenues

Business Case – Technical Analysis|Technology
4G Technology: LTE ( 10 MHz, FDD, MIMO 2x2)
Band: 2.6 GHz

Business Case – Technical Analysis|Equipment
Base Station: eNode B Devices

Business Case – Technical Analysis|Perfomance

Business Case – Technical Analysis|Perfomance

Business Case – Technical Network Dimensioning
MME
S-GW/P-GW
eNode B
UT

Business Case – Technical Network Dimensioning
MME
S-GW/P-GW
DA RIFARE
eNode B
UT
e Node B with MW BH
Urban 20%
Dense Urban 10%

Business Case – Roll Out
MME
S-GW/P-GW
eNode B
UT

Business Case – EF Analysis
Personnel

Business Case – EF Analysis
CAPEX & OPEX

Business Case – EF Analysis
Income Statement
EBITDA > 0 3rd Year
EBIT > 0 4th Year
Net Income > 0 6th Year

Business Case – EF Analysis
Cash Flow
Peak Funding 74 M€
PBP 6.3 Years
NPV 18,45 M€
CFCF 100 M€

Business Case – Conclusion
4G Business Case – Urban Coverage – CLEC/Green Field
Value Added Applications
ARPU Advertising Revenues
Broadband Devices
New pricing model
Customer More devices for User
Appl. Open Access
Lifetime Better User Experience
No Legacy
OPEX FTTS
Flat Architecture
Economies of scale
CAPEX All-IP Network
Spectral Effinciency
Virtual Network Opportunity

Backup
Slide sul Business Case Tool: TEA-LTE

WiMAX & LTE Project Life-Cycle (1)
As for any carrier-class Broadband Wireless Access infrastructure,
building a WiMAX & LTE network is and will remain a complex
undertaking, …
Business Case Quality Assurance Optimization
Definitive Project
Services Launch
Budget Allocation Network Building

WiMAX & LTE Project Life-Cycle (2)
… and the initial planning phases are particularly critical to set a solid
foundation for the success of the initiative. …
Business Case Definitive Project Quality Assurance Optimization
Services Launch
Budget Allocation Network Building

A Holistic, Iterative Approach is
Needed Since the Outset
Taking into account all technology and business aspects to ensure an iterative
alignment of business and technology strategies allowing to identify all main cost
drivers
Market Analysis
Evaluating the potential market for WiMAX & LTE services,
identifying target markets, defining service profiles, and
forecasting Revenues
Scenario & Sensitivity
Technical Analysis
Analysis Dimensioning the WiMAX & LTE
Iterative fine-tuning of the WiMAX Access and Backhauling network
& LTE Business Plan, analyzing infrastructures, defining the
the influence of parameter and required bill of quantities
boundary condition changes
Economic & Financial Analysis
Calculating Capex & Opex and
evaluating all WiMAX & LTE Business Plan’s KPI

WiTech TEA Family of Business Case
Analysis Tools
Supporting 4G operators, vendors and consultants in their strategic planning
activities with thoroughly integrated techno-economic analyses
TM
Market
Analysis
Technical
Scenario &
TM
Analysis
Sensitivity
Analysis
LTE Economic &
Financial
Analysis

WiTech TEA Family of Business Case
Analysis Tools
TM
Based on real best practices
Equipped with well calibrated, WiMAX & LTE
technology-related market, technical, and
economic models
Presenting manageable Input and Output
TM
with meaningful correlations
Supporting an iterative way of working by
design through an easy-to-use, dashboard-
styled GUI
LTE

TEA|WIMAX & TEA|LTE – Market
Analysis
Evaluating the potential market for
WiMAX & LTE services,
considering:
– Type of territory (dense urban,
urban, suburban/exurban, rural)
– Type of segment (residential/soho;
small, middle, and large
enterprises/institutions)
– Type of application model (fixed,
nomadic, portable, and mobile)
– Type of service (technical
characteristics and pricing policies)
– Churn impact

TEA|WIMAX & TEA|LTE – Technical
Analysis
Preliminary dimensioning the WiMAX &
LTE Access & Backhauling network
infrastructures, considering:
– Down-link and up-link capacity demand
(by market segment and rollout plan)
– Aggregated total capacity
– Existing backbone infrastructures
– Type of wireless backhauling
technology (SDH, PDH, IP Ethernet,
License exempt)
– Base Station / Enhanced Node B & User
Terminal / User Equipment
characterization (antenna gain, transmit
power, diversity gain, losses, sector
number, terminal type, MIMO)
– Path loss model (Cost-231, SUI, ECC-33,
Log-Normal with/without Shadowing,
Free Space)
– Compliance with standard WiMAX
Forum’s Fixed & Mobile System Profiles
(plus the possibility to define custom
profiles)

TEA|WIMAX & TEA|LTE – Economic &
Financial Analysis
Calculating all key economic &
financial figures and evaluating
KPI in the WiMAX & LTE
initiative's Business Plan:
– Capex & Opex (spectrum
license, connectivity,
backhauling, BTS / eNB, UT /
UE, ASN GW & CSN / EPC &
CN, personnel, marketing,
SG&A, etc.)
– Depreciations
– TCO (Total Cost of Ownership)
– Relevant Indicators (Gross
Margin, EBITDA, EBIT, NPV,
IRR, PBP, Shareholder value,
etc.)

TEA|WIMAX & TEA|LTE – Scenario &
Sensitivity Analysis
Enabling the user to fine-tune
the WiMAX & LTE initiative’s
business plan, in real-time and
total privacy, and to view the
results in an animated
graphical format instantly for
all analyses:
– Market Analysis
– Technical Analysis
– Economic & Financial
Analysis