4G (LTE) Business Case for 2.6 GHz

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Building carrier-class LTE networks is a complex undertaking and the initial planning stage, where the business case is defined and the budget is allocated, is critical for setting a solid foundation for the success of the initiative.
During this webinar, participants will learn a holistic, iterative approach to developing business cases for LTE Networks. Participants will also get exposure to various tools available as well as best practices used in network planning.

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4G (LTE) Business Case for 2.6 GHz

  1. 1. Personal Broadband Observatory 4G Business Case for 2.6 GHz Andrea Calcagno, Observatory Chairman and CEO & EVP WiTech SpA 1
  2. 2. Agenda • 4G Technologies • 4G Deployment Model • Business Case • Conclusion
  3. 3. 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
  4. 4. 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
  5. 5. 4G Technologies
  6. 6. Deployment Model Hotspot coverage Home Base Station National Coverage Urban Coverage
  7. 7. 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
  8. 8. Business Case – Market Analysis Summary Roma
  9. 9. Business Case – Market Analysis|Service Profile Handset 70% - Tablet 30%
  10. 10. Business Case – Market Analysis|Forecast Roma|Total Users Forecast
  11. 11. Business Case – Market Analysis|Forecast Roma|Lost Users Forecast
  12. 12. Business Case – Market Analysis|Forecast Roma|Net Users Forecast
  13. 13. Business Case – Market Analysis|Forecast Total Net Users Forecast
  14. 14. Business Case – Market Analysis|Forecast Total Revenues
  15. 15. Business Case – Technical Analysis|Technology 4G Technology: LTE ( 10 MHz, FDD, MIMO 2x2) Band: 2.6 GHz
  16. 16. Business Case – Technical Analysis|Equipment Base Station: eNode B Devices
  17. 17. Business Case – Technical Analysis|Perfomance
  18. 18. Business Case – Technical Analysis|Perfomance
  19. 19. Business Case – Technical Network Dimensioning MME S-GW/P-GW eNode B UT
  20. 20. 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%
  21. 21. Business Case – Roll Out MME S-GW/P-GW eNode B UT
  22. 22. Business Case – EF Analysis Personnel
  23. 23. Business Case – EF Analysis CAPEX & OPEX
  24. 24. Business Case – EF Analysis Income Statement EBITDA > 0 3rd Year EBIT > 0 4th Year Net Income > 0 6th Year
  25. 25. Business Case – EF Analysis Cash Flow Peak Funding 74 M€ PBP 6.3 Years NPV 18,45 M€ CFCF 100 M€
  26. 26. 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
  27. 27. Backup Slide sul Business Case Tool: TEA-LTE
  28. 28. 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
  29. 29. 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
  30. 30. 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
  31. 31. 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
  32. 32. 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
  33. 33. 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
  34. 34. 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)
  35. 35. 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.)
  36. 36. 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

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