The document discusses how telecommunications networks and services are changing, with traffic growing exponentially while revenues grow slowly. This gap between traffic and revenue is not sustainable. The document proposes that innovation and reform are needed towards more sustainability, including limiting traffic growth, reducing delivery costs, and finding new revenue streams. One approach discussed is deploying small cells including LTE small cells and femtocells, which can offer a cheaper network with higher performance and new services/applications to generate revenue.

1. Where Are We Going?
Broadband/Mobile Broadband
the 4th Utility
LTE North America
Dallas – 10th and 11th Nov 2010
Dr Shahram G Niri
Director of LTE/SAE Global Strategy & Solution – NEC Europe

2. Table of Content
Changing telecom industry (Services & Users, Networks)
Diverged traffic and revenue growth
Innovation & Reform Towards More Sustainability
The need for Small Cells for capacity and performance in the future NWs
Concluding remarks
Page 2

3. Changing Telecom Industry
Users will grow in importance
 Customer delight is absolutely essential
 Adopting new habits (e.g. social media, video addiction, ...)
 More demanding on the quality, interactivity, personalisation
Services will grow in multiplicity, diversity and richness
 New services with the Internet at the heart the services
More powerful and enabled devices
Networks will grow in complexity
 Hyper connectivity and increasing demand for capacity
High capacity pipes with intelligent plumbing
Self managed and automated networks
Communication delivered through SW on standards / generic HW
New business models will be in place
New ecosystem & new player, and revenue models
Communication networks to improve in intelligence, flexibility,
automation, resilience, efficiency, speed, security, privacy, latency
Page 3

4. Diverged Traffic & Revenue Growth
50 Telecoms Price Development
Significant growth in traffic while slow in revenue 40 Mobile
Broadband
 Ubiquitous Internet-based in hyper connected NWs 30
 Hundred-fold increase in network flow brought by mass
Euro/Month
terminals and mass digital content 20
 Users are spending more time on the phone & internet 10
 Average household spending on communication falls
 Consumer pay less while getting better value -> they 0
pay ~30% less than 5 years ago 2002 2003 2004 2005 2006 2007 2008 2009
 Significant growth in traffic while slow in revenue
Traffic
Broadband/Mobile Broadband the 4th Utility
Ubiquitous , high quality and affordable inter-based
broadband essential to the functioning of modern life &
society Gap
Revenue
From Kilo (103 ) bytes to Tera (1012 ) and Zeta (1021 ) bytes
Time
YET lower delivery cost per bit/per sub/per sq km
Page 4

5. Innovation & Reform Towards More Sustainability
Cost Vs Revenue does not add up
User experience at risk
Limit/control it (e.g. Cap in flat rate)
Bring the cost of it down (e.g. More efficient deliveries in radio, transport and core
network, Optimizations and other means of traffic handling
Turn it to revenue (e.g. Innovative solutions, New revenue streams and sources)
Small Cell Deployments
Alternative NW topologies
LTE Small Cells
Bigger, Smarter & Cheaper pipe Relay xG
Cheaper NW operation
Higher performance Femto 4G
Pico 3G
LTE Femto
Intelligent Indoor Solution
Micro 2G
 New services & applications Macro 1G
Cost saving and revenue generation
Carrier Cloud
 New service & revenue model
 Service differentiation
Cost optimization
Lower cost & better performance and new revenue streams needed
Page 5

6. Small Cells; Smart Way to Future Mobile Broadband
LTE and HSDPA performance relative to Theoretical Limits
6.00
Spectrum is a finite resources, scarce & expensive 5.00
Achievable Efficiency (bps/Hz)
LTE/HSPA link level spectrum efficiencies close to
shannon limit
HSDPA
4.00
theoretical limits LTE
 Other factors such as Coding & Modulation, MIMO and
3.00
more spectrum contribute towards higher capacity – 2.00
Spectrum highest contributor! 1.00
0.00
-10.00 -5 0 5 10.00 15.00
Alternative LTE deployments (Small Cell - Pico Required SNR (db)
/Femto cells) needed to avoid capacity shortfalls
30.00
Specturm
Frequency reuse is the key to keep up with exponential 25.00 MIMO
Modulation & Coding
increase of traffic in the future with limited spectrum 20.00
availability
Improves the QoS in the network – better user 15.00
experience 10.00
Allows for faster, more flexible, cheaper and easier 5.00
deployment and operation
0.00
GSM GPRS EDGE HSDPA HSPA+ LTE
New network topologies and deployment strategy offer more gain than
new technologies and HW
Page 6

7. More Capacity & Better Performance (HSPA+ Vs LTE)
3G based NW could run out
of capacity in 2010+ Network Capacity offered per device V.S.
HSPA
Forecast Traffic per device
Network Capacity/Forecast Traffic (MB/month)
HSPA+ needs major H/W 3000
upgrade to offer satisfactory
performance & capacity;
HSPA+
HSPA+ will not have 2500
More usage due to
considerable improvements over improved performance
HSPA and will have short life time
2000
LTE &
HSPA
LTE as an essential upgrade
for all 3G operators will offer 1500
LTE with small
better user experience (lower cells & Femto
LTE &
HSPA &
latency, higher data rate, 1000 Femto
better availability of higher
data rate, better QoE at cell Traffic
per
edge) 500
device
Alternative LTE 0 Potential
deployments (Small Cell - Pico 2008 2009 2010 2011 2012 2013 2014 traffic
/Femto cells) needed to avoid
capacity shortfalls
A constant challenge to keep ahead of future traffic increase
Page 7
7 © NEC Corporation 2009

8. Think Big – Deploy Small Cells LTE
LTE Macro deployment is not an option Coverage Layer
 Will not offer the necessary capacity and performance 1
with large /macro cells
 High cost of outdoor/macro radio 2
3 4
 Data traffic /revenue mainly in hotspots & in-building
 2G and 3G networks (already provide macro coverage)
1 Coverage Driven
Macro
LTE Small Cell as Overlay capacity and performance layer Macro deployment
Micro
 A sustainable solution towards ever increasing capacity

Pico
demand Capacity Layer
 Fast to deploy, cheap and easy to install and operate Femto
 Start small and build as your number of users / traffic (Residential /SME) 4
increases 2
1 3
 Revenue generation where the traffic is
HSPA & LTE (Coverage Layer) LTE (Capacity Layer) 2
2G/3G Capacity Driven
Hotspots and high traffic zones
4
LTE Hot spot/Metro
3
2 1
LTE Femto
3 New Business Driven
LTE Femto Femto and hotspot islands
Page 8

9. More Network Capacity by LTE Small Cells
Comparison of small Vs medium cell (DL)
For the same traffic density, ISD 200m
OMNI offers x 2.5 (x 3.5 in UL) user data rate
on average, or x3 (x8 in UL) user data rate
for cell edge user
If targeting mean user data rate 10Mbps,
5%-tile user data rate 2Mbps, ISD 200m 2
OMNI offers ~4x system throughput
The figures are MUCH higher if compared
with larger cells
Comparison of Macro & Macro+ Small (DL)
 for the same traffic density mixed
deployment offer ~2.5 x user data rate or ~2.4x user data rate
If targeting mean user data rate of 10 Mbps,
~1.7x
the mixed deployment scenario offer ~1.8 x Capacity
capacity
The figure are even higher for uplink (6X and
2.5 times)
Significant improvement by deploying small cells in terms of cost per bit per Km2
Page 9 9
Page

10. High Performance yet Cheap, Easy and Fast deployment
High capacity and performance
Zero foot print, Wall/Poll Mount Indoor deployment
No site acquisition necessary
Flexible and fast deployments
Self configuration & one-touch by SON
Indoor & outdoor installation
Cascade
Fan less and air-cooling
Green & low power consumption
• 420mm x 230mm x 130mm, ~12kg
Outdoor
deployment Pole installation 3 x4W all-in-one S1
Distributed
Antenna
S1
Wall installation 1x4W all-in-one
Page 10
Page 10

11. LTE Small Cells for Operators & End Users
 Savings due to power, site  Faster data rates at high traffic
rental, operation manpower locations
 Saving in site acquisition,  Better and higher availability
installation and civil work of high data rate multimedia
 Build as you grow where the services
investment needed User  Longer terminal battery life
Cost
 Cost efficient capacity Experience due to lower transmit power
provision to high traffic areas requirement
 Fast LTE deployment
 More capacity at reduced  Target high revenue locations
cost per bit NW Business
 New revenue streams from
 Higher average and peak cell Peformance Opportunities
Pockets of Services with Cloud
edge throughput Computing
 Last mile broadband solution
Page 11

12. Concluding Remarks
Mobile broadband is a reality, potentials are huge but challenges are huge too
Broadband/mobile broadband as the 4th utility will be an integral part of modern life
& society
Spectrum is a finite, scarce and expensive resources
New innovative solution will be key to the success of mobile broadband (lower TCO,
flexibility and scalability in the deployment, simplicity and ease of operation)
New network topologies and deployment strategy offer more gain than new
technologies and HW
Small cells as a cost effective and future proof technology is a key to future mobile
broadband
An overlay network with LTE small cells and LTE Femto deployment is the way
forward
Page 12