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Operators Prepare for Mobile Internet Surge

Demand for smartphones, regular mobile phones, and wireless broadband services continues to drive the carrier base station market, according to the latest market study by In-Stat. The number of newly deployed macro cellular base stations will grow over 10 percent in 2009.

Of new macro cellular base station shipments, WCDMA base station shipments will make up the lion's share of all base station shipments worldwide, accounting for about 50 percent of the total base station revenue.

By 2013, In-Stat forecasts that the percent that WCDMA contributes to total base station revenue will exceed 70 percent and LTE base stations will account for another 20 percent of the total.

"WCDMA/HSPA base stations will be the work horses of wireless data networks," says Allen Nogee, In-Stat analyst. "Many operators, worldwide, are in the process of rolling out, or enhancing, their current CDMA networks, including a very large rollout of CDMA by China Unicom. China Unicom was awarded the WCDMA contract to provide services in China. WCDMA will gain the most subscribers, with CDMA2000 and TD-SCDMA taking the distant second and third positions."

In-Stat's market study found the following:

- From 2008 to 2013, total base station revenue is forecast to decrease by almost 3 percent CAGR. Not only do base stations continue to drop in price, but also the mix of base stations is changing. Smaller base stations are being deployed, and many more LTE base stations are forecast to ship. LTE base stations are significantly cheaper than WCDMA base stations and this will account for much in the way of decreased base station revenue going forward.

- While there is no growth for GSM in areas that are transitioning to WCDMA, there is growth of GSM subscribers in Africa, India, China, and Latin and South America. Still, In-Stat believes that GSM base station shipments will decline every year going forward.

- The fastest base station technology to grow, in terms of compound annual growth rate is TD-SCDMA, but this can be a bit misleading, because TD-SCDMA is a new technology recently licensed as a 3G technology in China and the technology didn't exist much before 2007.

- LTE is rolling out. The majority of the committed operators have roll-outs scheduled for 2012 and 2013. In the U.S., Verizon is in the process of deploying LTE. Verizon has said that it hopes to have 20–30 markets with operating LTE by the end of 2010, with more in 2011, and an LTE smartphone as well in 2011.

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