4G Telecom Trends

Global Trends and Key Success Factors for Indian deployment

10/22/20131 Priyom Sarkar

4G (LTE)

Technology and Implications

2

4G (LTE)- Index

Technology Evolution

LTE Architecture

Global LTE Ecosystem

Network rollouts

Devices

Indian Situation

Key Impact on Broadcast Sector Sector

4G User Profile

3

Mobile technologies have evolved from voice focused to

data focused with speeds reaching 170 Mbps with 4G

4

1G

• 1980

2G

• 1991

2.5G+

• 1999

3G

• 2001+

3.5G

• 2005

4G

• 2010

Do

wn

link S

pe

ed

s(n

ot to

scale

)

Analog GSM, CDMA(Digital introduced)

GPRS, EDGE(interim marketing release)

WCDMA (UMTS), CDMA 1x EV-DO(Reliable Video experience)

HSDPA, HSUPA, HSPA +(Interim marketing release)

LTE, WiMax(speeds comparable to FBB)

9.6 kbps

14.4 kbps

Realized

Theory

20-50 kbps

100-130 kbps

384-400 kbps

2-3 Mbps

5-8 Mbps

10-15 mbps

128 kbps

384 kbps

2Mbps

21.1 Mbps

42 Mbps

170 Mbps

Sources: 3GPP Alliance, UMTS Forum, Informa Telecoms & Media, Motorola, ZTE, Huawei, internal analysis

GSM: Global System for Mobile communications, TDMA: Time Division Multiple Access, GPRS: General Packet Radio Service, EDGE: Enhanced Data rates for GSM

Evolution, (W) CDMA: (Wideband) Code Division Multiple Access, EV-DO: Evolution Data-Optimized, HSDPA: High-Speed Downlink Packet Access, HSUPA: High-

Speed Uplink Packet Access, TD-SCDMA: Time Division Synchronous Code Division Multiple Access, LTE: Long Term Evolution, FBB: Fixed Broadband

Note: 5MHz

bandwidth

considered in

all cases

4G Architecture is optimized for fast speeds

5

LTE: Evolution from separate switching core sub-domains to one common IP core facilitating faster access

Voice is also treated as data (Voice over Internet Protocol – VoIP)

VoIP can be VoLTE (nascent – for data only operators) or CSFB (falls back to 2G for voice)

Source: Ericsson

Strong demand is expected for these high

speed networks

6

0

2000

4000

6000

8000

10000

2009 2010 2011 2012 2013E 2014P 2015P 2016P 2017P 2018P

Mobile Subscriptions by technology (in mn)

LTE

WCDMA/HSPA

GSM/EDGE only

TD-SCDMA

CDMA

Other

LTE Technology is already commercial and maturing quickly

LTE subscriptions projected to reach 2 billion by 2018 from 126 mn as on Q2 2013

LTE: 126 mn

on Q2,’13

Source: Ericsson, gsacom.com

Network operators worldwide have geared

up to meet expected user demand

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First commercial LTE networks were launched by TeliaSonera in Norway and Sweden in December 2009

213 commercially launched LTE networks and 406 commercial network commitments in 81 countries

50 pre commitment trials in 9 more countries

TDD-LTE Deployments have started but lag

FDD deployments

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Presently 21 commercial LTE TDD networks exist

Further 39 LTE TDD networks are either under trial or planned

Over 1000 LTE Devices exist but are

primarily concentrated towards FDD mode

1064 LTE User devices have been announced from 111 manufacturers

2600 and 1800 MHz have the highest devices support

For 2300 MHz, 147 products in the market as on Aug, 2013

Lack of ecosystem may reduce attractiveness as handsets may not support international roaming because of incompatible bands, duplex modes and frequencies in different countries

9

362

322

265 265247

231 230 229

142 128104

164147

49 4913

Spectrum (MHz), Band

222 TDD

LTE

Devices

850 FDD LTE

Devices

As on Aug, 2013; Source: gsacom.com

Smartphone128%

Routers incl

Hotspots81

55%

Dongles32

22%

Femtocell1

1%

Mobile Tablet

53%

Module16

11%

2300 MHz TD LTE

In India, Major data push is expected to

come from Reliance Jio, Bharti and Aircel

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Source: DoT, GoI

Standalone BWA Standalone 3G 3G + BWA

Metro

Delhi

Mumbai

Kolkata

Circle A

Maharashtra

Gujarat

Andhra Pradesh

Karnataka

Tamil Nadu/Chennai

Circle B

Kerala

Punjab

Haryana

Uttar Pradesh (East)

Uttar Pradest (West)

Rajasthan

Madhya Pradesh

West Bengal

Circle C

Himachal Pradesh

Bihar

Orissa

Assam

North East

Jammu & Kashmir

Standalone BWA Circles 22 2 - - - - - - 5 1

Standalone 3G Circles NA 12 9 13 11 9 5 - NA NA NA

3G + BWA Circles NA 1 - - - - 8 22 NA NA NA

Circles with no 3G / BWA - 7 13 9 11 13 9 - 22** 17 21

*

*Bharti has purchased Qualcomm’s BWA licenses in Delhi, Mumbai, Haryana and Kerala

**Videocon has won spectrum (1800 MHz) in six circles : Bihar, Gujarat, Haryana, MP, UP (E) & UP (W) in Nov, 2012 auction. As

the spectrum is liberalised, operators can use the airwave for any technology

Augere is trying to sell off its 4G spectrum in Madhya Pradesh – further consolidation expected as stated by Mr. Sibal

1800 MHz liberalized**

NA

3G uptake has been slow in India

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Active 3G subs: ~32 mn out of 870 mn total subs on Q1, 2013

(3.5 % penetration)

Average 3G site coverage:16.5% for top 3 players in 3G

Source: mobiThinking, lughtreading.in, IDFC, internal analysis

7.2

6.4

5.1

3.3

9.7

31.7

RCOM Bharti Idea Vodafone Others* Total*

3G Active Subs (mn, Mar,13)

*Others and Total approximated from June 12 ratios of top 4 vs. others

25,604

17,481

11,659

19%

16%13%

0%

15%

30%

45%

0

10,000

20,000

30,000

Airtel Idea RCom

3G Site Coverage

3G Sites % of total sites

Indian 4G scenario is nascent and suffers from lack of ecosystem support

Globally most 4G devices are compatible with FDD

China Telecom recently announced $8bn tenders for TDD devices – ecosystem to develop

rapidly with RIL / Indian players using TDD

Auction for 700 MHZ spectrum going to be key for Indian 4G deployments as economics

improve dramatically

Content availability is low (recently TataSky announced LiveTV on mobile, Zee Anmol a FTA

GEC is also available on Mobile platform)

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FDD

Better Range

Lower latency

More developed ecosystem

TDD

Requires less spectrum

Faster downlink possible

Duplex Mode: Time Division

2300

Higher signal interference

Lower coverage

700

No. of towers/ capex required

one third

Better device compatibility

Spectrum: 2300 MHz

4G handsets need to be priced optimally in

price sensitive Indian market

13

192

1

1156

237

5

1301 6

0%

50%

100%

4G 3G

Indian 3G/4G* enabled Phones

>40k

30k-40k

20k-30k

10k-20k

<10k

13 680

*None of the 4G devices shown above presently support 2300 MHz TD-LTE

Only 13 devices supporting 4G (non 2300 MHz TD-LTE) vis-à-vis 680 supporting 3G; after unified

licensing scheme, these devices may eventually support networks for different operators

More than 90% of 4G devices are above 20k (all but 1) vis-à-vis 55% for 3G

Smartphones expected to rise from 12% in 2013 to 49% of new sales in 2017

Huawei (Ascend P1) and LG (Optimus G) and Karbonn have announced plans to launch devices soon

Operators such as RJIL, Bharti, Videocon, etc. are testing voice calling on 4G

Operators may overcome limited devices support via MiFi personal routers

Source: pricedealsindia.com compiled by comparing across online retailers, , IDC

76 118 120

169 177 203 215 209 198 191 182 4

4 2

6 11 16

29 57 93 127 171

81

122 123

175 188 219

244 267

291 318

353 Phone Sales in India (mn)

Feature Phones Smartphones Total

4G is changing user behaviour

More than half are in 18-34 years old

Avg 4G user is 5 yrs younger than 3G

customer

Almost even split between male and

female (58-42)

18-2421%

25-3431%

35-4423%

45-5416%

55-647%

65+2%

Who is the user?(Age group)

Video Downloading, Uploading & Streaming

26%

Social Media13%

Video Calling &

other8%

File Sharing and Storage

2%

Web Browsing & Email

40%

Music & app downloading

and streaming

11%

What is s/he doing?

26% of time spent is on video and ~55%

of all video watched is through Youtube

(~15% overall)

A quarter of 4G users spend three or

more hours on the mobile internet every

day – strong engagement

Source: EE H1 report from UK market

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Broadcasters need to optimize their offering

to take advantage of 4G opportunity

• LTE opens up opportunity for VoD and Catchup TV on Mobile Networks

• Broadcasters need to identify and evaluate different pricing options for video units that may be most attractive for VoD

Programming

• Videos need to be available in multiple screens–mobile, tab, laptop, TV, etc.

Multi-Screen Support

• Push towards higher resolution (1080p, 4K and 3D) –for better realization

Multi-Format Support

• Focus on youth programming (52% users 18-34 years old)Targeting

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