Critical Success Factors

1
2.5G to 3G Migration

• Critical Success Factors

Presented by Moheb Adel Ramses Technical
Director, Mobile Networks MENA Region
The 8th Arab Telecom and Internet
Forum Shangri-La's Resort, Muscat - Oman 24 -25
May 2006
2
Overall Evolution and Industry Trend
Access business and Services business break up
Source HUAWEI
3
Wireless Network Trends

• The wireless networks converge in the core
  network and the terminal.
• Wireless access adds value to services, and
  users will choose best value connection.
• Usage goes indoor! More than 70 traffic has
  moved from highway to hallway

4
RAN Evolution Trends
WiFi
UMA/WiMAX
3GPP
WCDMA and CDMA2000 have very similar RAN
migration roadmaps.
UMTS
3GPP2
Source Qualcomm
CDMA2000
5
Core Network Evolution Trends
Softswitch MSC (R4)/LMSD
IMS/MMD (R5/R6)
Legacy MSC (R99)
CSCF
MSC Server
MSC Server
MGCF
MGCF
MISUP
SIP
MSC
MSC
SIP-T
Divided into MSC Server MGW
H.248
H.248
H.248
H.248
TDM
IP
TDM/IP
MGW
MGW
MGW
MGW
PSTN
CDMA BSS/ UMTS RAN
CDMA BSS/ UMTS RAN
CDMA BSS/ UMTS RAN
PSTN
PSTN

• UMTS and CDMA2000 also have very similar core
  network migration roadmaps.
• Soft-Switch is the optimum structure for voice
• IMS is the optimum structure for multimedia
  service
• SoftSwitch and IMS will coexist for a long time

6
GSM Market Growth
Source EMC World Cellular Database, Dec 2004
Source Informa

• The number of GSM subscribers will exceed 2
  billion by the end of 2007
• Lower End-to-End cost is the main strength of GSM
  networks
• MENA is still the fastest growing mobile market
• Voice and SMS are and will still be the main
  source of revenue for quite a long time

7
3G, a new engine to improve ARPU
Subscribers (Million)
Number of networks
UMTS subscribers number hit 44.6 million
worldwide by the end of 2005, an increase of 161
on the figure at the end of 2004.
44.6 millions Subs 83 UMTS networks
Source www.3gtoday.com

• Today, there are 108 commercial WCDMA operators
  in 47 countries. The majority are enabling HSDPA
  in their networks as the new baseline for 3G
  globally (www.gsacom.com )
• Green field UMTS networks are still facing
  relatively high price terminals
• GSM operators in MENA launch UMTS networks
  focusing on data services for high end users,
  despite the poor take-up of their 2.5G data
  services
• There is generally a limited amount of money
  available from users to increase the total
  revenues of operators
• HSDPA availability is currently boosting the 3G
  deployment, allowing a net differentiation
  between 2.5 and 3G services.
• HSDPA gathers momentum in the MENA, especially in
  the Gulf countries like UAE, Kuwait, Bahrain,
  Oman, etc

8
Migration Opportunities and Challenges

• How to balance 2G Network Expansion versus New 3G
  Service Launch?
• How to deploy UMTS step by step ?
• How to reduce TCO to optimize the revenues of the
  resulting network.

GSM operators should plan to make 3G
an Evolution rather than Migration
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TCO Saving in Lifecycle
(k EUR)

• OPEX represents more than half of the total cost
  of ownership.
• Rental, power consumption, leased lines and human
  resources are major parts of OPEX

TCO reduction is generally Crucial, especially
at this stage of 3G deployment
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Optimized Migration Plan Shared Core Networks
save CAPEX, OPEX and Improve Quality

• As a considerable step towards 3G deployment,
  we recommend GSM operators to adopt R4
  Soft-switch architecture whenever they are
• Deploying a new GSM network for a new license
• Expanding the core network for an existing GSM
  network
• Swapping legacy GSM MSC

Huawei Mobile Soft Switch and Packet CN achieve
2G/3G Convergence
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Optimized Migration Plan New Technologies Reduce
TCO in Node B

• Making maximum use of advanced Node B
  technologies considerably reduce TCO
• Integrated Digital PA higher power efficiency
  with lower power consumption
• Multi Carrier Transceivers software capacity
  expansion
• Full HSDPA performance lower cost per bit.
• Open CPRI interface lower industrial chain cost
• Distributed Node B easier site acquisition,
  installation and transportation

Macro indoor
Macro Outdoor
Pico Node B
Mini Node B
Distributed NodeB
RRU
Optical Fiber CPRI
BBU 19 inch box
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Optimized Migration Plan Balanced Transmission
Cost and QoS with Hybrid Transmission
E1 for CS Services and High QoS PS services
E1
Node B
IP network
RNC
IP Network for best effort PS services

• Balance of transmission cost saving and QoS
  guarantee
• Most efficient transmission solution for
  HSDPA

Transmission Resource Whole price
E1 Transmission 4E1 19200/year
Hybrid IP Transmission 2ADSL 1E1 5760/year
Unit Price E1 4800/year, ADSL480/year Unit Price E1 4800/year, ADSL480/year Unit Price E1 4800/year, ADSL480/year

• 40-80 Transmission rental can be saved!

13
Optimized Migration Plan Go Broadband today with
HSDPA
Peak data rate HSDPA 700
Cost per MB HSDPA 35
HSDPA provides lower cost per bit, clearly
differentiate 3G from 2G services to the end user.
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Optimized Migration Plan Speed Up Introducing
Attractive 3G based Applications
TV Programs

• Example Mobile TV Huawei Cell Multimedia
  Broadcast (CMB)
• All users share a common channel (FACH)
• Fewer resources occupied but higher revenue for
  operators
• Low cost and good experience for end users
• Smooth evolution to MBMS
• CMB allows a pre-MBMS cost effective solution for
  Mobile TV and other broadcasts.

15
Optimized Migration Plan Cooperation with
suppliers for Affordable and Customized User
Terminals

• At this stage, it is strongly recommended that
  operators cooperate closely with terminals
  suppliers to provide affordable customized
  handsets.
• Huawei has focused on designing chipsets for
  Multi-platform solution to reduce the cost of low
  end terminals
• Cooperate closely with operators for customized
  handsets

U526
E620(HSDPA)
E618 customized for Vodafone
U626
U636
U526
E600
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About Huawei 3GGlobal UMTS Applications
Area Contract Reference
Europe 12

Asia Pacific 9

Middle East 7 Africa

• Achieved 28 UMTS commercial contracts by the end
  of April 2006
• Deployed over 50 pilot networks worldwide.
• 22 Market share of Total Awarded Contracts in
  2005.

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Global Footprint of Huawei CDMA
About Huawei 3GGlobal CDMA2000 Applications
Pakistan
Thailand
China
Bangladesh
Mexico
Nigeria
Yemen

• Over 40 M subscribers
• 19 CDMA2000 1xEV-DO commercial applications
• 15 CDMA SoftSwitch commercial applications
  serving 10 M subscribers
• over 65 global market share in CDMA450
• 68 global market share in CDMA WLL

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Conclusion

• The trend of telecom industry is evolving from
  Network Based to Customer and Services Based.
• Despite the competition between UMTS and CDMA2000
  as the two favorite 3G technologies, they do
  share a lot of similarities in their Capabilities
  and Roadmaps.
• Shared Core Networks for 2G and 3G whether
  Circuit core based on R4 softswitch or Packet
  core - is a major step towards a smooth
  migration, optimizing CAPEX and OPEX as well as
  improving QoS.
• A set of new advanced technologies in the 3G Node
  Bs considerably help the operators to reduce the
  TCO while improving the overall performance.
• Hybrid TDM/IP transmission is currently the
  favorite solution to balance the high speed data
  transmission requirements and the cost of
  transmission resources.
• Huawei strongly encourages operators to
  differentiate their 3G capabilities with
  innovative and attractive applications
  (especially with HSDPA mature availability), and
  to cooperate with handsets suppliers for
  affordable and customized user terminals.
• Huawei has achieved a remarkable global presence
  and leadership in the mobile industry, witnessed
  by the wide global applications of Huawei
  GSM/GPRS/EDGE/UMTS/CDMA2000 1x/DO networks.

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