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inherent@hotmail.com wrote on 5/17/01 12:46:33 AM
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DoCoMo's capacity problems can't be compared with anyone else's, because
DoCoMo is using a uniquely Japanese network technology: PDC - GSM. You
really can't draw conclusions from DoCoMo's deployment schedule about what
other operators might need. Plus, Japanese tariffs are much higher than
those in Europe, which keeps traffic artificially low relative to Europe for
a given penetration.
GPRS and EDGE, of course, do nothing for capacity. EDGE, moreover, isn't
going to be deployed by any serious operator in Europe, except perhaps Blu
in Italy and Bouygues in France (who failed to get 3G licences, although
Bouygues may yet get one). Why deploy EDGE (available H2 2002) when you can
deploy UMTS (available H2 2002)? Don't forget, if you pay a few bilions for
the licence, that gives you a huge incentive to get the network up and
running as soon as possible, to start earning a return on your payments.
That's quite apart from deployment conditions in the licences. You can't
just sit on them - you hav to build out to certain levels by certain dates.
Effectively GPRS and EDGE do not add capacity. EDGE, however, enables the operator to make better use of the spectrum, as it is 3 times more efficient that GPRS. This efficiency translates into capacity gains that can be used to increase the available bit rate to the end user or simply the number of active users into the system. This is true for EGPRS. EDGE Phase 2 includes voice capacity enhancements.
Now, EDGE is not meant to substitute UMTS. In the European case, EDGE could be deployed in two instances: to enable early availability of so-called 3G services, or to complement WCDMA roll-out. The first case, to a large extent loses its legitimacy due to the delayed availability of the infrastructure, handsets included. The second, although still a compelling case, may not apply on a collective basis. That is, market particularities will also dictate the viability of the EDGE case. Licence terms is one example. But deploying a combined WCDMA/EDGE network, provided the handsets exist, may be more cost-efficient that a purely WCDMA network.
Now, while not having a 3G licence is an instance to deploy EDGE, it is not necessarily a reason to do so, particularly when MVNO' are so much in vogue. These operators could also seek to partner with a 3G licensee, new entrant for example, to capitalise on the economies of scope of the combined subscriber base.
The spending on 3G licences is an incentive to have the networks up and running. True. But this does not necessarily mean that operators would seek to deploy as fast as possible to gain as much penetration as possible. The more intensive the roll-out of the network, the longer the payback period. The more intensive the roll-out, the more pressing the subscriber transition becomes, because of the related costs, such as handset subsidies - particularly in markets with high mobile penetration. Also need to consider the effect on the commercial case of the existing networks, namely GPRS.
Operators will certainly have to comply with licence terms. But look at Germany, who's considering allowing network sharing, for example. This changes the terms of the bidding process. If those that failed to get a licence had known they could consider network sharing as a roll-out strategy would have they gotten a licence? Is it fair to change the terms after the fact? Those licence terms, were in any way tainted by the UMTS hype? Look at Spain, too. They were supposed to have the network commercially operational by August 2001. Now it is 2002, if I'm not mistaken…wishful thinking.
My point being: there's nothing written on stone. It is not entirely obvious that because the licences were expensive, deployment and market penetration should be accomplished by any means. There's more to the issue, precisely because of the amount of money already spent. Also think that while some things may be true or false, on a collective basis, some variances will always exist because of market differences.
- Antonella.
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Received on Thu May 17 20:34:05 2001