Softbank to launch Asia’s first TD-LTE network

OVUM VIEW

Summary

In February 2012, Japanese mobile operator Softbank Mobile (Softbank) will launch a TD-LTE network for data offload. This means that Japan will be the first market in Asia to deploy a commercial TD-LTE network. Softbank – Japan’s third largest mobile operator – has been forced to deploy TD-LTE services because its UMTS network is under considerable strain in key areas.

TDD spectrum is now extremely valuable to mobile operators. Chinese vendor Huawei predicts that 70% of TDD networks will be deployed as extension networks by FDD operators. According to the Global Mobile Suppliers Association, four operators have already launched commercial TD-LTE networks globally: Brazilian operator Sky, Poland’s Aero2, and Saudi Arabian operators Etisalat and STC. The device ecosystem is quickly maturing, and Huawei is due to deliver LTE smartphones to Softbank later in 2012.

Softbank’s TD-LTE network to reach 92% of the population by 2013

Softbank has ambitious goals for TD-LTE in Japan. The operator’s Wireless City Planning unit, which already operates a personal handy-phone system (PHS), is aiming to cover 92% of the Japanese population with its Advanced eXtended Global Platform (AXGP), “100% TDD compatible” network by March 2013. Softbank is rolling out Huawei’s single RAN LTE-TDD solution in Tokyo, Osaka, Nagoya, and surrounding areas. The base stations for the network will be co-located with existing PHS sites, which will reduce costs and enable a rapid network deployment. The network, which soft launched in November 2011 in Tokyo, Osaka, and Fukuoka, is due to go live in February 2012 using a 20MHz channel, and is designed to offload 80% of the UMTS network’s data traffic.

Softbank’s mobile data focus is on smartphones, which is in contrast to rival eMobile’s focus on data cards. Softbank already offers the world’s first TDD-FDD LTE dongles, with LTE smartphones earmarked to launch in 2012. The Android smartphones from Huawei will support HSPA at 900MHz and 2100MHz, Dual-Cell HSPA at 1500MHz, and GSM/EDGE at 900MHz, 1800MHz, and 1900MHz.

Softbank is keen to shift data traffic from its UMTS network to its TD-LTE network. This is a logical move given that 40MHz of the 700MHz/900MHz spectrum for FDD LTE is not due to be allocated by the Japanese government until 1Q12. TD-LTE will help Softbank to manage network congestion, and improve quality of service. However, NTT DoCoMo, which launched its FDD LTE service in December 2010, still holds a network advantage over Softbank and CDMA operator KDDI.

TDD spectrum is now hot property

TDD spectrum is now extremely valuable to mobile operators. This is largely due to the China Mobile-led efforts to harmonize both variants of LTE. As a result of these efforts, every device will support both TDD and FDD LTE in the near future.

Mobile operators should have TDD spectrum in reserve for future data requirements. In light of this, Ovum expects Hong Kong’s upcoming TDD auction of 3×30MHz blocks of spectrum in the 2.3GHz band to attract significant attention from buyers. This increased attention from buyers highlights how much has changed in the past two years as Hong Kong’s first TDD spectrum auction of the 2.3GHz band in January 2009 failed to attract any bidders. The TD-LTE ecosystem was too immature then, but today it has developed considerably to become a key part of many operators’ strategies. When China Mobile launches its TD-LTE network in 2013, the device ecosystem will receive a further boost. In India, TD-LTE is also due to become a commercial proposition later this year.

WiMAX operators holding TDD spectrum without the money to upgrade their networks to TD-LTE could become future acquisition targets for FDD operators.

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