Nortel sells off CDMA, LTE Businesses to Nokia Siemens Networks
By Lynnette Luna
Nortel Networks may not be emerging from bankruptcy. The company announced it is selling off virtually all of its CDMA and Long Term Evolution (LTE) evolution assets through a "stalking horse" asset sale agreement with Nokia Siemens Networks. Nokia is getting its hands on the valuable businesses for a steal: $650 million.
This appears to be the first of many fire sales as Nortel announced it is in discussions with external parties to sell its other businesses. Nortel said it will assess other restructuring alternatives for these businesses in the event it is unable to maximize value through sales. In addition, Nortel will apply to delist its common shares and the NNL preferred shares from trading on the Toronto Stock Exchange (TSX) and expects that the creditor protection proceedings will ultimately result in the cancellation of these equity interests.
NSN is getting its hands on a CDMA business that is the second largest in the world and an LTE business that has strong potential. Nortel said Verizon Wireless was happy with its gear but was concerned about Nortel's bankruptcy. NSN has no CDMA networks business.
The agreement with NSN specifies that at least 2,500 employees would have the opportunity to continue with NSN. This represents a significant portion of the employees associated with the assets being sold. [FierceWireless]
China's Leaders Cite Global Financial Crisis as Reason for Moving on 3G Licenses
By Lynnette Luna
Could China become the savior for the mobile infrastructure industry? Spending among operators is down, and the financials of major infrastructure players like Alcatel Lucent and Nortel are terrible. But new reports indicated the Chinese government is expected to issue long-awaited licenses for 3G services by the beginning of 2009 with the expectation that it will generate $29.1 billion in investments from the three operators.
Industry players, no doubt, have kept their fingers crossed as rumors that the licenses would be awarded continually surfaced with no action over the years. Now Li Yizhong, minister for industry and information technology, said the licensing decision was a "very significant" response to the global financial crisis.
Market leader China Mobile will be granted a licenses for China's homegrown standard, TD-SCDMA, while China Unicom will receive a license for W-CDMA technology. China Telecom, which doesn't operate a network, will be granted a license for CDMA2000 technology. [FierceBroadbandWireless]
Availability of Combo Chipsets Will Drive Mass Market Integration of GPS in GSM Handsets from 2009
GPS semiconductor vendors are increasingly focusing on GSM handsets as their next target market for GPS chipsets. While until now CDMA handsets and navigation devices have been the main GPS product categories, GSM mobile phones are expected to increasingly feature GPS-chipsets as handset-based navigation and a wide range of location based services such as local search and social networking become popular.
GPS already has become a standard feature on smartphones, with recently launched products from Nokia, Sony Ericsson, Palm and Samsung and the iconic iPhone, expected to become important drivers for LBS uptake due to their large screens and text input facilities.
“Despite its appeal, the handset form factor poses a series of new challenges to GPS chipset vendors”, says ABI Research director Dominique Bonte.” While minimal power consumption, price, and small footprint are even more important in handsets than in PNDs, the bigger issue is related to indoor coverage, as handset-based LBS services will be frequently used in urban canyons and indoor environments such as shopping malls where GPS reception is impaired.”
The very important trend of “combo” chipsets – integrating different radio technologies such as FM, Bluetooth, Wi-Fi and GPS on a single chip – promises to provide a solution to power, footprint, and price challenges, while also allowing integration of alternative positioning technologies such as Wi-Fi to provide better indoor coverage and a seamless positioning experience to the end user. This is evidenced by the recent announcement of Broadcom’s partnership with Skyhook Wireless.
The expected availability of combo chipsets in 2009 from major GPS chipset vendors such as Broadcom, Atheros, NXP, and Texas Instruments will play an important role in accelerating the adoption of GPS in mass market handsets, ultimately making it a standard handset feature. [ABI Research]
CDMA Is Not Dead Yet
Although the overall dynamics of CDMA markets are overshadowed by the hype around UMTS/HSPA and the migration to LTE, CDMA operators continue to upgrade their networks to provide capacity for higher numbers of bandwidth-intensive data services, as well as escalating traffic load.
“Worldwide EVDO Rev A subscriber numbers ramped up more than eightfold between Q2 2007 and Q2 2008,” says ABI Research analyst Khor Hwai Lin. “The US and South Korean markets shows the highest growth rate for EVDO Rev A. The increased support for LTE from incumbent CDMA operators does not imply the imminent death of EVDO Rev A and B, because LTE is addressing different market needs compared to 3G.”
EVDO Rev A subscribers are forecast to exceed 54 million by 2013 while Rev B subscribers will also increase, to 25 million.
More than 31 million subscribers worldwide are already using HSDPA while 3.2 million subscribers were on HSUPA networks by Q2 2008. Upgrades to HSUPA continue to take place aggressively around Western Europe and the Asia-Pacific region. Hence, HSUPA subscribers are estimated to reach around 139 million in number by 2013.
“HSPA+ will contest with LTE and mobile WiMAX in the mobile broadband space,” adds Asia-Pacific vice president Jake Saunders. The 100Mbps download data rate difference between LTE (20MHz) and HSPA+ may not attract mid-tier operators to migrate, as LTE is based on OFDM technology that requires new components, while a move to HSPA+ is perceived to be more gradual transition.”
Due to the large number of GSM 900 subscribers worldwide and the high possibility of refarming the spectrum for UMTS, ABI Research estimates that the majority of these subscribers worldwide (about 1.2 billion by 2013) will be on a 900MHz-only band.
In second place would be dual-band users on 900MHz and 1800MHz (one billion by 2013). 2100MHz subscriber numbers are forecast to ramp up steadily with a CAGR of 23.5% between 2007 and 2013. [ABI Research]
China Telecom Will Spend $4B on CDMA Expansion
By Sue Marek
As part of its restructuring, Chinese operator China Telecom will assume control of China Unicom's CDMA network and spend $4 billion to expand the network into rural areas rather than improving capacity or quality of service in existing markets.
The news is certainly promising for CDMA infrastructure vendors such as Alcatel-Lucent. The company has been struggling with economic turmoil in the market, tight credit and stiff competition from vendors such as Huawei.
China announced its telecom restructuring plans earlier this year and said that it would reduce its number of state-owned carriers to three. [FierceWireless]
MetroPCS Will Flash Existing CDMA Handsets
Consumers Can Now Activate Their Existing CDMA Handsets on MetroPCS' Network, Offering the Freedom to Enjoy the Nation's Most Affordable and Flexible Wireless Service
MetroPCS Communications, Inc., the nation's leading provider of unlimited, flat-rate wireless communications service, announces the launch of MetroFlash, allowing consumers to bring their compatible CDMA handsets to be used on MetroPCS' network. Coupled with its low cost, flat-rate unlimited wireless service, MetroPCS is further broadening consumers' freedom to enjoy more cost efficient, flexible wireless options. MetroFlash will eliminate for many consumers the requirement of having to purchase a new handset when signing up for MetroPCS service.
"Offering consumers the ability to join MetroPCS with their existing handset makes switching carriers easier - and more cost efficient - than ever," said Tom Keys, Chief Operating Officer of MetroPCS. "Not since number portability have consumers been offered such a convenient option in switching service providers. With the rising cost of gas and food, consumers are looking for ways to reduce expenses and the launch of MetroFlash, along with our flat-rate, unlimited low cost service plans, makes MetroPCS a more affordable wireless option."
Customers using MetroFlash will receive a free month of service, plus unlimited local, long distance, voicemail and text messaging for $40 a month and pay a $30 fee. The service will be available at all MetroPCS company owned stores and select authorized dealers in all MetroPCS markets, excluding Las Vegas and Shreveport/Bossier City. Consumers can go to MetroPCS or a MetroPCS company owned store to determine if their phone is compatible with MetroFlash.
MetroPCS' unlimited, flat-rate wireless, no signed contract plans range from $30 to $50 per month and allow subscribers to talk all they want, 24-hours-a-day, seven days a week. Unlike most carriers, MetroPCS does not require a signed contract, which means that consumers can activate service without going through a credit check or paying a deposit. Many of the plans include unlimited features such as voicemail, caller ID, call waiting, three-way calling, text and picture messaging, push e-mail, mobile Internet browsing, mobile instant messaging, and Metro411, a voice-activated, premium directory assistance service. Additionally, MetroPCS offers unlimited family plans for an affordable low price.
With approximately 4.4 million subscribers nationwide, continued consumer demand for MetroPCS' affordable, flexible, predictable, unlimited, no signed contract, flat-rate wireless service has been the driving factor behind the company's expansion across the country.
Consumers can visit any of MetroPCS' authorized dealer locations and company-owned retail locations or visit MetroPCS' web site here to sign up for service plans, and choose from a lineup of wireless phones from the top handset manufacturers. /PR/FierceWireless
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