While LTE is the future in telecommunications, in light of the negative business case around 2.3/2.6Ghz deployments, the Indian roadmap looks a little less promising then it should be.

1. LTE: Charting the future
The Operational and the Deployment
challenges

2. What is LTE?
LTE is Wireless broadband technology to support Internet (and eventually
voice as well). LTE offers significant improvements over current prevalent
cellular communication standards and hence is sometimes referred to as
4G (fourth generation) technology
What is LTE? What will LTE imply?
•Standard for wireless communication • Converging point for both CDMA and
of high-speed data for mobile phones GSM
and data terminals developed by the
• Improved data speeds (>5X over 3G)
3GPP
•All-IP network – inherently based on • Deliver enhanced video and
Internet protocols multimedia for a better overall
•Not technically 4G yet, LTE as specified experience
in the 3GPP Release 8, 9 document • Improved Spectrum efficiency (data
series does not satisfy the requirements carrying capacity per bandwidth)
of ITU-R for 4G
• Eventually, reduce data costs and
voice costs
• Support for multiple bands via multi-
band chipsets and devices
• Provides a global ecosystem of devices
and network equipment

3. LTE: Implications
Subscriber Operator
• High-speed content sharing • High Spectrum Efficiency -
with significantly improved more capacity, less opex
throughput
• Smoother multimedia cost/MB (assuming high
interactions for applications like utilization)
video conferencing, gaming, • Co-existence and
through reduced latency convergence of other standards
• Improved mobility and low
interference, with better signal • Co-existence eventually of
characteristics multiple frequency bands
• Enhanced security for highly • Ability to leverage advanced
sensitive data access applications – video calling,
• Simplified roaming with telepresence, etc
operators world-wide migrating
to common standard

4. LTE: The Convergence of technologies
WCDMA Path
HSPA+
HSPA- LTE
WCDMA HSDPA LTE Rel
HSUPA Advanced
8/9
Marketed by most carriers
as 4G, but technically not
4G
2000 2002 2007-09 2009-11 2012…
CDMA2000 Path
CDMA20 EVDO LTE Rel LTE
1X EVDO
00 1X Rev.A/B 8/9 Advanced
Technology Shift
1After"freezing", a Release can have no additional functions added. However, detailed specifications may not yet be complete
2LTE Rel. 8 with peak data rate of 300Mbps in downlink and peak spectral efficiency of 3.75 bps/Hz in uplink doesn’t meet the IMT-Advanced
requirements for 4G technology (Peak data rate: 1Gbps, peak spectrum efficiency 6.75 bps/Hz in uplink)
UMB/ EV-DO Rev. C discontinued by Qualcomm in November 2008
Source: CDMA development group; Lit. search

5. LTE- Data Thru-puts
4G improves customer experience… but average experience likely below “claims”

6. Relative likelihood of using specific activities on a 3G/LTE network
(Data users)
Degree of Basic 3G activities
impact of 4G 2
5
over 3G/EVDO
%
Note: Likelihood of usage values based on general population Significant difference Marginal difference
Source: Bain Wireless Consumer Survey – April 2010 (n=3429)
LTE will impact experience most profoundly for video applications, current user set more concerned about e-
mail, social networking and basic activities
For most common current uses of internet (web searches, simple e-mail, etc) LTE will have only marginal
experience difference

7. LTE Telco Opex
Dense Urban Urban Rural Key Assumptions
• This is a theoretical exercise and represented as an ideal case
• Utilization of BTS has been assumed to be 100%
Not to scale • For EVDO Rev A, # carriers on a BTS =2; EVDO Rev B = 3; costs have been allocated
proportionately
• LTE throughput has been taken as 30 Mbps

8. Global LTE Deployments
9 commercial LTE TDD systems
Countries with LTE TDD commercial networks launched
Countries with LTE TDD studies, trials, deployments

9. LTE: Penetration
LTE expected to reach subscriber traction only by 2015 in developed countries, emerging
economies to be in nascence
“In the case of LTE, although the
initial boom is in developed
markets, there will be a loud echo
afterward as operators in
developing markets start upgrading
from 3G.”
Developed
countries
Analyst, Heavy Reading, Sep 2011
“LTE will be deployed in developed
markets first, with wide-scale
deployments in emerging
markets expected after costs for
equipment & handsets begin to
decrease. Although potential for
Developing
countries
LTE in emerging markets in the
next 5 years is limited.”
Pyramid Research, July 2011
Countries with LTE roll out begun and commercial service available in some regions
Countries with LTE spectrum auctioned but LTE deployments not yet commercial
Countries with planned LTE commercial deployments but spectrum not yet auctioned
Countries with LTE trial systems (pre-commitment)
Source: Wireless Intelligence; Lit. search

10. LTE & 3G – The US Case
Even in the US, 3G subscription expected to maintain healthy growth through 2015
Source: Kagan, Network Coverage & Subscriber Unit Projections (Dec 2010); Gartner,
Forecast: Mobile Devices, Worldwide (4Q09, 4Q10)

11. Global data traffic break-up
LTE TO HAVE 2.4X & 44X DATA USAGE PER USER OPERATORS EXPECT LTE TO HAVE SIGNIFICANT
COMPARED TO WCDMA AND GSM RESP. SHARE OF DATA TRAFFIC
“SK Telecom predicts that around 65%
of its total data traffic will be handled
by its LTE network by 2014, and it
expects to have 10 million LTE users by
2015.”
Unwired Insight, Nov 2011
“The average smartphone user on their
(Teliasonera) network consumed
375MB/month of data. The average
broadband user on their network, largely
3G data cards, consumed 5 GB/month.
But the average LTE consumer
(essentially all data cards) used 14 GB –
15GB/month of data.”
Gigaom, Nov 2010
*GSM, WCDMA, HSPA & LTE together expected to comprise ~90% share of all technology subscriptions by 2015; **1 EB=10^18 bytes
Note: GSM share of data traffic is low because a GSM subscriber would mainly utilize a basic phone for access and thus would
not exceed 60 MB data traffic per subscriber per month, even in 2015
Source: Ovum, Jan 2011; Gartner, Jun 2011; Bain analysis; Lit. search

12. Global LTE deployments
2300 TDD LTE spectrums to gain traction only by
Currently, most devices support FDD
2016
TDD
FDD
“Most commercial/trial FDD LTE networks deploy the 2.6GHz band, but
there are still a few rollouts including a couple of large ones using other
bands (such as 700MHz, 800MHz and 2GHz) while for TDD LTE, *Forecast calculated using average of estimates by HR and Ovum
2.3GHz and 2.6GHz are expected to be the two major bands for global Source: Global Opportunities for LTE TDD, Ovum, Feb 2011; White
TDD LTE rollouts.” Paper, Heavy Reading, March 2011; Bain Analysis; Informa
Goldman Sachs, June 2011 Telecoms

13. LTE economics in India

14. LTE in India- Limited scope in near
future
City Sub density Attractiveness
Mumbai 4505 Profitable
Delhi 5689 Profitable
Bangalore 2760 Profitable
Chennai 1825 Profitable
Hyderabad 2190 Profitable
Kolkata 1678 Profitable
Pune 1968 Profitable
Ahmadabad 1103 Profitable
Surat 1292 Unprofitable
Coimbatore 1962 Profitable
11-50 1111 17 out of 40 cities profitable
51 -150* 366 7 out of 74 cities profitable
Economics suggest that a rational roll out would be limited to select cities over next 3-5
years
Profitability is function of subscriber density and data usage characteristics
* Data not available for 26 cities
Source: Lit searches, Client materials; Bain analysis

15. LTE in India- Building scale
• Staggered launch schedule across 33
cities will limit LTE share of data
traffic in the next 2 years to within 5-
10%
• LTE on 2300MHz will require high
density of BTS to offer sufficient
coverage
– LTE on 2300MHz has limited
coverage with lower wall
penetration
• Customers unlikely to perceive high
value in LTE vs 3G
• Other LTE spectrum holders like
Aircel, Infotel not likely to launch
immediately
Economics of 2300Mhz could strain LTE • BSNL, Qualcomm looking to give
business case in short-medium term away their spectrum slot

16. LTE in India- The operational challenge
• Economics of 2300Mhz could strain LTE business case in short-
medium term
• LTE on 2300MHz will require high density of BTS to offer sufficient
coverage
– LTE on 2300MHz has limited coverage with lower wall
penetration
• 2300MHz LTS solution – unlikely to benefit from a scale ecosystem
as this will be among few 2300 MHz
• LTE coverage likely to be pocketed, with fallback on 3G
– User Experience is limited because of nomadic coverage through mix of
LTE/3G
• Voice services not expected or planned for. Internationally voice
services (VOLTE) over LTE have not been developed fully

17. LTE Deployments: India
• LTE deployments will in
• Focus target segments:
India will target heavy users
– Enterprises
and early adopters
– SMEs (SME dense
• Pricing per MB basis for clusters)
heavy users at parity to 3G – High-end/professional
or even lower residential areas
• To offset nomadic coverage, • Will try to uptrade, switch
heavy users and early
4G solution will partly be an adopters  cream the
indoor fixed Wi-Fi type 3G/EVDO data market
solution (via CPE
equipment/ IBS)

18. India LTE Deployments – Possible
Roadmap
• 700 MHz Digital Dividend – key to
economically sustainable deployments
– Low CAPEX can trigger faster penetration
– Larger eco-system support
– Greater carpet area  enhance broadband
penetration outside metros

19. Thank You