1. Prin. L. N. Welingkar Institute of
Management Development and
Research, Bangalore
Report on
“TD-LTE and India”
By
Kaushik Maitra (PGDM eBusiness-I)
and
Rohit Singh (PGDM eBusiness-II)
Reviewed by
Prof. Shriram Kothapalli
TD-LTE and India | 1
2. Introduction
Ours is a country where people are obsessed with mileage, good food, and not to mention,
also ultra-low call rates. 3G was launched in India in late 2008 by MTNL in Delhi and within
one year a lot of hype was created, especially on the internet, about 3G. This resulted in the
entry of quite a number of players in the 3G market within the next two years. They were
providing a plethora of services, which were heard about before but remained unseen, e.g.,
video calling, mobile broadband, live TV, etc. Since, India still could not banish License Raj
even after 17 years of commencement of economic reforms, the prospective players were
asked to pay a heavy price, which was eventually passed to the end-consumer to bear. Thus,
the reception of 3G was rather reluctant.
The 4th generation telephony services were introduced in India by Airtel (in Kolkata) in April
earlier this year. About two years before the launch, another license was auctioned – the
BWA spectrum license. Only one player got the pan-India license – HFCL Infotel. Within
hours after the conclusion of the aution, Reliance Industries Limited, the conglomerate
spearheaded by Mukesh Ambani, bought 95% stake in HFCL Infotel, and thus, a new
company, Reliance Infotel, was formed. Airtel, Aircel, Augere, Tikona and Qualcomm also
won 4G licenses. But another fundamental error was made in the process – auctioning of the
band of 2300 MHz instead of the 1800 MHz band. In most parts of the world, the frequency
bands of 700 MHz, 1800 MHz and 2600 MHz are in use.
What is 4G-LTE?
LTE is the initialism of Long Term Evolution or 4G LTE, is a standard
for wireless communication of high-speed data for mobile phones and data terminals. It is
based on the GSM/EDGE and UMTS/HSPA network technologies, increasing the capacity
and speed using a different radio interface together with core network improvements. The
world's first publicly available LTE service was launched by TeliaSonera in
Oslo and Stockholm on 14 December 2009. LTE is the natural upgrade path for carriers with
GSM/UMTS networks, but even CDMA holdouts such as Verizon Wireless, who launched
the first large-scale LTE network in North America in 2010.
Although marketed as a 4G wireless service, LTE as specified in the 3GPP Release 8 and 9
document series does not satisfy the technical requirements the 3GPP consortium has adopted
for its new standard generation, and which were originally set forth by the ITU-
R organization in its IMT-Advanced specification. However due to marketing pressures and
the significant advancements that WIMAX, HSPA+ and LTE bring to the original 3G
technologies, ITU later decided that LTE together with the aforementioned technologies can
be called 4G technologies. The LTE Advanced standard formally satisfies the ITU-
R requirements to be considered IMT-Advanced and to differentiate LTE-
Advanced and WiMax-Advanced from current 4G technologies, ITU has defined them as
"True 4G".
TD-LTE and India | 2
3. LTE has two variants – TDD-LTE and FDD-LTE. TDD and FDD stand for time division
duplexing and frequency division duplexing, respectively. Following is a brief comparison
between the two: -
Parameters TDD-LTE FDD-LTE
Definition The communication is done The communication is
using one frequency, but the done using two frequencies
time for transmitting and and the transmitting and
receiving is different. This receiving of data is
method emulates full duplex simultaneous.
communication using a half
duplex link.
Frequencies Communication happens Two frequencies are used
only on one frequency, but simultaneously, one for
the time of sending and transmitting and the other for
receiving are different. receiving.
Interferences More Less
Frame Structure Different subframes are used Every downlink subframe
for downlink and uplink. can be associated with uplink
subframe.
Spectrum Efficiency Low High
Table 1: LTE-TDD vs LTE-FDD
Deployment of 4G-LTE
Despite the huge success of HSPA, LTE is the fastest developing mobile communications
system ever. The primary drive towards LTE by operators comes from the need for network
capacity, performance management and efficiency. Deploying LTE is critical to maintain the
user experience of mobile broadband, and for business growth. LTE enables operators to
support future mobile data demand and is essential to address the mass market and achieve
the potential of a fully connected world. GSA’s Evolution to LTE report (October 1, 2012)
confirmed 351 operators are investing in LTE, 41% more than a year ago. 105 operators have
launched commercial LTE networks in 48 countries. Another 194 network deployments are
in progress. 52 additional operators in 11 more countries are at a pre-commitment stage,
engaged in technology trials, tests or studies, etc. GSA forecasts that 159 networks will be
commercially launched in 68 countries by end 2012. This figure should rise to at least 195
live networks in 72 countries by end 2013. The ecosystem of LTE user devices is rapidly
developing; over 400 products confirmed by GSA on July 3, 2012.
TD-LTE and India | 3
4. Fig. 1 – Growth of LTE around the world
Focus On TD-LTE
11 operators have launched commercial service using the TDD mode in unpaired spectrum,
which is also part of the LTE standard, with 16 more commercial network deployments in
progress, and several more operators engaged in trials and studies. The LTE TDD mode is the
perfect choice for providing high speed mobile broadband access in unpaired spectrum. The
largest contiguous bands are at 2.3 GHz (100 MHz) and within the 2.6 GHz band (50 MHz)
and these are the main bands for LTE TDD deployments in most regions. LTE TDD and
FDD are complementary and may help with international roaming as some devices will
support both LTE FDD and TDD. While some operators in Latin America and the Caribbean
have already commercially launched LTE services, many more are preparing for its
introduction in the coming weeks and months.
With the support from Asian telecom operators including China Mobile, Softbank, Bharti
Airtel, Reliance Infotel, as well as major equipment and chipset vendors such as Huawei,
Samsung, ZTE and Qualcomm, TD-LTE addressable market should reach 40% of the global
population (~ 2.5 bn people) in next five year and its subscriber base will touch 70.7 million
by 2016.
Substantial Scope of BWA in SME Segment
According to a survey conducted by Google, less than two million of SMEs are online. Of the
800 SMEs surveyed by Google, 57% used internet as a sales channel to grow their business.
Around 70 percent of them use internet for vendor and supplier search and 40% use internet
TD-LTE and India | 4
5. to advertise online. Currently the segment is largely unpenetrated. BWA has a substantial
potential to tap into this segment.
There are around 27 million SMEs geographically dispersed across India. Moreover, most
ofthese SMEs are located outside of Metros in Tier II cities and rural areas. With the lack of
leased line infrastructure in these areas, BWA has a substantial potential to provide
connectivity in a cost effective and timely manner. Moreover, the leased line operators might
not find it feasible to provide services to SMEs that are both geographically disbursed and
present in remote areas.
Fig. - SME Geographic Distribution in India
Source : United Nations Industrial Development Organization, March 2012
Table 2: Forecast of TD-LTE Network Deployment
Operator 2012 2013 2014
Reliance Infotel 5,000 15,000 20,000
Bharti Airtel 2000 3000 5,000
Others (Aircel, Tikona, Augere) 500 3000 5,000
TD-LTE and India | 5
6. Table 3: TD-LTE Market Opportunity
Country Operator Current Launch Total Tota Penetration TD-LTE
Plan Addressable Subs by 2016 Subscribers
Population (mn) (mn) (mn)
China China Phase 1&2 in 1340 800 7% 56
Mobile 2012, nationwide
by 2013
India Reliance Trial in 2012, 1200 10
Infotel nationwide
launch in 2013
India Bharti 4 cities in 2012 237 (in 4 circles) 200 1% 2.0
Airtel
Japan Softbank launch in Q1 125 30 5% 1.5
2012, nationwide
2012
Saudi Saudi 2012 60 24 5% 1.2
Arabia TeleCom
Total 40 % of Global 2725 70.7
Population
TD-LTE saw rapid evolution, strong international support, and increasing maturity of the
ecosystem. The following timeline (Fig. 2) below explains how TD-LTE achieved this feat: -
Fig. 2: Evolution of LTE-TDD
TD-LTE and India | 6
7. Impact of LTE in India
There could be three main reasons for operators to adopt TD- LTE technologies:
The availability of TDD spectrum
The cheaper licence fees for TDD spectrum compared with FDD spectrum, and
Indian operators’ (Reliance Infotel, Airtel, Tikona Digital) commitment to supporting the
development of the TD-LTE ecosystem.
Following is the operator-wise analysis of the telecom environment that will be evolved by
2016, that is, after the launch of 4G-TD-LTE: -
1. Reliance Infotel
The expectation from Reliance Infotel is that the 3-5 year growth story will be driven by the
BWA business. The 4G technology which is TD-LTE is currently in the very early stages of
evolution of the ecosystem handsets/devices, network infrastructure, etc. During that time,
development of the ecosystem, infrastructure rollout and subsequent off-take will be seen.
Reliance may undertake some city (possibly a metro) deployment similar to Airtel. The full
impact of this will likely be felt on the market only over 3 years.
It is also expected that the immediate impact of BWA in 2013 will be felt on the data
business in limited cities (Possibly top 10 cities). Dongles and hotspots are likely to adapt
quickly. Tablets are expected to follow next. The handset environment is likely to however
take longer. Neither the technology nor the development and off-take of handsets are in a
stage where this will threaten the incumbent GSM/ CDMA and WCDMA business from a 2-
year perspective.
In an analyst meeting on July 12 2010, Reliance Infotel highlighted the following points:
1. It will invest Rs. 48 bn (US$ 1.1bn) over the next 2-3 years to launch wireless
broadband services and does not intend to enter the already crowded 2G-based
telecom business. However, the company mentioned that it may enter the voice
business through IP enabled voice (like VoIP).
2. Management said the roll-out of services will be made in phases and will initially
target urban and semi-urban centres.
3. RIL expects the BWA (Broadband Wireless Access) service to achieve cash profit
in three years from launch time
4. As per RIL, a pan-India BWA rollout would require 15,000 towers and the
company plans to partner with existing infrastructure providers for most of its
rollout requirements.
TD-LTE and India | 7
8. Fig. 3: RILs 4G Deployment Status and Plans
2. Bharti Airtel
India is still in early days of its 2.1GHz 3G launch – there are fewer than 15mn 3G subs by
December 2011. Undoubtedly, take-up rates will pick up as coverage/ ecosystem evolves and
as perception and pricing of data improves; but the key battle will be the insufficient 5 MHz
of 3G spectrum, which will keep a lid on data penetration rates.
Table 4 : 3G Uptake in India
Bharti Idea RCOM
3G Active Subs (000's) 2400 2250 2800
% of total Wireless Subs 1.4% 2.1% 1.9%
Average 3G usage MB per Month 235 230 220
3G ARPU increments 79 75 72
3G as percentage of Data /Vas Revenues 3% 8% 7%
3G as percentage of wireless Revenues .5% 1.1% 1.3%
3G as percentage of wireless data revenues # 29% 31% 14%
Number of 3G BTS deployed for 3G 16000 9000 10000
During the Broadband Wireless Access (BWA) auctions last year, six bidders won this
spectrum in select circles, with Reliance Industries (RIL) the only company winning 20MHz
in all circles. Other existing operators to win this spectrum include Bharti in four circles and
Aircel in eight circles. This could further restrict/ delay the rollout as initial focus by Bharti
and Aircel will more likely be on 3G services, where the operators have recently signed the
roaming agreements.
TD-LTE and India | 8
9. Table 5 : Segment Wise Data Adoption potential based on technology 2G/3G/4G
Segment Dominant Remarks
Technology
Leased line - Amongst large corporates, BWA will have a limited
Large Corporates impact.
- Option of Leased lines or wireline, enhanced QoS and
Speed.
SMEs BWA ( 4G) - BWA has the potential to expand presence in the SME
segment, 3G would be the dominant technology in the
high-end retail market before penetrating the corporate
and SME segments. On the other hand, 2G is expected
to continue to have a significant presence in the low-end
retail segment.
Affluent Retail 3G followed - the immediate impact of BWA in 2013 will be felt on
by 4G the data business. Dongles and hotspots are likely to
adapt quickly. Tablet devices will follow next. The
handset environment is likely to however take longer.
- Neither the technology nor the development and off-
take of handsets are in a stage where this will threaten
the incumbent GSM/ CDMA 2G business from a 2-year
perspective.
Mass Retail 2G Followed - Price Sensitive
by 3G
Wireless 4G followed - 4G will be prefered if ubiquitous network is available.
Dongle/Pocket by 3G or Ev-
Router DO
4G Deployment Status
Airtel has BWA spectrum in four circles, and there are good reasons to consider that Airtel
can acquire Qualcomm’s BWA spectrum in further four circles. Airtel is well placed to
capture BWA offtake over the next 3 years, to hold off the threat from RIL’s growth and
would benefit if regulations shift to favour BWA operators versus incumbents. Airtel has
selected this BWA suppliers and deployment in some cities are underway. Airtel has
launched TD-LTE service in Kolkata on April 10,2012. Approximately 500 enodeB were
used in Kolkata for the commercial launch. The coverage is mostly in pockets and
approximately 250 kilometers of urban area is covered during initial launch. Airtel has
created many experience zones for users to test TD-LTE as compared to 3G. Bharti will
launch 4G serivce in Bangalore and Pune during next quarter.
TD-LTE and India | 9
11. 3. Aircel
Aircel was initially inclined toward using BWA spectrum for WiMax rollout given that it
provided WiMax solutions (even before auctions on unregistered spectrum); but with
improving visibility of the LTE ecosystem it is now focusing on LTE rollout. It is believed
that Aircel’s strategy will be similar to that of Airtel — use LTE to complement its existing
3G business by focusing on tablets and/or dongles on LTE, and using LTE as a backbone to
transfer the traffic load.
4. Tikona
Tikona is providing wireless broadband (largest outdoor 4G WiFi network, 42,000 base
stations) using 83 MHz (2.400 to 2.483 GHz) in the unlicensed band in 36 top cities, and its
product offerings are targeted towards enterprise consumers and household customers. In
August 2010, the company secured LTE licences in five circles covering about 29% of the
urban population of India. Tikona management believes LTE will help Tikona provide
―outdoor ubiquitous coverage for mobile internet devices‖ to complement its existing indoor
high capacity–high speed WiFi offerings for Home & SMB and expand its reach further now
to target mobile broadband subs (―small-screen‖).
Following are challenges for Tikona;
Their Wi-Fi based access network has many challenges in keeping good network quality
and greater indoor penetration due to inherent lack of Wi-Fi technology in dealing with
a) Large interference issues due to deployment in free band
b) Limited allowed radiated power to penetrate deep inside buildings
c) Maintaining QoS
d) Operational challenges.
Tikona subscriber base is not growing aggressively ( less than 200,000 subscribers ) to
maintain health cash flow and attract new funding
Lack of project funding support from equipment suppliers to build large TD-LTE
network as the operators’ credit rating is not encouraging.
Future Prospects
LTE Advanced is the upgraded version of LTE. It can deliver speeds upto 1 Gbps, that is, 10
times more than LTE. On 9th October, 2012, the first LTE-A network in the world was
commercially launched by a Russian network operator, Yota. It can be expected that within
the 6-8 years, LTE-A will be launched in India. LTE-A boasts the capability to even wipe out
technologies like FTTH/FTTP and DSL.
TD-LTE and India | 11
12. Conclusion
India is a fast-growing economy. The per capita income is increasing and so is the GDP.
More and more people are being exposed to new opportunities. 3G is indeed in a very early
stage but it is growing quite fast in India. Bharti Airtel is providing a plethora of 4G services
on the new 4G phone that it has launched recently in Kolkata. Reliance Infotel will launch
ultra-low cost 4G tablets and phones once it kickstarts it LTE services in India. Today, the
number of 4G subscribers is very few compared to 4G’s predecessors but it is expected to
grow even faster than 3G and even 2G in the coming years.
References
www.gsacom.com
www.itu.int
www.trai.gov.in
www.ndtv.com
www.timesofindia.com
www.telecomtalk.info
www.wikipedia.org
www.3gpp.org
TD-LTE and India | 12
