Jarich: What my crystal ball is telling me for 2010

Peter JarichIt's mid-January, and while many other pundits released their telecom predictions for 2010 at the end of 2009, I was too busy gorging myself on peppermint bark and mulled wine to find the time. That doesn't mean, however, that I haven't been thinking about what the New Year will mean for wireless networks. If you promise not to hold me to any of these predictions, I'd be happy to share them.

WiMAX slowdown. With LTE hype (and deployments) ramping, it's easy to lose sight of the success WiMAX has achieved--500+ deployments in nearly 150 countries, per the WiMAX Forum. It is clear, however, that original hopes of WiMAX being a mobile broadband competitor to LTE haven't materialized. In 2010, then, this means that progress on 802.16m standardization and commercialization will likely stall and operators like UQ, Yota and Clearwire will remain exceptions--rather than the rule. It also means vendors that remain in the WiMAX space will play up the value in the developing world and roll out continuing innovation to keep those markets happy.

LTE disappoints. LTE services have already gone commercial in Norway and Sweden. Verizon spent CES demonstrating cool LTE applications. It's clear that 2010 will be a big year for LTE. That said, past experience argues that early launches will be plagued with glitches and performance that doesn't match early promises--along with weak device portfolios. Combined with the need to support multiple technologies and bands in a single device, the result will be lots of launches, learning and progress that should set up 2011 as a year for real user traction.

Spotlight on TD-LTE. By all accounts, TD-LTE hasn't gotten major operator interest outside of China Mobile. This should change in 2010. With vendors pledging their support (if only in an attempt to woo business from the world's biggest cellco) the technology looks to enjoy much greater support than TD-SCDMA ever will... with compelling devices and network products someday flowing from common TDD and FDD LTE R&D. TD-LTE won't approach the interest garnered by its FDD sibling, but interest will grow, especially as WiMAX operators plan their network evolutions.

Femtos ramp, finally. Since 2006, analysts have been predicting the next year to be a breakthrough year for femtocell services. Revisiting that prediction for 2010 makes sense. Launches in Europe, the U.S. and Asia set the stage for growth. Commercial availability of capabilities by year-end suggest investment protection and solutions (finally) in-line with operator demands. A focus on applications gives operators a way to drive uptake beyond simple coverage and capacity. Operator struggles with crowded 3G networks suggest the need for femtos is greater than ever.

2G/3G evolutions = more of the same. Alongside the focus on LTE, 2009 was supposed to a major year for 2G and 3G evolutions like HSPA+, EV-DO rev. B and Evolved EDGE. Largely, it wasn't; Evolved EDGE got little operator interest and EV-DO rev. B got no more than a handful of trials. There's little reason to believe that 2010 will be any different, despite the recent launch of EV-DO rev. B in Indonesia. The sole exception has been HSPA+, a technology with more than 65 network commitments per the GSA as of December... and a technology that should keep widespread LTE momentum in Europe at bay until 2011.

Network renewals. With LTE on the horizon and a new generation of multi-standard base stations, vendors have been selling the value of "network renewals" for a few years. The idea is simple: 3G and LTE evolutions provide an opportunity for operators to replace old, inefficient radio access gear with new base stations that deliver clear OpEx benefits based on the convergence of multiple networks. Progress on LTE commercialization will move this forward. So too will considerations around the lifespan of 2G (longer than expected).

EPC battleground. 2009 was a big year for the mobile packet core. Cisco acquired Starent. Tellabs acquired WiChorus. Ericsson launched its EPC solution based on the SmartEdge platform. Alcatel-Lucent announced its EPC platform based on its successful 7750 platform. With deals just closing and products just getting to market this year, it's clear that 2010 will be the year for EPC and packet core posturing to turn into real packet core competition.

Voice vs. LTE. 2010 will not be the year in which Voice over LTE strategies are solidified. It will not be a year for delivering clarity on the best way to deliver voice over the proto-4G technology. Long before the GSMA rolled out its One Voice Initiative, it was understood that IMS was the preferred long-term LTE voice solution. In the near-term, it's been assumed that circuit-switch fallback (CS Fallback--IE, voice over 2G or 3G) will fill the role. With no demonstrations to date, it's clear that CS Fallback isn't likely to meet all operator demands, giving VoLGA and other interim solutions a chance to squeeze in.

Application focus. "Applications" and "monetization" were mobile network watchwords for most of 2009. Why? No operator wants to see their shiny new 3G or LTE network reduced to being a dumb pipe--especially with device makers like Apple showing how much money this leaves on the table. Yet, for all the talk of how vendors can help operators monetize their assets and squeeze more money from their customers (potentially linked with fair-use policies), the commercial results have been limited. As LTE actually gets deployed and networks get more crowded, this should change in 2010.

Peter Jarich is an analyst with Current Analysis.

Sponsored by SNS Telecom

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