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0249-EX-ML-2011 Text Documents

Nokia House

2012-01-03ELS_121897

White paper Mobile broadband with HSPA and LTE – capacity and cost aspects

The latest generation of smart devices and USB data modems for mobile computers has created explosive growth in network data traffic. In particular, mobile broadband via High Speed Packet Access (HSPA) has led to a significant rise in the Contents number of subscribers and the amount of data they use. The volume of data 3 Radio capacity of traffic carried by cellular networks has mobile broadband already exceeded that of voice traffic. 7 The cost of mobile However, managing the ongoing broadband capacity growth of data traffic is a significant challenge for communications 10 Summary service providers (CSPs) who need to undertake careful planning of the 11 Abbreviations network structure to achieve the performance that data services demand. This paper analyzes the maximum radio capacity of mobile broadband solutions from the viewpoint of traffic quality vs. traffic distribution over time and location. It suggests that user data rates can be improved by adding macro sites in hot spots, deploying six sector sites and implementing quality of service differentiation. Secondly, the paper gives a high level view of the cost of mobile broadband services, taking into consideration the volume of data traffic per user and the number of active data subscribers per site. The key finding is that monthly network Capital Expenditure (CAPEX) and Operational Expenditure (OPEX) can be kept below 3 EUR per subscriber over an eight-year depreciation period. This is true if the average mobile broadband penetration is at least 500 subscribers per site, and if subscribers use less than 2 GB per month. 2 Mobile broadband with HSPA and LTE – capacity and cost aspects

Radio capacity of mobile broadband This section uses typical traffic distribution assumptions from live Maximum capacity Traffic distribution Traffic distribution Usage networks to estimate the maximum per site from between base over 24 hour period per subscriber CQI values station sites per month network capacity with HSPA and Long Term Evolution (LTE). The intention is to derive an approximate value for the maximum number of subscribers that can be supported by a specific base Total network level capacity in Terabytes per month station site density with given spectrum resources. Figure 1 illustrates the estimation process. High Speed Downlink Packet Access Maximum number of subscribers (HSDPA) terminals send a Channel Quality Indication (CQI) to the base station every few milliseconds when Figure 1. Estimation of the maximum number of supported subscribers in the network they are sending or receiving data. The CQI indicates the maximum possible data rate that the terminal can receive with an error rate of less than 10%. % % 20 100 CQI reports are used mainly for link adaptation and for packet scheduling 18 Probability density 90 algorithms, but they can also be used 16 Cumulative density 80 to estimate the maximum air interface 14 70 capacity for network dimensioning. 12 60 Figure 2 shows an example CQI 10 50 distribution over the whole network. 8 40 For reference, CQI 15 corresponds to approximately 2.2 Mbps, CQI 20 to 6 30 4.9 Mbps and CQI 25 to 8.3 Mbps of 4 20 HSDPA throughput. These throughputs 2 10 assume that the cell is carrying only HSDPA traffic and no WCDMA 0 0 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 Release 99 traffic. The median CQI CQI value in Figure 2 is 21, which corresponds to 5.7 Mbps throughput. Figure 2. Example CQI distribution System level packet scheduling gains can increase cell throughput slightly, other-cell interference and by the so in this example we assume 6 Mbps performance of the terminal receivers. average cell throughput, which means For LTE, we assume 35 Mbps cell 6 Mbps per 5 MHz carrier per sector in throughput for 20 MHz bandwidth, HSPA. The CQI values are affected by which corresponds to 50% higher network planning, by the level of spectral efficiency than with HSPA. Mobile broadband with HSPA and LTE – capacity and cost aspects 3

A margin in network dimensioning in the busy hour needs to be reserved in order to guarantee low delays and reasonably good data rates. In this example, a maximum 50% loading of the CQI values over the busy hour is assumed, which leads to an average Share of traffic busy hour throughput of 6 Mbps x 50% = 3 Mbps per cell in HSPA and 17.5 Mbps per cell in LTE 20 MHz. The 50% margin is not constant but depends on the targeted user data rates and on the applications. 50% If background download applications are mainly being used, the busy hour loading could be more than 3 Mbps. 15% Share of cells Traffic is never equally distributed between sites. In a network, several Figure 3. Example traffic distribution between cells sites will provide coverage, but will not be fully loaded. Figure 3 illustrates an example traffic distribution during the busy hour in which 50% of the Share of daily traffic traffic is carried by 15% of the cells. 7% In estimating the maximum network capacity, this paper always assumes that it is those 15% of the cells that become congested and limit the total capacity. At the same time, 85% of cells are not congested. Network capacity could be improved by adding cell sites to the congested areas. The traffic distribution depends on the network deployment, country geography and number of users. 0:00 06:00 12:00 18:00 24:00 Typically, more users lead to a more equal traffic distribution Figure 4. Example traffic distribution over a 24-hour period between sites. Traffic is also not equally distributed over a 24 hour period. The busy hour in data networks is typically in the evening, but data traffic is also generated during the night. Figure 4 shows an example traffic distribution in which the busy hour carries 7% of the network’s daily traffic. 4 Mobile broadband with HSPA and LTE – capacity and cost aspects

Figure 5 shows typical European Spectrum Current Future spectrum resources. HSPA is deployed at 2100 and 900 while LTE is 2600 LTE 20 MHz used at 2600, 1800 and 800. The total (FDD 20 MHz) amount of spectrum is assumed to be 2 x 70 MHz paired spectrum per CSP. 2100 HSPA Multicarrier HSPA (15 MHz) Now, let’s make an example capacity 1800 calculation with 10,000 and 20,000 (15 MHz) GSM LTE 15 MHz base station sites, each with three sectors. Such a network would be 900 HSPA (5 MHz) + typical of a large European country. GSM (10 MHz) GSM (5 MHz) It is assumed that each subscriber consumes an average of 5 GB of data 800 LTE 10 MHz per month in the downlink and uplink (10 MHz) together, which is more than a typical user on an HSPA network today. Figure 5. Assumed spectrum resources The capacity is assumed to be downlink limited, while uplink use is assumed to be 30% of downlink use. This corresponds to 3.8 GB of part (1%) of the total traffic, but voice downlink data and 1.2 GB of uplink requires strict Quality of Service data. For reference, typical voice use assurance to provide low delay and is 300 minutes per month, which low error rate. corresponds to 36 MB of data in the downlink with 16 kbps equivalent data The maximum number of subscribers rate. Therefore, voice will be a minor is estimated by the following equation: Cell_capa[Mbps] 50%(maxload) 15% Subs = ‡ 3(sectors) ‡ 3600s/hour ‡ 30days/month ‡ Sites ‡ (distribution) 8192Mbit/GB ‡ 3.8GB/sub 7%(busy hour share) 50% Mobile broadband with HSPA and LTE – capacity and cost aspects 5

Figure 6 shows the results. With Millions of subscribers 10,000 sites, the radio network can 50 support up to 5 million data subscribers 45 with HSPA and up to 22 million data LTE subscribers with HSPA and LTE. 40 HSPA With 20,000 sites, the capacities 35 would be 10 million HSPA subscribers 30 and 45 million with HSPA and LTE. Typically, existing networks with 10,000 25 sites have of the order of 20 million 20 voice subscribers, while networks 15 with 20,000 sites have 40 million subscribers. These calculations 10 indicate that HSPA and LTE radio 5 networks with typical spectrum 0 allocation can provide 5 GB of data for 10000 sites 20000 sites all existing voice subscribers. Figure 6. Maximum number of broadband subscribers, each Another way to calculate capacity is to consuming 5 GB/month (using spectrum allocation from Figure 5) consider user data rates. Let’s aim for a minimum of 1 Mbps user data rate. A so-called overbooking factor can be used to take into account the fact that only a small proportion of users will typically be downloading data at the The following solutions can be • QoS differentiation can be same time. 3.8 GB of downlink data used to provide even more applied to control the priority of per month with 7% busy hour share capacity and to support more heavy users when they exceed corresponds to 20 kbps average data subscribers: their monthly quota. Typically, rate per subscriber during the busy • More macro sites could be a small percentage (less than hour, which is equal to an overbooking added to congested areas. 20%) of users takes most of the factor of 1 Mbps/20 kbps = 50. Nokia Siemens Networks Flexi capacity (more than 80%). base stations are compact, • Offloading traffic from the User expectations for data rates have zero-footprint and are fully macro network to small cells like depend on the market, as well as the deployable outdoors, which can micro or femtocells (home application and terminal being used. make site acquisition simpler NodeB/eNodeB). 3GPP Markets with high wireline broadband compared to conventional base Releases 8 and 9 include a penetration tend to have higher station designs. number of enhancements for expectations for mobile broadband • 6-sector sites offer typically femtocells, including optimized data rates, while users in markets with 40–50% more capacity per site architecture, as well as two-way poor wireline broadband availability compared to 3-sector sites and handovers between macro and may be happy with lower data rates. up to 80% in the best case. femtocells. 3GPP Release 10 Therefore, the dimensioning rules (Source: “All-in-one mobile site includes the work item need to be adapted to market solution boosts 2G, 3G and LTE “Heterogeneous networks”, that conditions. network coverage and capacity”, provides enhanced interworking Nokia Siemens Networks press between macro cells and small release, November 4, 2009). cells. 6 Mobile broadband with HSPA and LTE – capacity and cost aspects

The cost of mobile broadband capacity This section estimates the cost of • The annual OPEX ranges from mobile broadband capacity and uses 8,000 to 80,000 EUR per site, the following assumptions: depending on the configuration, • HSPA and LTE radios are including backhaul, site rental, considered with minimum power consumption and radio configuration of HSPA 1+1+1 (5 MHz) network software and hardware and maximum configuration of maintenance. The OPEX is clearly HSPA 4+4+4 @ 900 (5 MHz) and higher than CAPEX depreciation, 2100 (15 MHz), and LTE 3+3+3 @ and therefore, it is essential to 800 (10 MHz), 1800 (15 MHz) and minimize network OPEX. 2600 (20 MHz). • We assume that 100% of OPEX is • The network CAPEX ranges from allocated for data but, in practice, 40,000 to 400,000 EUR per site part of the OPEX could also be depending on the configuration. allocated to voice traffic because The minimum CAPEX corresponds the base station sites also provide to HSPA 1+1+1 configuration, while the voice network. This would make the maximum CAPEX corresponds the data cost lower than that shown to HSPA 4+4+4 and LTE 3+3+3 in the calculations in this paper. configurations. The CAPEX per site • Site configuration is selected is assumed to be linear with the site according to traffic requirements. capacity. Here, the same traffic distribution • CAPEX depreciation occurs over as in capacity calculations is 8 years. assumed, in which 15% of the cells carry 50% of the traffic. Mobile broadband with HSPA and LTE – capacity and cost aspects 7

Figure 7 shows the cost per subscriber EUR/sub/month as a function of subscriber density per 10 base station site. Figure 8 shows cost 10 GB/sub/month 9 per gigabyte as a function of mobile 5 GB/sub/month broadband penetration. 8 2 GB/sub/month 7 1 GB/sub/month Subscriber density is the average 6 value over the whole network. If the average number is, for example, 5 500 subscribers per site, there will be 4 sites in the network supporting 3 1,000–2,000 subscribers, while many sites will provide mainly coverage for a 2 few subscribers. Figure 8 assumes 1 that there are, on average, 2,000 voice 0 subscribers per site. 100 200 300 400 500 600 700 800 900 1000 Average subs per site The CAPEX + OPEX per subscriber are relatively high when the subscriber Figure 7. Network CAPEX + OPEX per sub per month density is low. The cost reduces when there are more subscribers sharing the costs. With at least 500 subscribers per site each using less than 2 GB/month, the monthly CAPEX EUR/GB 10 + OPEX will be below 3 EUR per subscriber. If the average data usage 9 10 GB/sub/month can be kept less than 2 GB and the 5 GB/sub/month 8 subscriber density is very high, it is 2 GB/sub/month 7 1 GB/sub/month possible to push the monthly CAPEX + OPEX below 2 EUR. If the site 6 rental and backhaul costs are partly 5 allocated to voice, then the monthly 4 CAPEX + OPEX for broadband data will be even lower. 3 2 The cost of delivering a GB of data is 1 highly dependent on the network utilization. If total data use is high, 0 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% either due to a high number of Penetration of mobile broadband subscription subscribers or to high use per subscriber, the cost per GB can be Figure 8. Network CAPEX + OPEX per gigabyte of data below 1 EUR. Figure 8 shows that a cost of less than 1 EUR can be obtained with 40% mobile broadband penetration and 2 GB/sub/month. 8 Mobile broadband with HSPA and LTE – capacity and cost aspects

A few notes on the cost calculations: • LTE with new spectrum allocations • The most important factor in the is efficient for carrying higher cost calculations is network OPEX traffic volumes. The benefit of LTE because it is typically higher than becomes clear when HSPA CAPEX. The largest contributors to spectrum has already been fully OPEX are backhaul transport, site utilized and further HSPA capacity rental, network maintenance and would require new and costly base electricity. Other OPEX factors, like station sites. customer acquisition and • Sufficiently high LTE terminal marketing, are not considered here. penetration is needed to offload • It is essential to minimize OPEX by traffic from HSPA to LTE. If LTE using efficient Ethernet transport, terminal penetration is low, it may for example Ethernet based be more cost effective to upgrade microwave radio, fiber or DSL, the capacity of the existing HSPA and by re-using existing base network than to deploy an LTE station sites. network. • The mobile broadband cost • Small femtocells can provide a depends on how the site and significant capacity offload from transport costs are shared between the macro network, if marketed to voice and broadband data. users with appropriate use patterns. • The relationship between cost and Macro cell traffic can also be traffic per subscriber is not linear. offloaded to WLAN (WiFi) networks. If the traffic per subscriber grows ten-fold, the cost will increase only two- to three-fold. This is because the radio networks must always provide basic coverage even in low traffic areas. When the traffic increases, the low traffic areas do not need capacity upgrades. Furthermore, many cost elements in the high traffic areas remain similar or grow only moderately with traffic volumes. Such costs include site rental and backhauling costs. In other words, high data penetration and high data usage leads to lower cost per GB. Therefore, CSPs with a large market share will benefit from economies of scale. Mobile broadband with HSPA and LTE – capacity and cost aspects 9

Summary The advent of smart devices and mobile computers has generated explosive growth of data traffic that It is possible to provide up to challenges CSPs to make well-timed 5 GB of data per month for and focused investments. This paper shows that, with typical European every existing voice subscriber spectrum resources, it is possible to by using HSPA and LTE radios provide up to 5 GB of data per month for every existing voice subscriber by in existing sites. using HSPA and LTE radios in existing sites. Radio capacity can be boosted further by deploying additional macrosites in hot spots, using 6-sector configurations, applying QoS differentiation, and by using micro- and femtocells in highly populated areas. The cost of delivering a gigabyte of This study provides an essential data per subscriber can be less than lesson: Increasing the subscriber base Monthly network CAPEX + OPEX can 1 EUR if total data use is high enough. is vital for CSPs to achieve lower data be kept below 3 EUR per subscriber LTE networks can lower the cost per delivery costs. This is because radio over an eight-year depreciation period bit, especially when HSPA spectrum networks benefit from significant if average mobile broadband is fully utilized, because adding LTE economies of scale, with high data penetration is at least 500 subscribers capability to existing sites costs much penetration and high data use leading per site, and if data use is below less than adding new HSPA sites. to lower cost per GB. 2 GB per subscriber per month. However, for this to be viable, 500 subscribers correspond typically sufficient LTE terminal penetration is The continued growth in smart device to 25% mobile broadband penetration. needed to drive traffic onto the LTE and mobile computer data traffic is It is essential to re-use existing base network. creating a major disruption in the station sites, and to deploy efficient telecommunications industry that will Ethernet transport solutions using require CSPs to accurately plan the microwave radio or fiber. timing and focus of their network investments. Monthly network CAPEX + OPEX can be kept below 3 EUR per subscriber over an eight-year depreciation period if average mobile broadband penetration is at least 500 subscribers per site, and if data use is below 2 GB per subscriber per month. 10 Mobile broadband with HSPA and LTE – capacity and cost aspects

Abbreviations 3GPP Third Generation Partnership Project CAPEX Capital Expenditure CQI Channel Quality Indication CSP Communications Service Provider DSL Digital Subscriber Line CQI Channel Quality Information GB Gigabyte HSDPA High Speed Downlink Packet Access HSPA High Speed Packet Access LTE Long Term Evolution OPEX Operational Expenditure QoS Quality of Service WCDMA Wideband Code Division Multiple Access WLAN Wireless Local Area Network Mobile broadband with HSPA and LTE – capacity and cost aspects 11

Nokia Siemens Networks Corporation P.O. Box 1 FI-02022 NOKIA SIEMENS NETWORKS Finland Visiting address: Karaportti 3, ESPOO, Finland Switchboard +358 71 400 4000 Product code C401-00558-WP-201004-1-EN Indivisual Copyright © 2010 Nokia Siemens Networks. All rights reserved. A license is hereby granted to download and print a copy of this document for personal use only. No other license to any other intellectual property rights is granted herein. Unless expressly permitted herein, reproduction, transfer, distribution or storage of part or all of the contents in any form without the prior written permission of Nokia Siemens Networks is prohibited. The content of this document is provided “AS IS”, without warranties of any kind with regards its accuracy or reliability, and specifically excluding all implied warranties, for example of merchantability, fitness for purpose, title and non-infringement. In no event shall Nokia Siemens Networks be liable for any special, indirect or consequential damages, or any damages whatsoever resulting form loss of use, data or profits, arising out of or in connection with the use of the document. Nokia Siemens Networks reserves the right to revise the document or withdraw it at any time without prior notice. Nokia is a registered trademark of Nokia Corporation, Siemens is a registered trademark of Siemens AG. The wave logo is a trademark of Nokia Siemens Networks Oy. Other company and product names mentioned in this document may be trademarks of their respective owners, and they are mentioned for identification purposes only. www.nokiasiemensnetworks.com


Document Created: 2010-04-26 14:20:26
Document Modified: 2010-04-26 14:20:26
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