|Issue:||Latin America 2007|
|Topic:||Fuelling wireless growth in Latin America|
|Title:||Vice President Global Marketing & Communications|
|Organisation:||Radio Frequency Systems, RFS|
Jörg Springer is Vice President Global Marketing & Communications with the wireless technology group Radio Frequency Systems, RFS. Mr Springer has over 15 years of experience in global marketing and business development. He has held executive positions in Mercosul, North America and Europe, such as Director of Product Line Communications with a multinational European OEM and Head of Business Development with a Brazilian group based in Rio de Janeiro. Mr Springer is the Publisher of the quarterly wireless industry journal STAY CONNECTED, and is a member of the German Association of Journalists. Mr Springer holds a Masterís degree in Business Administration (MBA).
Wireless is growing rapidly in Latin America. Cell phone subscribers, for example, have grown 57 per cent in 12 months in Peru and 42 per cent in Argentina. The latest technologies are just one of the many factors pushing this growth; a varied mix of important criteria must be satisfied before new technologies and platforms benefit business and consumers. Functionality and performance, appropriate spectrum allocation processes and a streamlined approach to new product innovation are all essential ingredients.
There is no doubt that Latin America is experiencing huge demand for wireless services. Rarely has the region seen this level of demand from business and consumers alike. To satisfy the demand, access to affordable technical solutions is imperative. Where this has occurred, growth has followed. A clear case-in-point is the current boom in the use of cell phones in the region. Subscriber numbers in Peru, for example, have grown by 57 per cent in 12 months, and in Argentina the figure was 42 per cent. The first installations of third-generation, 3G, services are now in operation, and more are planned. In Brazil, the take-up of mobile services began to grow rapidly from 2003 and 2004. Pre-paid services were introduced, prices dropped and cell phones immediately became more popular. Around 80 per cent of subscribers today utilise the pre-paid option. Brazilís population is the fifth largest in the world and there are now approximately 100 million mobile subscribers. Many homes in Brazil no longer have fixed lines. Moving indoors While outdoor wireless usage has long been evident, we are seeing a greater need for indoor coverage. Installations at shopping centres and hotels typically include RF, radio frequency, distribution systems incorporating radiating cable, distributed antenna networks, or a combination of the two. More complex sites require more sophisticated designs. These could include a hybrid mix of active fibre-optic technology and passive RF distribution networks that will support next-generation wireless services. Wireless local area networks, WLAN, and accompanying broadband Internet connections are often used for this purpose. In the short term, businesses are most likely to emulate such designs but, in Latin America, where broadband penetration is not high, a similar approach has potential for domestic installations. In the highly populated cities, provision of wireless broadband in high-rise apartments using in-building WLAN solutions holds great promise. Another area of growing interest to consumers is the delivery of digital broadcast television and radio services. Most Latin American countries are opting for European or US standards. The Brazilian Government, however, has chosen the Japanese Integrated Services Digital Broadcasting, ISDB, standard for digital terrestrial television. This also supports delivery of TV services to vehicles and handheld or portable devices, such as cell phones and laptop computers. In Brazil, the transition to HDTV services will begin in late 2007, with the incumbent analogue TV system operating in parallel until 2016. Common elements The developments in mobile technology, television, radio and wireless broadband are all positive. However, their introduction has only come about as a result of a rich mix of important criteria being satisfied. Functionality and performance, appropriate spectrum allocation processes and a streamlined approach to new product innovation are essential ingredients for the acceptance of any new technologies. In such a highly populated region, space for infrastructure is at a premium and, if we consider the mobile example, new RF infrastructure needs to become highly integrated and lightweight, enabling optimum use of base station sites. These RF solutions are being developed in an era where competition and the pace of R&D have reduced the life cycles of such products considerably. The risks to return on R&D investment have become more significant than ever. A streamlined approach to new product innovation is emerging, as carriers and OEMs grapple with the issues of introducing appropriate and competitive products to the market. Supporting infrastructure In an environment where new networks are commonly overlays rather than greenfield deployments, reducing weight at the tower top is a core objective, for reasons of both cost and space. Those who own and maintain the actual infrastructure feel the impact. Every kilogram counts – transmission lines, antennas, RF conditioning components and brackets all contribute. More component weight leads to heavier towers and more welding, bracketing, bracing and supporting. It is not only the material cost that is important. Extra weight can mean the difference between two installers on the tower versus one, affecting CAPEX, capital expense, at the installation stage, and OPEX, operating expense, during maintenance. There are also the costs of logistics and transport to consider. These can be the hidden costs of any rollout strategy, and consignment weight and bulk are the biggest factors in determining the bottom line on logistics. The good news is that lightweight solutions are available at reasonable cost, and this has fostered growth in wireless services in Latin America. Improvements in materials technology and electronics are both contributing. Lighter antennas, cables and towers have had a direct impact, while more sophisticated electronics at the tower top have allowed the sharing of space and equipment. From a functionality perspective, we are also seeing the integration of active and intelligent elements with the passive. This has spawned a range of important next-generation base-station antenna systems. These include compact cluster assemblies combining multi-band passive and active RF elements, a wide range of so-called ësmart antennasí, the much lauded multiple-input/multiple-output, MIMO, solutions, and even fibre-to-the-tower-top antenna systems such as remote radio head, RRH. Spectrum shift While the component design aspects are important, availability of spectrum is fundamental to the introduction of new wireless services. Further 3G and WiMAX, Worldwide Interoperability for Microwave Access, spectrum auctions are expected in the region this year. Fortunately for all stakeholders, the signs in Latin America, and around the world, are that the industry has matured, and learnt from the damaging round of auctions in Europe at the turn of the century. A clear indicator of this maturing is the 2006 Advanced Wireless Services, AWS, auction in the USA. When comparing dollars-per-megahertz-per-head of population, US$/MHz/POP, average prices were an order of magnitude less than when similar auctions were held in the USA, UK and Germany in 2000 and 2001. We are witnessing a more stable environment, with new entrants exhibiting strategic and well-founded business plans. Underpinning the new strategies is a mounting confidence in the viability of evolving technologies and applications. Mobile TVís potential is proven, and WiMAX and High-Speed Packet Access, HSPA, are becoming better understood. Carriers are seeking to deliver ëquadruple playí, bundling voice, TV, high-speed Internet and wireless service into an irresistible package that is likely to stimulate industry growth. Squeezing R&D In addition to spectrum availability, the industry must also deal with the issue of turning R&D into timely product releases. The wireless world is now moving faster than ever before into next-generation technologies. The shorter transition periods from 2G to 2.5G, and then 2.5 to 3G, are clear indicators of this acceleration. Today, we are seeing the earliest trials and commercial deployments of 3.5 and 4G platforms, such as WiMAX, HSPA ëultra mobile broadbandí, UMB, and 3G ëlong-term evolutioní, LTE. This is creating unprecedented demand for advanced RF solutions that are tailored to the specific needs of carriers and OEMs. An ever-increasing rate of technological change has made ëtime-to-marketí one of the wireless worldís core business objectives. This is also coupled with an increasing demand for complex, broad-based platform approaches that support the widest range of spectral and technology variants. While there is a trend towards outsourcing R&D, the strategy is not without risk. An alternative approach is to develop and retain the skills in-house and offer R&D as a value-add. This provides transparent and straightforward access to world-class engineering resources. There is continuing need for new product innovation, NPI. We take the view that a commitment to R&D and NPI is in the best interests of the whole RF industry. Allowing external organisations access to this engineering expertise is in contrast to traditional R&D models, but all stakeholders, including consumers, benefit from the more efficient use of resources. The technological developments in mobile communication, digital broadcast and wireless broadband all have the potential to bring about improvements for the industry, the economy and, most importantly, for individuals in the region. However, it is not simply a matter of relying on new technology. Functionality and performance, mature spectrum allocation processes and a streamlined approach to new product innovation are essential ingredients for the acceptance of any new technologies and wireless services. With these elements in place, the growth of wireless in Latin America looks set to continue.