An Ignoble Experiment

2. Huawei repositioning as a 'European' company

Sprint (NYSE: S) will need to roll out an additional 30,000-40,000 transmission sites if the carrier wants its 2.5 GHz TD-LTE network to reach coverage parity with its 1.9 GHz networks, according to the head of American Tower.

Taiclet

On a conference call with investment analysts to discuss American Tower's first-quarter 2014 results, Jim Taiclet, company chairman, president and CEO, touched on the tower footprint of Sprint, one of American Tower's tenants, and offered a "theoretical construct" regarding what it will take for Sprint to match its 1.9 GHz coverage with its 2.5 GHz spectrum, which has much weaker propagation characteristics.

Sprint is rolling out TD-LTE on the 2.5 GHz spectrum it acquired last year from Clearwire simultaneously with deployment of its original Network Vision multi-mode base station network project, which upgrades its CDMA service at 1.9 GHz and adds LTE at 800 MHz and 1.9 GHz. Last summer, Sprint said it would also deploy Clearwire's 2.5 GHz spectrum on all 38,000 of its planned Network Vision cell sites in a nationwide rollout. By mid-2014, Sprint expects to begin overlaying 2.5 GHz access on its existing network as new 8T8R radios become available. The overlay will be key to Sprint Spark, the carrier's tri-band 800 MHz/1900 MHz/2.5 GHz LTE service.

During Sprint's second-quarter 2013 earnings call, Steve Elfman, who was then the carrier's president of network operations but has since announced plans to leave the company, acknowledged that due to the weaker propagation characteristics of the 2.5 GHz spectrum, Sprint will likely have to deploy small cells and other sites beyond the 38,000 Network Vision sites the company has mapped out. But he did not say how many more sites would be needed.

According to a Seeking Alpha transcript of American Tower's most recent earnings call, Taiclet said American Tower is "estimating that in addition to 38,000 Network Vision sites that are kind of on the docket with Sprint, they probably need another 30,000 or 40,000 transmission locations ultimately to have 2.5 coverage match the 1.9 network at the end of the day," he said. "So, it should be a long-term, as I said, multiyear project to get that signal out there," Taiclet added.

In response to a question from an analyst, Taiclet said his numbers are theoretical and do not necessarily represent Sprint's specific plans. "Not sure Sprint is ever going to go that far, but if they wanted to, that's the order of magnitude that might take," he added.

"The 2.5 GHz deployment will last for a number of years and really ramp up probably more next year," Taiclet noted.

Taiclet's envisioned site numbers for Sprint are higher than estimates made in August 2013 by New Street Research analyst Jonathan Chaplin, who wrote in a research note that he expects Sprint's total cell site count to increase to somewhere between 50,000 and 60,000 sites, more than offsetting disconnects of old Clearwire sites. That increase could lead to incremental revenue growth for American Tower, Crown Castle and SBA Communications, the three major U.S. tower companies, he wrote.

Taiclet also said American Tower expects to see more growth opportunities from voice over LTE (VoLTE), the rollout of FirstNet's nationwide public-safety broadband network (NPSBN), multicasting and machine-to-machine services.

He said VoLTE, which both AT&T Mobility (NYSE: T) and Verizon Wireless (NYSE: VZ intend to launch this year, will require greater cell site density than that required to support classic circuit switch voice calls. "It's our belief that in order to roll out VoLTE effectively carriers will both eventually need to increase the density of their networks by up to 20 percent to 30 percent over time," Taiclet said.

He noted the NPSBN being planned by the First Responders Network Authority (FirstNet) should provide American Tower with incremental revenue opportunities in the latter half of the decade, regardless of whether a dedicated network is deployed or existing carriers deploy additional spectrum for FirstNet's use.

For more:
- see this Seeking Alpha transcript and webcast
- see this American Tower release

Read more about: cell site, TD-LTE, 2.5 GHz
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By Tammy Parker

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3. BridgeWave, E-Band cited as major millimeter-wave players despite upheavals

Huawei has decided the best way to shed its image as an enigmatic Chinese company is to boost its European presence through investments and hiring.

Ren Zhengfei

CEO Ren Zhengfei told journalists in London that his own personal shyness has made the company seem furtive. "My reluctance to meet with the media has been used as a reason to label Huawei as a mysterious company," Ren said through a translator, according to The Wall Street Journal.

In addition to increased media outreach, Ren said Huawei's mission is to ensure that in a few years, "people perceive Huawei as a European company."

Huawei expects to boost European R&D investment, according to Ren. In January, the company announced that it spent $3.4 billion (€2.4 billion) with European suppliers in 2013. During October 2013, Huawei said it was investing $200 million (€148 million) in a new R&D center in the UK as part of a wider $2 billion investment in the country. The vendor is also participating in the METIS 2020 project, which aims to position Europe as a 5G leader.

Huawei is also working closely with European academia. The vendor announced last month that it was launching the "Telecom Sees for the Future" program with two Danish universities, The Technical University of Denmark and The University of Aalborg. Huawei is also helping support development of a 5G Innovation Center at the University of Surrey in Guildford, England.

In addition, the company is extending an employee incentive plan to all key non-Chinese employees this year.

Huawei's European campaign may already be paying off. In March, the European Commission backed off its threat to launch an investigation into alleged dumping by Chinese mobile equipment manufacturers, with the European Union's (EU) executive body saying it needs more time to determine if an investigation into illegal subsidies is required.

However, the vendor is still essentially shut out of the U.S. infrastructure market over concerns the Chinese government would use Huawei equipment to spy on Americans. Huawei has denied those allegations and continues to pursue deal with small and rural telecom operators.

Ren also said he expects it may take 10 or 20 years for Huawei to be fully accepted in the United States as "a company with integrity." He added: "We may have opportunities then."

According to Reuters, Ren said he was not surprised by media reports in March that said the U.S. National Security Agency (NSA) had spied on his company.

Ren also said Huawei has no plans for an initial public offering anytime soon. "Shareholders are greedy and they want to squeeze every bit out of the company as soon as possible," he said.

Huawei's employee-owned structure, in which the vendor's 150,000 employees are shareholders, is "part of the reason Huawei could catch up and overtake some of our peers in our industry," Ren said, explaining that making employees into owners "creates a very strong drive to boost the development of the company."

For more:
- see this Wall Street Journal article (sub. req.)
- see this Reuters article

Read more about: networks
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By Tammy Parker

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4. Qualcomm says 3GPP is studying beacon technology for indoor positioning

Two companies cited by a new research report as "major players" in the millimeter-wave market have undergone major restructuring in the past year. MarketsandMarkets cited both BridgeWave Communications and E-Band Communications in a report on millimeter-wave components, but both vendors gained new owners within the past year after apparently facing financial struggles due in part to the small cell backhaul business taking off more slowly than expected.

BridgeWave was quietly acquired in late 2013 by Remec Broadband Wireless, which has manufactured its radios since August 2008. According to a document filed with the FCC on Dec. 6, 2013, by Radio Physics Solutions, all BridgeWave production had at that time been outsourced to Remec for manufacturing in the Philippines, and BridgeWave had released the majority of its U.S.-based support staff.

Though neither BridgeWave's nor Remec's website made any announcement regarding an acquisition transaction, a Remec job posting that was placed in February 2014 on LinkedIN stated, "Remec Broadband Wireless acquired BridgeWave Communications in December 2013."

Wireless industry consultant David Theodore also reported on his blog in March 2014 that BridgeWave was acquired the previous December by Remec. A source told FierceWirelessTech that Remec was owed a considerable amount of money by BridgeWave prior to the takeover.

Last year, Moseley Associates of Santa Barbara, Calif., announced it was acquiring--for an undisclosed amount--the assets, intellectual property rights and key employees of E-Band, which launched in 2003.

Radio Physics Solutions noted in its FCC filing, which urged the commission to provide more rules guidelines for companies wanting to use spectrum above 95 GHz, that E-Band was essentially "liquidated through asset sale to Mosely."

E-Band made a splash in 2010 when it became a key backhaul infrastructure supplier for Clearwire's WiMAX network. However, Clearwire's subsequent shift to TD-LTE, which caused the carrier to stop building out the WiMAX network, negatively impacted many of its suppliers, including E-Band.

Both BridgeWave and E-Band also pursued the small cell market, whose reality has so far fallen short of early expectations. Stephane Teral, principal analyst for research firm Infonetics Research, recently noted: "The great small cell ramp did not happen in 2013 as many in the industry had hoped. Testing activity remained solid, but actual deployments were modest."

Nonetheless, MarketsandMarkets cites BridgeWave and E-Band as two "major players" in its new report on millimeter-wave components. The research firm predicts the total market for millimeter-wave components will reach $1.9 billion by 2020, representing a compound annual growth rate (CAGR) of 45 percent from 2014 to 2020. In addition, volumes are estimated to grow from 22,000 units to 691,000 thousand units during the period.

The majority of applications involving millimeter waves used frequencies between 20 GHz and 120 GHz during 2013, MarketsandMarkets said. Aside from mobile and telecommunication products, other millimeter-wave applications include scanning and imaging as well as radar and satellite communications.

MarketsandMarkets also predicts the small cell backhaul market will grow from $587.5 million in 2014 to $2.08 billion in 2019, at a CAGR of 28.8 percent during the forecast period.

In related news, Agilent Technologies just announced enhancements for its MXA and EXA X-Series signal analyzers, one of which directly targets millimeter-wave use in telecom. An option for its MXA allows engineers to measure millimeter-wave signals and up to terahertz without having to buy a separate high-end analyzer.

The company said this capability is essential for accurate signal analysis as carrier frequencies shift toward millimeter wave and higher in modern applications, such as backhaul connections for wireless communications.

"Engineers are facing a number of challenges as they begin working in millimeter-wave and higher frequencies, including more accurately identifying and measuring weak or previously unknown signals, as well as achieving a higher level of frequency stability," said Jim Curran, marketing manager for Agilent's microwave and communications division.

For more:
- see this MarketsandMarkets release and this release
- see this blog entry
- see this Agilent release

Read more about: millimeter wave, Remec, small cell
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By Tammy Parker

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5. AT&T's open-source nanocube for data analytics wins accolade

Qualcomm (NASDAQ:QCOM) is working with the U.S. Department of Commerce and others on a proposed 3GPP study to explore ways to improve indoor location accuracy through the use of beacon technology.

Qualcomm reported the research in an ex parte letter to the FCC, in which the company said it would be premature for the commission to a change to its E911 accuracy rules in a way that might compel the use of any technology that is not yet "fully developed, rigorously tested, and proven."

On Feb. 20, 2014, the FCC announced it is considering proposed changes to its E911 rules to include indoor location accuracy--particularly location accuracy in challenging indoor environments such as large multi-story buildings where first responders are often unable to determine the floor or even the building where the 911 call originated.

In its filing, submitted by John Kuzin, senior director, government affairs-regulatory, at Qualcomm, the chipmaker said the 3^rd Generation Partnership Project (3GPP) study item with which it is involved is examining the use of terrestrial beacon systems (TBS) as a complement to other location methods to enhance existing positioning capability indoors and in other challenging locations.

According to a 3GPP work item description, TBS consist of a network of terrestrial beacons broadcasting signals for positioning purposes. They may use dedicated, unshared spectrum or spectrum shared with other users, including FDD and TDD licensed spectrum.

"This ongoing technical research and development is not triggered by any commission proposal, but rather reflects the industry's ongoing focus on the ability of new air interfaces, most notably LTE, and existing air interfaces not currently used for E911, such as Wi-Fi and Bluetooth, to deliver more accurate position location information," said the filing.

The filing cautioned: "New position location technologies require extensive R&D, testing in multiple diverse environments and refinement before they can be fully integrated into carriers' networks and deployed ubiquitously, as is necessary for E911."

"On-going enhancements to the US FCC Enhanced 911 capability are focusing on in-building positioning and will require augmented capabilities that are not currently available in 3GPP," noted the project.

The Find Me 911 Coalition, which was initially funded by vendor TruePosition, is pushing the FCC to mandate use of more accurate location technologies--with terrestrial beacon transmitters on the list of possibilities--to help public-safety answering points (PSAPs) locate 911 callers if they are calling for help from inside a skyscraper.

Qualcomm is a pioneer in the use of beacon technology and recently announced it is spinning off the unit that houses its Gimbal geolocation beacon business into a separate company. A group of third-party investors has established Qualcomm Retail Solutions, an existing subsidiary of Qualcomm, as an independent, standalone company.

For more:
- see this Qualcomm filing

Read more about: E911, indoor location
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By Tammy Parker

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