CDG predicts CDMA2000 operators among first to deploy LTE and mobile WiMAX to complement 3G networks

The CDMA Development Group (CDG) today announced that CDMA operators will be among the first to complement their 3G networks with wider bandwidth OFDM-based technology solutions, such as Long Term Evolution (LTE) and Mobile WiMAX, as the 3G CDMA2000 family of technologies continues its rapid growth. CDMA operators are well-positioned to build on the wireless data business models they have developed for CDMA2000 1xEV-DO, and their 3G voice, broadband and broadcast data services will serve as their core revenue generators as they deploy next-generation networks.

“3G is enabling new services that drive profitable wireless data business models, which will continue to be the foundation for operators even as OFDM-based technologies like LTE and Mobile WiMAX are deployed,” said Perry LaForge, executive director of the CDG. “Next-generation mobile broadband solutions will increase the value of existing 3G voice and data networks by interoperating with them to address distinct business needs.”

OFDM-based solutions promise additional broadband capacity beyond what is available today over 3G broadband networks. Just as mobile broadcast solutions, including MediaFLO, DVB-H, ISDB-T and T-DMB, have augmented 3G technologies, additional mobile broadband capacity solutions will bolster CDMA2000’s growth by fortifying the overall value proposition. These new technologies will not replace 3G solutions until large economies of scale are built and essential mass market adoption criteria, such as ubiquitous coverage, affordable tariffs, global roaming and low-cost handset availability, are met. CDMA2000 operators will continue to enhance and increase the value of their current 3G assets through an in-band evolution path, doubling the voice capacity of 1X, introducing concurrent IP-based voice and data services and increasing the data throughput speeds of EV-DO.

The majority of LTE and Mobile WiMAX networks will initially be deployed in highly populated metropolitan areas, as wider-bandwidth spectrum becomes clear and available to satisfy the increasing demand for high-capacity broadcast and broadband data services. Sprint Nextel has launched its XOHM mobile WiMAX solution in the Baltimore area in the U.S., while Verizon Wireless, SK Telecom, KTF (Korea Telecom Freetel), Telecom New Zealand, KDDI, China Telecom, MetroPCS and Aircell have announced intentions to deploy LTE. These 3G CDMA operators will rely on CDMA2000 to provide coverage and seamless roaming in the surrounding areas and in International markets.

CDMA2000 is delivering a large selection of revenue-generating services that take advantage of its nationwide high-speed mobile broadband connectivity, which lead to higher data profits for U.S. operators. Verizon Wireless generated almost $2.6 billion in data revenue during the second quarter of 2008, resulting in an average revenue per user (ARPU) of $12.58 for data alone. This figure represents 24.4 percent of the company’s total ARPU and a compound annual growth rate (CAGR) of 31.3 percent. The ARPU generated by Sprint Nextel’s CDMA2000 subscribers increased by 18 percent year-over-year to more than $15, representing 27 percent of their total CDMA ARPU.

Globally, CDMA operators added almost 25 million EV-DO users during the same timeframe, representing a 33% annual increase. There are now over 100 million subscribers taking advantage of CDMA2000 1xEV-DO services offered by 123 operators in 62 countries. Up to 44 operators have deployed CDMA2000 1xEV-DO Rev. A networks to offer advanced mobile broadband services, and another 36 operators are in the process of deploying.