Augere is a wireless broadband provider with operations in Pakistan & Bangladesh (using WiMax). It has also won the BWA spectrum in India for the MP circle in the auctions held last year and plans to launch services using LTE. Even though the number of deployments of WiMax outnumbers LTE today, equipment vendors are now focusing on TD-LTE which should help reduce both equipment as well as end user cost.

LTE Broadband DonglesThe current cost of a LTE dongles cost US$60. The company expects this to come down to US$20-30 over the next 1-2 years with rising scale. Besides, TD-LTE is already being built into some chipsets, which too should help in a relatively faster transition.

LTE Vs 3G The BWA spectrum auctioned – 20MHz of unpaired spectrum in the 2300MHz band is adequate for providing TD-LTE services. It is superior for data traffic vis-a-vis 3G due to a) larger block (only 2x5MHz spectrum allotted in 3G) and b) more flexible given asymmetric data needs i.e. higher capacity is required for downlink v/s uplink. 3G HSPA is capable of delivering 21Mbps v/s 51Mbps on LTE. The narrowing gap between the two technologies doesn’t bode too well for LTE which will need to compete with 3G services for similar customers’ needs. 3G BTS is currently 20% more expensive compared to LTE.

LTE Vs CDMA-EVDO Telecom Operators like Tata, Reliance and MTS are using spectrum in the 800 MHz for providing EVDO Data Services. This is far more efficient spectrum for broadband data and the operators’ subscriber number tells it is very well accepted.

LTE Internet Infrastructure:LTE is likely to be focused on urban markets, which reduces the propagation advantage of 700MHz spectrum (fewer BTS for similar geographical coverage). Rural coverage however will require spectrum in the 700MHz band since it will need only 1/10th the sites compared to the 2300MHz band for similar coverage. The company claims a basic LTE roll-out would require 1BTS/Km. We believe the bidding interest in 700MHz auction (over next 2-3 years) will be high given coverage advantage and lower Network CAPEX.

LTE Broadband – Retail Vs EnterpriseLTE cannot compete with fiber on capacity. While they can slice the spectrum to offer dedicated capacity to enterprise, LTE will primarily be a retail offering (residential and SME).

Operators can also provide Voice Services – You can check out LTE SmartPhones in the US Market. So Voice over LTE will definitely be a disruptive service and shake the Telecom Voice Vanilla operators in India.

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