td lte industry report

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TD-LTE Industry Development Report

(2012)

January 2013



TD-LTE Industry Development Report (2012) I

Contents

FOREWORD ........................................................................................................................ I

I. TD-LTE DEVELOPMENT BACKGROUND ...................................................................... 1

1.1 MOBILE INTERNET DRIVES THE DEVELOPMENT OF LTE TECHNOLOGY ................................ 1

1.2 THE TDDTECHNOLOGY WILL BECOME AN IMPORTANT MEANS OF ACCESS IN FUTURE

WIRELESS MARKET .............................................................................................................. 2

1.3 TD-LTE BRINGS GREAT CHANGES TO INDUSTRY DEVELOPMENT AND CONSUMER USE ......... 2

II. THE DEVELOPMENT STATUS OF TD-LTE TECHNOLOGY & STANDARD ................ 4

2.1 TD-LTE S TANDARD DEVELOPMENT HISTORY ................................................................. 4

2.2 K EY TECHNOLOGIES AND ADVANTAGES OF TD-LTE ........................................................ 7

2.3 TD-LTE TECHNICAL PERFORMANCE ............................................................................... 9

2.4 COMPARISON OF COMMERCIAL ABILITY BETWEEN TDDANDFDD ................................... 11

III. GLOBAL INDUSTRY DEVELOPMENT STATUS AND MAJOR TRENDS OF TD-LTE12

3.1 S YSTEM EQUIPMENT ................................................................................................... 13

3.2 CHIP AND TERMINAL.................................................................................................... 15

3.3 TEST INSTRUMENT ...................................................................................................... 18

3.4 TD-LTE SPECTRUM.................................................................................................... 21

3.5 INTERNATIONAL TD-LTE S TANDARD ORGANIZATIONS AND INDUSTRY ASSOCIATIONS ....... 26

IV. ANALYSIS OF TD-LTE’S MARKET DEVELOPMENT AND TREND .......................... 33

4.1 THE DEVELOPMENT S TATUS OF TD-LTE MARKET ......................................................... 33

4.2 TD-LTE MARKET PROSPECT....................................................................................... 37



TD-LTE Industry Development Report (2012) I

Foreword

The development of third-generation mobile communications drives the development of

mobile data business and mobile Internet application, while the development of the latter

poses higher requirements on mobile bandwidth, which directly drives the development of

LTE technology and industry.

TD-LTE is the time-division mode of LTE technology and more suitable for the future

development of mobile services because of its "GAS" advantages: "G" (Global), "A"

(Asymmetric), and "S" (Synergetic).

The development of TD-LTE technology standards has gained support from the global

industrial chain. Currently, there are 10 system equipment manufacturers worldwide

capable of providing commercialized products of R8 standards; and 6 manufacturers with

system equipment having realized R9 standards. Respectively a total of 2 / 2 / 3 terminal

chip manufacturers have launched 5-module / 4-module / 3-module TD-LTE chips; a total

of 17 manufacturers made commitments to develop TD-LTE chips. There are a total of 8

terminal tester manufacturers, 7 PCT system manufacturers, 5 RCT system

manufacturers, 4 RRM system manufacturers, 12 network planning and optimization

instrument manufacturers, and a number of general-purpose instrument manufacturers

worldwide, which can fully support the development of TD-LTE industry.

By 2016, the number of global TD-LTE users (excluding users in China) is expected to

reach about 100 million, accounting for about 10-20% of the total number of LTE users.

The development of China's TD-LTE users depends on the pattern of operators. In case

there is only one TD-LTE operator, the number of China's TD-LTE users (i.e., China

Mobile TD-LTE users) will be over 110 million by 2016; under optimistic forecast, there

will be more than 200 million TD-LTE users by 2016.



TD-LTE Industry Development Report (2012) 1

I. TD-LTE Development Background

The development of third-generation mobile communications drives the development of

mobile data business and mobile Internet application, while the development of the latter

poses higher requirements on mobile bandwidth, which directly drives the development of

LTE technology and industry, because LTE technology provides an effective means of

access for future mobile broadband data service. TD-LTE is the time-division mode of

LTE technology and can better adapt to the development of mobile data and mobile

Internet services because of its varied up- and down-loading slot ratio which results in

flexible uploading and downloading capacity allocation.

1.1 Mobile Internet dr ives the development of LTE technology

Over the past several years, with the rapid development of mobile Internet, mobile data

traffic has occurred explosive increase, which brings great pressure on mobile

communication network of the operators. Taking American operator AT&T as an example,

with the introduction of different generations of iPhones, in four years from 2007 to 2010,

the mobile data traffic had substantially increased 80 times, this trend will continue to be

intensified with the further development of smart terminal and mobile Internet application.

According to the forecast, from 2011 to 2016, global mobile data traffic will grow by 78%

of CAAGR (source: Cisco Visual Networking Index: Global Mobile Data Traffic Forecast

Update, 2011–2016), which puts forward higher requirements for hosted network of those

operators.

The rapid development of the Internet of Things (IOT) also drives the accelerated change

of mobile communication industry. Following “human-to-human communication”, the

brand-new markets such as “human-to-thing communication” and “thing-to-thing

communication” are also opened up. It is predicted that global IOT market scale will grow



2 TD-LTE Industry Development Report (2012)

by an average annual rate of 26% during the period 2007 - 2014 to reach $15.5 billion,

and by 2020, “thing-to-thing communication” business scale will reach 30 times that of

“human-to-human communication” business. The growth of mobile network data traffic

brought about the higher requirements on real-time and other network performances

urgently need to be addressed by new generation of mobile communication technologies

with high capacity.

1.2 The TDD technology will become an important means of access in future

wireless market

The increasingly scarce spectrum resources and the rise of TDD technology contribute to

significantly increased concern to TDD spectrum worldwide. With the transformation from

narrowband voice service to broadband data service by hundreds of mobile operators

globally, spectrum resources become increasingly scare. Only making full use of all kinds

of spectrum resources can market demand be effectively met, therefore, TDD spectrum

originally not being paid attention to and fully used has a more important strategic position.

As of the end of May 2012, among more than 50 countries and regions worldwide issuingmore than 170 mobile broadband spectrum licenses, there are more than 20 countries

and regions issuing more than 60 TDD mobile broadband spectrum licenses.

Meanwhile, the rise of TDD technology represented by TD-LTE around the world makes

the efficient utilization of TDD spectrum possible, TD-LTE, with its excellent technology

performance, converged with LTE FDD to form industry chain characterized by scale

advantage, and to make TD-LTE one of key foundations for achieving mobile broadbanddevelopment. TDD technology thus becomes an important means of access in future

wireless market.

1.3 TD-LTE brings great changes to industry development and consumer use

LTE has for the first time realized the unification of global mobile communication

technology & standard and brought unprecedented scale advantage for the global




industry. TD-LTE and LTE FDD are two major branches of LTE, but with high degree of

similarity and uniformity. At present, TD-LTE and LTE FDD have already achieved

comprehensive convergence from standard, industry chain to product, and in 3GPP and

other international communication standard organizations, LTE TDD/FDD is the same

modulation technology standard; global leading system providers such as Huawei, ZTE,

Datang, Ericsson, Nokia Siemens Networks and Alcatel-Lucent have introduced shared

TDD/FDD platform products; while shared TDD/FDD chip products have also become a

common R&D direction of global chip vendors, with several types of chips already being

launched. On that basis, converged TD-LTE and LTE FDD network has already become

an important means by global operators for LTE networking, with the first batch of

dual-mode commercial networks being already opened in Europe, Asia and other

regions.

The comprehensive convergence of LTE TDD and LTE FDD makes LTE a common

evolution direction of global broadband wireless access technology and will bring global

market and industrial potential whist achieving the economies of scale, effectively

reducing manufacturing cost and bringing benefits for vendors, operators and users.

Meanwhile, the convergence of LTE TDD and FDD provides the possibility for global LTE

roaming, in different countries/markets, whether using TDD spectrum or FDD spectrum,

mobile broadband data services can be enjoyed just by using the same multimode

terminal, which creates great convenience for users.

LTE will profoundly change mobile Internet application mode and creates better mobile

Internet experience for vast mobile users. LTE’s performances like high bandwidth, low

latency and always online will greatly improve user experience. For instance, traditional

mobile games will be able to be upgraded as interactive HD fight games, ordinary video

monitoring be upgraded as HD videos and traditional voice business be upgraded as HD

voice business. Meanwhile, it can replace traditional satellite broadcast, the more

convenient and more cost-saving “shooting is uploading” business is also gradually




favored and widely applied by industry users.

LTE will also boost the development of IOT, cloud computing and other strategic

emerging industries so as to advance the informationization level of the whole society.

The IOT and cloud computing are developing rapidly across the world, with back-end

information processing ability being rapidly promoted along with the improvement of

computing power and front-end information acquisition ability continuously enhanced

along with the development of sensor technology, however, the present communication

network cannot completely meet the interaction between the two. As LTE is widely

applied, LTE network will construct powerful transmission capacity to seamlessly link

back end with front end together so to achieve effective link between cloud computing

platform and terminal, thus providing better bearing for industry application and facilitating

the development of newly emerged industries.

II. The Development Status of TD-LTE Technology & Standard

2.1 TD-LTE Standard Development History

In view of the trend that wireless communication is developing towards broadband, since

the year 2005, the international standard organization 3GPP has launched LTE (Long

Term Evolution) Project with the aim of researching on new generation mobile

communication technology of long-term evolution after 3G. LTE includes two modes of

FDD and TDD, of which, the TDD mode is TD-LTE.

Over the course of the research, LTE had ever existed two TDD frame structures, that is,

Type 1 and Type 2. In November 2007, under the guidance of the Chinese companies,

the industry converged two types of TD-LTE frame structures (Type 1 and Type 2) to form

uniform TD-LTE frame structure. The converged TD-LTE frame structure reserves the

core part of TD-SCDMA frame structure, while at the same time increasing general

characteristics with FDD, thus laying good foundation for building internationally

competitive TD-LTE technology and industry chain.




TD-LTE and LTE FDD as LTE’s two operating modes have kept synchronous

development in the process of standardization. In 2008, 3GPP completed technical

specification on the first version of LTE, i.e., Release 8 version, this is the major version

adopted in TD-LTE commercial equipment at the moment. Later in 2009, 3GPP released

technical specification on the second version (Release 9). Since then, the third version

(Release 10) was also completed in early 2011; its TDD and FDD modes (i.e.,

TD-LTE-Advanced and LTE-Advanced FDD) were accepted by ITU as international

standards for 4G technology. LTE Release 11 is the latest version so far, the

standardization work has entered the final stage. Afterwards 3GPP will launch the study

on Release 12 to further achieve technology performance improvements.

TD-LTE Standard Development Memo

Time Event

2004In November, 3GPP decided to launch the research project on Long Term

Evolution of 3G System at the meeting held in Quebec.

2005In November, 3GPP Working Group Meeting held at Seoul passed TD-LTE

technical proposal on TD-SCDMA Follow-up Evolution.

2006In J une, TD-LTE feasibility research carried out by the industry was basically

completed, standard setting was initiated.

2007

In September, several international operators jointly put forward to support

TDD frame structure of Type 2 at the 37th session of 3GPP RAN. In

November the same year, TD-LTE convergence technology proposal was

passed at J eju Working Group Meeting and established the proposal of taking

TD-SCDMA standard frame structure as TD-LTE standard frame structure

20083GPP completed technical specification on the first version of LTE, i.e.,

Release 8 version.




20093GPP released technical specification on the second version of LTE, i.e.,

Release 9.

2010 3GPP completed LTE-A Release 10 basic version.

2012

The technical specification on the fourth version of LTE, that is, Release 11, is

about to be frozen. The preparation of technical specification on the fifth

version of LTE (that is, Release 12) started.

Source: TDIA

The relationship among all TD-LTE standard versions represents smooth evolution, with

new version compatible with the previous one. Release 8 version designed a brand-new

wireless communication system containing OFDM, MIMO and other key technologies and

achieved system design objective of air interface peak rate above 100Mbps. Based on

this, Release 9 version was enhanced, with MBMS, Home eNodeB, terminal positioning,

enhanced downlink beam forming and other new functions added to it, which enriched

the system’s business support ability. Release 10 version (i.e., TD-LTE-Advanced)

introduced several new technologies to further enhance system performance, including

carrier aggregation, relay technology, further enhanced multi-antenna technology and

heterogeneous network, etc., with peak rate reaching above 1Gbps.




Source: ：CATR of MIIT

2.2 Key Technologies and Advantages of TD-LTE

Compared with 3G, TD-LTE makes important technical innovation in terms of physical

layer, air interface high layer protocol and network architecture, etc., and has strong

strengths in system capacity, deployment flexibility, transmission delay, business quality

and network cost. TD-LTE’s key technologies and advantages are as follows:

① Adoption of OFDM and MIMO technology achieves higher peak rate and

spectrum efficiency. TD-LTE adopts OFDM technology more suitable for broadband

system, in combination of MIMO multiple antenna, fast packet scheduling and other

advanced designs to achieve higher peak rate, while at the same time being able to

provide spectrum utilization efficiency two to three times above 3G HSPA. Under the

circumstance of adopting 2T1R and 20MHz of system bandwidth as well as 3:1

downlink/uplink time slot allocation, the downlink peak rate of TD-LTE network can reach

110Mbps and 30MHz for uplink peak rate. TD-LTE-Advanced supports the maximum

allocation of 100MHz system bandwidth and 8T4R to further support peak rate over

1Gbps.




② Flexible system bandwidth and carrier aggregation meet the needs of various

frequency scenarios. TD-LTE supports 1.4/3/5/10/15/20MHz, with a total of six different

system bandwidth options, the more advanced TD-LTE-Advanced can support different

mix of more than six bandwidth options with carrier aggregation technology, including the

mix of continuous and discontinuous frequency resources, the maximum can reach

100MHz system bandwidth, fully satisfying the needs of various frequency resource

scenarios and network deployment bandwidth.

③ Simplified network architecture and smart network management reduce system

cost. TD-LTE eliminates RNC node and instead, adopts flat network architecture and

more simplified system protocol design. On that basis, SON technology (self optimization

of network) is widely applied in TD-LTE to realize smart network management, and

effectively reduce network deployment & operation cost as well as CAPEX and OPEX.

④ Dynamic packet scheduling technology considers both service quality and

resource utilization efficiency. TD-LTE’s simplified network architecture reduces

transmission delay and facilitates the application of dynamic resource scheduling

technology. In technical design of air interface, TD-LTE adopts resource allocation mode

completely based on packet switching and according to the user’s situation, quickly

conducts optimal allocation of resources, which effectively ensures the efficiency in the

utilization of system resources while providing service quality guarantee for various

real-time businesses.

⑤ Agile UL/DL time slot allocation meets the need of asymmetric traff ic of network.

The flexible allocation of UL/DL time slot is an important feature of TDD technology.

TD-LTE supports seven types of different UL/DL time slot allocations, including mostly

9:1 for downlink and mostly 2:3 for uplink, can make corresponding choice according to

different requirements of uplink and downlink traffic in the actual network to satisfy

different planning requirements. Recently 3GPP is carrying out further technology

research with the aim of exploring the feasibility and technical solutions on the use of




different time slot allocations in each area of TDD network, which will further strengthen

the flexibility of UL/DL traffic allocation in TD-LTE network.

⑥Smart antenna technology based on channel reciprocity further improves

system performance: the reciprocity of TDD channel facilitates the application of smart

antenna technology, TD-LTE continues TD-SCDMA’s smart antenna technology and has

it further expanded. At present, smart antenna technology adopted by commercial

TD-LTE Release 8 version supports single-flow data transmission, while TD-LTE and

TD-LTE-Advanced of Release 9 version may support double flow data transmission as

well as parallel transmission of 8-flow data to the maximum, which can further strengthen

system performance and the communication performance of cell edge users in particular.

2.3 TD-LTE Technical Performance

Since 2009, China has carried out TD-LTE technology test, scale technology test and

scale up test for the purpose of comprehensive validation of TD-LTE technical

performance. According to the current test results, in real network environment of

external field, TD-LTE network comprehensively reaches the expected index in peak rate,

time delay, throughput, user capacity and network performance, etc.

① Peak data rate

Peak data rate refers to the maximum communication rate the user can achieve in the

network; it is an important index to test the throughput of TD-LTE system and terminal.

In scale test of external field, the downlink peak rate of TD-LTE system with 20MHz, 2:2DL/UL time slot allocation and Level 3 terminal can reach 60Mbps, and 19Mbps for uplink

peak rate; In case of 3:1 time slot allocation, the downlink peak rate and uplink peak rate

can reach 80Mbps and 8Mbps respectively.

According to the test results of international commercial network, the downlink peak rate

of LTE FDD network using 2x10MHz spectrum is about 60Mbps, and about 23Mbps for




uplink peak rate. Thereby, In the case of adopting the same spectrum (that is, TD-LTE

adopts 20MHz and LTE FDD adopts 2x10MHz), the peak rate of TD-LTE network with 2:2

time slot allocation is basically close to that of LTE FDD. The downlink peak rate of

TD-LTE network with 3:1 time slot allocation is about 20Mbps higher than LTE FDD,

however, about 15Mbps lower than LTE FDD as uplink peak rate concerned.

② Transmission delay

Transmission delay includes user service delay, control plane delay and handoff delay.

Of which, user service delay refers to the time required for service data to transfer

between network and terminal, it is an important index to measure the ability of TD-LTE

system to support real-time service; control plane delay refers to the time required to user

to transfer from idle state to network access; handoff delay refers to the time required for

user to switch between the two cells. All these are important parameters to ensure good

user experience.

When testing user service plane delay by adopting TD-LTE system with 20MHz, 2:2

DL/UL time slot allocation and ping packet in TD-LTE scale test network, the transmission

delay required for small data packet returning to terminal after being sent to application

server of network end from terminal is averagely 20-30ms, which is basically in line with

the expectation. The difference between TD-LTE and LTE FDD in time delay is mainly

because their air interfaces adopt different mechanism, due to discontinuous

transmission of TDD, there are certain cache delay, according to the actual network test

results, the difference between the two is 2-7ms.

Meanwhile, using the network configuration the same as those for user plane delay test

above, TD-LTE network’s control plane delay (the time required from sending the first

random access preamble at terminal to sending RRC connection reconfiguration at

terminal) is about 80ms, the handoff delay (the time required from sending the last packet

in serving cell to the arriving of this packet to terminal in destination cell) is about 60-70ms,

all reach higher level.




③ Average cell throughput

Average cell throughput refers to the sum of throughputs of multiple concurrent users

when using the services in the same cell; it is a major indicator reflecting TD-LTEnetwork’s service capacity. In network environment in which multiple cells are loading at

the same time, by adopting TD-LTE system with 20MHz, 2:2 DL/UL time slot allocation,

and 20 users are evenly distributed in the tested cell, the average downlink throughput of

TD-LTE cell can reach above 25Mbps, the throughput of each cell edge user is no less

than 440kbps; the average uplink throughput of the cell can reach above 11Mbps, and

the throughput of each cell edge user is no less than 260kbps.

④ Concurrent user capacity

Concurrent user capacity means that on the condition of guaranteeing certain traffic rate,

the maximum number of users that the system can serve concurrently, a major index

reflecting TD-LTE network user capacity.

Concurrent user capacity is mainly limited by scheduling signaling and traffic channel

resources, in multi-cell simulation loading environment, by adopting TD-LTE system with

20MHz, 2:2 DL/UL time slot allocation and special time slot allocation of 10:2:2, each cell

can support 200 terminals to be on-line at the same time, with downlink throughput being

kept above 100kbps and uplink throughput above 50kps.

2.4 Comparison of Commercial Abil ity between TDD and FDD

From the perspective of theoretical analysis and actual network operation condition,

TD-LTE and LTE FDD have equivalent technical performance; shared platform

development further narrows the level of the two. In the subsequent LTE-A phase,

TD-LTE-Advanced kept up equivalent performance level as LTE Advanced FDD, which

was fully demonstrated in the preparation of international standard for 4G technology.

During the period 2009 to 2010, ITU assessed three types of technologies of




TD-LTE-Advanced, LTE Advanced FDD and 802.16m, eight assessment teams from

North America (ATIS, Canada, TR-45), Asia (China, J apan, South Korea) and Europe

(WINNER+, Russia) submitted technical assessment results on TD-LTE-Advanced, with

comprehensive assessment for the technical indicators of the system, including peak

spectrum efficiency (8.54 bit/s/Hz for uplink, 16.86 bit/s/Hz for downlink), average cell

spectrum efficiency (2.4-3.7 bit/s/Hz for downlink in macro cell scenario), cell edge

spectrum efficiency (0.067-0.1 bit/s/Hz for downlink in macro cell scenario) and VoIP

capacity (65~67 active users/sector/MHz in macro cell scenario) and other aspects. All of

the assessment results show that, for the technical indicators of all the aspects assessed,

TD-LTE-Advanced and LTE FDD Advanced have equivalent technical performance, both

of them can meet technical requirements of ITU IMT-Advanced.

TDD technical standards such as TD-LTE and TD-LTE-Advanced have technical

performance equivalent to FDD technical standard, whilst with unique advantage as TDD

time division technology. From the perspective of technology and product, the products

with TDD technology have commercial ability equivalent to those using FDD.

With the arrival of 4G era, the GAS advantage of TDD technology is gradually presenting:

“G” (Global) – TDD spectrum is widely applied in the countries all over the world, the

global core frequency bands concentrate in 2.3G/2.6G/3.5G/1.9G, which can achieve

global roaming; “A” (Asymmetric) – TDD technology inherently has asymmetric support

ability, most suitable for mobile Internet service; “S” (Synergetic) – TD-LTE is 3GPP’s

standard technology, naturally converged with GSM, UMTS, LTE FDD, meanwhile, both

TD-LTE and WiMAX/TD-SCDMA belong to TDD technology, they can be well converged

too. The GAS advantage of TDD technology is increasingly recognized by the industry,

and thus brings even higher expectations for the development of global TDD industry.

III. Global Industry Development Status and Major Trends of TD-LTE

TD-LTE as the mainstream technology of global mobile broadband era has not only




become international standard, but also got recognition and support from industrial chain

such as global vendors, operators and industry associations. Through four years of

development and cooperation, at present, global major system vendors including Datang,

Huawei, ZTE, Ericsson, Alcatel-Lucent, Nokia Siemens and major chip vendors such as

Hisilicon, Qualcomm, Leadcore, Marvell, Spreadtrum, MediaTek and Innofidei, as well as

major test instrument vendors like StarPoint, Rohde & Schwarz, DT LinkTester,

Zhongchuang Telecom Test, Agilent and Aeroflex all support this technology. In the next

stage, TD-LTE and LTE FDD will be further converged and to achieve base station

sharing and all in one terminal.The recognition and support from international industry

and market will continue to expand, thus consolidating its solid foundation in global

deployment and commercial application.

3.1 System Equipment

3.1.1 The Present Industry Situation of TD-LTE System Equipment

TD-LTE system equipment includes equipment products such as RAN, CN and network

management, etc.

At present, TD-LTE system equipment is mature as a whole and has commercial

operation ability. TD-LTE is under the transition from industrialization to commercial

operation. As of the end of 2012, 14 TD-LTE commercial networks have been operated

worldwide, with TD-LTE commercial users over 1.5 million. These cases fully

demonstrated TD-LTE’s commercial operation ability under complex conditions.

As viewed from the development of global LTE industry, the maturity level of TD-LTE

system equipment is close to that of LTE FDD, with basically the same industry support.

In terms of RAN products, the maturity degree of TD-LTE is close to that of LTE FDD; in

CN and network management, TD-LTE is almost the same as LTE FDD; in commercial

operation, the gap between TD-LTE and LTE FDD is rapidly narrowing.

Multi-vendor supply pattern of TD-LTE system equipment has already formed. As of the




end of 2012, all those 10 mainstream system equipment vendors have provided the

products meeting R8 standard technical requirements, of which, six vendors’ system

equipment achieves R9 standard and reaches commercial deployment requirements.

Multi-vendor Supply Situation of TD-LTE System Equipment

Vendor Commercial Network

Huawei

Softbank in J apan, STC and Mobily in Saudi Arabia, UKB in UK,

Aero2 in Poland, Hi3G in Denmark, Dialog Axiata in Sri Lanka,

Omantel in Oman, Bharti AirTel in India

ZTE Hi3G in Sweden, Bharti AirTel in India, Softbank in J apan, ChinaMobile Hong Kong Limited

Nokia

Siemens

Bharti AirTel in India, SKY TV in Brazil, STC and Mobily in Saudi

Arabia, MTS in Russia

EricssonNBN in Australia, China Mobile Hong Kong Limited, Omantel in

Oman, STC in Saudi Arabia

Samsung Mobily in Saudi Arabia

Alcatel-Lucent STC in Saudi Arabia

Source: organized by TDIA

3.1.2 Industry Development Trend of TD-LTE System Equipment

From the perspective of technology development, the TD-LTE system equipment in the

future will present the following development trend:

① TD-LTE and LTE FDD will share hardware platform and higher proportion of software

module, which will become a mainstream.

② The development of broadband RRU and large capacity BBU hardware not only

supports multi-band and multi-mode, but also facilitates the development of distributed

base station. The base station products in the future will be designed using cloud-based

network architecture in most case to save CAPEX and OPEX.




③ The integration level of base station is further improved. Miniaturized antenna,

separated function module and advanced elements will all contribute to the

miniaturization and microminiaturization of the base station products.

④ To adapt to multi-network co-existence and heterogeneous network architecture, new

system products such as Pico, Small Cell, Femto will be more applied to support more

agile three-dimensional network.

⑤ TD-LTE network system will apply more new technologies, for example, CA/

Relay/COMP technologies in R10 version, to further improve TD-LTE network

performance.

From the perspective of industrial chain, the shared platform of TD-LTE/LTE FDD

represents a general trend for LTE industry, TD-LTE and LTE FDD will be able to share

scale economies effect in the global market.

3.2 Chip and Terminal

3.2.1 The Present Situation of TD-LTE Chip & Terminal Industry

TD-LTE terminal chip mainly include such major parts as baseband chip, RF chip, RF

chip front end. Chip development involves chip design, chip manufacturing, packaging

and other links. TD-LTE terminal is divided into single-mode terminal and multi-mode

terminal, the main product forms include data terminal (data card, MiFi, CPE) and mobile

phone, tablet PC, etc.

In the chip industry, as of December 2012, more than 17 chip vendors had committed to

undertake TD-LTE chip R&D. At present, almost all chip vendors introduce TD-LTE chip

in the world, of which, two vendors introduce TD-LTE chip supporting five modes

(TD-LTE/LTE FDD/TD-SCDMA/WCDMA/GSM), another two introduce the chip supporting

four modes (TD-LTE/LTE FDD/TD-SCDMA/GSM), and other three vendors introduce the

chip supporting three modes (TD-LTE/TD-SCDMA/GSM). The TD-LTE chip adopting




40nm process has higher degree of maturity and can better support commercial

requirements of data terminals like CPE and MiFi; at the moment, all chip vendors are

actively developing TD-LTE chip with 28nm process, and at least one company has

already introduced TD-LTE commercial chip adopting 28nm process and implemented

mass production.

TD-LTE Baseband Chip Vendor

Classification Vendor

Traditional TDD chip vendor Spreadtrum, Leadcore, CYIT，ST-E, MTK, Marvell

Traditional FDD chip vendorQualcomm, Hisilicon, Samsung, Nvida, Broadcom,

Infineon, ST-E, MTK, Marvell, ZTE Microelectronics

Traditional WiMAX chip vendor Intel, Sequans, Altair, Wavesat

Newly emerged chip vendor Innofidei, RDA Microelectronics

Source: organized by TDIA

Global mainstream terminal vendors accelerate the progress of TD-LTE R&D. According

to statistics, as of J an, 2012, 124 models of TD-LTE commercial terminals had been

released around the world, including data card, CPE, MiFi, cell phone and other forms of

terminal. TD-LTE cell phone has obtained breakthrough, at the end of September 2012,

Softbank of J apan released six models of TD-LTE smart phones jointly with other five

terminal vendors, all adopted 28nm chip. In November 2012, TD-LTE cell phones

(including two models of dual standby and CSFB) developed by some vendors including

Huawei, Samsung, ZTE won the bid for collective procurement of “TD-LTE Scale Up

Technology Test” carried out in China, and are expected to be put into the test in early

2013.

3.2.2 The Development Trend of TD-LTE Chipset and Terminal




In the initial stage of industrial development, the data terminals with 40nm process based

chipset can meet TD-LTE application requirements. However, along with the maturity of

TD-LTE industry and the commercial promotion, the performance of TD-LTE chipset and

terminal need to be further improved in order to provide better use experience. In the next

stage, the major development trends of TD-LTE chipset and terminal are as follows:

① Terminal chipset supports the multi mode operation to meet the requirements

of operators for multi-network operation and international roaming. The chipsets

supporting five different network modes (TD-LTE/LTE FDD/TD-SCDMA/WCDMA/GSM)

will become the mainstream of TD-LTE chipset in the future, it is expected that in 2013

more than six chipset vendors will introduce the chipsets supporting five modes, while

individual advanced manufactures will release the chipset supporting six modes

(TD-LTE/LTE FDD/TD-SCDMA/WCDMA/CDMA 2000/GSM). The majority of baseband

chipset vendors have already realized shared platform development, the support of

multi-mode terminal chipset for TD-LTE will mainly depend on the selection of RF chip

and its front end elements, which will determine the ability of terminal to support TDD

frequency band.

②TD-LTE RF chip supports multi-band frequency. Global TD-LTE frequency

distribution represents the characteristic of decentralization, which requires TD-LTE

chipset to be able to support multi-band frequency. At the same time, to achieve

economies of scale, TD-LTE chipset will also support LTE FDD. This is consistent with

the development trend of TD-LTE system equipment.

③TD-LTE terminal is transited from data terminal to mobile terminal . At the present

stage, most TD-LTE terminal products adopt the form of data card with 40nm process

based chipset. Considering power consumption and volume of chipset, 28nm process

based chip would be more suitable for large scale development of TD-LTE mobile

terminal. It is expected that in the third quarter or the fourth quarter of 2013, the majority

of global chip vendors will be able to support 28nm multi-mode engineering samples




supporting TD-SCDMA/TD-LTE; through further product validation and secondary Tape

Out, it is expected that by 2014, most global vendors will be able to provide the 28nm

TD-LTE chipset supporting multi-mode, and TD-LTE smart phone will be applied

commercially on large scale.

④ Voice solution is important to TD-LTE mobile phone development . As viewed

from LTE FDD’s experience in commercial operation, smart phone with voice and

broadband data capacity is the most preferable for end users. Therewith, operators and

equipment vendors have gradually identified TD-LTE voice solution, of which the CSFB

will be experimented in the end of 2012 to early 2013.

⑤ TD-LTE data terminals develop with WiFi feature. At present, the TD-LTE terminal

with WiFi have greater market demand, which is in line with the development stage of

terminal and mobile service.

3.3 Test Instrument

3.3.1 The Development Status

TD-LTE test instrument’s development is basically in line with LTE FDD. Now TDD test

instrument already can provide strong support rather than be the bottleneck for industrial

development.

TD-LTE test instrument includes terminal test instrument and network test instrument.

Terminal test instrument includes: integrated terminal tester, RF conformance testing

system (RCT), wireless resource management (RRM) conformance testing system,protocol conformance testing (PCT) system, etc. Network test instrument is mainly

composed of network planning & optimization test instrument and R&D test instrument.

TD-LTE test instrument has already formed a pattern of joint participation, shared

platform and synchronous development by global vendors, and realized the pattern of

multi-vendor supply in each field.




Statistic of TD-LTE Test Instrument Vendors

Product Field Vendors

Integrated terminal tester 8

Terminal protocol conformance testing system 7

RF conformance testing system 5

RRM conformance testing system 4

Simulation instrument 7

Air interface monitor 2

Sweep generator 7

Drive test 7

Vector signal analyzer 3

Source: organized by TDIA, Q3 of 2012

① Integrated terminal tester

8 vendors in the world have introduced integrated terminal testers for commercial use,

realized same development between TD-LTE and LTE FDD instruments, and already

took the lead in meeting GCF validation requirements in 2011.

② RF conformance testing (RCT) system

5 instrument vendors in the world have already provided LTE TDD/FDD RCT system for

commercial use, with relatively comprehensive TD-LTE RF testing function. At present,

the key for RCT product development is to reduce equipment cost, while improve

multi-mode support ability.

③ Wireless resource management (RRM) conformance testing system

4 instrument vendors in the world have already launched mature RRM products, which

support multi-mode interoperability among TD-LTE and TD-SCDMA/GSM and other

systems, with stable product performance supporting more wireless modes.




④ Protocol conformance testing (PCT) system

PCT system is one of the testing means that must be used in terminal chip R&D and

terminal validation test. More than 4 vendors in the world have launched mature TD-LTE

and LTE FDD protocol testing products. PCT system will support the interoperability

among TD-LTE and LTE FDD and WCDMA next.

⑤ Network planning & optimization ins trument

A total of 12 vendors in the world have introduced mature network planning &

optimization test instrument products. Of which, more than 7 vendors’ drive test software,

sweep generator and other products have already been supplied to Softbank of J apan

and other operators.

⑥ R&D test instrument

R&D test instrument has no longer been a restraining factor for the development of

TD-LTE industry; at least 8 manufactures have released relevant commercial products.

From the above, test instrument has fully been capable of supporting the rapid

development of TD-LTE industry chain. In 2012, the application of TD-LTE test

instrument focused mainly on R&D and testing. Along with the acceleration of TD-LTE in

commercial application, test instrument will quickly extend to production test and the

application of network planning & optimization.

3.3.2 Development Trend

① Platform sharing and supporting multi-mode. On the basis of unified platform,

multi-mode module and multiple test tools are integrated into the same test instrument,

the test instrument will support the requirements of multi-mode and multi function, which

means supporting both TDD and FDD. The platform sharing of test instrument also

contributes to reducing cost.

② Networking test. Networking test is the development requirement of modern testing




technology, which can provide unified and distributed management of the network. It will

change present testing mode. In networking test, people are not constrained by time and

space, realize remote control at low cost and acquire information needed anytime and

anywhere, thus improving testing efficiency.

③ Intellectualization and automation. With the development of the test, operators require

automatic measurement, intelligent analysis and intelligent scheduling so as to increase

the testing efficiency of test instrument. The development of intelligent test instrument

needs to be combined with sensor technology in order to improve the accuracy of the

test.

④ In terms of new technology, TD-LTE test instrument will support multi-carrier

aggregation, multi-antenna configuration and higher category level.

⑤ Miniaturization, high accuracy and non-contact will also be important trends in the

development of TD-LTE test instrument industry.

3.4 TD-LTE Spectrum

3.4.1 The Planning of International Organizations for TD-LTE Spectrum

Since LTE technology is still in the stage of development, ITU’s LTE spectrum planning is

still under progress, the number of LTE frequency bands shows significant increase. After

WRC-07, in principle, frequency planning only distinguishes between TDD and FDD,

spectrum of 2G and 3G, as well as 3G extended frequency band, all can be used in LTE

technology. As more and more operators close 2G network, 2G frequency bands will beconstantly converted as LTE frequency band. At that time, available LTE frequency band

resources will be more and more abundant.

Overall, among newly increased mobile broadband spectrums around the world, TDD

spectrum resources are getting adequate, however, on the whole, there is still a large gap

as compared with FDD.




From the perspective of spectrum quality, FDD has a large number of LMF spectra, which

can help operators to obtain more network coverage. On the contrary, TD-LTE lacks of

LMF spectra, which be a disadvantage for wide coverage.

3.4.2 The TD-LTE Spectrum Planning of Major Countries and Regions

At present, the major countries and regions focus on high frequency above 2GHz for

TD-LTE, of which the most widely used are 2.3GHz and 2.6GHz. At the same time,

TD-LTE lacks of LF resources.

The TD-LTE Frequency Planning of Major Countr ies and Regions

Frequency Region

2300MHz The Middle East, India, China, Asia Pacific, Russia, Africa

2600MHz China, Latin America, Europe, North America, Africa

1900MHz China

3500MHz The Middle East, Latin America, Europe

Source: TDIA

In addition, along with technology development and the fact that WiMAX operators

choose to evolve towards TD-LTE, 3500MHz and other HF spectrum will be allocated to

TD-LTE technology for use.

3.4.3 The Situation on Use of TD-LTE Commercial Network Frequency

The Deployment of TD-LTE Commercial Network Frequency

National Operator Frequency 3GPP Frequency Band

Poland Aero2（FDD+TDD） 2.6GHz Band 38

Saudi Arabia Mobily 2.6GHz Band 38

Saudi Arabia STC 2.3GHz Band 40

Brazil Sky Brasil Servicos 2.6GHz Band 38




J apan Softbank 2.6GHz Band 38

Australia NBN Co 2.3GHz Band 40

India Bharti Airtel 2.3GHz Band 40

Sweden/Denmark Hi3G（FDD+TDD） 2.6GHz Band 38

UK UK broadband 3.5/3.6GHz Band 42，43

Oman Omantel 2.3GHz Band 40

Russia MTS（Moscow） 2.6GHz Band 38

Hong Kong in

China

China Mobile Hong

Kong Limited

2.3GHz Band 40

Sri Lanka Dialog Axiata 2.3GHz Band40

Source: TDIA, J anuary 2013

As viewed from TD-LTE network already applied commercially, TD-LTE is manly

deployed on Band 38 and Band 40. On the contrary, at present LTE FDD operators

basically adopt LF (700/800MHz) + HF (1800MHz/2600MHz) to build LTE FDD network,

of which, LF is used for wide-area coverage, while HF used for capacity coverage in

urban areas to meet the requirements of capacity and coverage.

On the premise of not considering network capacity, the overall cost of network

deployment with LF (including website, equipment, and infrastructure) is lower than that

with HF. Therefore, only considering the coverage, operators develop TDD technology

standards based on LF will reduce investment pressure and retain competitive edge in

the market. Currently, the TD-LTE operators in the countries have begun to pay close

attention to and call for the application of LF, global TDD frequency band resources will

be gradually increasing that provide network requirement of capacity and coverage.

3.4.4 The Global Situation on the Issuing of TDD Spectrum

More than 40 countries and regions in the world issued TDD spectrum, covering about

51% of the global population. As the issuing of global FDD spectrum resources is




basically completed, the global telecom operators tend to concern more and more on

TDD spectrum resources, and will actively participate in the auction of TDD spectrum.

In addition, Canada, Indonesia, Australia and other countries are reclaiming the already

issued 2.6GHz TDD spectrum resources for re-auction. Moreover, more TDD spectrum

resources are under cleaning and plan to be issued, for example, 3400MHz-3800MHz,

TDD part of 700MHz spectrum, 400MHz-700MHz, as well as the part above 3.8GHz.

According to statistics, currently more than 74 operators among global 150 leading ones

have obtained TDD frequency band, and more and more leading operators start to pay

attentions on the development of TDD spectrum.

3.4.5 China’s TDD Spectrum Planning

Public mobile communication spectrum in China plans 687MHz, with 307MHz already

being allocated. At present, the existing TD-SCDMA network still gives priority to Band 34

(2010-2025MHz) and Band 39 (1880-1920MHz).

October 2012, Ministry of Industry and Information Technology of the People’s Republic

of China announced that all 190MHz frequency resources out of 2500-2690MHz were

planned as TDD spectrum.

China’s TDD Spectrum Planning

Data source: State Radio Regulation of China under MIIT, organized by TDIA

The total quantity of TDD spectrum resources in China is on the increase, however, TDD

spectrum resources are in disadvantaged position relative to FDD spectrum resources,




scare low frequency resources in particular. At the moment, the Chinese radio spectrum

planning agencies are undertaking active coordination and negotiation, striving for

obtaining LF spectrum resources to support commercial application prior to large scale

application of TD-LTE commercially.

3.4.6 The Trend of TD-LTE Spectrum Planning

① The quantity of global broadband wireless TDD spectrum resources will be on the

increase, as a result TDD spectrum will draw even wider attention. The auction of global

FDD spectrum resources is basically completed; the demand of the operators on

frequency resources is shifting towards TDD spectrum resources, leading tocorresponding rise of TDD spectrum demand.

② 2.6GHz frequency band is the main band of global TD-LTE roaming, and the

foundation to achieve global TDD roaming, which is of vital importance to the

development of the TDD industry. The global TD-LTE industry also pays close attention

to the use of 2.6G band, and the ecosystem of 2.6GHz products is relatively more mature,

now, over 82% of TD-LTE terminals support this frequency band. Based on this relatively

mature ecosystem, the global mainstream equipment and terminal vendors will put more

resources into this frequency band to engage in related technology and product R&D.

③ 700-800MHz and other LF resources become consistent appeal of the TDD industry.

700-800MHz band when used for macro covered network needs only a small amount of

base stations to complete wide coverage of the suburbs, which both reduces the cost of

network construction and achieves good coverage, furthermore, the competitiveness of

TDD operators is effectively improved.

④ 3.5GHz is expected to become important TD-LTE frequency band for spreading. 3.5G

has already been applied in UBK commercial network of UK and attained great success.

Moreover, 3.5G frequency resources are abundant and planned in the UN, North America,

Asia Pacific and North America, supported by 3GPP Release 10 and subsequent




standard versions. 3.5G spectrum fits in the demand of capacity coverage and is able to

better develop TD-LTE’s asymmetric service ability.

It can be foreseen that TE-LTE technology will have more adequate spectrum resources

to guarantee its large-scale commercial application. In the future, TD-LTE will get more

LF resources to achieve even greater range of continuous coverage, thus further

strengthening the competitiveness of TDD operators in the market.

3.5 International TD-LTE Standard Organizations and Industry Associations

3.5.1 3GPP——Standard Sett ing

3Rd Generation Partnership Project (that is, 3GPP) was founded in December 1998.

3GPP’s organization partners include ETSI in Europe, ARIB and TTC in J apan, CCSA in

China, TTA in South Korea and ATIS in North America, its members also include market

partners and individual members. The objective of 3GPP is to research, formulate and

promote 3G standards, namely, WCDMA and TD-SCDMA. To meet new market demand,

3GPP constantly adds new features to standard specification to enhance its own

capability and develop gradually towards 4G LTE technology standard. In order to

provide robust implementation platform for developers and add new features, 3GPP’s

standard version is still on the increase.

The TD-LTE work carried out by 3GPP mainly includes such top-layer design as system

requirement, standardization and frequency definition in industrial development.

Early in November 2004, 3GPP decided to start Long Term Evolution Research Project of

3G system at the meeting held in Quebec, and completed relevant feasibility

demonstration in 2007.

From 2008 to 2011, 3GPP had organized to formulate three versions of R8, R9 and R10

in succession, the R11 version was completed in December 2012, and the

standardization of the R12 version was also initiated in September 2012, in which, the

progress in the development of TD-LTE is consistent with that of LTE FDD.




Secondly, 3GPP defined TD-LTE operating frequency in the relevant specification. By

J uly 2012, 3GPP had already defined 12 slices of TDD spectra in the specification, which

better guided the development of TD-LTE equipment.

Since the CDMA industry evolves toward LTE in later stage, the influence of 3GPP in the

course of global mobile communication standard unification is further enhanced. As

observed from industry evolution trend, 3GPP has already become a standard

convergence platform for global mobile communication moving towards unification.

3.5.2 LSTI——Technical Identif ication

LSTI stands for Long Term Evolution/System Architecture Evolution Trial Initiative of

3GPP LTE/SAE. LSTI is an open organization initiated by equipment providers and

operators in May 2007, with 39 members including 12 operators and 27 equipment

providers, the main objective of the organization is to drive commercial deployment of

LTE/SAE TDD/FDD by testing and publishing LTE/SAE ability.

LSTI’s work is between standardization and commercial deployment, divided into three

stages: proof of concept, interoperability, and user friendly test.

LSTI completed proof of concept for TD-LTE in J une 2009, the test results reached or

exceeded the requirements of 3GPP and NGMN. LSTI completed interoperability and

user friendly test for TDD and FDD synchronously in 2010.

J anuary 2011, LSTI announced the completion of all important work for LTE test

verification, including proof of concept (PoC), interoperability development testing (IODT),

interoperability test (IOT), user friendly test (FCT), frequency division duplex (FDD) and

time division duplex (TDD). These project results were published at Mobile World

Congress held in Barcelona of Spain in 2011.

3.5.3 GCF——Test Certification

GCF is a global certification forum composed of global mainstream operators and

terminal vendors. Test instrument vendors and testing agencies participate as observers.




GCF is committed to ensuring global interoperability of terminal through independent

certification process. The TD-LTE testing work undertaken by GCF mainly includes:

development of roadmap for TD-LTE conformance testing, test cases/planning of

platform certification process and terminal product certification & registration process.

GCF is not directly engaged in TD-LTE test service, the related work is handed over to

third-party testing agencies (such as RFI organization).

GCF has established a set of routine certification process, and GCF will hold a working

meeting every three months, during which, TD-LTE related test results, test cases and

test equipment are certified. When test cases and test equipment accord with the test

roadmap developed by GCF, the conformance certification on TD-LTE terminal

equipment will then be carried out quickly.

GCF’s test certification accelerates the development of TD-LTE terminal industry. On one

hand, GCF constantly incorporates mobile equipment with newly added TD-LTE

frequency bands into the scope of its certification to provide global certification platform

for TD-LTE terminal; on the other hand, passing GCF certification means the terminal is

recognized by GCF operator members, which speeds up commercial application of

TD-LTE.

3.5.4 NGMN——Proposal of Functional Requirements

NGMN is an international organization dominated by operators with the aim of promoting

the development and application of new generation of mobile communication system

industry. At the beginning of its establishment in 2006, there were only 7 operator

members. So far, 20 operators and 30 system/terminal/chip/instrument vendors have

participated in this organization. NGMN’s support for the development of TD-LTE is

mainly reflected in putting forward functional requirements, boosting the construction of

ecosystem of TD-LTE industry, and facilitating the maturity of TD-LTE technology and

industry.

Actively guide new generation of technology standard and product design based on




market orientation. Releas “next generation network whitepaper” and define the market

demand of TD-LTE industry; carry out the research on key issues and pushing forward

standard development.

Create good ecosystem for the industry. Define TD-LTE spectrum demand and positively

influence the government’s spectrum planning; concern about the whole ecosystem and

actively develop countermeasures for the issues.

Accelerate the process of industrialization of next generation technology. Define terminal

demand and drive the further optimization of terminal certification mechanism; develop

test demand for the purpose of pushing forward the process of industrialization by test.

Cooperate with other industry organization to jointly promote the development of LTE. In

2009, NGMN and TDIA reached strategic cooperation agreement, under which, both

parties work together to push forward the development of global TD-LTE technology, and

ensure to lay the foundation for the development of convergence standard for FDD and

TDD based next generation mobile network. In 2012, NGMN and GTI reached the letter

of intent on cooperation, the two organizations agreed to support the convergence of TDD

and FDD.

3.5.5 TDIA——Industr ialization

TDIA was voluntarily sponsored and founded by China Academy of Telecommunications

Technology (CATT) and other seven enterprises in October 30, 2002. Since the

foundation, TDIA has been committed to pushing forward the process of industrialization

of TD-SCDMA and promoting the development of TD-LTE so as to form complete

industry chain and multi-vendor supply environment soon, and advance TD enterprises to

smoothly enter the 3G and 4G of mobile communication market. As of the end of 2012,

the number of TDIA council and non-council member units totaled 90, covering vendors

of network equipment, chipset, terminal and test instrument, operators, research

institutions, colleges & universities and other types of organizations.

The main work of TDIA in pushing forward the development of TD-LTE is as follows:




① Build the bridge between the Chinese government and enterprises. Cooperating with

the Chinese government in research work for the development of TD-LTE industry and

communication standard; providing suggestions to competent authorities in the industry

to promote policy making in favor of the development of TDD industry.

② Committed to establishing intellectual property risk treatment mechanism relating to

TDD industry. At present, TDIA is sparing no effort to contact the parties concerned to

assess TD-LTE technology patent and set up dispute settlement mechanism concerning

TD-LTE industry related intellectual property so as to facilitate the healthy development of

the industry.

③ Promote collaborative breakthrough in key technology link to boost the construction of

industry chain. TDIA has been supporting and participating in the development of terminal

conformance testing TTCN code, and worked together with GCF and other organizations

to advance terminal conformance testing work. TDIA drives collaborative breakthrough

on 28nm terminal chip jointly with member enterprises and persistently consolidates the

weak links in TD-LTE industry chain.

④Demonstrate the overall strength of TD-LTE technology and release important industry

information. TDIA organizes its member enterprises to collectively participate in

international exhibitions or organizes some major events. Under the organization of TDIA,

State Radio Regulation of China under MIIT published full TDD planning scheme of

China’s 2.6GHz frequency band at ITU exhibition held in Dubai in October 2012.

⑤ Actively cooperate with international organizations to expand TD-LTE development

space. TDIA cooperates with ITU to hold “Seminar on TDD technology and frequency”every year for recent three years; in 2009, TDIA reached a strategic cooperation

agreement with NGMN to jointly push forward the development of TD-LTE technology

worldwide; TDIA and ETSI have been carrying out comprehensive cooperation since

2004 for the development of TD-SCDMA TTCN terminal conformance test code sets, two

updated versions of which have been released so far which support 3GPP R4 through R8;

in 2011, TDIA signed a strategic cooperation agreement with GTI to jointly advance the




development of TD-LTE industry environment at home and abroad; meanwhile, TDIA

works closely with 3GPP to promote the development of follow-up TD-LTE standard,

terminal conformance testing and other work, and in December 2012, 3GPP, CCSA and

TDIA jointly held 3GPP standard summit in Beijing.

At the moment, TDIA continues to promote the validation and perfection of TD-LTE

technology standard, key technology R&D, industrial development, test environment

construction, etc. moreover, TDIA is taken as the core to push forward the construction of

generic technology and public test platform, facilitate the cooperation among enterprises

and help enterprises to speed up the pace of innovation.

3.5.6 GTI——Development o f Commercial Application

In February 2011, at MWC2011 held in Barcelona, China Mobile joined hands with

Vodafone from Europe, Bharti from India, Softbank from J apan, Clearwire from USA and

other operators to launch TD-LTE global development initiative (GTI). As of December 7,

2012, GTI operator members had reached 51. At the beginning of 2012, GTI set up

Partner Forum and established vendor joining mechanism, by the end of 2012, 39 vendor

partners had been included, covering such industry chains as system equipment, terminal

chip, test instrument, etc.

GTI is a virtual open platform, with the aim of allying global operators to promote TD-LTE

ecosystem as one of the major standards for mobile broadband spectrum technology,

and with pushing forward the preliminary development of next generation mobile

broadband spectrum network as the mission.

In the field of technology development, GTI operators join together to explore key

problems in large-scale commercial application of TD-LTE, to this end, three working

groups are set up, containing 10 technical subject groups and one ad-hoc group,

gathering together the common demands of global operators, and allying the industry to

form consensus solutions. At present, GTI has already completed such research findings

as Report on Interference Coexistence Research, Multi-Mode Multi-Band Product




Demand Whitepaper , and released GTI MiFi terminal prototype supporting five modes

and 11 bands at GTI technology seminar held in October 2012.

GTI Working Groups and Key Technology Topics

Working

Group

Technology Topic Responsible

Organization

Network

Shared Network of TD-LTE andFDD-LTE Clearwire

Network Planning: Cover Planning and Solutions CMCC

Multi-antenna Solutions and Technical Index CMCC

eNB Product Planning and Technical Index Vodafone

Dynamic eMBMS Softbank

Terminal

Multimode Multifrequency Solution (Including

Roaming)

Clearwire

TD-LTE Terminal Voice Solutions Bharti

IOT and Terminal Test CMCC

Handover between TD-LTE and LTE FDD E-Plus

Business and

Service

Consumer Electronics Market Promotion Clearwire

International LTE Roaming Ad hoc CMCC

Source: GTI

In the field of market development, GTI gathers together global operators and gets the

most widely support from global industries including traditional FDD, TD-SCDMA, WiMAX

and PHS industries, and established strategic cooperation relationship with such

international organizations as GSMA, NGMN, TDIA. Under the pushing of GTI, TD-LTE

achieved major breakthrough in international market in 2012, with Softbank of J apan,

STC and Mobily of Saudi Arabia, Hi3G of Europe, Bharti of India and other international

operators from other countries officially launching commercial service.

At present, GTI continues to expand its business scope, and as an international working

platform, it gives big boost to the industry in terms of market promotion, technology




development, product roadmap and other fields, effectively realizes the combination of

product demand of operators with technology research, and greatly drives the

development of the industry and the market.

IV. Analysis of TD-LTE’s Market Development and Trend

4.1 The Development Status of TD-LTE Market

4.1.1 The Situation of Global TD-LTE Network Deployment

Through converged development, TD-LTE and LTE FDD have already become themainstream of the world’s new generation of mobile broadband technology and been

deployed worldwide. On one hand, WiMAX, PHS and other TDD technologies are in

continued evolution towards TD-LTE; on the other hand, the converged network of

TD-LTE/FDD becomes an important direction for LTE operators in network deployment.

In September 2011, the operator of Saudi Arabia Mobily took the lead in commercial

application of TD-LTE worldwide and officially launched global commercial process of

TD-LTE. By the end of 2012, a total of 13 operators including Mobily and STC of Saudi

Arabia, Softbank of J apan, SKY TV of Brazil, Hi3G of North Europe, UK Broadband of UK,

Bharti of India, NBN of Australia, Aero2 of Poland, Omantel of Oman, MTS of Russia,

China Mobile Hong Kong Limited of China, and Dialog Axiata of Sri Lanka worldwide had

opened 14 commercial TD-LTE services (of which, Hi3G opened two commercial TD-LTE

networks in Sweden/Denmark). As viewed from the scale of base station, by the end of

2011, the number of TD-LTE base stations around the world reached 9,000, and by the

end of 2012 was up to 50,000.

Meanwhile, 28 operators in the world signed a total of 44 TD-LTE commercial contracts,

with more than 22 operators publishing clear commercial operation plan. For example,

Tikona of India plans commercial operation of TD-LTE in 2013, and American operator

Clearwire announces its opening of commercial TD-LTE network in 2013, with the setup




of 2,000 base stations in the first stage. In addition, more than 63 TD-LTE experimental

networks have been opened around the world.

J apan’s third largest mobile operator Softbank officially started the world’s largest

TD-LTE commercial network in February 2012, and as of the end of 2012, developed

users of more than 719 thousand. Softbank plans to deploy 13,000 base stations before

March 2013, covering 92% of the population in J apan. Softbank’s network construction is

based on the principle of low cost and rapidly putting into use, establishing TD-LTE base

station by sharing station site with the existing PHS base station, upgrading the existing

polarized antenna of PHS base station to support dual-band antenna of 2.6GHz and

1.9GHz so as to realize shared antenna feeder, and deploying BBU, 4T4R, power

supply box and other wireless base station equipment of TD-LTE based on the existing

BBU of PHS, thus deploying TD-LTE base station at the minimum cost. Softbank adopted

terminal strategy mainly with MiFi at the initial stage of commercial operation, and then by

the end of September 2012 have released the first 6 TD-LTE smart phones in the world.

India’s largest mobile operator Bharti built the first TD-LTE network in South Asia in April

2012. Bharti gives the priority to densely populated areas with high traffic demand. At

present, Bharti has deployed TD-LTE networks in two major cities of Kolkata and

Begaluru, and set up a total of 2,000 base stations. In the second half of 2012, Bharti

started the deployment of TD-LTE networks in four cities including Delhi, Mumbai, and by

the end of the year, set up 7,000 base stations, in 2013, all the deployments will be

completed. As terminal concerned, Bharti released two types of TD-LTE terminals,

namely, indoor WiFi mode CPE and USB multimode data card.

December 2011, Hi3G of Sweden launched the world’s first converged LTE FDD/TDD

commercial network service in Stockholm, Goteborg and Malmo. So far, Hi3G has

planned to set up a total of 3,991 LTE FDD stations and 2,741 LTE TDD/FDD converged

stations, with more than 800 dual mode stations of 2.6GHz LTE TDD/FDD already being

applied commercially. Hi3G’s LTE network deployment adopts LTE FDD for wide-area




coverage and TD-LTE to meet the requirements of urban users for high data traffic. In

suburban and rural areas, 800MHz LTE FDD and 900MHz UMTS are adopted for

wide-area coverage, with partialy overlayed by 2.6GHz TD-LTE network for capacity

expansion to meet double requirements in both wide-area coverage and capacity; while

in densely populated urban areas, 2.6GHz LTE TDD/FDD is adopted for hotspot

coverage, with LTE stations overlaying on all 3G stations to meet the requirement of

those areas for high data traffic; 2.6GHz TD-LTE network is also used for capacity

supplement and coverage supplement of hotspot areas. Hi3G currently provides only

wireless Internet service for its users with multimode terminal to achieve converged

network experience. At present, data card and wireless router are available.

February 2012, in “GTI Declaration” published by GTI joining with other operators defined

commercial operation objective of “setting up 500 thousand TD-LTE base stations by

2014 to cover a population of 2 billion”. It is expected during the period 2013- 2014 that

TD-LTE will embrace the scale development of the global market.

4.1.2 Potent ial Operator Market

TD-LTE brings value for traditional FDD operators, emerging operators in mature market

and the operators in newly emerged market, with great opportunities for development.

First, traditional FDD operators in mature market try to improve the efficiency of mobile

broadband network through TDD/FDD converged network. Such as Vodafone, Deutsche

Telekom AG, etc. In the case of limited FDD frequency, TD-LTE demonstrates good

performance and has global market size in the convergence with FDD, the existing TDD

spectrum can be utilized to achieve the increase of network capacity, while at the same

time relieving 2/3G data traffic pressure. J ust because of this, Vodafone, E-plus and other

major FDD operators have purchased TDD spectrum resources in succession and

planned to establish TD-LTE as FDD’s supplement.

Second, the emerging operators in mature market face great opportunities to rapidly




capture mobile broadband market by use of TDD technology. It is very challenging for the

emerging operators in mature market to compete FDD technology of traditional operators.

However, by use of less competitive TDD frequency and technology, they can rapidly

achieve network evolution towards mobile broadband and quickly establish the

competitiveness against traditional operators with very high input-output ratio. For

example, Softbank of J apan, Clearwire of USA and other operators which have obtained

large quantity of TDD spectrum resources due to less cost, upgraded their network

towards TD-LTE to compete with local traditional operators.

Third, the operators with TD-LTE technology in emerging markets quickly achieve

wireless broadband coverage and provide information services. Such as India, South

America, South Asia, etc., though cable broadband resources are limited, these countries

and areas can quickly achieve wireless broadband coverage by TD-LTE technology,

which helps to fill digital gap and facilitate the development of local informatization. For

instance, Aircel of India planned to invest $500 million to launch TD-LTE commercial

service in Chennai in October to December 2012; Sri Lanka’s largest mobile operator

Dialog Axiata introduced TD-LTE commercial service before the end of 2012 to cover all

major regions of the country.

4.1.3 Convergence between and Development of TD-LTE and LTE FDD

In the next ten years, global mobile communication technology will accelerate the

development towards LTE, especially vigorously driven by the development of global

mobile Internet, TD-LTE, with LTE FDD, will be for the first time to unify the global

telecommunication standard of the LTE stage.

In the future, the development of mobile communication industry will face even more

severe challenge in spectrum resources. On one hand, the situation of strained spectrum

resources will be further aggravated, on the other hand, there is increase but no decrease

in the scattered property of spectrum, how to increase and make full use of strained

spectrum resources become an important challenge for sustainable development of




mobile communication industry. Those operators who own both FDD and TDD spectrum

resources can develop TD-LTE and LTE FDD services at the same time to fully utilize the

existing spectrum resources. Thereby, the convergence and development of the

FDD/TDD technology become an inevitable choice for operators.

From the perspective of technical implementation, TD-LTE and LTE FDD as two major

branches of LTE technology have high degree of similarity. At present, LTE TDD and LTE

FDD have already realized comprehensive convergence from standard, industry chain to

product platform, and can share economies of scale effect.

The development of LTE terminal chip also supports the convergence of TD-LTE andLTE FDD. At present, LTE chip supporting dual mode of FDD/TDD has become standard

configuration by the majority of chip vendors around the world. As a result, TD-LTE and

LTE FDD networks can be used on one terminal.

From industry, market to product, the convergence of TD-LTE and LTE FDD has become

a consensus in the industry, and will be the development trend of LTE.

4.2 TD-LTE Market Prospect

4.2.1 TD-LTE Market Keeps Rapid Development

In the future, TD-LTE operators will be distributed in different continents and

countries/regions. As viewed from regional coverage, every country and regions around

the world will have both TD-LTE and LTE FDD networks and services.

TD-LTE operators are divided into three categories: mainstream operators owning TDD

spectrum and providing service mainly with TD-LTE, such as China Mobile, Bharti, Airtel,

etc.; mainstream operators owning both FDD and TDD spectrum resources and provede

with TD-LTE network as a supplementary service, such as Softbank Mobile, Hi3G

Sweden, etc.; service providers owning BWA TDD spectrum to carry out wireless

broadband access service, such as Clearwire Wireless, UK Broadband, etc.




TD-LTE operators are mainly distributed in Asia Pacific region, Eastern Europe and North

America, Western Europe, Latin America. In Asia Pacific region, TD-LTE operators are

constituted by local telecom operators and with TDD technology as the major means to

provide LTE service. In Eastern Europe and North America, TD-LTE operators will be

dominated by local wireless broadband access service providers. In Western Europe,

TD-LTE operators are mainly composed of local telecom operators, but TD-LTE will be

taken as a supplement for wireless access. As viewed from population coverage, TD-LTE

will cover the world’s top ten countries in terms of population size including China, India,

Russia, USA, Brazil, Pakistan, Nigeria and J apan, which accounts for about 37.8% of the

global population. In addition, the population of other European regions accounts for

about 8% of the global population (Data source: UN, 2010). Overall, TD-LTE will cover

more than 45% of the global population.

TD-LTE industry and technology are becoming more mature, with the contrast that

WiMax camp is gradually weakening. More and more WiMax operators will shift towards

TD-LTE and become TD-LTE operators. It is expected that by 2015, TD-LTE industry will

be able to reach the maturity degree of LTE FDD, TD-LTE will fully demonstrate its

advantage in frequency use and asymmetric data, and the operators will compare

FDD/TDD technology without of industry interest and other additional factors, and make

technology choice by technical performance, frequency resource status. The operators

will even replace FDD technology with TDD.

By the beginning of 2013, it is estimated that there will be 20 TD-LTE operators around

the world, accounting for approximately 14% of total LTE operators, and the proportion

shows some increase compared with that of 2012. By 2015, it is estimated that there will

be more than 100 TD-LTE operators worldwide.

4.2.2 Over 210 Million TD-LTE Users in 2016 Globally

① International market (excluding China)

The development of global TD-LTE market (excluding China) mainly focuses on India,




USA, J apan and other operator market.

According to the estimation, by 2016, the number of global TD-LTE users (excluding

China) is expected to hit 100 million or so, accounting for about 15- 20% of total LTEusers.

Global TD-LTE User Development Forecast (Exclud ing China)

Unit: million

Year 2014 2015 2016

User Number 15 50 100

Source: TDIA

① Chinese market

China has consistently supported the development of TD-LTE technology and the

industry, the advantage of the Chinese equipment vendors and chip vendors in TDD is

stronger than in FDD.

Under moderate expectation, China Mobile, one of the Chinese operators, will adopt

TD-LTE. China Mobile will take more proactive strategy to develop TD-LTE, the speed of

development is expected to be apparently faster than TD-SCDMA. Under such

assumption:

¾ In 2013, China Mobile will built TD-LTE network covering 100 cities. According to the

average user scale of 20 thousand per city, total users will reach 2 million. In early

2013, China Mobile has publicly announced that the quantity of TD-LTE terminals

purchased in 2013 will exceed 10 times of that of 2012 (80,000 sets in 2012), while

the industry generally estimates that the purchase quantity of China Mobile in TD-LTE

terminal is expected to hit 5 million in 2013.

¾ During the period 2014-2015, the development of China Mobile’s TD-LTE users will

mainly depend on market promotion by the operator and the users’ changing new




phone. 3G user scale does not constitute the ceiling for the development of TD-LTE

market. At this stage, the growth rate of China Mobile’s TD-LTE users can refer to

TD-SCDMA market. Considering the below conditions: ① with industrialization in

2013, 3 modes (GSM/TD-SCDMA/TD-LTE) chipsets and terminals will enter the

market in late 2013 or early 2014 before 5 modes terminals, which will promote the

development of TD-LTE greatly; ② CMCC devotes more on TD-LTE than

TD-SCDMA. Thus, TD-LTE user growth rate in 2014-2015 will be higher than that of

TD-SCDMA earlier.

¾ By 2016, both of 3 modes and 5 modes TD-LTE chipsets will be mature for cost down.

Popular TD-LTE smartphone will reach below 1000 RMB (price of popular

TD-SCDMA smartphone has been under 1000 RMB in 2012, the 4th commercial

year.) In this stage, most new added subscribers and those who change their phones

will be TD-LTE users. Thus, TD-LTE user growth rate will be higher than that of

TD-SCDMA in 2012.

¾ The number of China’s TD-LTE users (China Mobile’s TD-LTE users) is expected to

be over 110 million in 2016.

Analysis of TD-SCDMA and TD-LTE Development (Moderate)

Unit: K

Year 1st

Year 2nd

Year 3rd

Year 4th

Year

TD-SCDMAUser Number 3408 20702 51212 87928

Average Monthly Increase - 1440 2540 3060

TD-LTE

User Number 2000 22753 60890 112293

Average Monthly Increase - 1729 3178 4284

TD-LTE Growth Rate/TDS

Growth Rate- 120% 125% 140%

Source: TDIA




Under optimistic anticipation, the operator besides China Mobile will also develop TD-LTE,

whose TD-LTE market situation will be close to its own 3G business, even superior to its

3G business. The development of the operator’s TD-LTE users on one hand depends on

its 3G user base, on the other hand, it has to consider the competition with other

operators, which means that China Mobile’s TD-LTE market strategy will urge this

operator to devote more into TD-LTE. Under such assumption, it is expected that by 2016,

China’s TD-LTE users will reach about 124 million.

Forecast on China’s TD-LTE User Development (Optimistic)

Unit: K

Year 2013

(1st Year)2014

(2nd Year)2015

(3rd Year)2016

(4th Year)

China

Mobile

3G User Number 3408 20702 51212 87928

Average Monthly

Increase- 1440 2540 3060

TD-LTE User

Number2000 22752.8 60890.3 112292.7

Average Monthly

Increase - 1729.4 3178.1 4283.5

China

Unicom

3G User Number 2742 14060 40019 76456

Average Monthly

Increase- 940 2160 3040

TD-LTE User

Number- 7200 31200 60000

Average Monthly

Increase- 600 2000 3000

China

Telecom

3G User Number 5260 12290 36290 69050

Average Monthly

Increase- 590 2000 2730

TD-LTE User

Number- 4800 16800 30000

Average Monthly

Increase- 400 1000 1500

Total TD-LTE User Number 2000 34750 108890 202290



Source: organized and analyzed by TDIA

As viewed from the analysis of global mobile operators, TD-LTE market shows optimistic

growth potential. TD-LTE will become the mainstream of mobile communication

technology & standard and the market, and gradually demonstrate its unique advantage

in mobile application.

td lte industry report

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