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Semiconductor Today Magazine


15 June 2006


2G survives in the developing world


Market analysts, ABI Research of New York, USA reports that 2G and 2.5G wireless infrastructures continue to do well in developing countries. As mobile telephone infrastructure markets near saturation in industrialized nations, the report says that wireless base station vendors are looking to countries such as China and India for markets. However, the difficulty with such markets is their low wage/low price economies. Unable to move directly to 3G because of its high upfront cost and small cell size, there is a need in developing markets for easily upgradeable 2G/2.5G networks.

Lance Wilson, ABI Research director of wireless infrastructure research, said: "The major infrastructure manufacturers have to be very clever in producing cost-effective 2G and 2.5G systems for developing markets, because there isn't a lot of money to spend."

An example is Ericsson's "Expander" program: it requires 30-40% fewer cell cites than traditional GSM networks, promises reductions in both CAPEX and OPEX, has a clear upgrade path to 3G, and is designed to be profitable at monthly subscriber fees as low as $5.00, according to ABI’s "2G/2.5G is Still Alive and Kicking" report from its Wireless Infrastructure Research Service.

The report adds that the kind of wireless infrastructure appropriate for the developing world is more than just smart strategy; it may help mitigate the effects of the overall wireless infrastructure market trend that continues to stagnate, according to ABI. Only the WCDMA and CDMA2000 1x EV-DO sectors defy the market's general flatness.

Visit: http://www.abiresearch.com