Operators to Invest $18 Billion in UMTS Long Term Evolution Networks by 2014

Long Term Evolution (LTE) of 3G technologies is about to benefit from Rel-8 of the 3GPP standard, planned for the third quarter of 2007. This will be the trigger for development of components and systems to provide 100 Mbps download speeds to mobile devices. According to a new study from ABI Research, network operators will invest a total of almost US$18 billion in LTE capital infrastructure over the period to 2014.

This will yield a significant payoff, both in reduction of operating expenses and in the creation of new revenue from IP-based services.

"LTE faces competition from other broadband wireless technologies and it will need to demonstrate clear technical and economic advantages to convince network operators," says ABI Research analyst Ian Cox. "WiMAX has a two-year lead over LTE but suffers from not being backwards-compatible with current 3G technologies. LTE will not only be backwards-compatible with UMTS but is likely to be used to upgrade CDMA networks as well. But the industry is also working on HSPA+, which could offer the same performance in a 5MHz bandwidth. Without additional spectrum, operators face a difficult choice."