Impact of Internet to Wireless Network Construction Business – Case Finland

1. Presentation Impact of Internet to Wireless Network Construction Business – Case Finland Master’s thesis presentation Jim Mäkelä 11.4.2007 Supervisor: Prof. Hämmäinen

2. Presentation Outline • Introduction • Research Questions and Scope • Methodology • Thesis Structure • Technologies • WLAN • WiMAX • UMTS • Summary • Further study

3. Presentation Introduction • The landscape of the communication business is changing with the introduction of new wireless broadband technologies that provide internet access to places where the wired network does not. The network operators are outsourcing their construction and maintenance activities to specialised companies.

4. Presentation Research Questions and Scope • What kind of potential each examined technology platform shows from the construction and maintenance point of view? • What kind of service would offer opportunities to construction and maintenance company? • Scope is limited to WLAN, WiMAX and UMTS • In Finland • Time scale 2007 - 2009

5. Presentation Methodology • The research method: • Interviews • 17 industry experts • Literature • Value net, game theory • Communications seminar

6. Presentation Thesis Structure Theory Technologies Regulation Networks and services Conclusions

7. Presentation WLAN • Further large scale deployments unlikely • Installation potential in office deployments • Full coverage and integration still rare • Speed increases likely to decrease range • Many viewed the existing hotspot as an advantage to deployment of UMTS services • When using services packages with monthly billing contract • Using the free hotspot –> less congestion

8. Presentation WiMAX • Fixed WiMAX is not a threat to UMTS • Aimed for ADSL replacement in rural areas • 1000+ base stations going to be deployed • Only regional frequency licenses • Most cases depend on public investment support • Majority to existing GSM/UMTS sites • Promising backhaul technology for security and control services

9. Presentation WiMAX cont. • Mobile WiMAX commercial launch 2008 • Direct competitor to UMTS from technology point of view • Commercial competition depends who gets the frequency allocations • Best case would be to existing operators to relieve congestion in UMTS -> NRA wants more competition? • For success a new operator would need to make massive investments to coverage • Country wide frequency allocation essential

10. Presentation UMTS • The success of tie-in sales have accelerated the coverage investments • Noticed among the equipment vendors • 350000 subscriptions as of December 2006 • Elisa has biggest market share -> incentive to make largest investments • DNA has HSDPA as the wireless broadband solution -> need to have significant coverage • TeliaSonera strategy with GSM has been best coverage

11. Presentation UMTS cont. • HSDPA offers broadband connectivity • Coverage is increasing • 70% population coverage by the end of the year • About 9750 new base stations by the end of 2009 • Minority are new sites -> much cheaper to build in existing sites

12. Presentation Summary • The WLAN potential is in offices • Large scale outdoor deployments unlikely • Hotspots do not take much revenue from 3G • WiMAX is not a great threat to 3G • Fixed WiMAX used for ADSL replacement in rural areas • Mobile WiMAX to bigger cities to help with network congestion • UMTS has the largest deployment

13. Presentation Further study • Further research would be needed on the personnel impact • The development of end-user devices • The future division of expenses between core and radio network

14. Presentation Questions?