Comparison of W-CDMA and cdma2000

Contents Executive Summary Introduction Understanding the technologies A comparison of W-CDMA and cdma2000 Upgrading your existing network towards 3G Economical advantages of W-CDMA Siemens value proposition Conclusion Glossary 2 3 4 6 9 10 11 11 12

Executive Summary

Data services are becoming more and more dominant and the race towards 3G mobility has already begun. 2G operators are looking for the best technology and the most lucrative road to this destination. UMTS, consisting of W-CDMA and TD-SCDMA, is the most promising 3G candidate, proposed by the GSM community, whereas cdma2000 is the alternative 3G approach emerging from the IS-95 path. This Siemens White Paper reviews and discusses these two 3G technologies from a variety of perspectives such as air interface performance, costs, and ease of evolution. The comparative investigation of these 3G alternatives reveals that system capacities are more or less in the same range, with slight advantage of W-CDMA when using comparable transmission technologies and channel conditions. This advantage of W-CDMA mainly results from the higher coverage of high-bit-rate services. cdma2000s 1xEV systems are technologically exhausted when capacity is concerned, while W-CDMA still holds potential by introducing HSDPA.

Moreover, the investigation shows that the cdma2000 evolution is not as clean and cost efficient as often claimed. There is an obvious break between 1xRTT and 1xEV-DO regarding compatibility of the radio transmission technologies and the network topology, which requires a separate overlay network with massive additional investment costs. However, the most striking factors for the right 3G choice are economic aspects like economies of scales, terminal cost as well as the geographical footprint for global roaming facilities. From those perspectives, GSM and its successors are clearly making the race, and the smooth 2G-3G migration strategy also offers a gradual capital investment in line with the continuously increasing data throughput demands. Thus, the GSM/GPRS/EDGE/ W-CDMA path appears to have significant advantages by providing immediate and long-term revenue and profit opportunities for GSM, TDMA, and even IS-95 operators.

The best choice towards 3G: W-CDMA

Introduction

Wireless operators are looking for the right choice to upgrade their 2G networks to 3G, dealing with upcoming data and non-voice related services (circuit and package switched) more efficiently. Today, the mobile user is used to setting up a voice call anytime and anywhere. Tomorrow, he will expect the same flexibility for access to Internet and multimedia services. Mobile applications will have to evolve to todays realities of wired data communication (e.g. high speed wired Internet access via xDSL). Based on the IMT-2000 requirements for 3G systems, five terrestrial air interface standards have been approved. EDGE and UMTS with W-CDMA as FDD mode and TD-(S)CDMA as TDD mode are the three standards developed by 3GPP Introduced as multi. carrier CDMA (MC-CDMA) and currently standardized in 3GPP2, cdma2000 is the competing 3G approach from the IS-95 camp. An upgraded DECT version is the fifth standard.

Operators in Europe have secured new 3G spectrum and have extended their GSM network to the packet switched GPRS system. They are already on the migration path towards W-CDMA. However, the situation in the Americas differs from Europe and the rest of the world due to multiple competing 2G radio technologies and in particular the strong political impact of the CDMA (IS-95) community. With the decision of the UWCC to desist from the UWC-136HS approach, the TDMA operators have the choice of 3G evolution: They can either choose as already done by AT&T Wireless and Cingular to migrate to 3G through the GSM family ending up in EDGE and later in W-CDMA technology, or they can consider the cdma2000 family.

The best choice towards 3G: W-CDMA

Understanding the technologies The cdma2000 family The cdma2000 system consists of several branches or phases to support additional enhanced services in terms of increased voice capacity or packet-oriented data services. In general, cdma2000 is a multi-carrier approach for n times 1.25 MHz carriers operating in FDD mode. But the standardization work is focused on a single 1.25 MHz carrier solution (1x) with the same chip rate as IS-95. cdma2000 1xRTT The first phase of cdma2000, variously called 1xRTT, 3G1x, or just 1x, is designed to improve voice capacity of IS-95b (cdmaOne) and to support data transmission of up to 307 kbps peak rate. .2 However, the first commercial 1x terminals will only allow 153.6 kbps peak data rate. Improvements over IS-95 are achieved with the introduction of some advanced technologies such as QPSK modulation and turbo encoding for data services as well as a fast (800 Hz) downlink power control and transmit diversity. cdma2000 1xEV-DO 1xEV-DO, conceived from Qualcomms HDR (High Data Rate), was ratified under this name as a 3G standard in August 2001 and signifies an evolution of the single carrier solution for exclusive packet data transmission. The philosophy behind this system is splitting voice and high-data-rate services into different carriers. 1xEV-DO can only be realized as a data overlay network that requires a separate carrier. In order to use both voice and packet calls Knowing about the vastness of resources of 1xEV-DO resulting from a fixed separation of the resources for data and voice while traffic and service mixes are temporarily varying, the CDG (CDMA development group) initiated a the third phase of cdma2000 bringing voice and data services back into one 1.25 MHz carrier and retaining once more the backward-compatibility to 1xRTT. The downlink baseline framework of 1xEV-DV is be based on the L3NQS (LGE, in such an overlay structure, dual mode 1x and 1xEV-DO devices are needed. The downlink transmission technique is not compatible with 1xRTT. 1xEV-DO is employing a shared channel approach in downlink in a TDMA-based manner, i.e. downlink packet transmission is time multiplexed within slots of 1.67 ms length. Only a single user is served at any instant and thus maximum transmission power of the base station can be spent to one single user. The CDMA technology, including soft handoff, is suspended in downlink. Theoretically, downlink peak rates of up to 2.4 Mbps can be achieved using high-value modulation schemes (16QAM), best base station selection, turbo encoding, and exclusive usage of the time slot with maximum transmission power in close base station proximity. The uplink with data rates up to 153.6 kbps is kept according to cdma2000 1xRTT. cdma2000 1xEV-DV LSI, Lucent, Nortel Networks, QUALCOMM, and Samsung) proposal. The maximum user data announced for L3NQS is up to 3.1 Mbps corresponding to the data packet size of 3840 bit with 1.25ms transmission duration. Qualcomm proposed a modification of the existing packet sizes to increase the RLP efficiency with lower overhead, but this is also still being discussed. Although the principal transmission technique has been identified, there are still multiple component technology proposals pending for inclusion in the final 1xEVDV downlink specifications. The final 1xEV-DV specifications are expected to be ready for publication in all SDOs by mid 2002. cdma2000 3x (MC-CDMA) cdma2000 3x, or 3xRTT, refers to the original multi carrier (MC) option of the cdma2000 radio configurations and is termed as MC-CDMA (IMT-MC) within IMT-2000. It involves the use of 3 1x carriers to increase the data rate and is designed for a 5 MHz frequency band (3x 1.25 MHz channels). The multi carrier option is only applied in the downlink transmission direction. The uplink is directly spread, similar to W-CDMA with a slightly lower chip rate of 3.6864 Mcps (three times 1.2288 Mcps). This approach has recently become less significant due to the definition of the 1xEVolution branches. A commercial deployment of 3xRTT is currently not planned and, therefore, not regarded in this analysis paper. The GSM / UMTS family GPRS GPRS (General Packet Radio Service) is a 2.5G radio system, but a 3G system in terms of the core network. It enhances GSM data services significantly by providing genuine end-to-end packetswitched data connections, offers data transmission speeds up to 171.2 kbps (peak data rate) and supports the leading Internet protocols TCP/IP and X.25. The integration of GPRS into GSM is a rather straightforward process. A subset of time slots on the air interface are defined for GPRS allowing scheduled packet data multiplexing of several mobile stations. The base station subsystem needs a minor modular upgrade associated with the packet control unit (PCU) to provide a routing path for packet data between the mobile terminal and gateway node. A minor software upgrade becomes necessary to employ the different channel coding schemes. The GSM core network constructed for circuit-switched connections has to be extended with new packet data switching and gateway nodes, the so-called GGSN (Gateway GPRS Support Node) and SGSN (Serving GPRS Support Node). However this acquisition endures the migration towards 3G, since the high-speed packet switching core network provided by GPRS and EDGE can be used for UMTS almost

The best choice towards 3G: W-CDMA

completely and, therefore, represents a secure investment for the operator. GPRS is a mature technology and a fully standardized solution with open interfaces. EDGE EDGE (Enhanced Data rates for Global Evolution) is an approved 3G transmission technique that can be deployed in existing spectrum of TDMA and GSM operators. EDGE reuses the GSM carrier bandwidth and time slot structure and was designed to enhance user data rates of GPRS or HSCSD by using higher-level modulation schemes and other advanced technologies such as incremental redundancy. Thus, EDGE-capable infrastructure and terminals are fully compatible with GSM and GPRS. Due to adaptive modulation/ coding schemes optimal bit rates are achieved for all channel qualities. The maximum user peak data rate that can be achieved in a 200 kHz carrier with the most sensitive modulation/coding scheme and combining of all 8 timeslots is 473.6 kbps.

W-CDMA or UMTS/FDD W-CDMA (Wideband Code Division Multiple Access) is the radio interface technology of UMTS for paired band operation. It operates in FDD mode and is based on the direct sequence (DS) spread spectrum (CDMA) technology using a chip rate of 3.84 Mcps within a 5 MHz frequency band. A higher bandwidth and higher spreading provide an increase of processing gain and a higher receiver multi-path resolution, which was a decisive point for the IMT-2000 bandwidth fixing. W-CDMA fully supports both circuit and packet-switched high-bit-rate services and ensures the simultaneous operation of mixed services with an efficient packet mode. Moreover, W-CDMA supports highly variable user data rates based on the rate matching procedure, where data capacity among the users can change from frame to frame (frame length 10ms) as demonstrated in Figure 1. The current W-CDMA standard is equipped with QPSK, a more robust modulation scheme than 8-PSK, which provides a peak data rate of 2 Mbps with

good transmission quality in a large coverage area. W-CDMA is the new radio transmission technology with a new radio access network (RAN) called UTRAN, consisting of the network elements RNC (radio network controller) and NodeB (name for base station in UMTS). But it should be noted that the GPRS/EDGE core network can be reused, that multi-mode terminals capable of supporting GSM/GPRS/EDGE and WCDMA are specified, and that handover and cell re-selection will be established between these systems. UMTS/TDD With increasing shortage of spectrum it may be more likely that unpaired spectrum blocks can be cleared and, therefore, TDD systems may become more important in the near future. The IMT-2000 standard for TDD, called IMT-TC, defines two types of air interfaces: UTRA-TDD and TD-SCDMA. Within 3GPP they are standardized as TDD hcr (high chip rate) and TDD lcr (low chip rate), respectively. Both technologies use a hybrid access technology combining TDMA and CDMA.

The consequent harmonization of the TDD transmission techniques with W-CDMA and the efficient usage of the existing unpaired bands make the TDD-based standard (IMT-TC) of the IMT-2000 family, an interesting proposition for wireless operators, and Siemens offers both UMTS modes, FDD and TDD, in its product portfolio. HSDPA All the advanced transmission technologies such as adaptive modulation and incremental redundancy are not exploited in W-CDMA yet. Therefore, the next logical evolutionary step of W-CDMA in terms of higher downlink data rates is being standardized in 3GPP with the working title HSDPA (High Speed Downlink Packet Access). HSDPA will improve the average throughput of the cell and, furthermore, the end user access speed of up to 10 Mbps. This upgrade in terms of advanced transmission technologies is comparable to those from GPRS to EDGE or from 1xRTT to 1xEV-DV, respectively. HSDPA is fully compatible with current 3GPP releases and the standard has been completed in the Release 5 (R5) timeframe.

Power

Low-bitrate user High-bitrate user

Frequency

5 MHz frame 10 ms

Time

Variable bit-rate user due to variable spreading

Figure 1: Variable bandwidth allocation in W-CDMA

The best choice towards 3G: W-CDMA

A comparison of W-CDMA and cdma2000 Only the cdma2000 1x single carrier system with its various evolution phases is used for comparison here, since the multi-carrier approach has been relegated from the cdma2000 evolution path (Figure 6). Both W-CDMA and cdma2000 meet the overall technical requirements set forth by the IMT-2000 including the support of high-bit-rate multimedia services, packet data and IP access. Also the radio transmission technology of both systems is based on DS-CDMA as multi user access technology, but there are also some basic differences: Main differences Chip rate W-CDMA uses more than three times the bandwidth and chip rate of the cdma2000 1x evolution family. Hence, the higher chip rate of 3.84 Mcps in W-CDMA gives more multipath diversity, especially in small urban cells. Multi-path diversity combats critical fades and improves coverage. The higher chip rate furthermore provides higher trunking gain and smaller signaling overhead, especially for high-bit-rate services. The higher the bandwidth, the better the coverage for high-data-rate services of 384 kbps and beyond. This is why the wider bandwidth of 5 MHz has been chosen for IMT-2000. Moreover, the higher chip rate improves the receivers ability to resolve multi-path effects. Cell site synchronization As in the IS-95 system the cdma2000 base stations are synchronized typically via GPS. The need for a GPS signal makes the deployment of the indoor and small urban (with antenna below rooftop) cells rather difficult as GPS does not work properly without line-of-sight connection to the satellites. In contrast, W-CDMA is designed to operate with asynchronous base stations (node B). TDM access for 1xEV-DO The 1xEV-DO system employs a shared, time-multiplexed downlink where only a single user is served at any instant, i.e. an introduction of a strict TDMA technology in order to avoid power sharing and multiple access interference (MAI). This approach allows an operation at maximum output power in downlink needed for very high peak rates. This downlink channel structure with fixed timeslots for shared access is different to IS-95 / cdma2000 1x and means a break of the physical layer compatibility. In uplink still CDMA is applied as for 1xRTT. Mixed services 1xEV-DO is a data-only solution designed as overlay for cdma2000 1x systems, i.e. it needs a separate 1.25 MHz carrier for data services. In mixed service scenarios this separation of resources may result in an inefficient spectrum usage (Figure 2). For instance, a low loaded carrier reserved for data only cannot be used for voice traffic. W-CDMA in contrast is very flexible in handling mixed voice and data services. Therefore, the next cdma2000 phase 1xEV-DV was initiated to overcome this drawback. Power control frequency A fast closed-loop power control solution is applied to both systems in both transmission directions. However, in W-CDMA power control is almost twice as frequently executed with a rate of 1500 times per second (1.5 kHz) as cdma2000, which uses 800 power control updates per second. The faster the power control is, the better the needed signal quality can be guaranteed and the more users can be admitted. Common channel overhead The power consumption of the common channels (e.g. pilot, sync and paging channels) have an impact on the coverage area of the base station and, therefore, on the system capacity. While the downlink pilot structure of W-CDMA is based on dedicated and common pilot symbols, cdma2000 1x is based on a common continuous pilot sequence.The pilot channel of cdma2000 needs about 20% of the total downlink transmission power in contrast to W-CDMA with about 10%. Moreover, due to the wideband nature of W-CDMA the common channels require proportionally less capacity than needed in cdma2000 and the traffic channels experience higher trunking gain efficiency. Underlying core network The UMTS core network is logically separated into circuitswitched and packet-switched domains. The circuit switched domain basically corresponds with GSM networks deployed in Europe and throughout the world utilizing a mobility management protocol defined as GSM Mobile Application Part (GSM-MAP). The packet-switched domain utilizes the GPRS core network with the two basic infrastructure nodes GGSN and SGSN and is based on Internet Protocol version 6 (IPv6) (Figure 3). GPRS subscription data and routing information is held in a common HLR that is shared between GPRS and the circuit switched functions of GSM. As UMTS shares a common packet core with GPRS/EGDE, all services like billing, security,

cdma2000 1x and 1xEV-DO Three 1.25 MHz 1x Data 1x Voice 1x Voice Time Speech blocking
Source: NOKIA

W-CDMA

One 5 MHz

Time Unused capacity voice

Reduced data throughput data

on the traffic mix

Optimal adaption

Figure 2: Handling of mixed voice/data traffic in an overlay network of cdma2000 1x and 1xEV-DO in comparison to W-CDMA

The best choice towards 3G: W-CDMA

and roaming deployed to support GSM-based GPRS services will also support W-CDMA services. Figure 4 illustrates the underlying network for cdma2000 1x. The circuit-switched domain utilizes the same core network elements around the Mobile Switching Center (MSC) as GSM running a different mobility management protocol called ANSI-41. Since packet services in IS-95 have been realized as short circuitswitched connections, an inter-working function (IWF) is required between MSC and Internet. However, this solution is not practicable for higher bit rates served in the upcoming third generation. To complete the new cdma2000 1x data/voice network, additional network elements have to be added. The anchor point in a private IP-centric environment is the so-called PDSN (Packet Data Serving Node), which terminates the point-to-point protocol (PPP) data link with mobile terminal and is connected via the radio packet (R-P) interface to the base station subsystem (BSS). The PDSN is also responsible for the mobility management and

acts as a foreign agent (FA) for Mobile IP (MIP) functionality. A home agent (HA) is needed to terminate the IP tunnels initiated by PDSN/FA and to maintain the MIP session. An AAA (Accounting, Authentication, and Authorization) server, which is based on Remote Authorization Dial-In Service (RADIUS), contains the subscriber packet-dataprovisioning information and is used for authentication. The packet control function (PCF) is one of the new entities within the BSS needed for upgrades to support the packet-switched network via the R-P interface. The dataonly version (1xEV-DO) does not use the R-P interface to the radio access point and needs additional network elements as the 1xEV-DO access router. The evolution to 1xEV-DO requires a second overlay network with once more new radio equipment, the 1xEV-DO access points (AP), which employ a TDM access scheme in downlink and CDMA in uplink. It is called access point, since it also contains functionalities beyond a 1xRTT base station transforming the received RF signals into IP

communications that are forwarded to the access router (another new network element needed in the core domain). It receives and aggregates IP-encapsulated information and routes traffic to PDSN. Moreover, a server is necessary to provide network control services, which again are required to operate a network of access points.

used to highlight a technology are theoretical and will be never reached in a cellular environment. Thus, peak date rates are of small importance for the operator. Throughput is defined as the amount of data transferred successfully from one place to another in a given time period, e.g. for the packet call duration or a complete WWW session. For instance, the throughput decreases if packets need to be retransmitted several times. System capacity is the most interesting performance issue for the network operator. It is the average throughput for all users in a multi-cellular environment taking traffic loading, interference and noise impairments into account, associated to the bandwidth, which is needed to operate the mobile communication system over the complete serving area (sum of all carriers in case of frequency reuse). As system capacity increases due to advanced radio transmission technology and radio resource management schemes, each cell site can handle a higher traffic volume, and that in turn results in a

Performance issues Peak rate, throughput and system capacity The terms "peak rate and "throughput are solely related to packet switched data services. For a circuit switched connection the bit rate is constant and exclusively assigned for the user during the complete call duration. Peak rate is the maximum transmission speed a connection may experience under ideal conditions, i.e. one user can exclusively use all resources of one cell without any interference and noise restrictions, and most important only a momentary time instance is regarded. One should be aware that the dazzling peak data rates often

Core Network 2.5G Radio Access Network MSC/VLR A MSC/VLR MAP-D Iucs Gb 3G Radio Access Iups Network Gs SGSN Gr HLR PSTN / ISDN 1xRTT Radio Access Network R-P Internet, x.25, private networks 1xEV-DO Access Points A ANSI-41 HLR

Core Network PSTN / ISDN IWF HA PDSN FA Private IP network Internet

Gc GGSN

Gn

1xEV-DO AR

AAA (RADIUS)

Figure 3: GPRS / W-CDMA core network architecture

Figure 4: cdma2000 1x core network infrastructure

The best choice towards 3G: W-CDMA

higher revenue streams and higher return on operators investment spent for radio infrastructure (cell cites) and spectrum acquisition.

Evaluation results Due to the different required bandwidths, a W-CDMA system cannot directly be compared to cdma2000. However, a comparable situation exists when three 1.25 MHz cdma2000 carriers are deployed in 5 MHz bandwidth. As described above, there are some basic technical differences between the W-CDMA and cdma2000 such as chip rate, power control, and common channels that attest W-CDMA a better system performance. But there are also other comprehensive, multi-cellular system aspects that have an impact on system capacity. Those capacitydetermining aspects can only be derived from dynamic, multi-cell system-level simulations, which are rather computing-intensive, even for packet data. Results from computer simulations with realistic channel and propagation models in a

multi-cellular environment show that the system capacity of the different 3G standards that are currently available is located in the same range. Figure 5 shows the capacity figures for non-real-time (NRT) data services (like Internet browsing) in a 5 MHz deployment. The good system performance of EDGE on one hand results from its TDMA nature through the back-door introduced in 1xEV-DO as well and on the on the hand from advanced features such as incremental redundancy and link adaptation, which will be implemented in HSDPA, the W-CDMA evolution step. These performance figures can still be improved when applying more sophisticated radio transmission technologies to both W-CDMA and 1xEV, but it is very likely that they will remain in the same order. However, in terms of mixedvoice and data traffic, W-CDMA will clearly be superior. All in all, the system performance will not be the dominant factor that will affect the operators decision about the right technology. Other quite important aspects such as market issues, terminals, applications, service creation platforms, etc. may play a striking role in

building a successful business model for a 3G network. Evolution of the standards Figure 6 shows that all major 2G standards with exception of IS-95 have selected EDGE/ W-CDMA as their 3G path indicating a EDGE/W-CDMA market share of more than 85% (see also Figure 9). GSM is the 2G system with the highest penetration worldwide and its pathway towards 3G clearly defined over GPRS (EDGE) towards W-CDMA is therefore becoming the most popular evolution route. Since the core network is enabled for packet switching with GPRS or EDGE by integrating the corresponding network elements (i.e. SGSN and GGSN), they may represent the natural but not mandatory intermediate step towards W-CDMA. EDGE, an improved GPRS radio technology for high data rates, is approved as a 3G standard and as the best way to serve 3G services in existing 2G spectrum resources. The new 3G technology W-CDMA will not necessarily replace the previous ones, but will in fact co-exist with them. In January 2000, the IS-136 (TDMA) operators, represented

by the Universal Wireless Communication Consortium (UWCC), decided to desist from a separate 3G path and to work together with the GSM camp for EDGE data evolution based on GPRS. Thus, they will transit over GPRS-capable networks to EDGE and afterwards on to W-CDMA when having additional 3G spectrum. In Japan, W-CDMA has been set-up as a stand-alone system in the first role out. Dual-mode PDC/W-CDMA handsets have been ordered, however they will only be applicable for roaming and not for handover as it has been planned in co-existing GERAN/W-CDMA networks. For the IS-95 community, the transition to 3G and the delivery of higher data rates will be met with 1xRTT and the 1xEV technologies. The forking of the path behind 1xRTT indicates that 1xEV-DV, the final version that once more combines data and voice, is not a real evolution from the data-only version (1xEV-DO), but a effort to find back to the 1x compatibility. 1xEV-DO consists of a different air interface optimized for non-real-time packet data.

400 350 kbps/MHz/cell 300 250 200 150 100 50 0

PDC TD-SCDMA

UMTS

HSDPA GSM GPRS W-CDMA

TDMA IS-95 cdma2000 1xRTT EDGE W-CDMA HSDPA cdma2000 1xEV-DO 1xRTT

EDGE 1xEV-DV 1xEV-DO

Source: Siemens (BASED ON ITU-R)

Figure 5: Downlink system capacity for NRT packet data transmission for different radio technologies in a 5 MHz deployment

Figure 6: 3G evolution of the different standard

The best choice towards 3G: W-CDMA

Upgrading your existing network towards 3G GSM operators on the track towards W-CDMA The GSM operators are already on the right track towards W-CDMA when deploying GPRS, which introduces packet-switching capabilities. Building the GPRS infrastructure is fast and costefficient as it is basically an add-on to the GSM network. The capabilities and system performance of the GSM/GPRS networks can be enhanced by further introducing EDGE and within new IMT-2000 frequency bands W-CDMA. The GSM/GPRS packet core network becomes the basement for W-CDMA in order to deliver the full set of 3G services and applications. TDMA operators migrating towards W-CDMA The first step in this evolution strategy is the migration to GSM/GPRS. Of course, the operator can start with each evolution phase, but the advantage of a smooth migration is a reduced and staged investment adapted to the continuous increase of bandwidth demands. Figure 7 shows the evolution steps from TDMA to W-CDMA both for the core and radio access part together with the corresponding new equipment acquisitions as well as upgrades indicated by the arrows "new and "modified . A GSM/GPRS overlay network requires new equipment in core and radio domain while EDGE only comprises software upgrades. Due to the change in radio technology, the migration step to W-CDMA needs a HW upgrade with new radio access network elements. However, the core network is consistent with GPRS. TDMA operators choosing cdma2000 In spite of the UWCC endorsement for the EDGE/ W-CDMA migration the TDMA operator may principally also choose the cdma2000 track. Which of the new equipment acquisitions and upgrade possibilities will lay before him? Comparing the migration to cdma2000, it is evident that the migration path is not as cheap and, in particular, the 1xEVolution is not as smooth as often claimed (Figure 8). To install a cdma2000 1xRTT overlay network, a complete new radio and packet core equipment is needed. Furthermore, the MSC, running the same IS-41 mobility management protocol, must be upgraded. Obviously, this fact does not offer appreciable savings for the operator, as the major costs stem from the purchase of radio equipment. A notable new investment is needed in both radio and core domain when installing 1xRTT and once more when evolving from 1xRTT towards 1xEV-DO. The different air link, the missing R-P interface to PDSN, and the philosophy of separating data services require a second overlay network. Thus, new 1xEV-DO access points are needed on the radio side, and new 1xEV-DO access routers together with a control server are required in the core domain. A third notable investment will arise through further migration to 1xEV-DV. So it is estimated that the GPRS/ EDGE/W-CDMA radio and packet core upgrade will be about 30% cheaper than the 1xRTT/1xEV-DO1xEV-DV upgrade for both TDMA and CDMA operators. The IS-95 operator Regarding the limitations of IS-95 in terms of inter-frequency handover and reduced roaming capabilities as well as the moderate performance of cdma2000 1xRTT in some practical environments (e.g. for fast moving users or in indoor deployments due to missing GPS connection), IS-95 operators should also consider an early shift to the GSM/EDGE/W-CDMA path. For an upgrade to cdma2000 1xRTT, the IS-95 operator has to raise almost the same investment for acquiring new network equipment. There are several new packet core elements such as PDSN/FA, AAA-server, and HA in combination with the R-P interface in the BSS, which replace the IWF New channel cards are . required at the base station to provide new radio configurations that include variable spreading, variable coding, and code aggregation. Since new network elements are needed in any case to install a packet-switched core network, the economies of scale associated with GSM hold an interesting pricing proposition for an affordable shift towards GSM/GPRS.

Core TDMA New

Complete core network* Minor SW upgrade SW upgrade Iu I/F for MSC and SGSN Node B RNC

RAN Modified New

BTS BSC** SW upgrade

Core Modified TDMA New

Complete packet core network* EV-DO access router Control Server

RAN Modified
MSC upgrade PDSN upgrade

New
BTS BSC including RCF and R-P I/F EV-DO access point**

GSM/GPRS

1xRTT

EDGE

1xEV-DO

W-CDMA Migration

or

UMTS CU***

1xEV-DV Migration

Standardization is in progress. 1xEV-DV is not an evolution from 1xEV-DO big changes * PDSN, AAA, HA/FA, DCN ** contains BTS, BSC and partly MSC functionality

* packet and ** Collocation with *** in BTS prepared for circuit switched TDMA BSS possible GSM/UMTS Collocation

Figure 7: GERAN/W-CDMA Migration forTDMA operators

Figure 8: cdma2000 migration forTDMA operators

The best choice towards 3G: W-CDMA

Economical advantages of W-CDMA Building on success of GSM GSM has become the most popular standard in the world, with more than 646 million subscribers (January 2002, source GSM Association) in 400 networks in 171 countries worldwide. Based thereupon, it is also apparent that UMTS, the 3G evolution of GSM (based on W-CDMA for FDD) will be the globally most accepted standard for 3G mobile communications. With the recent migration of TDMA operators (e.g. Cingular, AT&T Wireless) to GSM, developing their 3G network evolution based on EDGE and the conversion of IS-95 operators (e.g. MobileOne (Singapore)), the number of subscribers associated with the GSM/GPRS/EDGE evolution to W-CDMA is reaching 85% of all cellular subscribers in the near future (Figure 9). The GSM market success is also a result of its standardization success ensuring interoperability of terminals and infrastructure. These standards allow operators to select radio equipment offered by a number of competing vendors. Moreover, GSM is operable in all open 2G frequency bands, 800, 900, 1800 and 1900 MHz, which supports global network deployments and global roaming for subscribers. Both voice and data services can roam with the subscriber, which becomes important when considering the increasing amount of SMS associated with increasing operator revenue. buy services that can be applied anywhere in the world and will thus drive up the customer base. Also, depending on the broad coverage, applications and services for EDGE/W-CDMA systems will be the first in the market while resulting in a highly competitive pricing system for subscribers. W-CDMA the dominant 3G technology throughout the world In Japan the W-CDMA rollout has already started in October 2001 and it is evident that W-CDMA will be deployed in Europe in the near future. More and more non-GSM operators are joining the GSM/W-CDMA alliance. After AT&T Wireless chose to move towards GPRS/EDGE, Cingular also announced to consolidate its TDMA network with an EDGE data-capable overlay network. In the U.S.A., the way to W-CDMA will be paved as soon as one of these operators can add spectrum to its existing capacity in the upcoming US 3G auctions. The roll out will be a lot easier as EDGE and W-CDMA work off the same general core network. Even IS-95 operators like MobileOne in Singapore have indicated intentions to convert to the GSM/W-CDMA alliance. MobileOne is planning to shut down its entire CDMA network and offer GSM services to its customers while possibly evolving towards W-CDMA.

Economies of scale GSM has established unmatched economies of scale, which have become a major element in driving down the cost of infrastructure and terminals. For sure, its evolving products will tremendously benefit from this fact as well, as the volume of devices and infrastructure equipment will most likely reach the same order. The dominant market share and the huge footprint of GPRS/EDGE/W-CDMA will drive down the prices for infrastructure equipment and terminals. Affordable handset prices and services will be necessary for a widespread mass market. The broad coverage of GERAN/ W-CDMA will generate yet a another positive momentum: more end users will want to

Number of subscribers (millions)

1600 1200 800 400 0 1999

TDMA GSM/GPRS/ EDGE/W-CDMA PDC IS-95/cdma2000 Analog

2001

2003

2005

Source: GSA
Figure 9: Global cellular subscribers per technology

The best choice towards 3G: W-CDMA

10

Siemens value proposition Siemens mobile is number three in the world for GSM networks and has over 180 GSM customers in over 90 countries more than any other supplier of infrastructures. Siemens mobile is also in an excellent position in the race for 3G awards and has contracts with all major global mobile network operators. Cingular Wireless, the second largest operator in the U.S., has chosen Siemens as its infrastructure supplier for a significant portion of the GSM/ EDGE network. Under the terms of this contract, Siemens will supply GSM/GPRS/EDGE radio network equipment. Furthermore, Siemens is developing dual-mode TDMAGSM handsets to guarantee a seamless usage of both networks by Americas end-users. In 3G market share terms, Siemens mobile holds position three when regarding the number of contracts weighted by country population (Figure 10). Due to the partnership with NEC, W-CDMA expertise and development resources can be pooled while reducing both costs and time-to-market of 3G infrastructure. Siemens mobile has several trial systems and two quasi-commercial UMTS networks in operation in Monaco and Isle of Man. Siemens mobile networks group is a premier player in radio and core networks for all generations of mobile communication systems. Moreover, it is also operating in the top categories solutions and devices, allowing Siemens mobile to provide a complete solution package to operators migrating optimally towards 3G.

Conclusion

Almost all practical issues such as performance, costs and ease of evolution, which can make or break a business case have been discussed. The GSM/EDGE/W-CDMA approach shows clear advantages in the race while providing significant revenue and profit opportunities for GSM, TDMA, and regarded objectively also for IS-95 operators. The system performance derived from network capacity, which by the way is the operators pivotal issue, is comparable with both 3G technologies W-CDMA and cdma2000 1xEV. In respect to the coverage area, W-CDMA is clearly superior to the 1xEV family by supporting high-bitrate services and hence requiring guaranteed QoS (Quality of Service). With tuning downlink packet transmission (HSDPA), W-CDMA has additional potential to provide capacity and access speed enhancements over cdma2000. But there is also a number of other advantages that make W-CDMA and EDGE the optimum technology choices for 3G networks.

Another system performance criterion considered by the consumer is global roaming: GSM/EDGE/W-CDMA, together with TDMA in America, is clearly superior due to its worldwide dominance. EDGE is the coupling technology of GSM and TDMA. EDGE is the best 3G choice for operators to deploy existing spectrum allocations and W-CDMA for new IMT-2000 or re-farmed spectrum. The broad coverage of the GSM/EDGE/W-CDMA technology offers the opportunity to leverage powerful economies of scale driving down network build-out and management costs as well as guaranteeing reasonablypriced handsets. Global roaming and the possibility to use services anywhere in the world will especially appeal customers to subscribe these 3G services, and at the same time drive up customer base, delivering higher economies of scale as well as reducing costs and prices. It is evident that all these factors will deliver a greater benefit and value to customers and operators.

Alcatel 7% Nortel 17%

Lucent 4% Ericsson 29%

Motorola 2% Siemens 19% Source: Yankee Group

Figure 10: Percentage of 3G market share

Nokia 22%

The best choice towards 3G: W-CDMA

11

Glossary and abbreviations 1xEV-DO 1xEV-DV 1xRTT Evolution of cdma2000 operating with one 1.25 MHz RF carrier for data only Evolution of cdma2000 operating with one 1.25 MHz RF carrier integrating voice and data The first cdma2000 phase as upgrade from IS-95 for providing 3G services in one 1.25 MHz RF carrier. Second generation of cellular mobile systems. In contrast to first generation systems based on digital transmission technique and primarily designed for voice communication. Typical 2G radio systems are GSM, IS-95, and D-AMPS. Third generation of mobile communication system featuring higher data rates (up to 2 Mbps) and packet switched services for wireless Internet. 3G radio standard are for instance W-CDMA and cdma2000. Third Generation Partnership Project Third Generation Partnership Project 2 Advanced Mobile Phone Service; US analog standard Code Division Multiple Access Digital AMPS; 2G US radio standard based on TDMA Enhanced Data Rates for GSM/Global Evolution Frequency Division Duplex GSM EDGE Radio Access Network General Packet Radio Service Global Standard for Mobile; worldwide 2G radio standard Gateway GPRS Support Node High Speed Downlink Packet Access; advanced W-CDMA technology for downlink peak data rate of 10 Mbps. IS-136 Interim Standard #136; 2G US radio standard based on TDMA, also known as D-AMPS Interim Standard #95; 2G US radio standard based on CDMA Multi carrier CDMA; 3G radio standard from cdma2000 family operating with three 1.25 MHz carrier and also referred to as 3xRTT Personal Digital Cellular; Japanese 2G radio standard Standard Development Organization Serving GPRS Support Node Hybrid Time Division / Code Division Multiple Access; 3G radio technology used for operation in unpaired IMT-2000 bands that is referred to as high chip rate UTRA-TDD with 3GPP standardization Time Division / Synchronous Code Division Multiple Access; 3G radio technology used for operation in unpaired IMT-2000 bands that is referred to as low chip rate UTRA-TDD with 3GPP standardization Time Division Multiple Access; primarily a multi user access techniques, but often used as synonym for D-AMPS Time Division Duplex Universal Mobile Telecommunications Systems UMTS Radio Access (Network) Universal Wireless Communications Consortium Wideband CDMA; 3G radio standard that is referred to as UTRA-FDD with 3GPP standardization

IS-95 MC-CDMA

2G

PDC SDO SGSN TD-CDMA

3G

3GPP 3GPP2 AMPS CDMA D-AMPS EDGE FDD GERAN GPRS GSM GGSN HSDPA

TD-SCDMA

TDMA

TDD UMTS UTRA(N) UWCC W-CDMA

Visit our website at www.siemens.com/3G

Order No. A50001-N3-P112-1-7600 Printed in Germany D01402A 06023. Copyright Siemens AG 2002 Information and Communication Mobile Networks Hofmannstr. 51 81359 Munich Germany This publication is issued to provide information only and is not to form part of any order or contract. The products and services described herein are subject to availability and to change without notice. Information contained in this document is subject to change without notice. All other trademarks or registered trademarks are properties of their respective owners. All other companies, product or service names referenced in this brochure are used for identification purpose only and may be trademarks of their respective owners. Data and/or information used in screens and samples output are fictitious unless otherwise noted. Any statements in this document that are not historical facts are forward-looking statements that involve risks and uncertainties; actual results may differ from the forward-looking statements. Siemens AG undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.