Summary
Built around five detailed country case studies of markets where LTE networks have been launched, LTE Business Models: Best Practices in Network Deployment, Positioning and Service Pricing to Maximize Market Opportunity, a new Report by Pyramid Research, examines LTE spectrum allocation and availability, network deployment considerations, product and pricing strategies and LTE adoption trends as well as drivers for market growth. Highlighting what works and what doesn't - based on the experience of commercial operators - this report uncovers the pain points and the keys to success for LTE service providers worldwide.
Key Findings
- The availability of spectrum underpins the timing and scale of LTE deployments and operators' competitive positioning long-term. The importance of access to appropriate LTE spectrum has resulted in high bids for auctioned spectrum, acquisitions of companies with relevant spectrum and loss of 2G market share for the sake of spectrum reframing.
- Adoption of LTE differs depending on the market. As competitive operators reach nationwide coverage, adoption accelerates. To retain their high-value customer bases and keep a network edge, market leaders have to launch LTE first; challengers must minimize this edge and consider disruptive pricing strategies.
Device strategies are important in order to drive upgrades: Ensuring the availability of a range of devices including popular, exclusive as well as low-cost devices that meet operator configuration requirements such as frequencies and backward compatibility with 2G and 3G networks is fundamental.
- LTE device adoption can be maximized by offering low-cost devices, providing financing and annual handset upgrade options, limiting the availability of non-LTE devices if appropriate (particularly among tablets) and offering smartphones that target less technology-savvy customers. Shared-data plans also help drive adoption, and more operators are targeting LTE car connectivity.
- Pricing LTE at a premium has clearly been the right strategy in markets where demand has been strong, thus boosting margins. However, premium pricing comes with downsides and risks, which have been exposed in different markets.
- Driving wide adoption of data-intensive services is crucial to a successful LTE strategy. Relevant services must not only take advantage of LTE's better speeds and performance but also encourage greater data usage to boost ARPS.
- LTE drives data usage, typically increasing consumption by 80-120% compared with 3G.
- LTE can provide an attractive alternative to fixed broadband; just how attractive depends on the market.
- VoLTE will reinvigorate voice services and counter OTT providers, and operator approaches and plans to providing high-quality VoLTE services vary.
Synopsis
This report examines LTE spectrum allocation and availability, network deployment considerations, product and pricing strategies and LTE adoption trends as well as drivers for market growth. Highlighting what works and what doesn't - based on the experience of commercial operators - it uncovers the pain points and the keys to success for LTE service providers worldwide.
The report is structured as follows:
Section 1: LTE technology roadmap, network deployment update and market opportunity. This introductory section outlines why LTE has been successful against alternatives, provides details about the standards and evolutionary roadmap as well as VoLTE readiness, and gives the current global deployment status by frequency band. Also included is Pyramid Research's assessment of the global market opportunity for LTE adoption through 2018.
Section 2: LTE business models and impact on operator KPIs. This core section of the report is a comparative analysis of lessons learned from commercial LTE networks worldwide, looking at network deployments, adoption, devices, pricing, data usage, ARPS (including an in-depth study of South Korea), services, VoLTE and LTE positioning against fixed broadband. The case studies are supplemented by further examples from around the world. The relative performance of market leaders and challengers as well as their respective strategies are examined.
Section 3: Analysis of leading and emerging LTE markets. Five in-depth country case studies analyze the impact of LTE on operators' performance and compare how operators have competed in terms of network deployments, pricing and positioning. The countries covered are Japan, South Africa, South Korea, the UK and the US.
Reasons To Buy
- The “LTE Business Models” report provides a comprehensive examination of lessons learned and best practices from commercial LTE networks in different market environments to help executives develop business plans and product development plans effectively as well as optimize resource allocation and return on investment.
- This report provides a five-year forecast of LTE subscriptions, developed using Pyramid Research's rigorous bottom-up modeling methodologies, to enable executives to effectively position their companies for emerging trends in demand for their products and growth opportunities.
- The report incorporates an easily digestible, executive-level assessment of LTE business models worldwide built around insights directly from the market players, which enables decision makers to quickly get up to speed with the current and emerging trends and make informed investment decisions.
Table Of Contents
Introduction
Report scope and outline
Approach and methodology
Section 1: LTE background and status
4G/LTE technology primer
LTE deployment status
LTE market adoption trends and forecast
Voice over LTE: Technology readiness and operator approaches
Section 2: Analysis
LTE spectrum trends and strategies to improve spectrum availability
Network deployment strategies and best practices
Drivers for LTE adoption and growth
LTE devices and key considerations for service providers
LTE-based services and the role of digital content
Trends in data traffic over LTE
Positioning LTE as a fixed broadband alternative
VoLTE timelines and opportunities for service providers
LTE pricing approaches and best practices
LTE ARPS trends and growth strategies
Market leaders: Go-to-market strategies and best practices
Market challengers: Go-to-market strategies and best practices
Section 3: Analysis of leading and emerging LTE markets
Comparative review of the case study countries
Key takeaways from country case studies
Country case studies
Japan: NTT fails to capitalize on its time-to-market advantage
South Africa: LTE as a fixed-broadband replacement and channel for video content
South Korea: First to market with LTE-Advanced and VoLTE deployments
UK: Challenger MNOs disrupt the market leader's pricing premium
USA: Largest LTE market in the world, where shared data plans have found success
Appendixes
Companies mentioned
Sources and related research
About Pyramid Research
List Of Tables
Report overview
HSPA, LTE and WiMAX comparison
Wireless standards evolution
LTE technology evolution
Number of commercial LTE networks, 2009-2014
LTE commercial networks by frequency band, May 2014
LTE percentage of mobile subscriptions globally
LTE penetration by region, year-end 2013
Examples of spectrum-driven acquisitions
LTE deployment strategies by country, operator position
Quarterly LTE adoption since launch in four markets
Low-cost operator-branded LTE devices
Comparison of service strategies by country
Additional data usage on 4G networks vs 3G networks at five operators
Android smartphone 3G and 4G data consumption globally, Jan 2013 and Dec 2013
LTE impact on fixed broadband
LTE pricing comparison and highlights by country
4G ARPS compared with 3G ARPS at six operators
Blended ARPS in Japan and South Korea, Q2 2012 to Q1 2014
SK Telecom quarterly LTE vs WCDMA data usage, 2011-2013
SK Telecom's 3G and LTE price plans compared
Market share and ARPS performance of five market leaders
Market share and ARPS performance of eight challengers
Overview of mobile markets in five countries
Key country indicators in Japan, 2013 (year end)
Japan market highlights
Key LTE spectrum in Japan by operator
Population coverage of LTE FDD by operator in Japan, Q1 2011 to Q1 2014
NTT network evolution
Service subscriptions of KDDI and NTT, Q4 2013 and Q1 2014
Net FTTH additions of NTT, 2011-2013
Smartphone sales as percentage of handset sales in Japan, 2012 and 2013
KDDI smartphone plans
LTE and smartphone penetration in four countries, Q1 2014
Mobile, smartphone and LTE subscriptions in Japan, Q1 2011 to Q1 2014
3G and 4G data consumption in Japan, Jan 2013 and Dec 2013
Blended ARPS by operator in Japan, Q1 2011 to Q1 2014
Change in subscription market shares in Japan, Q1 2011 to Q1 2014
Key country indicators in South Africa, 2013 (year end)
South Africa market highlights
Number of Vodacom base stations in Gauteng by technology, 2014 and 2015
MTN South Africa coverage by network generation, year-end 2012 and 2013
MTN coverage by network generation in select African countries, year-end 2013
Telkom South Africa fixed broadband packages
Prices of 5Mbps broadband at Neotel and Telkom in South Africa
Mobile, smartphone and LTE subscriptions in South Africa, Q1 2013 to Q1 2014
Mobile subscription breakdown by network generation and use, Q1 2014
Data devices on Vodacom network, Q1 2012 to Q1 2014
Change in market shares in South Africa, Q1 2013 to Q1 2014
Key country indicators in South Korea, 2013 (year end)
South Korea market highlights
KT Telecom LTE lag behind SK Telecom and LGU+
LTE spectrum by operator in South Korea
LTE operator services in South Korea
Fixed broadband net additions in South Korea, 2010-2013
LGU+ fixed broadband subscriptions: 100Mbps vs total, 2011-2013
LTE subscriptions using VoLTE in South Korea, Q2 2012 to Q4 2013
Evolution of LTE plans in South Korea
Comparison of operator data plans in South Korea
Mobile, smartphone and LTE subscriptions in South Korea, 2010-2014
SK Telecom subscription breakdown by technology, Q1 2014
SK Telecom data usage on LTE and WCDMA, Q4 2011 to Q4 2013
Blended vs LTE ARPS in South Korea, Q2 2013 and Q1 2014
Blended ARPS by operator in South Korea, Q4 2011 to Q4 2013
Changes in subscription market shares, South Korea, 2010 to 2013
Key country indicators in the UK, 2013 (year end)
UK market highlights
LTE coverage by operator in the UK, 2012-2015
Key LTE spectrum holdings of UK operators
LTE content and service details by operator in the UK
Data usage on 4G plans in excess of average 3G usage, Vodafone, Q1 2014
Evolution of LTE plans in the UK
Mobile, smartphone and LTE subscriptions in the UK, 2010-2014
Additional LTE ARPS over 3G ARPS at three operators in the UK, Q1 2014
LTE subscriptions by operator in the UK
Change in retail postpaid ARPS of UK operators, Q1 2013 to Q1 2014
Key country indicators in the United States, 2013 (year end)
US market highlights
LTE coverage by operator in the US, Q1 2012 to Q1 2014
Free personal cloud storage bundles of ATandT and Verizon
Verizon broadband prices compared
US HD voice and VoLTE timeline
Portion of postpaid subscriptions on shared-data plans, Verizon and ATandT, Q1 2012 to Q1 2014
Verizon retail postpaid subscription breakdown by device, Q1 2014
Mobile, smartphone and LTE subscriptions in the US, 2010-2014
Postpaid ARPS by operator in the US, Q1 2011 to Q1 2014
Verizon average revenue per account, Q1 2012 to Q1 2014
Change in retail postpaid subscription market shares among top four US operators, Q1 2012 to Q1 2014
List Of Figures
NA
