2G wireless is alive and well in developing countries

12 July 2006 Telecoms, Datacoms, Wireless, IoT

2G and 2,5G wireless infrastructure is alive and well and living in the developing world. With most mobile telephone infrastructure markets in industrialised nations near or at saturation levels, wireless basestation vendors are looking farther afield, all the way to China, India, and other fast-growing markets in Asia, Africa and Latin America.

The problem with addressing such markets is their low wage/low price economies. Unable to leapfrog directly to 3G because of its high upfront cost and small cell size, operators in developing markets need efficient and easily upgradeable 2G/2,5G networks.

According to Lance Wilson, ABI Research director of wireless infrastructure research, "The major infrastructure manufacturers have to be very clever in producing cost-effective 2G and 2,5G systems for developing markets, because there is not a lot of money to spend."

An example cited in the latest market update of the research group's Wireless Infrastructure Research Service, demonstrates that some vendors are rising to meet the challenge. Ericsson's 'Expander' program requires 30-40% fewer cell sites 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.

This 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 which, according to the updated forecasts contained in the study, continues to stagnate from an overall standpoint. Only the WCDMA and CDMA2000 1x EV-DO sectors defy the market's general flatness. The market update also discusses how wireless infrastructure vendors are moving down the path of fixed-mobile convergence.

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