New technology platform eliminates merger barriers of CDMA, GSM networks

Ben Uzor Jr
Indications have emerged that the sprouting of LTE (Long Term Evolution) technology could eliminate the barriers to consolidation via mergers and acquisition in Nigeria’s telecommunication industry. This is because both CDMA (Code Division Multiple Access) and GSM networks can co-exist simultaneously on this new radio platform, Business Day can now reveal.
Business Day had earlier reported that a wave of hushed mergers and acquisition moves was already going on in Nigeria’s telecom space, as small operators struggle to acquire the critical mass necessary for survival and bigger ones strive to acquire the small and move to positions of greater strength.
Conversely, issues revolving around the interoperability of networks may have impeded the consolidation process especially between GSM and CDMA operators, industry watchers have argued. In providing the needed pedestal for CDMA and GSM to coexist, LTE assumes a full Internet Protocol (IP) network architecture designed strategically to support voice in the packet domain.
It was also learnt that LTE would open up new revenue generating streams for operators in the face of harsh economic conditions by enabling new capabilities well beyond traditional voice and data services. This is even as Nigeria’s telecom market remains dominated by pre-paid 2G services.
But more importantly, there are also claims that LTE if deployed could assist operators to potentially get ahead of many markets thus putting Nigeria on the front foot rather than playing catch-up. Furthermore, operators may look upon LTE as been a better investment than 3G because they already recognize that 3G will not be the definitive solution to broadband access in the country.
Business Day investigations reveal that operating companies such as Starcomms, ZoomMobile and Multilinks-Telkom have already started making various levels of commitment in a future with LTE by developing strategies and making considerable investment in that regard. Globally, over 100 telecom operators as of Q1 2009 had indicated interest and actually made commitments to LTE adoption.
“GSM and CDMA are going to end up on a new technology called LTE. Right now, there are trials of LTE in the United States of America (USA), Japan and China has just adopted LTE, China Telecom. In a couple of years, maybe maximum next three years, we would see full scale commercial implementation of LTE.
“So, if you are going to have a convergence, we are gradually moving to technology neutrality or if you like interoperability of devices, networks, and so on. This is the time for a major GSM operator to begin to look at consolidating the CDMA sphere because it just adds value”, Ken Aigbinode, executive vice chairman, ZoomMobile had revealed to BusinessDay in an exclusive interview.
“Now, CDMA as at today is the best technology for data service. GSM as a basic technology is very good for voice however GSM has to upgrade to GPRS, EDGE to begin to do data. CDMA in its basic form, CDMA 20001X, it already does internet very well. “So, if you take the entire spectrum that we have on the CDMA area in Nigeria and dedicate it to data then leave your GSM spectrum to voice only, I think you will see a lot of efficiency in that, he added.
On the other hand, Maher Qubain, chief executive officer, Starcomms Plc who also spoke to BusinessDay recently noted to migrate to LTE would however require more spectrums. “So, if part of my LTE growth strategy means that I have to acquire spectrum from other operators then that’s something we would definitely look at. However, to go to the 4G technology, by the way 4G means both GSM and CDMA coming together, no more differential, and one handset in the world. To achieve the speed and the benefit of LTE, you need 20 MEGs of spectrum”, he revealed.
Moreover, for the first time, leading GSM and CDMA operators are building towards global consensus on their planned deployment of LTE which had begun with trials in 2009 and hopefully initial deployment in 2010 and 2011. Some telecom operators in Nigeria share the view that LTE will enable them offer better value to their customers. In addition, facilities such as broadband internet access and streamed multimedia would be provided to users on an ‘anytime, anywhere’ basis and at much higher data speeds compared to previous generations.