Prospects for 3G Mobile Communications Market and Technology January, 2004 NEC Corporation January, 2004 NEC Corporation 1. 3G Mobile Market Status 2.

Prospects for 3G Mobile Communications Market and TechnologyProspects for 3G Mobile Communications Market and Technology

January, 2004January, 2004

NEC CorporationNEC Corporation

January, 2004January, 2004

NEC CorporationNEC Corporation

1. 3G Mobile Market Status1. 3G Mobile Market Status2. View on Future Evolution2. View on Future Evolution

A) Radio Aspect A) Radio Aspect B) Network AspectB) Network Aspect

3. NEC’s Activities3. NEC’s Activities

1. 3G Mobile Market Status1. 3G Mobile Market Status

© NEC Corporation 2004 Confidential 3

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000NTT DoCoMo Mobile sub.

au Mobile sub.

Vodafone Mobile sub.

i-mode sub.

Ezweb sub.

Vodafone Live sub.

Mobile users in JapanMobile users in JapanTotal Mobile users: 85MTotal Mobile internet users :74MRatio of 3G user : 30% （ as of end Dec 04 ）

(K)

19961996 19971997 19981998 19991999 20002000 20012001 20022002 20032003Source: TCA (Telecommunications Carriers Association)

20042004

90% of mobile users use Mobile Internet in Japan

Photo mail start(Nov 00)i-mode start

(Feb 99)

1st Stage Mobile Internet Rapid increase in Mobile

Internet usersFixed Rate Billing

start(Nov 03)

2nd Stage Mobile Internet

Photo mail supporting the improvement of Data ARPU

3rd Stage Mobile Internet Introduction of new services

enabled by “fixed rate billing”


0

10

20

30

40

50

60

70

80

90

100

Mar-97 Mar-98 Mar-99 Mar-00 Mar-01 Mar-02 Mar-03 Mar-04

AR

PU

in

Eu

ro

0

5

10

15

20

25

30

35

40

45

50

i-mod

e R

atio

(%

)

i-mode

Voice

Ratio of i-mode

Source: NTT DoCoMo

Decline in voice service revenue has been recovered by data service revenue. (e.g. NTT DoCoMo)

New Revenue generated by Mobile Internet Service

Euro = 135 J-yen

(2Q/2004)

0

10

20

30

40

50

60

70

80

90

DoCoMoTOTAL

DoCoMoFOMA

au TOTAL au EV-DOA

RP

U i

n E

UR

O

Data

Voice


Data SpeedData SpeedData SpeedData Speed

Evolution of Service and Terminal Functionwith increase of Data Speed

Service/Service/

ContentsContents

Service/Service/

ContentsContents

TerminalTerminalTerminalTerminal

Wall PaperWall PaperWall PaperWall Paper

Ringing ToneRinging ToneRinging ToneRinging Tone

Sort TextSort TextSort TextSort Text

Picture MailPicture MailPicture MailPicture Mail

Real ToneReal ToneReal ToneReal Tone

Log/DiaryLog/DiaryLog/DiaryLog/Diary

Movie ClipMovie ClipMovie ClipMovie Clip

Full MusicFull MusicFull MusicFull Music

GameGameGameGame

Digital CameraDigital CameraDigital CameraDigital Camera Media PlayerMedia PlayerMedia PlayerMedia Player Digital TVDigital TVDigital TVDigital TV

SchedulerSchedulerSchedulerScheduler

NovelNovelNovelNovel

NetworkNetworkNetworkNetwork2G2G2G2G 2.5G2.5G2.5G2.5G 3G3G3G3G

~10Kbps ~10Kbps 100Kbps ~100Kbps ~


Mobile Subscribers in Japan

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

Dec/01 June/02 Dec/02 June/03 Dec/03 June/04 Dec/04

Sub

scrip

tion

in T

hous

and

3G TOTAL

2G TOTAL

3G: WCDMA, 1x/Ev-Do,

2G: PDC, cdmaOne

Source: Telecommunications Carriers Association, Japan

-800

-600

-400

-200

0

200

400

600

800

1000

1200

Jan

-04

Fe

b-0

4

Ma

r-0

4

Ap

r-0

4

Ma

y-0

4

Jun

-04

Jul-

04

Au

g-0

4

Se

p-0

4

Oct

-04

No

v-0

4

De

c-0

4

Ne

t In

cre

ase

('00

0)

DoCoMo 2GDoCoMo 3Gau 2Gau 3GVodafone 2GVodafone 3G

Mobile Subscribers in Japan(Accumulated)

Mobile Subscribers in Japan(Monthly)

30%30%

Subscribers are shifting from 2G to 3G


0.16 0.35 0.591.1

5.49

6.75

8.87

1.99

4.18

0

1

2

3

4

5

6

7

8

9

Jan Mar May Jul Sep Nov Jan Mar May July Sept Nov

3G subscriptions are increasing very rapidly

2003 2004

(1M subs)

Source : Telecommunications Carriers AssociationSource : Telecommunications Carriers Association

DoCoMo8.50Mil sub.

Vodafone0.37Mil sub.

W-CDMA Subscribers in Japan


Japan8.9mil

3 Italy2.0 mil.

3 UK1.8 mil.

3 Austria

3 Sweden

At the beginning of 2005, global subscription of UMTS network

had already reached to 16 million on more than 60 networks..Source: UMTS Forum

3 Australia

Source: TCA and Others. As of December 2004

16 million W-CDMA subscribers in the world

3G OperatorSubscribersin thousand

DoCoMo 8,499

Vodafone KK 366

3 UK 1,800

3 Italy 2,000

Other 3 Operators 2,100

3G OperatorSubscribersin thousand

DoCoMo 8,499

Vodafone KK 366

3 UK 1,800

3 Italy 2,000

Other 3 Operators 2,100


Japanese users enjoy rich data service since introduction of flat-rate charge

Set favorite contents(3 programs, max.3MB/prog)

Download contents at night

Enjoy contents atanytime and anywhere

“EZ Channel” by auPeriodic auto-delivery Contents service

“EZ Channel” by auPeriodic auto-delivery Contents service

Flat-rate Charge Service started in Japan

Packet Traffic

Start date System Monthly Price No. of Users

KDDI Nov. 2003 EV-DO \4200 (Euro31)

1.1 Mil

DoCoMo June 2004 WCDMA \3900 (Euro29)

1.4 Mil

Vodafone

Nov. 2004 WCDMA \3900 (Euro29)

-

“Chaku-Uta Full” by auDownload entire Music

“Chaku-Uta Full” by auDownload entire Music

Interactive GameInteractive Game


Near toBase station(High Radio Strength)

Far from

Base Station(Low Radio Strength)

-Adaptive Modulation and Coding QPSK to 16QAM, Low to High Error Correction- Hybrid ARQ, Fast Adaptive Scheduling

• Down link : W-CDMA=384kbps HSDPA=14.4Mbps• Improvement of total throughput with dynamic far field / near field control• HSDPA specification: 3GPP　 Release 5

Low Speed High Speed

HSDPAReady for commercial service within one year

HSDPA uses remaining carrier power for

packet traffic

Packet Traffic


What is happening in current mobile market in Japan ?

• Fixed Tariff for Packet traffic is becoming dominant in 3G– AU (Ev-Do): 1 Mil users now

• Packet usage 30 times of ordinary users– DoCoMo (WCDMA): 1.4mil user now

• Packet usage 13 times of ordinary users• Traffic on 3G network increased 1.9 time

s– VDF KK (WCDMA): Stared in Nov.2004

• “HSDPA” will be soon.– HSDPA is the key technology for realizing fl

at-rate packet communication service efficiently.

– Best effort type packet traffic increases rapidly by efficient use of radio resources.

Network to be preparedin advance

Packet traffic isincreasing rapidly

Over 100 systems arein commercial operation

© NEC Corporation 2004 Confidential 12Source: DoCoMo/Vodafone

100%

90%

80%

70%

60%

50%3 6 9 12 3 6 9 12 3 6

2002 2003 2004

:DoCoMo:Vodafone KK

Vodafone KK :99.6%(as of Aug.2004)

DoCoMo: 99.7%(as of Jun.04)

5,000

4,000

3,000

2,000

1,000

0

No. of sites

150

1670

3800

1800

3500

Mar.2003 Mar.2004 Mar.2005(plan)

:DoCoMo:Vodafone

●DoCoMo Vodafone KK and networks reached to more than 99% of area coverage ratio (equivalent to 2G)●Expanding indoor coverage for user satisfaction

Coverage Expansion Plan

Outdoor Coverage in terms of population Indoor Coverage in terms of No. of sites


Coverage DesignArea Patrol

RAN System Installation

RAN Tuning

W-CARD

Drive TestW-CARD

Commercial Service

Continuous Quality Improvement & Area Management

RAN OptimizationRAN Optimization

2. View on Mobile Network Evolution

A) Radio Aspect (Super3G)


A) Radio Aspect (Super3G)


Mobile Network Evolution for Future

4G4G4G4GS3GS3GS3GS3G3.5G3.5G3.5G3.5G3G3G3G3G

384Mb/s384Mb/s 14Mb/s14Mb/s

NetworkNetworkAspectAspect

100Mb/s100Mb/s 1Gb/s1Gb/sDataDataSpeedSpeed

RadioRadioAspectAspect

WCDMAWCDMA EnhancementEnhancement MIMOMIMO OFDM, etcOFDM, etc....

HSDPAHSDPA AMCAMC H-ARQ, etc.H-ARQ, etc.

New AccessNew Access

CS + PSCS + PS PS Only (All IP)PS Only (All IP)

CSCS

IMSIMS PSPS

IMSIMSIMSIMS

PSPSRANRAN

IP-RAN

IP-RAN


MIMO: Multiple Input Multiple Output

Parallel Spatial transmission by multiple transmit and receive antennas increase the Frequency efficiency

Par

allelT

ran

sm

ission 　

Sig

nal

Sep

aratio

n

& D

iversity C

om

bi

ning

■MIMO Multiplexing

Parallel spatial Transmission of data signals using Multiple Transmit antennas

=> Increase Data rate by the number of antennas

■MIMO Diversity

Transmit same data and receive them diversity combining

　　 => Improve receive performance under bad radio propagating condition

Tx Rx

#1

#2

#3

#4

#1

#2

#3

#4


Down Link Access Scheme: OFDM

VSF-OFCDM• OFCDM: Orthogonal Frequency & Code

Division Multiplexing– Optimal Mixture of Orthogonal Frequency Division

Multiplexing (OFDM ） and Code Division Multiplexing (CDM)

– Time and Frequency domain spreading is adopted to OFDM

• Improve frequency reuse efficiency by OFDM• Frequency Diversity effect by narrow band

multi-carrier

• VSF: Variable Spreading Factor– Cellular Environment: Spreading factor > 1

• To reduce the affect of interference • Data Rate: 10Mbps@10MHz BW

– Hot spot Environment: Spreading factor = 1• To increase the link capacity• Data Rate: 100Mbps@10MHz BW with MIMO

OFCDM Coding


B) Network Aspect (Fixed Mobile Convergence)


B) Network Aspect (Fixed Mobile Convergence)


Multiple new wireless technologies with high-speed, wide-band, and high mobility emerged

　　 aiming at Beyond 3GTwo systems (1) “Cellular phone technology” based on 3G or 3.5G and (2) “Wireless 　　　 LAN technology” based on _WiFi are present and various kinds of regulations appeared.

Multiple new wireless technologies with high-speed, wide-band, and high mobility emerged

　　 aiming at Beyond 3GTwo systems (1) “Cellular phone technology” based on 3G or 3.5G and (2) “Wireless 　　　 LAN technology” based on _WiFi are present and various kinds of regulations appeared.

2～ 3Km

Mobility*

（Sp

eed km

）

Communication speed ** (Mbps)

High

LowHigh

～ 100

～ 10

～ 3 ～ 50Low

802.11b802.11a

802.11bWiFi

802.16e 802.16aWiMax

PHS

HSDPA

2/2.5G

3/3.5G

Mobile phone

Wireless LAN

High-speed, wide-area wireless technology with 4G, 802.20, etc.

Communication distance ***

100m max.　　

*Adaptability to mobile in a base station**Downlink speed***Effective communication distance from base stationReference: Search description, ABI research

Difference between Mobile phone and Wireless LAN

NW: Close - OpenCapacity: Based on voice – Data with large capacityQoS: Complete – Basically best effort.

Evolution of Radio Access NetworkEvolution of Radio Access Network- Flow of 2 Systems Aiming at Wireless Broadband -- Flow of 2 Systems Aiming at Wireless Broadband -


Public telephone network

Public telephone network

FOMA Mobile telephone network

FOMA Mobile telephone network

Solution in Cooperation with FOMA®

My Office Anywhere, In-house or outside, by one FOMA®®

Outside

At siteAt siteAt siteAt site

FOMA N900iLFOMA N900iL

MovingMoving

At maintenance site

To web meetingfrom TV telephone

Reference to documents for

meeting


FOMA® is a registered trademark of NTT DoCoMo.

Off deskOff deskOff deskOff desk

In-house

Access point Access point

UNIVERGE WLWireless controller

UNIVERGE WLWireless controller


Can catch easily by 　use of presence

Wireless extension telephone

by wireless LAN(Wireless IP telephone)

FOMA in office

FOMA N900iLFOMA N900iLApplication

cooperation from FOMA

outside the office

At own deskAt own deskAt own deskAt own desk


FOMA FOMA N900iN900iLL

Wireless Wireless LANLAN

ＦＯＭＦＯＭＡＡ

Wireless LANWireless LAN

SIP telephony serverUNIVERGE SV7000

Application server


WLAN AN

3GPP-AAA

WLAN AN

3G public WLAN

AP

UMTS

IMS

AP

AP AP

BTS BTS BTS

IP-RNC(aTCA)

SGSN(aTCA)

GGSN(aTCA/RMS)

HSS CSCF MRFC

MGW

MGWWAG

WAG

PDG

MRFP

MGCF

3G PS

Fixed Network VoIP

I-CSCF

CSCF 3G-AAAProxy

SV7000 Enterprise

BASResidence

3G Authentication

Enterprise

AP

SV7000AP

Mobile Network Fixed network

New PF applied

PDG : Packet Data Gateway WAG :WLAN Access Gateway AAA :Authentication, Authorisation and Accounting AP :Access Point MGW:Media Gateway FunctionHSS :Home Subscriber Server

PDG : Packet Data Gateway WAG :WLAN Access Gateway AAA :Authentication, Authorisation and Accounting AP :Access Point MGW:Media Gateway FunctionHSS :Home Subscriber Server

MRFC: Multimedia Resource Function ControllerMRFP: Multimedia Resource Function Processor CSCF: Call Session Control Function MGCF:Media Gateway Control Function

MRFC: Multimedia Resource Function ControllerMRFP: Multimedia Resource Function Processor CSCF: Call Session Control Function MGCF:Media Gateway Control Function

3G CS

PSTN

Next Generation Mobile Network

SGW


・・・Service Applications/ ContentsService Applications/ Contents

IP based Service Platform IMS

Mobile Packet NetworkFixed Packet Network

Internet

2G/3G Mobile

ADSL／FiberHSDPA/EUDCH

Wireless AccessWireless Access

Wired AccessWired Access

Cable

WiFiWiMAX

Business TripBusiness Trip

OfficeOfficeHot SpotsHot Spots

ResidenceResidence

TransportatiTransportationon

One Stop Subscription / Single User ID / Simple Billing One Stop Subscription / Single User ID / Simple Billing

Mobile/Fixed Service Integration-Seamless Service-

NEC’s ActivitiesNEC’s Activities


NEC serves you the total solutions with the most innovative technologies and services.

Semi-conductors, Electric PartsSemi-conductors, Electric Parts

InfrastructuresInfrastructuresTerminalsTerminals

PSTNPSTN

The internetThe internet

Macro Node-B

Mobile Internet PlatformMobile Internet Platform

Basic Servers VA Servers

In-Building SolutionsIn-Building Solutions(Micro/Pico Node-B)(Micro/Pico Node-B)

GGSNGGSN

SGSNSGSN

Core NetworkCore Network

RNCRNCSGWSGWHSSHSS

MGWMGW

CSCFCSCFMRFMRF

MGCFMGCF

PresencePresence

IP Multimedia Subsystem (IMS) IP Multimedia Subsystem (IMS)

NEC Multimedia Platform (NEMIP) NEC Multimedia Platform (NEMIP)

Gateway Gateway &Proxy&Proxy

Contents

Contents

E2E solutions for mobile networkE2E solutions for mobile network

NB-341Micro NBNB-341

Micro NB

NB-44x/88xMacro NB

NB-44x/88xMacro NB

Radio Server +Remote RF HeadRadio Server +

Remote RF Head


Professional ServicesRapid and accurate Design Simulation and OptimizationHigh Skill, Know-how, and Experience

Equipment SolutionsSmall & High Performance Products

Cafeteria Airport, Station Office building

NEC SolutionsNEC Solutions

RF Server

Shopping Mall

RS3000

RF Repeater

Design, Implement, Optimisation

Micro Node B

BuilSke/FloSco

100% HSDPA

prepared

Radio Server + Remote RF Head

Indoor Solution


FinlandFinland

Asia

Europe

UKUK NorwayNorwayGermanyGermany

NetherlandsNetherlands

BelgiumBelgium

LuxemburgLuxemburg

SpainSpain

PortugalPortugal

FranceFrance

Czech Czech RepublicRepublic

PolandPoland

AustriaAustria ItalyItaly　　GreeceGreece

BahrainBahrain S.AfricaS.Africa

JapanJapan

TaiwanTaiwan

HongKongHongKong

MalaysiaMalaysiaMoonacoMoonaco

Isle of ManIsle of Man

W-CDMA Infrastructure Sales to 33 Operators in24 Countries/Regions

North America

USAUSA

Middle East /Africa

NEC/Siemens WCDMA Projects (Contract)


NEC /Siemens enjoy Top share of Base Stations NEC /Siemens enjoy Top share of Base Stations in Commercial Operation with 23,800 units(35.1%) in Commercial Operation with 23,800 units(35.1%)

Source: “Worldwide W-CDMA Cellular Base Station Market Report “ by Multimedia Research Institute (Aug. 2004) 　

NEC/NEC/SiemensSiemens３５．１％３５．１％

Ericsson22.8%

Nokia20.8%

Panasonic10.6%

Fujitsu5.6%

Others5.1%

Total No. of Node-B : 67,900

W-CDMA Base Station Vendor Share(No. of Units Commercially Deployed as of Aug.2004)

ConclusionConclusion


Bridge for Virtual and Real= Digital Appliance =

ISPISP

CPCP

ShopShop

BankBank

HomeHome

MaterializationMaterialization

UnexpectedlyUnexpectedlySuddenlySuddenly

UnexpectedlyUnexpectedlySuddenlySuddenly

Needs of UsersNeeds of Users

• Want to contact XXWant to contact XX

• Want to Watch TV, listen to musicWant to Watch TV, listen to music

• Want to check XXWant to check XXWant to MemoWant to Memo

• Want to know timeWant to know time

• Want to shopWant to shop 　　　・・・・・　　　・・・・・

What users “want to do” not “can do”What users “want to do” not “can do”

without Time and Place constraintwithout Time and Place constraint

What users “want to do” not “can do”What users “want to do” not “can do”

without Time and Place constraintwithout Time and Place constraint

Digital Appliance


Service and Terminal Diversification corresponding to Network Evolution

StreamingStreamingStreamingStreaming

LISLISLISLIS

PicturePicturePicturePicture

RingingRingingMelodyMelodyRingingRingingMelodyMelody

InternetInternetInternetInternet

MailMailMailMail

ＳＭＳＳＭＳＳＭＳＳＭＳRoamingRoamingRoamingRoaming

VoiceVoiceVoiceVoice

GameGameＰＩＭＰＩＭ GameGameＰＩＭＰＩＭ

InfraredInfraredRayRay

InfraredInfraredRayRay

StorageStorageStorageStorage

MobileMobileCommerce Commerce

MobileMobileCommerce Commerce

Digital TVDigital TVDigital TVDigital TV

WirelessWirelessＬＡＮＬＡＮ

WirelessWirelessＬＡＮＬＡＮ

Music playerMusic player

GPSGPSViewerViewer

Digital TVDigital TV

LANLAN

ApplicationApplicationServiceService

TerminalTerminal

Internet phoneInternet phone

RFIDRFID

JAVAJAVA

PCPCTelephoneTelephone

Fuel CellFuel Cell

3.5G > S3G > 4G3.5G > S3G > 4G3G3G2.5G2.5G2G2G

10kb/s10kb/s 100kb/s100kb/s 1Mb/s1Mb/s 10Mb/s10Mb/s

CircuitCircuit Circuit+Circuit+ （（ PacketPacket ））（（ CircuitCircuit ）） +Packet+Packet →→ ＡＬＬ　ＩＰＡＬＬ　ＩＰ

MobileMobileNetworkNetwork

100Mb/s100Mb/s 1Gb/s1Gb/s


Prospects for 3G Mobile Communications Market and Technology January, 2004 NEC Corporation January, 2004 NEC Corporation 1. 3G Mobile Market Status 2.

Documents

mobile internet servicesource

japan mobile users

mtotal mobile internet

g mobile communications

g mobile market status2

japantotal mobile users

g total67

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