Towards LTE and Broadband everywhere
Ulf EwaldssonHead of Radio
Networks
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 2
HSPA TRAFFIC SURPASSES GSM~ 15 MILLION NEW HSPA SUBS/MONTH
Source: WCIS/Informa and Ericsson
Fastest growing Internet technology
2007 2008 2009
0
50000000
100000000
150000000
200000000
250000000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
WCDMA/HSPA
Speech + Data
GSM
Speech + Data
WCDMA
Speech
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 3
3 waves of mobile connectivity
1000 x Traffic
50 Billion Connections
8 Billion subscribers
EVERYTHING & EVERYONE IS CONNECTED
MOBILE VOICE
MOBILE BROADBAND
RADIO IN ALL THINGS
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 4
Mobile Broadband Growth
Global Mobile BB subscriptions
0
200
400
600
2009 20150
500
1000
1500
2000
2500
3000
3500
2009 2015
Mil
lio
n s
ub
sc
rib
er
s
Bil
lio
n U
SD
Mobile operator data revenues
Source: Internal Ericsson
This slide contains forward looking statements
CAGR
~ 45%CAGR
~ 28%
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 5
HSPA ECO SYSTEM SUCCESS
Sources: GSA, WCIS / Informa
› 341 networks– 143 countries
› 500 Million subscribers
› 2349 devices– Over 230 suppliers
GSM largest technology, followed by HSPA
Commercial
Commitments
Commercial
Commitments
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 6
Mass market smartphonesSales forecast
20-50% sales CAGR in all regions
Source: Pyramid research
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 7
Traffic load ComparisonLoad per device
Data traffic
Sig
nali
ng
tra
ffic
Voice
Smart
Phones
PC-cards
Voice phones < Smart phones < PC-cards
180M
Growth: >5 million per month
120M
Growth: 4-5 million/month
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 8
smartphone leadershipexample from commercial network
Subscribers per RNC & RBS
Ericsson
supplied
network*
World average*
Smartphone penetration
Ericsson
supplied
network*
World average (sold units)**
+
Source: * Ericsson estimates, ** Pyramid
2x > 50%
10-15%
1
Ericsson supplies most loaded smartphone networks
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 9
7
21
28
42
84
168
…
HSPA
64QAM
MIMO
Multi carrier (2)+ 64QAM or
MIMO+ 64QAM
Multi carrier (2)+ 64QAM+ MIMO
orMulti carrier (4)
+ 64QAM
Multi carrier (4)+ 64QAM+ MIMO
HSPA evolutionpeak rate in mbps
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 10
Commercial LTE Speed evolution
2009
2010
2014
Peak rate ~50 Mbps ~150 Mbps ~1000 Mbps
Typical user rate downlink 5-30 Mbps 10-100 Mbps Operator dependent
Typical user rate uplink 1-10 Mbps 5-50 Mbps Operator dependent
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 11
The Network – a differentiator
< Half the
Latency
2x Faster
Downloads
+ 50%
Capacity
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 12
Ericsson proud supplierTo all winners
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 13
Why Ericsson RAN perform better than competition
Superior RX/TX Design
PARdesignPARideal
Ppeak
Paverage
BB1001010010
RAN System design
EUL10ms/HS
(maxSF16)
EUL10ms/HS
(maxSF32)
Cell_FACH
EUL10ms/HS
(maxSF8)
EUL10ms/HS
(maxSF4)
EUL2ms/HS
(max2*SF2)
EUL2ms/HS(max2*SF4+2*SF2)
EUL/HS
Cell_FACH
Competitor Ericsson
25 s
1 s
1.5dB better link budget
Filter characteristics & linearity
No power back-off at high speeds
Speed, Coverage & Capacity
Scheduler design & intelligence in RBS
Significantly lower delays in the system
Better user experience, less latency & signaling (30-50%)
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 14
Revenues
Costs
45%
EBIT
Cost/Bit
Time
Traffic (Bit)
Business case challenge
GSM/EDGE
HSPA
LTE
Packet
CoreTraffic
shaping
3G Direct
Tunnel
LTE
Core
Evo RAN
3G2G
Microwave, Fiber
or copper
Metro – Ethernet
IP
LTE
Building blocks to bring down the cost per bit
Eco-system Good profit margin
Efficient RAN evolution Enhanced Packet Core High capacity mobile backhaul
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 15
Business Case example: 50% Cost reduction possible per MBB sub
0
1
2
3
4
5
6
7
8
Cost
($/sub/month)Bandwidth management & Traffic handling of “top 5%
users”
NW optimization
& utilization
Spectrum &
Energy savingsLonger PLC
10 yrs vs. 8 yrs.
1
2
3 4
...reaching TCO of < 4 $/Sub/Month!
*Subscription: 3GB per month,
7.2 Mbps
$ 3,5
$ 4,0
$ 0,7
$ 1,3
$ 0,6
$ 0,3
$ 0,5
$ 0,4
$ 2,8
$ 1,1
-27%
-11%
-11%
-10%
$ 7,5 $ 2,0
$ 3,9
US
D/s
ub &
month
Typical Ericsson
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 16
LTE Commercial contractsBY OPERATOR SIZE
0
20
40
60
80
100
Ver
izon
*
AT&
T*
DO
CO
MO
*
KDDI
Met
roPC
S
Telia
Son
era
(SE)*
N4M
CSL
(HK)
Telen
or (N
)
Telia
Son
era
(N)
Telen
or (D
K)
Ericsson selected
Others selected
MSUBS
*=Other vendor involved in contract in addition to Ericsson
Subscriber figures from World Cellular Information Services, 12/2009
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 17
HS+
100%
GPRS EDGE0%
HSWorld
Population
% Population
Coverage
GSM LTEWCDMA
World population of 6,8 Billion people
WCDMAGSM LTE
Metro
Urban
Sub
urban
Rural>85% >80%
>50%
30%
25%
3-5%<<1%
Mobile Broadband Going Forward
SW Upgrades
Capacity
expansion (Carriers &
RBS)
Coverage
extension
Business Opportunities
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 18
50 billion connections 2020
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© Ericsson AB 2010 | Ericsson Capital Markets Day 2010 | 19