Mobile broadband based on HSPA/LTE and other mobile communication standards hastaken off as an important technology for connecting mobile PCs to the Internet. The evolutionis led by Europe where HSPA now accounts for 12 percent of the total number of broadbandconnections, compared to 5 percent in North America. The concept that was first launched asan exclusive business service is now a mass-market consumer product sold on an intensivelycompetitive market. Consumers are utilizing their mobile broadband connections extensively,pushing the networks to their capacity limits. In fact the overwhelming majority of data trafficon mobile networks is today generated by notebook PC users that surf the Internet, notsmartphone users.Berg Insight estimates the total global number of shipped mobile broadband devices in 2008to 37.2 million, with Europe and North America accounting for 18.2 million units and 3.7million units respectively. The European device market grew by 222 percent in 2008, but islikely to cool off in 2009 as operators start reducing their inventories. Growth is forecasted tocontinue with shipments reaching 68 million units in 2014, fuelled by integration in notebookPCs and strong demand for mobility. Also the North American device market will experience arapid growth to reach 45 million shipments in 2014. The ASP in Europe was reduced fromabout ' 100 in 2007 to ' 45 in 2008. The US device market is still focused on business usersand the Chinese vendors Huawei and ZTE have not managed to capture significant marketshares, whereby the ASP remained as high as US$ 150 in 2008.The European mobile broadband service market continues to grow rapidly, with demandfuelled by declining prices, improved user experience and massive marketing campaigns.Berg Insight estimates that the total number of mobile broadband subscribers in EU 23+2grew by 74 percent to reach 14.6 million in 2008 while the estimated operator revenuesreached ' 3.4 billion. The European mobile broadband market is expected to grow at acompound annual growth rate of 14.3 percent to reach ' 7.6 billion in 2014. While the expected high demand from the PC-industry will lead to higher shipment volumes forembedded modules, the vast majority of new subscribers will only be occasional usersgenerating lower network ARPU.Berg Insight estimates that the number of mobile broadband subscribers in North Americawas about 4 million at the end of 2008. The estimated service revenues were about US$ 2.9billion and are expected to grow at a compound annual growth rate of 13.9 percent, to reachUS$ 6.3 billion in 2014. The growth in North America will accelerate when operators start totarget the consumer segment with attractively priced proposals. At a later stage, theincreasing number of notebooks featured with embedded modules will drive usage asconsumers do not need to make the initial hardware investment.Huawei has established itself as the world's largest supplier of mobile broadband terminalsand has a particularly strong foothold in Europe. In North America, the local vendors SierraWireless and Novatel Wireless still hold strong positions on a market where EVDO is thedominant network technology. Option was previously the main supplier in Europe, prior toHuawei's entrance and launch of the USB modem and is now ranked second. ZTE is thelatest player to join the race and have adopted an aggressive strategy to capture marketshares. Two of the largest telecom vendors ' Ericsson and Qualcomm ' entered the marketfor embedded solutions in 2008 and managed to sign contracts with many of the majornotebook vendors.

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Mobile Broadband in Europe and North America
Published on May 2009
Report Summary
Mobile broadband based on HSPA/LTE and other mobile communication standards has
taken off as an important technology for connecting mobile PCs to the Internet. The evolution
is led by Europe where HSPA now accounts for 12 percent of the total number of broadband
connections, compared to 5 percent in North America. The concept that was first launched as
an exclusive business service is now a mass-market consumer product sold on an intensively
competitive market. Consumers are utilizing their mobile broadband connections extensively,
pushing the networks to their capacity limits. In fact the overwhelming majority of data traffic
on mobile networks is today generated by notebook PC users that surf the Internet, not
smartphone users.
Berg Insight estimates the total global number of shipped mobile broadband devices in 2008
to 37.2 million, with Europe and North America accounting for 18.2 million units and 3.7
million units respectively. The European device market grew by 222 percent in 2008, but is
likely to cool off in 2009 as operators start reducing their inventories. Growth is forecasted to
continue with shipments reaching 68 million units in 2014, fuelled by integration in notebook
PCs and strong demand for mobility. Also the North American device market will experience a
rapid growth to reach 45 million shipments in 2014. The ASP in Europe was reduced from
about ' 100 in 2007 to ' 45 in 2008. The US device market is still focused on business users
and the Chinese vendors Huawei and ZTE have not managed to capture significant market
shares, whereby the ASP remained as high as US$ 150 in 2008.
The European mobile broadband service market continues to grow rapidly, with demand
fuelled by declining prices, improved user experience and massive marketing campaigns.
Berg Insight estimates that the total number of mobile broadband subscribers in EU 23+2
grew by 74 percent to reach 14.6 million in 2008 while the estimated operator revenues
reached ' 3.4 billion. The European mobile broadband market is expected to grow at a
compound annual growth rate of 14.3 percent to reach ' 7.6 billion in 2014. While the
expected high demand from the PC-industry will lead to higher shipment volumes for
embedded modules, the vast majority of new subscribers will only be occasional users
generating lower network ARPU.
Berg Insight estimates that the number of mobile broadband subscribers in North America
was about 4 million at the end of 2008. The estimated service revenues were about US$ 2.9
billion and are expected to grow at a compound annual growth rate of 13.9 percent, to reach
US$ 6.3 billion in 2014. The growth in North America will accelerate when operators start to
target the consumer segment with attractively priced proposals. At a later stage, the
increasing number of notebooks featured with embedded modules will drive usage as
consumers do not need to make the initial hardware investment.
Huawei has established itself as the world's largest supplier of mobile broadband terminals
and has a particularly strong foothold in Europe. In North America, the local vendors Sierra
Wireless and Novatel Wireless still hold strong positions on a market where EVDO is the
dominant network technology. Option was previously the main supplier in Europe, prior to
Huawei's entrance and launch of the USB modem and is now ranked second. ZTE is the
Mobile Broadband in Europe and North America Page 1/7

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latest player to join the race and have adopted an aggressive strategy to capture market
shares. Two of the largest telecom vendors ' Ericsson and Qualcomm ' entered the market
for embedded solutions in 2008 and managed to sign contracts with many of the major
notebook vendors.
Table of Content
Table of Contents
Table of Contents........................................................................................................................ i
List of Figures............................................................................................................................. v
Executive summary.....................................................................................................................1
1 Market environment .............................................................................................................3
1.1 Internet usage..............................................................................................................3
1.2 The European broadband communications market ...................................................4
1.2.1 Fixed broadband market.......................................................................................5
1.2.2 Wireless market.....................................................................................................8
1.3 The North American broadband communications market........................................10
1.3.1 Fixed broadband market.....................................................................................11
1.3.2 Wireless market...................................................................................................12
2 Evolved 3G network technology........................................................................................15
2.1 Wireless technology roadmap...................................................................................15
2.1.1 GSM.....................................................................................................................16
2.1.2 3G networks UMTS/WCDMA ' 3GPP Release 99 (Q1-2000) .............................17
2.1.3 HSDPA ' 3GPP Release 5 (Q1-2002) ................................................................18
2.1.4 HSUPA ' 3GPP Release 6 (Q4-2007) .................................................................20
2.1.5 HSPA+ ' 3GPP Release 7 (Q2-2008).................................................................21
2.1.6 HSPA+ ' 3GPP Release 8 and further evolution (H1-2009)...............................23
2.1.7 LTE ' 3GPP Release 8 (H1-2009) .......................................................................23
2.1.8 The CDMA/EVDO track .......................................................................................25
2.1.9 Other wireless technologies................................................................................27
2.1.10 Comparison of technologies...............................................................................28
2.2 Evolution of network infrastructure............................................................................31
2.2.1 From traditional to evolved network architecture................................................31
2.2.2 Improving network backhaul capacity ................................................................35
2.2.3 Expansion to new frequency bands....................................................................39
2.3 Evolution of wireless chipsets ...................................................................................40
3 Mobile broadband device vendors....................................................................................43
3.1.1 USB modems ......................................................................................................43
3.1.2 Embedded solutions ...........................................................................................44
3.1.3 PC-cards..............................................................................................................46
3.1.4 Gateways.............................................................................................................47
3.2 Mobile broadband terminal vendors .........................................................................48
3.2.1 Huawei.................................................................................................................49
3.2.2 Option..................................................................................................................50
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3.2.3 Novatel Wireless..................................................................................................53
3.2.4 Sierra Wireless.....................................................................................................55
3.2.5 ZTE ......................................................................................................................57
3.2.6 4G Systems .........................................................................................................58
3.2.7 AnyDATA .............................................................................................................58
3.2.8 BandRich.............................................................................................................58
3.2.9 Onda Communications .......................................................................................59
3.2.10 Teltonika ..............................................................................................................59
3.2.11 C-motech.............................................................................................................59
3.2.12 Axesstel ...............................................................................................................59
3.2.13 Others..................................................................................................................60
3.3 Embedded solution vendors .....................................................................................60
3.3.1 Ericsson...............................................................................................................60
3.3.2 Qualcomm...........................................................................................................62
3.3.3 Others..................................................................................................................62
4 Notebook PC integration ...................................................................................................63
4.1 The global notebook PC market ...............................................................................63
4.1.1 Market trends ......................................................................................................63
4.1.2 Notebook PC vendor market shares...................................................................65
4.2 Integration of mobile broadband in notebook PCs...................................................66
4.3 Notebook vendors .....................................................................................................69
4.3.1 Hewlett Packard ..................................................................................................69
4.3.2 Acer .....................................................................................................................70
4.3.3 Dell.......................................................................................................................71
4.3.4 Toshiba................................................................................................................72
4.3.5 Lenovo.................................................................................................................73
4.3.6 Fujitsu ..................................................................................................................73
4.3.7 Sony ....................................................................................................................74
4.3.8 ASUS...................................................................................................................74
4.3.9 Panasonic............................................................................................................75
4.3.10 Samsung Electronics ..........................................................................................75
4.3.11 Dialogue ..............................................................................................................76
4.3.12 LG........................................................................................................................76
5 Operator strategies for mobile broadband........................................................................77
5.1 Mobile broadband usage ..........................................................................................77
5.2 Business models .......................................................................................................79
5.2.1 Postpaid subscriptions........................................................................................79
5.2.2 Prepaid subscriptions .........................................................................................80
5.2.3 Bundling with other services ...............................................................................82
5.3 Pricing and conditions...............................................................................................83
5.3.1 Pricing .................................................................................................................84
5.3.2 International roaming ..........................................................................................84
5.3.3 Terms of use........................................................................................................87
5.4 3 Group......................................................................................................................88
5.5 Deutsche Telecom.....................................................................................................92
5.6 France Telecom.........................................................................................................95
5.7 KPN Group ................................................................................................................97
5.8 Telecom Italia.............................................................................................................99
5.9 Telekom Austria .......................................................................................................101
5.10 TeliaSonera..............................................................................................................103
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5.11 Telefónica Group .....................................................................................................106
5.12 Vodafone Group ......................................................................................................108
5.13 Verizon Wireless ......................................................................................................113
5.14 AT&T........................................................................................................................114
6 Market forecasts and trends ............................................................................................117
6.1 Market summary......................................................................................................117
6.2 Device market..........................................................................................................118
6.2.1 Vendor market shares .......................................................................................119
6.2.2 Form factor trends.............................................................................................122
6.3 The European mobile broadband service market...................................................124
6.3.1 Pricing trends ....................................................................................................127
6.3.2 Network technology trends ...............................................................................129
6.3.3 Service convergence trends .............................................................................130
6.4 The North American mobile broadband service market .........................................131
6.4.1 Pricing trends ....................................................................................................131
6.4.2 Network technology trends ...............................................................................132
7 Market profiles: Western Europe, North America and Australia......................................135
7.1 Austria......................................................................................................................136
7.2 Sweden....................................................................................................................138
7.3 United Kingdom.......................................................................................................143
7.4 USA..........................................................................................................................146
7.5 International outlook: Australia ................................................................................147
Glossary .................................................................................................................................151
List of Figures
Figure 1.1: Most popular online activities across Western Europe 24'34 year olds (2008) ......4
Figure 1.2: Fixed broadband market data (EU23+2 2008)........................................................6
Figure 1.3: Fixed broadband operators by number of subscribers (EU23+2 2008) .................7
Figure 1.4: Mobile operators by number of subscribers (EU23+2 Q4-2008) ............................9
Figure 1.5: Fixed broadband market data (North America 2008) ............................................10
Figure 1.6: Fixed broadband operators by number of subscribers (North America 2008)......11
Figure 1.7: Mobile operator by number of subscribers (North America Q4-2008) ..................13
Figure 2.1: Wireless subscribers by standard (Worldwide Q3-2008).......................................15
Figure 2.2: Technical performance data for 3GPP Release 5 (HSDPA)...................................18
Figure 2.3: Technical performance data for 3GPP Release 6 (HSUPA)...................................20
Figure 2.4: Evolution of different wireless technologies ...........................................................28
Figure 2.5: Theoretical peak data rates by technology ............................................................29
Figure 2.6: Correlation between bitrate and coverage .............................................................30
Figure 2.7: Average range of latency for a ping roundtrip........................................................31
Figure 2.8: UMTS network architecture ....................................................................................32
Figure 2.9: LTE network architecture........................................................................................34
Figure 2.10: UMTS data traffic in Swedish cellular networks (Sweden 2005'2008) ................36
Figure 3.1: Examples of USB-modems ....................................................................................44
Figure 3.2: Examples of embedded mobile broadband modules............................................45
Figure 3.3: Examples of PC-card models.................................................................................47
Figure 3.4: Example of a fixed wireless gateway......................................................................48
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Figure 3.5: Selection of mobile broadband terminal products from Huawei ...........................49
Figure 3.6: Selection of mobile broadband terminal products from Option ............................52
Figure 3.7: Selection of mobile broadband terminal products from Novatel Wireless.............54
Figure 3.8: Selection of mobile broadband terminal products from Novatel Wireless.............56
Figure 4.1: Notebook PC shipments (Western Europe 2004'2008) ........................................64
Figure 4.2: Notebook PC vendor market shares (World 2008) ................................................65
Figure 4.3: Number of notebook PC models with integrated HSPA (2007'2009) ...................66
Figure 5.1: Distribution of data consumption among different users (2009)............................78
Figure 5.2: Prepaid MBB offers from 3 Ireland (May 2009) ......................................................81
Figure 5.3: New postpaid and prepaid mobile broadband contracts in the UK (2008) ...........82
Figure 5.4: Examples of bundles in Europe by major operators (May 2009)...........................83
Figure 5.5: Tariffs for Telekom Austria's roaming packages (May 2009) .................................85
Figure 5.6: Roaming packages from Vodafone Netherlands (May 2009) ................................86
Figure 5.7: 3 Austria's roaming tariffs (May 2009)....................................................................86
Figure 5.8: 3 Group mobile broadband subscribers by market (2008)....................................88
Figure 5.9: 3 Group mobile broadband tariffs by country (May 2009) .....................................90
Figure 5.10: Acer Aspire notebook PC with 3's Huawei E180 USB-modem............................91
Figure 5.11: T-Mobile broadband tariffs by country (May 2009) ..............................................93
Figure 5.12: Orange mobile broadband tariffs by country (May 2009) ....................................96
Figure 5.13: KPN mobile broadband tariffs by country (May 2009).........................................98
Figure 5.14: Telecom Italia mobile broadband tariffs (May 2009)..........................................100
Figure 5.15: Mobile broadband subscribers (A1 Mobilkom 2007'2008) ...............................101
Figure 5.16: Telekom Austria mobile broadband tariffs (May 2009) ......................................102
Figure 5.17: TeliaSonera mobile broadband tariffs by country (May 2009)...........................105
Figure 5.18: Telefonica O2 mobile broadband tariffs by country (May 2009).........................108
Figure 5.19: Vodafone mobile broadband subscribers (FY2005'FY2009) ............................109
Figure 5.20: Vodafone mobile broadband tariffs by country (May 2009)...............................111
Figure 5.21: Verizon Wireless mobile broadband tariffs (May 2009)......................................114
Figure 5.22: AT&T mobile broadband subscribers (US 2007'2008) .....................................115
Figure 6.1: European mobile broadband market summary (2008'2014) ..............................117
Figure 6.2: North American mobile broadband market summary (2008'2014).....................118
Figure 6.3: Mobile broadband device shipments and revenues (EU/NA 2008'2014) ...........119
Figure 6.4: Estimated revenues and shipments by device vendor by region (2008).............120
Figure 6.5: Embedded module shipments by vendor............................................................121
Figure 6.6: Shipments of notebooks with embedded mobile broadband (EU/NA 2008'14) 123
Figure 6.7: Mobile broadband subscribers and operator revenues (Europe 2008'2014).....125
Figure 6.8: Mobile broadband market data (EU23+2 2008)..................................................126
Figure 6.9: Average monthly fee for mobile broadband services (Europe May 2009) ..........128
Figure 6.10: Mobile broadband subscribers and operator revenues (NA 2008-2014) ..........132
Figure 7.1: Fixed and mobile broadband subscribers by country (2008)..............................135
Figure 7.2: Mobile broadband subscribers (Austria 2005'2008) ...........................................137
Figure 7.3: Mobile broadband tariffs by operator (Austria May 2009)....................................138
Figure 7.4: Mobile broadband subscribers in Sweden (2006'2008) .....................................140
Figure 7.5: Mobile broadband tariffs by operator (Sweden May 2009)..................................141
Figure 7.6: Mobile broadband operator market shares (Sweden H2-2008) ..........................142
Figure 7.7: Mobile broadband tariffs by operator (UK May 2009)..........................................144
Figure 7.8: Mobile broadband tariffs by operator (US May 2009)..........................................147
Figure 7.9: Mobile broadband tariffs by operator (Australia May 2009).................................149
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