ABI: Wireless Vendors Smart to Develop Low-Cost 2G Solutions for Developing Countries

By Mae Kowalke

TMCnet Associate Editor

 

While 3G technology—which allows both voice signal and data to be transmitted wirelessly—may be popular in Europe and the U.S., in developing countries upgrading to the digital signal of 2G is still the bee’s knees.

 

Wireless base station vendors are aware of this and, because of market saturation in industrialized countries, are looking further afield—to China, India, Asia, Africa and Latin America.

 

That’s according to a new report from ABI Research, which finds that the focus when targeting those markets needs to be production of low-cost 2G solutions as stepping stones to 3G.

 

“The major infrastructure manufacturers have to be very clever in producing cost-effective 2G and 2.5G systems for developing markets, because there isn't a lot of money to spend,” ABI analyst Lane Wilson noted in a press release about the report.  

It appears that vendors are rising to the challenge.

 

ABI used Ericsson’s (News - Alert) “Expander” program as an example; it helps operators expand into new markets by offering infrastructure that requires 30-40 percent fewer cell sites than traditional GSM networks, allowing “installation and expansion of 2G/2.5 networks in an exceptionally cost-efficient manner,” according to Wilson.

ABI described Ericsson’s solution as one that “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 $5.00.”

It is just that kind of infrastructure, designed specifically for the developing world, that may help mitigate stagnation in the wireless market generally, ABI said, noting that only the WCDMA and CDMA200 1x EV-DO sectors can be described as anything other than flat.