Telstra announced that it is upgrading its HSPA network to HSPA+, which the company says will offer peak downlink speeds of 21Mbps by end of 2008. Looks like Telstra pipped the other operators to the post – Qualcomm had announced multiple HSPA+ trials early this year to be conducted with Hutchison 3G, Telecom Italia, Telefonica and Telstra.
Telstra has always prided on itself being ahead of other carriers and the device ecosystem – it launched its Next G HSDPA network operating in the 850MHz band in record 10 months in 2006. Use of existing GSM bands, such as 850MHz and 900MHz, enables Telstra to expand broadband coverage much more cost-effectively than they can using higher frequencies. Radio signals travel much further at these frequencies than they do at 2100MHz, the other main band currently used for HSPA mobile broadband services, reducing the number of base stations required to cover any given area.
Not satisified, in 2007, Telstra upgraded its network to support a peak rate of 14.4Mbps (another first) even though no devices were available that could download at those speeds! And now HSPA+. In fact at this year’s Mobile World Congress, they even committed to 21Mbps before the end of the year and 42Mbps using HSPA+ in 2009. This is all well and good – but some key topics are never fully addressed in these announcements: end user terminals as well as backhaul and core upgrades.
User terminals: I was looking through Telstra’s website and I could not locate any device/user terminal that supported HSDPA at 14.4Mbps. I am not sure what the point of the upgrade is if there are no terminals that can leverage the network’s capabilities. In fact, Telstra seems to be mainly promoting their walled garden services (such as BigPond Mobile and Mobile FOXTEL) on their Next G network. Even for this HSPA+ press release, it is not clear what end device prototypes were used for the interoperability testing – the only piece of available information is that Qualcomm’s MDM8200 is the chipset in Ericsson’s HSPA+ infrastructure solution.
Backhaul and core upgrades: The press release has a reference to “planned Ethernet backhaul” – no additional information. There was also a pithy press release in June about Telstra activating 3G Direct Tunnel in its core network. In Direct Tunnel, the bearer traffic flows from RNC directly to the GGSN, bypassing the SGSN. Only the signaling traffic is processed by the SGSN. This requires a software upgrade of all the 3 elements – RNC, SGSN and GGSN and the benefits are not entirely clear since it is still quite aways from the flat IP architecture.
Atleast, Telstra’s shiny network boasting the highest coverage (close to 99%) is allowing it to charge premium prices. Telstra’s 1GB plan for mobile broadband costs almost three times as much as Optus’ comparable plan. According to Forrester Research, Next G mobile broadband service is one of a few that Telstra will not consider discounting – even for its largest customers. Surprisingly, it does not seem to have affected its HSPA market share. Telstra had 3.525 million HSPA subs at the end of 2Q 2008, representing a market share of ~88 percent. With the other operators increasing their coverage and driving prices down aggressively, this space should be interesting to watch.
Update: Sierra Wireless announced it is working with Australia’s Telstra, Qualcomm and Ericsson to deliver the first 21Mbps HSPA+ devices. Sierra said shipments for customer trials are expected to begin in the coming months with a commercial launch to follow. If enough vendors announce support for HSPA+ in the near term, it could spell trouble for WIMAX.