Even though Airtel & Reliance Jio Infocomm are in cut throat race to rollout and stabilize their 4G LTE networks, let us theoretically move ahead to discuss how their Multi Band Spectrum War Chest can be used to upgrade network to LTE-A(dvanced) few years from now, at least in “A” Telecom Circles of India.
What is Carrier Aggregation ?
This method allows telcos to combine multiple spectrums within each band, and across bands (such as 900MHz and 2.1GHz) and makes it virtually contiguous (as shown in Figure above – Courtesy – Qualcomm) – this can improve capacity, efficiency, and lead to cost and revenues benefits.
Why Deploy Carrier Aggregation ?
Spectrum is limited everywhere. Total allocations are generally less than or up to 20MHz. Spectrum isn’t always contiguous within a band. Limitations on devices/bands it can cater to. ITU which sets and defines various telco standards, has set mobile data delivery targets for LTE-A, such as 150Mbps+ downlinks. One limitation to achieving this is that telcos don’t have enough bandwidth, whereas CA can allow for virtual expansion of spectrum to be able to offer these speeds. Although these speeds may not be not possible for many devices at this stage, but networks should be able to cater for that.
Going forward, with faster networks such as 4G, people tend to do more data transfer vs the same time spent on 3G networks. This can see customers exceed their data allowances in a shorter period of time (on faster networks). Hence there is potential for telcos to upsell higher usage/volume plans, which can see ARPUs rise, we think.
How is Carrier aggregation Implemented ?
Intra band – it refers to aggregation of bands/ carriers within same frequency which aren’t contiguous.
Inter band – It refers to aggregation of bands/carriers in different frequency. This will be key for some telcos, for example Airtel which has a mix of FDD-2.3GHz spectrum and TDD-1800.
CA is currently limited only to LTE spectrum, while most telco networks are still continuing to support 2G/3G/4G and hence total spectrum pool is spread across these bands. Telcos in Singapore, Australia, Japan, Korea and Taiwan have implemented CA ranging from 800MHz-2.6GHz without much financial impact but these initiatives can improve network quality which can help with revenues and churn.