HSPA will retain dominance for next five years despite LTE hype

MELBOURNE, AUSTRALIA: Despite the hype around LTE high-speed mobile broadband technology, HSPA will retain its dominance for at least the next five years, according to Ovum.

Forecasts from the independent telecoms analyst show that HSPA connections will hit 1.87 billion by 2015 and grow at a compound annual growth rate of 46 percent. The technology’s share of high-speed connections will increase from 31 percent in 2009 to 59 percent in 2015, and as a proportion of total global connections it will grow from 4 percent in 2009 to 25 percent in 2015.

In Asia-Pacific, HSPA connections will reach over 829 million while LTE will only hit over 121 million. Most of the Asian LTE connections will be located in developed markets such as Japan and Korea and in Chinese main urban areas.

However, in the region, HSPA/HSPA+ will remain the most used Mobile Internet access technology, in particular in developing economies thanks to the economies of scale of the more mature technology.

Julien Grivolas, Ovum principal analyst and author of a new report, said: "With LTE grabbing so much attention it is easy to ignore the fact that HSPA is a firmly established technology with a mature infrastructure and device ecosystem. Its other advantage is that is has a natural upgrade path in the form of the enhanced HSPA+, which is being deployed in ever-greater volumes in 2010 and will keep getting better and better. Indeed, HSPA+ and its future enhancements could be sufficient for many operators’ needs for the next five years.

"There is a huge amount of hype surrounding LTE and we expect it to really take off in 2012. However, HSPA will not go out of fashion and mobile operators are not about to turn their backs on it any time soon. The technology is continuing to evolve and operators will keep enhancing their networks for as long as it makes good economic sense."

According to the report, LTE will become the dominant technology in the future, but HSPA will not disappear and many operators are in no rush to migrate. Grivolas said: “HSPA+ and its enhanced evolutions should not be viewed as competitors to LTE, but rather as complementary technologies.

For example, in Australia, Telstra, who already launched HSPA+ services at 42Mbps, sees lots of opportunities in keeping enhancing the performances of its HSPA NextG network while introducing LTE as a complementary hot spot solution when spectrum will be made available.

"Ultimately, the availability of spectrum is certainly an issue that will have a strong bearing on the commercial success of LTE, as its availability is fundamental to service launches. With that in mind, it may pay for operators to hang back and let others invest in the development of the ecosystem and make mistakes first."