Dell'Oro: LTE, core nets up; routers in slide

The demand for LTE Radio Access Network (RAN) equipment continues to grow rapidly.  During the first quarter of 2012, sales of LTE RAN equipment approached $1 billion, representing an 160 percent increase over the year-ago period.

The LTE RAN market experienced particularly strong growth from North America, Japan, and South Korea, where early adopter network operators are aggressively building LTE networks. Looking forward, the outlook remains positive for LTE RAN market as operators continue to expand their existing LTE networks to accommodate new subscribers and to expand coverage into new markets.
 
Dell’Oro Group estimates that 120 LTE networks will be operating worldwide by the end of 2012, more than double the number at the end of 2011, and the number of LTE subscribers will grow more than fifty-fold, from 7 million at the end of 2011, to more than 370 million by the end of 2016.



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Moble data on the march

The Evolved Packet Core (EPC) market has entered a very strong growth trend that coincides with LTE RAN deployments and LTE subscriber growth.  EPC includes the technologies that enable the delivery of data to and from mobile users’ handsets or terminals.  In the first quarter of 2012, EPC session licenses that enable subscriber capacity on LTE networks grew more than 400 percent over the year-ago quarter.

In anticipation of strong LTE subscriber growth, network operators are purchasing about a year’s worth of licenses when making the initial purchase of EPC equipment, and thereafter purchase additional licenses as customers join LTE networks.  This approach to license procurement contributes to the exceptionally strong growth of EPC in advance of actual subscriber additions.

In 1Q12 session license shipments were balanced on a regional basis, with North America accounting for 35 percent of licenses sold, the Asia-Pacific region generating 34 percent of licenses, the Europe, Middle East, and Africa region 24 and Latin America 8 percent.  We conclude this is an indication that operators around the world are planning significant growth in the number of LTE subscribers.


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Next: Core routers in a slide