LTE spending projected to boom in 2013
1/31/2012 1:56 PM EST
SANTA CLARA, Calif.--Global capital spending on 4G Long Term Evolution wireless technology is expected to reach $24.3 billion in 2013, nearly triple the projected spending of $8.7 billion of 2012, according to a report by market research firm IHS iSuppli.
IHS projects that spending on LTE infrastructure will eclipse spending on 3.5G infrastructure for the first time in 2013. The firm forecasts that 3.5G infrastructure spending will total $19.8 billion next year.
LTE infrastructure spending will continue to rise, reaching $36.1 billion in 2015, compared to $9 billion for 3.5G, according to IHS' forecast.
"While 3.5G remains the dominant air interface technology in the mobile infrastructure market, the 4G LTE space has been gaining momentum," said Jagdish Rebello, director and principal analyst for communications and consumer electronics research at IHS, in a statement.
Rebello said the trend began in the second half of 2009, when some wireless operators in Europe, North America, Japan and South Korea started to deploy LTE technology. About 200 mobile operators worldwide are now trialing, deploying or commercially operating 4G LTE networks, up from about 160 in 2010, Rebello said.
"Such widespread support will drive carrier spending on LTE to surpass 3.5G by next year," Rebello said.
LTE represents a strong revenue growth potential for infrastructure manufacturers and semiconductor suppliers, IHS said. But silicon suppliers must be ready to meet the challenges and demands that LTE solutions place on semiconductors and hardware architectures, the firm warned.
In particular, the 4G networks of the future must evolve to more heterogeneous architectures such as metro cells, which will be used to augment coverage or fill holes in areas of high data traffic, IHS said. These metro cells—also known as small cells—will be used alongside Wi-Fi hotspots to provide coverage in public spaces, IHS predicted.