In this blog post, I’ll outline the differences between LTE, LTE-A and Broadband LTE, and explain how the recent spectrum auction is affecting mobile operators and users.
What are LTE, LTE-A and Broadband LTE?
LTE stands for Long Term Evolution and is a wireless communication standard developed from WCDMA, one of the existing 3G technologies. Mobile communication generations are primarily distinguished by speed; generally, 3G is classified as offering speeds from 144 kbps to approximately 2 Mbps, whilst 4G is classified as offering speeds from 100 Mbps to 1 Gbps. Within this classification, LTE was designed to achieve speeds of around 75 Mbps, whilst LTE-A and Broadband LTE are described as capable of reaching speeds of up to approximately 150 Mbps in theory.
Although there was some debate for a time as to whether LTE met the criteria for 4G, it was classified as 4G after the International Telecommunication Union (ITU) recognised it as such. Crucially, Carrier Aggregation (CA) – a method of combining multiple separate frequency bands to use them as a single band – was conceived right from the design stage of the LTE standard. LTE-A is the actual implementation of this CA technology. Therefore, rather than being a completely separate and entirely new standard, LTE-A is a form that actually applies a feature that was considered from the outset in the LTE standard.
Broadband LTE takes a slightly different approach. Instead of the current service, which uses separate 10 MHz bands for uplink and downlink, this method combines adjacent bands to provide service over a continuous, wide bandwidth. The advantage of broadband is that by widening the continuous bandwidth, a wider bandwidth can be utilised without the need for any changes to the internal components of the terminal. In contrast, CA-based LTE-A requires the terminal to support CA functionality in order to bundle and utilise multiple separate blocks.
To use an analogy, LTE-A can be seen as connecting separate roads located alongside existing roads to use them together, whilst Broadband LTE is a method of widening the existing road to allow more vehicles to pass at once.
Recent spectrum auctions and carrier strategies
The total winning bid amount in the recent spectrum auction, in which the three major domestic mobile operators participated, was approximately 2.5 trillion won. The reason mobile operators are investing large sums of money to secure spectrum is clear. As spectrum directly determines the quality of wireless services and the technologies that can be provided, securing more favourable spectrum allows them to offer better services more quickly than their competitors.
Prior to the auction, each operator held various spectrum blocks. Whilst SKT and LGT had already created the conditions to commercialise LTE-A by utilising part of their existing spectrum, KT was unable to use some of its allocated bands for LTE immediately due to radio interference issues, as those bands were being used by other equipment. Consequently, the key issue in this auction was whether KT could secure a specific block (hereinafter referred to as Block D) to provide broadband LTE services.
If KT secures Block D and introduces broadband LTE, even older handsets will be able to utilise a wider contiguous bandwidth without requiring any hardware modifications. Conversely, operators such as SKT and LGT, which have maintained a competitive edge in LTE-A by utilising CA (Carrier Aggregation) capabilities on the handset side, risk losing their ‘competitive advantage through the sale of new handsets’. Therefore, from the perspective of other telecoms operators, KT securing the broadband spectrum could deal a significant blow.
Looking at the auction results, KT secured Block D for approximately 950 billion won, whilst SKT secured Block C for approximately 1.05 trillion won and LGT secured Block B for approximately 450 billion won. Furthermore, by partially reallocating the locations of its existing spectrum, KT has been able to create a favourable combination whereby KT subscribers using new handsets can enjoy the benefits of both Broadband LTE and LTE-A simultaneously.
However, as telecoms operators must refine their base station equipment and network infrastructure to provide a proper LTE-A service, it will take time to deliver the same quality to all subscribers in the short term. Consequently, immediately following the auction, KT was regarded as being in a favourable position, both geographically and in terms of handset compatibility.
We have now examined the differences between LTE, LTE-A and Broadband LTE, as well as the interests of the telecoms operators regarding spectrum acquisition. We anticipate that a variety of services utilising these technologies will emerge in the future, and we would be interested to hear your thoughts on how the development of LTE-based technologies will transform the telecoms experience.
