Wireless service providers (WSPs) have spent over 120 Billion Euros on UMTS licences. In addition, WSPs will need to invest in UMTS infrastructure and also the systems that enable the UMTS networks and services to operate efficiently.

So is UMTS still a good investment? The answer is clearly yes.

There are two main factors driving the launch of UMTS networks by WSPs.

The first factor is speed. The target data rates for UMTS are:

• 144 kbps-Satellite and rural outdoor
• 384 kbps-Urban outdoor
• 2048 kbps-Indoor and low range outdoor

The maximum theoretical speed of UMTS is far in advance of the data speeds offered by its predecessor technologies, as shown in Figure 1.

Figure 1. Data Rates

These UMTS data rates will be required as the number of bandwidth-thirsty user applications increase. Also, for corporate users, the ability to download their email and calendar in seconds will ensure the UMTS data rates are utilized to the fullest.

The second factor is the lower cost in delivering voice. The cost of a WSP delivering voice via UMTS is greatly reduced from delivering voice via GSM. The capacity of a UMTS Node B is on average around eight times greater than that of a GSM BTS for a unit cost of 1-1.5 times that of a GSM BTS. These cost savings can be passed directly to the end subscriber or can be used to improve the Operating Margin of the WSP.