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The objective of this report is to provide clear picture of 3G to the readers by answering couple of questions related to 3G 3rd Generation of standards for mobile telecommunication. i.e. What is 3G., what are the 3G standards?, what are the features of 3G(for subscribers)?, Network's deployment issues/hurdles for operators?, Who will gain profits from the deployment of 3G network?, who will be the loser?, Is there any regulatory issue?.
The report has been prepared with the help of my practical work experience in the telecom sector and background knowledge.
The report shows that apart from so many financial and technical hurdles, 3G have added many benefits to subscribers around the globe and make their life quite easy. In Pakistan, the telecom regulatory board, Pakistan Telecommunication Authority (PTA) don't give 3G licence yet and planning to issue 3G licence to operators till mid 2011.
3G is third generation of standards defined by International Telecommunication Union (ITU) for cell phone and telecommunication/wireless services. As cleared from the name, 3G has passed two generation in the way, 1G and 2G/2.5G. Each one adds extra features and flexibility to the previous one. 1G was analog transmission and implement AMPS based on Frequency division Multiple Access (FDMA), introduced to the market in 1980s. Instaphone were one of the leading operators in 1G with good selling brand of cell phone in Pakistan (cell phone with a small antenna at the top). After the analogue communication, 2G come up with digital transmission in 1990s with some extra features like Short Messaging Services (SMS), Multimedia Messaging Services (MMS), general Packet Radio Services (GPRS) and then Enhance Data rate for GSM Evolution (EDGE) or more common name is Enhanced GPRS. GPRS and EDGE are not strictly the features of 2G. Mobilink (subsidiary of Orascom) first introduce 2G service in Pakistan followed by Ufone (Etisalat). 2G has two different parts, and different multiplexing techniques. One is GSM Technology and second is IS-95 . GSM is based on TDMA while IS-95 is based on CDMA.
The problem of low data rate with the preceding standards has been solved by the 3G. According to International telecommunication Union (ITU) specification, 3G provide data rate of 2Mbps for still user while 384kbps for user in moving vehicle. 3G provide the value-added services like access to World Wide Web (www), video call, video conferencing, mobile TV, video on demand and Location based services.
3G has two different standards, IMT-2000 and UMTS (will discuss these two is detail in latter sections of this report), According to ITU, 3G has two families 3GPP and 3GPP2 and based on CDMA technology. The latest WiMAX technology also added to 3G because it meets to IMT-2000 standards. Packet-switching are used for data transmission instead of circuit switching. With many other advantages, the good thing about 3G is that it is backward compatible with 2G such as GSM standards, more flexible with different standards adopted in international market, affordable for subscribers and the network will be design in a way that less immune to extension when the number of user increase. 
Background and problem motivation
Wireless telecommunication network is from 1980s and having three generation till now, 1G, 2G and 3G. Each has some good things in and also some deficiency or weak points. Each time the new generation overcome the drawbacks of the preceding generation, like 2G overcome the weakness of 1G and 3G counter the short comes of 2G. It takes around 10 years of hard work in ITU to bring with a new standards.
The ever first cellular network introduced was 1G (First generation) in 1980s. It has the capability to transmit voice data at a speed of 9.5 kbps. This system has two families, Advance Mobile Phone System (AMPS) for USA and Asia and Nordic Mobile Telephone (NMT) for Nordic countries and Europe. It is analog system and based on FDMA (Frequency Division Multiple Access). Due to the analog nature of 1G, it has some short come like improper use of available spectrum, low sound quality and also not supports encryption.
Next in the queue is 2G or second generation of mobile network. Personal Communication services (PCS) is the second name for 2G. Due to the digital nature of 2G, it comes up with the solution of short comes of 1G. It support encryption (encrypt voice data), efficient in spectrum usage and along with voice service it support data service and introduce Short Messaging Services (SMS). It introduce the concept of modulation which means that the voice data can be digitised first (in the form of binary bits) and then to radio signal. Different 2G technologies have implemented around the globe, Time Division Multiple Access (TDMA), Digital Advance Mobile Phone System (DAMPS) and Code Division Multiple Access (CDMA) is some US states while Europe, Asia and Africa use the Global System for Mobile Communication (GSM).
The last and top at the list of cellular communication is the 3G (third generation). It comes up with high speed internet browsing, video telephone, AVAS (Advanced Value Added Services), and simultaneously provide voice and data services. It provides a data rate of 2Mbps for fixed user which is much higher than 2G (114 kbps). 3G based on CDMA. Different countries use different version of CDMA, like wise Europe use W-CDMA, USA use CDMA 2000, while China use Time Division synchronous CDMA (TDS-CDMA). Only existing network up gradation is required to shift from 2G to 3G (no need to deploy a fresh 3G network using ITM-2000 standards) as 3G has backward compatibility. But the life of 3G is in risk, because people start thinking about 4G. 
The over all aim of this project is to provide an overview of third Generation cellular network and its deployment, legal and financial issues and potential in the local market of Pakistan. I will try to illustrate the 3G architecture, different standards and network architecture with respect to those standards. Will also focus on the market players, who will get profit from the deployment of 3G network and who will be the unlucky loser.
The whole report is divided into three chapters. First chapter will give introduction and background of 3G; will also provide the overall aim of this report. Second chapter will deal with 3G network architecture and different standards. Third chapter will give an overview of 3G in the local market of Pakistan in terms of deployment issue, financial issue and potential in the local market (in subscriber's point of view). Chapter four will give the conclusion of this report. References to websites will be given at the end of this report.
3G network and standards
3G has two families of technologies; 3GPP and 3GPP2 both are based on CDMA. International Telecommunication Union (ITU) has provided specification of two standards, UMTS and ITM-2000. UMTS require deploying a new 3G network and allocate new frequencies, while ITM-2000 is backward compatible and need to upgrade the existing 2G GSM network to meet the requirement of 3G.
What is UMTS?
UMTS is one of the 3G standards for cellular network. It belongs to 3GPP family under the ITU standard ITM-2000. UMTS is a packet switch network and support to digital voice, text data and multimedia date at the speed of 2Mbps. UMTS network has 3 main parts, User Equipment (UE), universal Mobile Telecommunication System Terrestrial Radio Access Network (UTRAN) and Core Network (CN).
Figure.2.1 UMTS network architecture
Three main components of UMTS are clearly shown in the diagram (figure 2.1). UTRAN is responsible to provide access method for air interface to User Equipment. Base transceiver station (BTS) has an air interface with mobile user and connected to Base station Controller (BSC) via Abis interface. Node B is referred as BTS. Routing, transit and switching of user traffic are the core functionality of Core Network. Home Location Register (HLR), Visitor Location Register (VLR) and Network Management System (NMS) are also parts of the Core Network. All these three terminals are installed inside the Mobile switching centre (MSC). BSC has also contains NMS record of all BTSs connected to that specific BSC. Serving GPRS Support Node (SGSN) is connected to mobile station via BSC and the main function of SGSN is mobility management, packet transfer and routing and to update VLR. Gateway GPRS Support Node (GGSN) is the gateway between internet cloud and GPRS network. When MS want to send data/packet to any valid network, the packet route through SGSN and than to GGSN, where it check the network and then send this packet to the appropriate network via internet cloud. The same procedure repeat when GGSN receive data from internet, it first check, either the user is active or not, it just discard the data/packet if the user is inactive otherwise it pass the data to SGSN which is connected to MS.
What is IMT-2000?
ITM-2000 is the 3G standard created by International Telecommunication union (ITU). The main purpose of ITM-2000 is to provide global roaming to 3G subscribers and allow user to use same number and same handset. It was really a challenging job to deal with different standards and make it available for every incoming global user. As a consequence, five different standards are grouped under the umbrella of ITM-2000.
At this stage is quite difficult to say what is part of the 3G and what is not. Due to limitation of some of these standards, only three out of five give complete network coverage over micro cell, macro cell and pico cell and be considered as complete 3G solution ; CDMA2000, W-CDMA and TD-SCDMA. From the rest, DECT is used for cordless phone in home. UWC-136 is second name for EDGE, which is part of 2.5G. Here we left with three useful solutions for 3G, CDMA2000, W-CDMA and TD-SCDMA.
Figure 2.2 Five different interfaces accommodated in one single standard based on three technologies.
Source:http://www.itu.int/osg/spu/ni/3g/technology/index.html#Cellular Standards for the Third Generation
CDMA 2000 use CDMA channel access to transit data, voice and signalling data between mobile station and the subscriber. CDMA come with different standards, CDMA2000 1X (the core standard of CDMA2000 for wireless interface), CDMA2000 1XEV, CDMA2000 1XEV-DO (use for data transmission over radio signal, mainly for access to broadband internet) and CDMA2000 1XEV-DV. 
The FDD component of UTRA (non satellite part of UMTS) is based on W-CDMA, offer high data rate around 2Mbit/s. It is also used as an air interface in 3G network. To achieve high data rate it use FDD duplexing method and DS-CDMA channel access method. W-CDMA was first used in Japan for commercial purpose.
TD/CDMA or TD-SCDMA are TDD technologies and therefore use unpaired spectrum. TDD is suitable for transmitting web data. Asymmetric traffic is easily accommodated just because of the dynamic assignment of timeslots for uplink and downlink.
Overview of 3G in Pakistan
There are five telecom operators in Pakistan and all are using 2.5 G standards. There are some hurdles for migration from 2.5G to 3G.
1. Legal issue
2. Financial issue
3. Less potential in the local market
The telecom regulatory board, Pakistan Telecommunication Authority (PTA) is not ready to issue 3G licence due to some security issue or due to some other issue, so PTA is one of the big hurdles in 3G deployment.
For every business institution, the most important factor is the "money". To deploy a 3G network or upgrade the existing GSM network to 3G, requires to modify some of the network component or you can say most of the network components because most of the equipment are not dual band i.e. it don't support both 2G and 3G. Different vendors are in the Pakistani market, namely Ericsson, Huawei, NEC, Nokia-Siemens Network (NSN), ZTE and Alcatel-Lucent, and the already installed network by any of these vendor don't provide the functionality to support both 2G and 3G. The new BTS by Huawei has these features to support both 2G and 3G, but the older version has no support. So the big problem is to dismantle the old equipment and replace it with the new 3G supportive equipment will cost much to the operators, but it the same time it is good news for these vendors to earn more money by selling new equipments. Ericsson, Huawei and NSN will get more money in particular Huawei will get the highest ratio, because it has a major share of telecom market of Pakistan. To overcome the low voice quality of 2G, new BTS sites should be installed, which will also cost money to the operator.
According to a local survey, the purchasing power of the inhabitants of Pakistan is decreasing day by day due to the high inflation rate and the world economic crises, so after the huge investment in 3G, it is quite expected that the generated revenue will be much less as compared to the investment.
To summarise the report, it is found that the operator need huge investment to bring 3G on air and need to cross legal barrier, technological barrier, BUT after all, i think the end result will not be of grade "A", means more investment, less revenue which will not be allowed by accounts and finance department.
Definitions of terms & abbreviation
1. ITU (International Telecommunication Union) is an agency of United
Nations for telecommunication issue and standardization.
2. AMPS (Advance Mobile Phone System)
3. FDMA (Frequency Division Multiple Access)
4. GPRS (General Packet Radio Services)
5. EDGE (Enhanced Data Rate for GSM Evolution)
6. TDMA (Time Division Multiple Access)
7. CDMA (Code Division Multiple Access)
8. UMTS (Universal Mobile Telecommunications System)
9. UTRAN (UMTS Terrestrial Radio Access Network)
10. 3GPP (3G Partnership Project)
11. 3GPP2 (3G Partnership Project 2)
12. HLR (Home Location Register)
13. VLR (Visitor Location Register)
14. MSC (Mobile Switching centre)
15. BTS (Base transceiver Station)
16. BSC (Base Station Controller)