Steadfast operation

The prognosis for the major equipment suppliers in 2009 is not good, but despite this Motorola’s Ali Amer and Noel Kirkaldy consider the vendor’s prospects for the year ahead in the Middle East and Africa positively. LTE, WiMAX and FTTx are amongst the reasons why Motorola believes its has made the right technology bets, from which it will weather the global economic storm

In his many years in the telecoms sector, Ali Amer, vice president for the Middle East and Africa for Motorola’s home and mobility business unit, has never seen a global economic slump set to have such an impact on the telecoms sector. He takes some consolation in the belief that the effects of the slowdown will be more heavily felt in North America and Europe than they will be in the Middle East and Africa region. That is not to say Amer believes the MEA region will be without its very real challenges.

“I believe operators are going to look to squeeze the most out of their networks,” Amer states. “Operators are obviously going to look to cost cut, and we need to be able to find ways to be able to facilitate that while still growing our business.”

Amer describes the year 2008 as having been a “terrific” one for the equipment manufacturer in the MEA, having continued to grow with existing customers such as Zain, Orascom Telecom and Etisalat, but also having been able to break into a new customer base, including WiMAX operators Wi-tribe and Atheeb in Saudi Arabia.

And while Motorola’s prediction is that there will continue to be residual demand for further investments in GSM, the technological topology in the MEA region is shifting towards other access technologies such as GPON and FTTx. The vendor’s growing portfolio of WiMAX clients also offers strong growth prospects in 2009 and beyond, while the commercialisation of LTE – forecast for Q409 –is another area of anticipation Motorola expects to gain mileage from.

Motorola’s Kirkaldy says the company has purposely held back talking about LTE until the technology was ratified and ready for commercialisation

“We have grown in the number of contracts we have for services,” Amer explains. “We are helping operators optimise networks, especially new entrants such as Mena Telecom in Bahrain where we have a managed services contract.

”Analysts had suggested that the ongoing programme to separate Motorola’s handset business and its infrastructure business into two independent entities may be a point of weakness competitors in both lines of business could try to maximise during the transition period. Amer remains adamant that Motorola is in a strong position and is still in the position to offer operators long-term commitment and partnership.

“Motorola has a strong balance sheet, and it has not been of concern to our customers that we are undergoing some internal restructuring,” Amer declares.

Having been the strongest single proponent of WiMAX technology, Motorola believes the time is now right to also start highlighting its heavy involvement and backing of LTE, a technology that is simplistically viewed as a rival to nomadic WiMAX.

“The ratification of the LTE air interface by 3GPP took place recently, and this prepares the basis for the commercialisation of equipment in 2009. I estimate the first releases of equipment will start hitting the market in Q409,” says Noel Kirkaldy, Motorola’s MEA director of wireless broadband in the Home and Networks division.

“In the past as an industry, perhaps we have been mistaken for placing the solution ahead of the requirement, but this is definitely not the case with LTE. The tremendous CAGR (consolidated annual growth rate) in broadband data demand means it is a question of when, not if networks will need to be able to support these huge requirements for data,” Kirkaldy adds.

At the end of last month Motorola issued a statement saying that given the continued interest in broadband technologies to deliver rich media experiences in the home and beyond, the company would carry LTE work and expanding WiMAX and fibre-to-the-home (FTTH) deployments into a projected expansion of broadband in 2009.

During 2008, Motorola concluded a number of demonstrations, including the industry’s first CDMA-to-LTE network handoff, and a steady stream of WiMAX and FTTH deployments and products.

Ali Amer (left) with Marwan Alahmadi, CEO of Zain Saudi Arabia, at the signing of a US$335 million turnkey contract to deploy and manage the 2G/3G mobile network

“Motorola is committed to broadband and 4G development and made significant gains in 2008, particularly with LTE to address the mobility demands being driven by consumers looking for personalised media experiences,” said Dan Moloney, president, Motorola’s Home and Networks Mobility business. “We’re looking forward to carrying this commitment into 2009 and leading the market in further development and deployment of LTE technologies.”

And while Motorola says it remains committed to the deployment and expansion of WiMAX projects despite news in the middle of December that fellow WiMAX promoter Alcatel-Lucent had taken a strategic decision to reduce spending on WiMAX, Motorola is also actively staking its claim on the LTE bounty that a number of vendors are banking on coming to pass in the coming 12-18 months.

“Motorola has been conservative but always positive,” Kirkaldy says, describing the company’s approach to maintaining its relevance in the telecoms market. “We are in the business of selling a solution and not a technology, and within the wireless broadband space we see a segmentation of the business amongst alternative providers; new entrants; and the 3GPP2- type operators migrating towards LTE,” he adds.

Given the fact that in recent years the Middle East region has leapfrogged other regions in the world with respect to mobile technology development, Motorola is confident that a similar trend will continue in the area of LTE, as operators in the region look to expand wireless broadband penetration from a relatively low base.

“The Middle East will continue to grow, and there’s a real need for wireless broadband to continue growing in Africa,” Amer concludes. “There’s a demand for new technologies and while I’m not naive enough to think there is not pressure on operators in terms of driving cost out of network operations, I do think there is still a fantastic opportunity for building upon our product roadmap with existing as well as potential customers.”