The global market for wireless base station is growing despite the gloomy economic outlook, driven largely by the Chinese and U.S. market, according to a new report released Monday.
ABI Research reported that base station shipments this year would increase by 14 percent year-over-year, despite the anticipation of a double-dip recession.
The research firm highlighted China and the United States as two markets that would contribute "significant" growth to unit shipments, with the two economic giants investing in different wireless technologies.
In China, the focus is on 3G technology, ABI said. Boosted by the popularity of low-cost smartphones, Chinese operators would more than double the number of 3G subscribers this year.
Meanwhile, in the United States, mobile operators are investing "large amounts" in 4G technology, it noted. Based on various reports, the research firm said Verizon Wireless had installed or upgraded 20,000 to 30,000 base stations over the past 16 months, while AT&T was launching LTE services in major cities around the country and Sprint would replace its existing infrastructure with multi-mode base stations capable of supporting 2G, 3G and 4G simultaneously.
According to ABI Research, operators are expanding their networks to cope with the continuing growth of mobile broadband traffic which is driven by the increasing adoption of smartphones and, to a lesser extent, media tablets.
"Existing networks are struggling to cope with the surge in data traffic, so operators are forced to increase capacity," said Jim Eller, principal analyst for wireless infrastructure. "However, operators are finding new revenue opportunities with mobile data, which more than compensate for decreasing voice revenues, so they are expecting good returns on this investment."
Additionally, by upgrading users from 2G to 3G and 3G to 4G, operators can see more network efficiencies and are able to offer more data services, the report added.
In July, research firm Maravedis reported that the number of Long-Term Evolution (LTE) subscribers was expected to reach 326 million by 2016. FDD-LTE (frequency division duplexing) would be the preferred technology, accounting for 80 percent of user base, while TD-LTE (time division) was projected to make up the remaining 20 percent.