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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: mightylakers who wrote (7995)	3/1/2001 10:02:32 PM
From: lkj	Read Replies (5) \| Respond to of 196649

Hi everyone, China Unicom is trying to build a 10 (or 13) million user network with $1.2 billion. Do the numbers add up? Somehow, it doesn't sound to me that such a big deployment can cost so little. While I have never tracked Sprint PCS's infrastructure spending, I was once a Lucent investor, and I vaguely remember that at certain time Lucent had $2.8 billion worth of equipment financing for Sprint PCS. This was probably in the 1997-98 time frame. Sprint PCS also sources infrastructures from others like Nortel, so it is safe to assume that Sprint PCS has spent at least $5 billion on its IS95A network. So how is ChinaUnicom going to put up a 10+ million network for $1.2 billion? I have been talking to Mighty Lakers and a few friends about CDMA deployment to make sense out of these numbers. Assuming that at the peak time of the day, a network could see a peak usage of 20% of its total subscribers, for a 10 million user network, this yields to 2 million CSM channels. Because people are mobile, and users tend to be centered in certain areas than spread out equally, this 20% number needs to be increased to 30%, which yields 3 million CSM channels. After talking to a few people, we have made the assumption that an IS95A base station will be able to support 100 to 120 channels. For pico-cells, the number of channels will be closer to the lower end. Sense Chinese cities tend to be highly populated, I would use 105 channels per base station. For base station price, MightyLakers thinks it should be between $150K to $200K each. I remember that Sulposio has said that a base station could be set up for $50k, but I don't think he included channel card costs. Adding $20K for channel cards, I get a cost of $70k per base station. We will do calculation twice, once for $70K, once for $150K. 3 million CSM channels / 110 CSM channels per base * $150K per base = $4.09 billion 3 million CSM channels / 110 CSM channels per base * $70K per base = $1.9 billion This is only the cost for base stations. Building a network cost a lot more than just buying base stations, so the numbers don't add up. Can anyone point out the mistakes in our calculation. Or, maybe ChinaUnicom is hyping the actual capacity of its planned CDMA network, which will more likely be less than 5 million users than 10+ million users. Khan