Product Assessment: Report Date: Analyst: Service: Market: Class: Current Perspective:

ZT E - ZXSDR 8000 Family

February 09, 2012 Gubbins, Ed Service Provider Infrastructure Mobile Access LTE eNodeB

Summary
Buying Criteria

Current Perspective ZTEs LTE base station portfolio is competitive in the market. W here capacity is concerned, the vendor has done a good job in matching its base station performance w ith operators requirements thanks to the step-by-step scalability of its BS8700 and its tw o purpose-built low -capacity base stations. But the vendors other high-capacity base station, the BS8800, compares poorly w ith competing gear w hen it comes to its mass and space efficiency, and the vendors tw o low -capacity base stations lack any capacity scalability of their ow n. ZTEs current LTE solution set consists of four indoor base stations, the ZXSDR BS8700, BS8800, BS8906 and BS8908. The BS8700 is a distributed base station consisting of a baseband unit (BBU), the B8200, and support for up to 18 R8882 remote radio units (RRUs). The BS8800 is a full-sized, integrated macro base station consisting of a BBU (B8200) and radio system unit (RSU82). The 8700 can scale to support 18 carriers at 20 MHz, w hile the 8800 can reach 12 carriers. ZTE positions these tw o base stations as its high-capacity solutions. The vendors low -capacity LTE base stations, the BS8906 and BS8908, support a maximum of one LTE carrier at 20 MHz. The vendor also has a high-capacity outdoor solution, the BS8900A. ZTEs solutions promise to efficiently meet operator capacity scaling requirements w ithout asking operators to buy more capacity than they need. The BS8700, for example, scales from one to 18 LTE carriers, one carrier at a time, w hen deployed in 20 MHz channels. Each added RRU supports another single carrier. The vendor also offers purpose-built low -capacity base stations that also promise to avoid overkill a particularly appealing feature for the smaller operators that make up a signification portion of ZTEs base. ZTEs high-capacity portfolio raises some concerns, how ever. Its BS8800 is the heaviest LTE base station on the market, w hich could encumber installation and incur added labor or equipment costs. In addition, the BS8800 promises 22 carriers per square meter of floor space the low est space efficiency in its product class. That fact could give operators concern over the level of value theyre getting for their investment. In addition, operators may see ZTEs success in racking up LTE customers overshadow ed by rivals touting major highprofile deployments w ith AT&T and Verizon. Such marquee references not only help establish a vendors credibility in the LTE market, but they can be used to overcome individual w eaknesses perceived in a vendors product portfolio, as vendors can claim their products have passed the ultimate test.

Strengths and Weaknesses

Strengths Purpose-Built Low -capacity Base Stations: Unlike many of its competitors, ZTE offers solutions specifically designed for low -capacity deployment scenarios: the BS8906 and BS8908. Both base stations deliver a maximum of one LTE carrier at 20 MHz. Both are completely enclosed smallfootprint solutions, promising easy deployment. ZTEs early Weaknesses Mass: ZTEs BS8800, w hen supporting 12 LTE carriers, has a w eight of 250 kg, the heaviest base station for this class. Even in a single-cabinet configuration, it remains one of the heaviest solutions on the market at 135 kg. Heavier base stations can pose the potential threat of more difficult and costly installation.

support of this new er small-cell form factor helps it stand out from competitors and gives it an advantage as operator interest in small-cell solutions increases. Space Efficiency: ZTEs BS8700 delivers 18 LTE carriers in a 0.1 m2 footprint, w hich equates to a near market-leading 180 carriers per square meter of floor space and reflects its distributed architecture. Capacity density represents the number of carriers supported by a base station in a given amount of floor space. Since base station real estate is at a premium, LTE base stations that can support a high number of sector-carriers in a small space provide OpEx savings. Radio Receive Sensitivity: ZTE claims that its ZXSDR BS8700, BS8800 and BS8906 can all support a radio receive sensitivity level of -108.8 dBm. This is one of the better radio receive sensitivity figures reported by the major LTE infrastructure vendors. Sensitivity is important in terms of a base stations ability to hear signals coming from the end-user. Base Station Capacity Scalability: ZTEs BS8700 can scale from one to 18 LTE carriers w hen deployed using 20 MHz channels. The base station uses a distributed architecture and can support 18 remote radio heads in total. The addition of each remote radio increases base station capacity by one carrier. This step-by-step scalability allow s the vendor to match its base station performance to operator requirements w hile helping to prevent operators from over-buying capacity.

Space Efficiency High-capacity BS8800: ZTE 8800 supports 22 carriers per square meter of floor space, the low est figure in its product class. This performance calls into question the BS8800s value in a portfolio that also includes the highly space-efficient BS8700. Capacity density represents the number of carriers supported by a base station in a given amount of floor space. Since base station real estate is at a premium, LTE base stations that can support a high number of sector-carriers in a small space provide better OpEx savings. Transport Options: ZTE is the only vendor not to report STM1 or OC3 support for circuit transport. A w ide range of transmission and backhaul options enables mobile operators to leverage multiple transport netw ork architectures and assets, ensuring the backhaul w ill support new data services, aggregate traffic onto higher capacity links for cost savings, etc. This lack of STM1/OC3 support could hurt the vendor w ith operators looking for this circuit transport option. Capacity Scalability Low -Capacity Base Station: Both of ZTEs low -capacity base stations the BS8906 and BS8908 -- support only one LTE carrier using a 20 MHz channel. W hile one carrier might be good for meeting an operators low -capacity requirements early on, as usage scales, neither of these base stations can increase their capacity support. Scaling capacity w ith the BS8906 or BS8908 w orld require the addition of more base stations. Limited Track Record Low -Capacity Base Station: ZTEs BS8908 became commercially available in Q1 2011. W ith rivals such as Alcatel-Lucent and Huaw ei claiming low capacity solutions available since 2010 and 2009, respectively, ZTEs base station has a more limited track record in live commercial netw orks than more established solutions. Lack of Marquee W ins: W hile ZTE claims 18 commercial LTE contracts, it suffers from a lack of marquee w ins. Its biggest references to date have been w ith CSL of Hong Kong (commercial as of November 2010), w here the vendor already had a previous relationship, and Hi3 in Sw eden. Though small operators, w hich make up a significant portion of ZTEs base, may see this as less of an issue, preferring a vendor w hose time is not monopolized by giant customers, marquee deployments help publicize a vendors abilities and give operators confidence in choosing it as a partner.

Point and Counterpoint

Point Huaw ei w ill point out that the space efficiency of ZTEs BS8800 falls w ell behind that of its ow n tw o frame-based solutions, the BTS3900 and BTS3900L. The BS8800 has a space efficiency ratio of 22 LTE carriers per square meter versus 66.7 LTE carriers and 133 LTE carriers per square meter for the BTS3900 and BTS3900L, respectively. Since many mobile operators have to rent equipment space at their base station sites, limiting the floor space needed to support their end-users helps to minimize OpEx. Point Alcatel-Lucent and Ericsson w ill challenge ZTE on the w eight of its high-capacity BS8800 base station, arguing that its 250 kg mass may make installation more difficult and thus potentially more expensive. The vendors w ill point to their ow n high-capacity solutions as lighter alternatives w eighing 143 kg (ALU) and 160 kg (Ericsson) promising easier installation, requiring less equipment and few er people. Point Alcatel-Lucent w ill be quick to point out that its low capacity solution, the 9916 BU, can scale to three LTE Counterpoint ZTE w ill say it offers its BS8700 for operators concerned w ith space efficiency. Thanks in part to its distributed architecture, the BS8700 has one of the best space efficiency figures on the market, w ith 180 carriers per square meter.

Counterpoint ZTE w ill counter that the 250 kg w eight of its BS8800 comes from the addition of an extra cabinet needed for increased capacity. W ithout the addition of the second cabinet, the BS8800 only w eighs 135 kg, a figure lighter than both Alcatel-Lucent and Ericssons comparable offerings. Furthermore, the lighter BS8800 delivers six carriers at 20 MHz, three more carriers than either Ericsson or ALU. Counterpoint ZTEs counter to this w ill be that its tw o low -capacity solutions are designed specifically for small-cell solutions,

carriers, w hile ZTEs tw o base stations, the BS8906 and BS8908, are both limited to one carrier each. W ith three carriers, ALU w ill say, operators can scale their netw orks more efficiently w ithout having to purchase as many base stations as they w ould by using ZTEs LTE solutions.

w here ease of deployment is just as important as capacity and coverage. Operators concerned over scalability could use its BS8700, w hich is similar to ALUs 9916BU in design but promises support for 18 LTE carriers in total.

Buying/Selecting Criteria
Base Station Capacity

High-capacity Base Station - LTE Carriers: ZTEs ZXSDR BS8700 and BS8800 support up to 18 and 12 carriers at 20 MHz, respectively (and a higher number of carriers available w ith smaller spectrum channels). Only Huaw ei and NSN explicitly promise more capacity. The BS8700 uses 18 RRUs to reach its maximum capacity, a configuration the vendor says it doesnt recommend, as most operators dont have the spectrum to support it. Greater capacity allow s operators to accommodate traffic grow th w ith their existing infrastructure investments, controlling CapEx. Low -capacity Base Station - LTE Carriers: ZTEs ZXSDR BS8906 and BS8908 both deliver one carrier at 20 MHz, the low est capacity reported by vendors that offer low -capacity solutions. Extra carriers can be added through low er-sized spectrum channels. Low -capacity solutions provide operators w ith an option to extend capacity into hard-to-reach areas cost-effectively: inside buildings, along highw ays or in areas w ith limited traffic volume. GSM TRX: ZTEs tw o high-capacity base stations deliver capacity of 60 GSM TRX, a figure bested only by Nokia Siemens Netw orks and Huaw ei. ZTE has also promised future GSM capacity increases w ith C-RAN configurations and a new BBU, the B8300. In addition, the vendor claims its BS8906 low -capacity base station can support a market-leading figure for that product class: six to 60 TRX; how ever, this appears to be based on a configuration not typically deployed due to the use of more remote radios than the vendor recommends for the BS8906. ZTEs other low -capacity eNodeB, the BS8908, only supports LTE. GSM capacity is important to operators in that it allow s them to migrate from 3G to LTE at their ow n pace. W CDMA Carriers: ZTEs BS8800 delivers 24 carriers of W CDMA, and the BS8900 promises 30 carriers w ith help from a secondary cabinet. But even 30 carriers is exceeded by nearly all major competitors. ZTE has promised future W CDMA capacity increases w ith a new er BBU, the B8300, and C-RAN architectures. The low -capacity ZSSDR BS8906 supports 24 W CDMA carriers; how ever this appears to be delivered in a configuration not normally deployed. W ith all three base stations, ZTE has the ability to deliver capacity levels needed to remain competitive. Capacity Scalability: ZTEs tw o LTE base stations, the ZXSDR BS8700 and BS8800, promise scalable capacity in terms of carrier support. The BS8700 can support the addition of 17 RRUs for a total of 18 RRUs. The addition of each radio increases capacity by one carrier at 20 MHz. This step-by-step approach to adding capacity helps operators avoid overbuying capacity. The BS8800 has a secondary cabinet that allow s carrier capacity to be doubled, reaching 12 carriers at 20 MHz.

RF Performance

Output Pow er: ZTE reports a maximum output pow er of 2x40 W for the BS8700, BS8800 and BS8906. Other pow er options include 2x10, 2x20 and 2x30 W . W hile ZTE does not promise the 60 to 80 W levels that its competitors do, it does promise multiple pow er options instead of merely scaling back from a higher level. This keeps an operator from paying for a higher output level than needed. In addition, some other vendors offering an 80 W option may simply use it to deliver 2x40 W , matching ZTE. Pow er output represents a base stations ability to push RF signals out to users. High output pow er enhances coverage by extending cell reach or penetrating deeper into structures. Radio Receive Sensitivity: ZTE reports its LTE base station family, w ith the exception of the BS8908, delivers radio receive sensitivity in a range of -108.8 dBm to -103.5 dBm, based on channel size. The upper limit of that range represents one of the better receive sensitivity figures reported by major vendors. ZTE did not provide receive sensitivity data on the BS8908. Though RF pow er output is important for getting RF signals out to users, strong receive sensitivity allow s a BTS to hear signals from low -pow er devices (e.g., handsets). Spectrum Support: ZTEs ZXSDR BS8700, BS8800 and BS8906 all support nine different spectrum bands. W hile some vendors support additional bands that ZTE does not, including 2300 MHz and AW S (especially useful in North America), ZTE should be able to meet most operator requirements. The BS8908 has more limited spectrum support 800, 900, 1800 and 2600 MHz. The more spectrum bands available w ith a base station, the more deployment scenarios it can support. Antenna Configurations: ZTEs high-capacity solutions support 2x2, 2x4 and 4x4 MIMO, along w ith SISO. The vendors low -capacity base stations all support 2x2 and 2x4 MIMO, SISO and SIMO. Only Huaw ei reports support for more MIMO varieties. W hile the near-term need for higher orders of MIMO appear limited, support for them does provide operators w ith investment protection. Multiple Input/Multiple Output (MIMO) antenna support is a critical feature of LTE, allow ing for better coverage and/or better capacity.

Site Deployment Flexibility

Space Efficiency High-Capacity: ZTEs BS8700 delivers 18 LTE carriers in a 0.1 m2 footprint, w hich equates to a near market-leading 180 carriers in a square meter. To be fair, ZTEs distributed architecture gives it a space advantage over frame-based solutions. ZTEs 8800 supports 22 carriers in a square meter, the low est figure in its class. Capacity density represents the number of carriers supported by a base station in a given amount of floor space. Since base station real estate is at a premium, LTE base stations that can support a high number of carriers in a small space provide OpEx savings.

 Outdoor Adjuncts: Three of ZTEs LTE base stations (the BS8700, BS8906 and BS8908) can be deployed either indoors or out. The company also offers its BS8900A for outdoor deployments. W hile most deployments favor indoor base station placement, the availability of an outdoor adjunct allow s the vendor to address a greater range of deployment scenarios. The availability of outdoor adjuncts is fairly common across infrastructure vendors. Mass High-Capacity: ZTEs BS8700 w eighs 22 kg the mass of the BBU alone -- a very light figure reflective of its distributed architecture. The BS8800, how ever, is not so light; at 250 kg, it is the heaviest base station for this class. Even the one-cabinet configuration is one of the heavier solutions on the market, at 135 kg. Low er mass base stations generally benefit from greater ease of installation. Remote Radio Support: ZTE, like all of its major competitors, offers remote radio support. The BS8700, BS8800 and BS8906 come w ith remote radio support. Pow er output for all three is 2x40 W . Distributed base station solutions allow for netw ork coverage/capacity in areas that cannot support a full base station deployment. It is good for hard-to-reach areas. Transport Options: All of ZTEs base stations, except for the BS8908, support up to 16 T1s for circuit transport and ATM, ATM IMA and 100bT/Gigabit Ethernet for packet transport. The BS8908 only supports 100bT and Gigabit Ethernet. Notably ZTE is the only vendor not to report STM1 or OC3 support for circuit transport. A w ide range of transmission and backhaul options enables mobile operators to leverage multiple transport netw ork architectures and assets, ensuring the backhaul w ill support new data services, aggregate traffic onto higher capacity links for cost savings, etc.

Technology Evolution and Market Position

GSM/W CDMA Support High-Capacity Base Station: ZTEs tw o high-capacity LTE base stations support both GSM and W CDMA along w ith LTE on the same baseband unit. This support is not dynamic, how ever, as capacity for each standard is pre-assigned in the BBU and cannot be fluidly adjusted. None of ZTEs rivals promise dynamic support either. But operators look for multi-standard solutions to help them migrate from one generation of netw ork technology to the next. GSM/W CDMA Support Low -Capacity Base Station: ZTEs low -capacity LTE base station, the BS8906, supports GSM, W CDMA and LTE on the same baseband unit. As w ith the high-capacity solutions, capacity in the BS8906 is pre-assigned betw een the different supported technologies and cannot be changed on the fly. The BS8908 is just an LTE base station and does not support other w ireless technologies. Multi-standard solutions allow ZTE to take advantage of economies of scale by spreading base station development costs across multiple w ireless technologies. CDMA2000 Support: W hile not as common as GSM/W CDMA, some infrastructure vendors have multi-standard solutions that support CDMA2000 alongside LTE. The benefits of this multi-standard support are the same as w ith GSM and W CDMA. ZTE provides a multistandard solution that supports CDMA2000 w ith LTE on its BS8700, BS8800 and BS8906. Multi-standard capacity allocation is the same w ith CDMA/LTE as it is w ith GSM/W CDMA/LTE. Market Momentum: As of November 2011, ZTE claimed 28 commercial LTE contracts and more than 90 test netw orks. This is more contracts than ALU or Ericsson have claimed (though the latter stopped releasing such numbers in 2011, and both have reported major deployments such as AT&T and Verizon W ireless) but less than those claimed by Huaw ei and NSN. ZTEs highest profile w ins are w ith CSL in Hong Kong and H3G in Austria. It also boasts a deployment in Sw eden for Hutchison 3G notable for being based on dual-mode FDD/TDD LTE.

Metrics
High-Capacity BTS - Indoor
Model Name Components ZXSDR BS8700; ZXSDR BS8800 Distributed base station, consisting of BBU B8200 & RRU R8882/R8880A/R8884;full sized integrated macro base station consisting of BBU B8200 & Radio System Unit RSU82 ZXSDR BS8700; ZXSDR BS8900A "BBU 88.4x482.6x197 mm, RRU 420x340x105mm; 950x600x450 mm, 700x600x450 mm (2nd cabinet)" 0.1 m2 or zero w hen w all mounted; 0.27m2 22kg (BBU6.75Kg + RRU 15Kg); 135 to 250kg No, but can add up to 17 RRU for extra capacity; Yes, w ith addition of secondary cabinet for higher capacity 18@20MHz; 6@20MHz

Outdoor Adjuncts Dimensions Footprint Mass Multi-chassis Max LTE Carriers per Frame Max LTE Carriers Spectrum Support Receive Sensitivity Output Power Options Antenna Configurations

18@20MHz; 12@20MHz All: 700MHz, 800MHz, 850MHz, 900MHz, 1700MHz, 1800MHz, 1900MHz, 2100MHz, 2600MHz All: -108.8 dBm @ 1.4MHz channel bandw idth, -105.0 dBm @ 3MHz channel bandw idth, -103.5 dBm @ 5MHz/10MHz/15MHz/20MHz channel bandw idth All: four scales: 2x10W (free of charge) , 2x20W , 2x30W , 2x40W All: SISO, 2x2, 2x4, 4x4

Remote Radio Support Circuit Transport Packet Transport GSM Support WCDMA Support CDMA2000 Support TD-LTE Support Commercial Availability Simultaneous Multi-Standard Support Other Models

All: yes max 2x40W (four scales: 2x10W (free of charge) , 2x20W , 2x30W , 2x40W ) All: 1 x 100bT/GigE, 16xE1 All: ATM, ATM IMA, 100bT, GigE All: 60 TRX 24 SC; 24 SC (30 w ith extra cabinet) 36 SC; 48 SC Yes, supports 18x20MHz carriers (MIMO 2x2); w hen supports 8 antenna beamforming, it can support 6x20MHz carriers Yes, End of Q2 2010 All: Simultaneous support - yes, Dynamic support - no

No

Low-Capacity BTS - Indoor and Outdoor

Model Name Components Outdoor Adjuncts Dimensions Footprint Mass Multi-chassis Max LTE Carriers per Frame Max LTE Carriers Spectrum Support Receive Sensitivity ZXSDR BS8906; ZXSDR BS8908 Micro compact base station, consisting of BBU B8200 and RSU82; fully enclosed and compact ZXSDR BS8906; ZXSDR BS8908 650 x 320 x 480mm; 380 x 320 x105mm 0.15m2; 0.03 m2 <50Kg; 15Kg No, but can add 17 RRU for extra capacity; No All: 1 @ 20MHz, 2 @ 10MHz, 3 @ 5MHz

All: 1 @ 20MHz, 2 @ 10MHz, 3 @ 5MHz 700MHz, 800MHz, 850MHz, 900MHz, 1700MHz, 1800MHz, 1900MHz, 2100MHz, 2600MHz; 800MHz, 900MHz, 1800MHz, 2600MHz -108.8 dBm @ 1.4MHz channel bandw idth, -105.0 dBm @ 3MHz channel bandw idth, -103.5 dBm @ 5MHz/10MHz/15MHz/20MHz channel bandw idth; No data provided 2x10W (free of charge) , 2x20W , 2x30W , 2x40W ; 2x10W SISO,SIMO, 2X2, 2X4, 4x4; SISO,SIMO, 2x2, 2x4 Support for remote radio heads w ith 2X40W ; No 100bT/GigE, 16XE1; 100bT/GigE ATM, ATM IMA, 100bT, GigE; 100bT, GigE 6 to 60 TRX; No 24 SC; No Yes, 8 SC to 36 SC w ith external RRUs; No Yes, 1 carrier at @20MHz; No Yes; Q1 2011 All: Simultaneous support - yes, Dynamic support - no

Output Power Options Antenna Configurations Remote Radio Support Circuit Transport Packet Transport GSM Support WCDMA Support CDMA2000 Support TD-LTE Support Commercial Availability Simultaneous Multi-Standard Support Other Models

ZXSDR BS8220 (Pico, indoor and outdoor version)ZXSDR BS8210 (Femto)

Other
Major Customer Wins Miscellaneous As of November 2011, 28 commercial LTE contracts, more than 90 test netw orks ZTE LTE marketing messaging includes the follow ing: smooth evolution based on multi-mode support, large capacity at the BBU w ith low TCO, industry-leading technology, compact design, energy savings, low er OpEx, and tailor-made end-toend solution.

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All m aterials Copyright 1997-2012 Current Analysis, Inc. Reproduction prohibited without ex press written consent. Current Analysis logos are tradem ark s of Current Analysis, Inc. The inform ation and opinions contained herein have been based on inform ation obtained from sources believed to be reliable, but such accuracy cannot be guaranteed. All views and analysis ex pressed are the opinions of Current Analysis and all opinions ex pressed are subject to change without notice. Current Analysis does not m ak e any financial or legal recom m endations associated with any of its services, inform ation, or analysis and reserves the right to change its opinions, analysis, and recom m endations at any tim e based on new inform ation or revised analysis. Current Analysis, Inc. 21335 Signal Hill Plaza, Second Floor, Sterling, VA 20164 Tel: 877-787-8947 Fax : +1 (703) 404-9300 Current Analysis, Inc. 2 rue Troyon, 92316 Sevres Cedex , Paris, France Tel: +33 (1) 41 14 83 17 http://www.currentanalysis.com