Alcatel-Lucent Goes “Radical” with lightRadio – Maybe Too Radical?

| Feb 7, 2011 | Mobile Access Infrastructure | Analyst: Peter Jarich

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Event Summary

February 7, 2011 – Alcatel-Lucent announced “lightRadio” - a set of technologies aimed at new RAN architectures. Core components include: lightRadio cube, a compact antenna technology with integrated amplifier; multi-standard baseband SoC development; new compression algorithms; and controller platform virtualization software. Products include wideband active array antennas, multi-band RRH, compact baseband units, distributed controllers and common management systems available from 2012 to 2014.

Quick Take

Analytical Summary

• Current Perspective: Moderate on Alcatel-Lucent’s new lightRadio launch. There can be no denying that what Alcatel-Lucent is proposing is a radical shift in how wireless networks are built – one that speaks to trends like the need for small cells, IT-telco synergies, multi-standard base stations and energy efficiency. Ultimately, however, it is just a vision. To the company’s credit, it’s a vision that is well aligned with a focus on small cells and partners such as HP. Yet it isn’t 100% novel (baseband pooling and active antennas have been talked about for years) and one that will take upwards of three years to realize. Perhaps more importantly, it’s a vision that is announced with a combination of different value propositions, different products and different technologies used to build those products. The result is something so broad and so deep that most operators will have a difficult time understanding exactly how lightRadio will fit into their networks and how it will impact Alcatel-Lucent’s existing RAN portfolio.

• Vendor Importance: Very high to Alcatel-Lucent, because the company needs to differentiate itself in an increasingly competitive wireless infrastructure market. The need for broad interoperability between network and client devices has made wireless infrastructure a market dominated by standards. To this end, differentiation is often difficult, particularly as new functionalities such as multi-standard RAN gear quickly becomes commonplace. Network architectures, however, are one space for differentiation. As LTE networks come on-line and represent a break from the 3G past, Alcatel-Lucent has an opportunity to raise its profile. It also has the assets (e.g., RF R&D, small cell focus, IT partnerships, optical expertise etc.) to differentiate around network architectures. To this end, the vendor needed to bring these pieces together, especially before competitors could begin making similar claims. At the same time due to the resources ALU is dedicating to lightRadio, such as an R&D heavy six-month enhancement cycle, failure to fully deliver on its vision could derail its current moment and severely damage the company’s public image.

• Market Impact: High on the wireless infrastructure market if only because Alcatel-Lucent has gotten a jump on competitors who will doubtless be telling similar stories in the near-to-medium term. Active antennas, small cells, multi-band antennas, multi-technology baseband and controller pooling - the value of these innovations is well understood. To this end, while competitors may not possess all of Alcatel-Lucent’s core technologies, they will all claim similar programs. The fact that Alcatel-Lucent got a jump on the space with such a broad vision statement, however, puts the competition in a defensive posture which may be difficult to address from a messaging standpoint given the imminent arrival of Mobile World Congress. Of course, if the announcement were a little less “vision” and a little more commercial reality, the real impact would have been much greater.

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