The Wireless Industry’s Best Kept Secret: The Price of a Base Station

While being at the 3GSM congress last week, I used the opportunity to visit my publisher and to pick up a couple of good books which will keep me entertained in the weeks to come. One of these books is "HSDPA/HSUPA for UMTS" by Harri Holma and Antti Toskala.

If you ‘only‘ want to get a good overview of HSDPA (and UMTS), you might want to take a look at my book first. If, however, you want to get the nitty gritty details, read the standards (like I did before writing my book, but not really recommendable as you’ll die of boredom or confusion unless you are a die hard like me) or Harri’s and Antti’s book. In chapter 7 on HSDPA bit rates, capacity and coverage, they feature an interesting mathematical formula on how to calculate the CAPEX (capital expenditure) cost per giga byte transmitted over HSDPA depending on the price per base station (or price per TRX to be exact).

They concluded that at a price per base station (Node-B) with six transceivers of around €100.000 (which includes the partial price of the RNC and core network serving this base station) the CAPEX cost would be around two to four Euros per GB of data traffic. An interesting number! Be careful, however, as the OPEX (operational expenditure) part of the cost is still missing. Also, the formula does not take partly loaded networks into account. They also give the price per GB of data traffic for other network / base station prices as well.

So what’s the cost of a UMTS base station these days? I did some research on this on the Internet but came up almost empty handed. Seems to be quite a well kept secret. The only reference I could find on UMTS and GSM base station prices is in an article on Unstrung from 2004. Here, Brett Simpson of Arete Research LLC is quoted giving a price for a UMTS base station in 2004 of $24.000. It seems rather low to me. Anyone got other sources?

For more on network capacity and cost take a look at my "The 1 kb/s 3G surfer" blog entry.

2 thoughts on “The Wireless Industry’s Best Kept Secret: The Price of a Base Station”

  1. interesting computation at 4 euros per GB capacity. this is definitely an interesting number. a low one to me 🙂

    a $24,000 BTS cost sounds reasonable to me too without the supporting RNC elements and underlying core network elements.

    a significant amount of the CAPEX cost really covers core network components i believe.

  2. It is a well kept secret, but I’m told prices are now below the number quoted in the article (for a 3-sector config).

    Certainly, as the industry has globalized, every operator now wants close to India or China pricing.

    To some extent it has become a moot point, since 70% to 80% of the cost of site is now about the civil works etc, and not the base statsion electronics per se. Hence we’re seeing more interest in “zero-footprint” architectures and such like.

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