Published 3Q Virginia Lee Industry Analyst. Clint Wheelock Managing Director

Transcription

1 EXECUTIVE SUMMARY: Green Telecom Networks Fixed and Mobile Telecommunications Networks: Energy Efficiency, Renewable Energy, Recycling and Reuse, and Carbon Emissions Reduction Opportunities Published 3Q 2010 NOTE: This document is a free excerpt of a larger research report. If you are interested in purchasing the full report, please contact Pike Research at sales@pikeresearch.com Virginia Lee Industry Analyst Clint Wheelock Managing Director

2 Section 1 EXECUTIVE SUMMARY 1.1 Introduction The information and communication technologies (ICT) industry sector is responsible for just 2% of the world s overall greenhouse gas (GHG) emissions and telecommunications accounts for merely 0.6%. While these numbers may seem insignificant, the impact is quite large when coupled with the growing demand for more telecom services around the world. Moreover, the ICT sector has the potential to produce a 15% reduction in total GHG levels by All of these factors point to a serious impact on the world s climate. This Pike Research report focuses on the direct impact of green technologies and practices as applied to telecommunications networks. Specifically addressed are the market drivers and business decisions that drive the usage and implementation of green practices across fixed and mobile networks. In addition, quantitative market forecasts are provided to describe the effects of these green technologies and practices on operational and environmental costs. The goals for a successful green telecom project mirror the objectives for all telecom projects, including: 1.2 Key Findings Reduce energy-related operating expenses for telecom networks by decreasing energy consumption Reduce the capital expenditures related to network deployments Reduce the carbon emissions associated with network operations Increase the utilization of clean energy sources for telecom networks, including solar energy, wind power, and fuel cells Increase the operational efficiency and utilization of networks The key findings of this report include the following: Pike Research forecasts that green telecom network infrastructure investments will represent over 46% of global capital expenditures by 2014 a $122 billion market. Within this market, an estimated 63% of the investments will be for mobile networks by With a need to balance a surging subscriber base with environmental concerns, it is no surprise that the Asia Pacific region will lead the way in green mobile telecom spending, representing over 46% of the total spend by Following on its heels is Europe at an estimated 26% of total green mobile CAPEX by Use of sufficient green telecom technology and practice improvements has the potential to yield substantial reductions in carbon emissions versus business-as-usual. Overall telecom network emissions could be reduced by an estimated 24% by Emissions from mobile networks could be reduced by upwards of 46% by the same year. 1

3 Renewable/alternative energy solutions continue to face return on investment (ROI) challenges due to the higher initial capital expenditure required to implement these types of solutions. However, operators are beginning to shift their business case evaluation criteria to a total cost of ownership (TCO) model, which helps to make the case for using more renewable energy sources such as solar and wind. Within mobile networks, base stations and switching centers may consume 70% to 80% of an operator s network energy usage, so improvements here are critical. As operators and vendors concentrate on improvements in radio frequency (RF) amplifiers, new network architectures and topologies, fresh air cooling solutions, and the use of sustainable energy solutions for off-grid locations, Pike Research forecasts emissions levels will decline to 94 million tons of carbon dioxide equivalent (MtCO 2 e) by 2014 versus an anticipated 141 MtCO 2 e for Fixed networks, outside of access platforms, are not of equivalent concern to operators, mostly due to declining subscriber counts and reduced operating expense levels. However, Pike Research still expects a conservative reduction in network emissions of 15% by This decline is based on technology improvements at the component/board level that could dramatically impact power and cooling requirements. Vendors take a holistic approach to green telecom by offering more than just technological advances. Services such as network and site planning can also reduce the energy needed to run a network. Additionally, in order to make way for newer more efficient equipment, vendors must provide adequate take-back programs for legacy equipment. There are significant emissions reductions to be realized via improvements in data center facility practices. Examples of this include, but are not limited to, sealing cable cutoffs, eliminating underutilized cooling plants, better use of hot/cold aisle layouts, and selective powering off of unused assets. The use of technological advances and improved practices in the IT arena, such as server virtualization, decommissioning of inactive servers, and the use of alternative cooling systems, is expected to reduce emissions. Accurate financial assessment of alternative green network solutions is a complex process that involves fully loaded costs, as well as recognition of the impact that operating expenses and end-of-life (EOL) asset valuations have on the ROI. This evaluation is even more critical in emerging markets where security, fuel transportation costs, sustainable energy solutions, and minimal average revenue per user (ARPU) make the business case more complicated. Green solutions design must properly account for the right combination of energy sources according to the environment, application, and economics behind the solutions. Outside influences, such as the maturity of a country s telecom industry, the extent of government-driven environmental programs, caps on energy access, reliability of the energy grid itself, and user consumption patterns, should also be considered. Beyond technology, a successful green telecom program must include a focus on the materials that make up the products and EOL strategies for decommissioned equipment. Operators are becoming more conscious of the overall environmental impact of the telecom equipment in their networks. To that end, vendors are now reporting in more depth on the handling of hazardous materials, as well as offering takeback programs. 2

4 Section 9 TABLE OF CONTENTS Section Executive Summary Introduction Key Findings... 1 Section Market Issues Green Telecom Market Overview Renewable/Alternative Energy Mobile Networks Energy Efficiency Hazardous Materials and Packaging Recycle/Reuse... 7 Section Technology Issues Definition of Green Telecom Components of a Green Telecom Solution Telecom Equipment and Software Services Energy Efficiency Renewable/Alternative Energy Solutions Energy Consumption Section Standards Bodies and Industry Consortia Introduction to Standards Issues Who Sets the Standards? Standards Guiding Principles for Energy Efficiency Metrics (Data Centers) Base Standard (General Requirements on Energy Efficiency for Telecommunication Equipment [ATIS ]) Future Standards Section Key Industry Players Introduction Vendors Alcatel-Lucent Cisco Systems Ericsson Hewlett-Packard Huawei IBM Juniper Networks Motorola Nokia Siemens Networks PowerOasis Telcordia ZTE Operators

5 5.3.1 AT&T BetterWorld Telecom Bharti Airtel British Telecom China Mobile Deutsche Telekom France Telecom (Orange) NTT DoCoMo Sprint Nextel Telstra Verizon Vodafone...34 Section Market Forecasts Introduction and Approach Fixed Networks Mobile Networks Data Centers Global CAPEX Analysis Key Assumptions and Market Drivers Regional Markets Green Telecom CAPEX Regional Markets Global Emissions Analysis Key Assumptions and Market Drivers Green Practices Regional Trends...46 Section Company Directory Section Acronym and Abbreviation List Section Table of Contents Section Table of Figures Section Scope of Study Sources and Methodology Notes

6 Section 10 TABLE OF FIGURES Chart 2.1 Deployment of Renewable Energy Solutions for Mobile Base Stations by Region: Chart 2.2 Deployment of Renewable Energy Solutions for Mobile Base Stations by Region and Type: Chart 2.3 Electronic Equipment Recycle Rate: Chart 6.1 Telecom Network CAPEX, World Markets: Chart 6.2 Telecom Network CAPEX by Segment, World Markets: Chart 6.3 Mobile Network CAPEX by Region, World Markets: Chart 6.4 Telecom Network and Green Telecom Network CAPEX, World Markets: Chart 6.5 Green Telecom Network CAPEX by Segment, World Markets: Chart 6.6 Mobile Network Green CAPEX by Region, World Markets: Chart 6.7 Telecom Network Emissions by Segment, World Markets: Chart 6.8 Green Telecom Network Emissions, World Markets: Chart 6.9 Green Mobile Network Emissions, World Markets: Chart 6.10 Green Data Center Emissions, World Markets: Chart 6.11 Green Telecom Network Emissions, World Markets: Chart 6.12 Mobile Network Emissions Reductions by Region, World Markets: Chart 6.13 Mobile Network Emissions % Reductions by Region, World Markets: Figure 2.1 Components of Green Telecom Practices... 3 Figure 3.1 Green Telecom Practices by Infrastructure Category... 9 Table 2.1 Deployment of Renewable Energy Solutions for Mobile Base Stations by Region: May Table 6.1 Telecom Network CAPEX by Segment, World Markets: Table 6.2 Mobile Network CAPEX by Region, World Markets: Table 6.3 Telecom Network and Green Telecom Network CAPEX, World Markets: Table 6.4 Green Telecom Network CAPEX by Segment, World Markets: Table 6.5 Green Mobile Network CAPEX by Region, World Markets: Table 6.6 Unabated Telecom Network Emissions Levels, World Markets: Table 6.7 Abated (Green) Telecom Network Emissions Levels, World Markets: Table 6.8 Savings in Mobile Network Emissions Reductions by Region, World Markets:

7 Section 11 SCOPE OF STUDY Pike Research has prepared this report to present an overview of green telecom practices and technologies applied to fixed and mobile network infrastructures, as well as related data center facilities. The objectives of the report are to: Provide an overview of market drivers and a comparison of key players in the green telecom space Provide global and regional green infrastructure CAPEX forecasts ( ) that are reflective of market conditions and technology impacts Provide comparative trends for renewable energy solutions and the reduction of carbon emissions for the green telecom market While this report covers many of the significant players and primary technologies currently available in the green telecom market, it offers only a snapshot of the industry. Pike Research anticipates the industry will face many changes moving forward, and we will publish periodical updates as warranted. SOURCES AND METHODOLOGY Pike Research s industry analysts utilize a variety of research sources in preparing Research Reports. The key component of Pike Research s analysis is primary research gained from phone and in-person interviews with industry leaders, including executives, engineers, and marketing professionals. Analysts are diligent in ensuring that they speak with representatives from every part of the value chain, including but not limited to technology companies, utilities and other service providers, industry associations, government agencies, and the investment community. Additional analysis includes secondary research conducted by Pike Research s analysts and the firm s staff of research assistants. Where applicable, all secondary research sources are appropriately cited within this report. These primary and secondary research sources, combined with the analyst s industry expertise, are synthesized into the qualitative and quantitative analysis presented in Pike Research s reports. Great care is taken in making sure that all analysis is well supported by facts, but where the facts are unknown and assumptions must be made, analysts document their assumptions and are prepared to explain their methodology, both within the body of a report and in direct conversations with clients. Pike Research is an independent market research firm whose goal is to present an objective, unbiased view of market opportunities within its coverage areas. The firm is not beholden to any special interests and is thus able to offer clear, actionable advice to help clients succeed in the industry, unfettered by technology hype, political agendas, or emotional factors that are inherent in cleantech markets. 59

8 NOTES CAGR refers to compound average annual growth rate, using the formula: CAGR = (End Year Value Start Year Value) (1/steps) 1. CAGRs presented in the tables are for the entire timeframe in the title. Where data for fewer years are given, the CAGR is for the range presented. Where relevant, CAGRs for shorter timeframes may be given as well. Figures are based on the best estimates available at the time of calculation. Annual revenues, shipments, and sales are based on end-of-year figures unless otherwise noted. All values are expressed in year 2010 U.S. dollars unless otherwise noted. Percentages may not add up to 100 due to rounding. 60

9 Published 3Q Pike Research LLC 1320 Pearl Street, Suite 300 Boulder, CO USA Tel: This publication is provided by Pike Research LLC ( Pike ). This publication may be used only as expressly permitted by license from Pike and may not otherwise be reproduced, recorded, photocopied, distributed, displayed, modified, extracted, accessed or used without the express written permission of Pike. Notwithstanding the foregoing, Pike makes no claim to any Government data and other data obtained from public sources found in this publication (whether or not the owners of such data are noted in this publication). If you do not have a license from Pike covering this publication, please refrain from accessing or using this publication. Please contact Pike to obtain a license to this publication. 61