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Technology: Broadband Mobility and Communications Infrastructure
Small Cells Coming To A Lightpost Near You
THINK SUMMARY: We have written a primer on small cells following heightened visibility at this year's Mobile World Congress (MWC). We expect a whole new ecosystem to address an upcoming spending shift to small cells. Participants in this area may include 1) ALU, CSCO, ERIC, and Huawei, 2) emerging system/box makers (Ruckus, ip.access, Ubiquisys and Nextivity), 3) chip vendors (TXN and FSL on the macro side, MSPD, BRCM and QCOM on the femto/pico side), and 4) WiFi offload specialists and roaming managers such as Towerstream, iPass, Boingo Wireless and Devicescape. KEY POINTS: • Broadband Traffic Demands New Technologies. We believe that deploying "more of the same" to address growing wireless broadband traffic will lead to diminishing returns and thus see the need for new architectures to deliver broadband data to mobile users. Cloud-based data centers, improved smartphone/tablet designs, and increased demand for mobile data presents daunting challenges to carriers. While we expect carriers to receive new spectrum and upgrade to 4G/LTE, we see increased interest in the use of small cells--3G/4G and carrier WiFi--and also adaptive traffic managment as key technologies to "fill the gap" between growing bandwidth demand and ability to supply capacity. • Expect 4G/LTE to drive an accelerated shift towards small cells. Two years ago, QCOM's CEO Paul Jacobs began discussing the need for "spatial diversity" or small cells two when he suggested that 4G networks would approach theoretical limit of "Shannon's Law" to deliver spectrum over the air waves. At the recent MWC analyst session, Jacobs suggested that carriers will have to "drastically rethink the way they deploy their networks...", predicting as many as one small cell per cellular subscriber over the longer term. • An early beachhead in Femtocells. Femtocells improve 3G/4G coverage for homes or small businesses. AT&T's 3G Microcell (made by ip.access for CSCO) box is shipped by AT&T to users who complain of poor service quality at home. The box is plugged into the home user's broadband connection and instantly offers "four bars" of home signal quality. Recent public commentary by the company indicates "several hundred thousand" femtocells deployed in AT&T's US properties. • Expect Carrier-WiFi to become ubiquitous. At the same time, cell phone and cable operators have begun to deploy carrier WiFi solutions with HotSpot 2.0 which allows for a seamless handover of capacity from the "clogged" 3G/4G networks to the unlicensed carrier WiFi networks. The Wireless Broadband Alliance estimates 1.3M global carrier WiFi hotspots in 2011, growing to 5.8M by 2015. • Small cells a meaningful growth opportunity, in our view. We expect a spectrum of indoor and outdoor coverage/capacity solutions ranging from heavy-iron macro cells which support ~100 users over a 10km base, to smaller outdoor mixed-mode 3G/4G pico cells for capacity in "hotspots" on down to the indoor femto cells. Industry participants have a range of expectations, including ERIC which believes small cells will play a minor role in 20% of the "fully loaded" metro cells, to ALU, which sees as many as 10 picocells per 5M base stations deployed globally, to QCOM, which sees a small cell for every subscriber. Informa forecasts 3.2M small cells in 2012 growing to 62.4M by 2016.
Reason for Report: Industry Update
Mark McKechnie 415-249-1988, email@example.com Ryan Brookman 415-249-1978, firstname.lastname@example.org
Please see analyst certification (Reg. AC) and other important disclosures on pages 17-18 of this report.
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Table of Contents
Overview: Small Cells Possibly Coming Soon to a Lightpost Near You ........................................................................ 3 Mind the Gap – Innovation Required ............................................................................................................................... 4 Network Evolution – 1G/2G/3G; 4G approaches Shannon’s Law Limits ........................................................................ 5 Small Cells: From Macro to Pico to Femto ...................................................................................................................... 6 Market Forecasts: Femto Cells => Pico Cells .............................................................................................................. 10 Key Technical & Business Challenges of Small Cells ................................................................................................... 11 Small Cells: An Emerging Ecosystem ........................................................................................................................... 12
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You’ve been talking about small cells for the past couple of years […] Can you let us know if you think this will be the year of the small cells in the form of either carrier WiFi or picocells? (Mark McKechnie) […] on the small cells stuff, I mean that’s obviously started now with people starting to deploy some of those cells. The issue with the current deployment is that you have interference created between femtocells and the macrocells when you run them on the same frequency. So what we’ve developed is a lot of self-organizing networks and interference management technologies that we’ve put into some of the products that have launched. But in terms of when it’s going to really be a mainstream thing, we do see some operators taking that approach that they are going with a lot of small cells and I don’t think it’s going to be mainstream for a few years yet. […] We really are talking about a pretty radical rethinking about the way the networks are going to be built out. […] So we think that eventually small cells will be kind of the cost of a phone, maybe even cheaper than a phone, that you'll see densification to the standpoint that it's almost maybe 1:1 small cells and phones. (Paul Jacobs, Qualcomm CEO) GSMA Mobile World Congress, 2/27/12
Exhibit 1: Small Cells Possibly Coming Soon to a Lightpost (or Windowsill) Near You
Source: Alcatel-Lucent Metro Cells brochure, AT&T M-Cell website, Ubiquisys website
Overview: Small Cells Coming Soon to a Lightpost Near You
Believe demand for data likely to accelerate with LTE. With the introduction of new 4G LTE services and an increased proliferation of smart phones and tablets, we expect the demand for data to continue to outstrip the ability of networks to support them. Indeed, early reports from users of the new 4G/LTE iPad indicate users are already hitting their 5GB monthly “cap” within two weeks of use. We have coined “the potato chip” law of bandwidth which states simply that better connections and services beget increased demand for data. Thus, 4G deployment will likely exacerbate the data problem rather than fix it as hoped. We view the monthly “cap” as akin to selling a Ferrari with a one-gallon gas tank. Small cells: the evolutionary migration to support broadband mobile data. Just as we saw a migration of cell coverage from highways to golf courses as 1G “car phones” moved to 2G “flip phones”, we expect the density of
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base stations to intensify as we move to 4G “smart phones”. There is really no other way to offer capacity absent the small cell, either through cellular (3G/4G), carrier-WiFi, or more likely a combination of both, in our view.
Exhibit 2: Mixed Mode Small Cell Network Example
Source: Ruckus Small Cell white paper
Mind the Gap – Innovation Required
At stake is the challenge to support the “1000x” (in the words of QCOM CEO Paul Jacobs) growth in anticipated traffic over mobile broadband networks by 2020. Our thesis on the industry is simple: “more of the same” (i.e. increased spending on current network architectures) simply will not work to close the gap between bandwidth demand and network capacity (see Exhibit 3).
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Exhibit 3: Bridging the Gap Between Traffic Growth and Network Capacity
Source: ThinkEquity LLC estimates We see four options to “fill the gap”: 1) open more spectrum to carriers to add more channels to current cells; 2) upgrade from 3G to 4G to improve bandwidth per available spectrum; 3) small cells in the form of 3G/4G picocells and/or carrier WiFi; or 4) adaptive traffic management in the form of deep packet inspection or video processing. Alternatively, policy management or metered pricing could also be used to reduce the demand. Adaptive Traffic Management. While this is a subject for another separate piece, there are companies which offer a new approach to managing the IP traffic intelligently. This includes DPI (Deep Packet Inspection) from the likes of Allot Communications, Sandvine, and Procera. Adaptive Traffic Management companies include Bytemobile, Ortiva Wireless, Vantrix and Media Excel which intelligently adapt video and other content to the available network bandwidth and thus conserve scarce traffic capacity, or Movik Networks, which enables carriers to smartly direct RAN traffic across 3G/4G and WiFi networks. Stay tuned for more on this segment.
Network Evolution – 1G/2G/3G; 4G approaches Shannon’s Law Limits
Running into the theoretical limits of Shannon’s Law. Our ability to transform information – phone calls, music, video, virtually everything – into digital bits of data and to transmit billions of them per second is founded upon the work of Bell Labs and MIT mathematician, Claude Shannon, who developed Shannon’s Law in conjunction with his work. Shannon’s Law deals with the concept of channel capacity and describes the maximum rate at which information can be transmitted over a communications channel of a specific bandwidth in the presence of noise. In essence, it dictates the amount of data compression allowable over a specific bandwidth and provides a template for the high density data networks. As 4G approaches the theoretical Shannon’s Law limit of 6 bits/second per Hz, the industry needs to resort to increased spatial diversity in the form of small cells, in our view.
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Cellular architecture to the n degree. With spectrum and site acquisition the scarce resources for offering cellular coverage, the key innovation in the 1980s and 1990s was spectrum reuse in which a carrier uses the same spectrum over and over across its network of base stations or cells. The first mobile phone network, IMTS, consisted of a huge antenna in the Chicago area which offered 20 miles of mobile phone coverage with just one base station. This of course was analog and could initially only support approximately 25 simultaneous calls. To add more “capacity”, the concept of a “cell” was born in which the carrier reused the same scarce spectrum over many cells, each of which could support the same 25 users, thus 10 cells could support 250 users. 2G, 3G and 4G all added to the efficiency of the networks by squeezing more “bits” out of the scarce spectrum, which is measured in Hertz (Hz).
Exhibit 4: Wireless Technological Evolution, 1983-2028E
Source: Qualcomm reports and estimates
Small Cells: From Macro to Pico to Femto
Cellular coverage (otherwise known as the Radio Access Network or “RAN”) has traditionally consisted of big-iron Macro Cells, produced by the incumbent equipment players such as ERIC, NSN, ALU and Huawei. The network deployments involve deployment of large macro cells which support roughly 100 users simultaneously over an 1 to 10 km coverage radius and typically involve anywhere from 20W to 50W transmitters. We expect the network to evolve to a wide range of products of all shapes and sizes from “femto” cells for indoor coverage, to “pico” cells for outdoor network coverage in dense urban areas: macro cells – outdoor carrier cells; picocells – outdoor cells in the carrier network which support 10-30 users over a less than 200m radius with a 1W to 20W power range; or femtocells – generally for homes or small businesses and support 2-10 users in a 20W to 50W power range.
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Exhibit 5: Usage of Small Cells in the Mobile Network
Source: Small Cell Forum
Exhibit 6: Geographic Footprint – Macro, Pico, Small, Femtocells
Source: ThinkEquity LLC
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Exhibit 7: Examples of Macro, Small and Femtocells ERIC RBS6000 macro cell Ruckus WiFi + LTE small cell ip.access femtocell
Source: AT&T Wireless
Carrier WiFi vs. 3G/4G. The two competing small cell solutions include 1) carrier WiFi and 2) 3G/4G small cells. We also believe mixed-mode small cells will become the norm, as a carrier who secures the real estate and backhaul for a small cell will want to offer 3G/4G for voice and Carrier WiFi for data. Carrier WiFi makes a lot of sense as it uses unlicensed spectrum, handsets all generally support WiFi, and WiFi silicon costs have come down to hit the sweet spot, in our view. Additionally, the new “HotSpot 2.0” standard offers automatic authentication for smart phone users tied to their SIM account at a carrier. Thus as an AT&T wireless subscriber, the carrier can automatically connect or offload a user to WiFi when an AT&T WiFi cell is available.
Exhibit 8: BelAir Networks Carrier WiFi Example
Source: BelAir Networks white paper
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Exhibit 9: Range of Products and Players in the Macro/Small Cell Industry
Cell Architecture Macro Geographic Coverage 1-10km # of Users ~100 Output Power 500mW Switch/Router Providers ALU ERIC NSN Huawei (private) Broadband Chip Suppliers TXN FSL BRCM RF Suppliers MXIM LLTC ADI PWAV custom-designed
BelAir Networks (ERIC)
SWKS RFMD Scintera Networks (private)
ip.access (private) Nextivity (private) Ubiquisys (private)
Picochip (MSPD) BRCM (Percello)
Source: Company reports and ThinkEquity LLC
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Market Forecasts: Femto Cells => Pico Cells
Assessing the Ramp Divergent Views: From QCOM to ERIC. We generally see the market for small cells as 2012 being a year of continued femtocell deployments with 3G/4G trials and aggressive carrier WiFi RFPs; with 2013 and beyond marking the ramp of picocells into carrier networks. Most bullish is QCOM, who two years ago pointed out that 4G’s modulation schemes would approach the theoretical limits of Shannon’s Law and that spatial diversity or small cells would be required to fill the gap between accelerating traffic growth and the ability to support this with current network architectures. In response to our question at MWC, QCOM indicated that it eventually expected small cells to approach the cost of a phone and “… almost maybe 1:1 small cells and phone”…pretty radical rethinking, in our view. Informa forecasts 60M+ small cells by 2016. Informa’s February 2012 report anticipates total small cell unit shipments rising from 3.2M this year to 62.4M in 2016 with 95% of them still being the small femtocells. The report finds that small cell deployments are set to be dominated by femtocells with the installed base to grow from 2.5M in 2012 to 59M in 2016.
Exhibit 10: Femtocell Access Point Forecast
Source: Informa data and estimates
Mobile Experts weighs in with precision. A 2011 Mobile Experts study revealed the following projections: sales of about $1.5B worth of small cell gear for wireless backhaul in 2016; enterprise and public area picocells are set to grow from 140K in 2012 to 540K in 2016, a 4x increase; and public access small cells which are mostly installed outdoors and encompass microcells and metrocells are set to grow from 595K in 2012 to 2.9M in 201 (+480%). In addition, the study noted that between 2012 and 2015, public access small cells should evolve from traditional designs to next generation models. The study also indicated that in 2011, femtocells deployments numbered 21; there are three thus far into 2012. Additionally, we highlight increased adoption rates amongst service providers with deployments growing to 39 total providers in 23 different countries during 1Q12, with eight of the 10 largest mobile operators now offering femtocell services.
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Motivations for small cell deployment. A December 2011 report from Infonetics highlights the catalysts for small cell deployments in the enterprise. As we anticipated, optimization of an existing local deployment highlights the leading driver amongst respondents. The survey indicated that operators are expecting to double the percentage of small cell station units from 6% in 2011 to 12% in 2012.
Exhbit 11: Leading Small Cell Deployment Drivers
AT&T actively deploying femtocells. Recently, at the Mobile World Congress in Barcelona, AT&T announced the intention to test small cells within its network later this year along with the announcement that it presently counts “several hundred thousand” Cisco femtocells in its existing network. AT&T began offering Cisco femtocells in April 2010. The device acts as a miniature base station, allowing users to tie AT&T service to their home internet connection
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Exhibit 12: Femtocell Deployments and Commitments – Number of Carriers, 3Q10-1Q12
Key Technical & Business Challenges of Small Cells
Integration with Macro Cells --- SONs (self-organizing networks). The biggest technical challenge for 3G/4G small cells is seamless integration with the macro network’s “plumbing”. At issue is both the “hand outs” in which a live call is handed off from a small cell to the macro network, and “hand-ins” in which a live call is handed off from the macro cell to a small cell. We see a range of attempts to solve the challenges, with some vendors offering their own small cell controllers which connect back to the macro network’s BSC (base station controller), while others rely on support from ALU, ERIC and NSN to manage the handoffs. We are also seeing a lot of work in “self-organizing network”, or “SON” technologies, in which the network becomes aware of the small cell deployment and then “self organizes” its power levels across the cells to maximize the capacity of the full system over a fixed amount of spectrum. Site Acquisition. This represents the major business challenge of small cells – namely carriers need to acquire the small cell sites at a ground level in-order to deploy the small cells which can be placed on street poles, within offices, or even on billboards in densely populated regions. In conjunction, small cell “box makers” need to offer unobtrusive (read: small) form factors to allow for unobtrusive deployments that do not create eye-sores. Backhaul. The final ramp limiter of small cells is the backhaul challenge – i.e. routing the signals from a small cell back to the network. This is no small task. Our industry checks suggest ~ 15Gbps of bandwidth from all three of the French 3G operators supporting ~60M total subscribers. These same carriers saw a spike to 60-70Gbps within months of deploying their carrier WiFi solution. The cells can be connected via the existing broadband/Ethernet connection (DSL, Cable Modem), fiber or more likely millimeter wave / point to point backhaul over the licensed (i.e. 24-80GHz) or unlicensed (i.e. WiFi bands). Again, the connection and associated antenna would need to be small and unobtrusive. Then, of course, the bandwidth needs to be managed over the system to deliver low-latency service to the subscriber.
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As shown below, Infonetics’ qualitative analysis into service provider obstacles associated with deployment of femto/small cells indicates the transition from a macro-centric environment to next-generation solutions remains the key technical challenge in the deployment of small cells.
Exhibit 13: Top Barriers to Femtocell and Small Cell Adoption
Small Cells: An Emerging Ecosystem
Our industry study has revealed a burgeoning ecosystem of players ranging from the incumbent telecom equipment players, to emerging small cell systems players, backhaul innovators, tower companies, and chip/technology players. We see an ongoing struggle between the incumbent macro cell ecosystem with diverging views on the small cell disruption, and the emerging challengers who are leading the innovation curve and threaten to shake up the overall industry structure. Thus, the bigger players are looking to move downstream into the growth-oriented small cell market, while the emerging players are innovating in with fresh approaches to a new market opportunity. If history serves us well, we have a feeling the faster-running emerging companies will ultimately “win the innovation race” and ultimately grow into big companies themselves, or get “taken out” as their products take hold in carrier networks. As an example, the "about face” within Ericsson which fought the carrier WiFi trend for years before capitulating with its recent BelAir Networks purchase for its positioning as a carrier WiFi leader may serve as a good example of an innovator creating value. Cisco, at the other end of the spectrum, has tried for years to break into the radio access network recently shook up the industry with its small cell product line announcement at Mobile World Congress.
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Exhibit 14: The Small Cell Ecosystem
Source: Informa We’ve seen this act before, and have an inkling that the smaller players may be the ones to watch. Below, we lay out our view of the small cell ecosystem: Primary Participants – ALU, ERIC, NSN, Huawei. The macro base station vendors have long spoken of the “HetNet”, or Heterogeneous Network, in which a spectrum of radios / base stations ranging from 3G/4G, carrier WiFi and pico/femtocells will be used to effectively provide coverage and capacity across the geographic topologies. ALU’s “lightRadio” architecture uses the “cube” as a key RF building block in pico to macro cells with various configurations depending on the deployment requirements. All appear heavily invested to become the “system integrator of choice” to the global carrier community. ERIC’s recent acquisition of carrier – WiFi play BelAir Networks illustrates the urgency of new thinking in network roll-outs. CSCO’s MWC announcement of small cell product lines reinforces the theme. Emerging Systems Makers. The entrepreneurial efforts are alive and well in small cells with a range of players offering differing approaches are emerging. Ruckus Wireless, a Silicon Valley-based leader in enterprise WiFi systems, is moving aggressively into the small cell space in both carrier WiFi and mixed mode solutions which add 3G/4G. The company’s core competence involves the ability to scale across large user bases by way of its smart antenna technology and controller architecture. Tests done by Tom’s Hardware illustrate the advantages of Ruckus’ system which we have confirmed from various industry sources. ip.access, a UK-based small cell player, has emerged as a leader in 3G femtocells by supporting one of the larger global deployments with AT&T Wireless and its home femtocells that offer cellular coverage to customers with poor signals near their homes. The
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company’s solution includes a wide range of femto and picocells along with a proprietary controller to connect back to the macro network. Ubiquisys, also UK-based, is another emerging leader with a “twist”. Ubiquisys announced its “smart cell” line up at MWC which together with INTC silicon offers a unique solution that offers local caching with ~40G of on-board flash to ease the backhaul burden by caching regularly used content (i.e. video) for a local area. Each of these companies brings their own unique core competencies to the table including “first to market”, unique system architecture where most offer their own controller hardware. Backhaul Players. We focus primarily on the wireless backhaul players but also believe the classic fiber suppliers will feel the additional traffic demand from WiFi/3G small cells. Most of our industry contacts see a large enough opportunity in the standard $8B wireless backhaul space with small cell backhaul as “gravy”. There appear to be some disruptive solutions from newer companies such as Exalt Communications, which may be gaining share by starting with a “clean sheet” to design Ethernet-based solutions and BridgeWave which is aggressively targeting the 80GHz market. Tower Companies/WISPs (wireless internet service providers). Towerstream (TWER) is getting involved by securing real-estate rights in densely-populated metro regions in NYC, Chicago and SF which it plans to lease or resell to the larger carriers including Verizon and AT&T to augment their carrier WiFi footprint. iPass (IPAS) is focused on playing the “middle man” to support global roaming of WiFi users. Devicescape provides WiFi offload capacity through its virtual network of third-party WiFi hotspots based on a given operator’s policy preferences. Chip Makers. We see a classic David vs. Goliath dynamic brewing amongst the chip makers for their fair share of the overall BTS (base transceiver station) silicon space. There is a battle staged between the incumbent macro cell vendors such as FSL and TXN trying to move “down” to the pico/femtocell space, and the small cell challengers starting with a beachhead in femto cells and trying to move “up” to pico cells, but they may not ever make it up to the macro cell. We estimate ~$1,000 of content for the macro cells, which could be higher depending on the number of users supported and power levels and ~$25-$50 for the small cell players. Small cell participants include MSPD, BRCM, and QCOM. MSPD recently bought small cell leader PicoChip to provide near-term 3G femtocell business ahead of its 4G Transcede ramp. Top customers include ALU which showed off a lightRadio cube-based solution with MSPD’s baseband at MWC, ip.access, which resells products through CSCO to AT&T and has 11 carrier relationships, along with some content in BelAir’s (ERIC) dual-mode metro solution. We note that ip.access has begun working with FSL for their 4G solution in the 2013 solution, but believe MSPD’s 3G business has growth ahead and may be able to capture follow-on 4G content. BRCM may have bought Percello for $86M in November 2010 as its play on small cell but also appears to have good internal WiFi capabilities and may be a contender with recent wins at Ubiquisys. QCOM is making a strong push with its FSM small cell solution that gets them back into the infrastructure market and who we believe may be designed into CSCO’s new product line. INTC is showing up with a focus to support “smart cell” solutions from Ubiquisys and may move into basebands with its CEVA-based Infineon division. On the RF/Transceiver side, MXIM and ADI appear positioned with analog transceivers; MXIM’s recent investment in private company Scintera which makes analog pre-distortion products may prove important in achieving price points and scale necessary for broad market deployments of small cells. There also appears to be interest from the traditional RF food chain including RFMD and SWKS in the emerging small cell space as well as privately-held CMOS Power Amplifier companies such as BlackSand, Amalfi, and RF Access.
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Investment Risks. Small Cells represent an emerging technology which we believe may prove disruptive to the overall industry. We see numerous risks or “ramp limiters” which may prevent, slow, or otherwise impact the deployment of small cells relative to our views. Key risks for the industry include 1) carrier capex budgets, 2) technical / integration risks of small cells into the macro network, 3) macro cell advances could accelerate to diminish the relative benefit of small cells, and 4) small cells require real estate site acquisition and backhaul solutions.
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COMPANIES MENTIONED IN THIS REPORT:
Company Allot Communications Ltd CEVA, Inc. Intel Corporation Mindspeed Technologies, Inc. Motorola Mobility Holdings, Inc. Nokia Corporation QUALCOMM Inc. RF Micro Devices Skyworks Solutions, Inc. Exchange NASDAQ NASDAQ NASDAQ NASDAQ NYSE NYSE NASDAQ NASDAQ NASDAQ Symbol ALLT CEVA INTC MSPD MMI NOK QCOM RFMD SWKS Price $22.50 $22.22 $27.93 $5.75 $38.96 $5.07 $67.39 $4.58 $26.38 Rating Buy Buy Buy Buy Hold Hold Buy Hold Buy
Important Research Disclosures
We, Mark McKechnie and Ryan Brookman, hereby certify that all of the views expressed in this research report accurately reflect our personal views about the subject securities and issuers. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed in this research report. The analyst(s) responsible for preparing this report has/have received compensation based on various factors, including the firm's total revenues, a portion of which is generated by investment banking activities. The analyst(s) also receive compensation in the form of a percentage of commissions from trades made through the firm in the securities of the subject company of this report, although not for any investment banking transactions with or involving the subject company. ThinkEquity LLC makes a market in Allot Communications Ltd, CEVA, Inc., Intel Corporation, Mindspeed Technologies, Inc., Nokia Corporation, QUALCOMM Inc., RF Micro Devices and Skyworks Solutions, Inc. securities; and/or associated persons may sell to or buy from customers on a principal basis. ThinkEquity LLC has made affirmative disclosures concerning each of the covered securities mentioned in this report, including analyst holdings (if any), rating definitions and overall ratings distributions. These disclosures can be found in the most recent complete research report for each of the respective companies. Reports are available upon request.
Effective October 7, 2009, ThinkEquity LLC moved from a four-tier Buy/Accumulate/Source of Funds/Sell rating system to a three-tier Buy/ Hold/Sell system. The new ratings appear in our Distribution of Ratings, Firmwide chart. To request historical information, including previously published reports or statistical information, please call: 866-288-8206, or write to: Director of Research, ThinkEquity LLC, 600 Montgomery Street, San Francisco, California, 94111. Buy: ThinkEquity expects the stock to generate positive risk-adjusted returns of more than 10% over the next 12 months. ThinkEquity recommends initiating or increasing exposure to the stock. Hold: ThinkEquity expects the stock to generate risk-adjusted returns of +/-10% over the next 12 months. ThinkEquity believes the stock is fairly valued. Sell: ThinkEquity expects the stock to generate negative risk-adjusted returns of more than 10% during the next 12 months. ThinkEquity recommends decreasing exposure to the stock. Distribution of Ratings, Firmwide ThinkEquity LLC
IB Serv./Past 12 Mos.
Rating Count Percent Count Percent
BUY [B] HOLD [H] SELL [S]
133 53 11
67.51 26.90 5.58
12 1 0
9.02 1.89 0.00
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