PA Consulting and Mercury Computer Systems Findings Reveal Multi-Billion-Dollar Potential Savings in 3G Wireless Infrastructure.

Business/Technology Editors

CHELMSFORD, Mass.--(BUSINESS WIRE)--Jan. 14, 2002

MUD Algorithms Increase Spectrum Efficiency;

Reduce the Number of Base Stations by up to 40%

Mercury Computer Systems, Inc. (NASDAQ: MRCY) and PA Consulting Group, Inc. announced today the findings of a comprehensive study of the impact of innovative multi-user detection (MUD) algorithms on the capacity, coverage and hardware expenditure required in the deployment of third-generation (3G) wireless networks.

Based on the results of a Mercury link-level simulation, PA Consulting and Mercury jointly indicate that base stations operating with Mercury's communications computer, could offer substantial performance and cost saving benefits to both telecom equipment manufacturers and operator companies.

Specifically:

-- Up to 50% improvement in capacity

-- Up to 70% improvement in coverage area

-- Yielding up to 40% reduction in capital expenditures - fewer base stations
required, leading to potential savings of several billion dollars in Europe
alone

-- Lower handset transmit power, improving battery life

-- Annual savings will also be realized in 3G network operational expenses

"Having studied the demonstrable benefits of Mercury's MUD algorithms, PA Consulting has confirmed that operators using base stations equipped with Mercury's MUD implementation could realize significant reductions in the number of base stations needed," said Alan Kolnik, partner at PA Consulting Group, Inc. who directs the company's telecommunications practice in North America. "Our models indicate that there should be similar savings in capital expenditures due to the smaller number of base stations needed and the ability to reuse existing network infrastructure."

"For the past decade Mercury has been the undisputed leader in digital signal and image processing for the defense and medical industries," said Barry Isenstein, vice president and general manager of Mercury's Wireless Communications Group. "Leveraging our vast expertise and leadership in these markets, for the past three years we have been developing adaptive processing techniques to improve spectral efficiency in wireless communications. Until now, the advantages of MUD were mostly theoretical, and affordable implementations seemed distant. By combining algorithm improvements with Mercury's embedded computational expertise, this study proves that MUD should be an immediate requirement and deployed in the next release of 3G base stations."

Technology Backgrounder 

PA Consulting Group applied Mercury's link-level simulation results for base stations equipped with Mercury's processor modules to a 3G network that was overlaid on a modeled GSM network. PA Consulting Group's technical and financial analysis demonstrates that, using real-world constraints and assumptions, Mercury's solution led to 30 to 40 percent fewer base station sites in a coverage-limited network deployment. For a capacity-limited network deployment, the results also showed approximately 33 percent fewer sites were required using the same study parameters.

The ability to reuse existing GSM sites resulted in a reduced number of base stations and infrastructure, creating capital expenditure savings of about 30 percent when deploying a new 3G network. Because base station investments represent the majority of capital expenditures, the savings would amount to billions of dollars when applied to the European market alone.

For a representative sample of a 3G network, the study used a projected 3G network for the United Kingdom's Isle of Jersey. Mercury and PA Consulting Group now have the methodology in place to apply the same analysis to any 3G network. The detailed simulation and analysis focused on the WCDMA standard, but has general applicability to CDMA2000 as well.

Mercury Computer Systems and PA Consulting Group are available for follow-on studies backed by technology demonstrations, and either company may be contacted for additional analysis and collaboration on specific configurations.

A summary of the study is available at: www.mc.com/wireless_communications/index.cfm

An illustration of MUD is available in Mercury's image library at: www.mc.com/press_room/image_library/image_detail.cfm?id=46&category= Applications

About Mercury Computer Systems, Inc.

Mercury Computer Systems, Inc. (NASDAQ: MRCY) is the leading producer of high-performance embedded, real-time digital signal and image processing computer systems. Mercury's products play a critical role in a wide range of applications, transforming sensor data to information for analysis and interpretation. In military reconnaissance and surveillance platforms the company's systems process real-time radar, sonar, and signals intelligence data. Mercury is developing commercial wireless communications solutions in areas such as WCDMA multi-user detection and smart antennas. Mercury's systems are also used in state-of-the-art medical diagnostic imaging devices including MRI, CT, PET, and digital X-ray, and in semiconductor imaging applications including photomask generation and wafer inspection.

Based in Chelmsford, Massachusetts, Mercury serves customers in North America, Europe and Asia through its direct sales force and a network of subsidiaries and distributors.

About PA Consulting Group, Inc.

PA Consulting Group is a leading management, systems and technology consulting firm, with a unique combination of these capabilities. Established almost 60 years ago, and operating worldwide from over 40 offices in more than 20 countries, PA draws on the knowledge and experience of some 4,000 people, whose skills span the initial generation of ideas and insights all the way through to detailed implementation. Additional information about PA is available at www.paconsulting.com.

PA distinguishes itself from its competitors through the range and quality of its people, the depth of its industry insight, its development and use of technology, and also its independence and culture of respect, collaboration, and flexibility working with clients.

Visit Mercury on the Web: www.mc.com

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