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Single antenna interference cancellation (SAIC) is a very interesting and promising technology currently being standardized in 3GPP as part of GERAN Release 6. This interference reduction technique takes advantage of the latest developments in signal processing and receiver algorithms in a cost-efficient way. In most advantageous interference conditions, SAIC can improve the signal-to-noise ratio over 10 dB. We investigate the effect SAIC on the capacity of a typical GSM network. Also, an overview of SAIC algorithms is presented and a new interface for mapping the link and network simulator is described. The network level performance of SAIC is evaluated from both the quality and capacity point of view by using a sophisticated burst-level dynamic network level simulator. The simulations are performed in a synchronized frequency hopping macro cell network. The simulations results verify that the high link level gains can be turned into significant network capacity gains.