Strategy 2.0: Lessons from Vodafone’s success in European SMB Communications

Summary:  Vodafone have been quietly stealing a march in the European SMB communications market with a well executed strategy centred on its OneNet cloud-based product. We look at how, including comparisons with BT, Telenor, and others. (May 2012)

     

Below is an extract from this 24 page Telco 2.0 Report that can be downloaded in full in PDF format by members of the Telco 2.0 Executive Briefing service here. Non-members can subscribe here, buy a Single User license for this report online here for £795 (+VAT for UK buyers), or for multi-user licenses or other enquiries, please email contact@telco2.net / call +44 (0) 207 247 5003.

We’ll also be discussing our findings at the London (12-13 June) New Digital Economics Brainstorm where we’ll be joined by Bob Brace, Vodafone’s Head of Cloud and Unified Comms, in the Cloud 2.0 stream.

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Introduction – Challenges and Opportunities in Voice and Unified Communications

Although voice minutes of use are still rising slowly worldwide, it is increasingly the case that the predictions of falling revenues from traditional services are becoming a reality, and sooner than expected. A combination of regulatory pressures, price competition between operators, and disruptive competition from new entrants is crushing margins. 

Figure 1: Skype Punishes Carriers on International Voice

Source: TeleGeography

Most worryingly, the continued huge growth in volumes at Skype and the popularity of alternative messaging options like WhatsApp, BlackBerry Messenger, and Apple’s iMessenger show that the disruption is disproportionately affecting the most profitable segments of the traditional telecoms bundle – international and SMS respectively. 

Increasingly, small and medium-sized businesses (SMBs), another key line of business, are turning to the growing numbers of independent VoIP providers. And, more broadly, voice, messaging, and video conferencing features are being disaggregated and diversified, showing up in all kinds of software, hardware, and Web service contexts – exactly as we predicted in 2007.

Again as we predicted, voice is more and more being delivered as part of a broader communications product. In the enterprise, this typically manifests itself as a “unified communications” (unicomms or UC) application, integrating telephony, voicemail, e-mail, and often also instant messaging, presence-and-availability, teleconferencing, and collaboration tools. This can be delivered on-premises, for example by an Asterisk system or an integrated hardware appliance like the ones Cisco sells, as a Web service (like Huddle or Salesforce Chatter), as a hosted/cloud-based network service, or as a telecomms operator service (like IP-Centrex).

In this context, some operators are not just surviving but succeeding. There is not only crisis here, but also opportunity. Cisco forecasts that there is a world market for $20bn of hosted unified-comms services, making up about 40% of the total “managed” UC market. Vodafone expects a 25% CAGR over the next four years in both UC and cloud services for SMBs and enterprises, with a total European market of $15bn in 2015. As for the broader communications market, BT estimates that the total UK SMB communications market is worth some £29bn from 4.8 million customers.

Figure 2: Cisco estimates $20bn of hosted unified communications, $50bn “managed”

 

Source: Cisco Systems, STL Partners

The drivers are clear – SMB customers are keen to get rid of the costs of owning and managing local PBXes on the one hand, to enjoy the (perceived) low, low prices of VoIP, and also to upgrade their communications services from the early 1990s GSM feature set plus the late 1990s BlackBerry e-mail service to something more in keeping with the age of Google +, the Apple iPhone, and Skype. 

At the same time, operators are in search of new sources of revenue to replace the business and international voice and SMS cash cows. As always, they also need to find applications that sell-through their basic connectivity products. Hardware vendors are keen to extend their own businesses, which are challenged by the availability of open-source software and cloud-based services. And the software and Internet service players are trying, in their turn, to defend against the remorseless drift towards “free”.

In this note, we will discuss three European operators’ response to the challenge and the results, and we will also discuss how the vigorous Voice 2.0 disruptor ecosystem relates to the SMB core market. We will start with an example of success – Vodafone.

Figure 3: Why SMB & enterprise UC is a priority at Vodafone

Source: Vodafone interim report

Vodafone: clear definitions and responsibilities pay off

In the UK, this space is dominated by two players, Vodafone and the ex-incumbent BT. Their results contrast dramatically. 

Vodafone is aggressively promoting a cloud-based UC package, OneNet, to its SMB customers in the six biggest European markets, and looking to roll it out across the wider Vodafone Group. 

Meet Vodafone OneNet: Unified Comms in the Cloud for SMBs

OneNet is a cloud-based unicomms product, which offers single numbers for both fixed and mobile telephony, advanced call management, multi-ring and hunt groups, and voicemail integrated with push e-mail across mobile devices, fixed phones, and VoIP softphones, with a single bill and central account management via a Web interface and a smartphone app. Vodafone also offer Office 365 from Microsoft as an extra cost option and later this year (2012) will offer integration between One Net and Microsoft Lync enabling “click to call from Microsoft applications and the ability to answer an incoming call to a mobile number in Lync.

OneNet Express is a lightweight version of the product for small businesses, offering virtual landline numbers and some call management features, as well as the account management service, for mobile lines only. Both versions of the product are delivered as pure network services, running in Vodafone’s core network.

A Note on the Accounts

Although Vodafone is increasingly keen to boast about its performance in the SMB and enterprise markets, it doesn’t yet provide a line-of-business analysis in its accounts. However, we’ve constructed a roughly comparable data series, based on the growth figures Vodafone does provide, its own statement that 31% of its European revenue is from business customers, and its geographical segment breakdowns. 

A caveat must be introduced in that Vodafone Global Enterprises (VGE), the large enterprise & government business roughly analogous to BT Global Services, is included in the Vodafone series while BTGS is broken out in the BT accounts. BT does not provide a breakdown of BTGS revenue detailed enough to create an identical BT series. However, as we will soon see, it is unlikely that Global Services have contributed enough growth to falsify the conclusion we are about to draw.

In the six OneNet markets (Germany, Italy, Spain, the UK, the Czech Republic, and Portugal) through 2011, revenue growth averaged 4.8%, and it is worth noting that there is substantial momentum. Q1 saw sequential growth of 2.4%, Q2 4.85%, and Q3 7.38%. In the market and economic context, this is a spectacular performance.

Figure 4: Vodafone Is Doing Far Better In The UK

 

Source: STL Partners, Vodafone, BT

In the last 7 quarters, Vodafone’s revenue from UK business customers grew in 6 of them. It beat BT in every one of the quarters we looked at. Not only is it growing quite quickly, while BT’s is shrinking dramatically, it is almost three times as big in absolute terms (although some of this will be down to the differences in segment allocation). 

In Europe more broadly, the same picture is visible even more strongly, with the SMB segment growing at 5-8%% in major markets like Germany and Italy, and accounting for most of the growth in final ARPU. Although Vodafone’s south European interests are in the firing line of the economic crisis, this line of business has been remarkably robust. In the last three months of 2011, service revenue in Italy shrank almost 5 per cent – but revenue from SMBs and enterprises rose 1.9%. At the same time, service revenue in Germany grew 0.3%, but the OneNet target markets grew 5%. In Q2, service revenue in Italy was down 4.1%, but enterprise was up 5.8%, and OneNet itself was growing at 70% annually. In Germany, at the other end of the European economic spectrum, enterprise was up 6.6% year on year compared with total service revenue at 1.2%.

Figure 5: OneNet Markets Doing Rather Nicely, Thanks

Source: Vodafone interim results presentation, November 2011

 

To read the note in full, including the following additional analysis…

• BT: Incumbent or Innovator?
• BT Voice: Volumes Shrinking…
• Two other European operator plays
• Telenor: The Same Factors, the Same Success?
• So, How Did Vodafone Do It?
• Compare and Contrast: Vodafone 360
• The Disruptors: Twilio, Tropo, and friends
• The Future: beyond hunt groups
• Conclusions & Recommendations
• 1: Service design
• 2: Organisational focus
• 3: Channels to market
• 4: Cloud and software power
• The Telco 2.0™ Initiative

…and the following figures…

• Figure 1: Skype Punishes Carriers on International Voice
• Figure 2: Cisco estimates $20bn of hosted unified communications, $50bn “managed”
• Figure 3: Why SMB & enterprise UC is a priority at Vodafone
• Figure 4: Vodafone Is Doing Far Better In The UK
• Figure 5: OneNet Markets Doing Rather Nicely, Thanks
• Figure 6: Enterprise & SMB Outgrowing Vodafone Group Revenues in last two quarters
• Figure 7: BT Group strategic priorities
• Figure 8: BT Organisational Structure – an SMB might touch all of these
• Figure 9: BT Global Services revenues year-on-year
• Figure 10: BT losing call volume in the UK…
• Figure 11: A simple proposition
• Figure 12: Enterprise revenue in Turkey growing 33% sequentially
• Figure 13: Cisco’s view of SMB, Developer, and Enterprise Requirements

Source: http://www.telco2research.com/articles/EB_lessons-vodafone-europe-SMB-comms_Summary

Smallcelling LTE networks

As the LTE World Summit ended today many questions and takeaways are buzzing our heads from the discussions and experts’ opinions.

There were various statements on small cells but all agreed that small cells need to happen and assist on the capacity and forums like 3GPP, Small Cell Forum are setup to succeed and make small cells a reality

Although there is lots of discussion held on small cells around the 60GHz unlicensed band outdoor solution where small cells are expected to be deployed, in reality the truth might be different. When today about 80% of the mobile data traffic is generated between the residence and the enterprise, there is perhaps a small remaining percentage to consider and manage at the street level. How long the user will be travelling and what services will be using that will need capacity, most likely video is important but not crucial. That thought might lead us into an indoor solution pointing to a femtocell, which will cost almost nothing to the operator since power, transmission and hosting will be covered by the consumer. The cost might might be today around $80, but if companies like Cisco, Samsung even NEC seriously work on the electronics, might be even lower. It is really interesting, how Samsung was trying to position itself in the LTE and small cells due to thousands of deployments indoor and outdoor with KDDI in Japan. Today that LTE network is one of the fastest growing in the world and Samsung is expanding in Europe with an office, they just opened in the UK.

Enterprise networks is a different case, as the quality of service produced by macrocells is not acceptable, making HetNets a more attractive solution to support them. This kind of networks is asking for a high QoS and careful traffic handling.

 

 

When it comes to LTE and small cells, there are some recommendations to be further discussed or food for thought.

 

1. For the backhaul, incumbent is in a position to access fiber backhaul, then the regulator’s position is to set the rules of the game

2.More examination of the backhaul considerations, a crucial factor also in the LTE

3.Harmonized regulation, who can actually run a femto?

4. Identify the exact location of the traffic as close as you can, using the right tools to locate the traffic, available in the industry, as Newfield Wireless was presenting during the Summit

5. Today seems to be difficult to roll out hundreds of small cells; the level of the self-configuration devices need to be considered, optimizing the networks to help on this
6. The impact of devices, including support of advanced features, legacy devices, and time need to install small cells

7. Multivendor support, is an idea that big backhaul vendors such as Ericsson didn’t like, to use different macro and small cells vendor, expecting efficient coordination and interoperability between two layers. Standards are needed to clarify the landscape and make interoperability happen!

 

Other factors that are expected to contribute in the small cells could be the M2M growth especially due to the upcoming mHealth and its ecosystem’s evolution, trying to understand the management of all these devices. However it is well accepted that licensed spectrum could be inefficient when using M2M in a macro level.

 

Final note, small cells is still considered a learning process with some hype for operators and needs careful and clear messaging from vendors since it’s a case is different and ‘one technology does not fit all’.

 

Source: http://aravantinos.blogspot.com.es/2012/05/smallcellingthe-lte-networks-as-lte.html

Here’s Why Google and Facebook Might Completely Disappear in the Next 5 Years

We think of Google and Facebook as Web gorillas.  They’ll be around forever. Yet, with the rate that the tech world is moving these days, there are good reasons to think both might be gone completely in 5 – 8 years.  Not bankrupt gone, but MySpace gone.  And there’s some academic theory to back up that view, along with casual observations from recent history.

When I was a PhD student 15 years ago, I studied with Don Hambrick who is a scholar known for a career showing the effects of management teams and directors (for good and for ill) on their organizations’ strategies and performance.  One of the central tenets of this school of thought on organizations is that senior teams and directors have an outsized influence on organizational outcomes.  What’s more, their backgrounds (including education and career paths) have a big effect on how they see the world, various competitive situations and the choices they make.

There’s another school of thought which takes the opposite view called population ecology or organizational ecology which put forward that managers don’t really matter all that much.  This view grew out of sociologists who’d taken to study organizations in the 1970s.  They assert that organizational outcomes have much more to do with industry effects than who the CEO is and the choices he or she makes.  They study birth and death rates of populations of organizations, as well as the effects of age, competition and resources in the surrounding environment on an organization’s birth and death rate.  Most of these organizational ecology scholars come out of the University of California at Berkeley.

As a graduate student, I didn’t have much time for this ecology line of thinking.  I believed in the power of the individual executive to overcome all challenges in the external environment.  We can always point to dynamic CEOs as case studies, even though the sociologists would say those are the equivalent of celebrating the smarts of lottery winners.

As I age and watch what’s happening in the world of Internet and mobile, I can’t stop thinking of these ecologists though.

More and more in the Internet space, it seems that your long-term viability as a company is dependent on when you were born.

Think of the differences between generations and when we talk about how the Baby Boomers behave differently from Gen X’ers and additional differences with the Millennials.  Each generation is perceived to see the world in a very unique way that translates into their buying decisions and countless other habits.

In the tech Internet world, we’ve really had 3 generations:

• Web 1.0 (companies founded from 1994 – 2001, including Netscape, Yahoo! (YHOO), AOL (AOL), Google (GOOG), Amazon (AMZN) and eBay (EBAY)),
• Web 2.0 or Social (companies founded from 2002 – 2009, including Facebook (FB), LinkedIn (LNKD), and Groupon (GRPN)),
• and now Mobile (from 2010 – present, including Instagram).

With each succeeding generation in tech the Internet, it seems the prior generation can’t quite wrap its head around the subtle changes that the next generation brings.  Web 1.0 companies did a great job of aggregating data and presenting it in an easy to digest portal fashion.  Google did a good job organizing the chaos of the Web better than AltaVista, Excite, Lycos and all the other search engines that preceded it.  Amazon did a great job of centralizing the chaos of e-commerce shopping and putting all you needed in one place.

When Web 2.0 companies began to emerge, they seemed to gravitate to the importance of social connections.   MySpace built a network of people with a passion for music initially.  Facebook got college students.  LinkedIn got the white collar professionals.  Digg, Reddit, and StumbleUpon showed how users could generate content themselves and make the overall community more valuable.

Yet, Web 1.0 companies never really seemed to be able to grasp the importance of building a social community and tapping into the backgrounds of those users.  Even when it seems painfully obvious to everyone, there just doesn’t seem to be the capacity of these older companies to shift to a new paradigm.  Why has Amazon done so little in social?  And Google?  Even as they pour billions at the problem, their primary business model which made them successful in the first place seems to override their expansion into some new way of thinking.

Mobile companies born since 2010 have a very different view of the world.  These companies – and Instagram is the most topical example at the moment – view the mobile smartphone as the primary (and oftentimes exclusive) platform for their application.  They don’t even think of launching via a web site.  They assume, over time, people will use their mobile applications almost entirely instead of websites.

We will never have Web 3.0, because the Web’s dead.

Web 1.0 and 2.0 companies still seem unsure how to adapt to this new paradigm.  Facebook is the triumphant winner of social companies.  It will go public in a few weeks and probably hit $140 billion in market capitalization.  Yet, it loses money in mobile and has rather simple iPhone and iPad versions of its desktop experience.  It is just trying to figure out how to make money on the web – as it only had $3.7 billion in revenues in 2011 and its revenues actually decelerated in Q1 of this year relative to Q4 of last year.  It has no idea how it will make money in mobile.

The failed history of Web 1.0 companies adapting to the world of social suggests that Facebook will be as woeful at adapting to social mobile as Google has been with its “ghost town” Google+ initiative last year.

The organizational ecologists talked about the “liability of obsolescence” which is a growing mismatch between an organization’s inherent product strategy and its operating environment over time.  This probably is a good explanation for what we’re seeing in the tech world today.

Are companies like Google, Amazon, and Yahoo! obsolete?  They’re still growing.  They still have enormous audiences.  They also have very talented managers.

But with each new paradigm shift (first to social, now to mobile, and next to whatever else), the older generations get increasingly out of touch and likely closer to their significant decline.  What’s more, the tech world in which we live in seems to be speeding up.  Tim Cook had an interesting line about the velocity of change in his earnings call last week:

through the last quarter, I should say, which is just 2 years after we shipped the initial iPad, we’ve sold 67 million. And to put that in some context, it took us 24 years to sell that many Macs and 5 years for that many iPods and over 3 years for that many iPhones. And we were extremely happy with the trajectory on all of those products. And so I think iPad, it’s a profound product.

Yahoo is already a shell of its 2000 self.  There is increasing chatter (including from me) about how Google’s facing a painful multiple contraction, once its desktop search business (still accounting for the vast majority of its revenues and profits) starts to fall off a cliff as users dramatically drop traditional search for new ways of getting information they want in a mobile world.  Is Amazon destined to decline?  There seem to be no signs of it today and people will still need to buy stuff in a mobile world, but the new mobile platform will certainly open the possibilities for new entrants that Amazon can’t even imagine today.

Facebook is also probably facing a tough road ahead as this shift to mobile happens.  As Hamish McKenzie said last week, “I suspect that Facebook will try to address that issue [of the shift to mobile] by breaking up its various features into separate apps or HTML5 sites: one for messaging, one for the news feed, one for photos, and, perhaps, one for an address book. But that fragments the core product, probably to its detriment.”

Considering how long Facebook dragged its feet to get into mobile in the first place, the data suggests they will be exactly as slow to change as Google was to social.  Does the Instagram acquisition change that? Not really, in my view.  It shows they’re really fearful of being displaced by a mobile upstart.  However, why would bolting on a mobile app to a Web 2.0 platform (and a very good one at that) change any of the underlying dynamics we’re discussing here? I doubt it.

What about Apple?  Where does it fit in to this classification scheme?

Apple is really a hardware company, so it’s difficult to put it into a bucket related to web apps.  It certainly seemed very Web 1.0 with its Ping social application.  Yet it’s succeeded in mobile from making the best hardware and software ecosystem for apps to proliferate on.  In some ways, as long as it has a successful iOS platform, it doesn’t care which Web 1.0, 2.0 and mobile companies fail or succeed on top of it.  Maybe that’s why so many non-mobile companies seem to want to emulate Apple.  Google bought Motorola Mobility (MMI) to get into the hardware business.  Facebook and Baidu (BIDU) are rumored to be launching their own mobile OS.

The bottom line is that the next 5 – 8 years could be incredibly dynamic.  It’s possible that both Google and Facebook could be shells of their current selves – or gone entirely.

They will have all the money in the world to try and adapt to the shift to mobile but history suggests they won’t be able to successfully do it.  I often hear Google bulls point to the market share of Android or Eric Schmidt’s hypothesis that Google could one day charge all Android subscribers $10 a month for value-added services as proof of future profits.  Yet, where are all the great social success stories by Web 1.0 companies?  I imagine we’ll see as many great examples of social companies jumping horses mid-race to become great mobile companies.

It’s a lot easier to start asking Siri for information instead of typing search terms into a box compared to thousands of enterprises ceasing to upgrade to the next version of Windows.  Google’s 76% market share.  Facebook’s 900 million monthly users.  They just aren’t as sticky as they seem.

And does anyone think the pace of change is going to increase in the next 5 years versus the last?  That we’re going to see fewer innovations, fewer start-ups trying more stuff on cheaper and more powerful processing power?  In all likelihood, we could have an entirely new way of gathering information and interacting with ads in a new mobile world than what we’re currently used to today.

The Googles and Facebooks of tomorrow might not even exist today.  And several Web 1.0 and 2.0 companies might be completely wiped off the map by then.

Fortunes will be made by those who adapt to and invest in this complete greenfield.

Those who own the future are going to be the ones who create it.  It’s all up for grabs.  Web monopolies are not as sticky as the monopolies of old.

 

Source: http://www.forbes.com/sites/ericjackson/2012/04/30/heres-why-google-and-facebook-might-completely-disappear-in-the-next-5-years/

Customer Experience Management: like running shoes, a good fit is essential

In this guest post, Nokia Siemens Networks (NSN) argue that customer insight and personalisation are the keys to delivering a great customer experience, supported by two real-world case studies. They draw the analogy that it makes no more sense to offer every customer the same package than to offer every runner the same shoes.

Mobile internet quality used to play only a minor role in customer retention, but this is no longer the case. Network coverage and voice quality were rated as the most important criteria in 2010 and continue to be among the top criteria to retain customers in 2011. The importance of Messaging and Internet Quality increased even for the average user. Customers who are classified as ‘high value customers’ now rank mobile broadband quality alongside voice quality and network coverage in determining to leave or stay with their mobile operator.

In particular, heavy users of advanced services, a customer group that has grown by 34% between 2010 and 2011, care about Messaging and Internet quality. These customers are typically young and the majority of them are high spenders. But are they loyal to their operators? The answer doesn’t look promising. These customers have already switched operators far more often than average, and nearly 40% of them will change their provider within the next year. Even worse, overall satisfaction with the mobile Internet has hit rock bottom. Together with unfavourable contract conditions and the high cost of devices and voice services, poor mobile Internet quality received the lowest satisfaction ratings globally.

Would you accept a one-size-fits-all shoe?

So what can operators do about it? Providing services that fit individual needs is an important first step. Personalization is a clear megatrend across the entire market. People are used to adapting all kinds of user interfaces according to their personal preferences. Many products come in a huge variety to serve even the smallest segment.

Take running shoes. You can buy ultralight marathon running shoes, sport shoes with built-in electronics, or even trainers you can custom design on online portals. This range of choice is just one example of how customer preferences vary from individual to individual. Does it make any sense to offer every customer the same package and the same data rate?

For operators, the capability to personalize their service packages translates into an opportunity to both create new offers and earn incremental revenue. Only a select few customers need hiking books to trek 20 miles a day. Only a select few mobile users want to download five full-HD videos a day.

Nokia Siemens Networks’ A&R study shows that traditional services such as sending/receiving emails, browsing/searching the web, instant messaging and chat and picture messaging are on top of the customer priority list right now. In the future, GPS and security packages will become increasingly important. In practice, these changing needs underline the importance of targeting precious bandwidth to customers who really need it, and are willing to pay for it. Hardly anyone needs a giant pipe all the time, and operators need tools to enable them to personalize and move away from “one-size-fits-all.”

Insight & action provide a personal communication experience that fits

How to personalize their services is the next question that operators need to answer. Insight is crucial here, based on data collected from multiple sources-the network, the service, the device, the usage, the subscriber and the customer experience. By analyzing this insight and creating a feedback loop on a flexible network, they can support their customers throughout the entire customer lifecycle rather than stepping in too late to salvage the customer relationship. In fact, many operators are already taking this approach to improve the overall experience with new personalized offerings, with Telkomsel Indonesia and Bharti Airtel India providing two good examples.

Telkomsel implements right now the recently launched CEM on Demand portal which will provide one single entry point to view real-time experience metrics. This will allow Telkomsel to have a unified view of customer data, along with continuous reporting of customer insights that help it to improve its customers’ experience and generate new revenue streams. Bharti Airtel chose us for a pan-India deployment of our CEM platform which will maintain and store real-time experience metrics for every subscriber in the network enabling Bharti Airtel to proactively cater to customer needs.

To successfully personalize service offerings requires the capability to share insight across different operator departments and organizations. For example, operations may already know that there is a problem with a cell in a crowded shopping mall, but this information has yet to be shared with service desk agents.

To bridge these silos, operators need not only real-time insight, but also the capability to take proactive and automated action in response. In short, they need a holistic Customer Experience Management solution.

With insight about why a connection has failed or a specific service is unavailable, for example, they can inform their customer that they need to upgrade the operating system of their device to support the service they have requested.

Insight about customer preferences makes it possible to offer single sign on to various web services or an even easier sign on process using just a mobile number. Device and security settings can be updated or corrected automatically. Special rates or offers can be promoted to heavy users of specific services. Real-time information can be provided to help-desk agents to help them resolve problems in an instant. Customers can manage and create their own service packages and interact with friends about their service preferences on self service portals.

Taken together, Customer Experience Management solutions enable operators to deliver a highly personalized communication experience that provides the best possible fit with subscriber needs, expectations and preferences. Not unlike those specialized running shoes tailored for speed, performance and satisfaction.

This post was written by Iris Heinonen, Head of CEM Marketing, Nokia Siemens Networks.

Source: http://www.telco2.net/blog/2012/05/customer_experience_management.html

HTML5: market impact and telco strategies

Summary: HTML5 will have a profound impact on consumers’ and businesses’ interaction with the web in coming years. In particular, HTML5-compliant smartphones may lead to a reduction in the power of closed app platforms such as Apple iOS and Google Android. While this seems broadly positive for telcos, there may also be negative side-effects of the increasing capability of standardised (and often free) Internet capabilities.

 

 

Introduction

For the last two or three years, telecom operators – especially in mobile – have been chasing after the “app economy” as a potential source of revenue, as well as the core of perceived threats from the Apple and Google ecosystems. In general, despite a lot of effort and noise, telcos have not really been in a position to benefit from the app explosion, except insofar as it has helped them upgrade customers to smartphones and data-plans. Telco-run appstores have made little headway against the vendors’ centralised storefronts. There have also been downsides, in terms of a shift in market influence to the device vendors, and spiralling traffic and signalling loads from easy-to-use interactive apps on smartphones.

Now, another shift is starting to appear, and the impact on the operator community is still unknown. We see growing traction for a new version of the web’s underlying technology, HTML (HyperText Markup Language). The new standard, HTML5, is already being supported (albeit patchily) in various devices, and allows a web browser or similar software to act in much the same way as a standalone “native” app. It is increasingly possible for a website, or innovative service, to be based on HTML5 – and work across many types of phone or other device – rather than needing to rely on the underlying capabilities of the OS.

Some in the telecoms industry believe that HTML5 gives operators a unique opportunity to reclaim a measure of control over the smartphone’s destiny. It also promises the benefits of true multi-screen applications and services, with browser-based apps working seamlessly across TVs, PCs and other devices as well as phones. But on the other hand, it could also present risks, strengthening other players such as Amazon or Facebook, while presenting telcos with yet another set of challenges for which they are organisationally ill-prepared.

This document gives an outline of why HTML5 is important for the telecoms industry – and how telcos can attempt to skew he impact towards exploitable opportunities, rather than accelerating threats.

What is HTML5 and how does it differ from earlier versions of the web?

HTML5 is the latest version of the standards used for displaying content and running applications from the web. The key standards body behind it is the Worldwide Web Consortium, also known as W3C. It is a huge upgrade to the previous variant HTML4, which has been used (albeit with ongoing enhancements) since 1997 – pretty much the whole history of the popular, mass-market Internet. 

In particular, HTML5 incorporates many of the extra functions that have been layered on top of the web in recent years. These are add-ons which have made it more interactive and akin to a computer programming language, rather than just the content-display (“markup”) capabilities it had previously. If you think back maybe five years, much of what we now take for granted online didn’t really happen. We didn’t get self-updating and scrolling pages (think of the Twitter Timeline), forms that reconfigure the page or download background content while you’re typing (e.g. Google’s auto-complete). All those are driven by tools such as JavaScript, which lets code “execute on the page”. The term “Web 2.0” was coined to describe the more-interactive services that are common today.

HTML5 takes that concept much further, allowing the web to be used as the basis of “full applications”, which can:

• Work offline (when the device is not connected to the Internet).
• Access underlying device functions such as the camera or phone-book. (This is also being worked on by WAC – see later in the document for how this fits with W3C’s efforts)
• Replace the use of some proprietary plug-in functions, such as Adobe Flash for vector graphics and video playback.
• Work across different smartphone and browser platforms (at least in theory), meaning that developers do not have to re-code their apps (“port”) between different phones’ operating systems.
• Break the dependency on locked appstores (especially Apple) and permit much wider distribution and discovery via the Web instead
• Allow web apps to be standalone “widgets” or be integrated into other applications, rather than merely running “in the browser”.
• Be developed (in theory) by a much broader community of web developers than those who specialise in particular device platforms.

Technically speaking, HTML5 is separate from ongoing evolution of both JavaScript as the programming/API language, and the presentation standard CSS3 (Cascading Style Sheets), but as they generally get used together, we will stick with simply referring to HTML5 here. 

Overall, HTML5 represents a general philosophy as much as anything else – the idea that the Internet is the future platform for all services and applications, finally breaking the link with underlying hardware, device type or operating system. 

Yet while this goal of a totally democratic and ubiquitous “execution layer” for software is a recurring one, the reality is that platform providers are always incentivised to differentiate, and create dedicated features that make their device or ecosystem optimised in some way. In Telco 2.0’s view, HTML5 will ultimately raise the “lowest common denominator” bar very high – but there will always be a need for proprietary “best of breed” software running on dedicated platforms.

Web pages, widgets and web-apps

It is worth quickly distinguishing between HTML5 mobile web pages, a “web app” and a widget a little more deeply. Firstly, an increasing proportion of “normal” web pages will be written in HTML5 and will be able to support a measure of interactivity. This is however outside the scope of this report, which focuses more on what happens on the device – specifically when the user downloads an “app” of some description. What this means is that HTML5 apps won’t feel to the user like a web page – there won’t be the usual browser UI elements like tabs, URL and search bars, bookmarks, back/forward buttons and so on. 

This is important for various reasons – including the psychology behind the browser vs. app difference. Many users instinctively believe that the browser-driven web is always “free” (and certainly, the constant presence of a search box and bookmarks makes it easy to escape to somewhere that is free). Conversely, standalone widgets feel like “pieces of software” and therefore fit better with the perception of payment.

There is also a bit of a complication in definition here – some of today’s “web apps” are actually just extensions of a web server’s code which runs in the browser (the HTML5 website, as described above). Conversely, true widgets are completely standalone, and can work fully offline without a connection to a server. In addition, while various device and browser platforms have offered widgets or “gadgets” before (e.g. Android phones and some Nokia’s devices have active web-connected elements on the home-screen), these have typically been based on proprietary platforms with significant differences in behaviour and coding. The fragmentation has hindered broader use – something that HTML5 (and perhaps related standardised widget environments like WAC) should solve.

HTML5 history and status

It is important to note that HTML5 is not yet “finished”, but remains a work-in-progress. Over time, it has evolved from an independent project started outside of W3C, to becoming a broader standard pursued by W3C, absorbing other features and functions over time. It is expected to be finally completed in 2014. 

Its origins started in an informal group called the Web Hypertext Application Technology Working Group (WHATWG) in 2004, set up when the “official” web industry body W3C tried to replace HTML with XML, voting down an alternative approach to applications. But proponents Mozilla, Apple and Opera decided to carry on developing it privately anyway, and in 2007 it was brought back into the fold officially. 

A full discussion of W3C’s processes and rather arcane distinctions between “drafts”, “recommendations” and so forth is outside the scope of this note, but the bottom line is that HTML5:

• Has enough stable elements to be implemented usefully today.
• Will continue to evolve for several more years.
• Is however likely to suffer from a measure of fragmentation and non-interoperability for some time to come.

Although it might be thought that this level of “flux” might be off-putting to telcos, it is worth noting that it is not that different to 3GPP or other bodies’ standards development. Many telecom standards are implemented in piecemeal fashion, and interoperability is often less than might be hoped. It’s not optimal – but neither is it a showstopper for telcos to become involved with HTML5.

Figure 1 – HTML5 standards scope & status

 

Figure 1 – HTML5 standards scope & status

To read the note in full, including the following additional analysis…

• The web vs. the app: a shifting battlefield
• The run-anywhere utopia
• Hybrid web+native apps
• HTML5 appstores
• HTML5, consumer electronics & PCs
• HTML5 & mobile phones
• Not all HTML5 devices are created equal
• The Internet (not-telco) actors in HTML5
• W3C
• Mozilla
• Google
• Telco initiatives around HTML5
• WAC (Wholesale Application Community)
• Former OMTP BONDI
• Boot to Gecko
• Risks and threats
• HTTPS and SPDY: secure but opaque
• Why WebRTC is transformative
• A new generation of competitors in apps?
• Innovative threat example – HTML5 tethering
• Impact of HTML5 on mobile networks
• Conclusion & recommendations
• Recommendations
• The Telco 2.0™ Initiative

…and the following figures…

• Figure 1 – HTML5 standards scope & status
• Figure 2 – HTML5 vs. native apps vs. hybrids
• Figure 3 – HTML5 pro’s and con’s
• Figure 4 – HTML5 remains fragmented in implementation
• Figure 5 – Browsers remain imperfect for HTLM5 but are improving fast
• Figure 6 – Google Chrome is a major catalyst for HTML5
• Figure 7 – Operator involvement in HTML5 is centred on WAC

Source: http://www.telco2research.com/articles/EB_HTML5-what-does-it-mean-for-telcos_Summary

Voice solutions in LTE

The original idea behind LTE is that it would provide only wireless internet services. However, major revenue for cellular operators comes from voice calls and SMS and therefore Voice in LTE has become a hot topic. Recently, I got an opportunity  to work with various voice solutions-the experience which I believe would be useful to share here.LTE does not have a ‘circuit switch core’ which means that we cannot have voice calls as it is in 2G and 3G technologies. In the initial LTE deployment cases however, operators are using their legacy networks along with their 4G network for voice services.

So far we have heard of the following available voice solutions which I will discuss briefly.

• Circuit Switched Fall Back (CSFB)
• Simultaneous Voice and LTE (SV-LTE)
• Voice over LTE (VoLTE)
• Voice over LTE via Generic Access (VoLGA)
• Over the top (OTT)

Circuit Switched Fall Back 

An operator who deployed LTE network, already owning a 3G or 2G network can take benefit from the feature called “Circuit switched fall back’. The main idea is that 4G smartphones are going to have a radio capabilities for 3G/2G networks as well. Such handsets can connect at a time either to LTE or 2G/3G . The shortcoming is that someone on voice call will not be able to use LTE network for browsing or chatting etc.

CSFB for operator means very little investment since only few modifications are required in the network. Additional interface between MME and MSC is required (SGs). CSFB solution has also been standardized by 3GPP and has gained large industrial support.

 

Simultaneous Voice and LTE

SV-LTE is handset specific in which handset is capabile of using two radios (LTE and WCDMA/GSM/CDMA) at one time. So a user can use packet services from LTE while voice call can be made on other networks simultaneously unlike CSFB. The shortfall here is high battery utilization due to dual radio operation. 

For CDMA and  LTE pair, the SV-LTE is the standard solution and being widely adopted. There are already SV-LTE smartphones available in the market. I came across a few available for LGU+ in Korea and Verizon in USA. Both operate LTE networks as an overlay to their old CDMA networks. 

SV-LTE is the cheapest option for operators as no new modification is required to the network. Nevertheless, as mentioned earlier it is at the cost of high battery utilization

 

Voice over LTE (IMS)

I believe this is going to be the most popular and widely adopted future voice solution for LTE. Instead of using legacy networks, VoLTE utilizes IP Multimedia Subsystem (IMS) and provides voice services  using the application layer on LTE.
IMS is a group of core network entities responsible for providing rich multimedia services over IP network. VoIP call, SMS, MMS, LIVE TV are a few such services. IMS has been in the communication industry for long but with the emergence of 4G networks, it is gaining popularity again.

 

Voice over LTE via Generic Access

I think, operators will accept VoLGA as a last option for voice capability. This solution uses CS core only from legacy networks and also require new network elements. Therefore LTE handsets do not need 3G/2G radio capabilities since radio part won’t be used from legacy networks. Good thing about this solution however is that unlike CSFB, LTE handset will be able to use voice and data simultaneously.

Over the top VoIP application

OTT is actually not LTE specific but a generic solution that we already have been using on 3G/WiFi networks. OTT application is completely transparent to network and also out of operators’ control. I am talking about generic VoIP clients like Viber, skype, Tango etc. They do not give the real taste of voice flexibility as in other 3GPP networks and also lack the QoS for voice. Nonetheless,  these will be widely used by the consumers as an alternative, because of the fact that it gives them full flexibility to choose their own service.

 

 

 

Source: http://4g-lte-world.blogspot.com/2012/05/voice-solutions-in-lte.html

GSA confirms 72 commercial LTE networks launched, LTE will enter mainstream in 2012

May 8, 2012: The GSA (Global mobile Suppliers Association) has published an update to its Evolution to LTE report which confirms 319 operators have committed to commercial LTE network deployments or are engaged in trials, technology testing or studies. The report covers LTE FDD and LTE TDD system modes.

258 firm commercial LTE network deployments are either in deployment, commercially launched, or are planned in 84 countries. Another 61 operators in 13 additional countries are engaged in LTE technology trials, tests or studies. [continues after image]

 

Source: http://www.gsacom.com/news/gsa_351.php?goback=%2Egde_136744_member_113811519

72 LTE operators have launched commercial services, including 25 networks launched so far in 2012. Commercial LTE services are available today in 37 countries, in developing and developed markets in all regions: Angola, Armenia, Australia, Austria, Bahrain, Belarus, Brazil, Canada, Croatia, Denmark, Estonia, Finland, Germany, Hong Kong, Hungary, India, Japan, Kuwait, Kyrgyzstan, Latvia, Lithuania, Moldova, Netherlands, Norway, Philippines, Poland, Portugal, Puerto Rico, Russia, Saudi Arabia, Singapore, South Korea, Sweden, UAE, Uruguay, USA, and Uzbekistan.

Alan Hadden, President of the GSA, said: “52 operators launched commercial LTE service in the past 12 months and dozens more operators are preparing to commercially launch LTE networks this year. With hundreds of LTE user devices available now, addressing all market segments with fast subscriptions growth, LTE will enter a new phase as a mainstream technology in 2012.”

LTE commercial network launches per year:

• 2009 = 2 networks launched
• 2010 = 15 networks launched (year-end cumulative total = 17)
• 2011 = 30 networks launched (year-end cumulative total = 47)
• 2012 to May 8th = 25 networks launched (total to date = 72)
• GSA end 2012 forecast = 134 networks in 57 countries

The Evolution to LTE report is researched and published by GSA and provides a concise update of the business drivers, objectives and targets for LTE – Long Term Evolution and the evolved packet system, including network operator commitments, deployments, launches, trials, the growing eco-system including device availability, spectrum requirements and developments, Voice over LTE developments, standardization activities including LTE-Advanced, and more.

The Evolution to LTE report is available as a free download to registered site users at www.gsacom.com/gsm_3g/info_papers

Registration page to download this and other reports, papers, charts, etc. www.gsacom.com/php/register_form.php4

Numerous charts and maps depicting the mobile broadband market, growth and trends including LTE are available at www.gsacom.com/news/statistics.php4

T-Mobile picks Ericsson, NSN as its LTE vendors

May 7, 2012 — 10:00pm ET | By Phil Goldstein

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NEW ORLEANS–T-Mobile USA selected Ericsson (NASDAQ:ERIC) and Nokia Siemens Networks as its primary infrastructure vendors for its forthcoming LTE network. T-Mobile is the last of the nation’s Tier 1 carriers to pick vendors for an LTE rollout. 

Ericsson and Nokia Siemens will install LTE Release 10-capable equipment at 37,000 cell sites across T-Mobile’s HSPA+ network footprint as part of the carrier’s effort to increase signal quality and improve network performance this year. T-Mobile will formally launch LTE next year as part of a $1.4 billion investment T-Mobile parent Deutsche Telekom is making this year and next year; the investments will total $4 billion over time. 

T-Mobile said it expects to be the first carrier in North America to deploy antenna integrated radios, which it said will speed up its rollout and reduce the load it puts on cell sites. Integrated radios are a growing trend among infrastructure vendors. By integrating the radio and the antenna, carriers can reduce power consumption and space on cell towers. 

For Ericsson, the T-Mobile deal completes a sweep of major LTE contracts with all four of the country’s Tier 1 carriers. Both AT&T Mobility (NYSE:T) and Verizon Wireless (NYSE:VZ) chose Ericsson and Alcatel-Lucent as their primary LTE vendors. Sprint Nextel, meanwhile, chose Ericsson, Alcatel-lucent and Samsung as the three main vendors for its Network Vision network modernization plan, which includes an upgrade to LTE. 

The win for Nokia Siemens is especially important given its lagging position in the North American market relative to Ericsson and Alcatel-Lucent. NSN, which like Ericsson is a key supplier for T-Mobile’s HSPA+ network, has won LTE contracts around the world, but had been shut out of major contracts by U.S. carriers.

“For Ericsson, they’re now everywhere. Ericsson and NSN were the 3G suppliers, so it’s not particularly surprising,” Current Analysis analyst Peter Jarich told FierceWireless. “If NSN hadn’t won then they were completely going to have rethink their strategy on North America. And it would have been a complete blow to their reputation.”

Tolaga Research analyst Phil Marshall said the deal “fortifies Ericsson’s position in the U.S. and for NSN it now cracked the U.S. LTE market–one of its strategic objectives.”

T-Mobile plans to launch LTE service on its AWS spectrum, including some spectrum it received from AT&T as a condition of the $6 billion breakup fee AT&T paid Deutsche Telkom when AT&T’s $39 billion bid for T-Mobile collapsed last year. As part of the breakup fee, T-Mobile scored AWS spectrum from AT&T in 128 market areas, including in 12 of the top 20 markets in the United States: Atlanta, Boston, Baltimore, Dallas, Denver, Houston, Los Angeles, Phoenix, San Diego, San Francisco, Seattle and Washington, D.C.

T-Mobile plans to use the new AWS spectrum for its LTE deployment in 2013. Currently, T-Mobile offers an HSPA+42 network covering 184 million POPs in 185 markets, and its HSPA+21 network covers around 220 million POPs. The breakup fee includes $3 billion in cash, as well as a seven-year UMTS roaming agreements that will allow T-Mobile to expand its coverage to 280 million POPs from 230 million today. T-Mobile has said it will have enough AWS spectrum in 75 percent of the top 25 markets to roll out LTE with 10 MHz of spectrum.

As part of its network upgrade, by the end of 2012 T-Mobile will deploy HSPA+ services in its PCS 1900 MHz spectrum band, which it is currently using for 2G GSM services (the carrier’s HSPA+ network currently runs on T-Mobile’s 1700 MHz AWS spectrum). The company said it will continue to support 2G customers as it refarms the spectrum. T-Mobile said network modernization trials have shown a 33 percent improvement in HSPA+ data speeds and in-building signal penetration.

Jarich said he did not know how quickly T-Mobile’s LTE deployment would proceed, but said it will be entirely dependent upon how quickly T-Mobile can refarm its spectrum. “It’s going to be a function of how they move people off their spectrum,” he said. “When they’re ready to move forward the network sites should be ready to move forward pretty quickly.” Jarich also noted that NSN announced a new solution to help carriers with GSM spectrum refarming.

“With these partners on board and the AT&T AWS spectrum secured, we’re on track to enhance our 4G experience this year and deliver nationwide LTE in 2013,” T-Mobile CTO Nevile Ray said in a statement. Ray will be speaking at the annual FierceWireless “Path to 4G” conference at the CTIA Wireless 2012 conference here on May 8.

For more:
– see this release

Source: http://www.fiercewireless.com/ctialive/story/t-mobile-picks-ericsson-nsn-its-lte-vendors/2012-05-07?utm_medium=rss&utm_source=rss

How VoIP can reduce infrastructure costs

Voice over Internet Protocol, or VoIP, is becoming increasingly popular with businesses in today’s economic climate. Significant cost savings can be realized by using a VoIP platform to connect employees virtually, freeing up costly office space in the process.

“VoIP is the utilization of Internet connectivity to make phone calls. It can transform the way you do business,” says Michael Gray, a senior sales executive with Ohio.net.

Smart Business spoke with Gray and his client Ken Fanger, president of Solar Systems Networking, about VoIP, the advantages such a platform provides, and what advances are envisioned in the future.

How does VoIP translate to tangible benefits for an organization?

Gray: It depends on what a client’s needs are. Typically, however, businesses see benefits ranging from being able to connect multiple people back to the core office to being able to build customized call routing protocols to eliminate any geographic restrictions they may face. For example, remote salespeople who telecommute are provided with the ability to connect to their home office, which saves in commuting costs for the employee and overhead costs for the employer. VoIP can benefit a business in many ways.

Fanger: The biggest advantage for us is we are able to use the VoIP solution combined with forwarding to our cell phones so we don’t have to have our people tied to a phone system. We are a consulting technology firm so we aren’t usually sitting in the office. VoIP has helped us take advantage of having people connected and working while presenting one type of sales face to the world. It makes it much easier for us to manage all of the virtual clientele that we work with without having to have a physical location.

What advantages does VoIP provide in terms of releasing businesses from office space?

Gray: VoIP frees business from having to be tethered to a physical location. For example, our organization has salespeople who telecommute and can work from anywhere. When they receive a phone call it appears as though they are in the office although they might be a million miles away. I have a client who was able to realize savings of $250,000 per year on office space and associated overhead costs because they made the switch to a VoIP platform.

Fanger: VoIP provides a virtual platform so you can have employees and phone numbers anywhere in the United States. We have an employee who works in Texas and has a local Texas number, but it still connects to our VoIP solution. So when customers call in they have a local contact, but access to our company. It provides us a great opportunity to reach out to new markets that we couldn’t have reached any other way. We are a six-person company so being able use a cost-effective VoIP platform is vital to our ability to grow.

How can a brick-and-mortar feel still be replicated?

Gray: Customers can still receive the live contact they crave. With VoIP, you have the ability to transfer phones so people can get a live answer. The environment feels the same, but is conducted through a virtual atmosphere.

Fanger: When a person calls in they can’t tell the difference between the virtual environment and a brick-and-mortar structure. It’s nice because we don’t have infrastructure costs, but when people are calling our company we have a full-functioning phone system that allows us to do business in a manner advantageous to us.

How has VoIP changed over the past several years?

Gray: VoIP has become more dynamic in supporting other applications such as smartphones and tablets. It gives companies the ability to essentially hand off a smartphone to an employee which equates to an extension within their world. The need for an actual desk phone is going away. We are moving away from a phone-line environment to a cloud-based, virtual phone model.

Fanger: We’ve been using VoIP for six years. The feature sets have been growing and there is more functionality, which allows us to stay in touch within our organization. Also, it now works really well for adding to smart devices units.

How do you envision it evolving in the future?

Gray: I see VoIP becoming more of a cloud-based application, which would lead to it being able to work better with devices such as smartphones and iPads. It will be more software based in the sense that traditional handsets will no longer be applicable in our world. VoIP will be much more dynamic and will continue to provide businesses with a brick-and-mortar feel, but without the physical brick-and-mortar overhead.

Fanger: VoIP will definitely move toward combining phones with different types of applications, such as customer relationship management. As people embrace devices such as the iPhone and iPad, there will be greater integration between work applications.

Michael Gray is a senior sales executive with Ohio.net. Reach him at mgray@ohio.net or (330) 658-1777.

Ken Fanger is president of Solar Systems Networking. Reach him at kfanger@solsysnetwork.com or (440) 243-3207.

Source: http://www.sbnonline.com/2012/04/how-voip-can-reduce-infrastructure-costs/?full=1&goback=%2Egde_136744_member_113597984

Edge, HSPA and LTE innovations

108 pagina’s – http://www.4gamericas.org/documents/EDGE_HSPA_and_LTE_Broadband_Innovation_Rysavy_Sept_2008.pdf

Index ->

TABLE OF CONTENTS

 

INTRODUCTION ………………………………………………………………………………………… 3

BROADBAND DEVELOPMENTS …………………………………………………………………….. 5

WIRELESS DATA MARKET …………………………………………………………………………… 8

Trends …………………………………………………………………………………………………. 9

EDGE/HSPA/HSPA+ Deployment ………………………………………………………………… 13

Statistics …………………………………………………………………………………………….. 13

WIRELESS TECHNOLOGY EVOLUTION AND MIGRATION ………………………………… 15

Technical Approaches (TDMA, CDMA, OFDMA) ……………………………………………….. 15

3GPP Evolutionary Approach …………………………………………………………………….. 17

Spectrum ……………………………………………………………………………………………. 20

Core-Network Evolution …………………………………………………………………………… 22

Service Evolution …………………………………………………………………………………… 23

Broadband-Wireless Deployment Considerations …………………………………………….. 24

Feature and Network Roadmap ………………………………………………………………….. 25

COMPETING TECHNOLOGIES …………………………………………………………………….. 29

CDMA2000 ………………………………………………………………………………………….. 29

WiMAX ……………………………………………………………………………………………….. 32

IEEE 802.20 …………………………………………………………………………………………. 35

Wi-Fi and Municipal Wi-Fi Systems ……………………………………………………………… 35

COMPARISON OF WIRELESS TECHNOLOGIES ………………………………………………. 36

Data Throughput …………………………………………………………………………………… 36

HSDPA Throughput in Representative Scenarios ……………………………………………… 40

Release 99 and HSUPA Uplink Performance …………………………………………………… 41

LTE Throughput …………………………………………………………………………………….. 42

Latency ………………………………………………………………………………………………. 43

Spectral Efficiency …………………………………………………………………………………. 44

Cost, Volume and Market Comparison …………………………………………………………. 52

Competitive Summary …………………………………………………………………………….. 54

CONCLUSION ………………………………………………………………………………………….. 56

APPENDIX: TECHNOLOGY DETAILS ……………………………………………………………. 58

EDGE …………………………………………………………………………………………………. 58

Evolved EDGE ………………………………………………………………………………………. 62

UMTS/HSPA Technology ………………………………………………………………………….. 70

UMTS Release 99 Data Capabilities ……………………………………………………………… 72

HSDPA ……………………………………………………………………………………………….. 73

HSUPA ……………………………………………………………………………………………….. 76

Evolution of HSPA (HSPA+) ………………………………………………………………………. 78

HSPA Voice Support ……………………………………………………………………………….. 84

3GPP LTE ……………………………………………………………………………………………. 86

4G, IMT-Advanced and LTE Advanced ………………………………………………………….. 89

UMTS TDD …………………………………………………………………………………………… 90

TD-SCDMA ………………………………………………………………………………………….. 91

IMS …………………………………………………………………………………………………… 91

Broadcast/Multicast Services …………………………………………………………………….. 93

EPC/SAE……………………………………………………………………………………………… 94

ACRONYMS …………………………………………………………………………………………….. 96

ADDITIONAL INFORMATION …………………………………………………………………… 100

REFERENCES ………………………………………………………………………………………… 100

EDGE, HSPA, LTE: Broadband Innovation Page 3

Introduction

Through constant innovation, Universal Mobile Telecommunications System (UMTS) with

High Speed Packet Access (HSPA) technology and its evolution to beyond third generation

(3G) has established itself as

the

global, mobile-broadband solution. Building on the

phenomenal success of Global System for Mobile Communications (GSM), the GSM/UMTS

 

ecosystem is becoming the most successful communications technology family ever.

 

Through a process of constant improvement, the GSM family of technologies has not only

 

matched or exceeded the capabilities of all competing approaches, but has significantly

 

extended the life of each of its member technologies.

 

UMTS/HSPA, in particular, has many key technical and business advantages over other

 

mobile wireless technologies. Operators worldwide are now deploying both High Speed

 

Downlink Packet Access (HSDPA) and High Speed Uplink Packet Access (HSUPA), the

 

combination of the two technologies called simply HSPA. HSPA is one of the most powerful

 

cellular-data technologies ever developed. HSPA, already widely available, follows the

 

successful deployment of UMTS networks around the world and is now a standard feature.

 

Any operator deploying UMTS today is doing so with HSPA. The UMTS-to-HSPA upgrade is

 

similar to Enhanced Data Rates for GSM Evolution (EDGE), which has already proven to be a

 

remarkably effective upgrade to GSM networks, and HSPA (or HSDPA for some networks) is

 

now supported by an overwhelming number of operators and vendors worldwide.

 

HSPA is strongly positioned to be the dominant mobile-data technology for the rest of the

 

decade. To leverage operator investments in HSPA, the 3GPP (Third Generation Partnership

 

Project) standards body has developed a series of enhancements to create “HSPA

 

Evolution,” also referred to as “HSPA+.” HSPA Evolution represents a logical development of

 

the Wideband Code Division Multiple Access (WCDMA) approach, and it is the stepping stone

 

to an entirely new Third Generation Partnership Project (3GPP) radio platform called 3GPP

 

Long Term Evolution (LTE). LTE, which uses Orthogonal Frequency Division Multiple Access

 

(OFDMA), should be ready for deployment in the 2010 timeframe. Simultaneously, 3GPP —

 

recognizing the significant worldwide investments in GSM networks—has defined

 

enhancements that will significantly increase EDGE data capabilities through an effort called

 

Evolved EDGE.

 

Combined with these improvements in radio-access technology, 3GPP has also spearheaded

 

the development of major core-network architecture enhancements such as the IP

 

Multimedia Subsystem (IMS) and the Evolved Packet Core (or EPC, previously called System

 

Architecture Evolution or SAE), as well as developments in Fixed Mobile Convergence (FMC).

 

These developments will facilitate new types of services, the integration of legacy and new

 

networks, the convergence between fixed and wireless systems, and the transition from

 

circuit-switched approaches for voice traffic to a fully packet-switched model.

 

The result is a balanced portfolio of complementary technologies that covers both radioaccess

 

and core networks, provides operators maximum flexibility in how they enhance their

 

networks over time, and supports both voice and data services.

 

This paper discusses the evolution of EDGE, HSPA enhancements, 3GPP LTE, the capabilities

 

of these technologies, and their position relative to other primary competing technologies.

 

The following are some of the important observations and conclusions of this paper:

 

 



 

Persistent innovation created EDGE, which was a significant advance over GPRS;

HSPA and HSPA+, which are bringing UMTS to its full potential; and is now delivering

 

LTE, the most powerful, wide-area wireless technology ever developed.

 

EDGE, HSPA, LTE: Broadband Innovation Page 4

 

 



 

GSM/UMTS has an overwhelming global position in terms of subscribers,

deployment, and services. Its success will marginalize other wide-area wireless

 

technologies.

 

 



 

In current deployments, HSPA users regularly experience throughput rates well in

excess of 1 megabit per second (Mbps), under favorable conditions, on both

 

downlinks and uplinks. Planned enhancements will increase these peak userachievable

 

throughput rates, with 4 Mbps on commercial networks being commonly

 

measured.

 

 



 

HSPA Evolution provides a strategic performance roadmap advantage for incumbent

GSM/UMTS operators. HSPA+ with 2×2 MIMO, successive interference cancellation,

 

and 64 Quadrature Amplitude Modulation (QAM) is more spectrally efficient than

 

competing technologies including Worldwide Interoperability for Microwave Access

 

(WiMAX) Wave 2 with 2×2 MIMO and Evolved Data Optimized (EV-DO) Revision B.

 

 



 

The LTE Radio Access Network technical specification was approved in January 2008

and is being incorporated into 3GPP Release 8, which is close to completion. Initial

 

deployments are likely to occur around 2010. The 3GPP OFDMA approach used in

 

LTE matches or exceeds the capabilities of any other OFDMA system. Peak

 

theoretical rates are 326 Mbps in a 20 MHz channel bandwidth. LTE assumes a full

 

Internet Protocol (IP) network architecture, and it is designed to support voice in the

 

packet domain.

 

 



 

LTE has become the technology platform of choice as GSM/UMTS and CDMA/EV-DO

operators are making strategic long-term decisions on their next-generation

 

platforms. In June of 2008, after extensive evaluation, LTE was the first and only

 

technology recognized by the Next Generation Mobile Network alliance to meet its

 

broad requirements.

 

 



 

GSM/HSPA will comprise the overwhelming majority of subscribers over the next five

to ten years, even as new wireless technologies are adopted. The deployment of LTE

 

and its coexistence with UMTS/HSPA will be analogous to the deployment of

 

UMTS/HSPA and its coexistence with GSM.

 

 



 

3GPP is now studying how to enhance LTE to meet the requirements of IMTAdvanced

in a project called LTE Advanced.

 

 



 

UMTS/HSPA/LTE have significant economic advantages over other wireless

technologies.

 

 



 

WiMAX has developed an ecosystem supported by many companies, but it will still

only represent a very small percentage of wireless subscribers over the next five to

 

ten years.

 

 



 

EDGE technology has proven extremely successful and is widely deployed on GSM

networks globally. Advanced capabilities with Evolved EDGE can double and

 

eventually quadruple current EDGE throughput rates.

 

 



 

With a UMTS multiradio network, a common core network can efficiently support

GSM, WCDMA, and HSPA access networks and offer high efficiency for both high and

 

low data rates, as well as for both high- and low-traffic density configurations. In the

 

future, EPC/SAE will provide a new core network that supports both LTE and

 

interoperability with legacy GSM/UMTS radio-access networks.

 

 



 

Innovations such as EPC/SAE and UMTS one-tunnel architecture will “flatten” the

network, simplifying deployment and reducing latency.

 

EDGE, HSPA, LTE: Broadband Innovation Page 5

 

 



 

Circuit-switched, voice over HSPA, then moving to Voice over Internet Protocol

(VoIP) over HSPA will add to voice capacity and reduce infrastructure costs. In the

 

meantime, UMTS/HSPA enjoys high circuit-switched voice spectral efficiency, and it

 

can combine voice and data on the same radio channel.

 

This paper begins with an overview of the market, looking at trends,