bharti airtel - · pdf fileissue 14 11/2012 starhub: a cloud is born talktalk protects...

Issue 1411/2012

StarHub: A cloud is born

TalkTalk protects families online

Bharti Airtellooks to make India truly broadband

China Mobile energizes the LTE TDD market

STC brings three mobile generations under one roof

OTT players have been encroaching on operators’ core services ever since Skype first went online, and their effect is ever growing, with users of WeChat (China’s answer to WhatsApp) passing 200 million this past September. A mobileSQUARED (a U.K. market research firm) 2011 survey of 31 global mobile operators indicated that three-quarters of them were worried about losing revenue to these players, while one-third were already seeing declines in terms of both revenue and traffic. And what’s more, Google is no longer content to be just an OTT player, as the Internet giant recently started into the pipe business by launching a fiber network in Kansas City, which is claimed to offer broadband speeds “100 times faster than today’s broadband.”

Needless to say, the lines are blurring as newcomers foray into telcos’ core business domains, and their bottom lines will be even more affected as mobile Internet flourishes, networks transform to All-IP, smart terminals diversify, and personal computing gives way to the cloud, all of which represent a new phase of IT integration and development. Informatization is the name of the game, bringing telcos challenges and opportunities like never before.

In the big data era, telcos should consolidate their network infrastructure and emphasize their pipes to the fullest, as neither industrial nor social development will advance without them. This means better planning and utilization of network resources, including copper, fiber, sites, and spectrum, and data centers, supplemented with the latest technologies. It also means the use of software-defined mechanisms that enhance intelligence at each network layer and shorten TTM so that operators can stay ahead of service providers of Internet and enterprise applications.

Telcos should also fully utilize their scale and brand advantages in the ICT arena, so that they can actively promote and establish cooperative partnerships in the ICT industry, but this will require an open platform that fosters harmony in the ICT ecosystem.

However, these steps alone will not determine who wins in the new value chain. Ultimately, it comes down to a superb user experience and who provides it. Telcos should be the ones filling this role, but this will require not just courage and determination but, more importantly, wisdom and vision.

ICT integration deepens

Sponsor Huawei Technologies Co., Ltd.

Publisher Huawei COMMUNICATE Editorial Board

Consultants Hu Houkun, Xu Zhijun, Ding Yun

Yu Chengdong, Chen Wei

Editor-in-Chief Gao Xianrui ([email protected])

Editors Pearl Zhu, Xue Hua, Julia Yao, Jason Patterson

Michael Huang, Joyce Fan, Linda Xu, Xu Ping

Cao Zhihui, Li Xuefeng, Pan Tao

Chen Yuhong, Zhou Shumin

ContributorsDeng Taihua, Qiu Heng, Yao Jiajian, Yu Xiangyang

Zheng Yuanyuan, Liu Zhen, Yu Dan, Xu Caiming

Izawa Michiko, Li Pengcheng, Cao Haichen

Shi Tianlong, Lu Haomin

E-mail: [email protected]: +86 755 28786665, 28787643

Fax: +86 755 28788811

Address: B1, Huawei Industrial Base,

Bantian, Longgang, Shenzhen 518129, China

Publication Registration No.: Yue B No.10148

Copyright © Huawei Technologies Co., Ltd. 2012. All rights reserved.No part of this document may be reproduced or transmitted in any form or by any means without prior written consent of Huawei Technologies Co., Ltd.

DisclaimerThe contents of this document are for information purpose only, and provided “as is”. Except as required by applicable laws, no warranties of any kind, either express or implied, including but not limited to, the implied warranties of merchantability and fitness for a particular purpose, are made in relation to contents of this document. To the maximum extent permitted by applicable law, in no case shall Huawei Technologies Co., Ltd be liable for any special, incidental, indirect, or consequential damages, or lost profits, business, revenue, data, goodwill or anticipated savings arising out of or in connection with any use of this document.

Bill Zhang

President of Marketing & Solution Carrier Network Business Group

For electronic version and subscription, please visit www.huawei.com/winwin

Hear what operators want to share in person,see how peers succeed in a fierce marketplace, and delve into their secrets to success. At WinWin, it’s all about success.

WHAT’S INSIDE Bharti Airtel looks to make India

“truly broadband”01

Bharti Airtel launched its LTE TDD services in April 2012, making it the first and only operator in India to utilize this technology. Considering the relatively undeveloped state of the local market, this move might seem premature, but not to Jagbir Singh, CTO & Director, Network Services Group, Airtel India & South Asia.

Voices from Operators

11/2012

StarHub: A cloud is born06

Telcos play a large part in how new technologies play out, which makes their conspicuous absence from the ranks of cloud success stories all the more puzzling. Sunny Tan, Assistant Vice President of Enterprise Business Group – Solutions, StarHub, sits down with WinWin to discuss how the Singapore operator will remedy this.

NTT DOCOMO keeps Japan smart09

NTT DOCOMO is in the midst of enhancing its smartphone strategy, primarily by focusing on Androidphones. Kiyohito Nagata, Senior Vice President and Member of the Board of Directors at NTT DOCOMO, discusses the company’s device strategy.

Issue 14

China Mobile energizes the LTE TDD market

39

China Mobile has been a champion of LTE TDD in recent years, through efforts such as the LTE TDD service debut at the World Expo in Shanghai, and its trial network in Hangzhou city.

China Telecom takes the drive out of testing in Hangzhou

47

Monetizing the NBN: Strategies & services27

Winners

TalkTalk provides online protection for families

35

STC brings three generationsunder one roof

51

Cyber security perspectives15

Tao of Business

Huawei knows LTE TDD inside & out23

LTE TDD goes mainstream17

On Huawei’s Pipe Strategy13

Eric Xu, Huawei EVP: The pipe strategy is Huawei’s core, and the pipe business will remain our focus. As the digital flood approaches, we commit ourselves to enhanced pipe capacity, strengthened pipe enablers, and optimized pipe management, to deliver ever wider and more ubiquitous pipes, and an even better user experience.

Perspectives

SoftBank’s LTE TDD networkimpresses in Japan

43

At ten months after its launch, the SoftBank group’s LTE TDD network attracted more than 260,000 customers, and this number will continue to grow as its coverage expands.

Frenemies: How can telcos get a piece of the OTT pie?

31

NOV 20121 21

VOICESFROM OPERATORS

Bharti Airtel looks to make India “truly broadband”

Bharti Airtel launched its LTE TDD services in April of this year over broadband wireless access (BWA) spectrum, making it the first and only operator in India to utilize this technology. Jagbir Singh (CTO & Director, Network Services Group, Airtel India & South Asia) recently sat down with WinWin to discuss the latest trends in the Indian telecom industry and how they have motivated the operator to press forward into LTE.

By Jason Patterson

A billion mobile users

WinWin: What is the wireless technology roadmap for the Indian telecom sector?

Singh: Presently, the Indian telecom sector is undergoing a major transformation. The last decade has seen an exponential growth of mobile users from a few million to near a billion today. This growth was driven by a latent demand for voice traffic. We are now moving from a voice-only network to a “voice also” network which will see huge consumption of data volumes, adoptions of new applications & content-rich services, and a bigger

penetration of smartphones. Translating this to wireless technology, this will mean a service-aware network that is elastic for varying customer needs, and is flatter with highly-scalable backhaul capabilities.

Given the spectrum pricing and the infrastructure required for backhaul, the roadmap for the Indian telecom sector is going to be a mix of technologies serving the varying needs of the customer. Scarcity of spectrum will cause a significant migration towards more localized networks such as femtocells, picos, and Wi-Fi. This will also require an infinitely expandable wired backhaul that feeds into the core network. The service providers will strive to serve the customer with the technology that is most spectrally efficient and that can adapt to the customer requirements. How to manage the seamless movement of customers across technologies is also another challenge that the industry will need to address.

WinWin: In what ways do you think regulators can drive mobile broadband forward in India?

Singh: The key requirements for mobile broadband are the availability of spectrum at affordable rates and the availability of backhaul infrastructure to carry large amounts of data traffic. Rational spectrum pricing & regulation simplicity for issues like ROW (Right of Way), as well as infrastructure sharing for both passive & active

NOV 20121 22

— Jagbir Singh, CTO & Director, Network Services Group, Airtel India & South Asia

As the first operator to launch LTE TDD service in India, Bharti Airtel is leading the way in bringing advanced technologies to developing countries in an affordable manner.

NOV 20123 4

contributing to LTE TDD ecosystem development?Singh: We are a founding member and active

participant in the GTI (Global TD-LTE Initiative) forum, through which we keep meeting and exchanging knowledge with our peers from across the globe. Also, as the first operator to launch the service in India, we are leading the way in bringing advanced technologies to developing countries in an affordable manner. We are also engaging with device and chip manufacturers to influence the availability of affordable devices for our customers.

WinWin: How do you foresee LTE TDD developing on a global scale vis-à-vis LTE FDD?

Singh: Globally, the choice of technology by operators is mainly governed by the relevance of technology with respect to spectrum availability. Since both FDD and TDD are at a very nascent stage of tech maturity, I believe that the respective geographies will drive the evolution of both FDD and TDD in parallel on a medium-term horizon.

As of now, both the technologies seem to have gathered equal momentum and operators worldwide are selecting either of them based on the spectrum they manage to acquire and the overall ecosystem development in their country/region.

WinWin: Given that 3G is still in its infancy in India, do you think the Indian market is ready for 4G?

Singh: The GSMA predicts that by 2016 India will be the second largest wireless broadband market. This is not unnatural, as fixed broadband penetration is not good enough in India due to several factors like poor copper coverage, high cost of laying the infrastructure, etc. This pent up demand for data, especially in the youth and

The Indian user is just getting to know the power of mobile broadband with the advent of 3G services. Given the limited

spectrum available for 3G services in India, LTE TDD technology, which can utilize alternate spectrum, is an obvious way forward.

3

elements, would be the key drivers for broadband growth.Laying and maintaining multi-terabyte fiber backhaul

networks is a huge investment and is also inevitable. The stakeholders have yet to reach an agreement that can contain the costs in this area. Possibilities could include formation of consortiums similar to those existing in the international arena or formation of a government-funded subsidy similar to the Universal System Obligation Fund (an Indian mandate that levies telco revenues) for taking connectivity to upcountry locations. As far as ROW is concerned, there are no pan-India guidelines and every municipality and state government makes decisions for its own reasons. However, this impacts the national agenda of “connecting the unconnected,” so there is a need to consolidate the laws around ROW.

WinWin: How would you envisage the mobile broadband landscape over the next 2-3 years in India?

Singh: As per recently published results, mobile data traffic in India is up by 54 percent in the first half of 2012. With more than 100 million Internet users as of today, the growth of data consumption is going to be exponential both in terms of number of users and usage per customer.

Also, the National Telecom Policy 2012 envisages “broadband for all” at a minimum download speed of 2Mbps. With the way smartphone adoption, data usage, and app adoption trends are moving, it seems that very soon even 2Mbps is not going to be enough, especially for early adopters of technology in major cities.

Ready or not for LTE?

WinWin: As the market leader in India and the world’s fifth-largest carrier, how is Bharti Airtel


NOV 20123 4

corporate segments, will be a big driver towards growth of data for a mobile broadband bearer. With a limited 3G spectrum, it is only natural that a more scalable option is explored that can seamlessly handle this growth.

From a technology perspective, India has adopted 3G a little later than the rest of the world, which has the advantage of creating a network with tried & tested technology. Also, 4G, as a technology, is rapidly being adopted in other markets and has obvious advantages of efficiency and scale. Also, like I mentioned earlier, all the technologies will have to coexist to enhance spectral efficiency.

An uphill climb

WinWin: How will Bharti balance/prioritize 3G and BWA (LTE TDD) network investment in the short-to-medium-term?

Singh: In the recent past, India has been moving very fast on the digitization curve; this fact highlights the growth potential for data services, especially mobile broadband services. The Indian user is just getting to know the power of mobile broadband with the advent of 3G services. Given the limited spectrum available for 3G services in India, LTE TDD technology, which can utilize alternate spectrum, is an obvious way forward.

LTE TDD, as a technology, is not as mature as 3G and to tap the full potential of this technology, it makes sense to start deploying it in a controlled manner, not only to validate the capabilities, but also to influence the evolution path which is suited to growing markets like India. With increasing urbanization and mobility in metropolitan areas, very soon even the typical 3G speeds will not suffice.

Airtel is placed at a very advantageous position by virtue of having a significant footprint in the wireline domain which most

of the operators lack. LTE rollout would marry this footprint seamlessly into the greater wireless architecture.

4

We plan to create a layered architecture in the metros with coexistent 2G-3G-LTE-Wi-Fi mesh networks.

WinWin: What has been Bharti Airtel’s strategy on the LTE TDD network rollout front?

Singh: LTE is one of the cornerstones when it comes to true convergence of network architecture and topology, the best of both wireless and wireline architecture, and a flatter and more scalable transport network with ubiquitous radio coverage augmented by a focused microcell mesh that pushes the limits of the network closer to the user.

Airtel is placed at a very advantageous position by virtue of having a significant footprint in the wireline domain which most of the operators lack. LTE rollout would marry this footprint seamlessly into the greater wireless architecture, thereby creating a world class network capable of providing a “truly broadband” user experience.

WinWin: What key challenges have Bharti Airtel encountered in network rollout and how has it tackled them?

Singh: Readiness and maturity in a robust product line for LTE TDD is the foremost challenge at present. This fact, coupled with a lack of available devices and challenges around ROW for scalable backhaul architecture, are some issues that we continue to face as we expand our LTE rollout.

As is the case with any new technology, the learning curve is very steep and the pace of innovation has increased dramatically in the last decade. LTE is being launched globally in several spectra and FDD/TDD versions; add to this the complexity of coexistent 2G, 3G and Wi-Fi networks, and you have a continuously evolving technology landscape, which is a challenge in itself,

NOV 20125 6

in the voice business. While the revenues don’t increase proportionately, the spectrum requirement is proportional to the data growth and becomes very expensive.

Another critical aspect on which we are working with the regulators and government agencies is the ROW permissions for laying fiber in the cities. Without a robust and scalable backhaul infrastructure, it will not be possible to deliver the speeds that the customers expect when they adopt technologies like LTE.

WinWin: How does Bharti Airtel position its LTE service and what will be the key factors driving LTE uptake in the country?

Singh: The future of telecommunication is data and this is an investment in that direction. We are fully convinced that the growth in data is bound to happen and this platform is an enabler for data to take off in a big way.

As of now, we are delivering 4G services via CPE (customer premises equipment) and dongle. Apart from the availability of the service, the other important factors that will drive 4G uptake in the country are the content and device ecosystem.

WinWin: How would you evaluate Huawei’s skills as a vendor and as a partner for BWA (LTE TDD) network rollout?

Singh: Huawei has been our partner in launching 3G and then 4G in Bangalore and I would say that overall, the experience has been quite satisfactory. Airtel has also awarded Huawei projects for building a nationwide high-capacity expressway. In addition to this, Huawei has also supplied packet core for our network. I would rate my overall experience of working with Huawei as satisfactory.

Editor: Gao Xianrui [email protected]


especially when augmenting a new technology onto a live network, because you don’t want to disrupt the existing services.

We underwent detailed interoperability tests in order to ensure minimal glitches in the launch of 4G services and smooth integration with the existing network. From an infrastructure point of view, the rollout so far has been relatively less challenging as compared to the greenfield rollout of 2G since most of our initial 4G sites were co-located with existing sites. However, the launch of LTE needed a complete upgrade and modernization of the backhaul system, which meant laying new fiber in the cities and creating more sites to support microcell layer architecture.

WinWin: What lessons/experiences from 3G service development have Bharti Airtel found relevant for promoting LTE services?

Singh: Making a heterogeneous network scale, inter-operate, and deliver the requisite quality of service is a great experience we have picked up from our 3G launch. We have learned how to connect and manage network elements that cut across a wide range of technologies, manufacturers, and standards. Handling a disproportionate amount of data traffic growth is also a good problem to have when it comes to creating a mobile broadband network.

These lessons will go a long way in establishing a 4G network footprint that is service-aware, seamlessly managed across vendor ecosystems, and scalable to handle the data explosion which is about to hit India.

From a business perspective, after the launch of 3G services, the industry has been facing a “multi-terabit challenge” in which revenues are not growing proportionately with traffic, unlike what used to happen

The future of telecommunication is data and LTE TDD is an investment in that direction. We are fully convinced that the growth in data is bound to

happen and this platform is an enabler for data to take off in a big way.

NOV 20125 6

StarHub: A cloud is bornTelcos play a large part in how new technologies play out, which makes their conspicuous absence from the ranks of cloud success stories all the more puzzling. “How did we let a bookseller corner the market?” asks Sunny Tan, Assistant Vice President of Enterprise Business Group – Solutions, StarHub (Singapore’s second-largest info-communications operator) and the head of its business solutions.

By Julia Yao

Better late than never

obody who reads this magazine needs to be reminded of the promise of cloud computing, and yet, the key names in cloud computing presently are either Internet or IT firms, not

telcos. Amazon Web Services hosts some of the world’s most prominent sites, such as Netflix, Farmville, and Foursquare, and its cloud service revenue is poised to top USD1 billion in 2012, according to IDC.

So how did telcos miss the boat? Tan attributes this to cultural barriers and a lack of profit pressure during the key window of opportunity ten years ago. “Telcos used to have a quite handsome profit margin in the traditional businesses. Added to that is the cultural difference (telcos are slower to act than Internet companies) in a highly regulated market. So, the majority of telcos didn’t really think innovatively enough to enter this market,” he says. As an IT veteran, he has discovered that the skill sets in the IT and telco worlds are different. “It’s almost like talking a different language.”

However, despite this, he is very upbeat about the competitive advantage that the telco industry enjoys. “Our network touches everything. We telcos are in the center of the connectivity space, without which a lot of the cloud services wouldn’t exist today. SLA is our DNA. For wide adoption of cloud, whether by consumers or enterprises, you really need to have carrier-grade reliability. Besides, we have multiple customer service and support touchpoints. Finally, we have the billing relationships and aggregator abilities… for ISVs (Independent Software Vendors), this is one clear advantage when working with a telco. A lot of ISVs cannot simply scale if they do not partner with someone like a telco and enter into a billing relationship with the customers.”

N

Sunny Tan, Assistant Vice President of Enterprise Business Group - Solutions (StarHub)

NOV 20127 87

Opportunity arises

StarHub is a quadruple-play carrier that operates solely in Singapore, where two-thirds of its business is in the consumer space. Compared with the incumbent, StarHub previously had limited fixed access to commercial buildings, greatly hindering its enterprise business. But in 2010, an opportunity arose in the form of Singapore’s Next-Generation Nationwide Broadband Network (NGNBN), which has the laudable goal of wiring the city-state with ultra high-speed broadband access of up to 1Gbps. Fiber rollout is scheduled to reach 95% coverage by mid-2012. For businesses, this means choice, reduced costs, and increased redundancy. For StarHub, it “levels the playing field for us. We can have complete coverage and access a bigger pool of customers, particularly business customers.” With this impressive leap in bandwidth, StarHub started to provide more data-heavy services, such as telepresence and cloud computing. “We actually timed the launch of our cloud computing initiatives until the NGNBN was in the midst of rollout because you simply cannot run a lot of cloud services on ADSL.”

For StarHub, the decision to enter the cloud was more evolution than revolution. “It was a natural extension of our data center business. We already had the space, the facility; we knew how to build data centers and redundancy. We saw a lot of telco-IT convergence; in terms of customer purchase behavior, they wanted to buy solutions from us instead of hardware and connectivity separately. StarHub is a local trusted brand in Singapore. Especially in the SMB space, familiarity with the brand is very important. We have found that many customers are actually coming to us, asking for SaaS applications as well as infrastructure as a service (IaaS).” One ingredient in StarHub’s recipe for consumer success is what the operator calls “hubbing” (service combination). “By bundling

connectivity, IT services, and SaaS, we are adding a differentiator via cloud hubbing.”

Getting started

StarHub took its first steps into the cloud in 2010 through the offering of SaaS solutions, including accounting, HRM, and sales systems delivered through a utility model to small businesses (SBs) and small-to-medium businesses (SMBs). “Our success was OK, not fantastic. We knew here was still room for improvement, for example, an email/collaboration suite which would be the central identity of the user.” StarHub beefed up its portfolio later with the necessary security elements, so that its customers could sleep easier. Education was also necessary to win over the uninitiated. “We went through a lot of trouble explaining to SBs and SMBs, especially those that were not very familiar with IT, what cloud computing was and how they could benefit.”

StarHub reached a milestone in 2011 when it entered into a syndication partnership with Microsoft that allows the operator to bundle Office 365 with its enterprise broadband services, Microsoft’s second such partnership in Asia. “This is a key step for us, because it allowed us to provide a very important piece called Office 365. In a lot of cloud service brokerage models, one of the critical pieces is the email collaboration portion. This is clearly the first piece any small business or even a mid-market business will ask for when they go into a cloud.”

The market takeup for this caught Tan and his team by surprise. “Even though we targeted the product at SMBs initially, a fair number of customers are in the larger mid-markets. For example, a well-known hospitality and resort chain headquartered in Singapore, with operations all over the world, actually deployed Office 365 throughout the Asia-Pacific, covering multiple resorts and hotels.” Tan is


Our network touches everything. We telcos are in the center of the connectivity space, without which a lot of

the cloud services wouldn’t exist today. SLA is our DNA.

NOV 20127 88

more excited about the new business opportunities this application signifies. “When the hotel HQ’s purchasing decision is done in Singapore, we are in a good position to provide services to the entire footprint that they have. Only cloud enables us to do this… without cloud, we will not be able to sell software, for example, to overseas markets. So this is also changing how we address our market.”

The public cloud is advancing

StarHub’s pursuit in the cloud space has not stopped at SaaS. In February 2012, StarHub, in collaboration with Huawei, made a big step into the public cloud space by launching their public IaaS cloud, branded as Argonar. When asked about this name, Tan explained that the element Argon glows green when ignited, rather like the StarHub theme color. Argonar offers on-demand scalability in computing and storage with carrier-grade connectivity. “Thanks to the collaboration with Huawei, we now have a highly-scalable public IaaS cloud suitable for all sorts of cloud computing purposes. Combined with telco’s reliable network connectivity and security, a lot of customers will find it very advantageous to host mission critical services with Argonar,” Tan adds confidently.

The service is primarily targeted at the SBs and SMBs, allowing them to manage their computer resources with ease without the hefty costs of infrastructure. While this may sound familiar to anyone who has been exposed to the hype of cloud computing, StarHub has added a telco flavor to the service through innovative billing. “One way to sell cloud services is that you go on a pure utility model in which customers bill for every resource they use.”

Through experience and extensive interaction with some of the customers and potential customers, StarHub found that customers were not quite sure how much they would consume. In fact, they were quite worried that the cloud would end up costing more than traditional leasing or acquisition of hardware.

“So we decided that, while retaining some flexibility in the utility model, we would use tiered plans similar to mobile phone plans… for example, we have plans such as 744 computing units per month, which roughly translates to a certain number of services running continuously for 24/7. IT managers would roughly know their normal consumption, and pick the suitable tier. In case of a surge in demand, they can subscribe to a turbo plan and pay more for the excessive usage (similar to what a mobile phone user would do).” This billing model has proven very popular with customers. “It’s quite unique in the Singapore market. For now, at least,” Tan adds with a smile.

Looking back at the public cloud journey, Tan feels very fortunate to have had Huawei as a partner. As StarHub is

relatively new to the cloud, it was beneficial to have Huawei’s support throughout the more than one-year journey from preliminary business case validation to implementation to post-launch marketing consultation. “Huawei worked with us closely to develop the cloud infrastructure as well as our go-to-market strategy. As every operator is different, so is every market and segment. We wanted to have a system that is not too simple so that we can respond to certain demands; we also didn’t want a system that is overly complex that would drive up the costs. We eventually ended up with a system that was just right… one thing that we were particularly happy about was that Huawei was accommodating to changes. As we learned more about the market, we decided to make certain tweaks to our business model, which actually required Huawei to change a fair bit, in terms of implementation of the cloud. We are quite happy that this was done very quickly and nicely. As a result, we were able to launch a product which met all our requirements.”

More to come

So what’s next for StarHub? “Huawei has a very advanced roadmap in enhancing (public cloud) services. We will be working with Huawei on the enhancements, particularly on storage as a service, through the second half of the year… our customers can also expect more exciting SaaS solutions targeted at verticals in both SMBs and enterprise base.”

Looking at the big picture, Singapore has proven very receptive to cloud computing. The government has been advocating cloud computing’s expected boost to productivity, and formulated a strategy as part of a wider effort under Singapore’s new e-Government masterplan (eGov2015). “We were recently selected to be one of the public service providers for the Singapore government. That actually requires us, together with Huawei, to go beyond the quality requirements and respond to clarification requirements of the Singapore government.”

Tan concludes with lessons learned that he would like to share with fellow telcos. “Know your customers and routes to market. We focused on particular segments and sizes of customers. So when we built our cloud services, they were really for particular use. There is really no “one size fits all.” We didn’t want to launch a cloud with enterprise VM-based kinds of offerings. We wanted something that is open, scalable, and ISV-friendly. Also worthy to note is that cloud offers the telcos long-tail profit. In a cloud brokerage model, you can have one app in your platform as SaaS and it’s still profitable for you as a telco. Don’t miss the long-tail opportunities.” One final note he adds, “Although it is not the early days, it is not yet too late.”

Editor: Jason [email protected]

NOV 20129 109


NTT DOCOMO keeps Japan smart

Japan’s smartphone market is expanding rapidly. Users open to new things have adopted smartphones, and operators are finding ways to make users of feature phones join them. NTT DOCOMO is in the midst of enhancing its smartphone strategy, primarily by focusing on Android phones. Kiyohito Nagata, Senior Vice President and Member of the Board of Directors at NTT DOCOMO, discusses the company’s device strategy.

By Pan Jiesun

A smartphone market in flux

martphones have developed rapidly in Japan, with sales volumes far exceeding operators’ expectations. As a leading player in the industry, NTT DOCOMO planned to sell six million smartphones

in 2011, but ended up selling more than eight million. Nagata noted, “While our sales volume of smartphones far exceeds expectations, the growth of sales volume is normalizing. It will become very difficult to maintain this annual growth rate in the future. Smartphones have been very popular among innovators and early adopters. In the future, it is imperative to expand user groups.”

To this end, NTT DOCOMO has adopted a strategy oriented around particular lineups. In 2011, the company divided smartphones into the NEXT and with series, to clearly distinguish target users, high-end and mid-range, respectively. Nagata admitted that “some may prefer the idea of meeting all user requirements with one product, but we think otherwise. To attract mainstream users, NTT DOCOMO launched the with series. Apart from functions and specifications, smartphones should integrate emotional and fashionable elements, and I believe users will love this direction.”

In the feature phone era, NTT DOCOMO divided its products into five series targeted at different user categories, and this sort of strategic segmentation has continued into the

smartphone era, allowing users to choose the model that is right for them. Although smartphones introduced by outside vendors swelled the Japanese market for some time, this wave eventually receded, as most recent bestsellers have been domestic. These models integrate features rare outside Japan, such as e-wallet, 1 SEG (a Japanese mobile TV service), and infrared communications. And while the advanced state of the Japanese market certainly puts it in Japanese vendors’ favor, Nagata argues that “overseas vendors share the same competitive environment with their Japanese counterparts. Indeed, the recent market situation provides many opportunities for Japanese vendors. However, in the era of i-mode (launched in 1999), vendors only needed to develop products according to Japanese users’ requirements, while in the era of smartphones, they must adopt global basic technologies as a basis and try to add relevant functions. In this sense, overseas vendors with global technologies now have more opportunities in Japan.”

NTT DOCOMO has been working with both Japanese and overseas cell phone vendors; speed and cost are what is expected from the latter. In Nagata’s view, most Japanese vendors are not competitive internationally, as they are losing their vitality, while overseas vendors’ comprehensive strength looks more attractive to operators. “Overseas vendors hold absolute advantages in resource allocation. In terms of sales volume alone, overseas vendors have outstanding cost competitiveness and strong fundamentals in terms of development capabilities.”

In other words, the global vendors have an edge in being

S

NOV 20129 1010

— Kiyohito Nagata, Senior Vice President and Member of the Board of Directors at NTT DOCOMO

Some may prefer the idea of meeting all user requirements with one product, but we think otherwise. Apart from functions and specifications, smartphones should integrate emotional and fashionable elements, and I believe users will love this direction.

NOV 201211 12

able to utilize the industry’s fundamental technologies to develop and customize their products, even in a highly diversified marketplace, while Japanese vendors hold the advantage in terms of customization for the local market, but they have weaknesses in terms of cost and development capability. Nonetheless, Nagata deems it meaningless to distinguish vendors by nationality. “This is no longer about the difference between Japanese vendors and overseas vendors; rather, the difference lies in whether they see a global market or not.” Nagata added that in the future, cell phone vendors should focus on R&D capability, develop fundamental technologies that can be applied worldwide, and add localized elements as needed. This last element might require the same amount of investment from both the overseas and Japanese vendors, so the key to competition lies in boosting cost competitiveness in the basic technologies.

Experience counts with smartphones

In the Japanese market, users expect the best, and they purchase products from Japanese vendors believing that they are so. However, Nagata thinks that this belief does not extend to smartphones. “We can no longer assume that Japanese products are high-quality while those from overseas vendors are poor. In the globalized market, what is important is how many high-end products a manufacturer makes and sells. Smartphones are a brand-new product category, where experience counts.”

Nagata would go on to note that the Japanese are expected to be demanding when it comes to quality, and yet in other developed countries, requirements for high-end smartphones are also very high. In Nagata’s opinion, smartphones are a high-end product, so manufacturing skills determine quality; vendors that take the lead and develop new products in the global market and have a lot

of experience in mass production can manufacture high-quality smartphones more easily.

Another potential challenge for overseas vendors is the fact that the Japanese are highly brand-conscious. In Nagata’s view, it is difficult for overseas vendors to build brands in Japan, but there are still ample opportunities. In the past, when Japanese vendors were focused solely on phones intended for use only in Japan, some overseas vendors launched cell phones with GSM roaming functions, while others rolled out low-priced phones to compete while the terminal prices of the Japanese products remained high. Those overseas vendors succeeded in boosting brand awareness and overcame the barriers in branding by emphasizing unique advantages. Nagata notes that “building a brand is indeed no easy job. However, in the last few years, overseas vendors have successfully built some brand awareness in Japan. By continuing to provide outstanding products, they have been embraced by the Japanese market. Compared with before, the Japanese are now more receptive to overseas brands.”

At present, the Japanese market is basically saturated; new subscribers will not grow sharply. At this point, the opportunity for overseas vendors is to provide products with a unique personality that other companies do not offer. In other words, Japanese consumers are looking for something different.

Huawei has withstood globalization

Huawei is gaining a foothold in NTT DOCOMO’s product lineup thanks to the personality reflected in its products. Huawei started providing digital photo frames for NTT DOCOMO in December 2009, and unveiled the HW-02C handset for children in September 2011, which offered simple and limited functionality as well as increased security. According to Nagata, “In the area of devices


In the globalized market, what is important is how many high-end products a manufacturer makes and sells. Smartphones are a brand-new product

category, where experience counts.

NOV 201211 12

oriented towards children, although NTT DOCOMO is a latecomer, with Huawei’s help, NTT DOCOMO is able to roll out products of satisfactory quality, color, and size at preferential prices. The products are highly competitive in sales, with excellent results.”

Nagata would also add that “at first we were not totally confident as Huawei was a relatively new company in the Japanese market, but the results proved we made the right decision.” By partnering with Huawei, “We were able to reduce the overall cost to the point where it would be difficult to achieve it with our traditional partners. This enabled us to offer our services at a price embraced by customers.”

“When introducing premier offerings, NTT DOCOMO teams up with Huawei to provide quality functionality. When rolling out a service that holds no particular advantage at the moment, NTT DOCOMO utilizes Huawei’s fast development model, resulting in net increases in subscribers and contributions to the growth of sales revenue.”

When speaking of the partnership between NTT DOCOMO and Huawei, Nagata noted that “despite differences between the two sides in terms of development philosophy and language, Huawei provided the quality

required by us at the cost agreed upon, eventually becoming our trusted partner. Huawei leads the world in cost and R&D cycle. It has many impressive methods, such as those for adding development resources, and in the use of human resources, that have stood the tests of globalization.”

Looking forward to Huawei’s next hit

Now, NTT DOCOMO is pivoting towards its LTE business under the Xi (crossy) brand name. “Compared with other companies, NTT DOCOMO introduced LTE smoothly. This is our advantage. Users will understand LTE’s unparalleled speed of Internet access once they experience it. We are stepping up publicity of Xi as a flagship offering. DOCOMO is aiming to achieve 40 million smartphone subscribers by FY2015, and this will expedite the expansion of the Xi product lineup.”

At CES 2012, Huawei unveiled the Ascend P1s, then the world’s thinnest smartphone at only 6.68mm thick, as well as a selection of LTE models. At the event, Nagata was deeply impressed by the Ascend P1s. “The attitude of fighting to reduce a mere 0.1 mm shows Huawei’s enterprising spirit. Huawei understands what it should do in the world market and puts it into practice. A latecomer as it is, Huawei is very competitive in the smartphone market. What comments and support the Ascend series will receive around the world are very much worthy of expectation.” As for Huawei’s future development, Kiyohito Nagata is looking forward to any “surprising products” it might offer. “The surprise may come from the creative way that Huawei incorporates our requirements for the services we provide in Japan into its global models, or in the form of a thoroughly customized model for the Japanese market. Either way, we are looking forward to a big surprise from Huawei.”

Editor: Gao Xianrui [email protected]

In the area of devices oriented towards children, although NTT DOCOMO is a latecomer, with Huawei’s help, it is able to roll out products of satisfactory

quality, color, and size at preferential prices, with excellent results.

HW-02C, handset for children

NOV 201213 1413

it moving. All have a role to play in this pipe network, making it easier to manage and use so that customers enjoy enhanced revenue.

Huawei will focus unswervingly on the pipe. It is our primary area of future investment. Some investments will be made in products and solutions that enlarge it, and support its effective billing, management, and maintenance. We will not, however, invest in the content itself (the water within the pipe).

At Huawei, we endorse the idea of “broadband for all.” We are working towards a zero-wait customer experience that features high bandwidth and service diversity. We also actively support and participate in the cloud and M2M ecosystem. Everything that we do will be about making the pipe wider in itself and ubiquitous in its coverage, so that both our customers and ourselves have greater market opportunities to seize.

Huawei’s pipe strategy is a focused one. For consumers, we only provide network devices that generate and consume traffic; non-networked electronics are not our business. For enterprises and industry verticals, we focus on ICT infrastructure and position ourselves as a product provider; we will not develop industry-specific application software. For carrier networks, our focus is architecture, from end to end, so that a high-caliber pipe that channels surging traffic is achieved. The objective of carrier network solutions is to deliver a zero-wait experience with high bandwidth and diverse services.

Huawei has established three different business groups (BGs) to provide ICT solutions to different customer segments – carriers, enterprises/industries, and consumers. However, network devices, enterprise networks, carrier networks, and data center solutions are closely linked and complement one another. Also, technologies used across segments are vertically integrated and can all be traced to the same origin, the digital logic design. Wireless technologies are used for both base stations on carrier networks and

Perspectives

On Huawei’s Pipe Strategy

By Eric Xu, Executive Vice President, Huawei

ompanies choose to position themselves differently in the global ICT (Information and Communications Technology) ecosystem. Some focus on chips, some on basic software,

some on consumer devices, some on content, and others on service operation. Huawei, however, chooses to focus on the pipe, which will direct the development and consolidation of all our businesses.

And by pipe we mean a digital pipe system for carrying information, oriented by technology and sector (the ICT sector). China’s water system makes for an effective analogy. Network devices such as mobile phones can be thought of as the taps. When a tap is open, water flows through, with information generated and consumed. Enterprise networks are like the tributaries or urban water supply systems, while enterprise data centers function as reservoirs. If these intermediate waterways are broad and uncluttered, more water can be channeled into the main pipe, enabling more information exchange and aiding the proliferation of information technologies in the business world. Mobile and fixed broadband networks (MBB and FBB) are the principal rivers, like the Yellow and Yangtze, while data center solutions function as flood basins such as Dongting Lake. And finally, the backbone network is the Pacific Ocean, processing and transmitting information that flows in from tributaries. Together, these elements form a complete pipeline that encompasses the generation, aggregation, transmission, and switching of information, all the way to an “Information Pacific.” In this system, the services business also takes a part as they help manage, maintain, and optimize the pipe network so that it runs smoothly.

IP Video and SDP (Service Delivery Platform) are enabling platforms that help customers generate revenue from their information pipes, while BSS (Business Support System) facilitates pipe operation and service billing. Network power systems get the flow started and keep

C

Everything that we do will be about making the pipe wider in itself and ubiquitous in its coverage, so that both our customers and ourselves have

greater market opportunities to seize.

NOV 201213 1414

Huawei will focus unswervingly on the pipe. It is our primary area of future investment. We will not, however,

invest in the content itself (the water within the pipe).

handsets used by consumers, while IT technologies are applied to both enterprise servers and specialized equipment (e.g., MSC and HLR) on carrier networks. The integration and sharing of technologies makes it possible for us to deliver more competitive products and solutions to each of the three customer segments, at a higher return on investment and lower cost. From this perspective, there are two driving forces that fuel our company’s development. One is customer need, which lies at the core of every solution that we deliver, thus moving our company forward; the other is technology, in that constant technical evolution brings a better experience and lower cost, propelling the industry ahead. These two drivers are interdependent and complementary; neither can be ignored.

Huawei is committed to building a pipe oriented towards technology and sector. We are also committed to serving various types of customers that need such pipes. The world we live in is ever changing, and so are our customer base and their needs. While carriers will certainly continue to invest in the pipe, the Internet service providers may also build their own large-scale pipe systems; enterprises and industry verticals will accelerate their ICT investments as well.

Huawei continues to focus on the customer through the quality that we provide and the services that we deliver, to all customers who need a pipe and can build a win-win relationship with us.

Huawei’s pipe strategy is the company’s core, and the pipe business will remain our focus. As the digital flood approaches, we commit ourselves to enhanced pipe capacity, strengthened pipe enablers, and optimized pipe management, to deliver ever wider and more ubiquitous pipes, and an even better user experience. Huawei is striving to build a connected society with endless possibilities – a society where our life and work are greatly enriched, made easier through communication.

Editor: Jason [email protected] Eric Xu, Executive Vice President, Huawei

NOV 201215 16

ur world has become truly connected. During the past twenty years, we have

witnessed the blossoming of the commercial Internet, which planted the seed of an

interconnected and global digital network that has made such things from email to telemedicine to browsing and social networks to online banking and retailing ubiquitous and affordable.

Cyberspace is a new strategic domain, but it is unlike the physical territory which we are used to. It has gradually become the “nervous system” through which society operates. Countries now attach significant importance to the development of cyberspace technologies. The development of networks helped to advance social progress. Open networks have encouraged information flow and sharing, provided more opportunities for innovations, lowered the costs of innovation, and helped improve the world’s health, wealth and prosperity.

Network technologies have turned out to be remarkable innovations. Open networks have made it easier to obtain and share information and have created untold opportunities for people to invent. As technologies become more pervasive, the costs of innovation are lowered which means that consumer, small and medium-sized enterprises and micro-enterprises have the opportunity to innovate on the same platform as large enterprises.

The development of interconnected networks has encouraged investment and has enabled new consumption models that have driven global economic growth and fueled the global economy. Open networks connect the world, facilitate economic exchanges across regions, and promote global trade. Information technology has become a key driver behind economic growth. As reported by the World Bank, for every 10% increase in broadband penetration, the GDP in developing countries will increase 1.38%.

With the substantial growth in data and the use of technology, we must adopt a positive attitude towards “data floods” and technology – not merely looking at the ills or

complexities that they create. We must utilize information to bridge the digital divide, provide more people with access to communications and information systems, and allocate information resources more appropriately, so that everyone on the planet can benefit from the use of technology. The openness of networks makes it possible for people to have equal access to information, improve social justice, and balance development across regions. The openness of networks has promoted cultural exchanges and helped to soften many of the misunderstandings, acts of discrimination, and cultural conflicts that exist between people with different cultural backgrounds.

Yet, notwithstanding the monumental personal, social,

Cyber security perspectives21st century technology and security – a difficult marriage

O

Perspectives

By John Suffolk, SVP of Global Cyber Security, Huawei

Cyber Security Perspectives21st century technology and security – a difficult marriage

John Suffolk

NOV 201215 16

and enterprise-oriented benefits that we have realised as a result of the digital and broadband revolutions, age-old real-world evils ranging from vandalism, theft, and disruption to espionage and wilful destruction have naturally gravitated to the new digital environment.

Huawei, a global organization doing business in over 140 countries and connecting almost one-third of the planet’s population, is actively engaged in meeting these challenges head-on. As one of the world’s leading ICT solution providers, Huawei has deep technical understanding of how networks operate, and how technology fundamentally underpins and drives the health, wealth, safety and prosperity of citizens around the world.

Yet not a day goes by that we do not read or hear politically – or competitor-inspired negative commentary about cyber security. While worry about breaches of cyber security is understandable and legitimate, the rhetoric risks distracting from the wide range of challenges our industry faces. Achieving an effective, global, industry-wide solution is going to demand sober and fact-based dialogue, not commercial or political jousting.

In a world where over 87% of the planet’s population are mobile users, where the Apple App Store has seen over 25 billion downloads, and where the downloads of Google Play Application Store have exceeded 20 billion, the stark reality is that cyber security is a growing global challenge demanding rational and universal solutions.

No longer is technology designed, developed and deployed only in one country. No longer can any country or large company claim to rely on a single sourcing model, and no longer is it possible, with today’s complex technology ecosystem and architecture, that we can stop all threats from all threat actors.

As governments, enterprises, and consumers have become increasingly reliant on ICT solutions that integrate inputs designed, developed, coded, and manufactured by multiple suppliers around the world, the scale of the cyber security challenge has grown exponentially.

Cyber security is not a single country or specific company issue. All stakeholders – governments and industry alike – need to recognise that cyber security is a shared global problem requiring risk-based approaches, best practices and international cooperation to address the challenge.

With the recent publications of threats such as Stuxnet and Flame, the world has reached a decision point: Does it continue on its current path whereby any misguided actor, regardless of motive, can operate freely in an unregulated world and develop malware for any purpose? If we accept this route, then we must stop complaining and accept the consequences of the cyber race to the bottom of the pit and the return of the Wild West. Or should we collectively step back from the precipice, as we have done in other forms of warfare, and establish laws, norms, standards and protocols – accepting that trust has to be earned and continually validated and also accepting that a lack of trust exists between some stakeholders when it comes to cyber security. In this scenario we must be realistic but determined.

This paper favours and supports international collaboration, openness and verifiable trust as the foundation for a world where technology can continue to drive economic and social improvement for the majority of the 7 billion citizens on the planet. We hope you support this option too. At Huawei we make this commitment:

We will support and adopt any internationally agreed standard or best practice for cyber security in its broadest sense. We will support any research effort to improve cyber defences. We will continue to improve and adopt an open and transparent approach enabling governments to review Huawei’s security capabilities. And finally, as we have done to date, we warmly welcome the assistance from our customers in enhancing our processes, our technology, and our approach to cyber security so that we can provide even greater benefits to them and their customers...

The complete Huawei whitepaper is available at:http://www.huawei.com/ilink/en/download/HW_187368

Cyber security is not a single country or specific company issue. All stakeholders – governments and industry alike – need to recognise

that cyber security is a shared global problem.

NOV 201217 18

LTE TDD goes mainstream

By Daryl Schoolar, Principal Analyst, Infrastructure, Ovum

LTE TDD applications

urrently, operators looking to deploy LT E T D D a r e focused on three

areas – mobile broadband, fixed broadband access, and backhaul.

Mobile broadband

The application that will dr ive the la rges t market opportunities for LTE TDD

is support of fully mobile networks. China Mobile plans to deploy LTE TDD for its 4G network, and to grow its trial network to 20,000 base stations in 2012 and extend it to 200,000 base stations by the end of 2013. Some mobile operators, such as SoftBank (Japan), STC (Saudi Arabia), Optus (Australia), Hi3G (Denmark & Sweden), and China Mobile HK (Hong Kong), either currently have or plan to support both LTE FDD and TDD along with their existing GSM or WCDMA networks. Bharti Airtel has launched LTE TDD as its primary 4G network technology. Clearwire (U.S.) and Mobily (Saudi Arabia) provide good examples of operators migrating from WiMAX to LTE TDD to take advantage of the bigger ecosystem the technology can bring them. The availability of LTE (FDD & TDD)/WCDMA/GSM smartphones later on this year will be the catalyst for mobile broadband development.

Fixed wireless broadband access

Many areas of the world still lack wireline networks, and many of these areas will never see copper or fiber deployments. For these areas, wireless networks remain the best option. Operators such as UK Broadband, SkyTV (Brazil), Zodafones (Nigeria), and Blueline (Madagascar) are using LTE TDD to build out fixed-line networks.

Small cell backhaul

It is LTE TDD’s support of point-to-multipoint that has some operators looking at the technology as a backhaul solution. Plus, as LTE TDD is part of the larger LTE ecosystem, it should also provide cost savings through the overall economies of scale expected to come from LTE. Other point-to-multipoint backhaul systems don’t have this benefit because they are proprietary systems. Backhaul may not be the biggest application for LTE TDD, but it should play a role in helping the technology to scale.

TDD spectrum: An untapped resource

Spectrum is a finite resource; there is only so much available. AT&T’s failed acquisition of T-Mobile was driven by AT&T’s desire to increase its spectrum holdings. The LTE standard, while more spectrally efficient than WCDMA or HSPA, still isn’t enough on its own to meet the spectrum needs of all operators. Small cells are one way of dealing with this issue.

Smal l ce l l s help operators deal with spectrum limitations through carrier Wi-Fi solutions and through increased spectrum reuse with pico- and microcells using licensed spectrum.

The most obvious method for an operator to expand its spectrum position is through the acquisition of more FDD spectrum. This, however, is not always that easy.

Mobile ecosystem puts support behind the standard

C

Perspectives

LTE TDD has gained wide ecosystem acceptance and backing from leading infrastructure and device vendors. LTE TDD holds promise when it comes to providing small cell backhaul and fixed broadband service. Its biggest market opportunity, however, should be in helping mobile operators meet the growing demand for data network capacity.

NOV 201217 18

Government regulators, as in the case of AT&T and T-Mobile, may block the deal. Purchasing spectrum at an auction may not always be an option because of either the cost or the availability. Another option, and one more operators are looking at, is deploying LTE TDD over unpaired spectrum.

Mobile operators can deploy a multi-mode LTE network to increase their overall network capacity. LTE TDD can be deployed in dense metro areas to provide capacity injection into areas where the LTE FDD network is strained. Part of the capacity benefits LTE TDD bring comes in the size of available spectrum blocks.

Unpaired or TDD spectrum bands often come in large blocks. It isn’t unusual to see TDD spectrum auctioned off in 30MHz slices. From a capacity perspective, this is an advantage over the typical 2x10MHz configuration found in FDD spectrum. LTE Release 8 has a theoretical maximum speed of 16bps per hertz; the more hertz an operator has, the faster the network.

TDD spectrum costs much less

The biggest advantage of TDD over FDD spectrum is its cost. Mobile operators have historically been able to purchase TDD spectrum at a lower price than FDD. This has primarily been due to the fact that mobile operators have had limited options for using TDD spectrum. Until now, many of the systems that were available for TDD spectrum were proprietary, and not part of a larger ecosystem. Even with lower spectrum costs, the proprietary nature of those network systems that used unpaired spectrum have limited operators’ interest in networks using TDD. LTE TDD is changing that.

With LTE TDD, operators can use lower cost unpaired spectrum with a networking technology that is part of a

larger ecosystem than that for paired spectrum. This makes the overall cost of the network lower than those using paired spectrum. From a competitive position, this lower cost can make it easier for an operator to rollout a network and achieve a return on its investment. It can also use the lower cost of network ownership to offer lower-priced service and gain a competitive advantage in the market. However, mobile operators do need to be aware that the current spectrum cost advantage may not last. As interest in LTE TDD increases, so too, most likely, will the cost of unpaired spectrum.

LTE FDD spectrum challenges

Despite the popularity of FDD spectrum, it comes with many challenges. One of those challenges is that unused spectrum suitable for LTE FDD may not be readily available. In the U.S. there are ongoing LTE FDD deployments in 700MHz. This spectrum band’s propagation characteristics provide good coverage over large geographic areas. However, 700MHz is not readily available in all markets.

In some markets, TV signals stil l transmit over the 700MHz band. It will take time for those bands to be c leared out and made avai lable for mobi le communications. Competition for FDD frequency brings its own problems as well. The most obvious problem competition brings to FDD spectrum is cost. As has been discussed already, bidding on prime FDD spectrum can be expensive due to high levels of competition for that spectrum. Competition for that spectrum can also lead to it being divided up into small allotments among multiple operators. These allotments can be small in size in terms of MHz or geographic coverage. In either case this will make it difficult for an operator to be successful.

Spectrum is a finite resource; there is only so much available. The LTE standard, while more spectrally efficient than WCDMA or HSPA, still isn’t enough on its own

to meet the spectrum needs of all operators.

NOV 201219 20

Another solution for gaining FDD spectrum comes from refarming.

With spectrum refarming, an operator uses existing 2G and 3G spectrum for LTE FDD. There has been significant interest in using 1800MHz for this. The problem here is that spectrum refarming can take a long time to achieve, slowing down the deployment of LTE. Because of these different challenges with FDD spectrum, the interest in TDD has risen.

LTE TDD has broad support

Global interest

As discussed previously, one of the factors in LTE TDD’s success has been the fact that it has grown beyond just being a ‘China-only’ technology. Ovum has identified 45 LTE TDD network commitments, only one of which has been made by China Mobile. It is also worth noting that the first commercial LTE TDD networks did not come from China, but from operators in Japan, Europe, and the Middle East.

As shown in Figure 1, the global distribution of LTE TDD network commitments will help the technology to grow. It provides reassurance that deployment won’t be dominated by one country. In fact, the size of the Softbank deployment in Japan could make it the largest LTE TDD deployment until China Mobile goes commercial. In terms of just numbers of deployments, India appears to be well ahead of China, with seven different Indian operators

committed to the technology.

Strong device support

Strong device support and wireless technology adoption are very much related. Without strong device support, end users will not adopt a technology. In this regard, LTE TDD appears to have a bright future. Chipset and device vendors have come out in support of the technology. Mobile operators should not be worried that deploying LTE TDD will limit their device choices.

Multi-mode LTE FDD & TDD is promising

Even more promising than just broad LTE TDD support is the support for multi-mode LTE FDD and TDD devices. Devices that support both types of LTE will help drive up device volumes, which will bring prices down, and allow for roaming between FDD and TDD LTE networks.

Chipset vendor Qualcomm, for example, markets a chip that supports both FDD and TDD LTE. These chipsets are also multi-standard with GSM, WCDMA/HSPA, and CDMA support. Multi-standard support is very important, as there will be very little interest in devices that support just LTE TDD within the mobile operator community. Hisilicon, which has multi-mode and multi-band chipsets, already supports category-4 LTE TDD chipsets with 150Mbps in the downlink. On the device front, Huawei introduced the world’s first multi-

Asia Pacific 44%

Western Europe 11%

Eastern Europe 16%

Middle East & Africa 18%

South & Central America 4%North America 7%

Source: Ovum

Figure 1 Regional distribution of LTE TDD network commitments

Perspectives

NOV 201219 20

mode personal hotspot device in December 2011 and a category-4 version will be available soon. Other multi-mode chipsets and devices are expected to follow from other vendors.

LTE TDD commitments coming from leading operators in Brazil, Russia, India, and China will generate the scale needed to sustain long-term multi-mode device development.

25% of LTE connections by 2016

LTE connections can be segmented into three categories – FDD, TDD, and FDD/TDD. Of the three categories, LTE FDD has been more widely deployed and adopted. LTE FDD’s greater number of connections, versus those that involve TDD, can be attributed to two things. First has been the historical trend of most mobile operators preferring FDD spectrum over TDD spectrum. The second comes from LTE FDD’s initial commercial deployments coming in 2009, versus LTE TDD’s coming in 2011.

Figure 2 shows Ovum’s forecast for LTE connections that are only FDD, TDD, or a combination of FDD and TDD.

Despite the head start LTE FDD has over TDD, LTE connections using TDD will account for a significant percent of all LTE connections by the end of 2016. Ovum estimates that around 25% of all LTE connections will either be purely TDD or a combination of FDD and TDD at that time. Of the two, connections that are primarily TDD will account for the majority of those connections. Most mobile operators for the near to midterm will opt for

either FDD or TDD in their existing network, not both.

Infrastructure support is key

Infrastructure vendor support is just as important as that of the chipset and device community when it comes to the long-term success of LTE TDD. Networks are a major investment by mobile operators. Service providers want assurance that the infrastructure community shares their commitment to a technology before deploying it. LTE TDD has support from all the leading infrastructure vendors. In fact, their LTE FDD solutions also support TDD. This allows them to provide operators with a choice between types of LTE along with the option of deploying both.

Market leadership involves many factors

Deploying a network can be a major undertaking that costs millions, if not billions, of dollars. Selecting a network partner is not something operators take lightly. The infrastructure partner plays a major role in the success of the network. That is why a thorough understanding of how different vendors stack up in terms of market leadership is important. It gives mobile operators much needed insight to help guide them in picking their network partners.

One of the most obvious ways to judge market l e ade r sh ip o f vendor s enab l ing the under l y ing infrastructure is to measure equipment shipments. But shipments, especially in the early stage of a market, can

Source: Ovum

800,000

100,000

2011 2016201520142012 2013

300,000

500,000

200,000

400,000

600,000

700,000

Figure 2 Global LTE FDD and TDD connections in thousands, 2012 – 2016

LTE FDD/TDDLTE TDDLTE FDD

NOV 201221 22

be misleading when it comes to true market leadership. A vendor successfully landing one or two early deployments could be a market share leader in the short term, but that position may not hold for the long term. When looking at market leadership in the early stages of a market, other factors beyond market share need to be examined. For LTE TDD, Ovum has identified the following factors when it comes to judging market leadership:

LTE TDD commercial wins – While market share shouldn’t be the only indicator of market leadership, a vendor’s ability to win LTE TDD deployments certainly remains an important indicator of market leadership. Commercial wins provide an indicator of the vendor’s ability to sell its LTE TDD solution to operators. It also provides guidance when it comes to operators’ acceptance of that vendor as a network partner.

Combined LTE commercial wins – Like LTE TDD commercial wins, success in selling LTE FDD is another important indicator of operators’ perceptions of the vendor as a network partner and the quality of the vendor’s network solutions. Furthermore, as mobile operators add LTE TDD to their existing LTE FDD networks, success in gaining those initial LTE FDD wins provides a good indicator of who will win the LTE TDD deployment, especially as those LTE FDD networks also support the TDD variant.

GSM/WCDMA/HSPA market share/experience – A vendor’s previous success in gaining GSM and WCDMA/HSPA market share will impact their success in winning LTE deployments. Vendors have seeded the market for some years with multi-mode base stations. Those base stations help ease some of the pain that operators will face as they transition from 3G to LTE. Being the incumbent 2G or 3G vendor certainly gives that company an advantage when the mobile operator starts to look for

LTE network partners. Furthermore, 2G and 3G success gives vendors credibility with mobile operators in terms of technology development and their ability to support network rollouts.

Unpaired spectrum experience – Prior to LTE TDD, the most common network technologies to use unpaired spectrum were TD-SCDMA and WiMAX. Experience in deploying these technologies gives infrastructure vendors important experience in deploying networks that use time division duplexing. Not to be overlooked is the trend with WiMAX operators like Clearwire (U.S.) and Mobily (Saudi Arabia) to deploy LTE TDD. Having a WiMAX customer base gives vendors increased sales prospects for their LTE TDD gear.

LTE TDD device support – End-to-end LTE network support is common with the major infrastructure vendors. All of them can deliver base stations, backhaul, and packet core solutions to operators. But, device support can be a real differentiator for a vendor, especially in the market’s early days when device availability can be limited. Being able to deliver devices, along with infrastructure, can ensure that operators can sell services on their new network. Having control of chipset development also helps here.

2G/3G leaders should dominate LTE TDD

For 2011, Ovum estimates that Ericsson, Huawei, and Nokia Siemens Networks generated over 70% of global base station revenues. This includes revenues for all the major wireless standards – GSM, WCDMA/HSPA, LTE, CDMA, and WiMAX. Because of these vendors’ existing mobile infrastructure positions, they should be in the best position to capitalize on LTE TDD in the long run.

As mobile operators add LTE TDD to their existing LTE FDD networks, those initial LTE FDD wins provide a good indicator of who will win the LTE TDD

deployment, especially as those LTE FDD networks also support the TDD variant.

Perspectives


NOV 201221 22

NOV 201223 24

Huawei knows LTE TDD inside & outMobile data services are quickly becoming key profit drivers for operators. LTE TDD, through its ability to

exploit unpaired frequency bands, can be the technology that brings these services to life, and its utility is

being demonstrated through its growing ecosystem, where Huawei is well represented.

By Deng Taihua, President of LTE TDD & WiMAX & TDS Network, Huawei

A GAS-powered technology

TE TDD is a global, asymmetric, synergistic (GAS) technology.

Global: Large sections of contiguous unpaired spectrum are readily available in most countries.

The mainstream TDD bands are at 1.9G/2.3G/2.6G/3.5G and total over 700MHz of bandwidth, bringing high peak rates and global LTE roaming within reach.

Asymmetric: LTE TDD does not need the same bandwidth for downlink and uplink, and this bandwidth need not be constant. Both of these properties better

Tao of Business

reflect the real-world needs of mobile users, where irregular consumption with the occasional upload is the norm.

Synergistic: LTE TDD shares 90% of its technology with LTE FDD (based on 3GPP standards), enabling an easy evolutionary path from WiMAX or TD-SCDMA, as well as interoperability with GSM, UMTS, and CDMA.

At least half of the world’s top 150 operators possess TDD spectrum, and its value keeps increasing. In 2011, the average price of 2.6GHz spectrum was thirteen times what it was in 2009, a year that saw 90MHz of 2.3GHz bandwidth go unsold at auction in Hong Kong, only to sell three years later for USD60 million to three different competitors after fierce bidding.

L

NOV 201223 24

those aforementioned data services can be delivered at higher speeds, while RIL (India), Mobily (Saudi Arabia), and UKB (U.K.) are focusing on it as a low-cost last-mile option for wireless broadband (WBB), and Vodafone (Europe), and Bell Canada are strongly interested in using it as a microwave supplement.

Presently, there are some big-time LTE TDD rollouts either in progress or on the horizon. SoftBank currently has the largest commercial deployment in the world, one that will utilize its 160,000 existing base stations (acquired from Willcom) in the near future. China Mobile has even bigger plans, as it looks to expand its network from 20,000 trial stations to over 200,000 commercial ones over the next few years.

More mainstream operators will soon join the LTE TDD development game. It is estimated that more than 70% of sizable sales of LTE TDD gear goes to traditional GSM and UMTS operators, which has helped motivate all the major vendors to offer LTE TDD solutions, including the names normally associated with LTE FDD, as the aforementioned 90% overlap keeps its time-division-duplex cousin from being too much of a stretch.

Huawei leads the way

An army of experts

LTE TDD is a priority investment at Huawei. In addition to the 14,000 employees and 11 R&D centers that we devote to wireless technologies, Huawei has more than 4,000 engineers researching and developing LTE TDD full-time. Since 2010, Huawei has put forward over 260 proposals that were eventually adopted as LTE core standards (20% of the world’s total).

All these efforts have given Huawei an unsurpassed

LTE TDD does not need the same bandwidth for downlink & uplink, and thisbandwidth need not be constant. Both properties better reflect the real-world needs of mobile users, where irregular consumption with occasional upload is the norm.

Of course, M&A works just as well as auction if not better, as has been seen in a slew of such moves over the past few years, such as SoftBank’s 2010 acquisition of Willcom and Optus’s more recent acquisition of Vividwireless. TV whitespace spectrum below 700MHz will also prove suitable for LTE TDD, if available.

The pieces are in place

As integration becomes the industry norm, multi-mode chipsets that cover a diverse range of frequencies have come online. In April 2012, Qualcomm unveiled its fifth-generation chipsets, which support GSM/CDMA/UMTS/TD-SCDMA/LTE TDD/LTE FDD, spanning seven simultaneous radio frequency channels, while Hisilicon has released multi-mode chips that support simultaneous GSM/UMTS/TD-SCDMA/LTE TDD/LTE FDD, and other vendors are following suit.

LTE TDD terminal development is also taking shape. According to GSA statistics, a total of 67 vendors introduced 417 LTE devices by June 2012. Among them, a total of 53 LTE TDD devices support Band 40 (2.3G), while 64 devices support Band 38/41 (2.6G). Thus far, these devices have taken the form of dongles, Mi-Fi hotspots, and CPE, but LTE TDD-compatible smartphones finally joined in the game this October.

The first small steps

LTE TDD, with its robust compatibility and capacity (on par with fixed broadband), can satisfy a diverse body of network operators. SoftBank, Bharti Airtel (India), STC (Saudi Arabia), and Optus are aggressively developing this technology for mobile broadband (MBB) so that

NOV 201225 26

LTE TDD is a priority investment at Huawei. With an unsurpassed authority in LTE TDD, Huawei offers solutions that boast the best performance, best

convergence, and best end-to-end innovation on the market.

authority in LTE TDD that reflects in our relevant solutions, which offer the best performance, best convergence, and best end-to-end innovation on the market.

Best performance

Huawei LTE TDD technology has been tried & tested in some of the world’s most complex and strenuous traffic scenarios (think Tokyo). Key technologies in these instances include our multi-antennas, which improve cell edge speed through beamforming (BF), from single layer to double layer, as well as to multiple users.

Single-layer BF can improve cell edge rate by 30% in real-world scenarios, while our single frequency network (SFN) technology can boost this by a further 50%. Our intelligent baseband array (IBA) can enhance inter-cell performance as well. Huawei is the first to put uplink coordinated multipoint (CoMP) technology (a feature of LTE-Advanced) into commercial use, leading to an over 7% increase in average uplink rate.

Best convergence

Huawei SingleRAN makes LTE TDD compatible with any mobile commercial network. This has been seen with the likes of SoftBank (UMTS), STC (GSM/UMTS), China Mobile (GSM/TD-SCDMA), Mobily (WiMAX) and Aero2 (LTE FDD).

This solution also makes Huawei the only vendor in the industry to support LTE TDD and all other wireless modalities through a single BBU; different modalities can be engaged and interact as coverage, location, workload, SPID, and PLMN dictate to maximize integration

Tao of Business

NOV 201225 26

As of end of June 2012, 29 LTE TDD networks were deployed or were being deployed worldwide, and Huawei was involved in 21 of them,

often in the operators’ most valued regions.

Editor: Pearl Zhu [email protected]

performance.

Best end-to-end innovation

Huawei provides a complete lineup of LTE TDD terminals, which boasts several industry firsts. In 2011, we released a LTE TDD/LTE FDD dual-mode data card, multi-mode data card for GSM/UMTS/LTE TDD, indoor CPE, multi-mode mobile Wi-Fi for GSM/UMTS/LTE TDD, and outdoor CPE, all world’s firsts. In 2012, we have followed these up with our first LTE TDD smartphones.

A large number of other LTE TDD innovations have also joined the party. In May 2012, Huawei’s TD-Fi solution found its way into a commercial trial on a bus line in Hangzhou (a Chinese provincial capital), delivering an average speed of 40-50Mbps for offload. Moreover, our eRelay solution, based upon LTE TDD, can provide backhaul for macro and micro base stations and support both point-to-multipoint and non-line-of-sight transmission, while our eMBMS technology helps the offering of live IPTV services or push video over LTE TDD by allocating additional downlink resources for broadcasting.

We’ve got references

As of end of June 2012, 29 LTE TDD networks were deployed or were being deployed worldwide, and Huawei was involved in 21 of them, often in the operators’ most valued regions.

As the world’s No. 1 provider in terms of ARPU for mobile Internet data services, SoftBank focuses on LTE TDD as its major evolution route to LTE. In September

2011, the operator selected Huawei as its strategic partner to build its LTE TDD network in Tokyo, Osaka, and Nagoya. According to an evaluation of Tokyo’s four newest networks by the ICT, a well-known professional evaluation agency, “SoftBank’s AXGP (LTE TDD) by far outperformed all other networks.”

As China Mobile’s partner, Huawei has deployed networks single-handedly for world-class gatherings such as the 2008 Summer Olympic Games, the 2010 Asian Games and the 2011 Universiade Games. As a key partner in the Global TD-LTE Initiative (GTI), Huawei works closely with the GTI to jointly hold global events and other activities, such as “TDD Nights,” that promote industry development.

Huawei is also dedicated to promoting the development of the industry ecosystem. Hisilicon has introduced LTE TDD single-mode chips and LTE TDD/LTE FDD multi-mode chips ahead of the competition. Its latest GSM/UMTS/LTE multi-mode chipsets support LTE with a single-user rate of 150Mbps. Huawei has also opened multiple LTE TDD interoperability testing labs in cooperation with other chipset vendors.

At the June 2012 GTB Innovation Summit, SoftBank’s LTE TDD commercial network in Tokyo won the award for LTE TDD network innovation.

At the May 2012 LTE World Summit, Huawei won the awards for Most Significant Development for Commercial LTE Networks by a Vendor and Best LTE Core Network Element. These awards have joined our numerous others from 2011, demonstrating our leadership in LTE TDD, as attested to by the likes of Ovum, Dell’Oro, and the GSA.

NOV 201227 2827

The foundations matter

he structure of a national fiber broadband network and the regulations that govern it have a big influence on the opportunities

for revenue-generating services. The broadest marketplace is always going to be based on an open-access or wholesale model supporting many service providers.

There are different structural models and the choice is usually dictated by the practical and necessary concerns of the existing operators, perhaps including a state-controlled incumbent. There is no single regulatory structure suitable for all situations, but the most important layer is that which provides wholesale network access to the retail service providers (RSPs). This is where innovation and competition drive the large-scale benefits.

Managing CAPEX

The biggest financial issue is the high capital cost of network construction, especially the civil works. Digging roads is expensive, aerial wiring less so, but last-mile connections will still account for around 50% of the project cost; money that is spent in advance of any revenue earned. Government grants, subsidies, or loans designed to promote the project have the strongest effect here.

Monetizing the NBN

Strategies & services

By Nigel Bruin, Director Business Consulting, NBN Competence Center, Huawei Singapore

T

National Broadband Networks (NBNs) are being planned and rolling out around the world, promoted by a strong convergence of interests, with governments looking for macroeconomic

benefits and telcos looking to satisfy their subscribers’ demands for improved services. The problem for telcos is how to cover the costs of building these next-generation networks.

Tao of Business

The other major factor affecting the return on investment is the take-up rate by subscribers; sharing the cost of the last-mile infrastructure as widely as possible lowers the per-connection costs dramatically. The competitive environment influences take-up rates but so does regulation of elements such as the decommissioning of legacy infrastructure. Once built, a passive optical network (PON) is cheaper to operate and maintain; in Japan, NTT estimates a 60% OPEX savings over DSL. PON also, crucially, offers the lowest cost-per-bit

transmitted, which is ever more important each year as data volumes surge on both fixed and wireless networks.

The Internet is fixedFixed and wireless operators have been drifting apart for

years by divestiture, but mobile operators’ successes with UMTS and now LTE highlight the pressing need to get all this data onto fiber as quickly as possible. It has taken a while for operators & subscribers to realize that Internet access is the major killer app for mobile phones, but since the Internet is a wireline network with a thin wireless edge, there are pressing requirements to deploy fiber backhaul to base stations, Wi-Fi offload, and residential small cells, all of which can benefit from a national fiber infrastructure.

Telco substitution

NOV 201227 2828

There is an industry-wide transformation currently taking place that perhaps rivals the other great industry change (where the telephone companies became ISPs) where charging for access is being replaced by the offering of value-added services (VAS), either directly or indirectly, on a wholesale access network. The end goal is much closer to that for an ICT company as opposed to a traditional telco. In a sense, this places the operator in competition with the entire Internet, a daunting prospect and one that cannot be won outright; OTT services cannot be eliminated or defeated, so how does a telco develop a successful monetization strategy for fiber access?

OTT triage

The initial approach is to triage (separate into three categories) the major services that subscribers use and decide how to offer each one. Operators can:

• Compete using an in-house version (Access Independent Services).

• Cooperate with a third-party provider.• Leave it to the OTT market.Clearly, this must be mapped against one’s organizational

capabilities & strategies such as the technology roadmap, product development capacity, and risk-revenue assessment. The pace at which an operator can challenge OTT services depends not only upon its ability to take on new skills but also its willingness to displace legacy services. Incumbent operators tend to view these risks differently from new market

Operators of POTS networks have seen steady declines for years; a 7% annual revenue loss is occurring now in some markets. Globally, the number of mobile lines surpassed fixed ones in 2003 and it is now numerically dominant. It is true that for some, fixed-mobile substitution is an option, but the bigger issue is one prompted by the latest fast fiber connections providing 50Mbps and often more, as their ability to substitute all traditional telco services, including voice & video, with Internet-based alternatives heralds an era of credible telco substitution.

Shifting revenues

Fiber networks are enabling rapid and disruptive shifts in services (revenues). For a basic broadband provider, these are challenging times. Broadband was once sold by speed (1Mbps, 4Mbps) or in some markets by monthly data volume (5GB, 10GB); neither is a satisfactory way to manage NBN as both have the effect of depressing use, and yet if the service is being sold on a fixed monthly tariff, applying limits seems like a rational response.

A third way, charging for every byte transmitted, is seriously flawed as the value of each byte varies greatly depending upon the application, and consumers have become comfortable with predictable monthly bills. The challenge is granting reasonably generous access to data and gaining revenue from the value that it represents.

Less telco, more Internet

NOV 201229 30

entrants, as even the perception of value destruction may be harmful to shareholder interests. However, market disruption is tough, and courage is required to move forward boldly and disrupt your own services before the new ones gain revenue.

Revenue capture

An operator has a core set of services, voice, data, and often video, available on the fiber network. OTT services that pass through the network are a serious challenge and the telco should decide for each category whether to develop a competing VAS or enter a cooperative partnership.

The form of such an alliance depends on what value the telco is offering. If the value is simply the access network, then it is a form of managed wholesale. If the telco is adding further resources such as CDN or compute servers, then it is a hosted model. More intriguing are the opportunities to manage data flows using QoS, or to add ancillary functions such as billing, providing a classic two-sided business model and putting the telco firmly in the middle of the value chain.

Many major operators have developed their own products, keen to address competition in basic voice services by upgrading to VoIP services and Internet video conferencing through well-known OTT players.

Pay TV

Streaming video is a major revenue opportunity but it is also costly to transport. Pay TV is a little different from many OTT services as it already has a natural two-sided business model, with operators providing the hosting, distribution, and marketing for content providers. Operators have been following a model closer to that used by cable TV providers through partnering with either content owners directly or with an Internet-based distributor. Either way, by improving service quality over OTT through less buffering, assured bandwidth, and perhaps a

sophisticated home terminal, operators can add significant value.The latest hybrid home terminals that present multiple

video sources in a single, consistent user experience are an opportunity for telcos to become the common platform for home video.

Expanded market reachAs operators develop VAS services beyond simple access,

they have the opportunity to offer them across the entire NBN, and even to Internet subscribers. It only seems fair that, in developing services to compete with the Internet, one can expand the addressable market and become a reverse OTT service provider.

Competitive voicePOTS voice is in slow decline in terms of both penetration

and revenue, but it is still a core telco service and one with plenty of innovation left in it. Voice revenues are not going to collapse due to OTT VoIP providers as they find it difficult to compete with the telcos due to issues of numbering, call quality, and ease of use.

Operators are responding by maintaining legacy voice services and enhancing them with Unified Communications (UC). By focusing on legacy strengths and certain OTT weaknesses, voice can be transformed into a competitive offering through initiatives such as Rich Communication Suite (RCS), marketed as joyn. Building on an IMS platform, RCS is a telecom-based UC solution, offering multiplatform clients, presence, and media sharing, backed up by carrier-grade implementation and familiar numbering. The enterprise market places great emphasis on call quality and such an in-house solution can meet their expectations, but it faces strong competition from Internet services; so for incumbent operators, this helps to reduce churn.

Quality of experience

Tao of Business

OTT services that pass through the network are a serious challenge and the telco should decide for each category whether to develop

a competing VAS or enter a cooperative partnership.

NOV 201229 30

It is common practice to tier Internet access plans by speed and/or data cap. Next-gen fiber access permits further differentiation to monetize the experience using quality of experience (QoE) to control traffic speed & priority, not just statically but on demand (Turbo Button). This capability is not unique to fiber, but GPON’s very high line speed and fully-configurable traffic shaping make this an attractive and achievable proposition. This opens up a world of possibilities for optimizing user experience to immediate needs, and hence a new set of chargeable features.

Advantage: OperatorCompeting effectively against new services is a challenge

but operators have significant advantages over OTT providers. Firstly, operators have an existing subscriber relationship, supported by their brand. This should make marketing, service activation, and billing a smoother process.

Secondly, GPON provides excellent bandwidth and traffic control functions and the ability to differentiate based on QoE, which an OTT provider cannot equal. Thirdly, operators often have internal assets such as caching, storage, computing, and billing, that they may leverage to develop new services either by themselves or in collaboration. Because market disruption favors first-mover advantage, partnering to compete with OTT is a feasible and, indeed, recommended way to reduce the time to market.

Telco cloudMoving computing resources and their applications onto

the network is a defining transformation of our age that has been accelerated by widespread availability of broadband access. Telcos are very well placed to offer cloud services, but this is a medium to long-term development project, best taken in phases since it involves a lot of technology; building the skills and competencies takes time.

Successful cloud deployments need to acquire scale to be cost-effective and a typical approach is to start by virtualizing existing services and growing from there. Some of this infrastructure may exist already, often from CDN and enterprise products. Offering a full stack of software products can be approached by beginning with an infrastructure product (IaaS) and then partnering to provide applications (SaaS). Operators can compete effectively against the major global SaaS offerings by providing local support or training to local SMEs who are quick to appreciate their benefits.

Bring it all togetherThe strategic challenge for operators is to choose how

far to go in addressing the OTT value chain; while the opportunities are considerable, so are the risks. If an operator focuses on their traditional revenue stream and tries to grow organically, there may be less internal & financial risk but competitive pressures from disruptive competitors may prevail. As operators balance these issues, the deployment of an NBN acts as a catalyst to market change. Thus, a wait-and see approach is unwise as it risks a dangerous convergence of exploding costs and revenue stagnation.

Broadband access is becoming a commodity and fiber networks promote and accelerate this trend, expanding the full potential of the Internet directly into homes. Fortunately, NBNs also offer the solution to the disruptions they introduce through a platform for innovative, next-gen services and finely-tuned user experience. Their speed, latency and bandwidth permit even more exciting solutions and business propositions.

Telcos must steer a course through these uncertainties. According to an Ovum study, globally, new telco products are expected to grow at 9% annually compared to only 3% for traditional telecom services. This revenue opportunity should act as a lighthouse when crafting business and technology strategies, drawing the operator towards a brighter future.

QoE is a subjective concept that covers the following attributes at the minimum:

Speed – This encompasses not just the allocated network bandwidth (pipe size) but the perception of speed (response time). The usage pattern of an individual user is often very bursty and the challenge for the network designer is to engineer an end-to-end capability that meets this expectation.

Quality – Media quality for high-definition (HD) video & voice, augmented reality, and other aspects of the user experience are readily perceived and appreciated by consumers.

Equivalence – This means having the same content or capability in different places or on different devices. Whether we are in a post-PC world or not, consumers are already using a variety of fixed and mobile devices to suit their needs and tastes.

Simplicity – Consumers want to communicate in simple and natural ways and the user interface (UI) should reflect this desire. Fortunately, effective touch and voice interfaces are available.


NOV 201231 32

How can telcos get a piece of the OTT pie?

By Mike MacDonald, CTO and Executive Solutions Consultant, Huawei Southeast Asia

As the Internet is increasingly dominated by video, OTT will further cripple the telco industry

unless both sides learn how to work together for the benefit of all. It will probably be the operators offering

the first olive branch, but such is the burden of leadership.

Tao of Business

F

Frenemies

or many, the phrase “over the top” may simply mean “to the extreme.” But, in telecommunications, it is a phrase that cuts the air like a knife and takes our wallet while doing so. Wikipedia defines it as the

“on-line delivery of video and audio without the Internet service provider being involved in the control or distribution of the content itself.” In present terms, OTT has been extended to encompass virtually any service or content delivered over infrastructure not controlled by the owner of that service or content. As such, it typically bypasses an operator’s ability to apply bandwidth management, quality of service, billing, etc.

For the time being, the OTT and telco realms act like teenagers at a middle school dance - boys on one side, girls on the other, everyone acting skittish. Basically, this is the result of the rapid rise of the webscape and telcos’ inability to successfully retrain layoff targets to be whiz-bang software designers. As a result, the services that subscribers actually want to access are not directly linked to data plans offered by most telco marketers.

Clearly it makes sense that a subscriber who wants to download a movie for a few dollars needs to consume an appropriate amount of bandwidth, but how much? Even the best engineers struggle with this as video can be encoded using one of many codecs, and can sometimes change on the fly through a process called transcoding. In addition to the sheer number of bits consumed, the width of the data highway needs to be wide enough to support the screen in question (10-inch tablet to 40-inch flatscreen). Already you can see how difficult it would be for a subscriber to purchase a movie and then figure out exactly which data plan makes sense to use.

Fair seems foul

NOV 201231 32

Interestingly, most telcos already have investments in application-aware networks, policy control & charging, and sophisticated billing, yet for some

reason these aren’t leveraged to align with subscriber usage.

If we extend the example to assume subscribers are starting to sign up for monthly subscriptions such as Netflix, now we come head to head with the dreaded “Fair Use Policy,” which perhaps, contrary to consumer logic, protects fair use for other people while limiting your own bandwidth if you happen to watch all eight seasons of How I Met Your Mother in one month. A quick search for “Fair Use Policy” in Wikipedia actually redirects to the incredibly disheartening “Bandwidth Cap” entry. Let’s digress a bit and investigate a paraphrased definition of unreasonable use from a leading telco’s terms of service:

“The unreasonable use of data services where your use of data services is reasonably considered to adversely affect the network or other customers’ use of or access to a service or the network.”

So basically, if you use the service too much and that use adversely affects other users, even though you have subscribed to a predetermined bandwidth package, the telco reserves the right to “suspend or limit the Service (or any feature of it) for any period We think is reasonably necessary.”

This is getting scary, especially as the definition of “too much” seems to mean “your usage is affecting other subscribers.” This is all well & good, except for the fact that it depends as much on what other subscribers are doing as on what you are doing, and the statistics indicate that both you and them are probably watching a True Blood marathon.

The future is now, and it’s in HD

Internet video traffic is expected to consume 54% of all consumer Internet traffic in 2016, up from 51% in

2011, and this does not even take into account video peer-to-peer (P2P) file sharing. All forms of video (TV, VOD, Internet, and P2P) are expected to total 86% of global consumer traffic by that time. And that’s not all – two-thirds of the world’s mobile data traffic is expected to be video by 2016; this would account for a 25-fold increase from 2011 levels.

The monthly subscriber, who after happily paying thirty dollars per month for a 10Mbps connection and another seven dollars monthly for Netflix, now stands a very high likelihood of his bandwidth being throttled back to a few hundred kbps because his insatiable Stargate fetish is adversely affecting the little old lady across the street trying to selling tea cosies on eBay.

This dilemma extends to VoIP, IPTV, streaming audio, and pretty much anything else that isn’t text or voice. Interestingly, most telcos already have investments in application-aware networks, policy control & charging, and sophisticated billing, yet for some reason these aren’t leveraged to align with subscriber usage.

We’d better dance before the music stops

OTT players don’t know networks, and telcos don’t know applications. There are network performance problems that can be fixed through better code and there are web performance issues that can be fixed with a better network, yet both factions choose to go it alone, thinking they are closer to the holy grail than the other. The truth of the matter is that the customer trumps all and in his mind the application or content is intimately linked to the

NOV 201233 34

network over which it rides. But when the two don’t jive, it’s usually the suits at the telco that get blamed rather than the hipsters at the web service.

However, things are not as bleak as they seem. Some operators are changing their ways and offering data packages that align with subscriber usage in the form of a dollar a day for Facebook, a dollar a day for WhatsApp, or forgoing a data charge altogether if a preferred OTT service is used such as Skype (Verizon). While this model, which aligns pricing to services consumed, is a good start, it likely won’t prove a sustainable revenue stream in the face of a fickle crowd, as a firm can go from hipster to whipping boy in less time than it takes to say Facebook. Instead, telcos need to make their assets available to the web developer community, even if it means handing the reins to a younger generation.

Of course there will be some services that can be more localized such as VoIP, IPTV, and mobile money, provided they still offer the ability to tap into the offerings of global players. I recall the sole reason that a Thai friend told me for choosing an Android tablet rather than an iOS product was simply that a credit card was required to create an account for the latter’s application store. It may sound simple, but we can’t dismiss the fact that connecting the next billion will not be as easy as connecting the first. What got us here won’t get us there.

Forward-thinking operators are now realizing that their leverage over OTT players is limited. A relatively large dustup happened in May 2012 when KPN and other Dutch operators announced their plans to surcharge for OTT applications, including Skype and WhatsApp, leading the Minister of Economic Affairs, Agriculture and Innovation to put on his Net Neutrality hat and announce that “Dutch telecom law will be amended to ensure free access to the Internet.”

Telefónica, the s ixth largest te lecom operator worldwide, has announced a partnership with Google,

Facebook, Microsoft, and RIM for carrier billing which will enable subscribers to use their mobile credits to purchase applications and other virtual goods made available at OTT stores, effectively making the purchase of virtual goods and applications much more accessible to subscribers.

In June, TELUS signed an agreement with Skype that “will revolutionize how TELUS smartphone customers use Skype, including the ability to purchase Skype Credit through their existing TELUS accounts.” Just a few years earlier, TELUS was also one of the first to extend their IPTV service to the Microsoft XBOX.

In the middle of these two extremes, we have other operators that are trying to find a sweet spot between their home grown applications and those of OTT providers. Comcast thinks it can benefit from Skype (which now reaches well over 800 million subscribers), albeit in a limited fashion, by enabling calls to and from set-top boxes through an adapter but forgoing support for calls to and from actual phone numbers, which will instead be supported by a Comcast in-house solution.

Now what?

Dr. Hugh Bradlow, CTO of Telstra, Australia’s largest mobile operator, recently announced that operators must stop competing with OTT and instead focus on working with them to benefit all.

Some applications make more sense for near-term tie-ups, such as mobile money. In countries where credit card penetration is under 10% and bank account penetration is under 40%, subscribers simply don’t have the local payment facilities available to enable the full webscape experience. Instead, local operators can leverage their thousands of paypoints in combination with strong relationships with local banking institutions. At the end

Offering data packages that align with subscriber usage likely won’t prove sustainable with fickle users. Instead, telcos must make assets available to web

developers, even if it means handing the reins to a younger generation.

Tao of Business

NOV 201233 34


available to that carrier’s subscriber base. While care must be taken in how telcos open these APIs, it is easy to see the immediate benefit of Farmville integration with a carrier’s billing API so that players can purchase their way onto the leaderboard.

However, a problem here is that OTT players have been groomed through sites such as Mashable and Kickstarter to think that their only mission is to get VC funding and ultimately exit via IPO or buyout. Perhaps telcos can allocate some funds to an autonomous business development arm that could fill this function, choosing several applications to invest in, with the exit strategy being real sustainable revenue. Granted, this may not be as cool as a million-dollar payday, but a steadily growing monthly income that is ten times more likely to be realized is a great alternative, provided telcos can hold an OTT player’s attention long enough to enunciate the reasoning here.

Clearly there is an opportunity for OTT providers to work with telcos, even if the other guys don’t realize it yet. Much like a good coder managing the CPU and memory resources of a computer, a good web application developer should similarly ensure that the infrastructure is capable of delivering the service with the intended customer experience. Change will require a concerted effort on our part to educate the OTT players on what they don’t know and make them aware that the applications they are creating do impact the underlying infrastructure, and an alignment between telco priorities and OTT business cases. More importantly, it will require a high level of autonomy for business development teams, to enable them to properly motivate OTT players and ultimately capitalize on the dynamic nature of the application-based Internet. One thing is certain, if we wait for OTT to come knocking on our door, we will definitely miss the party because ultimately our role in the future of the webscape is ours to lose.

One thing is certain, if we wait for OTT to come knocking on our door, we will definitely miss the party because ultimately our role in the

future of the webscape is ours to lose.

of the day, employees are paid either in cash or via direct deposit into a bank. From there, the existing facilities allow them to purchase a load card and, if lucky, carry an additional balance that can be used for other transactions.

Mobile money will be quickly followed by VoIP and IP messaging tie-ups as operators are forced to replace their traditional voice and SMS revenue with more youth-friendly versions sporting emoticons and SNS integration. In fact, the first carrier-based IP communication apps will effectively be the first IP apps to support carrier billing.

Assuming we can get full alignment from the content sources, IPTV seems like the next logical step for several reasons. First, video takes up more Internet traffic than water does the human body. Second, because video is so dominant, it is the driving force behind the data surge. The problem now is that the OTT technologies available today are predominantly based in the U.S. and thus have more direct access to a lot of the content owners. They also are better at finding that sweet spot between ad-supported applications and customer-billed applications. This June, Netflix celebrated the milestone of serving one billion hours of video in just one month, spread across a user base of 26 million people, making it the largest VOD provider in the U.S. Combine this success with Apple’s recent expansion into 12 new markets in Asia and it won’t be long before the Netflix market is extended globally.

Let the right ones in

Finally, all those other OTT-developed apps that seem like fads or are otherwise hard to fit into a partnership model can still be leveraged in a professionally-managed carrier development environment. This sandbox is where the carrier API is exposed and young people looking to test their coding prowess can create a developers’ account and, after passing a qualification process, make an application

Winners

NOV 201235 36

HomeSafe, the U.K.’s first and only network-level broadband security service provided by fixed broadband operator TalkTalk, is a parental control and anti-malware solution for all devices that use the home Internet connection – including PCs, tablets, smartphones, and even game consoles – putting parents in charge of what their children can visit online and when.

provides online protection for familiesTalkTalk

By Michael Huang Editor: Jason [email protected]

NOV 201235 36

Giving parents peace of mind

s the father of two young netizens in Great Britain, Mr. Smith knows that broadband is an integral part of family life but he does have concerns about his

children being online. After they come home from school, they promptly start browsing the Internet and talking to friends online rather than doing their homework. He is also worried about them stumbling across inappropriate content. To ensure that their homework gets done, he even resorted to turning off the modem, but this also hindered his own Internet access.

Mr. Smith needs a flexible parental control service, one that can filter out the online junk food and ensure his children’s studies. He also needs it to be user-friendly, as he doesn’t have the time or the inclination to deal with a lot of jargon and configuration. A security suite would also be nice, one that can weed out viruses, malware, and other intrusions.

TalkTalk: The family operator

Since its founding in 2002, TalkTalk has steadily grown into the U.K.’s leading value provider of fixed broadband and voice telephony services,

serving some five million customers. TalkTalk offers a clear and simple tariff structure, competitive prices, and innovative services. Examples include its £6.50 unlimited broadband & calls a month bundle and its superfast (up to 76Mbps) fiber broadband.

TalkTalk’s customers are primarily households, where children are likely to be sharing the same Internet connection as their parents, and a lot of that time is unsupervised.

TalkTalk’s own Life Online study has shown that about half of children’s time online is unsupervised, and at least 14% of children aged 6-10 have encountered adult content on the Internet. Web attacks at home are also increasing. According to a Symantec report, the spam level in the U.K. in June 2012 was 67.2% and 1 in 210 emails was identified as malicious.

TalkTalk identified a need in the marketplace for a simple, effective security service for multiple device categories. They already offered a PC-based solution, provided by a third-party supplier and marketed as the Super Safe Boost, but given that the average TalkTalk home connects seven unique devices to the Internet a month, they realized that their customers needed a new kind of solution.

TalkTalk decided therefore to offer an alternative – a network-level security solution that simplifies operation & management (O&M) expenses while enhancing functionality. In late 2009, TalkTalk started its own research on safer broadband

A

Winners

NOV 201237 38

Huawei SIG facilitates the launch of value-added services such as parental control. Through the operator’s portal, parents can subscribe to or cancel service plans, and configure their online policy at will.

connections, and its efforts in this area have not ceased. In early 2010, TalkTalk partnered with Huawei to jointly develop a solution that provides safer broadband access for homes, with parental control as the key element.

Huawei SIG

Huawei provided its Service Intell igence Gateway (SIG) solution, which can be deployed on a fixed (between the broadband remote access server and international gateway), mobile (at the Gi, Pi, or ASN-GW egress), or converged network. Its architecture is simple, consisting of a front end, back end, upgrade center, and cloud security center.

The front end is responsible for analysis, reporting, and policy enforcement, while the back end manages SIG systems, users, and policies. The back end automatically receives the latest knowledge base and URL classification statistics from the upgrade center and cloud security center, without service interruption, while providing SOAP (Simple Object Access Protocol) interfaces to enable/disable services and configure policies. Based on its interfaces, service providers can develop self-service portals by themselves or through Huawei, while operators can use the SIG to deliver AoS (Alert of Security) messages to customers.

With its carrier-class router platform, Huawei SIG performance is assured through its ASIC

and multi-core network processors – service throughput can reach 120Gbps on fixed networks and 100Gbps for mobile. Reliability is another key feature, thanks to redundancy in SIG’s design for boards and key components, both on the front end and the back. The system is also equipped with professional-grade bypass devices, to protect links against anomalies. During upgrade, operators need only replace the interface or service board (overhaul is unnecessary).

Huawei’s SIG solution facilitates the launch of value-added services such as parental control. Through the operator’s portal, parents can subscribe to or cancel their service plans, and enable/disable/configure their online policy at will. Parents can also restrict access to online gaming and social networking sites at specified times of the day, helping to keep distractions during homework time to a more manageable level.

SIG boasts a library of over 65 million URLs in 43 categories, which operators can customize as required. Based on an industry-leading malicious code detection technology, SIG can filter malicious URLs dynamically, keeping viruses and other malware out of the home. If something is detected, the system can send alerts to users.

Great feedback

In May 2011, TalkTalk officially launched its HomeSafe solution (which integrates Huawei’s SIG

NOV 201237 38

platform). TalkTalk provides three primary parental control/network security functions through HomeSafe. The first is dubbed Kids Safe, and allows parents to choose websites for blocking by category, including those devoted to dating, drugs, alcohol, file sharing, gambling, gaming, and pornography; blocked websites can also be self-defined by filling the web address in a box. Homework Time allows parents to set a timeframe during which children cannot access online gaming and social networking, while the last function, Virus Alerts, blocks access to infectious websites. All of these services are free of charge to TalkTalk customers. TalkTalk additionally offers a higher-level PC-based security service, dubbed Super Safe Boost, that is offered for £2 per month or free of charge as part of a higher-tier package.

As a satisfied TalkTalk customer, Mr. Smith can now log into his account and switch on HomeSafe in about a minute. He can then be confident that his children now have far fewer opportunities for online distraction, while other family members are able to benefit from improved safety online through various measures.

Since its launch in May 2011, HomeSafe has enjoyed positive feedback from children’s charities, parents groups, and the British government. For example, Justine Roberts, co-founder of the U.K.-based Mumsnet, and the U.K. Children’s Minister Tim Loughton have expressed their appreciation of HomeSafe. Tim Loughton praised TalkTalk for leading the way when it comes to Internet safety.

Liska, a popular parent blogger, has noted that “this really is a great product and is a breath of fresh air, to what is otherwise a very confusing industry for customers: that of online security.”

HomeSafe i s now a key di f ferent iator in TalkTalk’s service lineup, having made the operator the first in Great Britain to provide network-level broadband security as well as the first to support government efforts to provide what the U.K. government calls active choice where customers are prompted to set up parental controls when signing up for broadband. It has also helped the operator win two industry awards for innovation and network security.

With a c la im to be ing the U.K.’s sa fes t broadband connection, HomeSafe is gaining increased popularity among customers. Eight weeks after launch, it attracted over 100,000 customers and since TalkTalk introduced this active choice, roughly one in three new customers has chosen to use the parental controls. Less than a year and half after launch (May 9, 2012), HomeSafe users hit over 500,000, and this number is expected to reach one million by March 2013.

In Q4 2011, TalkTalk CTO Clive Dorsman granted the operator’s Smooth Delivery Award to the Huawei SIG team, recognizing the vendor’s efforts and professionalism in delivering the key element in HomeSafe. As a partner, Huawei is ready to strengthen its cooperation with TalkTalk in broadband security, as well as other fields of mutual interest.

Winners

NOV 201239 4039

By Ma Yanzhe Editor: Xu Shenglan [email protected]

China Mobile has been a champion of LTE TDD in recent years, through efforts such as the LTE TDD service debut at the World Expo in Shanghai, its trial network in Hangzhou city, and the world’s first demonstration of seamless roaming between LTE TDD and FDD technologies, all of which will lead to a 13-city pilot rollout.

energizes the LTE TDD marketChina Mobile

NOV 201239 4040

t the 2012 Hangzhou TDD Night ceremony on June 18, 2012, senior management from China Mobile Zhejiang and China Mobile Hong

Kong successfully demonstrated roaming between the former’s LTE TDD network in Hangzhou and the latter’s LTE FDD network. Onsite services included video calling and HD VOD, featuring real-time interaction through clear, smooth images.

Li Zhengmao, Executive Vice President of China Mobile, stated his approval of this demonstration, as it proves that customers can enjoy the benefits of both LTE technologies from a single device, while also proving that LTE TDD does not play second fiddle in the LTE market.

Huawei has made significant contributions to China Mobile’s LTE TDD achievements, as the vendor’s Mobile Wi-Fi (Mi-Fi) device, the first of its type in the industry to support LTE TDD and LTE FDD inter-frequency roaming, was employed for the aforementioned demonstration, which also utilized a Huawei-constructed LTE TDD network.

Vigorous LTE TDD growth

Since 2009, China Mobile has been actively

engaged in the application of LTE TDD. At global industry summits such as the Mobile World Congress (MWC), Next-generation Mobile Networks (NGMN) Conference, ITU Exhibition, and Mobile Asia Expo, China Mobile has offered LTE TDD services for a variety of scenarios.

At the 2010 World Expo, China Mobile’s LTE TDD network dazzled international audiences with the Chinese debuts of such LTE services as mobile HD conferencing, mobile HD video surveillance, shoot-and-transmit functionality, and HD VOD.

As China Mobile’s strategic partner, Huawei played a crucial role at the expo through the first large-scale field demonstration of LTE TDD in China. Huawei independently built an LTE TDD network for the Expo Park, covering 5.28 square kilometers, which comprised 17 LTE TDD base stations, making for an intelligent, converged Evolved Packet Core (EPC) network. Moreover, Huawei was the first in the industry to launch LTE TDD Customer Premise Equipment (CPE) devices, all of which were employed at the expo.

Huawei’s competence at the expo helped convince China Mobile to let the vendor act as the exclusive supplier of LTE TDD equipment for the 16th Asian Games, which Guangzhou hosted in November 2010, where Huawei provided a full

A

Winners

NOV 201241 42

On May 16, 2012, one day before World Telecommunications and Information Society Day, China Mobile Shenzhen (Shenzhen Mobile) initiated LTE TDD operations at the Kingkey 100 tower in Shenzhen’s Luohu district. By deploying and optimizing 102 distributed indoor systems in an area of three square kilometers, Huawei assisted Shenzhen Mobile in covering a large number of the area’s major commercial buildings and residential premises, facilitating a superior user experience for its upscale users.

For the outdoors, 100 base stations were deployed at 50 sites, with station spacing averaging 269 meters (80-meter minimum). This coverage area spans official buildings, commercial centers, financial hubs, train stations, and ports, and should pave the way for smooth LTE network applications such as HD video surveillance and VOD.

LTE TDD takes off

These successful trials have greatly boosted industry and government confidence in LTE TDD. China Mobile will soon expand its pilot networks to 13 cities, with more than 20,000 base stations expected to be built.

Xi Guohua, Chairman of China Mobile, has explicitly noted that China Mobile attaches great importance to the effective utilization of TDD spectrum resources. By leveraging the advantages of TDD technology in mobile Internet application, the operator will promote the integration of LTE

E2E solution, including base stations, an EPC network, a Packet Transport Network (PTN) bearer network, and various service platforms for telepresence and video surveillance. This solution proved to be a hit, both to industry experts and the general public, as China Mobile would again select Huawei for the 2011 Universiade games, held in Shenzhen in August of that year. Thanks to the stability of the network in place, a live HD broadcast of the torch relay was available, as were a variety of other HD features.

LTE TDD commercial trials

In 2011, China Mobile officially kicked off large-scale testing of LTE TDD. It deployed trial networks in six cities, including Hangzhou and Shenzhen, and they have been well received by users, operators, the government, and the industry at large.

In March 2012, Hangzhou’s B1 bus line became the first to support LTE TDD, giving its fortunate passengers free online surfing through Wi-Fi. Presently, LTE TDD traffic on this line reaches 500GB a day, proving the service a major success with some of China’s long suffering bus passengers. In the meantime, the China Mobile Hangzhou service center has started to provide LTE TDD subscriptions to the public, where users receive a compatible device after paying a deposit, enabling them to enjoy the LTE experience throughout the city’s roughly 200 square kilometers.

These successful trials have greatly boosted industry and government confidence in LTE TDD. China Mobile will soon expand its pilot networks to 13 cities, with more than 20,000 base stations expected to be built.

NOV 201241 42

By leveraging the advantages of TDD technology in mobile Internet application, the operator will promote the integration of LTE TDD and LTE FDD. The operator is also striving to build a global industry chain so that economies of scale are achieved.

TDD and LTE FDD, and develop integrated solutions. China Mobile is also striving to build a global industry chain so that economies of scale are achieved. Mr. Xi predicts that with the concerted efforts of the Global TD-LTE Initiative (GTI) operators, the global number of LTE TDD base stations will exceed 500,000 in 2014, covering some two billion people.

However, government support is pivotal to local LTE TDD development. Top officials at China’s Ministry of Industry and Information Technology (MIIT) have spoken highly of China Mobile’s achievements in LTE TDD testing and have resolved to step up nationwide efforts in this area. The government is also working to improve the frequency distribution scheme and industry chain, while earmarking more capital for LTE TDD deployment.

As a vendor, Huawei is also confident of LTE TDD’s

prospects. Wang Tao, President of Huawei’s Wireless Network Business Unit, has asserted the company’s strategic determination in LTE TDD development. Huawei has been making consistent investments in this area, especially in its R&D, while its E2E solutions (which encompass systems, chips, and devices) have been highly recognized by the industry.

In terms of systems, Huawei SingleRAN supports platform sharing for both flavors of LTE, as well as GSM and UMTS. It has also introduced the industry’s first multi-mode dongle for LTE TDD, LTD FDD, UMTS, GSM, and CDMA, as well as the first multi-mode devices, namely CPE and Mi-Fi. The latter in particular has distinguished itself with its roaming functions, enabling a quantum leap in LTE integration and convenience, and a brighter future for LTE TDD.

Winners

NOV 201243 44

By Yu Xiangyang Editor: Michael [email protected]

At ten months after its launch, the SoftBank group’s LTE TDD/AXGP (LTE TDD) network attracted more than 260,000 customers, and this number will continue to grow, thanks to its expanding network coverage and the introduction of multi-mode data cards.

LTE TDD network impresses in JapanSoftBank’s

NOV 201243 44

obile data traffic is expected to increase eighteen fold over the next five years, representing a compound annual growth rate (CAGR) of 78%.

Yoshioki Chika, CTO of Wireless City Planning, a member of the SoftBank group (SoftBank), has stated that the data traffic over the Japanese operator’s mobile network has been doubling each year and will increase 32 fold over the same period (65% of its ARPU stemmed from data services in 2011, among the highest percentages in the world).

This increase in data services is creating a need for spectrum, which LTE TDD can meet for the next decade, not only in Japan but globally as well. At the Mobile World Congress 2012, China Mobile confirmed that it will have over 20,000 LTE TDD base stations in operation by the end of 2012. In India, Bharti Airtel is launching LTE services in four telecom circles. In Japan, SoftBank’s LTE TDD service went online commercially in November 2011, and the network is expected to cover 100% of the population of 12 major cities by 2013, making the operator a model for others to follow.

Consolidated leadership After SoftBank’s 2006 acquisition of Vodafone

Japan, its mobile customers doubled over the next five years to 30 million by November 2011. In 2010, its 3G penetration passed 100%, far ahead of the global average of 22%. In the same year, SoftBank took aboard WILLCOM, a Personal Handy-phone System (PHS) operator with TDD spectrum & site resources, and promptly founded Wireless City Planning (WCP) by reorganizing the team that had been developing the eXtended Global Platform (XGP) network at WILLCOM. WCP took over the development of XGP and upgraded it to Advanced eXtended Global Platform (AXGP), which conforms to the LTE TDD standard.

With WILLCOM now under the SoftBank flag, the operator had the site resources and the spectrum to move ahead. WCP then assigned WILLCOM’s 1.9GHz spectrum to its PHS service, with 1.5GHz/2.1GHz assigned to 3G and 2.6GHz (30MHz) assigned to LTE TDD.

According to SoftBank CEO Masayoshi Son, LTE TDD has two unique advantages – asymmetric uplink/downlink and abundant spectrum resources, which he believes can fully meet the needs of mobile Internet service and enhance user experience for the foreseeable future.

Tokyo: As crowded as it gets

MTokyo Shiodome building, headquarters of SoftBank

Winners

NOV 201245 46

To k yo , Na g oy a , a n d Os a k a h a ve b e e n the starting points for SoftBank’s LTE TDD network. As a megacity in one of the world’s most demanding mobile markets, Tokyo’s wireless communications environment is both extremely dense and extremely complex. Many of its residents are accustomed to web surfing, online video, and online gaming on the go; all require high network throughput and access success rates.

SoftBank plans to deploy 50 to 100 base stations per square kilometer, with a site spacing of 100 to 150 meters in certain areas of Tokyo. In a city where a hotel room might be scarcely bigger than a telephone booth, the CAPEX involved in this sort of density will give the bean counters sleepless nights. However, if uptake is sufficient, all will be forgiven, and SoftBank will be able to replicate this process in other regions.

SoftBank grouped its coverage scenarios into three classes – dense urban areas that will use distributed base stations with four transmitters and four receivers (4T4R) for seamless coverage; hotspots such as shopping malls and other centers of gravity that may adopt picoRRU for network access; and suburban and rural areas that need not require such elaborate planning.

Joint innovations

Joint innovation efforts have been taking place between Softbank and Huawei with the aim of simplifying network deployment; Single Frequency Network (SFN) and Intelligent Baseband Array (IBA) have been among the fruit.

The latter is scalable (supporting the interaction of dozens of BBUs), coordinated (enhancing base station-cell coordination, reducing interference, and increasing the gain for both transmission & reception), and reliable (supporting mutual backup of baseband data), leading to spectrum efficiency enhancements of up to 30%, while the SFN technology effectively inhibits inter-cell interference; users can enjoy 38.7% faster Internet speed at cell edges.

User experience has also been enhanced thanks to the 4T4R and beamforming technologies, with the latter changing array directionality to ensure optimal signaling. SoftBank has also used antenna sharing and reused all of its existing 1.9GHz PHS sites to accelerate network deployment.

Before its commercial launch, SoftBank’s network performance tests were quite impressive. The average network entry and inter-cell handover success rate exceeded 98.8% and 99%, respectively, while the packet loss rate was below 0.25%. In the Ginza district of Tokyo (that neon-lit shopping district that finds its way into pretty much every travelogue or Hollywood movie set in Tokyo), an

Before its commercial launch, SoftBank’s network performance tests were quite impressive. The average network entry and inter-cell handover success rate exceeded 98.8% and 99%, respectively, while the packet loss rate was below 0.25%.

NOV 201245 46

interior user could enjoy downlink/uplink rates of 11Mbps/5Mbps, respectively; while 60Mbps could be enjoyed near a window and up to 58Mbps (30Mbps average) could be achieved outdoors. All these figures greatly strengthened the operator’s confidence.

Enhanced terminals & services

On February 24, 2012, SoftBank officially launched LTE TDD services in its three target cities. The operator evaluated the UMTS and LTE TDD networks at Ginza, and the results were impressive; LTE TDD delivered nearly ten times the speed (34.13Mbps) that UMTS did, and service handover between LTE TDD base stations was smooth.

Mr. Son was also further convinced that LTE TDD could help achieve Softbank’s strategic goal and its rollout pace could be sped up.

SoftBank had enjoyed exclusive distributions rights for the iPhone until October 2011, but as a lot of users around the world found out the hard way, the iPhone did not yet support LTE. SoftBank’s first commercial LTE TDD Mobile Wi-Fi terminal uses the category-3 chipset, which

delivers a downlink rate of 76Mbps and uplink rate of 10Mbps, while supporting simultaneous LTE TDD access for up to ten Wi-Fi devices. In May 2012, the operator launched another LTE terminal based on the category-4 chipset. In addition, SoftBank launched a number of LTE TDD smartphones in Q3 of this year.

SoftBank has used an LTE TDD tariff plan similar to its 3G plan – users can enjoy faster services for almost the same pricing, with a monthly package running JPY3,880 (USD50). Each user’s data cap is 5GB, with the network speed reduced to 128Kbps until the next billing month if it’s exceeded. If users want their regular speed back, they must pay roughly USD33 per 2GB of traffic.

In i t s marke t ing e f fo r t s , So f tBank ha s highlighted its network as the country’s fastest, with high-speed Internet access available anywhere, anytime; ads have been sent out through customer service centers, subway screens, broadcast TV, and other channels; the operator also markets through service centers, handset outlets, and home appliance stores.

Thanks to the expanded terminal and network coverage, SoftBank attracted 260,000 LTE customers by August 2012, and more can be expected as the operator strengthens its leadership in the mobile Internet landscape.

Winners

NOV 201247 48

By Zhu Xiaoming, China Telecom Hangzhou Editor: Joyce Fan [email protected]

When it comes to network optimization, China Telecom Hangzhou (Hangzhou Telecom) has moved beyond the usual game of drive tests and KPIs. Through call record analysis, the operator has significantly enhanced its ability to sniff out latent issues and elusive flaws in its network coverage, leading to a troubleshooting process that is far less troublesome.

takes the drive out of testing in HangzhouChina Telecom

NOV 201247 48

The old way doesn’t cut it anymore

he traditional network optimization process i s a tedious ordeal where highly-skilled, highly-paid engineers spend their time analyzing dry key

performance indicators (KPIs), riding around in vans for hours on end, and scouring the nooks & crannies of buildings and tunnels for network bugs, as if they were high-tech exterminators. The situation was no different at China Telecom Hangzhou (Hangzhou Telecom), a branch of the Chinese incumbent located in Zhejiang’s provincial capital. The operator found that the majority of its O&M man hours and resources were being expended on routine optimization tasks, with O&M engineers optimizing based on the usual KPIs such as dropped call rates and other forms of traffic analysis, as well as user complaints.

KPI analysis for network elements (NEs) is usually based on their signaling point statistics, which neglect QoE and QoS management. If 200 out of 100,000 users experience a call drop, the call drop rate is 0.2%. If you are an optimization engineer, this might be cause for a bonus, but if you are one of those unlucky users, this might be cause for a complaint, and it may not prove terribly helpful anyway unless you have an uncommon knack for precisely remembering time, place, and circumstance.

As suming enough compla int s come in , as opposed to the mere s i lence of a lapsed subscription, a drive test (DT) may follow, but such methods are anecdotal. They also can’t simulate the conditions that occurred at the time a call failed (the signaling storm generated by a rock concert can’t be recreated at 10:00 a.m. on a Tuesday). What’s worse, more time is wasted if an engineer has to leave the van to scan for an indoor

fault, which may or may not be detected thanks to IP network opacity and traffic dynamism.

One particular Hangzhou Telecom user filed a complaint regarding poor signaling and frequent call drops at a certain housing development. During the initial DT, the project team could not contact the user and therefore could not get access to the fault site itself. Not surprisingly, the problem was not found. Therefore, the team had to make a second trip to the user’s front door. After complicated entry formalities, the team got into the user’s residence and found the problem to be coverage overlap coupled with some missing neighbors on site. The team therefore adjusted the antenna and optimized the neighboring cells – problem solved.

However, not every single-point optimization is consequence-free. To strengthen coverage for Road X near West Lake, a famous local tourist attraction, Hangzhou Telecom adjusted one sector’s azimuth for a nearby base station (BTS) and got good DT results for Road X, but this led to complaints of call drops on Road Y.

Both of these examples illustrate how time and resources can be wasted during network optimization, and what’s worse, the typical gear that a field engineer will have with him cannot anticipate ripple effects of the sort seen in the West Lake example. A network simulator could be used, but Hangzhou Telecom wouldn’t have been able to get its hands on one at the time this story began (2010). Even today, one would be bulky, expensive, and possibly inconvenient if it is not from the same vendor that provides your field tools.

In December 2010, Hangzhou Telecom decided to add a little more scientific rigor to the optimization process. The operator joined forces with Huawei to analyze its reams of call data and lump its fault incidents into certain categories, which were then modeled and incorporated into its optimization equipment

T

Winners

NOV 201249 50

To strengthen coverage for Road X, Hangzhou Telecom adjusted one sector’s azimuth and got good drive test results for Road X, but this led to complaints of call drops on Road Y.

4949

The devil is in the detailsFor certain areas, call drop rates can be very

high, with the worst offenders even reaching 100%. For such dead zones, a large number of fault records will accumulate, especially when you multiply them by the sheer number of base stations needed to cover a city of eight million such as Hangzhou.

The data in question stems from call detail records (CDRs), which contain a wealth of information to be sure, but finding the exact data that you want for a certain BTS is real “needle in a haystack” territory, and even if you do find it, you still need to know how to sew.

In l ight of the characterist ics of CDMA networking, Hangzhou Telecom’s project team opted to use time difference of arrival (TDOA) coupled with user behavior analysis as its methods for CDR-based fault location, with the latter being utilized because user responses to faults do show certain patterns – after a call is dropped, users will normally redial, and CDRs before or after a dropped call can in fact be used to help pin down a fault location.

For Hangzhou Te l ecom, a c e r t a in u se r complained about a call drop inside an office building. CDR analysis before and after the drop indicated that the redial connected to indoor cells that were different from the outdoor cells that had carried the original call. It seemed that the outdoor cells did not recognize the indoor cells as neighbors, a problem that is easily remedied across

Hangzhou’s numerous towers and high-rises.As the numbers of success fu l d iagnoses

increased, certain models were formulated for such problems (missing neighbors, coverage overlap, pilot pollution, etc.) over the course of three months. This involved network optimization experts pooling records from different CDR levels (BSC, cell, and user) and categorizing call drop patterns accordingly. This data was mapped out so that engineers could get a clear picture of what measures to take for optimization of both neighbor and coverage cells.

These models eventually became algorithms that could effectively label each dropped call with reasonable accuracy (improving the experience). They were eventually incorporated into Hangzhou’s Telecom’s network optimization gear, with KPIs improving soon after.

Statistical significance

With its customized optimization equipment in place, Hangzhou Telecom’s troubleshooting efficiency and efficacy have both improved. And what’s more, faults that were once stealthy can now be detected. Thanks to the aforementioned map, which presents all call drops at a certain site, engineers can figure out the proportion of each type of call drop, find out the root causes, and resolve them comprehensively & effectively. For example, these methods can guide antenna feeder adjustment based on overall coverage status for a

NOV 201249 50

Hangzhou Telecom’s overall call drop rate has declined from 0.24% to 0.17%, raising the operator’s overall ranking from the No. 10 to No. 3 among China Telecom Zhejiang subsidiaries.

5050

certain site, thus eliminating the aforementioned problems that can ripple out from single-point optimizations.

A certain Hangzhou Telecom BSC had a high call drop rate that could only be reduced to 0.34% using conventional optimization methods. The operator’s customized gear helped elucidate some previously hidden faults, leading to an improved drop rate of 0.21%. These elusive problems often relate to rivers or high-traffic areas such as tourist attractions or towers, and Hangzhou has plenty of all three. They might take the form of coverage overlaps, which can be difficult to detect using conventional tools; CDR analysis is a big help here. Moreover, Hangzhou Telecom engineers can now extend their analysis to the cellular level, thus

enabling a degree of fine-tuning never before enjoyed.

Such precision enables the operator to nip potential problems in the bud, before they affect VIP users. Furthermore, the time needed to sort out the problem children (spots with a 0.5% drop rate or above) is now reduced from two days to one hour, while the DT workload has dropped 70%. Hangzhou Telecom’s overall call drop rate has also declined from 0.24% to 0.17%, raising the operator’s overall ranking from the No. 10 to No. 3 among China Telecom Zhejiang subsidiaries and providing a model for other branches to follow in a climate that is only getting more competitive as China modernizes and urbanizes.

Winners

NOV 201251 52

By Li Pengcheng Editor: Xu Shenglan [email protected]

Thanks to the seamless integration of LTE TDD with its GSM/UMTS networks, the Saudi Telecom Company (STC) has substantially enhanced both its mobile broadband services and overall network efficiency, keeping the operator and its customers on the cutting edge.

brings three generations under one roofSTC

NOV 201251 52

audi Arabia has a total population of 28 million, with urbanites (who have an average age of 25) accounting for over 80%, and this percentage is still rising.

With living standards also on the way up (GDP per capita reached USD24,000 in 2011), this young consumer base is becoming increasingly demanding when it comes to communication – a challenge that extends to STC as well as its competitors.

High market penetration

According to the Saudi Communications and Information Technology Commission (CITC), at the end of 2010, Saudi Arabia had more than 51.6 million mobile subscriptions, marking a 186% mobile penetration rate, with heavy throughput per user and long busy hours to boot. In 2011, Saudi Arabia had more than 10 million MBB subscribers, with users of pure data services accounting for nearly 70%. Streaming video, P2P download, and Facebook have been the three most sought-after mobile Internet services, but all are both time- and resource-intensive, putting heavy strain on the network. Quality and stability are a must. A CITC survey in 2010 indicated that 48% of households were inclined to accelerate their Internet speed, but this is not the end of the story. Operators will need to do more than simply offer more bandwidth if they wish to improve network accessibility, video buffer times, and P2P download speeds, as users demand.

Forward with LTE TDD

STC provides mobile voice, MBB, fixed voice, fixed broadband and value-added services to more than 160 million users across ten countries from the Middle East to Southeast Asia.

Legacy networks in Saudi Arabia could fully satisfy STC’s 24 million domestic subscribers thirst for voice, SMS and Internet connection, but they lagged behind in terms of mobile Internet. A 2010 CITC survey showed that customer satisfaction with MBB in Saudi Arabia was rated at 2.72 (on a 5-point scale), with 70% of churned users yearning for higher Internet speeds and packages. With video services exploding across the Internet, LTE deployment had become a must for STC to complement the existing UMTS network. As to spectrum resources, the operator had 15MHz at 900MHz, 17MHz at 1800MHz, 15MHz at 2.1GHz, and two blocks of 40MHz and 12MHz at 2.3GHz at its disposal; the 40MHz continuous block proved ideal for LTE TDD deployment, enabling a network of great capability and efficiency.

LTE TDD development in tandem with GSM/UMTS

STC plans to combine the LTE TDD with HSPA+ to accommodate higher throughput demand, with its GSM infrastructure continuing in

S

Winners

NOV 201253 5453

With its technologies seamlessly integrated, STC has dramatically improved its MBB services, giving credibility to the name it chose for its MBB brand, QuickNet.

service for a long time to come and developing in conjunction with LTE TDD, with all technologies upgraded as needed.

After evaluating the relevant solutions in terms of overall technical strength, network performance, comprehensiveness, and ease of evolution, STC adopted Huawei’s SingleRAN solution for eastern, central and northern regions such as Dammam, Al Qasim, and Ha’il. With this solution, the operator was able to update its GSM hardware and upgrade its legacy UMTS network to HSPA+ (with four 3G carriers), all during LTE TDD installation.

Thanks to SingleRAN, STC can share sites, cabinets, and transmission resources among all three networks, while GSM+UMTS or GSM+LTE TDD networks can also share baseband units (BBUs), reducing the site space, transmission resources consumed, power consumption, and CAPEX & OPEX.

If STC ever deploys LTE FDD on 1.8GHz or 2.6GHz, only a software upgrade is needed for the BBUs, as GSM, UMTS, LTE TDD, and LTE FDD (if added) can share sites, cabinets, BBUs (where UMTS, LTE TDD, and LTE FDD networks share the main control boards), and transmission resources. In other words, the new LTE FDD network only needs a new radio frequency (RF) module, without additional hardware in the baseband, making for greatly improved deployment cost and efficiency.

As for the LTE TDD RF elements, Huawei’s Rad io Remote Uni t (RRU) f e a tu re s f ou r transmitters and four receivers (4T4R) and multi-carrier architecture, which combine to ameliorate both network capacity and coverage considerably.

Currently, STC only uses 20MHz of spectrum for its LTE TDD network, yet the maximum single-sector downlink rate exceeds 100Mbps. As users and traffic grow, the remaining spectrum can be utilized as needed for multi-carrier base stations, which will elevate network capacity by 50%.

In conjunction with SingleRAN, Huawei’s core network solution SingleEPC allows STC customers to access GSM, UMTS and LTE TDD networks simultaneously, reducing investment in the core network while improving network interoperability, while Huawei SingleOSS enables STC to effectively manage its GSM, UMTS, and LTE TDD networks concurrently, making for greatly reduced labor costs and improved overall upgrade efficiency.

Improving user experiences through data distribution

STC’s LTE TDD network is currently focused on high-traffic zones, while its UMTS covers urban and some suburban areas, handling low-volume data and voice services. Its GSM network covers the entire country and provides voice and a few low-volume data services through GPRS and EDGE. This coverage enables those with multi-mode Wi-Fi devices or USB data cards to switch between network technologies as needed.

Since its commercial launch in September 2011, STC has been aggressively expanding its LTE network to cover all major cities and high-traffic zones. With its technologies seamlessly integrated, STC has dramatically improved its MBB services, giving credibility to the name it chose for its MBB brand, QuickNet.

NOV 201253 5454

bharti airtel - · pdf fileissue 14 11/2012 starhub: a cloud is born talktalk protects...

Documents