bandwidth play pldt test

04/2012
Issue 12
TELUS & Bell
Megabits & Maple Leafs
Telenor: Fastest ever mobile
network swap in Europe
KPN International expands
the European information
superhighway to 100G
Smart: Innovatively
making Telco 2.0 a reality
It's all about success! We aim to help you hear
what operators would like to share in person,
see how industry peers succeed in the fierce
market, delve into their secret to success,
and learn from the winners in the industry.
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, Xu Ping, Cao Zhihui
Li Xuefeng, Pan Tao, Chen Yuhong, Zhou Shumin
Contributors
Zhu Guangping, Dang Wenshuan, Hou Lin
Wang Jian, Zhang Qinfa, Ella Wong, Stephan Jonge
Shi Xiaomin, Luo Zuoguo, Zhai Haipeng
Lu Xingang, Shou Lingfang
E-mail: [email protected]
Tel: +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.
Disclaimer
The 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
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For electronic version and subscription,
please visit www.huawei.com/winwin
User experience matters
According to IDC, global smartphone shipments in 2011 rocketed
61.3% from the 2010 total (which was 75.7% y/y), reaching 491.4 million
units; it is clear that smartphones are here to stay. For users, the smartphone
is nothing less than an unprecedented feat of engineering that has made
what were once the dull spaces in our lives (bus rides, airport waits, etc.)
easier to bear. For operators, smartphones have been invaluable contributors
to mobile broadband uptake. But unfortunately, for both sides, these
wondrous devices have become too much of a good thing.
Smartphones have evolved into quad-core superphones, such as Huawei’s
Ascend D quad, that are both expanding user expectations and squeezing
operators’ networks. Carriers are now facing user discontent where there was
none before, and it is getting worse. Subscribers might tolerate delayed voice
calls, but they might easily lose patience during the long wait for a picture
to load or video to buffer. Even when these media functions are smooth,
they can consume an entire data cap in a few hours to a few days.
In the MBB era, subscribers are being enticed to ask for more. But when
it comes to user experience, it’s always the human elements that matter –
speed, quality, freedom, simplicity and sharing. Operators, who usually bear
the brunt of complaints for a bad user experience, tend to view network
growth and evolution through the lens of technology. LTE network &
terminal ubiquity will certainly reduce user complaints, but neither can be
achieved overnight and both cannot guarantee a premium user experience.
Operators will need to take a more comprehensive approach, centered
on user experience, that encompasses end-to-end bandwidth integrity,
innovative business modeling, tiered tariffs, diversified terminals, and
premium customer services. In Canada, which stands in the front line
of MBB development, Bell Canada is committed to building the “best
network,” not only in terms of technology but also user experience. CTO
Stephen Howe explains that “in terms of quality, we look closely at specific
customer-centric metrics, compare ourselves to our competitors, and work
hard to ensure that we’re better.” In the same market, TELUS is expanding
its business models to bring better user experience to the home. Its CTO
Ibrahim Gedeon envisages that “in a connected home or future-friendly
home, all the devices will see each other and leverage common data space;
or they could be on the cloud.”
User experience is now the driving force for telco industry development,
which means that subscribers ultimately decide whether or not an operator
grows or dies. For any industry player, it’s the user experience that matters.
Ding Yun
CEO of Carrier Network
Business Group
04/2012
Issue 12
WHAT’S
INSIDE
Voices from Operators
01 Bell Canada: Mobility rings true
With the world’s highest smartphone
penetration rate and a population density
in the bottom 10, staying on the right side
of profitable is far from easy; Bell Canada’s
CTO sits down with WinWin to discuss
how the operator is doing just that.
05 TELUS more
TELUS combines an outsider’s aggression,
savvy and acumen with an insider’s
experience to compete & grow in a mature
market. With an LTE launch imminent,
the operator’s top tech guru shares his
insights with WinWin into what makes
TELUS work.
Perspectives
09 Beyond the specs: User experience
Users now have the final say in steering industry
development; it is vitally important that they are given the
means to quickly and easily access mobile networking. This
will drive current and future industry development, resulting
in a flourishing information age.
13 The connected possibilities of
mobile broadband
This adapted white paper discusses strategies and
concepts that will help carriers stay ubiquitous and
profitable in the mobile broadband era.
Tao of Business
19 Traffic operation: Converting data into value
Traffic operation utilizes a smart pipe to build up an information
exchange platform that aims to offer better information services
so that data traffic increases in a monetized fashion.
Winners
33 KPN Int’l expands the European
information superhighway to 100G
Coherent 100G is boosting KPN International’s
bandwidth & network stability, enhancing
customer service while staying on the cutting edge.
37 Smart: Innovatively making Telco 2.0
a reality
Despite an ARPU of four U.S. dollars
per subscriber, Philippine-carrier Smart
Communications is a global leader in service
innovation for its 46 million subscribers.
40 China Mobile Hubei:
23 VAS transformation: Vision into action
Operators must transform their VAS infrastructure, service
offerings, and business models if they wish to turn threats
from Internet and OTT providers into opportunities.
28 Second-screen: The next phase of television
The era of passive television viewing is fading as viewers
increasingly comment and interact on their second
screens. Learn how operators and vendors can profit from
this trend.
Smart operations, tangible value
Modular Internet cache has enabled Hubei Mobile
to smarten its operations through reduced &
rerouted network traffic, which has enhanced its
network speed, user experiences & subscriber base.
43 Telenor: Fastest ever mobile network
swap in Europe
Telenor and Huawei made history by completely
swapping the operator’s home-market mobile
network in record time, but it was far from easy.
The Bell-Huawei partnership
has worked well over the past
four years because Huawei
has been able to deliver the
key enabling products that
we need to grow our wireless
network at such a critical time
in our development.
— Stephen Howe, EVP & CTO of Bell Canada
1
APR 2012
VOICES
FROM OPERATORS
Canada
Mobility rings true
Canada, despite its laidback reputation, represents the front line in the struggle against the data
surge. With the world’s highest smartphone penetration rate and a population density in the
bottom ten, staying on the right side of profitable is far from easy; Bell Canada’s CTO sits down with
WinWin to discuss how the operator is doing just that.
By Julia Yao
W
hen last we spoke with Stephen Howe
(November 2008), then CTO of Bell
Mobility, the world was a very different
place. The impetus for that interview was
his company’s recent commitment to an HSPA network
launch, and today the article reads as positively quaint.
The conversation focused on roaming charges, network
sharing, and Canada’s then modest wireless penetration
rates. The word smartphone did not come up once, nor did
the various iterations of social media, data surge, signaling
storm, or pretty much any of the other issues that currently
give our readers sleepless nights. Today, Bell is already
seven months into its LTE era, and Mr. Howe (now EVP
& CTO of Bell Canada) is back to talk with us again
about where Bell has been and where it is going.
WinWin: What benefits has HSPA+ network
deployment yielded for Bell and its customers?
Howe: Our HSPA+ network has enabled Bell and
our customers to take full advantage of a truly global
ecosystem in wireless communications. Our customers
have gained access to the latest superphones, data services,
and international roaming capability, while Bell has been
able to leverage leading-edge network features and cost
advantages.
WinWin: What role did Huawei play in helping Bell
with its HSPA+ achievements?
Howe: Huawei was instrumental in delivering a
significant portion of our RAN (Radio Access Network)
with the flexibility and support that enabled us to
complete a full network overlay in less than twelve months.
WinWin: Bell is committed to delivering the “best
networks” – how would you define this in terms of
customer experience?
Howe: Bell works to deliver the best network quality,
broadest coverage and fastest possible download speeds
to our customers across Canada. Our HSPA+ network
supports speeds of up to 21Mbps as a baseline capability.
In late 2010, we introduced dual-carrier HSPA, which
now delivers up to 42Mbps to a majority of the Canadian
APR 2012
2
VOICES
FROM OPERATORS
Our HSPA+ network now covers over 1.5 million square kilometers
and 97% of the Canadian population. One key lesson so far has been that the
preparation work we executed with our initial HSPA+ implementation ensured
a very manageable program in the deployment of LTE.
population, and in September 2011, we introduced LTE,
also in partnership with Huawei, with initial speeds of
up to 75Mbps. Our HSPA+ network now covers over
1.5 million square kilometers and 97% of the Canadian
population, and we offer LTE service in 14 urban centers
– many more than our largest wireless competitor. In
terms of quality, we look closely at specific customercentric metrics, compare ourselves to our competitors,
and work hard to ensure that we’re better. One example
would be our recently-launched HD voice service that
provides crystal-clear sound quality and greatly decreased
background noise.
WinWin: Bell commenced commercial LTE
operations in September 2011. What have you learned
thus far?
Howe: One key lesson so far has been that the
preparation work we executed with our initial HSPA+
implementation ensured a very manageable program in the
deployment of LTE.
WinWin: What have you encountered that you did
not expect?
Howe: Given that we are in the early stages of global
LTE deployment, we are pleasantly surprised with the very
high level of stability of LTE infrastructure.
WinWin: What are your plans for LTE and what role
do you see Huawei playing in those plans?
Howe: Bell was recently involved in a signing ceremony
with Canadian Prime Minister Stephen Harper in which
we confirmed our partnership with Huawei on our
LTE deployment going forward. We will continue to
3
roll out LTE in additional markets in 2012, including
rural and remote locations, contingent on the Canadian
government’s decisions concerning 700MHz spectrum
availability. Huawei plays a major role in our network
expansion as our key LTE RAN supplier.
WinWin: Canada’s smartphone penetration rate is
the highest in the world. How is Bell managing with
the signaling surges that these phones create on the
network?
Howe: Bell Mobility has taken a three-pronged
approach to deal with this issue.
1. Proactive forecasting of signaling demands and
setting reasonable engineering limits so the network is
provisioned adequately to support demand.
2. Working with our vendors to develop, test,
and implement new network features that deal with
smartphone challenges more efficiently (for example, we’re
partnering with Huawei on the Enhanced Fast Dormancy
feature to reduce signaling messages).
3. Proactive verification and characterization of
smartphone application behavior. Bell has worked with
OEMs and application developers directly on optimizing
application behavior, and we will be participating in
a forum being established with Huawei and network
operators to create test procedures and actions to reduce
the unique network impacts of smartphones.
WinWin: Bell purchased CTV (Canada’s largest TV
broadcaster) and a significant interest in Maple Leaf
Sports and Entertainment (MLSE), Canada’s largest
sports and entertainment company. How does content
fit into Bell’s strategy?
APR 2012
Howe: The acquisitions of CTV and ownership stake
in MLSE (with the latter transaction expected to close
in mid-2012) support Bell’s strategy to invest in worldleading broadband networks to deliver the best content to
any screens our customers choose.
As Canada’s largest communications provider, Bell
is delivering sports, news, business and entertainment
content across traditional television with Bell TV, online
with Bell Internet, and to smartphones and tablets with
Bell Mobility. Bell has certainly taken a leadership in
Mobile TV, thanks in large part to our acquisition of
Canada’s No. 1 broadcaster and its more than 30 specialty
channels. Our interest in MLSE and its NHL, NBA and
MLS pro sports teams will also ensure access to the best
live sports content going forward.
WinWin: How has Huawei’s partnership with Bell
worked out over the past few years and what do you
expect for the future?
Howe: The Bell-Huawei partnership has worked
well over the past four years because Huawei has been
able to deliver the key enabling products that we need
to grow our wireless network at such a critical time in
our development. I anticipate that we will build on this
momentum as the wireless network evolves, and foresee
opportunities for Huawei to grow their business with Bell
in other areas of the network.
WinWin: Bell and Huawei have set up a Joint
Innovation Center. What do you hope for it to achieve?
Howe: We expect the Joint Innovation Center to bring
forward opportunities and challenges that remain unsolved
in the Bell network and the networks of other operators.
We’ll work with Huawei to define, develop, test, and
implement solutions that will help not only Bell but other
Huawei customers around the world. Bell is one of the
biggest spenders on R&D in Canada (in fact second only to
Research In Motion) and we’re excited to work with a global
leader like Huawei to move mobile innovation forward.
WinWin: What would you consider Huawei’s key
strengths in helping Bell achieve its objectives?
Howe: Huawei’s key strength is its global perspective as
a major telecom infrastructure provider, which fits Bell’s
desire to bring the world’s best technology to Canadians.
This international view enables Huawei to consider a
broad range of inputs as they make decisions to develop
product and services, and has created a strong desire in
the company to deliver technology insight and capabilities
that lead the global industry. Huawei also provides an
exceptionally talented pool of experts who understand the
importance of teamwork – qualities that are shared by our
team at Bell. It has been a very positive and productive
relationship.
Editor: Jason Patterson [email protected]
APR 2012
4
Spectrum is a resource, period. It’s a
finite resource. You can treat it with
respect and optimize it or you can abuse
it and always be lacking.
— Dr. Ibrahim Gedeon, CTO of TELUS
5
APR 2012
VOICES
FROM OPERATORS
more
Canada may account for nearly half of the North American continent, but its population is less than
the state of California; profit and ubiquity would seem mutually exclusive for a newcomer to the
national stage. Nevertheless, TELUS’s aggression, savvy and acumen have pushed it into a dead heat
with its incumbent rivals. With an LTE launch imminent, TELUS’s top tech guru shares his insights with
WinWin into what makes TELUS work.
By Jason Patterson
T
ELUS may be a top-three operator in Canada,
but its history has been that of an upstart. It has
been committed to growth since its inception,
with the numbers getting staggering since the
year 2000 (nearly USD20 billion invested in capital and
acquisitions). Recent efforts have included an aggressive
push into IPTV (314,000 customers in 2010, an 85% y/y
increase) and healthcare technology, as well as its announced
reductions (up to 60%) in roaming charges. An LTE (AWS
spectrum) launch is on the horizon, though TELUS also
plans to bid for 700MHz to better compete nationwide,
and compete it will, if only with itself, as TELUS boasts the
far-and-away most efficient spectrum utilization (80 to 90%
better than its primary competitors) in North America.
Dr. Ibrahim Gedeon has a network software and design
background. He has held key roles in the IEEE and twice been
named to Global Telecoms Business magazine’s top-100 list of the
most influential people in the industry. He is currently CTO at
TELUS and recently sat down with WinWin to discuss where
TELUS has been and where it is going.
Learning from the past
WinWin: Since the year 2000, TELUS has grown
from a regional operator to a top-3 telco in Canada.
Courtesy of A-Frame Inc.
APR 2012
6
VOICES
FROM OPERATORS
How would you describe this journey?
Gedeon: TELUS is four regional companies coming
together; three in western Canada and one in northern Quebec.
We have a national plate to offer. The acquisition of Clearnet
(a Toronto-based operator) enabled us to offer national
coverage. Really, the positions of No. 1, No. 2, and No. 3 are
plus or minus ten percent on any given day. So, I would say
that it is a three-horse race for the top spot in wireless. We are
the incumbent in western Canada and northern Quebec for
wireline. So, I think our growth is matching the Canadian
appetite for bandwidth, value-added service, and in particular
what we call “future-friendly services.”
WinWin: How would you characterize the impact
of wireless on TELUS? Specifically, TELUS’s shift
to UMTS (2008). How has the decision impacted
Canadian consumers?
Gedeon: I believe that, at a high level, it normalized
technology. So, the top 3 carriers, at 95% market share,
now have more or less the same protocols. It’s been a
great thing for us. I believe that we did it at the right time
and the shift has actually seen unparalleled growth in the
access to the global ecosystem of HSPA+. In the old days,
CDMA was very North American and LTE is still in its
infancy. HSPA+ allows us to have a mature ecosystem.
WinWin: Network traffic has changed considerably
during the 3G era. For instance, 80 percent of wireless
traffic is still active at night, how does this affect your
network?
Gedeon: Actually, that’s interesting. In the old days the
paradigm was “mobility is a business service,” “wireless is
a business service.” That’s not the case now. It’s definitely a
consumer service and it’s an always-on service. Dealing with
it at night, per se, does not really impact us as we design for
trends. Whether it’s applied or modeled, it doesn’t really matter;
it’s a design issue. But, there are little things that are emerging.
In the old days, you would design for coverage on the highway,
but now you design for coverage of a residential place. So, I’d
say that the increase in data is helping us reshape our design
parameters, our assumptions, and how we run our networks.
Moving forward
WinWin: TELUS is partnering with Bell for some
of its network infrastructure. How is that partnership
progressing, considering that Bell is also a competitor?
Gedeon: I think it’s working great. It’s a great example
of how people can leverage fixed resources… finite
resources to provide different customer experiences. So,
7
competition is alive and well, but we don’t have to compete
at all levels. So, the common infrastructure is working well
and, as you know, Huawei has been one of our partners
that has enabled a network-sharing agreement.
WinWin: How does TELUS plan to avoid a repeat of
Canada’s 2G-3G dropping and interruption when your
LTE network is launched?
Gedeon: As you know, the beauty of LTE… we have
given a lot of thought to NGMN and GSMA on it.
And circuit-switch fallback (CSFB) is one way to make
certain that the call does not fail when switching between
technologies. The session is maintained because it is the
same core, more or less… the data-call packet core… I
think that for users, because the connection times are so
fast, they are not really complaining. People are not really
complaining like they used to do in the old days. And a data
session, unlike a voice session, is kind of a real-time event
but it’s more forgiving. And there are some features that we
have deployed in our core and our access, with our partners,
to ensure seamless interworking between 3G and LTE.
WinWin: Among its many healthcare-related
solutions, TELUS offers an integrated bedside terminal
that combines healthcare, communication, and
entertainment-related features. Does TELUS plan to
offer more home media appliances in the future?
Gedeon: I think that, when we took on IP as a
transformation in 2000, we realized that a screen is a screen.
So, why should the doctor’s screen be different from the person
viewing the TV’s screen or different from the nurse looking for
the medication’s screen? So, our plan is to leverage integrated
solutions that align with our technology and services strategy.
In a connected home or future-friendly home, all the devices
will see each other and leverage common data space; or they
could be on the cloud… on the TELUS cloud. So yes, we are
planning to roll out some things, not just in the health space
but in the health & entertainment space.
WinWin: What progress is being made in the SME
space and what plans do you have for the future?
Gedeon: The SME space is tricky because everyone has
different definitions. Some people go by number; some go
by revenue per employee; some go by number of employees
in general. What we’ve realized is that we’ve done a good
job segmenting small & medium business and we realize
that traditional business services are actually needed, as are
consumer services. Small businesses now have TVs, which is
not something that was there before… now with the news
and the always-on. Everybody has a TV in the reception
area, so our plans are very simply directed-focused – touch,
APR 2012
directed-touch, and definitely leveraging our network
infrastructure partners who enable our cloud, and we are also
working on cost-effective CPE because what is happening is
that a small business with three people is now trying to get
the same look and feel as a bank with a thousand employees.
WinWin: With smartphone and tablet usage
booming, can you comment on what your users will
experience in the future?
Gedeon: One thing that’s happening with wireless and
wired bandwidth being so readily available and affordable,
people like having a mobile broadband experience. So, it’s via
Wi-Fi, via HSPA+, via LTE, via DSL, via GPON; and I think
that you have a lot of smartphones and tablets which are very
different in their own spaces. You are getting a lot of crosssubstitution in terms of devices, between the TV, the tablet, the
PC, and the smartphone. But, from our point of view, users
really wish to be connected with their applications, regardless of
where they are. So that puts a lot of pressure on our wired and
wireless networks to ensure their seamless mobility.
Bytes nipping at your heels
WinWin: The data surge that we are currently dealing
with may never end. What are TELUS’s plans to deal with it?
Gedeon: Well, we are buying from Huawei for LTE.
So, that’s one way of dealing with it. I believe there are a
lot of ways that we can have an impact. On the wireless
side, there are only so many bits per Hz that you can push,
at the end of the day. There are some clear data points
on that one. Our plans are very simple... leveraging our
fiberized cell sites and working with our partners on fixing
the signaling and capacity issues.
WinWin: Can you comment on your spectrum
efficiency? Basically, TELUS’s spectrum efficiency is No.
1 in North America; how is it that you are making this
possible?
Gedeon: Spectrum is a resource, period. It’s a finite
resource. You can treat it with respect and optimize it or you
can abuse it and always be lacking. I think a lot of our roots…
there’s a huge chunk of TELUS that started as a competitive
outsider with Clearnet; when TELUS bought Clearnet, we
became the competitive outsider. There’s a lot of efficiencies
and optimization, starting with 5GHz spectrum only; let’s do
a healthy DNA for spectrum efficiency. Today, I would say
that we are probably the best in terms of spectrum efficiency
in North America, if not the world. And there’s nothing
wrong with that; even with the new auctions coming up, the
spectrum in the usable band will always be finite.
How does Huawei fit in?
WinWin: TELUS was instrumental in bringing
Huawei to Canada. How has TELUS’s relationship with
Huawei grown since then?
Gedeon: I believe that our relationship with Huawei
started with the HSPA RAN… with the wideband CDMA
RAN. It has evolved now to broadband. We are now
looking at enterprise and content services. I would say that
the relationship has been fantastic, blossoming in the right
direction. And we have also established joint R&D centers
in Canada, which is something that both our CEOs have
asked for. So, we’re on the right track on both sides, I
would say.
WinWin: How has Huawei been able to help TELUS
and what are your expectations for the future?
Gedeon: Huawei has actually been very responsive,
from a TELUS point of view. They have applied their
innovation and R&D to solve our challenges. I would see
that as our relationship continues to grow, Huawei will
increase their level of investment in Canada for TELUS,
particularly on the hard-core R&D side, to alleviate some
of the problems such as small sites, antennas and whatnot.
WinWin: Tell us more about the joint R&D centers.
What exactly are you trying to accomplish with them?
Gedeon: There are some unique characteristics about
the traffic in Canada with the advent of smartphones…
wireless in particular. It’s very important for us to look
at the applicability for the Canadian space; in particular,
on the enterprise side, once you throw in words like
cloud services and whatnot. So, that being the case, it was
important to show our commitment to Huawei and vice
versa to the Canadian marketplace and academia and the
government by establishing these joint R&D centers.
WinWin: How does the Joint Innovation Center fit
into your plans for NextGen Wireless?
Gedeon: It’s very important when you look at NextGen
Wireless to approach it as NextGen Wireless. A lot of our
peers and competitors still go with “coverage, optimize,
capacity.” What TELUS does is realize that actually you
have to do all three at once. So as you roll out a network,
you think of coverage, you think of capacity, and you
optimize the RF. And when you do all three at the same
time, you realize that actually you are in a much better
spot than when you are doing the three in series. This is
traditionally what most telcos do.
Editor: Gao Xianrui [email protected]
APR 2012
8
Perspectives
Beyond the specs
User experience
Users now have the final say in steering industry development; it is vitally important that they are
given the means to quickly and easily access mobile networking. This will drive current and future
industry development, resulting in a flourishing information age.
9
APR 2012
Despite the current fixation on bandwidth, in the future, network
speed will no longer be measured by the bandwidth a service needs, but by the
wait time experienced by users. Zero wait time for the end user is the new
paradigm that will shape Internet development.
O
ver the past twenty years, the information
age has developed at an astonishing pace;
technological transformations and applications
have grown in both scope and variety. Today,
the exponential growth of digitized information, combined
with the skyrocketing popularity of mobile networks,
has led to a surge in the sheer volume of digital content.
Concurrently, as the digital divide has narrowed, people
around the world are now able to more freely communicate
and share information with each other.
This new digital era is marked by an important new
factor – user experience. Users now have the final say in
steering the development of the industry, so it is vitally
important that they are equipped with the means to
quickly and easily access mobile networking. This, in turn,
drives current and future industry development, which
will result in a flourishing information age.
User experience drives industry
development
In today’s world, millions of services and applications
are close at hand, enabling a 24/7 online lifestyle. While
the underlying network infrastructure is at the heart of this
ubiquitous connectivity, user experience is limited to a few
points of interface. Since user experience and the demand
for continuous service drive technological development, it
is of utmost importance that the experiences that operators
provide be optimal. The following elements best illustrate
what comprises an optimal user experience.
Zero waiting redefines network speed
In telecommunications, increases in speed are often
exponential. Rapid advances in technology have taken us
from dial-up to fiber-to-the-home (FTTH), enabling a
thousand-fold increase in bandwidth in a mere 20 years.
However, despite these extraordinary developments, people
are still clamoring for more.
Despite the current fixation on bandwidth, in the
future, network speed will no longer be measured by
the bandwidth a service needs, but by the wait time
experienced by users. Zero wait time for the end user is the
new paradigm that will shape Internet development.
Assured high-bandwidth media, including
augmented reality
The development of the Internet has witnessed the
transformation of web content from mere text, images, and
sounds into high-definition videos and other next-generation
forms of media presentation, such as 3D technologies, ultra
high-definition technologies, and augmented reality. These
vivid media will be increasingly used across various applications
such as e-commerce, social networking, and broadcast media.
Instant ubiquitous connection
It took twenty years to bring the number of fixed
Internet users to two billion, but only five years to bring
the number of mobile Internet users to one billion. Thanks
to smart terminals, users can now get online anywhere,
anytime; the mobile Internet sets users free.
Similarly, à la carte services will continue to be
provided, television programming in particular, as people
will have the ability to watch programs at any time, much
more freely than they do today.
Ergonomics enters the virtual
Input methods have evolved from the keyboard & mouse
to the touchpad to motion sensing. In other words, computer
input is now user-centric rather than machine-centric; it now
taps into human form & function. In the future, ergonomics
APR 2012
10
Perspectives
Bandwidth insufficiencies are currently the greatest hindrance to mobile
networking. Compared with fixed networking, mobile still has a long way to go in
terms of user experience, which can only improve through gigabit-level MBB.
will become even more natural, as speech, gestures, and even
emotional cues will be interpreted.
The Internet as a community
Google introduced mathematical logic to its search
services, enabling users to access the massive amounts of
information on the Internet with relative ease. However,
Google does this merely at the tool layer, which Facebook
transcends by dealing with the social nature of humanity;
by emphasizing it, Facebook addresses users’ emotional
needs to some extent while satisfying their need to share.
The Facebook phenomenon indicates that a community
experience, which Google+ is currently trying to emulate,
will be a basic feature for both consumer-oriented services
and enterprise-targeted applications.
The pursuit of a better user experience is a major driver
for telco industry development. A better user experience
equates to more speed, better quality, greater freedom,
enhanced simplicity, and easier sharing; in some ways,
these factors reflect our fundamental human nature.
Issues affecting telco development
User experience and progress in network technologies
are inextricably linked. User experience drives network
development, and network development enables user
experience. As an improved user experience coincides
with cutting-edge mobile networking, a new round of
opportunities will avail itself to the telecom industry
which, as a whole, needs to closely adhere to the following
ten principles to take full advantage.
Broadband ubiquity for the gigabit era
Bandwidth insufficiencies are currently the greatest
hindrance to mobile networking. Compared with fixed
networking, mobile still has a long way to go in terms of
11
user experience, which can only improve through gigabitlevel mobile broadband, with architectural innovations
and continuous cost reductions supporting the sustainable
development of mobile broadband services.
Intelligent optical network management with
all-optical access
In the telecom industry, copper wire, despite the
operational inefficiencies involved, has been managed
manually for over 100 years. Unfortunately, said
management is now the most expensive part of network
maintenance. As the industry begins to evolve toward
optical access, enhanced cable deployment, maintenance,
troubleshooting, fault correction and intelligent optical
network management are all core measures that can be
used to promote its development.
All-IP & all-packet
Over the past two decades, IP technologies have
developed at unprecedented speeds. Telecom networks
today are a hybrid of time-division multiplexing (TDM)
and Internet Protocol (IP), with the latter being the
inevitable trend. The telecom industry needs to further
this transformation through service migration, network
convergence, network interconnectivity, and operation and
maintenance (O&M) changes to usher in the all-packet
era.
Cloud-based data centralization & data centers
Data has replaced voice as the primary network content,
enabling data centers to replace voice switching. This
development adds new meaning to the term flattening,
which is an ongoing topic in network evolution. New
technologies, such as virtual and distributed storage as well
as parallel computing, based on cloud computing, enable
exabyte-scale computing and storage capacities.
APR 2012
Open IP networking and cloud computing have elevated the importance of
information security and privacy protection. E2E security architecture is needed to
provide security solutions applicable at both the user and enterprise level.
Open and flexible OSS/BSS
User requirements have transformed telco industry
priorities from cost efficiency to value creation, from a
closed system to an open system. Modernization and
renovation of operational and business support systems
(OSS/BSS) for value creation and an open industry
ecosystem has emerged as a high priority as it would
efficiently support product design & development,
product market entry, and value distribution in an endto-end manner. Said systems must support both à la carte
and user-designed service packaging, including bandwidth
selection, if finicky users are to truly feel in control.
Business modeling amenable to customer analysis
In the Internet age, user requirements are individualized
and dynamic. Thanks to All-IP architecture, network
automation and statistical multiplexing have been
achieved, while quality of service (QoS) assurances can
now be more dynamic. Bulk data analysis can yield
unexpected insights into both networks and users; an
operator’s business model must be able to adapt to them.
Network resilience & intelligence with
bandwidth-on-demand
Network and bandwidth management are becoming
more intelligent and resilient, which bodes well for ondemand services where users can freely select bandwidth
and services based on their own needs. In addition, the
provision of on-demand services will improve network
efficiency and utilization.
Digital media content/distribution channels
must be integrated
As digital content flourishes and networks serve as channels
on which digital media is distributed, traditional content
delivery channels have been disrupted, which represents a
tremendous strategic opportunity that can be seized through the
integration and distribution of said content in an on-demand
and cross-platform (mobile phone/PC/TV/tablet) manner.
Supply-chain integration & cloud utilization
Cloud computing has completely transformed the
business model of the IT industry. However, broadband
is a prerequisite for its deployment. Operators have
innate advantages in localized services, network assurance,
security, and trustworthiness, which they can combine
with IT application and communication capability
integration efforts to yield end-to-end ICT solutions
suitable for the enterprise market, especially small and
medium-sized businesses. This integration also allows small
enterprises to enjoy the ICT capabilities of larger ones.
Trustworthy info service to ensure cyber
security/privacy
Open IP networking and cloud computing have
elevated the importance of information security and
privacy protection. In light of this, operators need to build
end-to-end security architecture (which includes basic
architecture, data protection, application protection, and
legal compliance) to provide security solutions applicable
at both the user and enterprise level.
Although the concept of an information society
has been bandied about for years, actual informationbased development has just begun. The ongoing pursuit
of better user experiences will continuously drive the
transformation of information services. Therefore, the
development of telecom networks and technologies will
also enter a new development phase. The combination of
both user experience and network technology optimization
will undoubtedly drive information service synergy and
promote new applications & technologies.
Editor: Jason Patterson [email protected]
APR 2012
12
Perspectives
The connected possibilities of
mobile broadband
The following article has been adapted from a Huawei-authored white paper that outlines the current state of the
ICT industry and summarizes how operators can keep their heads above water.
Mobile is changing user behavior
those for desktop PCs. Mobile Internet usage is expected to
overtake desktop Internet usage by 2014.
C
“The future is already here – it’s just not evenly
distributed”
– William Gibson, 2003
In an increasingly upwardly and horizontally mobile
world, it is paramount that no one is left behind. Road
warriors and remote workers currently attract a lot of industry
attention, but the world will only truly be connected when
rural artisans in India and favela residents in Brazil are also
empowered.
To support this connected world, technologies will have
onsumers and their devices continuously and
dynamically adapt to their social context. The
connected world, particularly the Internet, has
significantly changed consumer behavior, and
this is only the beginning. Consumers increasingly spend
more time reading digital text than print media; e-commerce
is also growing much more rapidly than brick & mortar
sales. In Europe and North America, more than half of the
population shops online. Mobile subscribers overtook fixed
in 2002, while sales of Internet-enabled phones now exceed
Revenues (USD mil.)
2011
2016
SMS/MMS
127,181
156,284
Email/IM
22,630
51,607
Music
11,383
15,438
Games+
7,492
28,200
Images
2,725
4,559
TV and video
1,103
3,854
Mobile Internet
111,215
235,291
Portable Internet
42,493
92,252
Location-based services
1,109
4,390
Social networking
807
2,023
Mobile payments & banking
3,938
36,869
Applications store
2,477
25,504
E-publications
1,481
8,616
Total revenues
2016
336,035 2011
Fig. 1 Global mobile applications and services revenues
13
664,889
APR 2012
to be multi-purpose, multi-standard, and inclusive. A vast
web of virtual relationships and digital interactions between
people and things will require flexible, distributed broadband
technologies as the backbone with cloud infrastructure,
intelligent networking, and multiple layers of IT and support
systems binding everything together.
Near-field communications (NFC) and ad hoc
connectivity protocols, such as those laid out by Digital
Living Network Alliance (DLNA)-defined guidelines and
the High Definition Multimedia Interface (HDMI); voice
and sensory-based recognition; Unified Communications
(UC); and M2M will undoubtedly merge to revolutionize
how mobile services are offered.
Smartphones: Portals to the
connected world
New technologies first arrive in the smartphone segment,
giving these devices the industry’s most powerful hardware
footprint. Today, they have more computational power than
the largest computers did twenty years ago. Most now include
an intuitive user interface (UI), advanced multimedia, and
other Internet-friendly features; all have helped increase their
consumer appeal, making them the fastest growing segment
of the mobile phone market.
More than 700 million consumers currently enjoy the use
of a smartphone, and this is only the beginning. While it took
a decade for smartphones to reach the half-billion user mark, it
Data traffic (MB mil.)
2011
2016
SMS/MMS
3,819
8,613
Email/IM
154,746
461,412
Music
134,127
1,525,170
Games+
194,350
2,342,882
Images
1,126
3,546
TV and video
272,149
5,986,223
Mobile Internet
266,069
3,562,927
Portable Internet
2,516,359
22,309,310
Location-based services
11,123
127,491
Social networking
159,969
1,510,667
Mobile payments & banking
34
296
Applications store
138,359
1,053,610
E-publications
32,796
451,046
will take only two years for it to reach one billion, with another
two years needed for the next billion; this will represent almost
40% of global mobile subscribers. With their data-centric
nature, tablets and other consumer devices will increasingly
contribute to data revenues. Tablet sales are expected to
exceed 300 million units by 2016, totaling 700 million units
overall in the hands of consumers, along with over two billion
smartphones, and some 250 million e-readers.
Mobile services/apps are changing consumers’ lives
For operators, MBB has developed in a relatively short
period of time as the second or third largest revenue stream
after voice and SMS. On a global basis, mobile Internet
revenues overtook SMS in 2011 and there is plenty more to
come. Mobile Internet end-user revenues were USD111 billion
in 2011, according to analysts, a figure that will reach USD235
billion in 2016 (Fig. 1). Mobile broadband revenues from
portable users – people using laptops or tablets – will rise at a
slightly faster rate from USD42 billion to 92 billion over the
same period. Traffic will grow exponentially, with video as a
major driver. Many operators now report that streaming video
already generates up to 50% of total traffic (Fig. 2).
MBB as a business enabler
In a connected world, traffic surges may never stop, but
not only because of consumer appetites for smart devices.
It will stem from a whole new layer of everything-everyone-
Total data traffic
2016
39,343,193
3,885,023 2011
Fig. 2 Global mobile consumer data traffic by application, 2011 and 2016
APR 2012
14
Perspectives
everywhere interactions. The term digital interaction seems
appropriate for the emerging connected world, but it must
demonstrate three core characteristics:
Ultra Broadband – A mobile network must provide
sufficient bandwidth to support any app, including HD or
3D video, without inconveniencing others. This will be the
defining challenge for mobile network capability.
Ubiquitous Connectivity – Everyone and everything
can be connected to this digital world through a ubiquitous
mobile network. It will significantly change people’s lifestyles
and their world by supporting intelligence and mobility.
Value is created as the mesh grows.
Zero Waiting – High-quality user experience and highlyefficient digital interaction will be delivered with minimal
delay. Business value will derive from the user experience.
User experience is absolutely central to the evolution of
this rapidly-evolving information age. The exchanges and
interactions enabled by ubiquitous connectivity cannot
and will not thrive if the user experience is unaddressed.
Technologies must be multi-purpose and inclusive, whatever
an individual’s place in society or location.
Mass market opportunities
We have already come a long way, but many factors remain
that will influence how the connected world takes shape and
grows. Technology clearly remains central, but there are many
political, economic, and social factors that will influence
public and private choices in technology, including the views
of infrastructure stakeholders. Some of these include:
Licensing fees – A more nurturing approach to
communications is emerging, with policymakers and
regulators growing increasingly supportive. The launch of
3G involved multibillion dollar license fees, but now and in
the future governments will accept much lower payments
for MBB spectrum as they now better appreciate the societal
benefits of ubiquitous coverage.
Mandated investments – Tech-related mandates in
areas such as smart metering and eCall (a European crash
notification service scheduled for 2015) all will create new
digital interactions and revenue streams.
Smart sustainable cities – There is growing public and
private sector interest in investing in critical infrastructure or
collaborative projects focused on building smart cities; this is
partly driven by environmental/energy-related issues.
Collaborative labor – Collaborative work methods will
strongly influence the digital world, whether through remote
work, virtual organization, or distributed work groups, or for
that matter, collaborative robots (Cobots).
A thirst for simplicity – Consumers and businesses are
hungry for the benefits of a digital world, but they want a
simplified rather than complicated lifestyle.
Service, not technology – Internet & MBB democratization
will change consumer behavior, with mobile phones and
other related devices becoming personal assistants.
Enterprise opportunities
In the connected world, the same connected devices
will probably be used to manage both our personal and
Note: April 2011 vertical markets global survey involving 182 telecom industry respondents
Source: Informa Telecoms & Media. © Informa UK Limited 2012. All rights reserved
Energy & utilities
47.3
Financial services
45.1
Health
44.5
Media/broadcast
42.9
42.3
Public sector/public safety
Transportation
39.0
22.5
Automotive
11.5
Pharmaceuticals
Others
9.9
Agriculture
7.7
0
5
10
15
20
25
30
Fig. 3 Which verticals are actively targeted?
15
APR 2012
35
40
45
50
professional lives. Consumerization of the enterprise (where
consumer technology finds legitimate uses in business) is now
a fact. Dual-role smartphones, mobile device management,
and personal clouds are part of an expanding catalog of
services now on offer to enterprises – from the very smallest
to the very largest – and their employees. Secure on-demand
access to digital enterprise assets is becoming a prerequisite,
as cloud computing disrupts traditional buying patterns
for enterprise ICT. But the shift to at-will, OPEX-driven
purchasing models is expanding the addressable enterprise
wallet share, to the benefit of operators.
Worldwide, 130 operators now offer cloud services. In
2011 alone, operators launched 170 new cloud services and
invested more than USD13 billion in cloud infrastructure,
with 250,000 square meters of data center space now under
construction to support operators’ cloud infrastructure. A
major overhaul of operators’ enterprise portfolios is underway.
Connectivity-centric service portfolios were stagnant before
MBB’s arrival. Certainly, there was a will to deliver better,
cheaper connectivity, but few revolutionary ideas about how
businesses could work smarter. Today, MBB is a catalyst on
two levels – it is reinventing existing enterprise services and
creating entirely new ones.
Vertical opportunities
Vertical industry ICT – as opposed to generic enterprise
ICT – is an exciting new frontier for operators. It involves
the creation of services customized for a particular industry,
although they may employ common applications and
technologies. According to a recent survey, 90% of operators
believe that services for connected verticals can enhance their
top-line revenues, and they are now reorganizing to target
them. Globally-connected vertical activities are legion – smart
grids, connected trains, digital oil fields, mobile health, and
mobile government, to name a few. MBB, cloud computing,
and M2M are the key technologies in play. Vertical sector
diversity (Fig. 4) is stretching operators’ technological and
go-to-market skills but is also providing an opportunity for
well-targeted enterprise services. Clever use of cross-industry
standards and platforms will be important if economies of
scale are to be achieved.
In the last two to three years, M2M has emerged as a
potential game changer for the mobile industry and will be
another driver of the connected world, most notably through
the Internet of Things – a network where the end-user may in
fact be a machine. Smart cities and smart devices offer some
of the most exciting opportunities in M2M. Transport and
utilities are two of the central tenets to the smart city concept
and both will use wireless technology. There are already 50
million smart meters in use, a figure analysts expect to grow
seven-fold by 2016. Transportation also holds huge potential
for wireless connectivity. Fleet management is an established
M2M application, but intelligent transport systems and
connected cars will, in the long run, become much larger
markets.
Most M2M applications have primarily involved
exchanges of small data amounts, albeit often in large
numbers. However, new high-bandwidth applications are
beginning to emerge, particularly where LTE is in use. In
Major regions including Western Europe and North America have already earmarked around 500-600MHz of spectrum
in the bands shown, but other markets lag behind with barely 200MHz or less.
Source: Informa Telecoms & Media. © Informa UK Limited 2012. All rights reserved
2600MHz (FDD): 15%
2300MHz (TDD): 15%
2600MHz (TDD): 14%
2100MHz (FDD): 12%
700MHz (FDD): 11%
1900MHz (TDD): 10%
800MHz (FDD): 12%
1900MHz (FDD): 1%
900MHz (FDD): 3%
1800MHz (FDD): 7%
Fig. 4 Spectrum soup: LTE connections by frequency band by 2016
APR 2012
16
Perspectives
Scandinavia, journalists have expressed interest in using LTE
for live video broadcasts as an alternative to satellite links. The
healthcare and retail sectors also hold great potential for videobased applications. The growing use and availability of highdefinition video and augmented reality also have extreme
relevance and applicability to M2M communication, even
though their initial applications lie in the consumer sector.
Innovation-enabled possibilities
Surging data traffic is placing unprecedented demands on
mobile networks. Advances in radio access technology are
already delivering increased network capacity, higher speeds,
and more efficient use of spectrum, providing an improved
user experience but also fuelling the growth cycle of ever
more sophisticated devices and data-rich applications. New
technologies will be required to enable faster, more efficient
networks as well as new revenue streams. Given the right
tools, an ultra-mobile broadband environment is achievable.
Faster and more efficient networks
Continued evolution in the RAN and traditional network
bottleneck areas such as backhaul will be accompanied by
numerous technical innovations that will further enhance
network performance, coverage and quality, such as small
cells, SONs, and cloud RAN.
LTE – By the end of 2011, 49 LTE commercial networks
were in operation, with a further 346 planned for launch
before the end of 2016.
LTE-A – Mobile operators are already discussing LTEAdvanced (LTE-A). A key reason for this is that LTEAdvanced will enable carrier aggregation – the use of discrete
parts of the spectrum. Most operators own fragmented
spectrum assets, so LTE-A can potentially make better use of
them. LTE-A is the first technology to unify spectrum across
many different bands, potentially allowing mobile broadband
without restrictions. In addition to improved peak data rate
and spectrum flexibility, LTE-A will support heterogeneous
networking and cooperative communications.
Single RAN – As operators evolve towards LTE and
beyond, a growing number are migrating to a single RAN,
enabling support of multiple radio access technologies on
a single base station platform. This will improve the cost
structure for future MBB growth and ensure continued
support for legacy technologies. A single RAN platform
enables more efficient spectrum utilization while consolidating
areas such as backhaul, helping speed All-IP migration.
Small cells – Traffic growth is not evenly distributed,
growing even faster in peak traffic areas. Spectrum has to be
re-used more intensively through cell splitting and small cell
usage; both use spectrum more efficiently. Small cells boost
17
capacity where needed, both in peak traffic areas or cell edges,
but they create a new network architecture and place new
demands on operations. By coordinating spectrum between
macro and small cells, capacity can be increased by over 100%
for each small cell added in the assigned spectrum band.
SON – Simplified installation and set-up enable quick
and easy deployment of small cells for infill coverage or target
hotspots, with self-organizing network (SON) capabilities
automatically handling everything from neighbor cell
relations to cell load management and smart handover
between the small cell and macro networks.
Cloud-RAN – Baseband processing functions for the BTS
are separated from the radio and antenna unit through the
creation of baseband pools. These can then serve hundreds of
low-cost radio cell sites that can be flexibly and strategically
deployed for optimum coverage and capacity.
Backhaul – Adequate and flexible backhaul will be crucial
to small cell success and thus an important concern for
mobile operators. Those with fiber access will benefit from its
virtually unlimited bandwidth, whereas greater flexibility can
be provided through traditional point-to-point or point-tomultipoint microwave systems.
HetNet – Diverse small-cell and macrocell architectures
that support multiple radio access technologies will be
required to address varying levels of demand and coverage
requirements, and must coexist in a heterogeneous network
(HetNet) environment, fully integrated and managed by
sophisticated radio planning. Many operators have already
embraced small cells, through their growing use of wireless
LANs and femtocells, for data traffic offload or extended
coverage. SON support in a multi-vendor small-cell
environment will be crucial in any HetNet.
Spectrum utilization – Spectral efficiency is increasing
with LTE and LTE-A, enabling operators to service more
users with the same amount of spectrum. Infrastructure
technologies, including software-upgradable base stations and
future-proof platform scan, further alleviate operator concerns
for future spectrum utilization.
New spectrum – With significant TDD spectrum
available worldwide, TD-LTE is rapidly gaining ground
on FDD; it will represent as much as 40% of the global
addressable market for LTE by 2016. However, frequency
allocation is fragmented (Fig. 4). Without convergence,
mobile operators, network equipment vendors, and device
vendors cannot achieve economies of scale to stimulate and
support grassroots network usage. Spectrum fragmentation
and shortages will add to technology costs, while the dream
of global roaming will remain elusive if spectrum is not
harmonized.
Multi-band devices – Device manufacturers must
address the proliferation of LTE spectrum bands. As the
technology matures and operators clarify their target bands,
APR 2012
device vendors can more easily support additional bands. As
MIMO matures, adaptively tuneable antennas will facilitate
multi-band integration into small form-factor devices such
as mobile phones, with an optimal number of perhaps eight
bands for an LTE device to ensure global roaming.
Revenue through operational excellence
As operators deploy faster and denser networks, their need
for new revenue streams is becoming critical. Operators must
also seek ways to monetize existing networks and spectrum
more efficiently through next-generation access technologies
that exploit faster computing platforms.
Current technologies that increase revenue can be
segmented into two main categories – technologies for new
revenue and technologies for better monetization of existing
infrastructure.
PCC – In the core network, operators can use policybased management (through the Policy Charging and
Rules Function – PCRF) to create new pricing plans based
on services or tiers. Social media bundles are particularly
interesting, as operators can monetize occasional or lowARPU data users by offering them unlimited access to these
services at a low cost; more traditional tiered plans may
depend on volume, time, or even speed of access.
SDPs and IMS-based services – In the service layer,
several launch technologies are available, including IMS,
Rich Communications Suite (RCS) and HD voice, which is
expected to offer higher-quality telephony. Service Delivery
Platforms (SDPs) are also widely used to power operatorbranded content portals, especially in developing markets
where operators have a very large subscriber base. SDPs are
also starting to be used to consolidate service creation and
control for multinational operators, even across continents.
API policy – Operators can attract new revenue streams
by opening APIs to third parties, primarily for enterprise
services, enabling them to become matchmakers between
Independent Software Vendors (ISVs) and enterprise
customers or SMEs and making them relevant in a market
where they were not before. This is particularly interesting
as operators hold subscriber data unavailable to any other
company in the value chain; this data can provide value
for both end users and upstream partners. Mobile operator
partnerships with OTT companies (including Skype, Spotify
and Facebook) have been very well accepted and have helped
reduce churn.
New business models – LTE networks are packet-based
and more suited towards data and web services, giving mobile
operators the advantage in the creation of new services and
partnerships, enabling them to make the best use of their own
assets and those for others; this will prove essential for success
in a changing world.
BSS/OSS – Whether it be LTE, LTE-A, or high-speed IPbased network infrastructure, all will require a new generation
of IT support systems to help foster a renewed focus on user
experience, business intelligence, and network congestion.
Management of multiple services is becoming increasingly
complicated as it involves a wide range of BSS/OSS, IT, and
network elements. Service management needs to be holistic
and carried out in an end-to-end fashion if operators are to
provide an integrated service experience. Various sources
of user data via analytical tools will also need to be joined
if operators are to manage the experience and provide a
customer-centric view of what takes place.
Cloud-based services – Full advantage must be taken of
cloud-based services. Telecoms are already building, buying,
or partnering on a massive scale in order to support cloudbased services, with 80% of investments and acquisitions
involving data-center infrastructure. Cloud services create
major opportunities to empower customers, but they depend
on both IT and telecom expertise. Network reach, control,
and complex service-management capabilities all must be
delivered if cloud services are to function. However, partnering
will remain important, with SaaS relationships playing a
strong role along with infrastructure vendors and professional
services providers. Operators’ cloud-enablement services come
in two categories – go-to-market services and operational
services; the latter uses the cloud operational model to manage
the operator’s own services. Operators can exploit the cloud
to improve their own operations; this might include cloudbased M2M service management and billing. A good mix of
all of the aforementioned strategies will help cloud services go
mainstream and empower the connected world.
Conclusions
The mobile broadband industry will create new
possibilities, dramatically improving not just quality of life but
also productivity at work. The three core characteristics of the
connected world – ultra-broadband, ubiquitous connectivity
and zero waiting – will underpin and support the emerging
mobile broadband world.
User experience is another key factor absolutely central to
this connected world, supporting customer retention and the
building of business value. However, optimal user experience
despite finite wireless resources will require both continuous
improvement processes and recognition that something that
is merely good is not good enough. Mobile broadband must
be redefined in terms of the business opportunities it creates
rather than the technology challenges it solves. In terms of
ICT transformation, technology innovation and business
model innovation will need to walk hand-in-hand.
Editor: Jason Patterson [email protected]
APR 2012
18
Tao of Business
Traffic operation
Converting data into value
Traffic operation utilizes a smart pipe to build up an information exchange platform
that aims to offer better information services so that data traffic increases in a monetized fashion.
In other words, it converts 1’s and 0’s into value.
By Luo Huiming
19
APR 2012
With the uptake of smartphones and the mobile Internet, operators are
seeing their data service traffic skyrocketing. As revenues from value-added services
based on voice communications, such as SMS and RBT, continue to decline, data
traffic is becoming the most valuable growth point for any carrier.
Key factors behind traffic
operation
G
iven the critical importance of data traffic to
operators’ revenue and success, it is imperative
that they accelerate their shift from bit pipe to
smart pipe and from voice traffic operation to
data traffic operation.
Smart pipes
A smart pipe can mobilize and optimize network
resources in an intelligent and automatic fashion, as per
differentiators such as services, content, subscribers, and
time of day. A smart pipe enhances network utilization,
reduces the cost per bit, improves subscriber experience,
and maximizes profit. With smart road charging, for
instance, tiered pricing is set up for different periods of the
day for each single road, as per road traffic status, number
of lanes, and routes between home & work; commuting
time and fares both increase for key roads at key times of
the day. Through the leverage of time expended and cost
(including fuel consumption), smart transportation can
automatically regulate routing and speed for vehicles so as
to minimize the total time expended and cost to society.
This is a dynamic process, and would be somewhat similar
for data traffic.
Information operations
As opposed to voice communication operation for
homogeneous subscriptions, traffic operation focuses more
on diversified data being funneled to individual users. But
to accomplish this, operators need to understand subscriber
interests/preferences and provide personalized information
services based on online content. This can be facilitated by
categorizing users, with each group offered one or several
types of services/content. However, this would not rule out
one subscriber falling into several different categories.
Smart pipes: Three goals
Improved subscriber experience
First of all, a smart pipe needs to make access point
name (APN) switching more convenient. WAP APNs are
used for accessing WAP-based sites, while net APNs access
Internet services. Some operators set up multiple APNs,
each for a single service category, which can hamper the
end-user experience when browsing or surfing, more so
than ever with smart terminals.
For instance, a certain high-profile smartphone allows
only two APNs – WAP APN for MMS and net APN for
Internet services. However, with net APN, subscribers
cannot access services owned by operators as a net
APN cannot upload the subscriber’s phone number for
compulsory verification; if subscribers switch to WAP
APN, they cannot access non-HTTP Internet services,
which is equally troublesome. The best remedy would be
to eliminate APNs and have operators’ networks assume
the service access and charging differentiation roles instead.
Another major cause of subscriber frowns is a lack
of transparency in network operations. One involves
applications, which often go online without the
subscriber’s awareness or permission, leading to data
quotas being reached faster than expected. Illegal plug-ins
in the applications are often the culprits here, as are game
settings that involve online updating of rankings and so
forth. Numerous applications trigger automatic clandestine
uploads; this can be countered by offering applications as a
APR 2012
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Tao of Business
While most operators do not produce content, they have an advantage
that no producer has – the pipe. Operators can utilize the operational models of
TV or Internet channels to present personalized service channels to subscribers
rather than the same content as portal websites.
subscription or by prompting the user each time an upload
is requested (though frequent prompts of this sort would
probably lead to them being ignored).
Another major area of network opacity is network
switching. Due to soaring traffic levels, most operators
have low-cost Wi-Fi for traffic offload. However, in areas
not covered by Wi-Fi, terminals may automatically switch
to 2G/3G data networking without notifying the user,
leading to costs and complaints. A user prompt or a flat rate
(regardless of the technology used) would help alleviate this
issue, but the latter would require the operator to calculate
the average cost per bit for each network technology and
choose an appropriate compromise.
based charging. WWW adaptation, among other technical
approaches, helps effectively reduce the cost-per-bit through
content compression, thus improving subscriber experience.
Enhanced network utilization
While most operators do not produce content, they
have an advantage that no producer has – the pipe.
Operators can utilize the operational models of TV or
Internet channels to present personalized service channels
to subscribers rather than the same content as portal
websites. That would be an operator niche and the most
effective way to construct an information exchange
platform, which would resemble an online library where
items are displayed in order of user preference. But for
this virtual library to be profitable, operators need to build
an information platform that accurately bridges the gap
between subscribers and content creators.
Specifically, operators need to recommend unique and
personalized services, as per different cell phone features, to
reduce the time users spend searching. For smart devices,
operators could offer applications that offer one-touch
access to preferred content and news related to it. For
subscribers wary of applications or feature phone users, they
can recommend personalized services on portal websites,
while hot content under a particular service category can be
recommended for new subscribers; this would give operators
the best shot at a favorable first impression.
Approaches to enhance network utilization include
bandwidth optimization, bandwidth-on-demand, fairusage policies, and flexible charging. With bandwidth
optimization, bandwidth is flexibly assigned by subscriber
profile and service category; bandwidth would go up for
high-value subscribers/services and be lowered for those
with lower ARPU. Bandwidth-on-demand is suitable for
subscribers who need one-off bandwidth purchases beyond
their cap, while fair-usage policies hinder freeloaders
through tiered pricing, throttling, and the like. Finally,
flexible charging involves charging less for bandwidth
during off-peak hours, which would motivate bandwidth
hogs to change their consumption habits.
Effective cost reduction
Traffic costs can be reduced through traffic optimization
and web adaptation. With the former, the end result is
more users occupying the same bandwidth; this not only
reduces latency, it also increases revenue through content-
21
Information operations:
Generating profit
While smart pipes can pave the way to network
profitability, the key to monetization lies in information
operation.
Tapping into the value of information exchange
APR 2012
Operators have been most adept at the forward charging model.
Precision marketing gives them a way into backward charging, as they shift
towards being a trade venue organizer who segments the venue into different
categories according to subscriber hobbies/preferences.
Increased revenue from CPs/SPs
Operators can also increase revenues from content
and service providers (CPs/SPs) through precision mobile
advertising, which is facilitated through analysis of the reams
of data operators have on hand concerning user behavior,
purchasing power, preferences, location, and segmentation.
Operators not only have the data but they are also much
more likely to have the facilities to make sense out of it, a
key advantage for them heading into the next decade.
New business models
Historically, operators have been most adept at the
forward charging model (charging subscribers), while
Internet service providers (ISPs) have been best suited
to backward charging (charging partners for services).
However, the aforementioned precision marketing gives
operators a way into backward charging, as their position
will shift towards being a trade venue organizer who operates
by first constructing the venue and then segmenting the
venue into different categories according to subscriber
hobbies/preferences. Targeting personalized information for
subscribers, this kind of operation distinguishes itself from
the supermarket shelf model of homogenous services.
Specifically, this would involve the personalized library
mentioned earlier, which might take the form of a web
portal customized with content and links from frequently
visited websites. Considering how slow web surfing can be
on a handset, this could prove highly lucrative.
Regarding the forward charging model, operators tend
to charge for voice services based on call duration and for
data based on traffic volume (or duration in some cases).
In other words, operators charge because they are being
inconvenienced, not because they are providing something
valuable to the user.
For backward charging, operators would cooperate with
content and application providers to provide subscribers
with diversified (valuable) information and/or content.
Operators usually have two approaches to recommending
information/advertisements. One is adding an ad link in
the content provided (after doing their own user analysis),
while the other is providing information about subscribers’
hobbies/preferences (ideally without violating privacy
policies) to CPs/SPs, who then send out the ad links.
The former method is potentially more lucrative for the
operator, who, as the pipe owner, inherently has more
information than can be provided to the CP/SP. In other
words, operators already have the advantage; they just need
to leverage it more effectively.
Editor: Pearl Zhu [email protected]
APR 2012
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Tao of Business
VAS transformation
Vision into action
Operators must transform their VAS infrastructure, service offerings, and business models if they
wish to turn threats from Internet and OTT providers into opportunities.
By Kristofer Kimbler & Mac Taylor
23
APR 2012
VAS transformation is a multi-dimensional process that exceeds
the mere basic evolution of service platforms and offerings. The lack of appropriate
business models relevant to service creation, operation, and monetization issues
leads to poor ROI and revenues from VAS platforms.
VAS transformation: Overview
Telco business transformation
I
n the mature markets, although regarded as a threat,
Internet and over-the-top (OTT) services, as well as
smartphones and tablets, are today’s main drivers of
mobile data usage/revenue. High-bandwidth M2M
services will continue to expand thanks to the cost-efficient
service delivery enabled by cloud technologies and the
proliferation of powerful MBB-connected devices. However,
operators have been connecting these services/devices to
the Internet through a ‘gigabyte pipe’ with a generous flatrate data package, which has eroded their bottom line and
enabled said players to literally invade their space.
Therefore, operators need a clear strategy to combat
these challenges and a comprehensive plan to leverage new
opportunities. This can only be achieved by rationalizing
and harmonizing network & IT infrastructure; optimizing
operations and business processes to reduce OPEX;
adopting new open business models based on partnerships
with CPs/SPs; and creating new service offerings and
applications to compensate for falling revenues from core
voice and messaging services.
Operators in emerging markets suffer from intense
internal market competition and low ARPU, but are as
yet less threatened by the OTT and Internet players. They
can learn from the mistakes made in North America,
Europe and other mature markets. They still have time to
proactively transform their businesses to take advantage of
the coming revolutions in their territories.
VAS transformation
VAS transformation is an integral part of an operator’s
business transformation. It is a multi-dimensional process
that exceeds the mere basic evolution of service platforms
and offerings; many operators in mature markets learned
this lesson the hard way. They invested in new VAS
infrastructure, including SDP, but neglected to adopt
appropriate business models relevant to service creation,
operation, and monetization issues, which has been a key
reason why ROI and revenues from VAS platforms have
not met expectations.
As a central part of their VAS transformation strategy,
operators recognize that they need to maximize revenue
from data services and content. Furthermore, they want
to drive more revenue through data service innovation
by competing in vertical markets traditionally addressed
by other industries and service providers, such as IPTV,
M2M, mobile money, mobile health, and cloud-based
ICT solutions for small-medium enterprises (SMEs).
Operator requirements for VAS
transformation
Operators in both mature and emerging markets have
a clear set of business objectives that are the basis and
justification for a VAS transformation program. Timeto-market (TTM) for new services should be reduced
as much as possible. To quickly respond to competition
and counter threats from new services, operators must
conceive, create, test, launch and market new services
and content offerings in a timely manner. Service-related
CAPEX and OPEX must also be reduced to be more in
line with competitors in the OTT and Internet space.
Service innovation is vital to continued success. Beyond
traditional telecommunication services, operators also
need to enter different vertical markets with mobile, cost-
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Tao of Business
VAS investment requires engagement beyond platforms and products. Huawei
has formulated a VAS Transformation Program to facilitate this process in terms of
service innovation, platform consolidation, operational strengths, and more.
effective counterparts of already existing services and
applications. Operators also need to increase the VAS
contribution to total ARPU, which means that service
offerings must be expanded and improved along with
adoption rates.
Finally, operators must bring data revenue more in line
with data traffic, without alienating customers. In other
words, they have to introduce services and offerings that
will help them increase revenue from mobile broadband.
Huawei VAS Transformation
Program
Program objectives
Successful VAS investment requires much deeper
engagement on the business and operational level;
provision of best-in-class service platforms and VAS
products is just not enough. Therefore, Huawei has
formulated its comprehensive VAS Transformation
Program to facilitate this process in four respects.
Service innovation – Service innovation remains a key
pain point for most operators; many have made substantial
investments in 3G and 4G networking but still offer 2G
service portfolios, while nearly all innovation in the mobile
space is coming now from OTT players and the Internet.
Operators must therefore extend their offerings through
new voice, messaging, data, and content services that will
yield a smart pipe that generates profits for years to come.
Operators also can enter vertical market segments such
as healthcare, education, security, and the automotive
industry.
Platform consolidation – To stay innovative and
differentiate, operators can only create new value for their
customers by leveraging all service and network assets,
including basic service enablers such as voice & messaging
25
and advanced ones such as mobile cloud & M2M. This
can be achieved through a horizontal SDP architecture
that aggregates and orchestrates all these VAS assets. Going
forward, migration of service platforms and other service
layer systems to the cloud will further increase flexibility
and rationalize costs.
Operational excellence – Outsourcing has been proven
to reduce OPEX and risk in the telecom field. Vendors
can host platforms/services and offer them to operators
as managed services; today the concept has been even
extended to the service operation and business planning
level, to achieve tangible gains in service revenue. This
model has been very successful and is growing more
popular in the mobile content business.
Ecosystem & business models – To date, operators
have generally been unwilling to share revenue with third
parties; this needs to change. To significantly expand their
service offerings, operators need effective partnerships
with application developers, service providers and vertical
industry experts. These market players must be given a
strong business incentive (service revenue sharing and
business intelligence sharing) to enter such partnerships.
Only then will operators be able to create a true ecosystem
that will expand and diversify their service portfolios.
Huawei cloud-based service platform
All Huawei service platforms and service solutions
are based on state-of-the-art SDP architecture and
cloud technology. They share SDP service enablers
and management capabilities, while providing unique
functionality necessary for specific service areas, such as
M2M, IPTV, or mobile broadband. This approach enables
radical reductions of CAPEX and OPEX for operators
who wish to quickly enhance their service offerings.
The cloud itself is a powerful service enabler for broad
classes of services and applications. It will certainly reshape
APR 2012
The cloud itself is a powerful service enabler for broad classes of services
and applications. It will certainly reshape operators’ IT Infrastructure in the
coming years. There is a great synergy between SDP and the cloud.
operators’ IT Infrastructure in the coming years. There is,
in fact, a great synergy between SDP and the cloud.
Huawei SDP can provide computing infrastructure
(virtualized OS with underlying computing hardware/
storage). It can also provide the necessary service enablers,
such as authentication, charging, messaging, or location
for applications & value-added services created in
the cloud. Developers can build applications through
SDP’s service creation environment/service execution
environment (SCE/SEE), without installing any tools on
their own computers, and then deploy these applications
without any specialized system administration skills. SDP
can also provide the exposure, management, orchestration,
and charging capabilities necessary for effective delivery of
cloud-based services to end users. With software deployed
online, providers rent applications to customers through
a subscription-based or pay-as-you-go model. From this
perspective, SDP can become both the front-end and
facilitator of cloud-based services.
Of course, the entire SDP architecture itself can be
deployed in the cloud as well, which makes cloud-SDP
synergy even more powerful. From this point of view,
the cloud becomes a foundation for the next generation
of SDP architecture, which, along with the cloud, will
certainly generate new added value for operators.
In the near future, other service layer systems and
platforms such as SMSC, MMSC or maybe even IMS
can be “absorbed” by the cloud to create homogenous,
highly-elastic, and cost-effective next-gen mobile service
architectures. Leading mobile operators such as Vodafone
are already working on such projects.
on its SDP and ancillary service platforms. With these
tools, operators can quickly generate new revenue while
gradually rolling out third-party services provided on their
service platforms. They can therefore secure control over
the key cornerstones of their business. A good example of
this approach comes from the Telefónica Group in Latin
America; after deployment of a group-wide SDP, they
quickly introduced an initial set of services provided by
Huawei and subsequently launched several more from
third-party application developers, with a TTM now
shortened from six months to six weeks, or even several
days in some cases.
Huawei’s segmented services have already proven
successful for numerous operators in terms of both
commercial and user value. Examples include Digital
Shopping Mall (DSM), Color Ring Back Tone (CRBT),
Mobile Newspaper (MNS), Rich Communication Suite
(RCS), Time-Shifted TV, Turbo Button, Parental Control,
eHealth, and mSecurity.
Turbo Button is probably the best example of how
a simple value-added service that leverages mobile
broadband (MBB) can both improve user experience and
generate significant revenue. It basically works just like
it sounds. Users who normally subscribe to basic data
packages and need a larger chunk of bandwidth for a
limited period of time can pay a little extra for it. It can
be thought of as bandwidth-on-demand. Users just click
the button and more bandwidth is provided instantly. This
service has proven quite successful for MegaFon (Russia),
which has earned up to USD1.6 million extra a month
through this service.
Multi-segment service innovation
E2E managed VAS services & hosting
To enable ser vice rollout and timely platform
investment monetization, Huawei has created a broad
portfolio of ready-to-deploy services and applications based
The professional service and operational models
provided by Huawei are essential for operators who are
looking to improve their operational efficiency, shorten
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For operators, the key advantage of revenue sharing is the
elimination of CAPEX related to costly and time consuming procurement, which
consequently has a drastic effect on TTM.
TTM, and reduce OPEX.
Huawei provides managed services which allow
operators to outsource both their platform and VAS
operations. Huawei also provides local service development
and customization services that allow operators to
create on-demand VAS products and enhance platform
functionality, without launching change requests and
tender processes. Professional services also include thirdparty management and business consulting, the latter
of which involves market analysis, service planning,
marketing planning, service performance evaluation, and
business process optimization.
Huawei actively supports operators in partnership
ecosystem development. Partner management services
include partner acquisition & qualification, partner
lifecycle management, application development, and
system integration support, as well as settlement &
reconciliation.
Tata is the number five operator in India, with 85
million subscribers. As a relative newcomer to the telco
industry, Tata has limited knowledge and experience in
VAS product operation and marketing. After deploying
Huawei’s SDP platform, Tata decided to outsource the
platform operation and certain business functions (partner
management & service marketing) to Huawei. Within a
year of operation, this decision proved quite efficacious.
Tata’s CP/SP network exceeded 300 members and its SDP
platform generated over USD39 million in revenue, with
over 200,000 content downloads per day.
New business models – Sharing revenue & risk
Today, operators are reluctant to incur all the risks
related to VAS product launch, while VAS vendors yearn
to share in the revenues generated by their products for
27
operators; this creates strong incentives on both sides to
assume a revenue-sharing model.
Revenue-sharing is a cornerstone of the Huawei VAS
Transformation program. For operators, its key advantage
is the elimination of CAPEX related to costly and timeconsuming procurement, which consequently has a drastic
effect on TTM. Huawei has already signed individual and
group-wide VAS revenue-sharing agreements with several
operators.
Huawei has raised the revenue-sharing model to the
next level of maturity through joint-service innovation,
market analysis, and service planning with a diverse body
of telecom operators. Huawei also provides business
consulting while revenue-sharing is in place, which
increases the value proposition of the model and makes it
much more attractive for operators since Huawei has the
superior understanding of its own line of products and
solutions.
Telefónica in Latin America and MTN in Africa have
successfully launched ring back tone (RBT) and other
VAS services on a revenue-sharing basis with Huawei,
which bears all the costs of RBT solutions (hardware/
software), system integration, and service operation. The
services have been launched across 13 and 21 countries
for Telefónica and MTN, respectively, and the model has
proven mutually beneficial, as MTN Nigeria has reached
an impressive 30 percent penetration for RBT, which
translates into millions of dollars of additional revenue per
month. Both operators are now ahead of the game in the
developing world, following a smoother path that should
enable them to better maintain their leadership when their
markets finally mature and the situation tightens. In other
words, with Huawei, they will remain leaders for the next
decade.
Editor: Joyce Fan [email protected]
APR 2012
Tao of Business
Second-screen
The next phase of television
By Mark Copas
The second-screen trend
I
BM predicts that by 2016, eight out of every ten
people will use some kind of mobile device as their
primary interface with the “world of information,
c o m m e rc e , a n d h e a l t h .” T h e e m e r g e n c e o f
smartphones and tablets is fundamentally changing
the way TV is watched. Secondary activities such as
socializing, shopping, and even online profile updating
(health, finance, political affiliation) are also being done
while the TV is on.
With a second screen (a phone, tablet or computer),
TV viewing is becoming more social and interactive.
Viewers can flood the Internet with program-related
chatter, contact content producers, or just find out more
about what is going on in front of them. You can already
see this in action today, as many teenagers watch TV
with a second screen while chatting with their friends –
multiple friends.
Grown-ups have been getting in on the action as
well. In the U.S. this year, both the Super Bowl and the
Academy Awards were major second-screen events. Other
programs – reality shows, game shows, political events –
are particularly ripe for this sort of interaction.
The rise of the second-screen experience is closely tied
to the rise of tablets and smartphones. Content owners
are also starting to seize the opportunity for this type of
interaction, as evidenced by their own first steps into this
space through Getglue, Miso, and Disney’s various efforts.
However, even these are somewhat limited. Text-based and
incompletely integrated with social networking (SNS),
they are still very rudimentary.
IPTV vendors and operators have also been very slow
to take leverage this opportunity.
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Tao of Business
Table 1. Mobile benchmarks for Western Europe (comScore MobiLens)
Smartphone User Penetration (%)
All 5 (Avg.)
UK
France
Germany
Spain
Italy
Used smartphone (any purpose)
45.2%
52.6%
41.4%
38.2%
52.5%
44.4%
Apps (not pre-installed)
39.2%
49.8%
35.2%
34.7%
43.0%
34.8%
Browser
39.2%
50.6%
37.7%
32.2%
42.0%
35.1%
Games
28.1%
35.4%
16.5%
25.9%
31.3%
32.3%
Texting
84.5%
91.8%
86.5%
80.2%
81.8%
82.1%
Music
27.5%
27.4%
24.1%
27.3%
36.2%
24.7%
SNS Site or Blog
26.4%
38.0%
23.8%
19.9%
28.9%
23.3%
Three month average ending January 2012; User age: 13+
The sheer volume of people accessing SNS contextual
data has become significant in Europe (Table 1), and it is a
safe assumption that most other regions are following suit,
if not moving faster.
All primary service providers are looking for a golden
bullet service that will significantly reduce churn. The
integration of SNS with television is that bullet.
Social networking
SNS has exploded across the globe – even as an
instrument of political change. It is a very powerful tool
for good, but it also has the potential to be an even more
powerful tool for raising revenue and creating a cohesive
personal digital network, made by me for me. The minute
the TV becomes my TV, churn is arguably reduced as the
service being delivered becomes immediately personal;
therefore creating an aura of mineness that is hard for a
competitor to penetrate.
Pete Cashmore, editor of Mashable (a key information
portal for social media services), suggests that in the
information economy our friends will become the content
curators of our information consumption, filtering movies,
books, and TV shows, and making recommendations for
our leisure time online.
According to Forrester, SNS may become more
influential in branding and relationships than corporate
websites and customer relationship management systems.
In what they call “the era of social context,” sites will start
29
to recognize your personal identity and social relationships
to deliver a more personalized and customized experience
in cyberspace.
The latest statistics from FutureScape show that young
adults are already using second-screen, irrespective of
whether television providers integrate it. Up to 50%
of Americans aged 18-24 discuss TV programs while
watching them. In a survey of 8000 respondents across
Europe, 38% discuss TV content via SNS during viewing,
including 53% of those aged 16-24. Content creators are
already creating their own interactive second-screen social
apps to help drive awareness and brand loyalty, which
means that operators need to get in the game and exploit
the revenue opportunities there before they are seized by
more nimble competitors.
TV as it should be
The idea behind second-screen service is that all things
are interlinked, not just in the home but in your social
circle as well. This represents a huge extension of the
connected home. It’s your own personal community,
digitally & physically connected.
If an author plugging her latest novel peaks your
interest, click your tablet’s onscreen link to download it.
This can extend to apps, games, music, movies, TV shows,
and anything else that relates to what you are watching.
The user interface (UI) should help you buy it in a single
click, representing a huge revenue-sharing opportunity for
APR 2012
The number of people accessing SNS contextual data has
grown significant in Europe, and it is a safe assumption that
most regions are following suit, if not moving faster. All service
providers are looking for a golden bullet service to significantly
reduce churn; SNS-television integration is that bullet.
Mark Copas, Head of Video
Solutions, CSD Global Centre of
Competence (Huawei)
operators looking to exploit impulse buyers.
The second-screen service should not only know what
you are watching, it should also understand it. So, when it
picks up in-show references to subjects such as Lady Gaga,
Emperor penguins, Late Victorian sideboards, or Usain
Bolt, it should put them up as live tags on the adjunct
screen. Clicking the tag should bring up relevant links
(Wikipedia entries, Google search results, iTunes offerings,
etc.) for the user to indulge.
The service should know what you and your friends
are watching. You can all discuss what you are watching,
or not (no self-respecting man would want the other
guys in his bowling league to know that he is watching
Desperate Housewives). If you think they’ll enjoy what
you’re watching, you can invite your friends to join you. If
you are wondering what they are watching, you can sneak
a look. And, you can all chat together while you all watch,
in real time.
What should we do?
The industry at large should start to look beyond what
the industry has deemed the low-hanging fruit. Services
such as RCS and IMS are expensive, difficult to deliver
and implement, and of dubious profitability as there are
free apps out there that can and do replace them (Skype
is a prime example of this). App integration also requires
hipness, which is not easy for the incumbents, where
the decision makers are typically over thirty years old.
Localization can also be a minefield for the multinational
operators, as what works in one country may not work in
another (think about Facebook’s rather modest traction in
Japan).
The UI needs to move away from the old way of
personalizing the web experience via Cookies and ‘recently
browsed’ lists; these are crude and unreliable. Personalizing
web content should be more related to profile, language,
profession, or interests, based on friends and preferences.
The optimal user experience should be inferred by what
you and your friends like, not by what the search engine
is paid to show you. This reflects exactly what IPTV is all
about. Operators should facilitate a user-based interface,
generated for the user, by the user, that is more my TV
than the TV.
This view is completely analogous to the IPTV idea of
My Channels and catchup TV (time shifting). Think about
integrating the two experiences for a seamless multi-visual,
multi-aural, multicultural media experience created by you
and your friends for you and your friends.
A practical solution
ZeeBox has been launched in November 2011 in the
U.K. as a free second-screen app or online URL for PC/
Mac, iPad, and iPhone, with Android soon to come. It has
been developed by the same people that developed iPlayer
for the BBC, although Zeebox is not a BBC product.
Zeebox brings together second-screen, SNS, education,
and shopping, in a single user experience.
APR 2012
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Tao of Business
The second-screen service should understand what you are watching.
When it picks up in-show references, it should put them up as live tags on the adjunct
screen. Clicking the tag should bring up relevant links for the user to indulge.
If operators wish to reduce churn and create a whole
new user community, they must look at developing
something like this for their own platforms. It completes
the multiscreen, multi-room, connected home experience
and it pulls fixed-mobile convergence (FMC) together.
It combines web, music, TV, and subscriber-generated
content completely into a single screen or across all screens
for the first time. It is truly unique in its approach.
So, what of Zeebox since its launch? Zeebox’s own
study of 4800 13-to-65-year-olds found that 57% “often
or almost always” send emails or browse social networks
while watching TV. Zeebox also reports thousands of
downloads in the U.K. (over 250,000 in the first week)
with numbers growing by one-third every day. This would
seem to indicate that users, particularly trendsetters, are
migrating to this type of multiscreen interaction in a big
way.
In January 2012, Sky, the U.K. satellite operator, took
a 10% equity stake in the company, indicating its status
as a potential game changer. Sky has also announced a
new OTT strategy in February 2012, which represents a
major threat to both the traditional British operators and
the likes of Netflix. Sky’s huge content resources, access to
premium sports, and its willingness to pay for them, along
with its telco services, including FBB and voice, can do
major damage to British Telecom (BT) and its ilk, with
other satellite operators possibly following suit in their
own markets.
If done right, this opportunity can change the game,
especially for operators who may not be able to match their
rivals in terms of hot content. Social media integration will
probably prove more of a draw across all age groups.
31
What’s in it for you?
So, why would operators want to deploy this? Assuming
subscribers already have the basic technology in house,
they can either buy the app or the operator can provide it
as part of the subscription pack. Sky provides SkyGo (an
app that enables TV viewing on a PC) in a similar fashion.
In any number of ways, this gives the operator a truly
unique, enhanced quad-play solution, or does it?
Quad-play does not just mean the ability to watch TV
or VoD on a smartphone or tablet. It infers the ability
to be fully immersed in the experience no matter the
terminal, with all services available; this should include
your social network. The key here is integration with local
SNS, not just Twitter and Facebook, so the experience can
truly be local and/or legal (in some countries).
This actually gives the operator a more diverse platform
for advertising, reference selling, impulse buying, and
single-click shopping. Operators can integrate with the
likes of Amazon and Spotify (for a fee) or they can take
a page out of Google’s playbook and have the advertiser/
supplier pay for premium visibility or prominence in the
shopping mall and/or tabs. Partnerships can also be offered
to content providers looking to promote new program
launches where related content is highlighted (backgrounds
& access to the cast of the show).
Current market analysis indicates that users are more
likely to interact via a second screen rather than the TV
itself, so operators should avoid reinventing the wheel
here. A second-screen app, combined with a multiscreen
video service, gives an operator wide scope of direct userinteraction methods, both with the user and between users.
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The minute the TV becomes my TV, churn is arguably reduced
as the service being delivered becomes immediately personal; therefore creating
an aura of mineness that is hard for a competitor to penetrate.
As we know, OTT is the biggest concern for most
operators. How do they control it without appearing
restrictive? You can try creating your own social media
hub, but even the likes of Google are having a hard time
breaking into this space (people only have so many hours
in the day and may not be inclined to maintain more than
one online identity). By embracing and integrating with
these hubs, operators can enhance their service offerings
while gaining control over the user interface to an OTT
service they would not otherwise have. This type of service
opens the door to revenue-sharing opportunities with a
variety of vendors.
Operators could integrate location-based information
with customer preferences and profiling information;
offer anonymized information with advertisers; integrate
and synchronize their own customers’ mobile phone
books with their social network and IM lists; offer billing
services that better integrate customer insight data and
promotional activities; or create social bundles that give
unlimited access to social media outside of the usual data
tariff.
The latter represents innovative thinking as it makes for
securable, predictable revenue that would not be in hand
with the standard tariff system. Of course, a large operator
could buy its own SNS, as Telefónica and SKT have done
(in fact these purchases show just how important this has
become).
Overall, these options could very well be the future of
television. Second-screen TV is here to stay and operators
should help their customers to embrace it; it really does
change the game.
Editor: Jason Patterson [email protected]
APR 2012
32
Winners
KPN International
Expanding the European
information superhighway to 100G
A leading coherent 100G commercial application has enabled KPN International to further boost its bandwidth
and network stability, serving customers even better while keeping its network on the cutting edge.
By Sun Yan
33
Editor: Michael [email protected]
APR 2012
KPN International is committed to providing users with reliable, fast
and innovative services. The leading coherent 100G commercial
application enables us to secure large bandwidth and high stability
requirements on our network and serve our customers even better.
— Jasper Snijder, Managing Director of KPN International
A
s an incumbent operator in the
Netherlands, KPN has overcome
numerous network transformation and
service launch challenges. To facilitate
popular services such as broadband, video, and
enterprise private-line services, KPN has started
its transformation to All-IP architecture and
repositioned itself as a full-service provider, which
has required a major evolution of its network
infrastructure.
KPN International is a fully-integrated business
unit of KPN responsible for sales to enterprise and
wholesale customers with international data, IP,
and communication service needs. In 2005, KPN
International (hereafter called KPN) built a 10G
backbone network covering Western Europe. Since
then, the operator has grown its network in stages,
upgrading it from 10G to 40G, and then to 100G
in 2011. KPN’s WDM backbone is now one of the
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largest in Europe, providing a wide spectrum of
services such as wavelength, international private
line, VPN (MPLS and Ethernet) and IP transit,
plus a multitude of value-added services.
Leading the market: 10G to 40G
With infrastructure migration imperative, KPN
began with transport network restructuring. In
June 2005, KPN signed an exclusive contract with
Huawei for CWDM and DWDM for the access
layer and national trunks, respectively, laying a
solid basis for broadband network operation which
enabled the operator to further engage in the
international private line, bandwidth wholesale,
and IP transit booms.
In the second half of 2005, KPN began its
Europe-wide 40 × 10G WDM backbone network
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Winners
KPN’s WDM backbone is now one of the largest in Europe,
providing a wide spectrum of services such as wavelength,
international private line, VPN (MPLS and Ethernet) and IP transit,
plus a multitude of value-added services.
rollout with Huawei as its partner. Over four
months, KPN deployed a network of 3,000 km
connecting more than twenty major European
cities, including Amsterdam, Luxembourg,
Brussels, Frankfurt, and London, making it one
of the largest WDM backbone networks of its
kind in Europe. In this context, the operator
had ample bandwidth to launch and accelerate
its international private line, international voice,
VPN, and wavelength services.
From 2006 to 2008, global IP traffic grew
explosively. Global backbone WDM traffic
increased by more than 40% annually, and slightly
faster in Europe (44%); 40G interfaces for core
routers had matured, and routers with 40G linecards were being deployed worldwide. With 40G
transmission commercially available on a limited
basis, KPN saw great potential in 40G leasing.
In September 2008, KPN secured an order for
40G service between Amsterdam and London. The
40G network, however, had to span the English
Channel, which presented an enormous challenge.
The possibilities for setting up intermediate
wavelength regeneration sites seemed remote, as
the channel averages 180 km in width.
Huawei’s diverse experience in 40G deployment
won KPN over once again. Both parties worked
to assess KPN’s networks and compare different
solutions. Finally, 40G eDQPSK technology,
with its excellent transmission capability and
compatibility with KPN’s existing infrastructure,
was finally chosen. Huawei helped KPN upgrade its
35
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sites and install 40G service boards. In only three
weeks, KPN established a stable 40G transmission
link spanning 214 km of the channel.
Promising the future: 40G to 100G
In 2010, IEEE 802.3ba, the 40G/100G
Ethernet standard, was officially released, which
helped jump-start the development of its industrial
chain; 100G applications were maturing thanks to
joint efforts between vendors and operators.
By early 2011, KPN had been serving customers
in 22 European countries through its WDM
backbone network. Service growth, however,
had led to bottlenecks, with the AmsterdamLondon link being one of the major choke points,
while users of the Amsterdam-Luxembourg link
were demanding 100G speeds to smoothen their
interactions with content providers and system
integrators. After its successful 40G rollout,
KPN expected that a 100G upgrade, based on its
platform, would also be possible, with Huawei’s
help.
Early in 2008, Huawei launched its 100G
prototypes and worked with more than ten
operators to verify 100G on live networks. In the
two years that followed, Huawei improved its 100G
solutions. When KPN foresaw that their network
would lead to bottlenecks, they started discussions
with Huawei to test the 100G solution on the
platform to increase the capacity in what were then
bottlenecked links. KPN’s networks had mixed
10G and 40G services, with greater demand on
nonlinearity resistance. In addition, their network
used both G.652 and G.655 fiber, creating CD and
PMD tolerance problems. Huawei recommended
its 100G coherent detection solution for the
upgrade.
The cooperation between both parties
culminated in a successful upgrade of the
Amsterdam-London and Amsterdam-Luxembourg
links; the former extends over 500 km, including
the aforementioned link across the English
Channel, and functions without electrical
regeneration, while the latter spans more than 600
km, including the urban fiber. Thanks to these
efforts, KPN can now call itself one of the first
operators to deploy 100G commercially.
“KPN International is committed to providing
users with reliable, fast and innovative services. The
leading coherent 100G commercial application
enables us to secure large bandwidth and high
stability requirements on our network and serve
our customers even better,” said Jasper Snijder,
Managing Director of KPN International.
“Due to Huawei’s leading WDM solutions, our
international network remains at the cutting-edge,
providing high performance to accommodate fastgrowing service demands.”
In the future, KPN is expected to continue
expansion of its ultra-broadband services through
migration of its busiest links to 100G.
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Winners
Smart
Innovatively making Telco 2.0 a reality
Despite an ARPU of four U.S. dollars per subscriber, Philippine-carrier Smart Communications spent its twentieth year (2011)
in an enviable position; they enjoyed a 50 percent share of the domestic mobile market, totaling 46 million subscribers.
By Pearl Zhu
37
Editor: Jason Patterson [email protected]
APR 2012
S
mart has innovated its way to the top in
the Philippines through a number of firsts,
including Smart Money and Smart Load.
Smart Money, which was launched in
2001, now services more than 8.5 million users.
The technology behind it would eventually power
MasterCard’s Payment Gateway, which allows
banks and telcos around the world to offer their
own versions today. Smart released Smart Load in
2003, enabling electronic airtime to replace prepaid
cards (then the staple of the developing world).
This airtime load engine now powers the 1 billion+
SMS messages that Smart’s 46 million+ subscribers
send each day.
Today, Smart is working with Huawei on
its Smart Netphone program (which earned it
a finalist slot for a 2011 TM Forum Business
Innovation Award), based on Huawei’s SDP (Service
Delivery Platform) platform, which represents
nothing less than an attempt to take Telco 2.0 from
the hype machine to the living room. Smart wants
to provide subscribers with not only services but
also advertising and e-commerce. They want to be
the facilitators of direct brand engagement with
consumers.
Internet for everyone
Smart has been able to sustain a 60 percent
EBITDA, but voice and text are no longer the
only games in town. Smart aspires to bring the
Internet to everyone, not just the young and
upwardly mobile; but this will take more than
just an inexpensive smartphone (70 percent of
its subscribers buy phones that cost less than
USD100). As most of its potential users only have
experience with a handset’s phonebook, call, and
text features, the complexities of a smartphone may
seem intimidating. All of these extra features would
be a hard sell if people lack the money to buy addons such as ringtones.
Smart needs to do more than simply answer the
question of what happens after voice and text. They
need a project where the end result is a data platform
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that is inexpensive, easy to use, and able to deliver fresh
and relevant services to the masses. This implies an
innovation platform, a foundry that would allow Smart
to test the waters, create services and find out how well
they respond to the needs of the public. That’s where
Huawei SDP comes in.
According to Alex D. Ibasco, Chief Innovation
Officer at Smart Communications, his company needs
to deepen its relationship with customers; in other
words, Smart needs to become a part of their lives.
Smart needs to become a conduit for people to access
whatever they need, whether it be a good or a service.
SDP comes in
Netphone: Cost-effective, easy-to-use,
relevant
Smart has insisted that their projects produces
something cost-effective, easy-to-use, and relevant.
Their solution has been to employ the phonebook
as a basis for creating new service relationships.
Smart wants to learn about their subscribers’
favorite brands and facilitate their interactions with
them. If a subscriber has a hankering for some fast
food, he or she might use a web browser to go to
the chain’s cavernous website and try to navigate
it to order. Smart is trying to change all that. They
want users to simply go to their phonebook, select
the restaurant and order. Of course the question is
“how would they do that?”
This is where Smart has worked with Huawei;
Huawei has provided them with SDP, an endto-end platform that enables operators to better
respond to user needs for new and innovative
services/applications. In other words, it is designed
to offer a digital shopping mall for users.
In addition, Huawei has provided a network
address book on the backend, which represents the
Netphone phonebook for each individual consumer.
A global cloud directory has also been created that
Smart can populate with individual and corporate
contact information. Hypothetically, a subscriber
could enter a friend’s name or brand name into the
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Winners
With a history of innovation over the past twenty years,
Smart’s tagline of “Smart – Simply Amazing” is clearly more than
just words. Through innovations such as the Netphone, Smart is
transforming from a telco to a business facilitator.
phonebook, and if the entry is present in the directory,
it could be added to an individual phonebook.
If a subscriber went into the phonebook and was
unable to find the fast food restaurant in question,
he or she could go to the global directory on the
SDP and enter the name; it will then be displayed
and the user will be prompted to add it. Adding it
makes it available in the phonebook, where users
can now simply say “order (name of the restaurant)”
and an attractive widget for ordering from that
restaurant will open. This process saves the trouble
of navigating an endless search browser and the
typically bottomless website of any fast food chain.
Smart also does the same with other subscriber
favorites, such as celebrities; subscribers can access
their blogs and interact with them in one deft
action. This procedure is also handy for other social
activities such as adding friends.
An eye-opener
As an experiment, Netphone proved an eye-opener
for the company. Its employees had heard the hype
about SDP, but they did not really know what SDP
could do. It was very hard to plan around it. This
project has greatly broadened Smart’s horizons. It has
enabled them to think beyond voice and text. It has
allowed the company to show its inventiveness by
creating services on non-legacy technologies such as
SMS. At this stage, Smart is already engaging Huawei
to be part of the long-term planning process.
Partnerships
When setting out into the unknown, partnership
criteria become more important than vendor
39
criteria. According to Ibasco, Smart needs partners
prepared to invest in creating what could possibly
amount to an entirely new platform; partners
that think for the long term and are prepared to
discover new things and grow along the way.
Smart and Huawei hit it off as partners. Neither
tried to adapt an all-encompassing system to local
conditions. Instead, both did things in small, agile
steps; this enabled them to adjust to the inevitable
bumps.
Sm a r t’s i n n ova t i o n a l s o d e p e n d s o n i t s
connections with the industry. Smart is a founding
member of the Wholesale Application Community
(WAC), whose platforms and widgets facilitate the
presence of other companies on the Netphone.
Smart’s aspirations are not limited to the
telecom industr y. Smart is also part of the
Philippines Long Distance Company (PLDT)
group, which includes key utilities, transportation
companies, and medical firms. These players can
offer services through the Smart platform, enabling
Smart to use its influence to reach every corner of
the Philippines.
Innovating humanity
With a history of innovation over the past
twenty years, Smart’s tagline of “Smart – Simply
Amazing” is clearly more than just words. Through
innovations such as the Netphone, Smart is
transforming from a telco to a business facilitator.
However, such change cannot be accomplished
through mere technological advancement; the
human element is involved. Smart has kept this in
mind by not merely building a better mousetrap
but by making it easier to get the cheese.
APR 2012
China Mobile Hubei
Smart operations, tangible value
Modular Internet cache has enabled China Mobile Hubei to effectively smarten its operations through reduced &
rerouted network traffic, which has enhanced its network speed, user experiences, and subscriber base.
By Wang Xuejing
Editor: Michael [email protected]
APR 2012
40
Winners
Hubei Mobile can now control and manage its networks in a
visualized manner, thus adding value to its broadband operations.
After two months of operation, Hubei Mobile saw its peak traffic
levels decrease by 30%, with customer complaints falling by 20%.
Dumb pipes leak revenue
A
s a subsidiary of the world’s largest
mobile carrier (by subscribers), the
network growth for China Mobile
Hubei (Hubei Mobile) has been robust
for many years. Its mobile network now reaches all
cities, counties, towns, rivers, roads, and railways
in central China’s Hubei province. Though Hubei
is an interior province not known for its affluence,
it has not proven immune to the effects of the
data surge, with all the network congestion and
experience degradation that it entails.
To go beyond being a mere pipe provider,
Hubei Mobile needed a data monitoring solution
that would help finance and facilitate service
expansion and value creation for its existing
networks. The operator also needed to upgrade its
legacy infrastructure and differentiate its services
and control policies. In other words, Hubei Mobile
needed to smarten up its operations.
Smartening up in Hubei
Hubei Mobile planned a network upgrade that
would enable the operator to visualize its network
at a granularity they had never before achieved
(the level of an individual user/data stream), which
would enable a level of fine tuning that could
truly be called smart. This would bring about an
intelligent and controllable network that could
promote the operator’s mobile Internet strategy,
41
add value to its pipes, and provide differentiated
services to customers. This platform would be
open and integrated, so that content providers,
application providers, and service providers could
all be utilized for the adding of network value,
which would enable Hubei Mobile to better
differentiate and increase control over its content.
The first step forward involved an in-depth
analysis of Hubei Mobile’s current network, so
that resources could be allocated more efficiently.
Huawei deep packet inspection (DPI) was utilized
at this point so that traffic flow and online user
behavior could be properly considered. Results
indicated that P2P traffic occupied 65% of the
operator’s provincial outlet capacity, with HTTP
traffic accounting for a further 25%. Clearly,
the amount of bandwidth being hogged by P2P
warranted reduction, so that web surfing, HTTP/
FTP download, instant messaging, online gaming,
and email service could be enjoyed and not
suffered. However, mere throttling of P2P traffic
would not do, as China’s consumer blogosphere
is as lively as any country’s. Service degradation
would drive current users and potential users into
the arms of competitors.
A platform was needed that would localize
popular services/content; Internet cache proved
ideal for this scenario, as it would both reduce the
network resources consumed and accelerate the
user experience. However, Internet cache is more of
a means than an end. First, Hubei Mobile needed
to determine which particular content would be
its focus. For example, based on protocol analysis,
the operator can classify its services with different
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priority levels; while speeding up the important
ones, the operator can limit the traffic speed or
volume of others.
Customizing solutions
Huawei was able to furnish Hubei Mobile with
the instruments to better assess its networks, and
the tools to improve them as needed. With Huawei,
Hubei Mobile was able to determine the number
of clicks for any video file of interest, and identify
other popular content for any site automatically.
For web browsing, unsurprisingly, Hubei
Mobile determined that most traffic in this area
was repetitive. Statistics indicated that 50% of
web surfers were accessing only 10% of the web’s
content. For video streaming/download, Hubei
Mobile found it to be accounting for 70% of
its traffic. Internet cache proved efficacious in
minimizing the resources consumed by both traffic
categories.
With Huawei’s solutions, the operator was able
to exchange storage for bandwidth. Specifically,
in addition to caching popular websites, video
streams, and files for download, policies could be
defined that would control and/or restrict certain
content or services; this led to tangible cost savings
and service enhancements.
Online gaming and instant messaging services,
which can nickel & dime an operator to death, also
required management. Hubei Mobile responded by
introducing IDC services and relevant applications
that would optimize network utilization.
Clear immediate benefits
Thanks to Huawei’s DPI and Internet caching
solutions, Hubei Mobile can now control and
manage its networks in a visualized manner, thus
adding value to its broadband operations. After
two months of operation, Hubei Mobile saw its
peak traffic levels decrease by 30%, with customer
complaints falling by 20%.
Us e r e x p e r i e n c e s h a v e a l s o i m p r o v e d .
Comprehensive testing and user surveys across at least
ten cities have revealed an increase of three-to-five
fold in average network speed, resulting in improved
browsing, streaming, and download experiences,
leading to positive word of mouth.
Ongoing progress
However, this is not the end of the story. The
data surge is showing no signs of slowing down.
Even Hubei Mobile’s new & improved network
would soon have been overwhelmed by HTTP and
P2P video traffic without further attenuation. But
fortunately, Huawei’s Internet cache solutions are
modularized, meaning that Hubei Mobile has been
able to supplement its capacity as needed.
The operator is now considering the addition
of cloud technology to its infrastructure, which
would further flatten the network and bring an
unprecedented level of resource optimization,
enabling Hubei Mobile to maintain its lead, both
locally and nationwide.
APR 2012
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Winners
Telenor
Fastest ever mobile network swap in Europe
“This is the biggest upgrade of the mobile network in Norway we have ever carried out. It will create a solid and
flexible base for further developing the services offered by the Telenor mobile network and the quality of those
services. Our aim is to provide customers with better, more innovative services across the country. This means better
in terms of capacity, speed and stability.” – Ragnar Kårhus, former CEO of Telenor Norway, November 2009.
By Luo Zuoguo
43
Editor: Jason Patterson [email protected]
APR 2012
T
elenor (Norway), a global
telecommunicator, owns the largest
market share in its home territory.
For its nationwide GSM/UMTS/
LTE network upgrade project, part of its BRAIN
(Broadband Radio Access IP network) program, it
chose Huawei, a leading telecom service provider
but then a newcomer to Northern Europe, to be
its partner, despite there being plenty of more
prestigious competitors closer to home.
Opportunity favors the
prepared mind
Northern Europe is second to none in the
telco industry, in terms of infrastructure, business
modeling, and overall expertise. Before 2009,
Huawei had certainly struggled to establish a
beachhead in the backyard of its international
rivals; many thought that the firm was wasting its
time. But, in October of that year, all that changed.
Telenor Norway had decided to replace its dual-
APR 2012
vendor radio access network infrastructure, with
Huawei being the leading candidate. It was tasked
with delivering a more robust service lineup at
reduced CAPEX and OPEX, so that Telenor could
continue to provide the best services to mobile
users. Huawei’s technical prowess (SingleRAN),
excellent ser vice deliver y capabilities, and
willingness to go the extra mile won Telenor over.
Both parties signed a six-year contract for Huawei
infrastructure and service provision.
“This is the biggest overhaul of the Norwegian
mobile network we’ve ever made, and creates a solid
foundation for further development of services
and quality of service in Telenor’s mobile network.
The main goal is to give our customers better and
more innovative services across the country. With
better, we mean capacity, speed and stability,” said
Ragnar Kårhus, former CEO of Telenor Norway.
“The selection of suppliers has been made after an
extensive tender process of negotiations. Vendors
have been assessed for technical requirements and
specifications, future plans, commercial terms and
conditions that may ensure a stable, effective and
predictable cooperation. It was a close competition
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The BRAIN RAN project represented the fastest network
implementation in European history. Roughly 600 sites were
swapped monthly over a period of ten months. Telenor and
Huawei jointly set a new benchmark for the industry.
between vendors, but ultimately it was Huawei
who emerged as the winner outright. Technical
quality, credibility in relation to the extensive
replacement of equipment, as well as commercial
conditions combined were crucial,” he added.
Signing this contract was a gamble for both
sides, as this was Huawei’s first network swap of its
kind in Northern Europe. A failure would have told
the world that Huawei was not ready to compete
with its Western rivals on their own ground, while
Telenor risked even more as Huawei was rebuilding
its home-market network and primary revenue
source.
Extreme challenges
Winning the contract was hard enough, but
now the real challenge was about to begin. The
BRAIN RAN project represented a complete swap
of Telenor Norway’s radio access network, which
was composed of 6379 GSM/UMTS co-located
physical sites and 9000 GSM/UMTS logical nodes.
Huawei had ample swap experience, but not in a
situation quite like this.
Scandinavia’s mobile networking may be
second-to-none, but not because local conditions
are especially suitable for it. Norway lies between
58° and 71°N, with over one-third of that lying
above the Arctic circle. Local temperatures can
dip to -40°C for months at a time, with weather
conditions changeable at an instant. Norway’s
45
mountains and fjords may be breathtaking, but they
are enough to give an onsite engineer nightmares.
More than 2500 sites required helicopter access,
which often involved a lot of waiting for conditions
to be right. Even if the weather was clear, the snow
often covered up landmarks and even made the
sites themselves resemble so many strange outposts
on another world.
Another hindrance to this project was
manpower. Nor thern Europe may produce
outstanding engineers, but not in great numbers.
Norway has only five million people and only
thirty telecom majors graduate every year from the
Norwegian University of Science and Technology
(NTNU), the second largest out of Norway’s eight
universities. In contrast, more than 600 engineers
were needed to deliver this project. Telenor,
Huawei, and all subcontractors, had to broaden
their horizons, with 25 nationalities eventually
coming on board.
Diligence under adversity
These challenges made both Telenor and Huawei
realize that the swap process had to be standardized,
disciplined, and factory-like. “As a production line,
we should have centralized support, control, and
clear processes to guarantee that the swap stays on
track, in an efficient manner. Meanwhile, highlydisciplined swap teams and efficient post-swap
performance optimization are key to driving a fast
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swap of high quality,” said David Tang, Huawei’s
BRAIN RAN project director. Both parties made
certain that these principles filtered down to the
subcontractors as well.
Centralized swap room provides efficient
support & control
Huawei’s Norway office was inside the Telenor
HQ building. Huawei’s BRAIN RAN project
members had originally worked one floor above
Telenor’s project office, but both parties jointly
established a sort of command center where all
relevant resources would be integrated seamlessly
and all relevant planning would be done. Telenor
then equipped this swap room with PCs, swap
hotline systems, IT infrastructure, and anything
else necessary. This room would prove efficient
in both coordination and planning, providing
technical support for all swap-related problems.
Several exclusive systems were set up to automate
and streamline the swap process; all incorporated
Huawei’s comprehensive and proven swap
procedures. All swap activities were synchronized
and monitored through a dashboard system of
sorts that could incorporate key data for every
single site and swap; this allowed any discrepancies
to be discovered immediately. “Thanks to those
applications, especially the swap room dashboard
and consistency check systems, they not only assisted
us in performing the swap efficiently, but also made
it easier for the technical team to inspect and manage
problems,” said Rocky Luo, Huawei’s Fault Manager
for the BRAIN RAN project. With the swap room
dashboard (SRD) system, 55 activities and/or indices
could be shared and monitored in real time for each
node swap. If the swap team was even five minutes
late to the work site, HQ knew almost immediately.
Through a consistent checking system, 20 key steps
and parameters could be checked and integrated
for a single site, helping to eliminate the errors that
creep up during a high-volume swap.
Procedural controls assure quality
A network swap is an all-encompassing process
that involves survey, design, logistics, onsite
engineering, optimization, and archiving. Huawei,
Telenor, and its subcontractors jointly developed
a project-level E2E SOP that integrated key
actions, milestones and lead time; this clarified the
responsibilities for each party. It also clearly defined
all activities for a site swap, including the swap
team set-out time in the morning, cell blocking,
transmission rerouting, service verification, and
alarm cleanup.
Many sites proved technically complicated,
with most of those covering important areas, so
a joint team was established to work with these
problem children. Kenth Sivertsen, a site expert
from Telenor (and Relacom), always thoroughly
explained the situation to Huawei, even onsite.
Telenor’s HQ sites proved extremely important
and extremely complicated. Telenor experts worked
APR 2012
46
Winners
Telenor now offers a “best in test” mobile network which
has strengthened its lead in Norway. Customer experience has
been elevated thanks to overall improvements in service
diversity and overall performance.
onsite together with Huawei for more than twelve
hours on them, but the swaps were accomplished
perfectly, without issue.
Implementation of procedures is certainly
important but all for naught if the swap team does
not fully understand them, as is often the case.
More than ten rounds of training sessions were held
for the Telenor swap, as team members came from
diverse backgrounds, both in terms of training and
nationality/native language. However, these efforts
proved fruitful, as quality was delivered along with
timeliness; downtime was minimized and relatively
few problems were encountered, providing a sound
basis for further optimization.
Timely post-swap optimization,
improved network performance
Swap execution is important, but so are postswap network optimization and documentation
archiving. Without them, Telenor would certainly
not have been able to deem its post-swap network
“excellent.” Both OSS KPIs and drive-tests showed
the new network to be vastly improved, with the
latter indicating that data drops and dropped calls
had decreased by 25 and 38%, respectively.
“Telenor is very impressed and happy with the
performance of Huawei. It is very good that the
project is on track. Telenor expectations for the
project have been more than fulfilled,” said RolvErik Spilling, former CTO of Telenor Norway.
“People might have had different opinions when
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problems came, especially when doing technical
troubleshooting. However, I never heard any blame
between each other when problems popped up.
We are always thinking about how to solve the
problems, not blaming anyone. People are always
smiling,” said Telenor swap room manager Age
Haland.
On October 6th, 2011, a large group gathered
in the swap center to witness a historical moment.
Suddenly, the room turned to silence and tears
started to roll as the last BRAIN RAN site went
online, culminating a successful project delivered a
remarkable seven weeks ahead of schedule, making
it the fastest mobile network implementation
in Europe’s history and enabling the delivery of
diverse services of a premium quality to Telenor’s
home market. Roughly 600 sites were swapped
each month, with an 856-site peak output, over
a period of ten months. Telenor and Huawei had
jointly set a new record and benchmark for the
industry.
With the project finished, Telenor now
offers a “best-in-test” mobile network which
has strengthened its lead in Norway. Customer
experience has been elevated thanks to overall
improvements in network performance and service
diversity, with the latter now encompassing HSPA+
data services. The project itself now serves as a new
swap benchmark in Europe. It starts a new chapter
in the cooperation between Telenor and Huawei.
Both already look forward to their next leap
forward, together.
APR 2012
APR 2012
48