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Dileep Agrawal, CEO, WorldLink: “When things don’t happen fast enough it can get frustrating.”


Dileep Agrawal, CEO, WorldLink, Nepal

If you have recently been frustrated by buffering while watching an HD video-on-demand stream, then hold that thought. For those in the less developed parts of the world, watching HD video at all, is, quite literally, something of a pipe dream.  In these countries, for those fortunate enough to be able to move past existential concerns such as food and housing, internet connectivity and bandwidth is still a mere fraction of what those in developed countries are used to. It’s a pain point of which Dileep Agrawal, chief executive of Nepalese ISP WorldLink, and a speaker at the Broadband Asia conference in May, is only too aware.

WorldLink has been serving Nepal with internet connectivity since 1995 and owns 90 per cent of the infrastructure that it uses to deliver services. This is a network consisting of Ethernet and optical fibre to both consumers and enterprise customers. ADSL however, if off the table, as the incumbent Nepal Telecom has not agreed to unbundle its network for others to use, and as such dominates that market.

Nevertheless, as of February 2012, WorldLink has a total of 22,000 customers and in addition to providing basic internet access offers VoIP, web hosting, network integration and support services which Agrawal sees as being all part and parcel of being a modern data services company. “Nowadays, it’s not just providing simple internet but providing value added,” he says. “Providing just simple internet services is a difficult job in any economy now.”

The major challenge facing WorldLink is dealing with the high prices it has to pay for backbone internet access compared to developed nations and the fact that it is land-locked that ensures that prices remain very high. As a result its customers on average pay for a relatively lowly sounding 384Kbps service. In practice WorldLink delivers a one megabit connection, consisting of 512kbs of international bandwidth and 512Kbps of local bandwidth. Agrawal admits this isn’t fantastic compared to more developed economies. “Penetration is traditionally lower [here] and the speeds are terrible,” he admits frankly.

The customer experience is boosted at least by the fact that Google has installed local caches in the country. It’s not purely for altruistic reasons though as Agrawal is quick to explain. “It’s for YouTube. [Google] wants YouTube to stream better. Its gives a better experience to get more people watching. They want advertising .” Still, he’s not complaining. “It’s nice that they have put servers in our country as our customers don’t complain to us that there’s too much buffering.”

But what about content located in other parts of the world? “Getting higher speeds [for customers] directly impacts us as we need to buy more upstream bandwidth to the internet. That’s the only limitation. And that upstream bandwidth is still not at the price levels that people buy at in Europe, America, or Singapore; any places where bandwidth is available in plenty. In major areas it would be US$ 5; we pay US$ 100.”

Worldlink buys most of its international connectivity from Indian operators Airtel and at present there’s a lack of competition to bring prices down. “It varies because there aren’t many operators selling bandwidth to Nepal, so the competition there is less,” Agrawal explains.

“We have connectivity to China but it’s not too reliable, and it’s not operational yet. So we have very few choices of who we can buy from on the Indian side, because there are very few people that have built their network up to the border of our country.”

There’s no immediate technical solution to this situation, but time and political stability will eventually enable a more competitive market to spring up. “It’s down to the political will on our side to negotiate with the government of China. We have not tried, as politically our country has not been that stable in the last few years.”

However, it’s clear that progress is being made. Where Nepal was paying US$ 300 per meg a few years ago, it’s now at US$ 110 and Agrawal believes that in five years it will be down to just US$ 5-S10, which is level at which developed countries would expect to pay now.

He’s keen to see that future pay dividends both for his company and for the prosperity of his country. “We still haven’t been able to experience the transformational benefits that have occurred in more developed economies where internet penetration is higher and the bandwidth higher”. Things are changing though, as those who are able to afford it, and those who live in coverage areas are turned on to the benefits of connectivity.

“I’ve been in the industry for 15 years now and initially it was just mail that people used. We could see people who did international business had a competitive edge and were able to close more deals. With the advent of the internet it’s given them a new edge in terms of being able to advertise and promote themselves globally.  And I’m pretty sure that with more bandwidth people will be able to access internet resources in a much better way. And once you have access that there’s a lot of educational content that you’ll be able to access and society will benefit from that.”

With ADSL blocked off by the incumbent, WorldLink has three methods of connecting up its customers, Ethernet, fibre and fixed wireless and Agrawal explains the technical reasons behind ow it makes the choice of what to roll out.

“The Ethernet service for residential customers is theoretically capable of delivering 100Mbps in the last mile, but the network is not reliable enough to deliver an enterprise grade service.  We pull fibre to the node, and from there, we pull outdoor (shielded) CAT5e cable on utility poles with outdoor switches at every 100 meters.  The switches are cascaded in series and then further branch out to extend the network into streets and lanes. A customer is connected to one of these switches using outdoor CAT5e cable.  The switches are powered using DC voltage passed through the CAT5e cable.  [However], we experience periodic cable cuts or switch and power failures, resulting in service outage.

“For enterprise customers, we pull optical fibre cable from the node to their premises.  This is more reliable as it is not dependent on any intermediate switches or power failure.  Fibre media is more reliable as well.”

WorldLink is inevitably keen to explore any means it can to reach its potential customers,  and as such, has two fixed wireless technologies in its portfolio. The Motorola Canopy for its Enterprise customers, and a lower cost device from Ubiquity Networks for home users. Neither are based on WiMAX or LTE. “Both are proprietary,” Agrawal says. “We would love to roll out WiMAX but the spectrum for that is not available.”

With the proximity to India spectrum this is a situation that’s not likely to change anytime soon due to the recent political scandals round telecoms licenses. “The stumbling blocks are surrounding India today is that people are scared of spectrum. It’s a dirty work after what happened in India. Politicians are very scared of taking any decisions on spectrum issues for fear that it might backfire on them in the future.”

This leaves WorldLink to focus on rolling out its existing technologies to other areas outside the main areas of Katmandu. “We are moving our focus to underserved , semi-rural markets where we can get some customers who are happy with the fixed wireless that we provide. Katmandu is 60 per cent of the market and rather than just focus on it we’re trying to shift outside.”

With so many challenges, Agrawal is keen to come to attend the Broadband Asia conference to meet and talk with others to explore ways to innovate out of the constrictions it faces to improve its service and grow its customer base. “I’m looking forward to understanding what the feelings around Asia for broadband growth. What works; what doesn’t work? What business models are coming in? TD-LTE is coming into the picture and we’d like to try and meet different ISPs and operators that we can collaborate with.”

Armed with first-hand knowledge of how things are going in other areas of the world, Agrawal is confident that he’ll be able to improve things for WorldLink and its customers. “It’s a very exciting time but when things don’t happen fast enough it can get frustrating.”

The Broadband Asia conference is taking place on the 15th-16th May 2012, KL Convention Centre, Kuala Lumpur, Malaysia. Go to the website now to register your interest.

telecoms.com – telecoms industry news, analysis and opinion

Hip(CEO)s don’t lie

For an industry run for the most part by grey-suited conservatives, it’s curious that the mobile sector never tires of attempts to hitch itself to trendy bandwagons driven by even trendier bands. What’s more curious however is that none of those collaborations in recent memory (the Informer’s memory hasn’t been that great since the last days of the Grateful Dead however) have amounted to much.

So on Wednesday night the market watched as T-Mobile USA CEO, John Legere, who to be fair is one of the industry’s less grey-suited and conservative execs, took to the stage with Columbian songstress Shakira to announce the carrier’s latest ‘un-carrier’ initiative.

Legere announced that T-Mo USA is cutting data roaming costs for its customers when they are travelling in more than 100 countries worldwide. He described roaming costs as “completely crazy” and “insanely inflated” before announcing that data roaming and text messages would generate no extra costs for “most” users on its Simple Choice plans. Voice calls for these users will be charged at a flat rate of $ 0.20/minute across the same geography.

In an interview demonstrating the savings that could be made, Legare made a comparison to AT&T, saying that if a customer uses 72MB of data, makes 32 one minute calls, and sends 36 text messages in a day the cost would be $ 1,150 if the person was in Canada and in Europe, the cost would jump to around $ 1,500. T-Mobile’s cost on the other hand would be $ 6.40. But what kind of typical usage is that? Unless you’re a drug dealer, who makes 32 one minute phone calls in a day?

The Informer is suspicious about Legere’s comparison but maybe he shouldn’t be. How’s that Shakira song go? “The hip don’t lie?” And Legere is certainly (relatively) hip…

“The truth is that the industry’s been charging huge fees for data roaming. But what’s most surprising is that no one’s called them out – until now.” Now that’s fighting talk and somewhat hypocritical seeing as T-Mo has been benefitting from those same “huge fees” for data roaming just as much as any of its peers. The Informer wonders what was thought of that comment back at T-Mobile global HQ in Germany, where the executive board is certainly a bit less flamboyant.

He might even have accidentally called out T-Mobile UK, which was in the local papers on Friday morning, when the Essex Chronicle ran a story about a 14 year old girl who had been able to run up a £969 phone bill on her dad’s account while talking to friends about “boy problems”. She’s certainly got 99 problems now.

Meanwhile back at the Legere gig, Shakira, known for being small and humble (so you don’t confuse her with a mountain), said that the partnership was “all about bringing the world closer together,” and allowing her “to share my music in new and innovative ways.” Oh and of course there’s a humanitarian element in collaboration with Shakira’s primary charity, The Barefoot Foundation, which helps to build schools for communities in Latin America.

Does this partnership explain why T-Mo USA borrowed $ 5.6bn in bonds from its parent company the same day? Perhaps Shakira’s rider is much bigger than she is? We’ll see how this one goes but really, when hasn’t a mobile/singer tie up almost been the kiss of death for the telecoms player in question?

Only last month the collaboration between rapper turned entrepreneur Dr Dre and HTC collapsed as the pair found out that the Beats don’t go on forever, and that appointment of Alicia Keys as Creative Director of BlackBerry really didn’t do any good did it. At the time the Informer noted that the singer-songwriter’s ditty ‘Doesn’t Mean Anything’ was most appropriate for the role.

No, what you need, if you’re a telecoms brand struggling to remain relevant with your audience, is a collaboration with an artiste struggling to remain in touch with reality. Even better, maybe go for a singer songwriter who’s about due a very public meltdown. Justin Bieber or even Myley Cycrus for example. The Informer can imagine it now: Thorsten Heins, or Steve Ballmer or maybe Steven Elop, twerking their way around the stage as a naked, sledgehammer licking Cyrus smashes the company’s dignity into oblivion with a giant Wrecking Ball.

The very thought makes the Informer shudder. Billy Ray would be so disappointed. Sinead O’Connor certainly is, although neither of them have struck a lucrative mobile branding deal.

Perhaps it’s a strategy Alcatel-Lucent should think about, having announced the axing of 10,000 jobs worldwide by the end of 2015. The reduction forms part of the firm’s ‘Shift’ plan to ensure a “sustainable financial future” and a “successful transformation of the company”.

The job cuts will extend to all geographic areas where Alcatel-Lucent operates, with the removal of 4,100 positions in Europe, Middle East and Africa, 3,800 in Asia Pacific and 2,100 in the Americas. By the end of 2015, Alcatel-Lucent said it will have halved the number of its business hubs globally.

Michel Combes, CEO of Alcatel-Lucent, said: “The Shift Plan is about the company regaining control of its destiny,” but the Informer suspects many of those 10,000 employees think there’s one too many ‘Fs’ in the plan name. One wag with an NSN email address wrote in to say that they liked the comments “around the company regaining control of its destiny… sounds very familiar…”

There was a little bit of good news for Alcatel-Lucent however as Telecom New Zealand gears up to launch 4G services in November, counting the infrastructure vendor among its suppliers.

The service follows the February LTE launch from rival Vodafone New Zealand and will initially be made available in Auckland, Wellington and Christchurch from November 12. The service, which uses spectrum in the 1800MHz spectrum band, will be available to both prepaid and pay-monthly customers at no additional cost on the operator’s current plans.

In December last year Alcatel-Lucent ran a trial in the Lower Hutt area of Wellington using the 2600MHz spectrum, while an Auckland trial took place in parts of the North Shore, also on the 2600MHz spectrum, and was conducted by Huawei. Vendors Cisco and Ericsson also formed part of the deployment.

On the other side of the world UK fixed line incumbent BT was going all 4G, having signed an exclusive MVNO agreement with EE to provide mobile communications to its customers and 88,000 employees.

BT already delivers mobile services to business customers under an MVNO deal with Vodafone but that contract was terminated earlier this year. BT said it will carefully manage the change from the current MVNO to EE to ensure a seamless transition for customers, initially focusing on large corporates, the public sector and small and medium-sized enterprises. The company said that “For consumers, it has a strong wifi presence that it plans to build on,” and it is not beyond the realms of possibility that the EE MVNO deal could see BT make a return to the consumer mobile space for the first time in 13 years, when BT spun off O2 (then Cellnet).

BT might be glad not to own spectrum however, if recent murmurings from Ofcom are anything to go by. The UK mobile carrier community is up in arms after the regulator revealed proposals to upwardly revise annual licence fees for the 900MHz and 1800MHz spectrum bands fivefold or more in some cases.

“Spectrum is a valuable and finite national resource, and charging for it can incentivise the optimal use of frequencies,” Ofcom said, no doubt rubbing its hands against the oncoming autumnal breeze. As you might expect the words “excessive” and “disappointed” have already been thrown out by the opcos and some pundits have warned that such price increases would only end up hurting consumers as operators pass the pain along. The licence holders in question have until mid-December to voice their concerns.

In other 4G news Telefónica is getting ready to drop $ 400m on darkest Peru over the next ten years as it looks to light up an LTE network in the country. The operator said it will provide high speed internet to more than 100 districts in Peru by 2016.

Meanwhile the Informer thought the Spanish mothership really had hired the big guns when he misread a press release title as “Telefónica appoints Master Chief to head financial services team,” which conjured up visions of the battle-suited hero of the Halo series walking into a meeting with terrified banking bigwigs, rifle casually nestled between shoulder and neck. It would certainly give the carriers some much needed clout.

But alas, Telefónica has actually appointed a MasterCard chief to lead its Digital Financial Services unit. Pilar Aurrecoechea has been in the financial services sector for 25 years and will join the operator group’s innovation arm, Telefónica Digital, reporting into Vivek Dev, CEO of Digital Services. Aurrecoechea joins Telefónica from MasterCard where she was general manager for Spain and Portugal.

US chip shop Qualcomm was also hiring this week, having announced the appointment of a former US ambassador to China to its Board of Directors, at the firm looks to expand its footprint in China.

Clark Randt served as ambassador to China between 2001 and 2009, and brings more than 30 years of experience as a diplomat, attorney and businessman with a comprehensive understanding of Chinese industries and businesses to Qualcomm.

From a better understanding of foreign cultures and business practices to a better understanding of the brain, as Qualcomm this week revealed that for the past few years its R&D teams have been working on a computer processor that mimics the human brain and nervous system so devices can have embedded cognition driven by brain inspired computing.

“We want Qualcomm Zeroth products to not only mimic human attributes, but also learn like humans. Instead of being programmed by writing massive lines of code, we’ve developed a suite of software tools designed to teach Qualcomm Zeroth products to understand what behaviour is desired and not desired,” the company said. Apparently the San Diego firm outfitted a robot with a Zeroth processor and placed it in an environment with coloured boxes and promptly taught the robot to visit white boxes only through dopaminergic-based learning, a.k.a. positive reinforcement—not by programming lines of code. This is similar to the positive reinforcement employed by the Informer’s co-workers on a Friday, by plying him with dark chocolate digestives in order to get AWIW written before lunchtime.

On the subject of autonomous thinking machines, Mercedes-Benz was showing off its driverless technology by sending its S500 Intelligent Drive concept car on a 100km trip in the South of Germany.

The luxury car firm set out to re-enact the journey made by Bertha Benz, the wife of the firm’s founder Karl Benz, in 1888 to demonstrate the suitability of the Benz patent motor car for everyday use. 125 years later, Mercedes-Benz has set out to prove a similar point with a driverless car.

Driverless cars operate through use of communicating sensors to ensure safe and efficient travel. Through vehicle-to-vehicle and vehicle-to-infrastructure communication there may be no need for traffic lights and stop signs when all of the cars on the road are driverless. The firm also made the point that “unlike Bertha Benz all those years ago, it did not have the road “all to itself”, but had to negotiate dense traffic and complex traffic situations.”

Expectations for driverless cars to take to the roads in the coming years are high; according the Institute of Electrical and Electronics Engineers (IEEE), and by the year 2040, driverless cars operated using M2M technology will account for up to 75 per cent of cars on the road worldwide.

And from robots doing their own thing to humans doing their own thing. Apparently real time self service (RTSS) is the key to encouraging consumers, especially those who prefer prepayment, to spend more on mobile data consumption, or so says Chinese BSS vendor AsiaInfo-Linkage. The firm commissioned some research from Northstream, which found that operators in Western Europe are missing potential annual incremental data revenues of €4bn.

A shift in strategy is required, the consultancy says. While RTSS deployments have so far focused on opex reduction through attempts to cut customer use of call centres, and Northstream found that mobile operators in Western Europe could stand to save €540m annually with RTSS, the firm argued that the focus should be more on revenue enhancement rather than cost management.

“Our research shows that RTSS has a much larger potential impact on data revenue gain than on opex savings in both the pre- and post-paid customer bases, yet operators are still focussing on opex savings,” said Bengt Nordstrom, CEO of Northstream.

Operators need to drive greater return on their mobile broadband network investments, according to Mohammed Sha, director of product marketing at AIL, and RTSS is the ideal way to enable customers to spend more on data. And while RTSS without parallel back end investment will not reap results, upgrading the back end without RTSS could be just as pointless, he suggested. “Investing in the back end without RTSS is like having great products in the store with no window displays. You’re making it really hard for customers to buy your service,” he said.

AIL’s longer term vision of RTSS is sophisticated and appealing, depicting users converting their unused SMS capacity into a top-up data allowance and gifting it to another customer, possibly paying a small conversion and/or transaction fee for the privilege. In another scenario a user could convert spare voice minutes into a time value for specific application usage, such as an hour of Facebook consumption.

Such capabilities could pave the way for mobile services as tradable P2P commodities, which is certainly an interesting idea. However, question marks hang over both operators’ ability and desire to fulfil these kind of advanced transactions, after all, like Mr Coleman’s mustard business, operators make their money from what customers buy and don’t use.

But perhaps this is exactly the kind of industry shake up tactic you can expect to be championed by someone like John Legere in his next “un-carrier” initiative. There might still be time for Smiley Miley to do a deal.

After all, he can’t stop and he won’t stop. But the Informer can.

Until next week,

The Informer

Telecoms.com

LTE broadcast: If at first you don’t succeed…

LTE Broadcast: Mobile TV by another name?

LTE Broadcast: Mobile TV by another name?

There can be no service proposition that better illustrates the gulf between concept and commercial success than mobile TV. A favourite of industry futurologists around the turn of the millenium, mobile TV provision was felt to be a logical extension for cellular operators and numerous powerpoint presentations were dedicated to a vision of the future that depicted us all watching scheduled television—some of it created specifically for the mobile platform—on our mobile devices.

Attempts to make it happen continued long into the last decade, with little success. Mobile TV was a tall order; it required new network technology (DVB-H, MBMS, MediaFlo) that in return created the need for new devices. Broadcast technology like DVB-H emerged from an industry that specialised in getting a signal to the top of a house, rather than specific, mobile devices within or outside of the house and handset technology, in terms of screen and battery performance, was not up to the mark. Then there was the business model. Mobile operators had no experience as content providers or aggregators and the digital rights quagmire swallowed many fledgling services. Without decent content or handsets equipped to display it, revenue was never going to be forthcoming.

The idea of mobile TV came about long before YouTube, NetFlix, Google and Apple were major forces in the mobile and internet markets. The changes these firms and others like them have wrought on both the mobile and television markets have been so fast and far reaching that any plans that the mobile industry had to create a mobile version of a familiar television service soon became hopelessly outdated.

And yet that core belief, that people would consume video on mobile devices, has been proven to be entirely justified. Not for the first (or last) time the industry showed itself far better at conjuring use cases than business cases and the explosive uptake of mobile video has become a burden rather than a bonus. And with consumption of video set to grow yet further the industry needs new ways to manage that burden. LTE offers operators a more efficient means of moving data from place to place but the idea that a broadcast model for the distribution of content could be more efficient still has refused to die. A number of companies, including leading vendors like Ericsson, Qualcomm and Alcatel Lucent, are putting weight behind LTE Broadcast and operators including Telstra and Verizon are showing serious interest in the solutions.

“If you have two to four consumers within a cellsite watching the same content then you’re better off moving to broadcast,” says Mazen Chmaytelli, senior director of business development for Qualcomm Labs. Chmaytelli is a veteran of Qualcomm’s MediaFlo programme and, while he concedes that the business model didn’t work, the technology was still seen as having value within Qualcomm, not least because of the substantial R&D investment that had gone into it, he says.

“With eMBMS as a feature in LTE Release 9 we looked at our platform and figured that we could port it over and make it LTE compatible,” he says. “Those standalone terrestrial broadcast systems that weren’t built on cellular standards needed their own spectrum, their own towers, their own capex and opex. With eMBMS that’s all gone. If an operator deploys LTE, they can add LTE Broadcast as a feature”

As the industry has evolved, Chmaytelli says, aims have changed in relation to broadcast services. LTE Broadcast is not about creating a separate television offering, a mini cable service. Instead it uses eMBMS to broadcast content when it makes sense to do so, either when there is a mass market for a scheduled event (like a sports match) or when there is breaking news of interest to a very wide audience.

Joakim Sorelius, LTE product manager at Ericsson, says that many operators are slightly skeptical. “The first reaction from MNOs is that this didn’t fly last time so why should it fly now,” he says. “But there are a few leaders among the operators who really believe in this and are determined to make it happen.”

Verizon is one of these operators, and has publicly committed to a 2014 launch, with some kind of service widely expected at that year’s Superbowl NFL event. Australian operator Telstra is another, with non-commercial trials beginning later this year, according to Mike Wright, the operator’s executive director for networks and access technologies. For Wright the benefits are not limited to the distribution of video content.

“We also see this long tail of file distribution to digital signage, or mass software updates and M2M applications,” he says. “With our trials later this year we want to understand the technology implications, what are the radio economics of it, how will it impact our core network but also we want to understand the wider ecosystem. We don’t see this as a simple technology change, more as an ecosystem evolution.”

Telstra has mobile distribution rights for AFL but is currently limited to streaming games to just 2,000 users at any one time, who pay an AUS$ 50/season subscription fee. With LTE Broadcast this should scale up far more efficiently, the firm believes.

But not all operators have these content distribution deals in place and a good number will be wary of moving into—or back into—that sphere of operation given the difficulties that have been previously encountered. So messaging around LTE Broadcast for the time being seems to be focussed primarily on the efficiencies that the technology can offer, as well as its potential as an off-peak data offload mechanism.

While eMBMS is a Release 9 specification, the feature in LTE Broadcast that enables dynamic handoff between unicast and broadcast is being codified in Releases 11 and 12, according to Mazen Chmaytelli, although the functionality was demonstrated at Mobile World Congress earlier this year. It may be more spectrally efficient to broadcast once a certain number of users are consuming the same content, but what happens to the other services that are operating in the same spectrum? The standard allows operators to set aside up to 60 per cent of FDD and 50 per cent of TDD spectrum for LTE Broadcast use. Trials are essential to find the key points at which efficiencies can be derived, says Telstra’s Mike Wright.

“We need to be aware that it’s not going to be that sophisticated on day one,” he says. “We need to understand the complex implications of a single frequency network, how to activate it, when you turn it on and when you don’t and what its boundaries are. But we have this vision that the network should be able to detect the optimal way to deliver content as different areas of the network see different levels of demand.”

What used to be talked about as mobile TV, and is now just called video, has certainly happened. And all the indications are that the volume of traffic will continue to increase at a gallop. Cisco reported in its VNI earlier this year that video traffic exceeded half of all mobile data traffic at the end of 2012 and will account for more than two thirds of it by 2017. Mobile operators desperately need to improve the efficiency of their video delivery and, if LTE Broadcast proves effective in this area then it will doubtless prove popular with the market. But history tells us that operators should be cautious in investing themselves too eagerly in the potential for true revenue upturn from the technology.

VIEWPOINT: Hector Menendez, wireless marketing director, Alcatel-Lucent

HectorMenendez

Hector Menendez

They say that necessity is the mother of invention— and there is a good deal of truth in that when it comes to LTE-Broadcast. Take the case of Verizon in the USA which—little more than two years after the launch of its LTE network—says that video now accounts for half of all wireless traffic; in fact Verizon predicts that will increase to more than two-thirds in the next three to four years.Faced with that level of demand, necessity, dictates that operators find a more spectrally efficient method of distributing video and other content—especially in locations having many subscribers demanding similar types of premium content. LTE-Broadcast—or eMBMS—will give operators the capability they need not only to service the demand, but also to offer new services. Like many innovations, eMBMS has at least one foot in the past as it borrows many of the techniques of wireline networks and translates them to a wireless environment. eMBMS is attractive to operators because LTE RAN networks can be readily made to support it through largely software-based enhancements— though some additional back office equipment such as LTE multimedia gateways will be needed.

What’s more, eMBMS service areas can be dynamically configured allowing operators the flexibility to offer a mix of broadcast or unicast based services. As a result operators can quickly adapt to the practice of a single broadcast to better meet subscriber demand in an infinitely scalable manner as in the case of a marathon or sporting event occurring in a section of town. But only using LTE-Broadcast to deliver that demand misses another part of the equation and indeed a new revenue opportunity. Combining LTE-Broadcast with a tightly configured metrocell deployment in, for example, a sports stadium, throws up a range of possibilities to deliver value added personalized services that take advantage of context based intelligence such as location or time.

At Mobile World Congress earlier this year Alcatel-Lucent showed how user generated video content could be stitched together, and broadcast over LTE in real time using metrocells, to add a new dimension of the subscriber experience. Operators deploying metrocells in the stadium, in combination with LTE-Broadcast services, could create whole new levels of interaction, generate revenue opportunities, and attract new customers. Operators could, for example, provide and broadcast exclusive footage or camera angles during the game, and could even broadcast crowd-sourced video content live during the game. But it is not just the video opportunity that LTE-Broadcast enables. Fans arriving at the venue could also immediately be pushed the “game-time” app which would only be available in the stadium with a host of pre-loaded content, features and statistics—all supported by advertising and sponsorship.

Of course mobile viewers watching the game on LTE-Broadcast away from the stadium could be offered a “remote” version of the same app without the stadium features.

In this way, LTE-Broadcast will both service demand and create opportunity. We certainly see it as a key component of “the critical bridge”, linking the content people want, to the devices in their hands.

Telecoms.com

Hutchison: “We don’t have a problem with innovation from OTTs”

John Blakemore is director of European regulatory affairs, Hutchison

John Blakemore is director of European regulatory affairs, Hutchison and will be speak on the topic on, “Growing the data roaming market” on Day 2 of the LTE World Summit, taking place on the 23-24 May 2012 CCIB, Barcelona, Spain. We catch up with him to see what the spectrum challenges are for 3, his views on roaming charges, and on innovation in the industry.

What are the main challenges as you roll-out LTE across your territories?

The main challenges are getting the right spectrum to enable us to deploy LTE. Besides that, there are concerns around planning permission in some countries, particularly for the large antennas. Deploying 800Mhz in some of our countries is a challenge as getting permission for a two-metre mast is not easy. Now a lot of operators will already have 900MHz so for them putting an 800MHz antenna may not be so problematic, but for us it could well be more difficult and time consuming to get the 800 ones up. On the commercial side, dongle availability is not going to be an issue – they’re already in the market where we’re already running LTE. The regulatory barriers are the main ones. We are a 3G-only operator so the only spectrum that we’ve got at the moment for our 3G at the moment is at 2.1GHz.

Are you bidding on other spectrum?

In Europe, where spectrum has become available, we have been bidding. What we’re seeking to do in common with all operators is to get low frequency spectrum but also to get sufficient contiguous blocks to provide the best LTE capacity. For example in Austria we have acquired 2.6GHz and we’ve also acquired 2.6GHz in Italy, Sweden and Denmark. We’ve also acquired some 1800MHz in Denmark and Italy – some of that has come up as its refarmed spectrum that has been made available. We have 800MHz in Sweden and an auction will be coming up in Denmark.

What about the situation in the UK?

There are ongoing consultations and discussion. I think that this process has gone on for a long time in the UK and in other countries it seems to have been resolved more easily. In other countries  some of the existing 900 and 1800 spectrum has been redistributed, whereas in the UK there has been no redistribution of spectrum held by the incumbent GSM operators, so that’s made it more difficult. For example in Sweden we’ve managed to get 5MHz of 900; we’ve managed to get 1800 in Denmark and 1800 in Italy. That’s made it easier to get all operators to have both low frequencies and large blocks of higher frequencies. In the UK the regulator has decided not to reallocate, which means there’s much more emphasis on the 800 and 2600. There are four operators and a limited amount of spectrum available so I think that’s the problem in the UK. In other countries, Demark and Italy, certain spectrum was reserved for operators that didn’t have existing holdings.

In Denmark some of the operators had to release an amount of 900 and 1800 spectrum to make it available to a new entrant to the band, it needn’t necessarily have been us – it could have been other operators, though we were in pole position to get that, but there has been a forcible distribution of existing holdings.

Is there a possibility of you refarming your 2100MHz spectrum?

I believe the legal position is that the European Commission is currently in the process of drafting a decision which would allow refarming of 2100 spectrum. Would we as an operator refarm? The current situation is that the only spectrum we have is 2100 and that is heavily utilised for 3G services so I don’t think that using the 2100 for LTE would be our best option. Of course, in the future, having the legal ability to do that refarming is obviously welcome.

Are roaming charges too high or is lowering them an unfair imposition?

We’ve been pretty strident on that actually. And we’ve said that for years the prices for roaming are too high and we’ve supported regulatory moves to force down prices and this has been our position since I’ve been working on it for at least the last six years.

A typical smartphone customer uses around 1GB of data per month, which in most of our countries will cost around £10, but a GB of data when roaming – well I don’t even want to make a calculation. We’ve always said that if you look at the kind of applications that people are using – mobile access – the value of it is greatest when you’re away from home. And LTE will bring this into sharp focus.

There are whole issues around how you actually charge for a services when you’re moving to an LTE roaming world because of course voice is going to be data, and if data roaming stays at current levels ( i.e. very expensive) then you won’t be able to use your phone at all!

I think that we need to step back and decide what is the service we are providing customers here? We’ve not providing voice, or SMS or whatever – what we provide is a mobile service, a whole bundle of different things that consumers use on their mobile handset. Now what we want to do as an operator is to increase the value to the consumer of that overall bundle.

If you imagine that you only bought a handset that you could only use in London then it’s not very valuable. It’s more valuable if you can use it across the whole of the UK, and even more valuable if you can use it across the whole of the EU. So we need more sensible roaming prices.

Why did 3 then remove its free roaming on its partner networks?

Some of our businesses, such as Austria still have ‘3 Like Home’ and we still offer it between Denmark and Sweden. The problem from the UK perspective is that it was causing quite a bit of confusion with customers. As soon as they went off one of our networks we were being charged high wholesale rates which we had to pass on to our customers.

Do you feel that there’s enough innovation in the mobile operator industry?

My observation here is, does it really matter where the innovation is coming from? We don’t have a problem with innovation coming from the OTTs. A few years ago, we had a service called ‘X-Series’, where we worked with Microsoft and Yahoo, and Skype to put their services on mobile devices. We did that when it was still early days and the services weren’t out there in the market. If you look at the industry as a whole, our record of developing services is not that strong. As operators, what we’ve been really good at is deploying efficient networks and making sure our networks support services – and that’s fine. We’re a little bit more relaxed about the content and applications not coming from within the industry.

What sort of changes would you hope to see in the industry over the next few years?

Quite a lot of industry moves are still quite defensive. As an industry, we’re still making money out of voice and SMS and, of course, the industry wants to maintain those margins. But we’ve got to grasp the changing world. There is this question of how we make money out of data but we need to embrace the world of data and applications. I think that as an industry we need to change from being a little bit defensive to being a bit more open to the new.

The LTE World Summit is taking place on the 23-24 May 2012 CCIB, Barcelona, Spain. Click here to register your http://ws.lteconference.com/interest.

telecoms.com – telecoms industry news, analysis and opinion

An Apple a day don’t keep the Dr away

“Get rich or die tryin’,” is the motto coined by rapper Curtis “50 (“fiddy”) Cent” Jackson and subsequently linked to rap culture worldwide. This week another famous rapper and producer, Dr Dre, became the richest of the rich – to the tune of $ 3bn – and is still very much alive.

As the man himself sang “mother******* act like they forgot about Dre,” and if they did, they were very much reminded of his presence as he sold his premium headphone business Beats Electronics and accompanying music streaming service Beats Music to Apple for $ 2.6bn up front and an additional kicker of $ 400m.

Both Dre and Beats co-founder, Jimmy Iovine, who is also chairman of Interscope Geffen A&M Records, will also become Apple employees. The Informer wonders whether the Dr will immediately be given a position of seniority or whether he will have to work his way up through the ranks from an intern role, maybe doing a couple of months behind the Genius Bar. The Dr will see you now.

It’s an interesting move for Apple but even more so for Beats, which has had a less successful tie up in the same sector before. A partnership with handset firm HTC reached a crashing finale in September 2013, when the headphone maker bought back the remaining 25 per cent of its shares owned by the Taiwanese firm for $ 265m. The partnership was a poor deal for HTC, which bought 50.1 per cent of Beats in 2011 for $ 300m and sold half of that back in 2012 for $ 150m.

So the soap opera is told and unfolds, I suppose it’s old partner but the beat goes on (da da dum da dum da da).

Perhaps showing he can still splash the cash as well as Tim Cook, ex-nemesis and ex-Microsoft chief Steve Ballmer popped up in the news today having dropped $ 2bn on NBA basketball team the LA Clippers.

If you’ve been following the news, previous team owner Donald Sterling, who purchased the team in 1981 for $ 12.5m, was recently caught shooting his mouth in a racist manner, prompting the need to find a new owner of the team. Rimshot!

The news has resurfaced that Japanese firm Softbank is looking to score a three pointer by acquiring T-Mobile USA from Deutsche Telekom. News reports suggest the two companies are hammering out a deal behind closed doors but such rumours have been rife for sometime in the wake of Softbank’s acquisition of Sprint last year.

Although T-Mobile USA claimed to have taken “virtually all of the industry phone growth” in 1Q14 winning market share from its competitors and reporting total net subscriber additions of 2.4 million, the operator still recorded a $ 154m loss in the quarter, compared to a $ 106m profit in the same quarter last year.

It’s understood Softbank met with banks in April to make financial arrangements for its latest offer but of course, regulatory approval is not a given even though the merger of T-Mobile USA and Sprint would still leave it in (a stronger) third place behind AT&T and Verizon.

In other acquisition news, the Competition Commission has cleared of the acquisition of Telefónica Ireland by Hutchison 3G but with conditions that show that the Commission is still desperate to maintain network-based competition.

Last year, Hutchison Whampoa, which operates the 3 brand in Europe, announced that it is to buy Telefónica’s Irish mobile operation O2 for €780m, with a further €70m payable if a number of agreed financial targets are hit. The deal takes 3 from a relatively distant fourth place in the Irish market to second position, behind Vodafone.

Hutch has offered a package facilitating the market entry of two MVNOs, with an option for one MVNO to morph into a mobile network operator by subsequently purchasing spectrum from the merged entity.

Stefan Zehle, CEO of Coleago Consulting, reckons Hutch probably has the first MVNO customer lined up, or else the acquisition cannot go ahead and the likely candidate is UPC, which is one of the few telecoms providers in Ireland with a large enough customer base to be comfortable to take on the fixed cost associated with becoming an MVNO under these terms.

However, Zehle warns, it is highly unlikely that the MVNO would want to become an MNO with all the cost implications as well as the daunting prospect of participating in future spectrum auctions to stay competitive. Therefore, just like in Austria, Zehle believes Hutch played it well by making a spectrum divestment offer that is unlikely to be taken up. “The Commission does not get it: In mature markets new network based market entry does not make sense. Consolidation is the name of the game for the European mobile industry,” he said.

There was some MVNO action going on back in the US, as specialist mobile entertainment and streaming music firm Rok Mobile unveiled plans to launch an LTE MVNO in the US in June.

Bolstered by access to 20 million on demand audio tracks, Rok said it would provide a nationwide LTE network strengthened by an ‘Always Best Connected’ user experience that enables customers to consume data-intensive services over wifi or cellular connections automatically, depending on which is most suitable at the time.

To deliver the offering, the company has tapped up Californian player Devicescape, which curates and automates amenity wifi networks into an international virtual carrier wifi network comprised of more than 20 million quality controlled hotspots pulled from more than 315 million global access points.

In some rare lunar news this week a demonstration carried out by researchers at NASA and MIT used four separate telescopes based in New Mexico to send a signal via laser to a receiver mounted on a satellite orbiting the moon.

The team made history when the Lunar Laser Communication Demonstration (LLCD) transmitted data over the 384,633 kilometers between the moon and Earth at a download rate of 622Mbps. They also transmitted data from the Earth to the moon at 19.44Mbps. So imagine hooking a lunar wifi hotspot onto the end of that.

From the moon to Men in Black, as Finnish network vendor Nokia announced the launch of a dedicated security unit at the beginning of next month that it claims will create “additional value” for operators and “make security a positive differentiator”. The new unit will be part of the Mobile Broadband division of Nokia’s Networks business.

Nokia cited a recent survey it conducted into customer acquisition and retention, from which it concluded that 75 per cent of end users consider security to be an operator responsibility. The firm said that “a significant portion” of mobile subscriber would be likely to churn from one operator to another in the face of security problems and that end users are prepared to pay a premium for enhanced security.

On the subject of premiums, a report written by two lawyers from US intellectual property firm WilmerHale in Washington with input from Intel’s legal officer, Ann Armstrong, in a personal capacity, claims that royalty demands on smartphones are currently so high they risk destroying profitability in the industry.

The authors based their research on a hypothetical smartphone selling for $ 400 and estimated that the potential patent royalties for such a device would exceed $ 120, making licensing fees on a par with the cost of components.

Sticking with components and security for a moment, US chip shop Broadcom has begun sampling a secure processor designed for a wide range of endpoint applications catering to the Internet of Things (IoT).

The StrataGX BCM58300 incorporates a high performance ARM Cortex A9 processor running up to 1.25GHz and BroadSAFE Security strong hardware-based protection. Good to know if you remember that the SANS Institute recently reported the discovery of the first malware compiled specifically for ARM-based connected devices including connected DVRs, which are typically found in security cameras.

Might be worth bearing in mind for Orange too, which unveiled a smart plug, remotely controlled by SMS or an application via web, tablet, or mobile that allows users to remotely control electrical devices like air conditioning or space heaters. It also allows them to monitor power consumption and set timers to switch devices on and off.

My Plug 2 can alert customers of power outages via SMS and is available to all mobile phone customers, regardless of their provider for €95 with no contract and includes three years of SMS service.

Existing service after less than a year however is Christopher Fry, Twitter’s senior vice president for engineering, who revealed he is stepping down and moving to an advisory role, effective immediately, with no explanation for the resignation.

Twitter has appointed Alexander Roetter, vice president for engineering, as Fry’s successor. Roetter is understood to have led engineering efforts on Twitter’s advertising products.

There was a fair bit of engineering going on in the core as Japanese carrier NTT Docomo, which recently announce plans to trial 5G, tapped up Alcatel-Lucent, Cisco and NEC to successfully virtualise the Evolved Packet Core (EPC) in joint verification tests to support the functions required for Network Functions Virtualization (NFV).

The aim is to enable faster delivery of new telecom services and boost performance by applying virtualization technology to EPC software that takes on LTE data communication functions. The companies checked the platform’s performance during a breakdown in hardware functions, when a backup structure was quickly and automatically constructed using different hardware in order to sustain stable data communications.

“NFV is highly expected to bring changes in the ecosystem of network industries,” said Seizo Onoe, executive VP and CTO at Docomo. “Nonetheless, unless there’s a high degree of collaboration between players, this would end up being a pie in the sky.”

Earlier this month, Docomo farmed out trial contracts to several big infrastructure vendors, including NEC, in order to pilot 5G mobile network technologies, promising data rates of 10Gbps.

Ericsson, Nokia, NEC, Alcatel-Lucent, Samsung and Fujitsu have all been selected to work on a 5G proof of concept system, using the 15GHz frequency band for the air interface as well as exploring the potential of millimetre wave technology at the 70GHz spectrum band.

In related news Software defined networking (SDN) specialist Cyan announced a collaboration with Telefónica and Linux developer Red Hat to develop an NFV architecture optimised for communications service providers.

Using the Red Hat Enterprise Linux OpenStack platform, Cyan’s Blue Planet SDN toolkit will be designed to orchestrate the deterministic placement of virtual network functions in the server infrastructure to maximize performance.

And just last night the ICT solutions arm of NTT, NTT Com, launched what it says is the first suite of cloud services that enterprise customers can activate themselves and pay for on a per-usage basis. NTT Com said the new services will enable enterprises to eliminate lengthy contract tie-ins, and establish new offices or short-term project support with minimal fuss.

The services are built on an NFV platform developed by Virtela Technology Services, which NTT Com acquired in January this year, and will be launched commercially in July.

“While many industry experts and service providers have long been speaking about the potential of NFV, we are excited to become the first service providers to commercialize NFV-enabled services on a global scale,” said Takashi Ooi, VP for Enterprise Network Service at NTT Com.

Allowing customers to access and manage their services through an SDN-enabled portal, said NTT Com, would mean service deployment times could be cut from months to minutes and configuration changes from weeks to real time.

And that’s about the size of it for this week.

Take care

The Informer

Telecoms.com