summary introduction to wireless lte* 4g architecture and...
TRANSCRIPT
Summary introduction to Wireless LTE* 4G architecture and key
business implications
L-F Pau, Prof. Mobile business, CBS [email protected]
� L-F Pau, 2011 Reproduction in whole or in parts forbidden
*: LTE: Long term evolution
ORIGINS OF WIRELESS COMMUNICATIONS:From electromagnetics to digitization and IP
• 1864: James Clark Maxwell– Predicts existence of radio waves
• 1886: Heinrich Rudolph Hertz– Demonstrates radio waves
• 1895-1901: Guglielmo Marconi– Demonstrates wireless communications over increasing
distances• Also in the 1890s: Nikola Tesla, Alexander Stepanovich Popov,
Jagdish Chandra Bose and others, demonstrate forms of wireless communications
• Since early 1900’s: development of broadcast radio, and later TV• World war 2: two-way radio in closed networks (esp. defense)• 1972- : NMT development to cater for telephony for nomadic
populations in Scandinavia• 1982- : Use of digital coding, modulation and communications• 2009: Launch of first 4G LTE commercial networks in Scandinavia
RADIO SPECTRUM (communications)
Frequency Usage Remarks
1 MHz-500 MHz Government use
450-470 MHz NMT (disapearing) , CDMA or GSM
470-862 MHz Analog TV, Govt.,Digital TV or 3G : ”DIGITAL DIVIDEND”LTE
800 MHz Mobitex USA900 MHz GSM, Mobitex EU806-960 MHz GSM 900 EU+Asia, CDMA,GSM 800 , TDMA US, PDC Japan,
UWB960 -1710 MHz Governement use: aircraft, GPS, satellite, radar
1710 -1880 MHz GSM 1800 EU , Asia and Brazil
1880-1900 MHz DECT
1900-2010 MHz CDMA, GSM 1900 , TDMA US1980-2010 MHz Satellite1710-1770 MHz Uplink free US1920-1980 MHz Uplink EU+Asia2110-2170 MHz Short range free2400-2483 MHz Bluetooth, UWB2480-2500 MHz Global star satellite telephony2500-3200 MHz Government; 2600 MHz band for LTE ?3200-6000 GHz C band and military radar5150-5825 MHz WLAN6000- Government7000-38 000 MHz Minilink microwavelinks
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CELLULAR MOBILE TELEPHONY
Antenna diversity Cellular concept
● Bell Labs (1957 & 1960)
Frequency reuse● typically every 7 cells
Handoff as caller moves Core network
● Central Switch, HLR, handover
Sectors improve reuse● every 3 cells possible
WIRELESS TECHNOLOGY GENERATIONS
G Key aspects Data Rates
1 Analog Typical 2.4 Kbps; max 22 Kbps
2 Digital – TDMA, CDMA 9.6 - 14.4 Kbps (circuit data)
2.5 GPRS – mux packets invoice timeslots 15 - 40 Kbps
3 Improved modulation,using CDMA variants
50 – 144 Kbps (1xRTT);200 – 384 Kbps (UMTS);500 Kbps – 2.4 Mbps (EVDO)
3.5 More modulation tweaks 2–14 Mbps (HSPA), then 28 Mbps& 42/84 Mbps HSPA+ evolution
4 New modulation (OFDMA); Multi-path (MIMO); All IP
LTE: >100 Mbps with adequate spectrum (15 or 20 MHz)
3G release 1999 Architecture (UMTS)
SS7
IP
BTSBSC MSC
VLR
HLR AuC
GMSC
BSS
SGSN GGSN
PSTN
PSDN
CN
CD
GcGr
Gn Gi
Abis
Gs
B
H
BSS Base Station System
BTS Base Transceiver Station
BSC Base Station Controller
RNS Radio Network System
RNC Radio Network Controller
CN Core Network
MSC Mobile-service Switching Controller
VLR Visitor Location Register
HLR Home Location Register
AuC Authentication Server
GMSC Gateway MSC
SGSN Serving GPRS Support Node
GGSN Gateway GPRS Support Node
AE PSTN
2G MS (voice only)
2G+ MS (voice & data)
UMTS Universal Mobile Telecommunication System
Gb
3G UE (voice & data)
Node BRNC
RNS
Iub
IuCS
ATMIuPS
3GPP release 5 ― IP Multimedia
Gb/IuPS
A/IuCS
SS7
IP/ATM
BTSBSC MSC Server
VLR
HSS AuC
GMSC server
BSS
SGSN GGSN
PSTN
CN
CD
GcGr
Gn Gi
Abis
Gs
B
H
IM IP Multimedia sub-system
MRF Media Resource Function
CSCF Call State Control Function
MGCF Media Gateway Control Function (Mc=H248,Mg=SIP)
IM-MGW IP Multimedia-MGW
Nc
2G MS (voice only)
2G+ MS (voice & data)
Node BRNC
RNS
Iub
3G UE (voice & data)
Mc
CS-MGW
CS-MGWNb
PSTNMc
IuCS
IuPS
ATM
IM
IPPSTN
Mc
MGCF
IM-MGW
MRF
CSCF
Mg
Gs
IP Network
UTRA
SEPARATION OF SIGNALLING AND TRANSPORT
• Like circuit switched telephony networks, 2G/3G mobile networks have one network plane for voice circuits and another network plane for signaling
• Some elements reside only in the signaling plane– HLR, VLR, SMS Center, …
Transport Plane (Voice)
Signaling Plane (SS7)MSCHLR
VLRMSC
SMS-SC
MSC
MAIN 3 G LIMITATIONS
• 1. The maximum bit rates were still a factor of 10 and more behind the simultaneous state of systems like IEEE 802.11n and 802.16e/m.
• 2. The latency of user plane traffic (UMTS: >30 ms) and of resource assignment procedures (UMTS: >100 ms) is too big to handle trafficwith high bit rate variance efficiently.
• 3. The UE terminal complexity for WCDMA or CDMA systems is quite high, making terminals expensive, resulting in poor performing implementations of receivers and inhibiting the implementation of other performance enhancements.
INITIAL LTE WORK (from 2002)
• LTE focus was on:– enhancement of the Universal Terrestrial Radio Access (UTRA)– optimisation of the UTRAN Network Architecture
• With HSPA (downlink and uplink), keep UTRA highly competitive for several years
• Access and bandwidth will be commodities; services are the differentiator– Per-session control supports per-application quality of service
(QoS) and per-application billing• Voice should “just” be one application integrated with others
SIMPLIFIED LTE ARCHITECTURE
eNodeB: Evolved node-BAGE: Access gateway entityEPC: Enhanced packet core IMS: IP Multimedia systemPCRF: Policy and charging function HSS: Home subscriber serverMME: Mobile management entitySAE: System architecture evolution
FROM HSPA TO 3GPP LTE and System architecture evolution (SAE)
• 3GPP (GSC 11) Work plan worked on evolving HSPA to HSPA+ with improvements (HSDPA and HSUPA) and connectivity to the SAE defined under LTE work.
• This preserved improvements for latency (protocol evolution and functional split), but had constraints in terms of support for legacy terminals and hardware changes.
3GPP Std, body (UTRA, UTRAN)
LTE Project (SAE etc.)
3GPP standardises LTE
LTE GOALS
• Evolutionary ladder beyond HSPA, called Long Term Evolution /System Architecture Evolution (LTE/SAE) towards ubiquitous mobile broadband
• Make the most of scarce spectrum resources: Deployable in paired spectrum allocations with bandwidths ranging from 1.4 MHz to 20 MHz, LTE/SAE to provide up to four times the spectral efficiency of HSDPA Release 6
• Deliver peak user data rates ranging up to 173 Mbps and reduce latency as low as 10 ms
• Leverage flat all-IP network architecture• Leverage a new air interface to significantly cut per-Mbyte
costs, with later improvements: e.g. a 4x4 Multiple Input/ Multiple Output (MIMO) scheme to boost downlink rates to 326 Mbps
LTE BUSINESS GAINS– Significantly increased peak data rates, scaled linearly according
to spectrum allocation– Instantaneous downlink peak data rate of 100Mbit/s in a 20MHz
downlink spectrum (i.e. 5 bit/s/Hz)– Instantaneous uplink peak data rate of 50Mbit/s in a 20MHz
uplink spectrum (i.e. 2.5 bit/s/Hz)
– Expectations of additional 3G spectrum allocations– Greater flexibility in frequency allocations– No native support for circuit switching domain (e.g. voice)– Continued cost reduction– Keeping up with other (including unlicensed) technologies (eg.
WiMAX)– Use the growing experience with the take-up of 3G to clarify the
likely requirements of users, operators and service providers in the longer term
WiFi OFF-LOAD
• Approx. 30-40 % of LTE usage will be from home / office• Thus, UE must support transparent off-load to home WiFi , or to
WiFi in neighboring sites (lightpoles on roads, etc.)
LTE Femtocells
• Another off-loading is via LTE eNodeB Femtocells (compliant with 3GPP Releases 8/9 and including L2/L3 stacks)
• Performances: 1 ms TTI for handover , >100 Mbps , at low power location determination with 0,5 m accuracy
• Specific functionality :automatic neighbor relations, SON, mobile load balancing , closed subscriber group options, LIPA, hybrid mobility and inbound mobility, network management for small cell networks
• Example suppliers: Tata Elxsi ; see Femto Forum• Business concepts: 1) off-load 2) closed groups 3) social femto
which combines location info with Twitter for check-in etc
HSPA /WiMAX /Early 4G COMPARISON
Peak Data Rate (Mbps) Access time (msec)
Downlink Uplink
HSPA (today) 14 Mbps 2 Mbps 50-250 msec
HSPA (Release 7) MIMO 2x2 28 Mbps 11.6 Mbps 50-250 msec
HSPA + (MIMO, 64QAM Downlink)
42 Mbps 11.6 Mbps 50-250 msec
WiMAX Release 1.0 TDD (2:1 UL/DL ratio), 10 MHz channel
40 Mbps 10 Mbps 40 msec
LTE (Release 8), 5+5 MHz channel
43.2 Mbps 21.6 Mbps 30 msec
INITIAL KEY LTE DESIGN CHARACTERISTICS
• Sophisticated multiple access schemes– DL: OFDMA with Cyclic Prefix (CP)– UL: Single Carrier FDMA (SC-FDMA) with CP
• Adaptive modulation and coding– QPSK, 16QAM, and 64QAM– 1/3 coding rate, two 8-state constituent encoders, and a
contention-free internal inter-leaver• Advanced MIMO spatial multiplexing
– (2 or 4) x (2 or 4) downlink and uplink
MAIN LTE ARCHITECTURAL ITEMS
• Modulation, coding• System architecture (SAE and evolution)• Evolved Node-B• Multiple input-multiple output (MIMO) transceivers• Other antenna techniques• Radio links and protocols• IP Multimedia system (IMS)• Voice support • Multimedia broadcast • Transport and scheduling
1G, 2G, 3G MULTI-ACCESS TECHNOLOGIES
4G and future wireless systems optimize acombination of frequency, time and coding
e.g. OFDMA & SC-FDMA
FDMA: frequency domain multiple accessTDMA: time domain multiple accessCDMA: code domain multiple access
OFDM: ORTHOGONAL FREQUENCY DIVISION MULTIPLEXING
– Many closely-spaced sub-carriers, chosen to be orthogonal, thus eliminating inter-carrier interference
– Varies bits per sub-carrier based on instantaneous received power
STATISTICAL MULTIPLEXING (in OFDMA)
• Dynamically allocates user data to sub-carriers based on instantaneous data rates and varying sub-carrier capacities
• Highly efficient use of spectrum• Robust against fading, e.g. for mobile operation
OFDMA (ORTHOGONAL FREQUENCY DIVISION MULTIPLE ACCESS )
• Orthogonal Frequency Division Multiple Access– Supercedes CDMA used in all 3G variants
• OFDMA = Orthogonal Frequency Division Multiplexing (OFDM) plus statistical multiplexing– Optimization of time, frequency & code multiplexing
• OFDMA already deployed in 802.11a & 802.11g– Took Wi-Fi from 11 Mbps to 54 Mbps & beyond
FREQUENCY DOMAIN FDMA vs. ORTHOGONAL FREQUENCY DOMAIN OFDMA MULTIPLE ACCESS
• OFDMA more frequency efficient• OFDMA Dynamically maps traffic to
frequencies based on their instantaneous throughput
FDMA
ChannelGuard band
OFDMA
SC-FDMA: SINGLE CARRIER FREQUENCY DIVISION MULTIPLE ACCESS
• Single carrier multiple access– Used for LTE uplinks– Being considered for 802.16m uplink
• Similar structure and performance to OFDMA– Single carrier modulation with DFT-spread orthogonal
frequency multiplexing and FD equalization• Lower Peak to Average Power Ratio (PAPR)
– Improves cell-edge performance– Transmit efficiency conserves handset battery life
UPLINK PARAMETERS (incl. TD SCDMA framing)
Uplink Parameters
Transmission BW 1.25MHz
2.5 MHz 5 MHz 10 MHz 15 MHz 20 MHz
Timeslot duration 0.675 ms
Sub-carrier spacing 15 kHz
Sampling frequency 1.92 MHz
(1/2 3.84 MHz)
3.84 MHz 7.68 MHz(2 3.84 MHz)
15.36 MHz
(4 3.84 MHz)
23.04 MHz
(6 3.84 MHz)
30.72 MHz
(8 3.84 MHz)
FFT size 128 256 512 1024 1536 2048
Number of occupied sub-carriers†, ††
76 151 301 601 901 1201
Number of OFDM symbols
per Timeslot(Short/Long CP)
9/8
CP length (μs/samples) Short 7.29/14 7.29/28 7.29/56 7.29/112 7.29/168 7.29/224
Long 16.67/32 16.67/64 16.67/128 16.67/256
16.67/384
16.67/512
Timeslot Interval (samples) Short 18 36 72 144 216 288
Long 16 32 64 128 192 256
DOWNLINK OFDMA PARAMETERS
OFDMA
Transmission BW1.25 MHz 2.5 MHz 5 MHz 10 MHz 15 MHz 20 MHz
Sub-frame duration 0.5 ms
Sub-carrier spacing 15 kHz
Sampling frequency 1.92 MHz(1/2 3.84 MHz)
3.84 MHz 7.68 MHz(2 3.84 MHz)
15.36 MHz(4 3.84 MHz)
23.04 MHz(6 3.84 MHz)
30.72 MHz(8 3.84 MHz)
FFT size 128 256 512 1024 1536 2048
Number of occupied sub-carriers†, ††
76 151 301 601 901 1201
Number of OFDM symbols per sub frame
(Short/Long CP)
7/6
CP length
(μs/samples)
Short (4.69/9) 6,(5.21/10) 1*
(4.69/18) 6,(5.21/20) 1
(4.69/36) 6,(5.21/40) 1
(4.69/72) 6,(5.21/80) 1
(4.69/108) 6,(5.21/120) 1
(4.69/144) 6,(5.21/160) 1
Long (16.67/32) (16.67/64) (16.67/128) (16.67/256) (16.67/384) (16.67/512)
INITIAL System architecture evolution (SAE)
SAE focus was on:– enhancement of Packet Switched technology to cope with rapid
growth in IP traffic• higher data rates• lower latency• packet optimised system
– through• fully IP based network• simplified network architecture• distributed control
LTE / SAE CORE NETWORK ARCHITECTURE (EPC)
• LTE/SAE architecture is driven by the goal to optimize the system for packet data transfer supported by a packet core network
• No circuit switched components in IMS/PDN; if circuit switched applications are required, they must be implemented via IP
• New approach in the inter-connection between radio access network and core network
• The core network provides access networks and performs a number of core network related functions (e.g. QoS, security, mobility and terminal context management) for idle (camped) and active LTE-UE terminals
• The Radio access network (RAN) performs all radio interface related functions
• Non‐3GPP access : the EPC will be prepared also to be used by non‐3GPPaccess networks (e.g. LAN, WLAN, WiMAX, etc.); this will provide true
convergence of different packet radio access system
SYSTEM ARCHITECTURE EVOLUTION (SAE)
– Achieving mobility within the Evolved Access System – Implications of using the evolved access system on existing and
new frequency bands– Adding support for non-3GPP access systems – Inter-system Mobility with the Evolved Access System – Roaming issues, including identifying the roaming interfaces – Inter-access-system mobility – Policy Control & Charging – User Equipment (Terminal) discovers Access Systems and
corresponding radio cells; implications of various solutions on User Equipment, e.g. on battery life
– Implications for seamless coverage with diverse Access Systems
– Migration scenarios
LTE’s System Architecture Evolution (SAE)
Diagram by Huawei
RAN (Radio access network)SGSN (Serving GPRS Support Node)PCRF (Policy and charging function) HSS (Home Subscriber Server)MME (Mobility Management Entity)SAE (System Architecture Evolution)
CORE NETWORK EVOLUTION
– In addition to IP Multimedia system (IMS) available in 3G, equivalent Circuit switching Services may be provided in LTE by IMS core, since Circuit switching domain is not supported in LTE
– Mobility Management Entity and User Plan Entity might be collocated in the Access Gateway entity
– Reduced number of nodes in the evolved packet core may be achieved compared to 3G to provide connectivity to IMS
PHYSICAL LAYER
• It provides the basic bit transmission functionality over air.• The physical layer is driven by OFDMA in the downlink and SC‐FDMA in the• uplink.• Physical channels are dynamically mapped to the available resources
(ph physical resource blocks and antenna ports).• To higher layers the physical layer offers its data transmission functionality
via transport channels.• Like in UMTS, a transport channel is a block oriented transmission service
with certain characteristics regarding bit rates, delay, collision risk and reliability.
• In contrast to 3G WCDMA or even 2G GSM there are no dedicated transport or physical channels anymore, as all resource mapping is dynamically driven by the scheduler
EVOLVED Node-B (eNodeB)
• No Radio Network controller (RNC) is needed anymore: eNodeB is the only network element defined as part of the radio access network UTRAN ; it is a Node-B/RNC combination (from 3G)
• eNodeB-B’s take over all radio management functionality; this will make radio management faster and hopefully the network architecture simpler
• It terminates the complete radio interface incl. the physical layer, and: Access Layer Security: ciphering , integrity protection on the radio interface , Mobile management entity (MME) Selection at Attach of the UE
• It includes old Node-B functions such as: Measurements Collection and evaluation , Dynamic Resource Allocation (Scheduler) , IP Header Compression/ de-compression
• It can carry out the management for cells not attached to the same eNode-B via an inter-eNodeB interface X2; this makes possible to coordinate inter-eNode-B handovers without direct involvement of the EPC
• An eNode-B can handle several cells.• It enables efficient inter-cell radio : User Data Routing to the SAE GW, Transmission of Paging
Message coming from MME , Transmission of Broadcast Info(System info, MBMS).
MULTIPLE INPUT-MULTIPLE OUTPUT (MIMO)
Multiple Input Multiple Output smart antenna technology Multiple paths improve link reliability and increase spectral
efficiency (bps per Hz), range and directionality
MIMO (Multiple Input Multiple Output) RADIO TRANSCEIVER
• LTE supports MIMO as the base option, with multiple transmitter and receiver antennas in a same eNode-B.
• Up to four antennas can be used by a single LTE cell (gain: spatial multiplexing)
• MIMO is considered to be the core technology to increase spectral efficiency.
ADVANCED ANTENNA TECHNIQUES
• Single data stream / user• Beam‐forming for coverage, longer battery life• Spatial Division Multiple Access (SDMA): Multiple users in same radio
resource• Multiple data stream / user Diversity : link robustness• Spatial multiplexing : spectral efficiency, high data rate support
MIMO BEAMFORMING
• Enhances signal reception through directional array gain, while individual antenna has omni‐directional gain
• Extends cell coverage• Suppresses interference in space domain• Enhances system capacity• Prolongs battery life• Provides angular information for user tracking
SPATIAL DIVISION MULTIPLEXING (SDMA) Smart Antenna Technologies
• Beamforming– Use multiple antennas to
spatially shape the beam• Spatial Multiplexing a.k.a.
Collaborative MIMO– Multiple streams transmitted– Multi-antenna receivers
separate the streams to achieve higher throughput
– On uplink, multiple single-antenna stations can transmit simultaneously
• Space-Time Codes– Transmit diversity such as
Alamouti code, reduces fading
2x2 Collaborative MIMO give 2x peak data rate by transmitting two data streams
LTE RADIO PROTOCOLS
• They are quite similar to the WCDMA protocol stack of UMTS.
• The protocol stack defines three layers: the physical layer (layer 1), data link and access layer (layer 2) , layer 3 (hosting the AS, the NAS control protocols as well and the application level)
LAYER 3 RADIO PROTOCOLS
• PDCP (Packet Data Convergence Protocol)– Each radio bearer also uses one PDCP instance.– PDCP is responsible for header compression (ROHC: RObust Header Compression; RFC
3095) and ciphering/deciphering.– Obviously header compression makes sense for IP datagram's, but not for signaling. Thus the
PDCP entities for signaling radio bearers will usually do ciphering/deciphering only.• RRC (Radio Resource Control)
– RRC is the access stratum specific control protocol for EUTRAN.– It provides the required messages for channel management, measurement control and reporting
• NAS Protocols– The NAS protocol is running between UE and MME and thus must be transparently transferred via
Evolved UTRAN (EUTRAN). 73– It sits on top of RRC, which provides the required carrier messages for Network attached storage
(NAS) transfer
RADIO LINK CONTROL (RLC)
• There is a one to one relationship between each Radio Bearer and each RLC instance
• RLC can enhance the radio bearer with ARQ (Automatic Retransmission on reQuest) using sequence numbered data frames and status reports to trigger retransmission.
• The second functionality of RLC is the segmentation and reassembly that divides higher layer data or concatenates higher layer data into data chunks suitable for transport over transport channels which allow only a certain set of transport block sizes.
LTE’s IP MULTIMEDIA SYSTEM (IMS) / Value Proposition
• Generate new revenue from new services– Per-session control allows IMS to guarantee QoS for each IP session,
and enables differential billing for applications & content• Reduce capital spending
– Converge all services on common infrastructure– Focus limited resources on core competencies
• To date, mobile operators have had no incentive to deploy IMS for voice services
Date
In the OSI model, each layer communicates only with the adjacent layer above and the adjacent layer below by Protocols
LTE services rely on mostly ISO/ITU approved IP protocols from IETF and/or other fora; TCP supported but still causing problems
The traditional approach has been to treat the layers as different entities
Example: TCP/IP protocols NB: the drawing gives protocols BETWEEN layers
PROTOCOLS
LTE VOICE by Circuit Switched fallback
• Circuit Switched Fallback (CSFB) enables mobile operators to provide voice services alongside their LTE network in the absence of IMS.
• LTE registered mobile devices ‘fall back’ to a 2G/3G domain to send/receive voice calls. CSFB saves time & CAPEX so operators can focus on meeting data requirements with their LTE deployments.
• VOIP interworking necessary
• Note: CSFB standard TS 23.272 allows network operators to carry voice traffic over existing GERAN/UTRAN networks from multi-mode LTE UE devices. This very practical goal is realized by a clever innovation: network awareness in the MME. Where overlapping networks exist, the MME may carry maps of UTRAN TAs (Tracking Areas) to LTE LAs (Location Areas) that allow the UE to utilize circuit switched services all managed from the MME in conjunction with the Mobile switching center. If no VoIP services are available, the UE is instructed to access the alternate network for voice calls.
VOICE OVER LTE
• VoLTE 3GPP standard may be added to IMS (with EPC / Policy control / Multimedia telephony) , along with enriched multimedia services
• MSF / GSMA VoLTE interoperability event, Vodafone, D�sseldorf, Sept 2011
• Question is whether operators can generate incremental revenues with high-definition branded voice services
• This would require the Evolved packet system (EPC) to expose network QoS to third parties via standardized API’s , to allow applications to move from best effort on default bearers to guaranteed QoS class
• Competitive approaches to VoLTE: Circuit switched fall-back (CSFB), GAN , VoLGA
MULTIMEDIA BROADCAST MULTICAST SERVICES (MBMS)
• MBMS (Multimedia Broadcast Multicast Services) is an essential part of LTE. The so‐called e‐MBMS is therefore an integral part of LTE.
• In LTE, MBMS transmissions may be performed as single‐cell transmission or as multi‐cell transmission. In case of multi‐cell transmission, the cells and content are synchronized to enable for the terminal to soft‐combine the energy from multiple transmissions.
• The superimposed signal looks like multipath to the terminal. This concept is also known as Single Frequency Network (SFN).
• The E‐UTRAN can configure which cells are part of an SFN for transmission of an MBMS service. The MBMS traffic can share the same carrier with the unicast traffic or be sent on a separate carrier.
• For MBMS traffic, an extended cyclic prefix is provided. In case of sub-frames carrying MBMS SFN data, specific reference signals are used. MBMS data is carried on the MBMS traffic channel (MTCH) as logical channel.
QoS AND CONFIGURATION
• QoS awareness– The scheduler must handle and distinguish different quality of service classes; otherwise real time services would not be possible via EUTRAN– The system provides the possibility for differentiated service
• Self configuration– Currently under investigation– Possibility to let eNodeB ‘s configure themselves
• It will not completely substitute the manual configuration and optimization.
TRANSPORT AND SCHEDULING
• IP transport layer– Enhanced UTRAN (EUTRAN) exclusively uses IP as transport layer
• UL/DL resource scheduling– In UMTS physical resources are either shared or dedicated– eNode B handles all physical resource via a scheduler and assigns them dynamically to users and channels; this provides greater flexibility than the older system--Frequency domain scheduling uses those resource blocks that are not faded; not possible in CDMA based system
BACKHAUL TRANSPORT NETWORKS
• Backhaul traffic load from/to an eNode B goes up an order of magnitude (x 10); typical number : 100-200 Mbps/eNode-B
• eNode B spatial density may have to go up x 1,5- 2,5 to deliver expected user experience
• TDM radio systems cannot handle this traffic • ROADM Fiber links are therefore preferred, if available in eNodeB • If not, improved microwave with >1 Gbps packet microwave (also
for aggregation), with narrow 7-14 MHz backhaul channel allocations
• Operators must secure eventually backhaul microwave spectrum, with associated costs (about 50 % of LTE microwave backhaul)
• Improved ring and mesh topologies connecting eNode-B’s with one another , with multiplexing, increases effective network capacity by x 4
LTE PERFORMANCE
• Radio performance, coverage and effect of frequency band• Data rates and peak data rates• Spectral efficiency• Network latency• VoIP capacity
LTE RADIO PERFORMANCE (I)
• Data Rates:– Instantaneous downlink peak data p rate of 100Mbit/s in a 20MHzdownlink spectrum (i.e. 5 bit/s/Hz)– Instantaneous uplink peak data rate of 50Mbit/s in a 20MHz uplinkspectrum (i.e. 2.5 bit/s/Hz)
• Cell size: – 5 km ‐ optimal size– 30km sizes with reasonable performance– up to 100 km cell sizes supported with acceptable performance
• Cell capacity– up to 200 active users per cell(5 MHz) (i.e., 200 active data clients)
LTE RADIO PERFORMANCE (II)
• Mobility– Optimized for low mobility (0‐15km/h) but supports high speed• Latency– user plane < 5ms– control plane < 50 ms• Improved spectrum efficiency• Improved broadcasting• IP‐optimized• Scalable bandwidth of 20, 15, 10, 5, 3 and 1.4MHz• Coexistence with legacy standards
INDOOR and SMALL CELL USE OF LTE
• Need to use low frequency 700-800 MHz LTE bands, as 2,6 GHz LTE would not work well
• Need for users to be able to mark traffic as low priority, so it gets shifted to off-peak delivery in return for reduced charges (due to decaying mobile data margins and excess peak data demand)
• Indoor femtocell networks and WiFi to offload macro networks, as well as signalling functions
• Exploit indoor the MIMO and beam forming capabilities
LTE LATENCY ISSUE
– Control-plane• Significant reductions in transition times from idle or dormant
states to active state
– User-plane• Radio access network latency below less than 5 ms
in unloaded condition (i.e. single user with single datastream) for small IP packet
Latency also being addressed in SAE
Camped-state(idle)
Active(Cell_DCH)
Dormant(Cell_PCH)
Less than 100msec
Less than 50msec
COMPLIANCE of TERMINALS
• Operators need to ensure LTE terminals can meet their own network requirements in an efficient manner
• GCF (Global certification forum) and PTCRB (PCS Type certification review board) tests
• TTCN scripts mandated for ETSI conformance tests
COMMON FEATURES of WiMAX and LTE• OFDMA (Orthogonal Frequency Division Multiple Access) and MIMO• Users are allocated a slice in time and frequency• Flexible, dynamic per user resource allocation• Base station scheduler for uplink and downlink resource allocation
– Resource allocation information conveyed on a frame‐by frame basis• Support for TDD (time division duplex) and FDD (frequency division
duplex)
DLUL
DL
ULFDDPaired channels
TDD: single frequency channel for uplink and downlink
DifferencesCarriers are able to set requirements for LTE through organizations like NGMN and ETSI, but cannot do this as easily at the IEEE-based 802.16LTE backhaul is, at least partially, designed to support legacy services while WiMAX assumes greenfield deployments
LATER LTE and SAE EVOLUTION
– No more macro-diversity• No soft handover required
– Security• Control Plane
– Ciphering and Integrity provided by eNode B (BTS)– RLC and MAC provided directly in the eNode B
• User plane – Ciphering and integrity in the eAccess Gateway
functionality
ABBREVIATIONS
• 3GPP Third Generation Partnership Project• AMC Advanced mezzanine card• ATCA Advanced TCA• ATL Application transport layer• AUM Auxiliary unit module• BB Baseband• CBU Cello basic unit• CP-OFDM Cyclic-prefix orthogonal frequency-division
multiplexing• CPP Cello processor platform• DPD Digital pre-distortion• DSP Digital signal processor• eNB Evolved Node-B• FDMA Frequency-division multiple access• FFT Fast Fourier Transform• FTP File transfer protocol• FU Filter unit• GPS Global positioning system• I2C Intelligent interface controller• IFFT Inverse FFT• IO Input-output• IP Internet protocol• L1, L2 Layer-1, layer-2• LTE Long-term evolution of third-generation cellular
systems• LTU Local timing unit
MAC Media access controlMCPA Multicarrier power amplifierMIMO Multiple input, multiple outputMP Main processorMTU Main timing unitOAM Operation, administration and maintenancePA Power amplifierPEC Processor element clusterRAS Radio and antenna subsystemRBS Radio base stationRF Radio frequencyRLC Radio link controllerRUIF Radio unit interfaceRX ReceiverRXIF Receiver interfaceRXRF1 Receiver RF1RXRF2 Receiver RF2SIMO Single input, multiple outputSISO Single input, single outputTCA Telecom computing architectureTCP Transport control protocolTOR Transmit observation receiverTRX TransceiverTX TransmitterUE User equipmentVoIP Voice over IP
Critical Review of LTE business models, and related research
issues
L-F Pau, Prof. Mobile business, CBS
� L-F Pau, 2011 Reproduction in whole or parts forbidden
ACCOUNTING and CHARGING in LTE / SAE NETWORKS (PCRF node)
• It is an evolution of the packet charging domain charging mechanisms for GPRS and UMTS
• It facilitates seamless interworking with legacy charging systems.• The charging filter rules are provided by the Policy and Charging Rule
Function (PCRF).• The IMS Charging Function provides information about the user’s session
(e.g. call control, multimedia, services).• The Application Charging Function provides information about the content
of the user’s traffic (e.g. URL, file or media stream name).
ATTRIBUTES AFFECTING THE PRICE OF AN LTE USER SESSION
• Usage time or duration.• Transferred data volume• Number of events (units)• Destination of session• Location and time zone of session• Origination• Quality of Service (QoS)• Radio Access Technology (RAT, e.g. LTE and 3G/2G in the case of handover,
non‐3GPP access such as WiFi)• Tariff Time• User identification
BUSINESS MODEL DEFINITIONS
• Academic definition : “A business model is a conceptual tool that contains a big set of elements and their relationships and allows expressing the business logic of a specific firm” (Osterwalder, Pigneur and Tucci (2005))
• Industry and policy making definition: � A set of agreements, intellectual property and pricing schemes, allowing a party to a service or product delivery to monetize its contribution and costs, while respecting law and social sustainability �
BUSINESS MODEL COMPONENTSTheir choice is normally task of Board
MIXTURES OF : • Strategic intent in the face
of disruptions and competition
• Role assumed or changes • Threats & Opportunities • Posture (e.g. service
models, IPR)• External processes and
tariffs• Internal processes
(technology, costs, expertise, HR, social policies….)
• Risk management
OR:
- What is goal or party to kill?
- How will you dress yourself up?
- Where, when and how to attack ?
- What are your weapons ?
- Engagement
- How to survive and repair?
- Where not to put your feet ?
THE TRADITIONAL OPERATOR MODEL limited to � Corporate strategy vs Service models � is
outdatedGoals in survival / profit game
Business strategy
Service revenue models
Access networks
THE INFERNAL EQUILIBRIUMand main lines of friction
• POLICY MAKERS• STANDARDS
• REGULATOR• LEGAL
• SUPPLIERS• FINANCING
OPERATORS
USERS
Enormous technology change from LTE
butBusiness models trump technology
andLegal-Regulatory trumps all
THE GROWING DIVERSITY OF BUSINESS STRATEGIES
• Drop fixed links (except fiber) and go wireless • Drop payment cards• Drop set-top boxes (not covered here )• Drop software licenses• Drop annual support fees• Live well by making systems very complicated• Bundle devices with content services• Live (well ) from basic services• Focus by sharing /sourcing with/from others• Live (well ) from others software and content• Live (very well) from your own software or content• Prey on others : live from search, indexing and advertisements• Create and lead with new traffic and communications services • Create and lead with new content delivery , preying on content owners
and other media• Create well and lead with new transactions intermediation, preying on
existing trading agents
RECAP: INITIAL TECHNOLOGY and COST MOTIVATION FOR LTE
• Need for higher data rates and greater spectral efficiency• Need for a Packet Switched only optimized system• Use of licensed frequencies to guarantee quality of services• Always‐on experience (reduce control plane latency significantly and
reduce round trip delay)• Need for cheaper infrastructure• Simplify architecture of all network elements
INITIAL OPERATOR VIEWS on LTE and IMS
• “LTE is an all-IP network”– Not compatible with legacy voice services– Assumes the use of IP Multimedia System (IMS)
• Initial LTE networks will be data only • Initial LTE handsets will be
multi-modal, supporting HSPA and earlier systems for voice telephony
• Voice over LTE via Generic Access
� Tektronix
ASSETS OF A SERVICE AND CONTENT ENABLER
Monetizing revenues by synergies
Improving margins and efficiencies by shared components and functionality
DISRUPTION 1 : MOBILE INTERNET
• Service providers are building mobile broadband access to the Internet; “we’re not in the telephony business any more”
• Any one else, such as IT or Internet firms or enterprises, finding value in the Mobile Internet, can also provide it
DATA GROWTH NOT MIRRORERED BY REVENUE GROWTH
VOICE Dominated DATA Dominated
TRAFFIC
REVENUES
REVENUE and TRAFFIC DECOUPLED
Mobile data traffic to increase dramatically, but operators need controls to protect revenues from user behavior, while some enterprises having other revenues do not!
DISRUPTION 2: UBIQUITY OF PRODUCTS and SERVICES
• Like it or not, a web of networked economies, nationally and globally, is being spun before our very eyes, with macroeconomic impact
MACROECONOMIC BENEFITS
• According to FCC chairman Julius Genachow : “Research has shown that consumer benefits are 10 times higher than the value the actual spectrum generates at auction. So US$30 billion of spectrum equates to US$300 billion of consumer benefits”.
• Every day we are not freeing up spectrum for mobile broadband is another day economic potential is not generated.
• In 2010 worldwide telecom services and products exceeded 1 000 BillionEUR (Source: Digiword Yearbook 2011) , but ICT&M is still not recognized as a macroecomic sector; equipment and content aggregation shares are rising while access service provisioning is falling since 2002 (Source: IDATE)
• Over next 5 years, needed investments in optical fiber and LTE in Europe would represent 30 BillionEUR (Source: IDATE)( approx. 12 % of avg. turnover) , amounts which can only be obtained by asset sales, or by merger based synergies
LTE COVERAGE & INFRASTRUCTURE COSTS DRIVE EXPANDED NETWORK SHARING
• For 50 M users in a mid-sized european country, greenfield LTE costs are about 2 Billion Euros, plus spectrum license costs, with a strong variability due to local aspects and reutilized infrastructure (esp. Transmission)
• LTE infrastructure investments are expected to exceed those in 3G from 2013
• LTE Network sharing will emerge as a strong differentiator to historic3G deployment, less because of costs, but more to enable much faster geographical coverage and enough spectrumCase Tele2 / Telenor (in Sweden): have established a JV to share
RAN’s and spectrum (900+2100 Mhz) , becoming MVNO’s on the jointly owned network
DISPUPTION 3 : CUSTOMER CENTRIC INFORMATION
MANAGEMENT• Often customer data and needs are kept in different silos across
different systems, and never put together• There is big value and economies of scale in re-intermediation• Example Scenario case: Broadband provider sends repeated letters
to your house addressed to a previous tenant, or about an additional service which you already set up, Telco is also missing out that you have your phone, Internet and TV with different suppliers,
• LTE enabled scenario example outcome: One supplier offers you a bundle, managing my customer data more effectively, My spend would be increased from 20 Euros to 70 Euros plus, with only moderately incremental costs due to SAE,
DISRUPTION 4: NEW ROLE of MOBILE TERMINALS
• LTE is not a smartphone on your hip, in your pocket, briefcase or purse—it’s a personal computer.
• We are truly at an inflection point in network history
DISRUPTION 5: THE �NETWORKED SOCIETY �
• “Anything that should be connected will be connected.” (Ericsson) • Under this concept it is predicted that the number of connected devices
will surge to 50 billion over the next 10 years, via the widespread use of embedded modules.
• LTE data flows will, alongside specialized access’es such as WiFi, support this vision
DISRUPTION 6: ENTERPRISE USE AND LTE RELEVANCE
• Enterprises are becoming increasingly mobile and looking for cost-effective, secure, high-performance wireless networking technologies that can support everything from mobile workers, converged applications to cloud computing and M2M applications, as Wi-Fi and 3G solutions are inadequate to support the coming explosion of wireless data and voice traffic.
• Enterprises are transitioning rapidly to wireless to handle mission-critical data traffic. While business uptake of fixed/mobile wireless solutions will be smaller than by consumers, the applications and their impact are expected as deep or deeper than for consumers.
• In this process, enterprises want to, and can, bypass operators• LTE applications :
1) Key applications inherited from 3G : mobile workers , telemedicine , law enforcement / security /emergency , connectivity of distributed offices , goods and vehicle tracking , M2M 2) New LTE applications resting on converged data/cloud traffic supplementing wireline broadband services : file sharing, multisite ERP , support of NFC/RFID , retail shops, building management systems , mobile banking (beyond payments)
LTE COMMITMENTS (March 2011) Source: Global mobile suppliers assn GSA
• 17 commercial LTE services launched • 64 commercial LTE services available end-2012• 140 firm commitments to deploy commercial LTE in 56 countries• 56 pre-commitment trials
NB: As of Aug, 2011, Verizon Wireless had completed LTE installations to cover 50 % of US population
TELIA SONERA and TELENOR LTE TECHNICAL TRIALS (Stockholm, Oslo) (March 2011 status, International connections)
Sources: Epitiro, SwissQual
• Peak download 48 Mbps , mean 36 Mbps (with 10-15 Mbps at times) , 23 ms TCP latency, 1,7 Mbps upload average , � 4,2 excellent � VoLTE quality (ITU-PESQ Mean opinion score) , call setup times of 0,6 s
• Further work on congestion, and in-motion measurements on real time applications
TELIA SONERA COMMERCIAL LTE LAUNCH RESULTS
• Launch in Stockholm and Oslo in December 2009 with a few hundred eNode-B’s, few thousands of Samsung LTE modems , with 6 months free service
• Initial Data rate tariff :599 SEK (62 Euros) flat rate• Operator chose vendors based on TCO total cost of ownership• User’s appreciate a lot uplink speed and latency as differentiators to
3G, and downlink speed as new feature; issue of 3G/4G handover• But speed is NOT the only thing which matters, customers say; after
6 months only 1000 paying subscriptions were registered for nomadic notebook users , all waiting for LTE phone terminals
NEW EU TELECOMS REGULATOR
• BEREC (Body of european regulators) created by Council and Parlament as part of new EU Telecom rules( Dec. 2009); it is made of 27 national telecom regulator heads, assisted by a BEREC office ; it replaces ERG; decisions are by 2/3 majority (and 50 % when BEREC gives opinions in the context of Commission’s analysis of measures notified to EU by national regulators)
• Has no executive power, but help national regulators and EU provide consistent rules and competitive conditions across EU, esp. for regulatory decisions with cross-border aspects (e.g. spectrum , third party access, social services, etc..)
REGULATORS VIEW OF LTE
• Regulators are normally technology neutral and should enforce technology neutrality, while recognizing benefits such as increased capacity for the same spectrum (spectral efficiency).
• But wrong spectrum allocations and schedules may put benefits at risk
• CASE : UK Ofcom details '4G' benefits : Ofcom said that '4G' mobile networks (based on LTE technology) will deliver “more than 200 percent of the capacity of existing 3G technologies using the same amount of spectrum”. However, it also said that this “will not on its own be sufficient to meet the expected growth in demand for mobile data.” The regulator highlighted that more spectrum will need to be allocated to meet future requirements – it is planning to auction 800MHz and 2.6GHz frequencies in 2012 in what was described as “the largest ever single auction of additional spectrum for mobile services in the UK.” It also noted that mobile networks will need to be “designed intelligently” to ensure the best use of spectrum and, “in particular, the research anticipates a greater use of small cells to meet demand in specific areas.” The 2012 auction will make available spectrum equivalent to � of that in use in the country today, and 80 percent more than was made available at the 3G auctions which took place in 2000. Some stakeholders have expressed concerns about the potential process, due to the spectrum allocations already held by operators, so that they would get “squeezed out”(e.g. Everything Everywhere, 3 UK). The regulator has said it will put frequency floors in place to ensure the survival of the smaller players.
POLITICAL BATTLES FOR LTE SPECTRUM
• LTE spectrum can come from old expiring licensed bands, or from analog TV bands (� Digital dividend �, or from miscellaneous small bands (defense, etc..)
• Licenses are typically for 20-25 years, mandate 99% of population coverage within 15 years, and for LTE a new priority to rural areas
• There is pending issue of lost/ unutilized WiMAX spectrum • Which bands are released to whom are often more a political decision,
than one based on benefits for all and improved coverage• CASE 1: Communications operators win digital dividend spectrum :
Germany : T-Mobile, Vodafone and O2 win LTE spectrum in Europe’s first digital dividend auctions
• CASE 2: TV and media companies renew and expand their licenses under migration to Digital TV diversity & richness: Brazil, Italy , Russia
LTE SPECTRUM AUCTION OUTCOMES• CASE Spain : Spain’s big three mobile operators – Telefonica, Orange and Vodafone secured LTE
spectrum in the 800MHz and 2.6GHz bands as part of an auction that raised EUR1.65 billion for the Spanish government. Vodafone paid EUR518 million for 20MHz in the 800MHz band and 40MHz in the 2.6GHz band, and also plans to re-farm some of its 900MHz GSM spectrum for LTE services. Telefonica said it had won five frequency blocks in the 800MHz, 900MHz and 2.6GHz spectrum but details of its holdings, and those of Orange, were not disclosed. Earlier in the year, Orange and TeliaSonera/Yoigo won the first round of LTE sales and, a further round of 4G auctions is expected in the autumn which could raise a further EUR2 billion.
• CASE Italy : Italy’s four main mobile operators - Telecom Italia (TIM), Vodafone, Wind and 3 – plus broadband provider Linkem, have declared their interest. The Italian government is looking for the auction to raise at least EUR2.4 billion, with a forecast of EUR3.1 billion if all the frequencies up are sold.
• CASE Germany: 4,4 BillionEUR from digital dividend 800 MHz with DT, Vodafone and O2(Telefonica) as main winners; spectrum divided into 41 blocks
• Case France : 2,5 Beuros per bid (spectrum award cannot exceed 15 MHz duplex in 800 MHz band and 30 MHz in 2,6 GHz band)
• This means LTE spectrum sofar costs 1/5-1/10 of 3G spectrum awarded in late 80’s/early 90’s in the same countries
• This means indirectly that data traffic (compared mostly to 3G’s voice and messaging traffic) should lead to Operating expense assessments (OPEX) reduced in the same proportions in operator’s minds, if licensing cost share stays the same
SPECTRUM BLOCK ALLOCATION ISSUE
• The issue centres around frequency band allocations, where no carrier has (or gets awarded) licences allowing them to create blocks larger than 15MHz in any one region while most are limited to 10MHz in metropolitan markets, compared with the 20MHz of contiguous spectrum that is needed to deliver the best possible LTE performance.
• In addition, the 1800MHz spectrum is also currently in use for 2G services, meaning that only a limited amount is available for LTE (e.g. Telstra, Vodafone)
• 700MHz and 2.6GHz spectrum has often not yet been allocated .
REGULATORS MUST RELEASE SPECTRUM
• In US, FCC plans to free up 500MHz of spectrum over the next decade for mobile broadband use, but warned that the industry needs to go further.
• Key to avoiding a spectrum crunch, are voluntary incentive auctions for TV broadcast spectrum
REGULATORY SPECTRUM RISKS FOR LTE
• Due to normal 20 MHz band needs for “best capacity” , spectrum licensing policies and regulatory plans may “make” or ”kill” LTE
• Additional spectrum will only provide modest gains and will not satisfy the rapid growth demand in data services
• Move to ever higher reaches of the radio spectrum (to build data capacity) is driving a shrinkage of ‘effective’ mobile coverage with enhancing capacity
• Network competition is weakening with shared infrastructures under reduced spectrum allocations, whilst retail competition is intensifying putting into question the emergence of the right new mobile infrastructure platforms to support the creative industries and consumer choice
EU’s LTE SPECTRUM REFARMING RULES
• In view of too many political games, and/or squeezing out auctioning processes (like in UK) , the European Commission has adopted technical rules on how the 700-900MHz and 1800MHz frequency bands should be opened to 4G technologies, stating that the move is “an important step to bringing wireless broadband access to more EU citizens and businesses.” It said that national administrations have until the end of December 2011 to adopt the decision into their national rules, so that GSM bands are “effectively made available for LTE and WiMAX systems.”
• One measure is to enforce a minimum amount of spectrum in each band for each incumbent operator
UPSTART COMPARISONS FIXED BROADBAND (xDSL,Cable) vs. LTE
• Initially mobile broadband performance is likely to remain significantly below fixed broadband performance until the rollout of additional spectrum and infrastructure for mobile services. Optical fiber will always dominate where available
• Despite the weaker performance when compared to fixed networks, there is a fast growing percent of households which use mobile broadband as their only means of Internet access, compared with <1 % percent in 2009.
• Virtual operators dependent on an incumbent to offer fixed broadband, may want to migrate a significant part of the customer base to LTE
• Case Vodafone Germany : Vodafone Germany is looking to persuade up to four million of its broadband DSL subscribers to migrate to LTE. Vodafone is currently being charged €500 million a year by Telekom Deutschland for using its fixed network, and that LTE offers adequate bandwidth to replace DSL as a broadband technology. The company is thought to be preparing a bundle of services aimed at tempting its existing DSL users to adopt LTE. Those that fail to migrate could be sold to another fixed broadband provider, indicating the Vodafone plans to terminate its DSL operations.
• Case Telnet (BE): is a CATV operator which runs LTE trials and is an MVNO on Mobistar, to defeat Belgacom on all broadband segments
NEXT DIGITAL DIVIDEND ?
• The move from analog FM radio to digital audio broadcast (DAB) raises debates
• Will it be used by small and local community stations (UK) , or sold for LTE (US) ?
NETWORK NEUTRALITY REGULATIONS (I)
• “Network neutrality” regulation bans operators from blocking or charging for Internet services (such as Skype or Google) over their networks . In other words, this prevents operators to become “self appointed toll collectors” on the Internet, including the LTE based mobile Internet.
• European Commission and European Parliament have endorsed network neutrality guidelines but have not yet taken legal action against operators that block or impose extra fees on consumers.
• Countries having voted favorably on network neutrality: Netherlands and Singapore
• CASE Netherlands : The proposal was passed by “a broad majority” in the country’s lower house and is expected to be signed into law soon by the Dutch Senate. Under the new Dutch law, local operators could be fined up to 10 percent of their annual sales for violations by the regulator, OPTA. Patrick Nickolson, a spokesman for KPN, said that the measure could lead to higher broadband prices in the Netherlands because operators would be limited in their ability to structure differentiated data packages based on consumption. “This will limit our ability to develop a new portfolio of tariffs and there is at least the risk of higher prices, because our options to differentiate will now be more limited”.
• Under network neutrality , Microsoft / Skype could evolve from its mainly PC-to-PC voice calling model today. But integrating Skype with Windows Phone could also strain Microsoft’s relations with operators. With voice-over-4G services still an issue for many operators, Microsoft has the opportunity to use Skype’s scale and heritage to provide a de facto 4G voice standard, potentially creating a serious challenger to operator-led initiatives such as VoLTE.
NETWORK NEUTRALITY REGULATION IMPACT (II)
• Case KPN: Dutch operator KPN announced a number of changes to its tariff portfolio, stating that it “has decided not to block any services, or to set separate rates for different services,” in line with forthcoming net neutrality rules in the country. However, it also acknowledged that “mobile data will become more expensive” within its bundles, and that “the consumer will pay more for a new smartphone because these devices are becoming increasingly expensive.” In a statement, it argues that “the traditional propositions based around SMS and voice traffic have become inadequate for the consumer and for KPN.”
OPPONENTS TO NETWORK NEUTRALITY
• Lobby of 30 operators and suppliers (incl. Deutsche Telekom, Alcatel Lucent) met EU in July 2011, using the � European digital agenda � as a pretext, to present 11 measures against network neutrality
• They want � differentiation � of Internet pricing and quality, at the expense of best-effort minimal service, with free negotiations and preferred agreements with content suppliers
BUSINESS CHANGE REGULATORY STRATEGIES
• 5 GHz spectrum maybe better than 700 MHz
• 2020: LTE* >80%; WiMAX* <5% or dead
• Should ask: Wi-Fi vs. or with LTE
• Value of TV white spaces: Secondary access
• Open 3 GHz – 10 GHz to all : License exempt on secondary access basis
ROLES
• Roles evolve from unilateral decisions, OR
• Roles evolve due to engagement in networks / ecosystems
� MAKE IT � or � BREAK IT � FAST
• THERE IS NO VENDOR DEFINED KILLER APPLICATION UNTILL USERS HAVE ADOPTED IT AND MADE IT SUSTAINABLE / ADDICTABLE
• THERE ARE ALWAYS KILLER APPLICATIONS FOR SOME IN LTE: THOSE OWNED & CREATED BY USERS
• INDUSTRY (computing, integrators, services, content) RESTRUCTURING IS INEVITABLE AS MISTAKES IN THE ABOVE MAKE YOU WIN /OR KILLs YOU FAST !
HOW HYPE CONFUSES USERS (Source: Retrevo)
• 34 % of iPhone users in June 2011, on the question of whether they would buy a 4G LTE phone in 2011, answered that they thought they already had it with their iPhone; similar rate is 24 % for Blackberry and 29 % for Andro�d smartphones
• Confusion due to digit 4 in iPhone 4
FUNDAMENTAL ECOSYSTEM SHIFT resulting from LTE
• The � consumer electronics/ circuit-switched connections / operator centric/ ISP/ content � inherited wireless value-chain is too complex and costly to manage, and leads to excessive fragmentation
• LTE enables a new simpler paradygm : � consumer electronics- IP cloud- distributed software creation- content � with collapsed data-and-voice networks ;
• This cut’s out over the short term most OSS , BSS , proprietary client software ; it disbands single vendor-single element Element management systems and centralized performance management databases; it also undermines retail access providers and distribution franchises; it enables both end-to-end proprietary or open links and relations
• LTE also triggers the categorisation of suppliers between innovators and service improvers
• Operators as high dividend investments for investors may be days gone by
FUNDAMENTAL SHIFT IN CUSTOMER RELATIONSHIP resulting from LTE
* Whether customer has a 1-on-1 or 1-on-N relation with suppliers, he must choose between different types of relations with each (wider than QoS / QoE / Bandwidth /Congestion and extending to tariffs , apps, eCommerce and content access exclusivity):• Best-effort/ � I am no one special � level• Customized/ � Just what I need � level• Quality class dependent/ � Selecting what to care for � level • Barter / � I swap my contributions against part of your
contributions � (time, information, community-access, user generated content,….)
• Social / � Don’t isolate me � * Above effects are only reinforced by network neutrality regulations : all users can potentially have access to the same performances and prices irrespective of technology
LTE AS A REBIRTH PROCESS TO UPGRADE CORE TECHNOLOGIES AND BECOME CLOUD OPERATOR
RATHER THAN PIPE VENDOR• Some forward looking operators, aware of future battles with new
categories of players, want to exploit the IP basis of the LTE core networks, to scrap old technologies and enable data servers, cloud computing and content servers
• CASE NTT DoCoMo : "Most of the investment will come from mobile operators as they not only build out their LTE networks, but also modernize their core networks to support an all-IP platform”
USER SELECTING PROVIDER(s) or WHICH IP CONNECTIVITY APPLIES TO LTE
• Scenario 1: one physical connection to IP access provider (ISP) • Scenario 2: user has multiple physical connections to multiple ISP’s• Scenario 3: end user has multiple connections to a single IP access provider
-Wireless operator becomes Internet service provider (ISP)
-Wireless operator must compete with other ISP’s ( fixed broadband, Digital TV, many companies in their own domains)
-Impact of multipath TCP (MTCP)
LTE WHOLESALE OPERATORS (I)
• As an alternative to network sharing , there is the LTE wholesale operator business model where one party gets spectrum, build, owns and operates the LTE access network and leases bandwidth to LTE Virtual operators , subject to QoS controlled by dynamic SLA’s. Contrary to most providers to 3G MVNO’s , the LTE wholesale operator has NO end customers of his own. The customer may own a network of his own, such as a legacy network.
• This is likely to be a more cost effective option for all than acquiring spectrum in auctions, although the rents will have to be strongly regulated
• This business model is akin backbone ISP’s (Level 3 etc.), and there is no regulatory protection of neither LTE Virtual operator and wholesale operator, as enterprise data traffic is unregulated.
LTE WHOLESALE OPERATORS : CASES (II)
• CASE Lightsquared (US): US wholesale LTE operator Lightsquared is in contract negotiations with 15 possible customers, according to chief executive Sanjiv Ahuja. Time Warner Cable is among those in talks to use Lightsquared’s network so that it can offer mobile web-access to its users. Other customers include Cricket Communications, Leap Wireless (operators), Best Buy (retailer), Lightsquared is using a combination of mobile and satellite spectrum to provide LTE network access to partners on a wholesale basis.
• CASE YOTA (Russia): The LTE network will be built by Yota and will enable MegaFon, MTS, Rostelecom and VimpelCom to provide high-speed mobile broadband services across 180 cities (with a total population of more than 70 million citizens) by 2014, without building separate networks. “
• CASE Kenya: Kenya’s government is poised to launch a tender for a consortium firm to “implement and manage” the LTE wholesale network. Those operators that do not form part of the consortium will be able to lease connectivity for a fee. “We are putting an advertisement of the 4G spectrum licensing either by the end of the week or early next week which is going to be done through Public Private Partnership,” said Bitange Ndemo, Kenya’s Permanent Secretary for Information.
FROM � OPERATOR � ROLE to SERVICE-and-CONTENT ENABLERS
* The new core asset of operators is no longer access provisioning (SIM, socket, cable) , no longer the customer database with telephone number (after number portability and multiple identities), but the information set made of:• Customer profiles and preferences• Usage intelligence• Performance intelligence• Contextual and eventually location information• Service focus on user needs and capabilities• Capability to add value to over-the-top applications
* Such information set must be exploited and updated to the fullest in policy and quota servers , identity management , open application and network interfaces , performance analytics, and fast connect/disconnect applications
TERMINAL and OPERATOR SHARED REVENUES
• For selected services, terminal vendor share non-exclusively revenues from those services with operators
• Case Nokia/ (Telefonica, Orange, TIM Mobile, T-Mobile, Vodafone) for some mapping and Ovi services ; contradicts non-revenue generating agreements with Yahoo / Google / YouTube which are an exchange
TELECOMS SECTOR NEW POSSIBLE BUSINESS PROSITION TO INTERNET GIANTS
• It could be to treat Internet giants as partners and clients, by offering them services to enhance quality of their own services for end users
• But Internet giants have treated such initiatives with arrogance and disdain, waiting just to collect the goodies on their ageing bodies (patents, spectrum, etc.)
BYPASS THE MOBILE OPERATOR AS VENDOR OF UE’s
• In this business model, prepared for LTE, third parties ally with SIM card producers (and IPR owners ! ) to produce mobile phones WITHOUT SIM card to be sold directly on the Internet, by passing the operators
• Case Apple/Gemalto : Apple and Gemalto (FR) are rumoured by G5 (european mobile operators) to design SIM-less iPhone (succeeding iPhone 4). Activation would be on-line on AppleStore via iTunes platform. Reactions are mixed, as some operators who do not subsidize phones don’t care much, Most terminal vendors are horrified (except RIM) , as this would remove operators in their role of creditworthy consumer loan providers to subscribers, and also as UE prices would then go further down. Regulators are worried as the risk is perceived of the creation of a monopoly in the control of the content delivery chain, reflecting Apple’s goal to achieve exclusivity in the relation to end-customer. Open issue is whether Apple would appear as an MVNO to use networks, even if chosen party would end up being just a pipe-provider.
INTERNET TV
• The television industry is at the beginning of a generational change which will eventually see a new type of television service – Internet Television – being delivered directly to TV sets in broadband-enabled households around the globe. In the end, practically all new TV sets will incorporate internet television functionality as a standard feature that viewers will be able to use alongside their existing television services, as well as embedded communications with fixed and/or wireless access feeds (WiFi and/or LTE).
• By 2014 there will be 785 million fixed broadband connections around the world which means that over 50% of TV households will have a broadband connection, most of which will be capable of supporting the delivery of high quality video and, therefore, Internet Television services.
• Knowing that change is coming, public service broadcasters, cable TV companies, satellite providers and terrestrial broadcasters around the world are busy rolling out their own Internet Television services. Meanwhile, they are trying to understand how Internet Television will affect their existing revenue streams.
• Many companies are rushing to develop the network infrastructure that will be needed to deliver the enormous volume video traffic implied if television programming is to be delivered over the internet on a mass scale.
CONTENT PROVIDERS � FREE RIDE � ON MOBILE NETWORKS
• In the context of LTE, European operators strengthen call for charging content providers (esp. video : Google, TV media, etc..) by changing the peering systems, under which operators exchange traffic where their networks meet ; charges would be based on how much data content traffic travels over operator infrastructures.
• Operators, esp. France Telecom and Telefonica, have stated that current peering agreements are no longer viable. It’s not certain the operators will succeed with their goal, noting that unless they receive widespread operator backing, then the content providers could try to restrict their material to operators that promise not to introduce traffic-related charges. Also, if the operators do all act together, it could open them up to accusations of cartel-style behavior.
DISINTERMEDIATION or NEW ECOSYSTEMS : LTE Mobile operators as banks, or banks as LTE mobile
operators
• Acknowledging that 3G operators had core architectural elements alike bank’s, as well as vice-versa, this is even more so for data driven LTE, which offers a technology upgrade from both’s costly infrastructures to IP based functionality, operating costs and value-added services
• LTE operators allowed a limited banking license (Asia, Africa) will monetize their assets not just in data traffic but in money flows and transactions
• Banks (subject to investment capacities) will want to monetize their ATM networks and control mobile banking in a coordinated way enabled by LTE
• CASE : LIVE FROM GSMA MOBILE MONEY SUMMIT 2011: Citibank and Standard Chartered – shared their perspectives on mobile money during this morning’s keynote session, claiming that their traditional strengths in areas such as trust, security and regulatory compliance means they must continue to play a key role in the emerging mobile money ecosystem. Dickson Chu of Citi acknowledged that banks remain “conservative organisations” and admitted that “most of the great innovations in payments didn’t come from banks.” And he warned that the rapidly evolving mobile money market “must not relegate us to becoming a dumb pipe.” His solution was to work towards a so-called “hybrid model” that combines the “bank grade” traditional payments model with the new advertising-funded models being rolled out by the likes of Google and Apple. “It is about players within an ecosystem understanding each other’s roles, but there are business model complexities that need to be solved,” Chu said. “Providing a great user experience, retail distribution and customer service – this is a role for the MNOs. Trust, safety and regulatory compliance –this is something the banks do well. Once these players come together, they will figure out how to co-operate and make money.” Meanwhile, Standard Chartered’s Aman Narain outlined progress on the bank’s ‘Breeze’ mobile app, which he said was available on more than 700 devices in India alone. “The mobile device is a phenomenal opportunity for us to create exceptional user experiences for people,” he said.
• CASE : UK : The UK payment council has essentially ruled against operators, allowing banks to have a separate mobile payment infrastructure, and only using operators as pipe providers; needless to point at the banking lobby in UK
SMART BUSINESS NETWORKS
• LTE enables the quick connect/ disconnect esp. between SME’s choosing to share dynamically expertise and ressources in dynamic alliances
• SAE being SOA compliant, it can support risk minimization and trust building tools by dynamic Service level agreement management between partners, while monitoring QoS attributes, assuming back-up legal contracts
• References: EU FP7 Trustcom project , and Smart Business network research
LIVING… WELL FROM LTE Intellectual property
• Contrary to earlier mobile generations which had a heavy radio/ hardware focus, LTE will have a balanced hardware /software / management intellectual property base, with software part growing
• This even enables the possibility from some key players to monetize a larger part of their IPR, at higher rates, also as a means to disrupt new entrants from computing and Internet
• Major LTE IPR owners (Amortized IPR portofolio values > 1 Billion EUR): Qualcomm, Nokia Siemens, L,M, Ericsson, Agilent , NTT ; Upcoming: IBM, Hewlett Packard, Intel, Huawei , Broadcom, Cisco, Tecnicolor/ Fraunhofer; Very low: Apple, Google, Microsoft
MERGERS OR ACQUISITIONS NOT FOR REVENUE BUT FOR SPECTRUM
• If you have invested early in upgrading your SAE core network architecture, spot targets to buy who have won later on favorable LTE spectrum chuncks
• Case AT&T: it’s long-term LTE strategy was dependent on how much spectrum it could obtain, an issue which was a major driver behind its 39 BUSD acquisition of T-Mobile
IS LTE RELEVANT FOR MICRO-NICHES ?
• The long-tail effect of the demand-volume curve (diversified small offers for small-volume products) applies to LTE more than 3G, because of virtual storage, distributed application developments, global coverage, and therefore distributed distribution aimed at tribal micro-audiences driven by the large volumes of LTE subscribers in the future
• Due to the ubiquity offered by LTE , it will be a trend setter for some services
• Example: mobile blogs are the long tail of media ; micro-cultures e.g. for youngsters and seniors
…AND FIXED BROADBAND vs. LTE ?
• Case: Saudi Telecom global operations (Interview of 09/8/2011 with Telecoms.com for WW Broadband Forum) :
To what extent do you see next generation wireless technologies such as LTE as a threat to your fixed line business? • “As an operator, we want to be able to use all available technologies,
and we do not see them as competing but as complementary. Each technology has its advantages, and considering the large variety of configurations in our markets, between Western Europe, Eastern Europe and Africa, we will rely on both wired and on wireless. Typically, in Western Europe, the wireless technologies are and will remain complementary to wired technologies at a higher cost and lower performance in term of overall throughput. In other geographies however, LTE may well become a very efficient fixed wireless access solution.”
OPERATOR’S CONTROL OF TERMINAL SOFTWARE IS SLIPPING
• Affordable open mobile Internet access is possible helped by smartphone diffusion
• Operators’ control of handset software slipping– iPhone, Android , Nokia application stores initiatives – Mobile OS :now under IT industry (Microsoft, Google, Linux…
even Symbian now Arthur Andersen)– Distribution by third parties grows
THE RIGHT TERMINALS FOR USER UPTAKE …
• Business model: Terminal and other UE suppliers target entry markets based on data usage, pricing power for products, operator independent channels, mobile data plans and network availability, while supporting the migration of apps and content
• A top 4 terminal CEO : “Selling LTE now is like selling the best grammophone with Deutsche Gramofon’s full collection for at customer’s fingertip, all for the price of a 33 rpm record”
• Consequence: the above business model will project and maintain the current Digital divide in all markets
• Case HTC: “CEO Peter Chou has confirmed that the Taiwanese smartphone vendor is to launch its first LTE handset in 2010, and expects the US to be the key market for its new devices in 2011. "We think that the US mobile operators will be taking the lead and pushing 4G LTE in the US market, HTC’s new LTE smartphones are based on Google’s Android and Microsoft’s new Windows Phone 7 (WP7) operating systems. Chou said that the firm was focusing its efforts on these two platforms as part of a “portfolio strategy” aimed at offering consumers the broadest possible choice. “[Customers] may want Windows or Android; or they may want big screen or small screen, they may want keyboard or tablet; HTC will let the consumer decide,” he said. Chou also talked up HTC’s commitment to cloud computing, pointing to the recent launch of HTCSense.com, which allows users of HTC's Android-based devices to manage smartphone data on a regular website. “HTCSense is a very important step for the HTC brand,” he said. ”We see HTCSense as an extension from the device to the cloud, [allowing users] to manage their portfolio, their data and their user experience from the cloud.”
DRIVERS
• Mass customization (with personalization amongst discrete choices a simpler instance)
• Simplicity• Open ecosystems and interfaces in
networks (e.g. IEEE P1520)• Time preference incl. Casual usage
3G/4G DATA ONLY SUBSCRIBERS
• Soaring adoption of 3G “USB Data Modems”– 92% of all 3G data bytes in Finland already in 2H07
Enormous growth, from a relatively small base…
CONTENT KEY TO LOYALTY
• It is Apple, Google and changing players like France Telecom that are benefiting from customer stickiness, in line with their central positions in the mobile content ecosystem.
� Zuckerberg’s law �
• Every 12-18 months the amount of information being shared between people on the Web, doubles �
• Over time, people will by-pass general sites in favor of sites built atop social networks, where they can rely on their friends’ opinions
• You pick the network, and the network then filters for you
ECOSYSTEM ADAPTATIONS
• Wireless operators must collaborate for software, app and content development with new players with shared revenue streams
• IT and content providers must collaborate for apps, browsers, functionality and service provisioning with wireless industry with shared revenue streams
• Nothing new in this ever since France Telecom started Minitel , copied by NTT with WAP , and then later by Apple
• CASE Verizon Wireless: opened its Innovation Center in Waltham, Massachusetts, billed as a place where “companies large and small, entrepreneurs and others across the LTE ecosystem would come together to create the next generation of products that wirelessly connect people, places and things.” A sister Innovation Center on the West Coast is due to open later this summer in San Francisco, focused on application development for LTE technology.
• CASE Google collaboration with France Telecom : the big Internet companies will not agree to invest in network capacity, but are ready to collaborate with operators to develop more intelligent/reduced uses of operators' networks and to educate consumers
MIGRATION GAMES: � MILK � HSPA, DELAY LTE (akin milk 2G, delay 3G)
• Case T-Mobile (USA) (now bought up by AT&T): The company made numerous references to its '4G' strategy, although this refers to its 42 Mbps HSPA+ deployments rather than LTE (or an alternative). The company said itself as being in an “excellent position for the coming years to provide customers with products and services that enable them to get the most out of the mobile internet,” and that “LTE technology is to be introduced once devices are readily available and once device quality is on par with the HSPA+ network, although that will probably not be for a few years.”
• Effect of LTE announcements on churn : T-Mobile USA noted that its HSPA launch had a positive impact on churn development.
PROPRIETARY TERMINALS AND CONTENT PROVIDERS MAY DELAY OPERATORS PUSH TOWARDS LTE
• Because of terminals, content and applications “stickiness” with some users of proprietary systems such as Apple iPHONE, Apple is hindering US moves towards LTE (LTE compatible iPhones only > 2013) ; Microsoft has not yet integrated VOIP Skype clients into Mobile Windows 7
EVOLVING USER SERVICES
• New services will center on data and multimedia communication alongside or within the context of voice.
• New services are expected to become major growth drivers. While voice remains the most popular application for large user segments, several distinct trends will influence mobile communications in the years ahead.
• Common, access-independent Internet applications will replace silos for mobile applications and residential applications
Service packaging evolutionfrom old gold coin deposits/payments to converged experiences
Converged services Converged payments Converged experiences
•One bill
•One prepaid balance
•Separate Voice / data /content
•Cross-product discounts
•Account /service / payment method agnostic pricing
•Multi-service � vouchers �
•Unified balances for voice /data / content
•Services interleaved to create differentiated experiences
•Dynamic personalization driven by user
•Integrated view of customer usage
•� Exclusive � content
•Real time sampling of any service
Increased value to user
Evolution of service revenue model (thanks to operations and network management policies)
� New � service models (subscription or prepaid) :• Speed-rated• Time-based (by min of mobile data, not MB; e.g. TIM)• Bandwidth usage and application specific• Time-of-day • Location-based • QoS based• Ad-funded solutions • Pay per content, rather than via ads revenue, including
via streaming
• Towards a data-centric world (and not voice centric) as a result of massive growth in data throughput, esp. Mobile
• Free Internet services are vanishing • Free copyrighted content is vanishing • Flat-rate data plans are unsustainable
Does it sound familiar or are you too young to remember ?
LONG TERM PARALLELS: Intelligent Networks (IN) & IP Multimedia system (IMS)
Intelligent Network• Free operators from equipment provider lock-in• Separate applications from basic call control• Open protocols and APIs for applications
IN Application Successes• FreePhone, Mobile (HLR), Pre-paid, Voice mail, …• 25 year summary:
A few applications, very widely deployed
SOCIAL NETWORKS BUSINESS MODELS or the LACK OF THEM
• Lack of suitable business models is and has been a barrier to social networks
• Research question: What are the possible business models for LTE based social networks?
SOME CATEGORIES OF SOCIAL NETWORK BUSINESS MODELS
• Subscriptions with premium modes • Sponsored advertising: Sponsored spots that works like sponsored advertising on Google• Viral Social Ads (ads targeted based on member profile data): provide advertisements alongside
related actions your friends have taken on the site ; they spread company message virally through the social graph. These ads will appear both in people’s feeds and as a personalized banner ad
• Beacon (a way e.g. for Facebook members to declare themselves fans of a brand onother sites and send those endorsements to their feeds)
• Insight (marketing data that goes deep into social demographics andpyschographics which can be provided to advertisers in an aggregated, anonymous way
• Connect with real people and create your own pay per click (CPC) or impression (CPM)• Virtual goods in Virtual currency (e.g. ”Facebook credits”) ; the goods are centered around
holidays, special events: Valentine’s day, birthdays, as well as just for fun ; 1 gift = 10 credits , 10 credits = 1 Euro
• Advertising revenue generated by deals for ”Branded virtual gifts” ; branded virtual gifts receive 10 times the interaction level of their non-branded counterparts ; branded virtual gifts turns customers into brand advertisers
• Enabling eCommerce : by promoting real goods ; e.g. Flowers.com : 12 roses = 450 credits• Pre/post-roll advertising : Pre-roll ads are short video clips that you must watch before the video;
regular video banners; post-roll advertising: if you don’t click on an overlay ad when it shows up in a clip you’re watching, the video ad it would have played rolls automatically at the end of your video.
• Tracking progress with real-time reporting• Gain insight about who's clicking on your advert.
LTE EARLY MOVER STRATEGIES
• Pricing : Encouraging customers to adoption by pricing, based on a growth in smartphones and associated data use (e.g. Tele2 )
• Leapfrogging : Move straight from a 2,5 G technology or to drop WiMAX (e.g. Metro PCS in the face of insufficient 3G capacity moving straight from CDMA to LTE)
• Enhancing user experience: promote e.g. video offered by LTE ,rather than speed and technical performances
• MVNO model (e.g. Cyfrovy Polsat, PL)
WHOLESALE PIPES TO CONTENT PROVIDERS
• One business model is for network owners to charge content providers for delivering this content to end users with QoS guarantees, so they can invest in needed infrastructure, based on :-either data amounts (Telefonica)-value of content charged to users (Vodafone)
• This is opposed by supporters of network neutrality
LTE Tariffs plans (2011)
• Globally comparable tariff plans span from 25 Euros/month (Estonia) to 110 Euros/month (Austria)
• CASE Verizon Wireless : for download speeds of 5 Mbps -12 Mbps and uplink speeds of up 2 Mbps - 5 Mbps, there are two 4G LTE Monthly Broadband plans, on a 24 month contract term:
A- 5 GB monthly data allowance with a $50 USD (38 Euro) per month planB- 10 GB monthly data allowance with a $80 USD (60 Euro) per month plan
The 4G LTE modems available include: LG VL600 and Pantech UML290 4G USB which both cost $99.99 (75 Euro) USD – again based on a 24 month contract term (after a $50 USD (38 Euro)mail-in rebate).• CASE Vodafone Germany : LTE “Surf Stick” USB modem offers a minimum speed of 3Mbps
and is positioned as an alternative to fixed Broadband, esp. in so-called “white DSL spots” DSL services, and in 1500 towns (March 2011).Modem costs 1 Euro to purchase with a 2.50 Euro per month fee. There are 3 usage based tariffs called the LTE “home internet tariff”:
A- 39.99 Euro per month up to 7.2 Mbps download speedB- 49.99 Euro per month up to 21.6 Mbps download speedC- 69.99 Euro per month up to 50 Mbps download speed
• CASE AT&T: 29,99 USD/month plus ‘AT&T Mobile Hotspot Elevate 4G’ with LG & Sierra Wireless HSPA+ modems that are software upgradable to LTE; they fall back onto AT&T’s HSPA+ network when out of reach of its new LTE coverage area
TEMPORARY HALT TO UNLIMITED DATA PACKAGES?
• Early deployment customers were often promised unlimited data transfer quantities for a flat fee (still : Sprint, Telia , Tele2) , which lead to overloaded core networks and delays / losses in non-LTE services (often due to HSPA enabled iPhones). As a result, either you sur-charge for excess data over a cap (“overage”) or you throttle down speed beyond the cap
• Most uncapped plans have been scrapped (AT&T, O2, … ) , with migration of tariffs offering useful insights
• Capped data packages are unsustainable , and can be alleviated by personalized bundles, as users do not want to differentiate between wired and wireless broadband
• CASE O2: O2 UK scraps unlimited data for smartphones with usage capped at between 500 MB and 1GB depending on monthly tariff. New and upgrading smartphone customers received unlimited data as a promotion until 1 October 2010. From that date, they could buy additional data ‘bolt-ons’ which include 500MB for �5 or 1GB for �10. Equipment provider: Nokia Siemens Networks
• CASE AT&T : AT&T had marketed the fact that the vast majority of its customers (97 percent) would not need to buy additional data allowances with the new capped model, to be swiftly contradicted. It replaced the US$29.99 unlimited plan with two new plans; DataPlus cost US$15 / month (200MB of data) , whilst DataPro cost US$25 / month (2GB of data). If users exceed the monthly allowance, they will receive an additional 200MB of data for US$15, and an additional 1GB of data for US$10, for use in the cycle, respectively.
LTE ADAPTIVE TARIFF PLANS with Bandwidth / Value adaptation
• Mobile operators can use adaptive self-managed rate plan structures to help solve the bandwidth/value gap.
• Example of adaptative plan : - €20 for 3GB/month- and if over the cap, then €7/GB+ peak bandwidth limit - User Self-care Portal
* €1 for 1 hour “turbo” button when peak hour bandwidth limit applied * €5 “add-on” for unlimited* use of a user-selected URL subject to peak hour bandwidth limit if > 1GBof
usage/month * User may enable daily or monthly usage caps for all devices under the account * User may self-manage other value-added options such as content filtering, security settings, etc.
• Such a rate plan would deliver several key enhancements over the typical cap + overage rate plan approach: - Directly addresses peak bandwidth utilization and the true cost of marginal
network growth - Drives users to make value decisions based more in line with operator cost - Extends sticky, revenue-generating features such as account and parental
controls to service-based consumption limits - Offers ARPU-expanding options in search of market share growth rather than
simple discounts
LTE REVENUE EROSION EFFECTS
• Subscribers will use bandwidth and data volume hungry services (e.g. mobile video)
• IP enabled LTE will put pressure on tariffs with flat rates• Internet and VOIP players will cut voice and content delivery
revenues
LTE REVENUE EROSION EFFECTS: THE � SIMPLE � COUNTERMESURES
• Improve customer experience by service creation, better content , personalized information, and safe browsing
• Increase customer loyalty by customization
• Better operating efficiencies
OTHER SERVICE REVENUE MODELS
• Personal tariffs: user initiates a reverse auction process for user-selected service / content and usage bundle, with a max. price and duration
• Zero-tariff: Zero cost calls and emails with restrictions, balanced with a fixed subscription charge; calls to other networks and roaming overcharged*Case: Softbank Mobile’s purchase of Vodafone Japan and using this model ; goal of 20 % market share; high technical risks leading to KDDI winning….
• Bond service offerings to specific terminals : Nokia (GPS service from Gatefive, Mapping from Navtec, On-line-Music from Loudeye, all acquired); leads to confrontation with operators
LOCATION BASED ADVERTISING
• For GPS / Galileo enabled terminals, or areas where LBS are deployed, advertising push information can be pushed onto users based on their location, when privacy consent has been granted ; highest penetrations of this functionality are US, Japan, Korea
• It is too early to determine which share of consumer LTE terminals will be location enabled, but share in some vertical domains will be high
• “The different components of mobile advertising (including search, display and messaging) are all growing,” with local search dominating driving location-based advertising revenues.
• Examples: Poynt, Yelp, Publicis group , local business advertising specialists Yellow Pages, and vertical aggregators such as Toptable and HotelBooker.
EDUCATING USERS ON LTE DATA USE
• Users must be educated on data use to avoid overspending and chronical addiction
• Operator must help, or see to it that users learn how much data is in their allowance, and how not to go over their limits. In time they will “really begin to understand it," much like going into a gas station to fill up their vehicle.
• CASE Verizon : User feedback to the 5 and 10GB monthly data allowances that come with Verizon Wireless’ new LTE service has been a mystified “What is a gigabyte?” says Dick Lynch, EVP and CTO of Verizon and a key architect of its LTE strategy. “This is a problem that the whole industry will have and I think it’s an important problem to have now,” he states. Mobile operators have a limited amount of capacity to share among all their customers, continues Lynch. Growing data demand each year will push costs in a direction where the flat-rate model of yesterday “is not possible in any realistic fashion”, he warns.
LTE LAUNCH TIMING
• LTE launch timing is a competitive feature which 2 nd tier operators can use to capture customers esp. for vertical applications and enterprise customers
• CASE Singapore operator M1: switched on commercial LTE services in 2009, claiming to be the first operator in Southeast Asia to go live (beating Singapore Telecom and Starhub) . The third-largest operator in the city state has deployed LTE at both 1.8GHz and 2.6GHz, offering theoretical peak speeds of 75Mb/s in the downlink and 37.5Mb/s in the uplink. M1 says these speeds will be upgraded to 150Mb/s and 75Mb/s, respectively, by the end of 2011. The initial launch covers Singapore’s financial district (including Marina Bay, Suntec and Shenton Way), while nationwide coverage is expected in the first quarter of 2012. The operator initially markets LTE services to its enterprise customer base. These customers will be able to access the new network via USB modems on existing mobile broadband plans costing SGD59.40 (US$48) per month. An expanded range of LTE devices, including tablets and smartphones, was introduced in 2011.
• Case Public emergency networks: Harris Corp. Is now offering almost only LTE based solutions
LTE LAUNCH COVERAGE CHOICE
• Acknowledging that in some developed markets fixed broadband, and especially FTTH, may be unbeatable for many stationary uses, some operators choose for LTE launch areas not covered at all (or badly) by broadband, reaping exclusivity very fast
• Sometimes, the regulator has stipulated that operators using LTE allocations must first look to serve areas where broadband is currently limited, before moving on to potentially more lucrative built-up areas
• Case German 800MHz operators: begin deploying first LTE services to areas underserved by broadband
• Case UK operator Everything Everywhere: has partnered with the wholesale arm of BT for the country’s first live trial of 800 MHz LTE services, with the companies using the technology to serve customers in rural Cornwall.
CHINA LAGS in LTE ADOPTION
• China Daily has reported that China, the world’s largest mobile market won’t launch commercial, nationwide LTE services until 2014. Citing comments from the Chinese Minister of Industry and Information Technology, Miao Wei, the report claims that the timeframe will allow maturity of TD-LTE technology, which is still in the relatively early stages of development. The report also cites Miao as stating: “It is obvious that the Chinese government doesn’t want to adopt a 4G service too soon as that would disrupt the carriers’ efforts to develop 3G services” further.
• Although a 2014 rollout would put China a long way behind other mobile markets in terms of LTE progress, in reality it is a realistic timeframe as the country also lagged in deployment of 3G services. 3G services currently make up only 15 percent of the country’s total mobile market.
• All three Chinese operators – China Mobile, China Telecom and China Unicom –are expected to deploy variants of LTE technology as their ‘next-generation’ platform; China Mobile is focused on a specifically Chinese variant called TD-LTE while the other two are likely to deploy LTE based on the FDD variant of the technology.
• There are problems with availability of TD-LTE UE chipsets , and also roaming with gloabl FDD-LTE , 3G and 2 G are not resolved yet
PEAK DOWNLOAD PERFORMANCE SETTING
• Some LTE networks want to launch only when they beat early movers on peak speed
• Example: 150 Mbps : Telstra/ Huawei in laboratory LTE(69.3Mb/s in the field) , using 20MHz and 10MHz of spectrum, in the 1800MHz spectrum band
LTE Evolved packet core (EPC)
• Centralising service and policy management means operators can manage traffic and users in a holistic manner across 3G and LTE networks
• EPC includes the central control plane, with : main repository for subscriber and device information (HSS Home subscriber server) , authorisation and authentification functions(3GPP AAA) , policies to manage network ressources & subscribers (PCRF policy controller), and interoperability support to other access networks (EVDO, WiMAX, WiFi)
• PCRF policy controller applies : tiered network policies (more flexible than just bandwidth caps) , shifts in data across different access networks (i.e. WiFi), application and device policies , subscriber policies (incl. User-defined policies and special offers)
SMARTPHONE and MOBILE MESSAGING HASSLES
• Always on applications such as push email, location , IM , found typically in smartphones, are much heavier (8:1 avg.) in signalling ressources than others with heavier data load, because they continually � ping � the network with or for updates
• Solutions from femtocells and LTE device policy management
LTE BUSINESS ISSUES
• Revolutionizing current regulatory regime to stimulate broadband access towards economic growth and social sustainability
• Realizing profitable new devices and services through LTE• Building and launching LTE in partnership: what are the considerations to be taken into
account? • Network sharing: evidence of a new business reality. Is network co-operation a viable
option for rolling out LTE?• Realizing the objectives of the EU Digital Agenda with the launch of LTE 800 MHz• What are the results of Europe’s First LTE 1800 deployments• The road to convergence of FDD and TDD LTE• What new business models do smartphone & tablet users generate and how must
operators respond?• Enabling LTE notebook connectivity , and LTE embedded devices • Improving the wireless experience and reaching into new vertical markets• Wholesale LTE network approach (USA)• How can carriers make LTE more attractive to consumer electronics companies and to
App developers?
BUSINESS MODEL SPECIFICATION by BUSINESS PROTOCOLS
• For each class of customer-supplier-ecosystem engagement, one can specify the transaction flow and fine-grained functionality needed for an implementation (� business engines �)
• While in 2G / 3G such business protocols were limited more-or-less to authentification and look-up by rating engines in tariff tables, LTE services and applications requires full specifications of the business processes
• Business model specifications can be modeled and instantiated by e.g. UML 2 or MDA using jointly communications and business protocols
1. Application service tiers specified in the Subscriber profile repository (Spr)2. Application server initiates application session3. Application server triggers a policy request to begin quota4. Policy Server (pcrF) performs real-time quota management for each application5. When the application usage limit is reached, the policy server sends a policy decision to the policy and charging enforcement function (pceF) 6. Customers are notified that they have reached their limit and redirected to a portal to get a temporary limit increase or to select the next service tier
PERSONALIZATION: TIERED SERVICES
By combining network and subscriber intelligence with advanced policy management tools, operators can meet the requirements of different customer and market segments with a diversity of personalized service tiers
Linking usage and preferences with payment levels (e.g. time-based tiers, bandwidth tiers, application /location/ QoS tiers, speed-based tiers)
1. Gateway gprS support node (ggSn) signals policy Server upon device 1 session establishment2. Policy Server queries home subscriber server (hSS/HLR ) for the static subscriber information3. HLR sends subscriber profile to policy server4. Policy Server queries the Subscriber profile repository /VLR for dynamic subscriber information5. Subscriber profile repository sends all total and remaining quotas to policy server6. Policy Server installs policies for subscriber on GGSN (per-access point name [Apn] and per-bearer quota grants); GGSN begins tracking usage7. Deep packet Inspection (dpI) signals policy server on traffic detection8. Policy Server installs policies for application control on dpI (per-application quota grants); dpI begins tracking usage9. Device 1 consumes dataREPEAT for Device 2
SIMPLICITY : One Customer – Many Devices
Operators can evolve from device-centric to customer-centric services by providing customers with one plan that spans many devices
Offering multiple identity and device management, per device quota management, etc…
1. GGSN signals policy server about session establishment2. Policy Server queries the Spr/hSS for the subscriber profile3. Spr/hSS sends subscriber information and/or monthly/remaining quota to policy server4. Policy Server installs policies for subscriber on GGSN (bandwidth, quota)5. Deep packet inspection dpI signals pcrF on application detection6. Policy Server installs policies for application control on dpI (application-specifc QoS, entitlements, rating)7. User engages application
OPEN ECOSYSTEM : Adding Value by enhancing Applications
� Over-the-top applications � offer monetization opportunities by enabling operators to enrich and personalize applications with subscriber data profiles and usage data, opt-in’s, presence and location information, payment and rating services, and analytics
1. Policy enforcement point – GGSN, Deep packet inspection, or mobile Internet gateway (MIg) – sees new packet data protocol (pdp) context and asks policy Server for appropriate rules2. The policy Server checks Subscriber profile repository Spr for entitlements; Spr returns “unknown device”3. The policy Server replies to policy enforcement point to redirect the customer to the casual use portal4. User selects day pass package5. The rating engine in the policy server and the Spr are updated6. The Spr notifies the policy server of new quota and other rules7. The policy server instructs the policy enforcement point to allow data under new rules
CASUAL USAGE AND LOYALTY PROGRAMSTime-limited usage access, loyalty points, promotions to modify usage pattern
Many such business models rely upon real-time modifications to the real-time charging system ,but this system can be by-passed by using the rating engine in the policy server
FURTHER READING
• Erik Dahlman, Stefan Parkwall, Johan Sk�ld, 4G LTE/LTE-Advanced for mobile broadband, Elsevier, April 2011, 455 p. , ISBN: 978-0-12-385489-6
• Sassan Ahmadi, Mobile WIMAX, Elsevier , ISBN: 978-0-12-374964-2
• 3GPP tutorials on LTE (made by aWaves,com): http://3gpp.org/Tutorials
ABBREVIATIONS
• AM Application Manager• Apn Access point name• dpI deep packet Inspection• ggSn gateway gprS Support node• hSS home Subscriber Server• MIg Mobile Internet gateway• ocS online charging System• ott over the top• pceF policy and charging enforcement Function• pcrF policy and charging rules Function• pdp packet data protocol• pgW packet gateway• Qoe Quality of experience• QoS Quality of Service• SdM Subscriber data Management• SMS Short Message Service• SMSc Short Message Service center• Spr Subscriber profile repository• VoIp Voice over Internet protocol
The International Standardisation Organization (ISO) beganist work in the 1980s
This work led to design the Open System Interconnection(OSI)
ISO/OSI CROSS LAYERS