Ajay Khanna, CTO, Celcite

Celcite started life as a services company, helping tier one mobile operators in the US with their resource needs. This experience on the front line of a mobile operator’s network operations gave Celcite invaluable insight into what keeps the network operations team awake at night. Networks were becoming increasingly complicated, evolving from being a one-technology one-vendor environment, to being multi-technology and multi-vendor battlefields.

Understanding what was happening, why, and which piece of the network puzzle was to blame was becoming an overwhelming task for the operator’s engineering teams. The time pressure facing engineers to get to problems quickly and fix them so that their customers can have a better experience was a significant challenge.

The usual solution for an operator would be to increase numbers of engineers at the same rate as their growth in data traffic and complexity. However, that would have meant huge pressure on oepx. Operators faced a simple choice – hire more and more engineers just to keep the lights on, or automate processes. With new technologies and new vendors making their way into networks, it became clear to Celcite that that operators were going to need smarter solutions to manage the network more efficiently. It was against this backdrop that Celcite built its customised optimisation and self-performing solution (COPS).

The benefits of a single optimisation system to a mobile operator are clear. There are a lot of disconnected solutions in the network which are generating gigabytes of data, and engineers which benefit from having one single platform or solution to that need to be able to quickly identify the root cause of a problem whenever there is a network issue. By bringing automation into the equation, Celcite understood that the future was in smart tools which help operators do what they need to do with the same number of engineers.

Back in 2006 Celcite recognised that operators needed a single view of their entire RAN operations. But this can make for an extremely complicated picture – you can’t just plug in an out-of-the-box solution, because every operator has different realities and different challenges. A complex, multi-vendor network needs to be stitched together into a single automated self-optimising network, and that requires an intimate understanding of the realities of managing all these different elements. It’s not easy which is why we don’t see many players in this space.

The Celcite COPS solution connects to numerous data feeds, bringing a lot of data – something the company calls Automatic Intelligent Correlation. Celcite believes that this is a big differentiator for the firm; the COPS solution not only brings together all these feeds but also correlates the data, and makes sense out of it.

The fundamental concept was that to be able to manage a network efficiently. A network optimisation engineer has to look at a lot of parallel and interconnected systems; they have to look at the performance data, the configuration data, gigabytes and terabytes worth of data. The challenge is to efficiently get access to all of the data, to be able to do cause analysis and then figure out what’s going on in the network.

Celcite’s solution to the problem is to automate. We started off tailoring the product for GSM networks, before integrating UMTS, and then also a host of different vendors on top of it. This vision to automate the RAN and create optimising and self-performing solutions continues to guide Celcite and points to its future direction – Self-Optimising Networks (SON).

Telecoms analyst firm ARCchart estimates that up to 60 per cent of all tasks performed by a RAN optimisation engineer can be automated. If implemented in full, ARCchart believes, SON can save a typical tier one carrier nearly 37 per cent in OpEx and 18 per cent in CapEx in future RAN infrastructure.[1] Celcite moved into self-optimising networks around a year ago and we recently deployed this solution for an operator in Latin America that it is now seeing some interesting results.

While a SON architecture can be centralised, distributed or a hybrid of the two, the tendency towards multi-vendor environments adds real complexity to the management and optimisation of the RAN. In a distributed SON architecture, where the SON algorithms are run in the network nodes and the nodes exchange SON related messages directly with each other, the ability to work seamlessly across equipment from a range of equipment manufacturers is critical. Without this, SON can end up fragmented and not deliver the promised capex and opex savings.

Celcite focused initially on where its immediate experience lay and looked at solving the problems that operators are facing today in their 3G networks. There has not been a major focus on SON on the UMTS and GSM so far, despite the fact that more than 98 per cent of subscribers are still on these networks. Operators will have to continue to manage them for the next decade and, to be able to manage them effectively they will need to use a SON solution.

Celcite started with SON on UMTS and expanded that onto LTE and GSM—so the very DNA of our approach to SON is multi-technology and multi-vendor.

Terry Greer-King

In the history of bank robberies, the £30 million stolen by the Eurograbber attack in 2012 ranks as one of the all-time biggest, globally. And when you consider that this sum was stolen from more than 30,000 accounts across 30 banks in four European countries, using malware that affected both PCs and bank customers’ mobile phones, it must also rank as one of the most sophisticated thefts ever discovered, writes Terry Greer-King, UK managing director of Check Point*.

But the most worrying aspect of Eurograbber was that it worked within banks’ existing two-factor authentication security, so that – from the banks’ viewpoint – the fraudulent transactions appeared perfectly legitimate. This helped Eurograbber to remain active and undetected for months. So how was it able to do this?

The key to Eurograbber’s success was that the hackers behind the attack had an in-depth understanding of how both consumer and business online banking systems work. The attack specifically targeted the two-factor authentication method using one-time passcodes sent by SMS to mobile devices, and relied on intercepting those text messages so that legitimate passcodes could be exploited.

Attacking on two fronts

What the attackers did was to develop a two-stage attack. The first involved infecting the customer’s PC, and phishing their details. This was done by transparently infecting the customer, using either a phishing e-mail with a malicious link, or by surfing to a malicious link on the web. This downloaded a customised version of the well-known Zeus Trojan onto their PC.

Then, when the bank customer accessed their bank account, the Trojan woke up and launched a fake version of the bank’s web page, containing instructions for ‘upgrading’ the user’s online banking system. As well as asking the user to re-key account numbers and other bank details, it requested their mobile phone details. The page then instructed the user that in order to complete the upgrade, instructions would be sent to their mobile by text.

This was the second stage of the attack. When the user received the text, which appeared to be from their bank, they were directed to complete the ‘banking upgrade’ by clicking on a link. However, doing this caused the Zeus in the mobile  – ZITMO – Trojan to be downloaded. If the user had a BlackBerry, Android or Symbian phone – it was infected.

This completed the circle of infection for the user’s PC and mobile device. From then on, every time they accessed their bank account online, the attack initiated a transaction to transfer money out of their account. This worked by the Trojan on the PC recognising that the user was accessing their account, and sending a request to the bank to transfer an amount of money to the attacker’s ‘mule’ account.

When the bank received that request, generated the transaction authentication number and sent it via SMS to the customer’s mobile device. This was intercepted by the Trojan on the mobile. The Trojan then, extracted the TAN and sent it back to the bank to complete the illicit transaction.

The fraudulent transactions were completely invisible to customers, as they didn’t see the bank’s SMS messages on their mobile phone. And to the bank, they looked like legitimate transactions. The attackers even configured the Zeus trojans to restrict the amount transferred in each transaction to a percentage of the account’s balance, helping them to remain undetected.

So what security lessons can be drawn from the Eurograbber attack? It was certainly successful in exploiting out-of-band authentication methods, in which a one-time passcode is created and sent to a mobile device, which are quite commonly used.

While banks that use other authentication methods were not vulnerable to this specific attack, it highlights the fact that exploits can be developed to target specific authentication systems – and that attackers have the patience and resources to do so.

However, it also highlights the critical role that online banking users themselves play in security. Eurograbber targeted customers, not the banks themselves. So the best protection against possible future attacks like Eurograbber is to ensure online banking customers have up-to-date protection on the network that gives access to their bank, and on the PC they use.

It’s worth reiterating to users that banks should never send an unsolicited email, and so any they get will be phishing mails. Users should be encouraged to use up-to-date antivirus software and a firewall on their home PCs. Cost is not an issue here: there are free solutions from ZoneAlarm and others that deliver protection matching leading paid-for products. These solutions will detect variants of the Zeus Trojan before the user’s PC becomes infected. Another key preventative measure is for users to regularly install software updates on PCs.

There is no ‘silver bullet’ solution that protects against cyber-attacks like Eurograbber. It’s a matter of ongoing vigilance, and ensuring that the security protections used by banks and their customers are as comprehensive, and as up-to-date as possible.

*Check Point, together with Versafe, discovered the fraud

This year, the internet celebrates its 30^th anniversary. Over three decades, the internet has grown to a scale which was hard to imagine in the early days. But as with any technology, the internet is at different stages of maturity around the world. The US and Western Europe enjoy significant user penetration and considerable support from the public and private sectors, with internet even reaching into some household appliances.

Other parts of the globe are catching up quickly – learning from the experiences of other regions, these younger industries are able to skip incremental technology advances, such as the evolution from dial-up infrastructure to broadband to fibre broadband and wifi.

The growth and development of the internet is dependent on dozens of factors, and these are often region-specific. For the Middle East, one of the important issues is capacity, a broad term that includes physical infrastructure, computing hardware, software and human capacity. Building this capacity will be fundamental to ensuring the kind of growth required to bring new regions and users online, while managing the huge amount of data traffic generated by applications such as streaming video. With the fast pace of technology development, building internet capacity is essential to safeguard the future of the internet, and foster local and international innovation.

A closer look at the Internet in the Middle East

The IMF predicts that in 2013, the Middle East will continue to experience economic growth at a rate of 3.7 per cent. But it’s not just enjoying growth through economics – the Burj Khalifa is an example of the sheer scale and ambition of industry in the Middle East, and the ambitions of the internet industry are no less grand, with the sector developing rapidly, and attracting investment and users.

Internet infrastructure and development in the region is a completely different landscape compared to two years ago. For example, the number of RIPE NCC members (also known as Local Internet Registries, or LIRs) based in the region grew nearly 20 per cent in just the last 12 months. A broad commitment to building the internet has helped to decrease the cost of development through economies of scale. Previously it simply wasn’t a financially viable effort for stakeholders to build internet infrastructure, but this is changing, and better, more widely deployed infrastructure has resulted in better access opportunities for businesses and ordinary citizens, and increasing revenues for internet-related industries.

Infrastructure capacity is developing rapidly, with new Internet Exchange Points (IXPs) in the UAE and the Palestinian Territory. These IXPs are of benefit to all parties when utilised properly for peering, and help to reduce overall costs for ISPs, as well as improving latency and bandwidth issues for end users. On the international stage there has been a lot of discussion and recognition of the importance of building local peering relationships, and the recent first meeting of the Arab Internet Governance Forum (Arab IGF) featured the issue prominently in its agenda.

It’s also important to recognise how the Middle East is taking steps to develop the internet through the sharing of knowledge and experience, and actively engaging in multi-stakeholder internet governance processes. In 2012, the success of the first Arab IGF, a region-specific event held in Kuwait and similar to the global Internet Governance Forum, demonstrated the high level of interest from a range of regional stakeholders in Internet governance issues. Planning is already underway for a 2013 event, with a public Open Consultation session scheduled to take place in Dubai this March. These events are an opportunity for representatives from the region (including individuals from government, business, technical & academic community, civil society as well youth) to collaborate and share information, perspectives and experiences.

In a similar vein, the Internet Society hosted its first INET Conference in the region recently in Qatar. The sheer demand and support for both of these events underlines how much the region’s Internet community has grown and how quickly it is maturing.

In addition to these events, the RIPE NCC works closely in support of the Middle East Network Operators Group (MENOG). The MENOG IPv6 Roadshow program, which provides practical, hands-on training for network operators, has seen significant demand from public sector institutions across the entire region. With 13 events held over 2011-2012 and more than 300 participants, The IPv6 Roadshow is helping to build technical expertise that will be vital to the on-going growth of networks in the region. Working closely with MENOG, the RIPE NCC has also been active in building the kind of social and professional networks of peers that are essential to growing human capacity. Combined, these activities create important tools for sharing information and capitalising on the technical talent already based in the region.

These efforts are paying dividends within the region and also on the global stage. One such example is Qatar, a country that has set a strong example in terms of encouraging growth in its local industry, and has been noticed on the international level at global events like the World Conference on International Telecommunications.

Impact

The public sector has played a key role in developing the local internet capabilities. The national governments and regulators are taking a proactive interest in capacity strategies – task forces have been set up in Saudi Arabia, the UAE, Qatar, Oman, Lebanon and Egypt. It’s a tremendous result to see so much support so quickly, and it drives home the message within the local Internet industry that there is high-level support for businesses.

There are positive results from a greater focus on regional peering, and that will improve even further with the launch of the Middle East Peering Forum in March 2013. Local events like this are important for the continued development of the internet in the Middle East as they help to build new relationships and strengthen the networks already in place, and provide an opportunity to share experiences, challenges, and especially successes.

Effectively addressing issues like infrastructure and processes will take time. The region is still building examples of best practice and fostering new intra-region relationships – these must be based around the existing structures and institutions first, before being developed further.

We’re also seeing a range of stakeholders focusing attention on the importance of local language content. Internet content in Arabic is essential, both for industry education, and also for encouraging the general population of the region to use the internet. Google Saudi Arabia now provides local language translating – this may appear to be a minor landmark, but as more Arabic content becomes available, we will see more frequent internet use and deeper integration with the local culture and society. This will eventually lead to the internet changing from a luxury item with niche appeal to an everyday commodity for the mass market.

An opportunity to be world class

The focus has been on public sector at first with the private sector following shortly after. But there must be a collaborative effort by all of the main stakeholders, from governments to Internet Service Providers (ISPs) and beyond. The fact that the Internet industry in the region is still relatively young lends itself to exploring innovative ways for the public and private sectors to work together.

The Middle East faces a big challenge, which is also a big opportunity, to engage its own people and set a precedent for the rest of the world to follow. It can engage with young people and create a new industry invigorated with fresh ideas and passion. The scale of the youth sector means there is a large pool of people to educate and then employ, while not losing the best talent in a brain-drain to the West.

It needs to be made clear to young people that their ideas can have an impact on their local environment, from regulatory policies to seeing new jobs created around the Internet. Young people can change the way the market behaves, and make a real difference at this relatively early stage of the industry’s development. This is in stark contrast to other regions, which have a more mature and established internet with more rigid systems and processes in place.

The RIPE NCC is exploring opportunities to link the Euro IGF and Arab IGF youth sections, which would again help to promote and inspire knowledge sharing. It’s vital that the next generation is passionate and engaged, so they can continue the good work already done. The Middle East has an opportunity to show the whole world how internet resources can be developed, but this can only happen with the involvement of all stakeholders, from government level right through to the average internet user.

Capacity building is crucial to the future of the internet across the region, and it will only happen through the active engagement of both the public and private sectors to encourage young people to participate in the industry and build a long-term future for the internet in the Middle East.

Paul Rendek is director of external relations at regional internet registry RIPE NCC

Mobile voice goes over the top – The current VoLTE market

Global LTE deployments are continuing to rise and the technology is gaining ever more market recognition. However, LTE possesses a key limitation that the industry is increasingly looking to resolve – voice. Even in light of VoLTE launches in South Korea and the United States, the majority of LTE networks are still only able to support data and cannot handle voice calls – instead the user is transferred to a legacy 2G/3G network whenever they want to make a call. This situation is counter intuitive, considering that traditionally, the principal role of a mobile operator is to supply voice services. While LTE networks have been primarily launched in order to cater for the increasing market demand for data services, the omission of voice services has nevertheless left operators in a vulnerable position.

If operators fail to develop solutions that will allow voice calls to be made over LTE networks then they will be unable to decommission legacy networks. This will leave them unable to benefit from the superior spectrum utilisation and cost efficiency that LTE offers over legacy technologies. Equally, this failure would impact on user experience, with call setup delays and unreliability when switching to the legacy network all impacting on the operators’ ability to provide a top quality voice service. In turn, this poor service quality will put operators at risk of losing their position as the primary suppliers of premium voice services, leaving OTT players ideally placed to supersede them in the mobile voice market.

Industry challenges – Quality control for VoLTE

It is undoubtedly early days for VoLTE, and the technology remains largely at the trial stage. Currently, device manufacturers, chipset vendors and operators are all putting VoLTE through its paces. Because of VoLTE’s technological infancy, there is a diverse range of interpretations among mobile operators, in terms of how best to integrate VoLTE in networks and devices. This wide range of different implementations may present a significant challenge to operators in terms of interoperability. Equally, while roaming may be taken for granted with legacy technologies, it is not guaranteed to work for VoLTE unless these interoperability issues can be resolved, and as a result the current expected levels of service quality may be compromised.

Although the industry in general – and the GSMA in particular – is working towards a harmonisation to ensure VoLTE is applied in a consistent way, there is currently no ‘one size fits all’ VoLTE solution for operators. So in order to overcome this challenge operators must undertake a rigorous programme of VoLTE testing. By testing in the laboratory, operators can incorporate a diverse range of variable conditions into their test programmes. Full network roaming capability will eventually need to be enabled for VoLTE, and owing to diverse interpretations of the technology, this will only seek to present further interoperability challenges for the industry. Again, thoroughly testing devices for interoperability in the lab will play a key role in achieving full network roaming capability for VoLTE programmes. Device Manufacturers will need to ensure that VoLTE does not have a detrimental effect on device performance, and that devices are capable of handling VoLTE calls upon their introduction to the market. Regardless of the network infrastructure, mobile subscribers will continue to expect a carrier grade voice service on their mobile device. A ‘best effort’ VoIP type service will not suffice and operators will have to ensure that VoLTE offers excellent levels of quality and performance. If VoLTE fails to provide this level of service then it is liable to gain a negative perception among consumers.

The road ahead – VoLTE takes a test drive

By leveraging lab-based testing, mobile operators, chipset vendors and device manufacturers can make use of a cost effective, simulated network environment to test both component interoperability and overall service quality. In adopting this approach, operators are no longer reliant on live network testing and costly, time consuming device field trials. Moreover, lab based testing can ensure that VoLTE operates entirely as expected, and in turn, this will help to advance VoLTE devices to market and ultimately safeguard customer satisfaction, by ensuring first class levels of service.

Ultimately, VoLTE’s long term success will be determined by its ability to deliver carrier grade voice services across an all-IP network, and on the latest LTE devices. However, a level of cooperation within the mobile industry is vital if VoLTE is to emerge as a commercial viability. The speed at which LTE can be deployed and its level of service quality are all inextricably linked to the evolution of testing; as well as the desire amongst operators to consolidate services on LTE and eventually migrate all of their subscribers to LTE, freeing up the spectrum that  is currently taken up by legacy technology.

Paul Beaver, Products Director at Anite

Clayton Locke is CTO at Intelligent Environments

The banking industry, integral to our commercial and personal lives, has always evolved with the times to embrace new challenges and consumer attitudes. Technology plays an obvious and increasingly important role in this evolution, writes Clayton Locke, chief technology officer at Intelligent Environments.

Inventions such as the ATM and credit cards launched in the 1960s, internet banking services in the 1990s and now mobile banking and payments, have all fundamentally changed how the work of banking is done. A major driver in banking industry change is the consumer demand to be better connected to their money. This demand is now supporting a new breed of digital banking services that is coming to the fore. How can banks benefit from the new types of customer interaction enabled by digital serices; and how will banks stave off competition from more digitally-advanced retail and telecoms companies?

Eric Schmidt, executive chairman of Google, said recently that “everything significant we are working on is around mobile”. This statement rings true for the banking industry. There is increased attention being put on mobile financial solutions that can be used by consumers whenever they want and wherever they are. It is a form of technology that will become more prevalent and critically important to banking over the next three years.

A poll carried out in November by mobile advertising company Verve Mobile, showed that 63 per cent of US consumers put the smartphone as their overwhelming platform of choice for banking. The desire for mobile-led banking solutions is already playing a major role in vital aspects of everyday consumer life – something that will not slow down. Near Field Communications devices, for example, are now being trialled at high profile events in the UK. There is been a steady uptake of mobile banking solutions amongst UK consumers and the number of registered mobile banking users is expected to treble by 2015. Yet despite this demand and the initial success of mobile payments and banking solutions, banks are still failing to maximise the true potential of these transactions.

The challenge many banks face is making their mobile solutions truly useful for their customer base. Mobile banking represents a new way of interacting with banking customers. Where desktop based internet banking moved the relationship from the branch to online – mobile takes it on the move. Banks must now connect money to people through a channel determined by the customer. Retailers and mobile operators have made significant strides in changing their business models to take advantage of these new opportunities. There are lessons that banks should take from the success of these sectors to ensure similar, high value propositions can be adopted by the banking sector.

For example, retailers have used mobile as a key to unlock a treasure trove of information about customers’ individual needs, harnessing this information via a joined up proposition that creates bespoke offerings direct to a customer’s device. The technology enables consumers to remain always connected, always on, when it comes to their relationship with their bank.

Consumers increasingly demand an end-to-end experience and greater consistency when accessing their bank accounts via their mobile, their iPad, their PC, or even their Smart TV.

Modern banking is about connecting people to their money more quickly, accurately and efficiently than ever before. As banks begin to place the focus more firmly on what customers want from mobile, banking will evolve a very different business model from what exists today. The banks that become the earlier adopters of this new technology will undoubtedly be best positioned to lead the industry forward.

http://www.intelligentenvironments.com/

OTT services have grown in popularity in recent years thanks to the rapid uptake of smartphones and other mobile devices such as tablets, simultaneously occurring with a social media boom. The growing number of channels and tools for communication means that an SMS over a cellular network that needs to be paid for has – for some time – not been the only option for customers to message one another. In March 2012 OTT provider WhatsApp announced that it had hit the two billion messages per day volume worldwide, just five months after reaching the one billion mark. Considering this pace of growth, it is essential CSPs act now to effectively manage the risks being posed.

Offering content beyond the norm

To take advantage of this opportunity some CSPs may look to launch their own OTT services, a good example being Virgin Media’s recently announced “SmartCall” application, which not only defends against OTT providers but helps grow a declining revenue stream. Using the application, Virgin Media’s home phone customers can make calls from mobiles over a wifi connection, regardless of their location (even if they are abroad) using minutes from their landline bundles. This application not only helps Virgin Media differentiate itself from competitors by providing a service others are not, but the innovative offering will drive demand for Virgin wifi access and home phone deals, which in turn can increase revenue gains as customers upgrade their packages.

However, if CSPs choose not to offer their own OTT services, there are many benefits to be had by working with, rather than against, OTT providers, such as increased brand affinity and positioning themselves as front-runners within the telecoms and mobile applications space. If third party developers see that CSPs are supporting OTT providers it is more likely they will partner with CSPs to offer new and innovative applications in their own stores rather than only for external markets, such as Amazon’s Appstore. This is something CSPs are increasingly looking to do to help capitalise on the mobile application boom. If successful, CSPs will generate a new revenue opportunity to optimise on the back of embracing OTT services.

Embracing OTT providers

CSPs can also turn to OTT providers to launch new and personalised offerings, which deliver increased customer satisfaction and new, varied revenue streams. By partnering with OTT providers, or content providers such as newspapers, to offer services, CSPs will generate new revenue streams, while gaining access to an increasing amount of customer data allowing them to personalise their offerings accordingly.

For example, some smartphone users use mobile applications to identify certain songs played during television programmes and commercials. If a CSP were to partner with such an OTT provider, they could offer the customer the chance to download the track being played at a discounted rate over their cellular network, or even over wifi. By striking up the necessary partnerships, CSPs could own the billing for such a purchase, meaning however it’s downloaded, there is a revenue opportunity for them.  The whole process will also be faster and more convenient for the customer, offering a better experience and increasing stickiness. In addition, CSPs creating such partnerships not only build a new service to monetise, but will also be able to develop an insight into their customers’ music tastes. This can be used to flag the latest releases by certain artists and the opportunity to download exclusive tracks and add the cost to their monthly bill, all of which will help further increase customer satisfaction and loyalty.

Standing out in a crowded market place

Many of the handsets CSPs will be offering on their networks in the coming months will no doubt be designed to run specific OTT services. For example, Nokia’s latest set of devices that run on Microsoft’s Windows Phone operating system will offer Skype out of the box, and it will be interesting to see how CSPs react to this as they negotiate carrying the handsets. CSPs that accept the offer of such services will have access to yet more customer data, enabling them to further enhance the customer experience, and grow revenue streams. By forming exclusive partnerships that accept the potential risk as well as the rewards of running third party OTT services, CSPs may also be able to differentiate themselves from competitors by being the only providers selling that particular handset, as we saw with O2 and the iPhone in the UK when it was first launched.

To optimise the increasing volume of customer data delivered through embracing OTT services, CSPs must ensure their back-end infrastructures are capable of delivering detailed insight into how customers are using the network, as well as which users are using OTT services most heavily. They will need a flexible billing system capable of bundling all customer information and charging them efficiently to improve the customer experience, effective analytics tools capable of processing customer data so that it can be actioned accordingly, and an order and design solution allowing CSPs to rapidly launch new offers and services to market – some of which are beyond CSPs’ traditional pricing models – in response to patterns it is seeing in its customer data.

Combatting the threat

One thing CSPs should avoid is blocking or limiting access to certain OTT services, which is what some are doing according to a report from the Body of European Regulators for Electronic Communications. The study found that up to 50 per cent of people in the European Union (EU) are locked into broadband and mobile broadband contracts that permit operators to limit access to VoiP or file sharing services. By limiting access to these services, CSPs ensure that users pay for their use of the network when using OTT services.

Blocking services will prove to be unsustainable for CSPs in the long run. Recent research from Rebtel claimed that over half of UK smartphone users are unaware that CSPs block or limit access to OTT providers, while almost 60 per cent of the UK’s total smartphone users would switch networks if they knew services were being blocked. This approach has the potential to significantly damage customer loyalty, and in an age where customer experience is king, CSPs simply cannot afford to take that risk.

Remaining relevant in the telecoms space

CSPs realise that failure to address the challenge of OTT service providers will result in their revenues from cellular network activity shrinking. As a result, they must fight to remain relevant to their customers and embrace and enhance OTT services that the majority of their customers want to use. Innovative OTT services will continue to enter the market in the coming years and their popularity will surely increase as 4G networks are rolled out, and the number of activities that can be done on the move hits new levels.  It is critical CSPs apply these learnings to their processes to remain relevant, boost their offerings and make full use of the resources available to them, such as the increasing volume of customer data. In doing so, CSPs will improve the customer experience while creating new and innovative revenue streams and trusted partnership models that allow them to take their fair share of the revenue available; something they have missed out on too often up to now.

Gordon Rawling, Senior Marketing Director, Oracle Communications EMEA

Is the clock ticking?

Earlier this month, I attended the Spectrum Management Forum 2012 in Munich and was interested to hear several presenters criticise the Combinatorial Clock Auction (CCA) format. The CCA format which has clock and supplementary rounds where bidders bid on indivisible packages of spectrum and where prices paid are determined by a second price rule has in the last few years found increasing favour by many governments for spectrum auctions.  Under the second price rule, the price a winner of a particular package pays for its spectrum is determined entirely by competitors’ bids.

Supporters of the CCA format, claim that it results in more economically efficient outcomes and reduces aggregation risk where there may be complementarities between lots e.g. between high and low band spectrum.

Most of the criticisms of the CCA format relate to the fact that it is incredibly complex to prepare for, that the outcome is not very transparent and it can lead to perverse results. But there are other issues that for instance competitors can “game” the system and drive up prices paid by other bidders by bidding on larger packages that they do not sincerely want to win. In addition it represents a difficult issue for companies to deal with from a corporate governance point of view in terms of establishing bid limits and deciding whether to bid sincerely.

We can confirm that complexity is a serious issue as one CCA auction that we have been involved in required our client to value more than one hundred thousand different spectrum packages to prepare for the supplementary round. In terms of strange results there have been several auctions where there have been very large disparities in prices paid e.g. the 2012 Swiss multi-band auction and the 2010 Danish 2.6GHz auction.

We have worked with most major auction formats and while CCA was introduced with good intentions we are starting to doubt that the benefits outweigh the disadvantages.

Scott McKenzie is director at Coleago

Yves Martin, Orange

In recent years we have seen networks and devices evolve to offer customers faster and more reliable data services than ever before. Customers have become accustomed to accessing their photos, playing games and watching videos and much more from their smartphones in their home markets. Despite this, when it comes to international roaming, only a small proportion of consumers are enjoying these services when they are abroad.

As of June 2012, only 30 per cent of our customer base is currently using data when roaming (almost 80 per cent of consumers are using data domestically) – although this is a 60 per cent annual increase in data roaming services. This market is growing rapidly, demonstrating the appetite for such services.

The operator opportunity to grow the international data roaming market and deliver affordable data roaming services so that more of their customers’ can enjoy these services is clear. To unlock this potential however, operators need to tackle the barriers – real and perceived head-on and focus on continual improvement of the customer experience – making it clear, affordable and easy. Innovation, therefore has never been more important.

However, convincing customers that using data services abroad is affordable is one of the biggest obstacles operators face, despite the reality that prices have decreased by 50 per cent in our own experience in the past year due to a combination of innovation and regulation. We believe that there are further opportunities for the industry to be bold and creative to overcome this challenge.

As one of the first operators to offer roaming bundles back in 2009, Orange has placed innovation at the heart of its roaming offers. We have championed a segmented approach that meets the needs of a variety of usage patterns from the occasional to the frequent roamer and the business user. Starting out with voice roaming bundles, over the years we have extended these to data as the market evolved and this year rolled out our ‘combined’ bundles across Europe, incorporating data, voice and text in one, simple tariff.

Whilst operators have a duty to continue to drive down the cost of accessing data when abroad as the market matures and we would expect innovation in pricing to continue, there is much scope for innovation in other areas.

There is no doubt that empowering the customer with information and knowledge about accessing data abroad most be a focus for all operators. This in itself provides great scope for innovation particularly in developing consumer-facing tools to educate them, demonstrate transparency and in turn, encourage greater usage.

To this end Orange recently re-vamped its Orange Travel website to act as a central hub for our customers across the world, enabling them to access information on Orange’s roaming services. It includes an animation targeted at consumers providing guidance on what to do before going abroad and what to do when they are abroad, including accessing wifi networks when available.

Earlier this year, Orange launched the ‘Orange Travel App’, which helps customers track their data usage whilst travelling anywhere in the world. Customers can easily monitor in real-time their data and SMS roaming traffic and can then compare this within the app to their local tariff plans to ensure that they are within their limits.

In both cases, the aim is to educate and empower our customers so that they are able to get the most out of their phones whilst travelling abroad. On one hand this encourages consumers to use roaming services, but on the other, it also helps removes some of the associated and perceived cost barriers. We believe that by implementing such schemes the industry can proactively demonstrate its leadership in overcoming these obstacles.

Orange believes that its innovation has had a direct impact on the growth in data usage abroad we’ve seen – an increase of 131% from 2009 to 2011. Overall, we have added over one million new roaming customers in 2011, bringing the total up to 25 million Orange Travel customers.

We are convinced that innovation in all areas will be key to operators’ success in untapping the potential in the market and will continue to be important when the the European Commission’s structural solution comes into force in 2014. From an operator’s point of view, we recognise the industry’s concerns around the proposed structural changes intended to pave the way for greater competition. Indeed having new players in an industry can be interesting and can bring new opportunities such as the case with the introduction of low-cost airlines 15 years ago.

However in an international roaming context, the business case for a new player is limited given that the roaming retail tariff will be at least halved by 2014, so the European Commission’s desired effect of delivering even greater competition may not be realised. For now though, the priority for existing operators should be to open opportunities by removing the real and perceived barriers by customers thereby regaining their trust.

For roaming to be successful, the industry must approach innovation beyond regulatory requirements to ensure that we have a sustainable, long-term roaming proposition for consumers.

The future is exciting for customers and operators alike if innovation in roaming continues to flourish. Data roaming in Europe has never been more affordable and as an industry, we have a duty to highlight and make this available to more customers than ever before.

Yves Martin is the Vice President of Roaming at Orange
The Orange Travel website can be accessed at: www.orange.com/travel

Though this was a European study, the fears exist throughout the operator community around the world. And the figures strike me as being on the sensationalist side of things, but there’s no doubt that this is a trend that needs addressing and reversing.

Yet a new challenge for operators has emerged in recent weeks that brings this threat into sharp focus. With the launch of iOS6, Apple’s peer-to-peer video calling service – FaceTime – is available on 3G and 4G cellular networks.

iOS6 is already on more than 100 million devices, a fair proportion of which will have access to cellular networks. That’s a lot of mobile users that could start FaceTime sessions on an operator’s network. And this is very early days.

If the number of iOS6-enabled devices out there continues to increase as projected, and FaceTime grows in popularity, we could finally see mobile video calling take off. As a mobile service it has failed to establish itself so far, but the influence of Apple and the inevitable increase in marketing of similar services from competitors could see the service take off and become a mainstream proposition.

What does that mean for mobile operators?

Worst case scenario, it means an increase in data traffic on their network, with little corresponding revenue, and a decline in usage of their own traditional telephony services.

Those on the infrastructure side of the mobile industry have been have been working to augment network capacity and speed to meet this threat, but is enough being done? And which are the areas of the network that will be under the greatest pressure?

Perhaps a more important question, which components of the network will allow operators to not only manage the increased traffic, but also to grow revenues, either directly from OTT services, or by capturing the associated trend?

The following network elements will be crucial to operators’ continued success in this new environment when the services on their network are rarely their own:

Small cells: By providing massive increases in capacity, small cells are by default a key tool in managing the data crunch. Additionally, small cells are increasingly multi-mode with support for 3G, LTE and WiFi in a single device. This presents a great tool for operator-managed service partitioning. With this capability, operators could actively choose to move FaceTime traffic to WiFi, 3G or LTE based on congestion issues, ensuring the optimum user experience for all on the network.

Serving Gateway: Acting as the anchor point for the core network makes the SGW the workhorse of the LTE network. Being the anchor point means the SGW must be capable of managing mobility as a FaceTime user moves through the network. This is a very different scenario to a user downloading emails and a significant amount of capacity is required.

Packet Gateway: The packet gateway provides connectivity between the device and the external network where the video server resides, but that is not it’s only job.  The PGW can perform a number of additional tasks including policy enforcement, packet filtering, billing and potentially lawful intercept.  As a result, these platforms must be capable of doing some heavy lifting with a lot of packets.

DPI Platforms: LTE, due to its increase in available bandwidth, will carry a wider range and volume of services (such as data, voice and video) than any previous architecture. In order to be more effective, LTE will require DPI-based network probes capable of providing real time data for the PCEF. The DPI platforms, due to the significant increase in data traffic, must be capable of detecting more information, and at faster speeds, than ever before.

ePDG: One way to help off-load the macro-RAN network from high bandwidth applications such as FaceTime is the utilization of Wi-Fi and small cell networks. However, some deployment scenarios of Wi-Fi and small cells use untrusted access between the subscriber and the core network. In these types of untrusted scenarios, the ePDG becomes of significant importance to the operator it must handle high-bandwidth traffic and provide vital security for the user.

IMS Media Resource Function: They say the best defence is often a good offence. That is why mobile operators are accelerating their deployment of VoLTE and RCS services to generate their own service revenues over their LTE broadband infrastructure, to compete with OTT communication services like Facetime, but with improved interoperability. VoLTE and RCS video chat, video share, and multimedia conferencing services are all based on IP Multimedia Subsystem (IMS), and platforms that deliver the audio and video media processing power to make all these VAS services  scalable. Eventually, a Media Resource Function will also play a role in providing video interworking gateway services between FaceTime and non-FaceTime video endpoints, to achieve ubiquitous real-time multimedia communications.

The challenge for operators is most definitely two-fold. Simply managing the increased volume of third party traffic on the network will not be sufficient to halt the revenue declines that the Telco 2.0 research highlights.

Operators must keep traffic costs down to retain margin on data volumes. But they must also use the same infrastructure to maximize revenues. This means offering outstanding quality of service to subscribers that drives data usage and, in turn, revenues from tiered tariffs.

It also means using that QoS to encourage adoption of new services. Services enabled by platforms that can deliver the sort of premium voice and video experiences that subscribers are willing to pay for.

In a survey that we conducted in 2011, service delivery and innovation was a major concern of operators. They must overcome this concern. Without the approach to manage capacity and increasing service innovation and delivery, operators face declining revenues, declining margins, and increased marginalisation in a mobile industry dominated by consumer brands of devices, apps and services.

Manish Singh, Radisys

“At the time it didn’t seem like a big deal,” explained Neil Papworth, the twenty two year old British engineer, after sending the world’s first ever text message back in 1992. Almost 20 years ago to the day, Neil marked his place in history, revolutionising communication as we know it, all by sending a text message that read “Merry Christma.” The elegant simplicity of this message soon went on to define the very nature of the platform which has grown to become a cornerstone of mobile communication in the 21^st Century.

In the beginning, SMS was seen as a clever way for an operators’ employees to send simple messages to one another and at the time, the industry knew little about the impact this technology would have on billions across the globe. Although the first text message was sent in 1992, it was only a year later in 1993 when the first commercial deployment of a short message service center (SMSC) was installed by Aldiscon, now part of Acision at Telia (now TeliaSonera), in Sweden and the first commercial SMS was sent.  However, mobile messaging did not become commonplace until the early 2000’s. UK mobile users now send, on average, 50 texts a week, according to the Mobile Operator Association.

The evolution of text messaging over the past 20 years has been simply staggering. With a potential reach of more than five billion people across the globe and an impressive 98 per cent of messages being opened and read, text has grown to become the leading personal messaging service in the world which is used by all demographics and age groups. The latest figures from Ofcom’s annual communication report show that usage surpassed voice calling for the first time in its history, and with UK mobile users alone sending over 150 billion SMS messages in 2011, an increase of 17.3 per cent YoY.

But why text? And most importantly, why is it still popular today? This is something that can perhaps only be answered through a deeper psychological understanding of the human mind. According to internet-enabled communication expert and psychologist Graham Jones, running in the back of the people’s thoughts is the need to do everything with the least possible effort: “We instinctively search for the easiest way to communicate.” From its very inception, with the effortless yet perfectly apt message, “Merry Christma” (the ‘s’ was missed off), text messaging has grown to embody communication in its simplest form. In fact, the notion of SMS simplicity actually predates the medium itself.

In 1985, researcher Friedhelm Hillebrand was thinking about adding a text messaging service to the nascent cellular telephone system. In doing so he typed various statements and brief messages onto a typewriter and discovered that all messages fit within 160 characters, which went on to define the very nature of the medium – Short Messaging Service (SMS).  The length that Friedhelm deemed “perfectly sufficient” for all communication purposes also formed the basis for the wildly popular social network Twitter – demonstrating yet again that simplicity is key!

Even with the rise of Over-the-Top (OTT) and Instant Messaging (IM) services, industry experts believe SMS revenues will continue to increase globally, estimating that mobile networks will earn $726bn from SMS over the next five years (Portio Research). Interestingly however, the service has remained fundamentally unchanged since its inception and the ubiquitous nature of SMS amongst other factors have contributed to its success: reach, reliability, speed, ease of use and its open rate. Such attributes have helped to give SMS a dominant status, yet with the current mobile messaging landscape developing at an impressive rate, remaining relevant and enriching the user experience is key to co-exist in today’s mobile world.

In order to continue to carve a clear role in messaging 20 years on, it is imperative that operators fully leverage the huge opportunity they have to enhance mobile messaging and deliver a service not only for text but for instant updates, notifications, social chat, file transfer, presence and connecting social networks.  As experienced service providers, with a solid customer base, reputation of trust and quality, as well as insight into user behaviour, operators are in a unique position to leverage existing assets while integrating new messaging services into their offering that resonate with the user.

As consumers adopt new messaging applications, we are witnessing a clear appetite for services that enhance and enrich the messaging user experience, which is supported by our own messaging research.  Questioning 1,250 smartphone users about their messaging requirements (from the UK and US), respondents were asked about the attractiveness of a new operator-based service that provided SMS/MMS/IM/group chat and file/video sharing that reaches all mobile users across all devices and networks. Over half (52 per cent) stated they would use such a service, with just five per cent stating they would not use it at all. Even in the younger age bracket of 18 to 34 years, where OTT apps are most prevalent – 60 per cent of smartphone owners stated they were highly interested in such a service from their mobile operator.

When asked what this messaging service should look like, top requirements were related to service characteristics. Price, already identified as the main driver to OTT service uptake, was also the number one requirement for adoption of new rich messaging services, including lower price compared to the existing service (63 per cent) and service included in package (57 per cent). Additionally, Quality of Service was key, corresponding to strengths of SMS including reliability (50 per cent), instant delivery (45 per cent) and ability to reach everyone (42 per cent).There was also a clear need for enhanced messaging features including: support for multiple devices (35 per cent); content sharing (32 per cent); live typing indication (24 per cent); conversational view (24 per cent); group chat (18 per cent) and status sharing (14 per cent).

Irrespective of platform, the research shows that mobile users require a service with the universal reach and uncompromised Quality of Service expected from their operator, but also with enriched features. Alongside this, there is a huge untapped opportunity for operators and brands alike to leverage SMS as an engagement platform. SMS has the greatest reach of all connectivity channels and is one of the most trusted mediums of communication. It enables enterprises to reach out to and engage with mobile users, customers and employees, with reliable delivery and a 99.9 per cent guarantee of being read almost immediately. For consumers, receiving a text gives them the control to whether they decide to opt-out or action it, making the experience feel personal.  The challenge brands face is to ensure they provide a highly targeted and relevant service to generate a positive response. Even two decades on from its inception, enterprise messaging, is a relatively immature and unexploited route. However, if intelligently used SMS as an engagement tool – one of the only engagement channels left unexhausted – it could be the biggest winner of them all.

Nobody can deny the incredible success SMS has enjoyed since its birth in December 1992. The medium quickly grew to become the trigger for the messaging world we know today and it must now evolve in order to remain relevant tomorrow. Text messaging not only continues to flourish it stands as a communication platform accepted by all, with a unique simplicity. While market uptake of OTT messaging has been augmented by perception that such services are free, these rely on a data connection and without SMS to fall back on when connection is down, they risk a perception of service degradation. If operators can successfully combine the reach, reliability and simplicity found in SMS with a rich user experience offered by new OTT applications – this presents a powerful opportunity to shake up the messaging space and ensure ownership of it by embracing standards such as the GSMA’s Rich Communication Suite (RCS) initiative.

So, we must say, “Happy 20^th Birthday SMS” as we now look to what can be done to evolve and enrich this successful communications channel. You never know, we maybe celebrating the 40^th anniversary of SMS and messaging with a bang in 2032.

Jorgen Nilsson, CEO at Acision