Sanqi Li, Huawei

The CTO of Chinese equipment vendor Huawei clearly envisions a world where network applications and services will run on commodity hardware and software. For a company that sells specialist boxes into networks, this could be a bold statement, but Sanqi Li, CTO of the firm’s carrier network business, simply sees it as the evolution of business models for both carriers and vendors.

Speaking about what he calls the “new digital economy” Sanqi believes the next generation of technology, particularly virtualisation, will bring about more change than the industry has seen in the last 100 years, especially in terms of business models. While he acknowledges that the operator is already the foundation stone of all connections, he argues that operators need to move beyond what is traditionally perceived as their position in the digital ecosystem.

“This next change is less about technology and more about business. The operator business model at present is rigid, slow, and hard to change. Network architecture today is closed, complicated, and still focused on elements that the carriers can control,” Sanqi says, alluding to the idea that telcos should be partnering with OTT services using technologies developed by the vendors. Indeed, with an assertiveness that some of his competitors might be wary of displaying, he adds: “Vendors are increasingly responsible for the operator business model.“

Sanqi believes that the existing TCO structure for network operators is not sustainable, because opex is still growing and is now at 82 per cent, up from 77 per cent ten years ago.

“We’re looking at the fundamental limit of existing network infrastructure,” he says. “Today’s network architecture is closed, protocol-centric and vertical, fragmented and with software embedded in the network devices.” The devices might be in the network for ten, 15 or even 20 years and all services are best effort with very little differentiation between them, he adds. Networks are over complicated by the continuing presence of two decades’ worth of technology, from TDM to ATM,  and frame relay to IP and MPLS.

“These networks are multi-generation and multi-technology, and control is always at the centre of the model. Voice and messaging are all controlled directly by the operator, but this traditional service model cannot be sustained because it’s slow to adapt,” he warns.

A business model that is rigid, slow, and hard to change, can be saved by the core virtualisation expectations of SDN (software defined networking), he says. He characterises the move to this new architecture as a move from closed to open; rather than having a network that scales up, it’s about having one that scales out, across different sectors and verticals, while enabling new network capabilities.

“It’s about stopping the operators from having a controlling mentality and giving them an enabling mentality. Then the telcos’ true capabilities in network, QoS and billing can really come into their own,” Sanqi says.

Huawei, which caters to cloud service providers as much as it does traditional telcos, is talking about bringing cloud business technology into the telco network, using SDN to dynamically allocate resources and spectrum across 2G, 3G, and 4G as well as to provide a virtual gateway direct to the customer’s home.

In terms of the core technologies, Sanqi talks about Network OS, which decouples the control layer from network devices, as well as Cloud OS, which deals with massively distributed datacentres, virtualisation and automation. The combination of these two OSes, touches every part of the network and structurally optimises it.

Sanqi reckons that decoupling, or ‘abstracting’ the control layer can reduce the time and effort needed to manage network devices by a factor of between five and 20. “Abstraction in the cloud layer can lead to simplicity, where providers can automate and orchestrate new services and apply different cost strategies,” he says.

It’s a big shift for an industry that has historically built networks around specialised appliances and one that will need critical mass from the vendor community before the carriers buy into the idea wholeheartedly. But Sanqi says that this approach does not mean moving everything to x86 hardware and argues that it would not have a detrimental effect on Huawei’s business as a maker of both network hardware and software. SDN and virtualisation means network functions are no longer embedded in devices, with control becoming more of a software-based model, breaking away from a costly status quo in which controllers for many remote devices are run vertically, he says.

“More and more hardware shipments will be focused on data centre boxes, the likes of which Huawei sells. These are not just x86 processor boxes, but those that might also require GPU power for video rendering,” he says.

In terms of architecture and software, OpenFlow is expected to be the chosen switching specification, while the Cloud OS will be based on OpenStack. Huawei is building a centralised routing control algorithm and the network OS is still to be decided on, but a key feature is that it decouples control from the devices themselves. The company already has SDN-enabled routers deployed alongside OpenFlow-tested equipment, Sanqi says.

Moreover, an increasing proportion of Huawei’s future product development will be in software, as network functions, no longer embedded in specialist network devices, will all be controlled by software that needs to be open, abstract, programmable and virtualised. How long this process will take is anybody’s guess, though, as represents a move to an entirely new business model.

“Carriers won’t swap everything out at once. This is more of a migration and needs to be managed carefully as it can touch all parts of the system. But the endgame is that carriers are looking for programmability in software to open up the capability to work with OTT,” he says.

Small cells are seen as a key growth area

Testing, measurement and security firm JDSU on Friday acquired geo-location and RAN planning specialist Arieso for $85m in cash.

JDSU will absorb Arieso’s product line to boost its portfolio in helping operators to address the rapidly growing deployment of small cells and challenges associated with limited spectrum capacity. Arieso’s location offerings store and analyse data from billions of mobile connection events that translate into intelligence to help optimise network performance, improve customer experience and create new revenue-generating services.

Indeed, the Telecoms.com Intelligence Survey 2013 found that small cell offload was the most popular technology consideration for operators over the next 24 months with 60 per cent of the almost 2,000 respondents rating it as ‘important’ or ‘very important’.

The RAN optimisation and self-optimised networks (SON) markets are expected to grow from approximately $700m today to more than $1bn by 2015 and Arieso’s bookings for calendar 2012 were approximately $27m, the company said.

Listed in the Telecoms.com’s Industry Leading Ladies supplement in 2010, Shirin Dehghan, an engineering graduate founded Arieso in 2002. She started her career developing radio propagation products for a UK startup, before joining Vodafone as a research engineer.

At Vodafone she was responsible for the development of WCDMA simulation and business modelling and served on Vodafone UK’s 3G auction team, where she provided technical input to the UK board.

The idea is to take a network appliance and run it as software on servers, storage and switches

Of late there seems to be an SDN (software defined networks) related announcement every few days, as vendors get their ducks in a row to pitch the next evolution of technology to carriers at MWC. But the concept demands a change in mindset for the vendors as much as it does the operators.

Speaking at the launch of the company’s SoftCom SDN platform last week, Sanqi Li, CTO, carrier network business group at Huawei, waxed lyrical about the core virtualisation expectations of SDN, which will see network applications and services run on commodity hardware and software. As a maker of both network hardware and software, this approach will have an effect on Huawei’s business, but not a detrimental one, Sanqi said.

“More and more hardware shipments will be focused on data centre boxes, the likes of which Huawei sells. These are not just x86 processor boxes, but they might also require GPU power for video rendering,” he said.

It’s a big shift for an industry that has built networks around specialised appliances and likely needs critical mass from the vendor community before the carriers buy into the idea wholeheartedly. Yet the telcos already have one cheerleader.

Don Clarke, head of network evolution innovation at UK incumbent BT headed up a recent study to investigate the potential of using commodity equipment for network services and found that, not only did it match specialist gear in terms of performance—it could actually be more advantageous.

“The idea is to take a network appliance and run it as software on servers, storage and switches. Of course, it’s easier to deploy software images than it is to deploy hard boxes, but you can also apply resilience concepts that do not even exist in hardware, as well as it making testing and service assurance easier,” Clarke said.

Clarke is heading up the technical working group of the recently inaugurated ETSI Network Functions Virtualization (NFV) forum, which will focus on implementing network functions in software that can run on a range of industry standard server hardware, and that can be moved to, or instantiated in, various locations in the network as required, without the need to install new equipment.

But the key finding of BT’s investigation is that in order to do this properly, the industry needs standards.

OpenFlow is expected to be the chosen switching specification, while the Cloud OS will be based on OpenStack. Huawei is building a centralised routing control algorithm and the network OS is still to be decided on, but a key feature is that it decouples control from the devices themselves.

Sanqi said that a big part of Huawei’s product development will be in software, as network functions no longer be embedded in specialist network devices will all be controlled by software that needs to be open, abstract, programmable and virtualised.

“Carriers are looking for programmability in software to open up the capability to work with OTT,” he said.

“This next change is less about technology and more about business. The operator business model at present is rigid, slow, and hard to change. Network architecture today is closed, complicated, and still focused on elements that the carriers can control,” Sanqi said, alluding to the idea that telcos should be partnering with OTT services using technologies developed by the vendors.

“Vendors are increasingly responsible for the operator business model,” he added.

SDN World Summit, takes place on 11-13 June 2013, at the Fira Palace Hotel, Barcelona

SDN is many things to many people

As traditional, and even more modern, network architectures struggle to cope with more dynamic applications and services, another acronym has emerged as a possible answer to operators’ challenges. But ask ten different industry pundits what SDN (software defined networking) means and you will likely get ten different answers. At the time of writing, telecoms.com had just published a poll offering a variety of definitions, the clear leader of which was “other”—effectively meaning something else not on the list.

To some it’s a concept, a system architecture or even an implementation of technology, to others it merely means the OpenFlow protocol used to configure the forwarding plane of a network switch or router over the network. Then again, some see it as a process of virtualisation—the creation of an abstraction layer between software and hardware in the network.

This last point is one many can agree on. Telecoms networks typically contain a variety of proprietary hardware solutions that have grown in number over time, as new network services often require additional kit, and the integration and deployment of these appliances is getting harder to do.

Meanwhile hardware life-cycles are becoming shorter as innovation accelerates, reducing the return on investment of deploying new services and constraining innovation.

SDN and the virtualisation of network functions aims to address these problems by evolving standard technology to consolidate many network equipment types onto high volume servers, switches and storage—essentially running the virtual applications on commodity hardware.

This is the task standards body and industry specification group ETSI set out to undertake in January, when it proposed to develop an architecture for the virtualisation of various functions within telecoms networks.

The initiative is led by seven operators; AT&T, BT, Deutsche Telekom, Orange, Telecom Italia, Telefónica and Verizon; which have been joined by 52 other network operators, telecoms equipment vendors, IT vendors and technology providers to create the ETSI Industry Specification Group (ISG) for Network Functions Virtualization.

ETSI will focus on implementing network functions in software that can run on a range of industry standard server hardware, and that can be moved to, or instantiated in, various locations in the network as required, without the need to install new equipment.

Potential benefits include reduced operator CAPEX and OPEX; reduced time-to-market; improved return on investment from new services; greater flexibility to scale up, scale down or evolve services; openness to the virtual appliance market and pure software entrants; and opportunities to trial and deploy new services at lower risk. The first specifications are expected before the end of 2013. When we spoke to Ulf Ewaldsson, CTO of Ericsson, in October 2012, he said the explosive growth in cloud technology was spurring the requirement for SDN specifications—a view reinforced by a recent Ovum report. As the three-tier hierarchy (access, aggregation, and core) of network architecture is being replaced by flatter architectures, virtualised application software is replacing network appliances, and network infrastructure is becoming more ‘programmable’. Ovum believes that SDN provides an opportunity to completely re-examine network architectures, introduce virtualisation, and provide truly innovative solutions, with more of a focus on the intelligence inherent in the network, rather than the feeds and speeds of data.

With SDN the network will dynamically adapt to provide the connectivity services that best serve the application and a better approach will eventually produce networks that are much more flexible in providing new services and monetising the network, as well as being more efficient in their use of resources.

Yet hype is an ever present threat in the world of technology and Informa senior research analyst Dimitris Mavrakis expects some observers to say, “this feels like 2006 all over again.” The thing is that telco SDN essentially promises the same thing that IMS promised six years ago: horizontalisation of the network without clear revenue opportunities.

However, he states, “telco SDN has serious advantages over IMS: SDN is already being implemented in the IT domain and operators and vendors will have learned from their involvement in IMS. Also, SDN is attempting to enter the market by converting practices and technologies from the IT domain so that they can be applied in the telecoms environment. Contrary to this, IMS was a completely new— and very optimistic—concept.”

This won’t necessarily stop vendors creating fanciful and colourful presentations about SDN, nor stem the talk about how operators need to move from silos to horizontal platforms and networks.

Addressing the cacophony of different definitions for telco SDN is ETSI’s Network Functions Virtualization (NFV) forum. The NFV believes Network Functions Virtualisation is applicable to any data plane packet processing and control plane function in fixed and mobile network infrastructures, although NFV sees itself as complementary to Software Defined Networking in that the topics are mutually beneficial but are not dependent on each other. But although SDN and NFV are arriving at an appropriate and interesting time for carrier networks, as telco and IT environments are merging, prompting a requirement for clear definition, Mavrakis believes telco SDN currently has some serious challenges to overcome.

“Each vendor has a different definition of SDN, but hopefully NFV will force vendors to align to its vision. NFV compatible (or standardised) elements will not arrive in the market for at least one to two years from now. And NFV elements may require forklift upgrades for existing infrastructure, where there may not be a clear revenue opportunity, but only cost savings,” he says.

Before answering this question, it’s worth looking at the telco SDN story from the beginning and why the market is a particularly interesting – and ripe – environment for SDN.

What is telco SDN?

Telco SDN seems to be everything that is described by the following mantra: network elements implemented in software running on commoditised IT platforms. Each vendor has a different implementation, strategy and even definition of SDN, and there seems to be confusion in the market regarding both the actual deployment of SDN in the telco network and the value proposition of the new technology. For example, one vendor claims that in a true SDN,  every element in the network needs to run in software (as far out as the antenna), while other vendors consider that an SDN should be implemented in the data centre for control/data plane abstraction.

In the IT domain, SDN largely refers to OpenFlow (although SDN is theoretically a much broader concept), where the control and forwarding planes are separated to enable more flexible management of traffic through software programmable routers. Virtualisation is usually considered to involve  running several instances of servers in the same data centre, a practice which is quite well established in the cloud market. However, both SDN and virtualisation may refer to different network aspects or techniques, which depend on vendor strategy, network environment and legacy.

To summarise, telco SDN currently refers to the replacement of network components with software running on commoditised IT platforms. Several telecom network elements are particularly interesting for this scenario:

• Legacy and out of date equipment: Instead of having to maintain, support and upgrade equipment that is enabling legacy services, SDN can replace their functionality in software which runs on standard IT platforms. Network elements that are in this category include Broadband Remote Access Servers (BRAS) and PSTN network elements.
• Processing-hungry infrastructure: Software driven elements that can allocate processing capacity real-time are very relevant, so that overprovisioning can be minimised. Such elements include video or traffic optimisation gateways or anything that requires a high processing load.

Enter NFV

In order to address the cacophony of different definitions for telco SDN, operators have setup the Network Functions Virtualization (NFV) forum which is described by the following:

Network Functions Virtualisation aims to address these problems by leveraging standard IT virtualisation technology to consolidate many network equipment types onto industry standard high volume servers, switches and storage, which could be located in Datacentres, Network Nodes and in the end user premises. We [the NFV] believe Network Functions Virtualisation is applicable to any data plane packet processing and control plane function in fixed and mobile network infrastructures.

We would like to emphasise that we see Network Functions Virtualisation as highly complementary to Software Defined Networking (SDN). These topics are mutually beneficial but are not dependent on each other. Network Functions can be virtualised and deployed without an SDN being required and vice-versa.

Key operators, including AT&T, Telefonica, Deutsche Telecom, Vodafone, France Telecom and Verizon Wireless and several vendors including Alcatel Lucent, Cisco, Huawei, IBM, Juniper Networks and NSN are founders of the NFV forum. An interesting departure from the standard membership model of telecom bodies is that IT vendors have joined, indicating that there is considerable potential in the telecoms environment.

The member list of the NFV forum can be found here and the white paper outlining the mission of the NFV here.

Why now?

SDN and NFV arrive at an appropriate and interesting time for carrier networks. The following reasons are key factors for the increasing interest in telco SDN:

• The telco and IT environments are merging and there is a requirement for clear definition –and perhaps standardization – of telco SDN.
• Following LTE, infrastructure vendors have considerably fewer opportunities for revenue growth. LTE-Advanced is expected to be an incremental revenue driver while small cells will not be able to match revenues for nationwide LTE deployments. In a way, telco SDN is the next potential revenue driver for infrastructure vendors.
• Operator cloud strategies are evolving and carriers are deploying data centres, where the IT version of SDN (primarily OpenFlow) is deployed. It is natural that this will propagate to network elements, which may be implemented in software in these data centres.
• The increasing drive for lower OPEX, less reliance on over-provisioning, ability to react to unplanned events and better efficiency in integrating new services (or partners) are all becoming a necessity. These are also all advocates for the flexibility and scalability that SDN offers.

On the other hand, telco SDN currently has some serious challenges to overcome:

• Each vendor has a different definition of SDN, but hopefully NFV will force vendors to align to its vision.
• NFV compatible (or standardized) elements will arrive in the market at least one to two years from now.
• NFV elements may require forklift upgrades for existing infrastructure, where there may not be a clear revenue opportunity, but only cost savings.

Is telco SDN the new IMS?

Telco SDN essentially promises the same thing that IMS promised six years ago: horizontalisation of the network without clear revenue opportunities. However, telco SDN (and the NFV) have serious advantages over IMS: SDN is already being implemented in the IT domain and operators and vendors will have learned from their involvement in IMS. Also, SDN is attempting to enter the market by converting practices and technologies from the IT domain so that they can be applied in the telecoms environment. Contrary to this, IMS was a completely new – and very optimistic – concept.

The future is brighter for telco SDN. Although vendors may be currently marketing it similarly to IMS, operators will surely make sure that outcomes of the NFV address their key concerns – and tone down vendor hype.

Ericsson is expanding its skillset

Swedish equipment manufacturer Ericsson has announced its intention to acquire the IT services capabilities of the Devoteam Telecom & Media operation in France.

The deal will see 400 France-based IT services professionals join Ericsson, including the company’s TV SmartVision operations, which is in line with Ericsson’s strategy of being a ‘one stop’ shop.

Devoteam’s main competences are in the areas of consulting and systems integration for operations and business support systems, service delivery platforms and applications, IP Multimedia Subsystems, IP and radio networks and TV.

“Acquiring activities of Devoteam adds unique expertise in complex, strategic and technical consulting engagements that will enable us to immediately enhance the value that we bring to our customers,” said Magnus Mandersson, Ericsson’s executive VP and head of business unit global services.

Ericsson’s strategy is focused on leveraging assets that it has acquired in recent years. Building on the acquisition of Telcordia in 2011, B/OSS has become a key strategic area for Ericsson to focus on as it is so closely tied to SDN (software defined network) evolution, according to CTO Ulf Uwaldsson.

Read more about Ericsson and NSN’s strategies

Ericsson has also recognised the challenge in integration of wifi technologies with those developed by the 3GPP. Building on another acquisition— BelAir networks in April of 2012—Ericsson is now tackling the issue with a wifi controller interface that talks to the 3GPP core, allowing operators to apply the same policy control and charging mechanisms. The company unveiled the first product to make use of this technology in October, with the launch of a stadium optimised wifi access point and controller.

And with Redback, which gave it strong assets in IP routing technology, the firm acquired the “glue” to hold broadcast, IT and telecoms services together in the broadcast services division of Technicolor.

Ericsson

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Poland is a country with a population of around 40 million and around 40 per cent of those live in rural areas

Once upon a time, when most of the industry still knew GSM as Groupe Spécial Mobile and Nordic Mobile Telephony was the big success story, another digital cellular operation was finding its feet. The CDG (CDMA Development Group) was formed to push the adoption of a technology that would become CDMA2000 in what many perceived as bitter rivalry against the 3GPP’s UMTS standard.

Fast forward two decades and with so many CDMA flag bearers migrating to LTE, the CDG has changed its focus to stay relevant. NMT finally disappeared from the landscape earlier this year and it’s actually these low frequency bands, such as 450MHz, once popular in many parts of Northern and Eastern Europe for analogue telecoms services, where the organisation is now heavily pushing its technology for spectrum– and capacity-poor mobile carriers.

It is well documented that one of the biggest problems facing an operator today is spectrum availability. So when the world’s last NMT network was switched off, in Poland, in June of this year, local licensee Orange found itself with a swathe of unused spectrum and a golden opportunity to offer something its rivals couldn’t.

The operator swapped out NMT equipment for CDMA450 and, exploiting the frequency’s natural efficiencies, was able to get a 12x increase in coverage versus 1800MHz or 2100MHz. Poland is a country with a population of around 40 million and around 40 per cent of those live in rural areas. As the only operator with a 450MHz licence, Orange has the monopoly, and while EDGE covers 99 per cent of the territory, WCDMA deployments are only focused on major urban areas. Less cells meant that the carrier was able to deliver ‘wireless broadband’ to 90 per cent of the Polish geography, with CDMA450 users now delivering an ARPU of around $18 per month. It is the relatively low ARPU of the rural regions as well as the challenging territory for network buildouts that make the 450MHz spectrum so well suited to this application. As Piotr Stepniewicz, manager of strategic projects for Orange Poland puts it, there is simply no incentive for any of the local carriers to invest in LTE or even 3G outside of dense urban areas, even if they were to collaborate.

“10MHz of LTE spectrum delivers the same experience to a user as 5MHz of CDMA spectrum, so it doesn’t make sense to invest,” he says. As a result, Orange is serving the rural Polish market alone. Orange Poland shares certain similarities with Triatel’s operation in Latvia. The 100 per cent privately-owned carrier achieved 98 per cent geographic coverage of the 64,000 square kilometre territory, playing home to two million people, with just 160 CDMA450 basestations.

According to Viktors Topors, technical director at the Latvian operator, the average CDMA450 base station on the Triatel network offers a coverage radius of 46km, extending up to 100km off the coast. By his calculations it would be “impossible” for HSPA+ to provide the same level of coverage even with “a few thousand” basestations.

Cranking the theoretical 3GPP deployment up to LTE would improve the coverage map by an order of magnitude but still not put it in the same ball park. Again Topors estimates that an LTE900 deployment would require more than 600 basestations to provide a similar level of coverage—a rollout plan that would no doubt struggle to find investment.

One of the key factors pointed out by Joseph Lawrence, VP of marketing at the CDG, is that an LTE carrier needs a site deployment that is guaranteed to cater to around 500 people per basestation, in order to justify the buildout. “This is why there are no cellular installations in places like upstate New York or Vermont. It just doesn’t make economic sense to cover these areas as there are not enough people there. And if a carrier won’t put HSPA+ or CDMA2000 in these places then why would they put LTE there?” he said.

Triatel can get away with between 50 to 100 customers per base station, depending on location, but Topors acknowledges that some rural regions are slim pickings. “There are some areas where there is only one police station or a single post office in the coverage area of a basestation, especially in the Russian border areas,” he says. To this end, Triatel is actually considering shrinking its coverage area when the mandate on its 450MHz spectrum licence requirements expires in June of next year. The company could relocate some of the basestations it has in areas where deployment doesn’t make economic sense, and then perhaps coverage in some of the borderlands would be provided by Russian operators.

“It’s commercially viable that we could shrink coverage by five to seven per cent or about six base stations,” Topors said, “without making any difference to our subscriber numbers or revenues.” The economics make CDMA450 a niche, but attractive play for those that have the opportunity.

“African operators I have spoken to, say they have to do business on ARPU of less than $5 per month, and 450 means operators can still be profitable on that kind of ARPU,” says Lawrence. “Economically, 450MHz is maybe three times more effective at coverage than 900MHz and around twelve times more efficient that 1800MHz or 2100MHz cells. But it also helps breach the digital divide.

“450MHz spectrum is the best solution for the connected world. In fact it doesn’t even matter what technology is used really, just that if you can make use of the 450MHz band you will be able to economically connect schools, businesses, communities and emergency services. And when you can do that with one basestation instead of 12 then the economics are dramatic. All the same services on 3G and 4G are enabled on the 450MHz band,” he said. Statistics from the CDG show that there are 116 450MHz networks in operation today across 61 countries, with new deployments still popping up. All of these installations use CDMA, and 12 new CDMA450 networks were launched in 2011, with two more upcoming deployments in Georgia and Serbia.

A quick look down the list of countries supporting 450MHz cellular deployments underlines the historical association with NMT in Northern and Eastern Europe, with the rest being soaked up by Central Asia, the Middle East, Africa and Latin America—emerging markets almost every one.

In other parts of the world the 450MHz band is used for trunking systems such as emergency services radio installations, military deployments, or even sits unused. Brazil, for example, took almost ten years to clear the 450MHz spectrum for use as it was being used by the federal police, so it’s not always easy to make the spectrum available for reuse. In the US it is used for trunking services and in the UK for wireless microphones and broadcast equipment. But in much of Western Europe, the 450MHz band is an untapped resource that has not even been auctioned yet.

The point, according to the CDG, is that lots of regulators don’t realise they are sitting on this potential gold mine, which could potentially even be used for LTE deployments. The remit of the CDG (which has renamed itself as the acronym and dropped all reference to CDMA) now, is to educate the industry on the importance of 450MHz networks for people and machines (M2M), given the understanding that LTE will not deliver broadband coverage for whole regions, leaving 3G and other technologies to pick up the slack as demand for wireless service grows.

To further explore Joseph Lawrence’s point about technology agnosticism in the 450MHz band, we spoke to Igor Virker, director of business development at the CDG, who revealed that the group is working with LTE stakeholders to specify LTE for 450MHz using non-contiguous spectrum. Virker warned this will likely be an arduous process, as standards bodies like the ITU and 3GPP need to be involved, but nonetheless, there is strong interest from operators in Brazil, as well as the local regulator, Anatel, and Sky Link, the Russian CDMA450 player.

“We could be there in about five years with input from Brazil,” he says, “but the challenge for new licensees is always coverage obligations, so maybe the operators don’t want to wait for LTE450 to mature.”

The vendors face a similar dilemma. While CDMA450 makes up a good chunk of Alcatel- Lucent’s portfolio at present, Brahm Parasher, network strategy manager at the vendor says that vendors are understandably reluctant to develop a solution without a standard in place, as they don’t want customers to be left with a proprietary offering.

In the meantime, CDMA is really the only solution for the 450MHz band, and with only 34 EV-DO Rev. A commercial networks and four EV-DO Rev. B commercial networks in play, there is plenty of headroom in the technology roadmap.

“Because it’s at the bottom of frequency pile, 450MHz offers the greatest range and covers the most distance. It means less cell sites and less backhaul and it also has good building penetration, making it a great choice for talking to smart meters in homes,” says Joseph Lawrence.

“It was licensing conditions that forced CDMA 450 into being the defacto standard globally for fixed wireless because of tough competition from GSM. The country of Georgia, which has three CDMA450 operators, has 50 per cent of its broadband subscribers on fixed wireless, and achieved that in just a few years. Then with Orange in Poland, once you leave the metro areas you are into CDMA coverage because as soon as you go out of urban areas the economic model becomes weaker,” says Lawrence. “You will never see a single technology used all over the world comprehensively.”

As both Orange Poland and Triatel Latvia attest, fixed wireless offers a great opportunity mainly due to a sheer lack of competition. Orange’s Stepniewicz says that many suburban new builds in the country have no fixed line access, so the operator offers a variety of consumer end point devices from nomadic routers to multi-mode dongles supporting WCDMA, GSM and CDMA in one unit.

In Latvia, there is a government sponsored project to close the Digital Divide by taking fibre out to 169 points of presence in the country and then letting local entrepreneurs extend those connections out to villages and other remote areas. Of course Triatel is there already with a wireless offering that delivers pretty good in building coverage, something that drives down the attractiveness of the state’s ‘middle mile’ project.

The other thing about rural and developing regions is that user expectations tend to be quite low. The majority of ex-NMT customers were either fishermen or farmers using the devices for work purposes, and the newer CDMA450 deployments are catering to much the same demographics from Poland to Indonsia. Operators like Orange say their user base is happy with the experience, with Alexsander Jakubczak, wireless access division director, Orange Poland, claiming that users can’t see any difference with most apps, “except maybe with video streaming.”

In Poland, Orange only guarantees downlink speeds of 1Mbps, but while testing in a rural, woodland area, MCI got an average throughput of 3.6Mbps and streamed high definition video with little buffering. Orange’s CDMA450 network has so far been upgraded to Revision B Phase One only, which was a software upgrade to the network. A second phase hardware upgrade is planned over the next year, where the network cards are swapped out in the base stations, pumping the network downlink peaks up to 14.7Mbps.

Jakubczak said that Revision B Phase 2 would increase throughput and improve network QoS, with the carrier offering packages supporting 45Mbps peaks for HSPA+ in urban areas and 1-2Mbps for EV-DO Rev. A in rural areas. With Rev. B Phase 2 this will jump to about 9.6Mbps in the rural regions. “But considering the alternatives, our users don’t have very high expectations,” he says. “So there is still scope for much of the countryside.”

All Orange Poland’s SIMs are multi standard by default, allowing access to all networks, regardless of device or terminal. Users have to switch network manually, but the only real issue is finding a supply of attractive devices that actually support both CDMA450 and HSPA+.

In Latvia, Triatel is competing against market incumbent LMT which has a licence for 2100MHz as well as DSL operators offering up to 10Mbps links. But Topors believes his company is competitive with average downlink speeds of 5-7Mbps with Rev. B Phase 2 and peaks of 14.7Mbps, while upload speeds average at 2-3Mbps and peak at 5.4Mbps. The company is also targeting a mid-price point compared with fixed line, selling its fixed wireless service for Lat19 or around €25 per month. From next year the company will also start an education programme to push capped offers based on usage bundles as Topors believes most people don’t need unlimited data.

The defining factor among these markets is that there are clearly some areas that don’t have fixed broadband because it’s not economical to deploy—some don’t even have narrowband, because the demand simply isn’t there. But what the CDG argues is that regulators don’t realise the potential of the spectrum they are sitting on. It comes down to an education issue, Joseph Lawrence believes. And while the potential of that spectrum is somewhat limited by technology at present, this may not always be the case.

“CDMA is the only technology working in the 450MHz band today but we are working with stakeholders to develop specs for LTE. Spectrum aggregation can allow you to expand bandwith with non contiguous spectrum,” he says. And bear in mind that CDMA 2000 operators are actually responsible for much of LTE’s initial growth, especially those based in the US.

The Raspberry Pi

One of the biggest innovations to come out of the UK in 2012 has been the Raspberry Pi – the sub £30, Linux-based, credit-card sized computer. The aim of the Raspberry Pi Foundation is to educate the next generation of software and hardware engineers in programming, but the device has been hacked for many purposes. Not least by telecoms consultancy PA Consulting, which recently crammed a cellular basestation onto the three inch device.

To evaluate what the platform was capable of, wireless experts at the PA Technology Centre got hold of a Raspberry Pi and overcoming some seriously complex obstacles along the way, successfully managed to route voice and SMS traffic through the unit – as well as implement the GSM mobile phone standard.

“We got hold of a Raspberry Pi and decided to evaluate the platform by seeing if we could implement a mobile phone base-station that could run our own private mobile-phone network,” said Alastair Smith, PA Wireless technology expert.

Essentially, the consultancy shrank a 30ft base-station into a three-inch Raspberry Pi and set up its own private mobile phone network.

The operation had to be set up in a screened-room facility to ensure the company didn’t break any laws on spectrum usage, but managed to hook the Raspberry Pi up to a radio interface, alongside a set up using three pieces of software: OpenBTS, which implements the GSM mobile phone standard; FreeSWITCH, which routes calls in a similar way to Skype; and the company’s own Python script that assigns telephone numbers to users.

Click here to view the embedded video.

On the face of it, everyone got what they wanted. KPN and Vodafone came away with the biggest haul, picking up blocks in each band on offer, while third-placed T-Mobile picked up some spectrum in the 900 and 1800MHz bands. Tele2, meanwhile, added 2x10MHz of 800MHz spectrum to the 2.6GHz it already holds, which had been reserved especially for a new entrant and turned out to be the only purchase Tele2 was interested in. It beat fellow challenger ZUM, a joint-venture between cable players Ziggo and UPC, for the spectrum and will now be looking at further building out its 4G network.

Of course, this follows on from the launch in May of LTE services by all five existing operators, including Ziggo, using the 2.6GHz spectrum they all acquired two years ago. As we reported at the time, the launches were intended to fulfil the coverage obligations attached to the 2.6GHz spectrum, rather than offering a truly commercial proposition. A full launch will be possible now for the four operators that won spectrum, while Ziggo and UPC will be limited to offering broadband over 2.6GHz to their fixed customers. But it’s unlikely they would have become a true fourth operator anyway, given that while both currently operate MVNOs, their MVNOs offer mobile broadband only.

The question, however, is whether the Netherlands can support four mobile operators. Although it’s a relatively small market, the regulatory authorities believe that the existing three-operator market has led to the Netherlands having some of the highest prices in Europe for mobile services. True or not, Tele2’s stated aim will be to heavily disrupt the market; for any operators on the brink of packing up and leaving, this will be the time to do it.

If I had to guess which player will leave, my money is on T-Mobile – it’s currently languishing in third place, and has effectively already pulled itself out of the fixed-line market, by no longer promoting its fixed voice, broadband and TV propositions. Not only that, but parent company Deutsche Telekom has suggested in the past year that it might sell off certain operations, following on from the failure of its planned merger with AT&T in the US; the Dutch operation was one of those mentioned at the time.

If T-Mobile does sell up, it’s difficult to imagine regulators allowing KPN, or even Vodafone, to buy it. This opens the intriguing possibility of it selling to Tele2, which runs its MVNO on T-Mobile’s network; and since Tele2 is already effectively a fixed player with an MVNO, it would be ironic to see the two switch places, with Tele2 hosting T-Mobile as an MVNO on what was previously its own network.

While this may all be blue-sky thinking, it’s clear that the Dutch mobile market is in for some upheaval over the next year. Regulators may have intended to increase competition – which the arrival of Tele2 is certain to do – but the decision to allow a fourth operator is unlikely to be the panacea they hoped for.

Joyn/RCS is based on IMS

A Silicon Valley startup on Wednesday received funding from Vodafone to help make the carrier’s answer to OTT (over the top) services a viable alternative to the likes of Skype and WhatsApp.

Vodafone Ventures, the US investment vehicle for Vodafone group, led the $8.3m financing round with help from Tokyo-based game creator MTI. The startup, Jibe Mobile, is developing applications and technology for the GSMA-backed Joyn initiative that will deliver inter-carrier rich communications services (RCS).

Last month, three Spanish operators became the first to offer cross-network rich comms services, with Movistar, Orange and Vodafone enabling customers to chat and enrich messaging or voice calls with images or video. Additional services such as voice over IP (VoIP) and IP-video calling are set to be introduced in the near future.

Jibe said it will be developing the world’s first open technology platform leveraging RCS 5, enhancing its open APIs to help developers incorporate real-time, ‘rich communications’ into mobile applications.

“There is no doubt that rich communications is becoming an increasingly important part of the consumer mobile experience. Jibe’s mission is to make carrier-grade communications simple and accessible for the global market,” said Jibe co-founder and CEO Amir Sarhangi. “In-app communication increases user engagement and creates new monetization opportunities for developers.”

The 4G auction is getting underway

Tuesday marks the next important milestone in the UK’s telecoms market as prospective bidders submit applications for 4G spectrum.

Between 10:00 and 16:00 on December 11, 2012, interested parties are able to submit applications, accompanied by an initial deposit of £100,000 into Ofcom’s bank account. The passing of the deadline takes the UK one step closer to the completion of a highly controversial and long-awaited spectrum action, which is expected to be finalised by February or March next year.

UK regulator Ofcom has set a reserve price of £1.3bn for all available spectrum, including 2x15MHz of 1800Mz spectrum that Everything Everywhere is required to divest as part of the deal that saw it cleared to launch LTE at 1800MHz in October.

As far as the UK’s mobile operators are concerned, the auction can’t happen soon enough. Despite the encouraging signs seen since EE went live, the UK is still lagging far and away behind the world’s most advanced 4G markets.

To put this in context, according to Thomas Wehmeier, Principal Analyst at Informa Telecoms & Media, by the time the remaining 4G networks are switched on at some point in the middle of next year, more than one-third of Korean and about 20 per cent of Japanese consumers will already be actively using 4G services in their respective countries.

“But that’s not to say that we don’t expect to see a marked acceleration in the pace of 4G adoption in the UK next year. By that point, most of the high-end flagship phones on sale in the UK will support 4G technology, we can expect to see some pretty competitive pricing as the markets kicks into life and the inevitable blanket market campaigns are sure to lift interest in and adoption of 4G amongst UK consumers,” he said.

Analysts are expecting the amount raised to represent just a fraction of the record £22.5bn spent during the 3G licensing round in April 2000, during exceptional times, before the dotcom bubble burst. The industry will be much more cautious this time around, not least because of the weak economy and the declining revenues that many operators are suffering in the UK and across Europe.

In his recent Autumn Statement, the UK Chancellor George Osborne pegged the amount the UK Treasury is hoping to raise at £3.5bn, which puts the official view slightly above industry expectations, but broadly on par with the amounts raised in similar auctions in other European markets such as Germany.

Informa is expecting the auction to attract all the usual suspects , meaning the UK’s existing mobile operators Vodafone, Telefonica O2, 3 UK and, of course, EE, which will be looking to bolster its existing 4G spectrum position.

“What we don’t know and can’t predict is whether we’ll see any wildcard bids. There’s been plenty of industry speculation about the possibility of some of the UK’s other telecoms and media powerhouses, the likes of Virgin Media, Sky or BT, entering the fray, but the experience of looking to other markets that have held similar auctions means we should be surprised if there is a genuinely disruptive and large-scale bid from one of the players. It can’t be ruled out, but it would certainly be unexpected,” Wehmeier said.

Apple's iPhone 5

Apple is not allowing mobile operators to offer the iPhone 5 as an LTE device unless they pass the Californian vendor’s own, independent tests for LTE network performance, Swisscom has confirmed.

Telecoms.com was told of Apple’s policy in October but, at the time, no operator had conceded publicly that it was true.

This week, however, a Swisscom spokesperson told Telecoms.com that: “Apple only enables 4G access after testing their device on an operator’s live network.”

Swisscom launched its LTE network this week although the iPhone 5 was not available as an LTE device at launch. “Apple will provide a software update in due course,” the firm said in a press release.

Bengt Nordstrom, founder and CEO at industry consultancy NorthStream told Telecoms.com that his firm had also learned of Apple’s network testing policy in October. Nordstrom said he was “shocked” when told about the policy, which restricts operators to offering the new device on 3G networks until Apple enables LTE functionality.

It proved, he said, “who is running the industry”, adding: “Apple have put themselves in the driving seat; it’s really changing the game.”

While extensive network testing of handsets has always been necessary, the focus has historically been on whether or not the handset functions on the network, with operators keen to protect their network assets and customer relationships against poor quality devices.

A handset vendor vetting networks on a technical basis before allowing its device to be used on them is a reversal of this situation, and one that Apple alone has the power to bring about.

Alcatel Lucent CTO Marcus Weldon told Telecoms.com that, although Apple had got “a bit big for its boots”, the policy proves the importance of the network in the mobile experience. This is a positive development he said, given that the network has a low perceived value among many end users. But Nordstrom suggested that putting such power in the hands of an organisation “that does not invest in networks” created a situation that is “unique”.

Telecoms.com requested comment from Apple but had received no reply at the time of publication.

VoLTE consumes twice the power of 2G a test has found

Calls conducted on VoIP over LTE (VoLTE) consume twice as much power as those over a 2G CDMA network an investigation has found.

Radio field testing company Metrico Wireless, now part of Spirent, found that power consumption during a ten-minute VoLTE call was 1358mW compared to 680mW on CDMA circuit switched. According to GigaOM, the tests were likely to have been conducted on an LG Connect 4G on the MetroPCS network in the US, as this is the only commercially available VoLTE handset on the only US network to offer VoLTE.

As a result of the findings, battery life on the handset would drop from 502.6 minutes of CDMA call-time to just 251.8 minutes of VoLTE.

The first LTE capable phones were known for their poor battery life and flipping between circuit- switched voice calls and LTE for data were said to be one of the key reasons for this, so the poor battery performance of VoLTE calls will be of concern for the industry.

However, it is just one test, on one handset on one network, and performance is likely to improve once optimisations are made, Spirent Global Director of Insights Amit Malhotra told GigaOM, ““The disadvantage in battery life of VoLTE compared to circuit-switched voice is driven by a few different factors. One is the more strenuous exercise of the device, including conversion of voice to packet data, transmission and receipt over the data network, and reconversion back to voice. Another is the use of less power-efficient components such as data modems versus voice transceivers.”

However, the handset was found to use less power when making a VoLTE call and using data, than when making a 2G calls and using data.

Devicescape aims to cut data costs

US software firm Microsoft has given Windows Phone 8 users access to a sizeable global wifi network intended to improve the user experience and rein in data costs.

Microsoft has licensed software from Californian wifi offload specialist Devicescape to give Windows Phone 8 users access to the company’s Curated Virtual Network (CVN). This is a global wifi network of over 11 million wifi hotspots, mostly in the US, which have passed a strict assessment of service quality.

Devicescape’s CVN leverages crowd-sourced data from the millions of devices already deployed. Any device with the software installed will automatically sniff out more suitable hotspots and add suitable connections to the network. Devicescape can then partner with operators to offer the service to end users on a variety of pricing plans, although many carriers offer the service for free.

According to Thomas Wehmeier, principal analyst at Informa Telecoms & Media, the Devicescape tool will work nicely alongside Datasense functionality included in Windows 8.

Datasense is a toolset, unfortunately not integrated into all Windows Phone 8 devices, that helps users manage their data usage. With compression and monitoring Microsoft estimates that users can squeeze up to 45 per more out of their data plan. Verizon will be the first carrier to activate Datasense on the Windows devices it sells.

Wehmeier believes the offering will go some way to rectifying the shock experienced by many users of Windows Phone 7, which made much use of live tiles that required a data connection and did not offer much by way of control over those connections.

With Datasense and Devicescape, Windows Phone 8 promises to be a much better experience, potentially putting users more frequently in range of free to use public wifi hotspots.

The move could also propel Devicescape, which so far has only had deals with Tier 2 carriers, into the big league.

“Mobile data caps, tiers and throttling are limiting the smartphone experience”, said Dave Fraser, CEO of Devicescape. “By leveraging the Devicescape network of public hotspots, Microsoft can now pass along tremendous value to its Windows Phone 8 users enabling them to locate a nearby quality wifi network. Windows Phone 8 users will now have an alternative way to manage their monthly data plan while maintaining the quality of service they are accustomed to from their mobile provider.”

At present, the sign-on-to-wifi experience is still manual, but this is largely due to poor integration between wifi and cellular. However, the 3GPP and wifi standards bodies are actively addressing this issue and the next phase is to move on to automatic hotspot sign on.

This week the Wireless Broadband Alliance (WBA) and the Small Cell Forum announced plans to work together to better integrate wifi hotspots and licensed small cells.

The two organizations will cooperate on a range of initiatives including simple measures such as looking at how small cells could impact the WBA and GSMA’s efforts to simplify Next Generation Hotspot (NGH) access, and sharing best practices for optimising the user experience and operator deployment strategies for joint wifi/small cell hotspots, building on the NGH program which is removing the need for usernames and passwords.

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The project could have an impact on datacentres

An organisation founded in 2010 to define the future of Linux on low power mobile chips from ARM has won support from social networking giant Facebook.

Linaro, a not-for-profit engineering organisation dedicated to developing open source software for the ARM architecture, has announced today the formation of the Linaro Enterprise Group (LEG) following the addition of AMD, Applied Micro Circuits, Calxeda, Canonical, Cavium, Facebook, HP, Marvell and Red Hat as members.

In response to significant interest in energy-efficient ARM-based servers, the LEG has been founded to collaborate on the development of foundational software for ARM Server Linux.

Linaro operates a business model where multiple companies jointly invest in a software engineering team that creates core open source software in a collaborative and transparent environment. T

“Linux is driving innovation in every area of computing from mobile and embedded to the cloud. Linaro’s enterprise efforts will bring together software engineers to help accelerate Linux development for ARM servers, and we’re confident that this new server-focused group will advance Linux in these areas and offer additional choices to Linux users around the world,” said Jim Zemlin, executive director of the Linux Foundation.

ARM servers are expected to be initially adopted in hyperscale computing environments, especially in large web farms and clusters, where flexible scaling, energy efficiency and an optimal footprint are key design requirements. The LEG will initially work on low-level Linux boot architecture and kernel software for use by SoC vendors, commercial Linux providers and OEMs in delivering the next generation of low-power ARM-based 32- and 64-bit servers. Linaro expects initial software delivery before the end of 2012 with ongoing releases thereafter.

As a heavy user of cloud systems and data centres, Facebook’s interest in the project is perhaps unsurprising, but still interesting.

“ARM microprocessor architecture has the potential to bring about a fundamental shift in the datacenter industry, enabling new levels of compute and energy efficiency and spurring greater competition in the server CPU market,” said Frank Frankovsky, VP of hardware design and supply chain for Facebook. “But a lot of work must still be done to turn that vision into a reality, and the Linaro Enterprise Group can play a crucial role by ensuring that we have the software ecosystem necessary to support these new ARM-based server solutions.”

The agreement with Cybercom will see the transfer of 27 R&D employees from ST-Ericsson to Cybercom

Embattled chipset firm ST-Ericsson has agreed to transfer its R&D division based in Linköping, Sweden, to local IT consultancy Cybercom. The move follows recent speculation regarding the future of ST-Ericsson, the 50/50 joint venture between Ericsson and STMicroelectronics, as the company battles worsening losses.

ST-Ericsson has indicated that more changes are still to come.

Earlier this year the company said it foresees a global workforce reduction of 1,700 employees worldwide, from approximately 6,700, with changes to be complete by the end of 2013. The agreement with Cybercom will see the transfer of 27 R&D employees from ST-Ericsson to Cybercom, joining a team of 75 consultants offering connectivity engineering and security services to clients mainly in the industry segment in the region.

Cybercom will develop testing tool software for ST-Ericsson through June 2013.

“The agreement with Cybercom allows us to continue to progress on the site and resources strategy we announced in April,” said Carlo Ferro, chief operating officer of ST-Ericsson, “which aims to enhance operational efficiency of the company by reducing its worldwide activities into fewer sites lowering the break-even point.”

Earlier this week Ericsson said that it was “natural” for the parent companies to continuously review the strategy of the company, and that both parents are currently working with an external advisor in “order to ensure the best possible future for ST-Ericsson”.

The $1bn problem — “Wasted Data”: If two different devices with comparable specifications are used to download and display the same content while everything else is held constant (mobile data network, time of day, username), then most of us would expect the amount of downloaded data to be about the same. It isn’t. Nowhere near in some cases. What we see in practice is that when tests are performed that measure what an actual end user sees (i.e. in a live environment with live data), wide variations exist between devices in terms of the amount of data downloaded, and the excess data is effectively unused — it’s wasted. This is not “signaling traffic.” It’s actual “user” data passing across the network which is unnecessary for the action that the user has requested. The differences in the amount of data can be quite startling and completely unexpected. For instance, take a look at charts 1 and 2.

Chart 1 shows that a signature Motorola device running Android “Gingerbread” consumes 70KB (140 per cent) more data than the iPhone 4S to perform exactly the same operation (viewing a friend’s wall on Facebook).

Chart 2 shows that the Nokia Lumia 900 consumes a staggering 2.4MB (800 per cent) more data than three other equivalent devices when searching for the same YouTube video.

These are not isolated examples.  Everywhere we look, we find the same propensity for different devices to download different amounts of OTT data for the same output. And it’s not always the same devices that appear to waste data.  While the Lumia performed badly on a YouTube search, it performed significantly better than the three other devices on a Google search, each of which consumed (i.e., wasted) about 200KB more data than the Lumia.

Most surprising of all, we see the same “wasted data” effect between different versions of the same base operating system. For instance, one particular device running Android version 2.3.x displays the same behavior as the Lumia on a YouTube search (downloading the entire video before the user has decided whether to play it or not), while the same device running Android 4.0.x has one of the smallest data footprints on exactly the same test.

Now, 70KB here and 200KB there might not seem like much on wireless networks which are now delivering multi-megabit data rates. But remember, this isn’t just happening now and again. OTT apps such as Facebook, YouTube and Google are used countless times per day on tens of millions of mobile devices. They represent a very significant percentage of the total data network footprint, so having even small amounts of waste on almost every page adds up very quickly.

Wasted data impacts everyone: Wasted data exists and it seems to be endemic on every device on every application on every network. As a result, it’s having a major impact on operators, OTTs and the whole mobile data ecosystem.

1) The impact on operators: Wasted data, just like usable data, has a cost because it consumes network bandwidth. Based on figures taken from Chetan Sharma’s “US Wireless Market Update, Q1 2012” (specifically, how much data flows across the US wireless networks per month, and the market share of US operators), we calculated a low-end and high-end cost of wasted data to the US operators. The results are shown in chart 3.

Why does this cost matter to operators who charge subscribers according to the overall amount of data they use? Isn’t wasted data actually contributing to their revenue? No, it’s not. In the overwhelming number of cases, operators are not recovering the cost of wasted data for one simple reason: It’s not pushing subscribers into another pricing band. According to recent statement from AT&T, the company estimates that “… its top 5 percent of smartphone data users are consuming 2GB to 3GB, so for most, a 4GB bucket is as good as unlimited.” Looked at another way, reducing wasted data on AT&T’s network would actually result in the same revenue but at a lower cost.

Wasted data also saps the operators’ capital investments in networks, forcing them into earlier-than-forecast capital expenditures on upgrades which could be delayed or even cancelled without the additional wasted data traffic.

A second major impact area for operators is “no fault found” device returns. When customers buy a smartphone, it’s increasingly likely that it is a replacement for an existing device. Their expectation is that the new device will perform at least as fast as their old device and also other devices owned by friends and family. If those expectations aren’t met because that particular combination of device, application and OTT suffers from wasted data, the customer will return the device as “faulty”. The operator then spends time and money testing the device without discovering any faults, and has to resell the device as “refurbished” at a lower margin. This increases their support costs and makes the device less profitable for them. It also impacts the device OEM who suffers lower sales and also brand damage because of the increasing market perception that the device seems to be slow on Facebook or YouTube or Google.

2) The impact on OTTs: As shown in chart 4, there is a clear link between the performance of mobile applications and users’ adoption of those applications. Compuware and many other companies have done extensive research on this subject, and found that even a one second slowdown can cause page abandonment (the typical measure of users’ impatience) to increase by 20 per cent. For many OTTs, this is a disaster:  Their business model is predicated on a growing user base which in turn attracts more advertising revenue.

Applications that consume more bytes than necessary to provide the content requested will run slower than the same application without the wasted bytes. Wasted data means lower performance and it will significantly increase the likelihood of the user abandoning the page.

3) The impact on everyone else: So far, we’ve only discussed the direct impact of wasted data on operators, OTTs and device OEMs themselves, but the reality is that it affects everyone on the network, too. Wasted data occupies bandwidth, and as this disruption increases, it will indiscriminately reduce the bandwidth available to any application which is sharing the same network. Without getting into the technicalities of queuing theory, when busy networks which are close to their capacity get busier, the slowdown effect becomes even more pronounced — a small increase in data traffic can result in a significant slowdown for everyone.

Why haven’t we heard about this problem before? Wasted data is not just a simple device or application effect; if it was, then OTTs, device OEMs and operators would almost certainly see it and fix it during the development and test phases. The only way to detect it is with modern tools that can look at the entire service delivery chain (the device, the application, the mobile data network and the OTT content) from the only point-of-view that really matters — the end user —and not just at the discrete parts.

The data management tools in use today tend to be focused on the part of the delivery chain that each constituent owns (chart 5). OEMs focus on the device, developers focus on the application, operators focus on the network, and OTTs focus on content. Each on their own is blind to wasted data. They simply see how well their part of the chain is working and how well the bytes are moving, not whether those bytes are useful or not. It’s not until all the pieces are put together on an actual data network and measurements are done from an end-user perspective that the “wasted data” effect can be observed and measured. This is not the way that things are done today, and as a result, without the relevant end-user view, wasted data goes completely unnoticed by OTTs, OEMs and operators.

What can be done to fix the problem? First, this is an industry-wide problem that needs an industry-wide solution. Since the operators are the only common factor – and the ones having to bear the biggest financial burden — they have to lead an industry-wide initiative to raise the awareness of the issue with the OTTs and their own device OEMs.

Second, they have to coordinate the testing of devices and applications by setting out a series of end-user experience tests which the OEMs and OTTs must run. Since it’s in everyone’s interest to reduce or eliminate wasted data, most OEMs and OTTs should embrace such an initiative, rather than seeing it as a return to the old days of protecting access to a walled garden.

Fortunately, with the right tools, there is a pragmatic approach that can give actionable and significant results in days. The key to the problem is picking the right combination of use cases which gives the best return for the smallest amount of test effort. In other words:

- What are the top three or four most used devices on a particular network?

- What are the top three applications which generate the most network data? (Almost without exception, the answer is already there: Facebook, YouTube and Google).

- Finally, what is the most common use case with each of those applications? On Facebook for instance, one of the most common use cases is logging in and viewing a newsfeed, looking at a friend’s wall and a picture.

The resulting matrix (chart 6) consists of the 12 tests which need to be performed. These will measure the actual user experience (response time) and number of bytes downloaded to provide a simple way to check for wasted data.

There are SaaS-based tools available which can automate these tests and run them repeatedly across the live data network, including sophisticated reporting capabilities. In fact, these are exactly the same tools as we used to discover and quantify wasted data in the first place.

Conclusion: Wasted data is a billion dollar problem which very few operators, OTTs and OEMs are aware of. It impacts everyone in the service delivery chain, and eliminating it can provide more profits for operators, a better user experience for OTTs and improve overall data network performance for everyone. And it can be fixed simply and easily with the right approach and the right tools.

So now that you know about it, what are you going to do about it?

Mark Hillman, SVP Strategy and Business Development for Compuware

Unrepresentative data on battery life is leading to operator customer service departments fielding four times as many calls on the issue than in 2008

Smartphone manufacturers are leaving customers disappointed with their operators by not quoting battery performance in a way that reflects day-to-day use, according to a study published today.

Customer experience specialist WDS analysed the battery life of 50 of the top smartphones launched over the past year and compared them alongside two million technical support calls taken on behalf of global mobile operators and handset manufacturers.

The findings showed that, for the majority, the battery life of handsets was not quoted in a way that represented how consumers use their devices. This has led to operators fielding four times as many calls regarding battery performance than they received in 2008. As a result, customer service calls relating to battery usage have now risen to make up ten per cent of all hardware related technical support calls.

Despite activities such as web browsing, watching videos and using downloadable apps have become an everyday part of smartphone use, their impact on battery performance is largely excluded from the data published by manufacturers. Only two of the 50 devices that were reviewed by WDS included information on expected battery life for web browsing -  Apple’s iPhone 4S and Nokia’s N9. Instead, consumers are typically left to make comparisons based on stand-by time and 2G talk-time.

“The majority of manufacturers simply publish stand-by and talk-time figures, which have the lowest drain on smartphone battery performance,” explained Tim Deluca-Smith, VP of marketing at WDS. “This means that when consumers start using their smartphones in earnest – downloading and using apps and browsing the web – they often find their battery lasts less than they expected.”

Another report from J.D. Power and Associates, released in March 2012, also suggested that those manufacturers who do publish more accurate battery life data benefit from customer loyalty, with Apple ranking highest in customer satisfaction among smartphone manufacturers.

“A vital aspect of customer experience is setting the right expectation. No single manufacturer can really overcome the limitations of today’s batteries, but they can take the lead in better informing customers,” added Deluca-Smith. “This will not only boost satisfaction, but will also save money for them and their mobile operator partners. Battery life is not something that a consumer can gauge in-store. Simply stating that a device has a 1700mAh battery is meaningless; performance data needs to be in line with real-world use.”