The all-IP network will help Bouygues launch rich media services

French telco Bouygues Telecom has selected Alcatel-Lucent to take a lead role in transforming its broadband network into a single IP-based infrastructure that can support video, high-speed internet and voice services.

Bouygues Telecom is deploying an IP-based model in both the core part of its network that connects with other service providers, and in the access portion of its network that connects with its subscribers.

The new high-capacity IP Multimedia Sub-System (IMS) network is expected to improve the overall quality of service for voice and data, and will enable Bouygues Telecom to deliver services to many devices, such as smartphones and its BBox residential gateway, as well as launch new applications quickly.

The telco’s partnership with Alcatel-Lucent will enable it to benefit from the latter’s R&D facilities in France, including Bell Labs, and gain early access to Alcatel-Lucent’s new innovations in Optics and IP technology, including 100G WDM and the new FP3 400G IP chipset.

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VoLTE could level the playing field for operators under threat from OTT players

Figures from industry body the GSA (Global Mobile Suppliers Association) reveal that 208 operators in 80 countries are now investing in LTE. But while rollouts aimed at consumers are gaining momentum, a study undertaken by research house mobileSquared indicates that one third of operators have no trials or network deployments underway at the moment.

Although these operators said they expected to deploy LTE at a future date, almost a quarter of those surveyed said they had yet to make any decision on LTE because of spectrum or cost issues.

With none of the 38 operators surveyed by mobileSquared believing that LTE handsets would be widely available this year, it’s hardly surprising that 34 per cent of respondents thought that LTE would not become a viable consumer offering before 2013; a further 18 per cent said that 2014 was a more feasible date. According to mobileSquared, this timeframe ties in with a number of operator announcements: AT&T plans to introduce voice over LTE (VoLTE) by 2013 after an initial roll out of circuit-switched fallback (CSFB) and has begun integrating its IMS architecture.

Verizon Wireless, meanwhile, plans to launch VoLTE services in 2012; MetroPCS, having partnered with HTC to roll out a VoLTE-enabled handset, is planning trials for the voice technology later this year.

According to mobileSquared, the adoption of VoLTE by operators is “significant on a number of levels”. Key among these is the price point for IP-based communications. With revenues for voice over internet pricing models close to zero, carriers will be “forced to innovate in terms of how services are offered, packaged and priced,” according to the report. As such, “The most obvious option is to bundle Unified Communications (UC) and Rich Communications Suites (RCS) in a single address book, enabling users to track presence, IM, voice and video calls all with the same identifier – the mobile phone number.”

The report further adds that quality of service (QoS) on connecting network-based mobile VoIP calls will be so much better than over-the-top (OTT) services that a “de facto two-tier system” will be created. “A VoLTE call would be explicitly indentified in the operator domain as real time conversation and routed with low latency transit from network to network, whereas an OTT call would be treated as traditional data on the internet,” according to mobileSquared.

The report, which was sponsored by Broadsoft, concludes that mobile VoIP and the introduction of VoLTE  have levelled the playing field for operators under pressure from OTT players and possibly even given them a competitive advantage, as associated UC offerings that specifically target the business market could prove lucrative. With this last point in mind, it seems that any operators should consider a change in current strategy: 45 per cent of those surveyed admitted that they did not feel they were well positioned to sell LTE as an enterprise solution because of their retail focus. The report concludes that these carriers are missing an opportunity by “not adjusting their business model to include a direct sales force focused on selling more than just minutes of voice to enterprise customers.”

VoLTE may provide the mobile operator business case that IMS has been lacking, but the IMS faithful continue to see a far broader role for the technology, and mobile operators in particular are seeing IMS as a potential revenue-generator.

It was indicative of the continued interest in IMS that fixed and mobile operators made up over half of the delegates, at what turned out to be a lively conference. The debate revealed that while its supporters are still upbeat, they are realistic about the changed perception of the role of IMS in the network, particularly now that over-the-top players have shown that the proposition of an all-encompassing IP service platform can be readily circumvented.

In one sense, however, the IMS discussion has come full circle, with operators now asking whether voice alone can justify investment in an IMS platform, or whether the need is to support a range of rich IP-based services in order to be economically viable.

There was a high degree of consensus that in future IMS would have to pay its way. Deployments would need to be phased and ideally based on a segmented approach that could ensure customer take-up and a return on investment, before moving to the next phase.

The 160-plus delegates in Barcelona were polled by Informa in a live, interactive survey devised in co-operation with Huawei. Asked what were the commercial drivers for IMS today, a slim majority of vendors in the audience delivered a somewhat counter-intuitive verdict, by identifying capex and opex savings as the primary reason to deploy ahead of driving revenue growth. The majority of mobile operators, on the other hand, saw IMS more clearly as a means to drive revenues through service innovation.

Most agreed that the critical time will come in 12 – 24 months’ time, by which time IMS-based LTE voice may or may not have proved to be a building block for a richer set of VoIP-based services, and Rich Communication Suite (RCS), the third leg of the IMS mobile business case alongside FMC and VoLTE, will be seen either to have succeeded or failed.

According to the survey, vendors and mobile operators alike are putting their trust in the RCSe initiative, backed by a group of five leading European mobile operators and approved by the GSMA at this year’s Mobile World Congress, to help accelerate the adoption of RCS.

Meanwhile, vendors pointed to the complexity of developing end-to-end IP-voice services based on VoLTE as one reason that trials are currently taking up to 12 months. Most remained optimistic, however, that large-scale VoLTE implementations would emerge in the next two years, whereas the majority of mobile operators believed that VoLTE would take longer than two years to achieve significant scale.

Most of the mobile operators surveyed did not see RCS as mandatory alongside the deployment of VoLTE, although many saw a combination of the two as being a means of remaining competitive against over-the-top players such as Skype and Google. Others, including Canada’s Rogers Wireless who are already partnering with a number of OTT players, believe that IMS can provide a platform for greater co-operation between mobile operators and web-based multimedia providers.

Meanwhile, fixed-mobile convergence and PSTN network transformation continued to generate interest. Converged operators in particular saw positive benefits in the ability of IMS to provide service differentiation, and to blur the boundaries between fixed and mobile services and alleviate churn through service bundling.

The overriding impression is that while the future of IMS still hangs in the balance, the adoption of VoLTE and the latest push to commercialise RCS have at least extended the window of opportunity for IMS, and at best will provide fresh impetus to a technology that promised much but has so far fallen short in its delivery.

Tiscali has announced plans to deploy a new, single platform IMS network in conjunction with ZTE

Italian telco Tiscali has announced plans to deploy a new, single platform IMS network in conjunction with Chinese vendor ZTE. The first three commercial sites – slated for Cagliari, Rome and Milan – will be launched by the end of May 2011; Tiscali subscribers will be migrated to the new platform by the end of the year.  According to Tiscali general director Luca Scano, this is part of the telco’s “strategic orientation towards fixed-mobile convergence”.

The imminent arrival of full-on LTE networks is widely viewed as a driver of IP Multimedia Subsystem (IMS) uptake. The technology’s capacity for enabling the speedy deployment and creation of rich new services and applications makes it an ideal partner for LTE and carriers looking to stay relevant in a services-heavy market.

IMS’s GSMA-sanctioned role in solving the Voice over LTE (VoLTE) conundrum is pushing it even further up the carrier agenda for 2011; prior to this, operators depending on voice and SMS for as much as 70 per cent of their revenues were reluctant to jump into IMS, regardless of what it promised on the data front. Now, with pretty much all the major players in both the carrier and OEM space in agreement on the way forward for VoLTE, LTE migration is set to increase, resulting in ever-greater IMS adoption rates – music to the ears of vendors such as Ericsson, Nokia Siemens Networks and Alcatel-Lucent, all of whom have invested heavily in the development of the technology.

According to research undertaken by Infonetics, fixed-line network deployments (including those rolled out by mobile operators) drove the IMS equipment market in 2010, while spending on equipment for mobile services was minimal. The arrival of mobile video calling in 2011 from the likes of Vodafone will join with VoLTE deployments such as that planned by Verizon in early 2012 to become key drivers in what ABI research is predicting will be a 100 per cent increase in IMS sales by 2015.

SDPs and IMS have not reached critical mass and in most cases are regarded as a “utility” rather than a premium enabling technology

Vendors and operators recently met in London to discuss business models and the future of Service Delivery Platforms (SDPs) and how these can help the latter increase revenues without growing organically. The topic of SDP has been evolving in parallel with IMS and in some cases their evolution is similar. While both have been referenced as a way to implement new services and generate new revenue streams, neither have reached critical mass and in most cases are regarded as a “utility” rather than a premium enabling technology.

App stores and developers

The discussion on SDP circled around app stores, network APIs and how operators can attract developers to create new applications based on their networks. Although in most cases the primary function of a SDP is to attract developer attention through an operator app store, there were hardly any developers in the SDP conference, confirming the erratic relationship between operators and developers.

A primary function of SDPs is service exposure to third parties and a topic of great discussion was how operators can attract developers to their networks through SDPs. The opinions were highly polarized and a clear representation of market reality: operators care but cannot understand or adapt to the developer mindset. On the other hand, the majority of developers sees operators as an access utility provider and only cares about revenue potential and a route to the mass market. There was even a suggestion that operators should pay developers to come to their networks and develop, but this may be an unproven argument since developers are likely to care about longer-term revenue opportunities rather than a welcome fee.
Operators have traditionally been used to the telco world where they deal with large enterprises and long, complex business agreements. On the other hand, developers are used to the open culture of the Web and responsive services are a de facto standard. Unfortunately for the operators, Apple and Google have now set the standard for app stores and developer communities, making it extremely hard for an operator to establish a community that can go against Android Market and Apple’s app store.

In a way, SDPs have failed to attract developers and deliver successful, revenue generating app stores to mobile operators. However, there are other market segments where SDPs can be – and in several cases are already – successful.

Several operators, including Vodafone, have created app stores targeting enterprise customers and vertical segments rather than individual subscribers. By doing so, mobile operators target the premium segment and do not have to form relationship with small developers or change culture. Targeting these segments have several advantages compared to consumer app stores: preferred partners can develop high quality services and applications which can even adhere to SLAs; clients can customize mobile services according to their needs and operators can further penetrate existing enterprise clients to increase revenues without organic growth. This usage model for SDP is proving more lucrative to mobile operators and is meeting with more success compared to the app store model.

Operators: Where’s the money?

Mobile operators can arguably enjoy several benefits after deploying a modern SDP: expose services and network functionality, attract developers and create new services rapidly and being ahead of competing operators. However, as with all infrastructure components, there are incompatibilities between different vendors, proprietary interfaces and not every standards-based protocol implementation is similar between all vendors. This causes concerns for mobile operators who may not want to be tied in with a single vendor due to the volatility and rapidly changing nature of the services market. Nevertheless, the most successful SDP references are presented by operators that deploy SDP services in a single country, in order to address specific market segments and user requirements. These operators have the experience to grow their SDP offerings across their international footprint and address a much larger subscriber base. Mobile operators in this category include Telefonica, TMN, Vodafone, Telenor and Orange.

Operators argue that the Return of Investment (ROI) of a SDP is difficult to calculate because it is not clear what services or applications will be successful. Moreover, app stores and service exposure may not justify the cost of a new platform, a potential barrier for the adoption of SDP within an operator. Nevertheless, SDPs are most suited to satisfy subscriber segments where legacy solutions are either not cost efficient or applicable. In these cases, SDPs can provide quick ROI and a serious competitive advantage against other mobile operators that cannot provide similar services.

Opportunities for SDP in mobile

Informa expects that the SDP market will become a long-term strategic objective for mobile operators and vendors will continue to evolve their product lines but implementing semi-proprietary protocols. Mobile operators argue that deploying a multi-vendor SDP across different markets can’t be discussed before the SDP service business model is proven. Moreover, vendors have started promoting SDPs that run from a cloud but operators were also skeptical of this.
Overall, Informa expects the following list to be the main interest of operators in SDP in the short term but there will be several cases where mobile operators deploy such a platform to cater for specific segments or user groups.

App stores: Niche, specialized app stores are more likely to be successful. These include enterprise or vertical segment app stores where SLAs may be available.

Service exposure: Network APIs for preferred telco-grade partners are more likely to be successful compared with developer communities due to the culture of the operator.

Policy control and subscriber data management: A SDP can act as a service enabler for both policies and subscriber data. For example, a SDP can be used to optimize data for a user that is about to exceed a monthly allowance or enable a new service for a premium user in realtime.

Turk Telkom taps ZTE to upgrade fixed network

Turkey’s incumbent fixed line carrier and Europe’s fifth largest operator has tapped Chinese equipment vendor ZTE for what it claims is the world’s largest ever fixed network replacement contract.

Under the contract, which is for an undisclosed sum, ZTE is the sole supplier of core network equipment and services for Turk Telekom’s nationwide all-IP network transformation project, delivering 17.5 million lines over more than 31 sites, replacing the ageing PSTN kit.

ZTE will be providing an IMS (IP multimedia subsystem) core network, service platform, MSANs (multi-service access nodes) and large-capacity trunking gateways, allowing Turk Telekom to launch converged services including VoBB (VoIP over Broadband), VCC (Voice Call Continuity), Converged One Number, Converge Centrex, UMS (Unified Message Service), MMS (Multimedia Messaging Service), MRBT (Multimedia Ring Back Tone) and NP (Number Portability).

Turk Telekom is the largest fixed line carrier in Turkey with over 5.8 million subscribers at the end of March 2010 and over 16.4 million fixed line voice customers. The company also controls Turkey’s smallest mobile operator, Avea, with 11.6 million subscribers at the end of March.

Alcatel-Lucent loss widens in third quarter

Joint venture infrastructure firm Alcatel-Lucent said Friday that net loss for the third quarter of 2009 widened to €182m, compared to a loss of €40m in the same period in 2008.

Revenues also fell from just over €4bn in the third quarter of 2008 to €3.7bn in the same period 2009, driven by a shortfall in carrier infrastructure sales, particularly 2G wireless access.

For the third quarter 2009, revenues for the Carrier segment were €2.23bn, a decrease of 14.6 per cent compared to €2.6bn in the year-ago quarter and a decrease of 6.4 per cent compared to €2.4bn in the second quarter 2009.

Wireless 3G growth was offset by a strong 2G decline, optics were impacted by a decline in terrestrial, while submarine networks enjoyed another quarter of strong growth. IP routing revenues were up and fixed NGN and IMS reported strong growth, albeit off a low base.

Chief executive, Ben Verwaayen, said: “We have achieved significant operational progress. We are rapidly reshaping our cost and expense structure, having achieved 80 per cent of our €750m target in annualized savings year to date. Against what remains a challenging market environment, we reiterate our view that our addressable market should be down between 8 per cent and 12 per cent at constant currency and that we will achieve an adjusted operating income around breakeven this year.”

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With the recent explosive growth of mobile broadband, operators are facing a range of new business and technology challenges to maintain profitability and prepare for an even brighter future for packet data services. The paper focuses on the impacts on mobile packet core networks of the various challenges. These include driving down CAPEX, reducing packet core OPEX, incorporating functionality supporting service aware business models, smooth evolution of core architectures to 4G, moving service & transport layer architectures towards All-IP & IMS, and transforming core and service layers to support relevant radio access standards. 

Click here to download this whitepaper:  Trends-in-packet-core-networks

Just when you thought IMS had dropped off the map, Spanish carrier Telefonica has tapped Chinese vendor Huawei to deliver a Service Delivery Platform (SDP) for its Latin American operations.

The SDP platform, to be commercially launched during the first half of 2009, allows Telefonica to deliver value added services and eases the process of implementing new services such as universal email, mobile newspapers, 3G messaging systems or mobile advertising.

The SDP also opens up the possibility of offering converged services, for both fixed and mobile networks, as well as for residential and enterprise markets.

The carrier reckons it will greatly reduce time-to-market; operational expenditure (OPEX) and capital investments (CAPEX) related costs.

Under the agreement, Huawei will provide a service oriented architecture (SOA) based centralised SDP solution to serve whole of Latin America, including 13 countries. This platform can then be leveraged by third parties to develop new services and implement them faster.

“This platform allows us to integrate a seamless range of services for different networks and countries, so we can continue leading innovation for the mobile market throughout the Latin American region”, said Luis Miguel Gilperez, director of mobile business, at Telefonica Latin America.