Wireless Infrastructure Newsletter
5G is impossible without full convergence November 21 2016The Wireless Broadband Alliance (WBA), in partnership with Maravedis-Rethink, has published its Annual Industry Report for 2016, revealing that the Internet of Things (IoT), the hyper-dense network and 5G will not be economic or practical without the convergence and coexistence of licensed and unlicensed technologies.
Business Models Enabled by Heterogeneity November 15 2016The introduction set out a picture of the wireless world, in which many types of spectrum and network increasingly work together to create a seamless pool of capacity for service providers, enterprises and consumers to use.
The Road to Network Convergence November 08 2016
A year ago, when the Wireless Broadband Alliance announced its Vision 2020 program, it was moving away from a specific focus on Wi-Fi, and towards a far broader platform based around many unlicensed spectrum bands and technologies. This recognized the fundamental and exciting role that unlicensed spectrum will play in pushing the boundaries of wireless experience and business cases between now and 2020; and in the platform that becomes 5G.
Unlicensed spectrum technologies have come a long way from being the disruptive younger sibling of the licensed-band networks, to having an equal place at the table. Indeed, this year’s upcoming WBA report looks beyond unlicensed spectrum on its own, and towards the rising levels of convergence with licensed technologies, to enable new performance levels and flexibility for service providers of all kinds.
Coexistence, and increasingly, full convergence will drive the next generation of wireless technologies, along with some key enablers of the heterogeneous network (HetNet) – network virtualization, new management techniques such as self-optimizing networks (SON), flexible approaches to spectrum licensing and aggregation.
Without convergence, the Internet of Things, the hyper-dense network, and indeed 5G will not be economic or even practical. These are three cornerstones of new emerging business cases for wireless service providers, whether mobile operators, pure-play Wi-Fi or machine-to-machine operators, or wireline carriers with a wireless element to their platforms. All of them will depend on different unlicensed technologies coming together, and often working with licensed networks. For instance, for the IoT, over two-thirds of operators expect to deploy two or more different technologies in parallel.
Converged networks will enable or enhance many business cases which rely on massive IoT connectivity or on hyper-dense data networks. Many of these will be seen in the context of the smart city, a key area of focus and activity for the WBA in 2016, and this year’s report devotes a full section to the massive potential of these environments to drive social and economic improvements, and in so doing, to influence future wireless technology roadmaps.
Those roadmaps will lead eventually to 5G – not just a radio upgrade, but an end-to-end platform, spanning the core to the edge of the network, and a top-to-bottom one, from the radio to the applications layer. Current developments in the Wi-Fi market, including the next wave of 802.11 standards and moves towards virtualization, will feed into this new platform alongside those from the cellular and M2M worlds. The result will be a flexible, radio-neutral 5G environment in which a whole new generation of business models will be able to thrive in unlicensed as well as licensed spectrum, building on a long history of innovation in the Wi-Fi community.
Join us at the Wireless Global Congress in San Jose November 14-17, 2016, to learn more about the WBA’ vision in this four day event, featuring a two day conference programme and two days of membership meetings and invitation-only sessions.
The end of hardware as a mobile business October 14 2016
Exploding handsets aside, Ericsson’s crisis shows the need for all players to accelerate their shift towards software and services
It’s been another week of exploding smartphones, and the growing fall-out from the problems with Samsung’s Galaxy Note 7. Once a flagship product and a genuinely innovative design, the latest Note has turned into a nightmare. Samsung has halted production and the recall and refund process – and more importantly, the loss of future sales – may hit its profits to the tune of $5.3bn.
Of course, Samsung is a big enough company to weather this storm, despite the awful timing, just as its handset business seemed to be in recovery mode. This will likely see it redouble its efforts to shift revenue and profit to non-smartphone businesses like memory, processors and displays, and to try to boost its efforts in software.
The trouble is, while the company is having some success with services like mobile payments, the classic software/content model for a device maker is to use those services to drive additional usage, and upgrades, to the smartphones, by creating an optimized and highly usable experience. Apple is the star at this, and the failure of the new Note – whose pen interface can support some interesting applications – will be a blow to Samsung’s hardware/software hopes.
Google is also chasing that integrated device/services dream with its new Pixel smartphones, just when the model is set to decline. The ascendant players will not be the hardware/software providers, which lock users into a particular device or brand. They will be the web content and applications firms, which can create a differentiated and attractive user experience across a whole range of current and future gadgets.
Amazon is leading the way, because this is its natural territory – despite the Kindles and Fires and Echoes, it is not a device maker and those products exist purely to drive more usage of its content and stores. That also gives Amazon a whole different approach to margins compared to actual hardware manufacturers. As it hurls its rocks at Apple and Samsung – it new low cost music streaming service, tied into its Echo and Prime platforms, is the latest example – it is even more strange that Google, which could go head-to-head in this game, is being distracted by the old-fashioned world of devices.
It isn’t just the device end of the mobile market where the old guard are being squeezed out. Network vendors and operators are faced with painful adjustments too – Ericsson’s huge job cuts of last week were followed this week by news of 3,200 layoffs at Verizon.
Ericsson followed its cuts with a profit warning, turning its investors’ harsh scrutiny on its plan to restructure its business around new realities. Of course, it only has an interim CEO, and a strong new leader is badly needed, but it does have a well articulated roadmap laid out by ousted CEO Hans Vestberg, with a set of targeted growth businesses and a potentially game-changing alliance with Cisco.
However, those growth businesses – which include virtualization, cloud and media – delivered only about $60m of additional revenue in the second quarter, and account for only $1.2bn of sales in a total of $6.1bn. That total is falling (down by $460m in the quarter) and the new businesses are not expanding rapidly enough to fill the gap, hence the cost slashing and general pessimism.
The Cisco deal is not cutting in sufficiently quickly, in terms of sales, to reassure shareholders or many customers, while the new targeted businesses are not greenfield markets where Ericsson can make the rules as it used to do in mobile networks – most of them are already occupied by powerful and defensive companies from IBM and HPE to Amazon. Ericsson has neutralized the potential competition from Cisco and will make other partnerships – or perhaps the big merger it has always resisted really will be on the cards once a new CEO arrives.
Acting CEO and CFO Jan Frykhammar told Bloomberg, after the Q3 profit warning: “This is absolutely not the beginning of the end for Ericsson.” That is likely to be true, even if Ericsson ends up in a merger. After all, its death has been predicted before, most recently in 2003 when its spiralling fortunes were rescued by CEO Carl Henric Svanberg. There is still reason to hope that Ericsson’s next CEO could be as effective as Svanberg in turning the ship, but it will be a big job. As in 2003, the company is not just facing stepped-up competition or seasonal fluctuations – it is in the midst of a complete redefinition of its industry. A decade ago that was centered on the shift to the Internet; now it is about the convergence of telecoms and IT and the rise of the software-driven network and the cloud.
Like Google and Apple, the big RAN vendors are still over-preoccupied with hardware. Of course 5G is important, but the strings of tests and pre-5G announcements – Huawei and Vodafone are the latest to boast of a field trial of the ‘New Radio’, based on preliminary work in 3GPP – do not convince anyone that these companies are ready for the next phase of their industry. Tactile Internet, artificial intelligence, massive IoT, hosted and virtualized RANs, everything delivered from the cloud, network slicing – these will be the foundations of the next wave of mobile and web experiences and business models.
The hardware will need to evolve to support them but it will be an enabler not a business driver in its own right. If Samsung’s exploding phones push the company to step up its software and user experience efforts, it may prove a bonus in the end, and a shift which companies throughout the mobile value chain will need to make too.
WiFi roaming gathers pace in US and beyond September 05 2016
WiFi roaming on a grand scale is the order of the day as a rising percentage of wireless data travels over the unlicensed-band technology, and as a wide range of service provid-ers put WiFi at the heart of their networks.
Just weeks after the Wireless Broadband Alliance (WBA) – the grandfather of WiFi roam-ing – announced agreements to allow movement between 23 operators of city networks, CableLabs, the cable industry R&D organization, pledged to launch a roaming hub for as many as nine US cable operators, by early 2017. That could further accelerate the creation of a nationwide network of cableco-deployed hotspots to supplement the CableWiFi Alli-ance’s huge roll-out.
A nationwide roaming agreement of that kind, which could provide seamless access to many hundreds of thousands of hotspots and homespots, would be a threatening thing for mobile operators, despite their potential use of the network for offload. But it would mini-mize the need for WiFi-first operators – expected to include the largest cableco, Comcast, soon – to rely on cellular MVNO partnerships. That, in turn, would tip the balance of pow-er against the MNOs, in terms of the ability to keep mobile users on their networks to monetize them; and in discussions with cablecos about fees for WiFi offload versus MVNO access.
Mitch Ashley, president of CableLabs’ Kyrio for-profit subsidiary (formerly NetworkFX), said in an interview with FierceCable that his unit expects to launch WiFi roaming ser-vices for up to nine US cablecos in the next three quarters; and that it aimed to sign roam-ing deals between this collective of smaller operators, and the major players, most of which are also members of the CableWiFi Alliance. That Alliance was formed in 2012 by
Comcast, Cablevision, Time Warner Cable, Bright House Networks and Cox Communica-tions and now has about 500,000 locations. Non-member Charter recently acquired TWC and BrightHouse while Altice of France acquired Cablevision but, so far at least, the roam-ing arrangement remain the same.
Ashley said in the interview: “We will connect into members of the Cable WiFi Alliance. We are a complement to it. I don’t see us joining the Cable WiFi Alliance. But we will inter-connect with their members.”
He added: “The WiFi roaming hub is a service that we put together targeted primarily at the mid-tier operators to provide them roaming capabilities across their footprint as well as to larger cable providers. It drastically increases the footprint of a mid-tier operator such as Midco.” Midco is upgrading its public WiFi network in Sioux Falls, South Dakota, to support the hub. Kyrio recently completed technical and field trials of its hub with two other unnamed mid-tier cablecos.
The organization is also in talks with non-cable WiFi operators and Kyrio says it is open to aggregators like Boingo or telcos like AT&T, though it has not signed deals with these companies.
Kyrio will move from its current AAA authentication method to the WiFi Alliance’s Passpoint technology at some point in the future, adding seamless access for SIM-enabled devices and improved security.
To read More, try the Wireless Watch Service.
We tend to take broadband availability and affordability as a given, at least in large cities! That’s not what we found in a recent research we conducted on behalf of the wireless broadband alliance. In fact we found that More than half of world’s urban population has no broadband access. 57% of world’s population are urban unconnected, with 37% of these people living in some of the world’s wealthiest cities like New York or Shanghai.
This report presents the findings of research conducted by Maravedis on behalf of the Wireless Broadband Alliance regarding the state of the urban unconnected population in 18 large cities as well as each of their related international regions.
The conclusions presented take into consideration an analysis of urban broadband adoption at both the city and regional levels.
- The digital divide phenomenon is not limited to rural or remote areas. A staggering 57% of world’s urban population remains unconnected, either with fixed or mobile broadband. That represents more than 2.2 billion people living in cities across the world.
- Wide differences exist in broadband access when comparing metro areas. This means that an important segment of the population inside large cities are being left out of the digital age, either because they cannot afford the service or because the service is simply not available in their neighborhood.
- Large, sophisticated cities are still lagging behind in terms of broadband penetration. Los Angeles, New York City, and Shanghai are good examples. More than 25% of their population unconnected.
- Affordability and social inequality represent the primary obstacles to urban connectivity. Urban citizens still remain unconnected either because they cannot afford the broadband service or the device. The research methodology is explained at the end of the paper.
Findings at the City Level
First, analysis at the city level reveals a huge contrast when it comes to urban broadband access between large cities around the world. Among the cities researched, the lowest proportion of citizens without broadband access is in London (UK) where only 8% or 683,095 of the population is unconnected. However, in Lagos (Nigeria) the portion of unconnected is 88.2% or 10,168,090 people. This demonstrates a wide gap between cities. This is not a surprising result and is well in line with overall regional differences, explained by differences in economic, social, technology and telecom regulatory environments.
The disadvantage experienced by the citizens of Lagos is not surprising at all since the average of unconnected citizens in all the cities examined is just 37%. Also, most of the cities surpassing the average are located in the Middle East & Africa (MEA) and Asia Pacific (APAC) regions. On the other hand, the cities located in more developed regions, such as North America and Europe, and two APAC countries (Seoul and Tokyo) show considerable lower proportions of unconnected, and are below the general average.
Findings at the Regional Level
The analysis of broadband access at the regional level provides results which are consistent with those at the city level. Figure 4 and 5 show the region with the highest proportion of urban unconnected is MEA (Middle East and Africa) with 82% or 515 million unconnected citizens. That region is followed by APAC (Asia Pacific) with 68% or 1.2 billion urban unconnected citizens. This staggering number can be explained by the high proportion of urban population without broadband access in highly populated and countries, such as China and India.
Some operators and vendors insist that, once the 3GPP’s Narrowband-IoT standard is widely deployed, from late 2016, the specialized LPWA (low power wide area) networks will disappear into a niche.
There will certainly be consolidation – there are too many platforms for all of them to survive in the public access mainstream, though some may hang on in private networks. But if the LPWA players can come together to support some common frameworks and allow interoperability, there is a strong possibility that some of the technologies which are being deployed now – LoRa, Sigfox, Telensa and so on – will have a long life, and perhaps gain a migration path into future 5G platforms.
As in broadband data and even mobile voice, an unlicensed spectrum option will be essential – to increase the available pool of spectrum; and to lower barriers to entry for a variety of service providers, thus encouraging proliferation of machine-to-machine services of many kinds. WiFi will hope to provide that unlicensed spectrum platform in narrowband M2M communications as it has in broadband, but its HALOW specification is behind the pack (on a similar timescale with NB-IoT, though the 3GPP system is already benefiting from a growing list of operator trials).
For now, certainly, the proprietary LPWA systems are hanging on in there. Several large cellular operators, including SK Telecom of Korea – also an early triallist and exponent of NB-IoT – have announced large-scale projects based around the existing M2M platforms. This indicates that LPWA roll-outs, despite looming NB-IoT, will not be confined to non-MNOs with no licensed spectrum option, but will be used within a patchwork of networks by cellular providers too, in the same way that WiFi is integrated into their mobile broadband plans. Technologies like LoRa give MNOs a relatively low cost way to move into new IoT services right now, and perhaps to free up their GSM spectrum, the main carrier of the MNOs’ existing M2M activity.
Nordic operator Tele2 (see separate item) illustrates well the mixture of connectivity options and tools which operators will adopt to build M2M services and revenues. SK Telecom is building a nationwide LoRa network, sourced from Samsung. The first city, Daego – Korea’s fourth largest – will go live this month, supporting services such as smart lighting and weather collection.
The largest Korean cellco has said it will invest &84m in IoT projects, from network roll-outs to its own modules, between now and 2019. Like Orange and others, it is planning LoRa and LTE deployments in parallel, addressing different applications according to their urgency, QoS requirements and other criteria. Eventually, operators like Orange have talked about migrating to a virtualized multi-network platform which will enable their first generation roll-outs to converge and interoperate, though that may well be a 5G iteration.
Another operator, Tata Communications of India, is also using LoRa for its M2M build-out in major cities, starting with New Delhi, Mumbai and Bengaluru. While SK Telecom says its deployment will be the world’s first nationwide IoT network, Tata insists its project will result in the largest, in terms of numbers of devices connected to it.
Amit Sinha Roy, VP of marketing and strategy, said the target is to cover almost 400m people though he acknowledged that “the traditional known models are changing and the use cases and revenue models of IoT have to evolve”. He added: “We decided to go for LoRa because interoperability is important for the efficient functioning of the IoT network.”
LoRa is not fully open, as the Weightless standard aimed to be, and its intellectual property is in the hands of its originator and major chip supplier Semtech. But it has a broad Alliance behind it which carries out interoperability testing and certification; a growing set of APIs and other higher layer technologies; and a business model which aligns better with cellular strategies than some of the other LPWA systems like Sigfox and Ingenu. They offer a full managed service approach while with LoRa, MNOs can control their own build-outs and devices, and work on future interworking with LTE.
Proprietary systems have become de facto standards before, and Microchip has given LoRa a boost in that direction with an end-to-end development kit. It contains two LoRa sensor nodes, a LoRaWAN gateway, pre-configured radio modules for 868 MHz or 915 MHz, and local server software.
This saves developers from having to integrate elements from different vendors like gateways, cloud services and mobile apps themselves. Steve Caldwell, general manager of Microchip’s wireless solutions group, told EETimes: “For a LoRa network to work a node must talk to a gateway, which talks to a network server. In the past these elements have involved separate development kits with different providers. To help the ecosystem grow, Microchip felt there needed to be a one-stop solution for developers.”
It is not just LoRa which is standing up robustly to the coming threat of NB-IoT. Sigfox has announced that Finland has become the nineteenth country to adopt its technology, with a new company called Connected Finland adopting Sigfox to deploy networks in large cities, and eventually to cover 85% of the population.
And Sigfox is also working with video game veteran Atari, developing connected devices that runs over the French firm’s network. Those products are currently under wraps, but there are currently 10 different ideas in development, according to Atari CEO Fred Chesnais. The first will be a geolocational luggage tracker, due to appear in the fall, with Sigfox saying its LPWAN tech will be providing location, status reports and button functions to those who license the brand. The mass market categories Atari identifies include automotive (telematics, tracking, panic buttons), family (child tracking, personal safety alarms, asset tagging), pet tracking, sports (activity and route tracking), and travel (luggage monitoring).
Chesnais is very confident in the plan, saying that Atari’s brand is well-suited to being used outside of its traditional games market, and noting that the most ardent Atari users, raised in the 1980s, are now heads of households, with disposable income to spend on such devices.
As it stands, Atari sells very few physical products, mostly just its range of Flashback consoles. It has been licensing its intellectual property, mostly its brand, to companies looking to profit from the association of a video game pioneer – which is currently owned by Atari SA (formerly Infogrames Entertainment), which acquired the company from Hasbro in 2001, and has operated under the Atari brand since 2009. The company has over 100 partners in its various studios – which take on the different apps and ventures, in cooperation with Atari, in amuch the same way that movie and content creators operate, and a plan Atari is extending to its IoT devices.
“Sigfox is transforming the way people are connecting to their objects in a simple and intuitive way. By partnering together and using Sigfox’s dedicated IoT connectivity, we are going to create amazing products with our brand,” said Chesnais, in the official announcement. “We look forward to our collaboration, and releasing new products to the mass market on a global scale.”
Sprint’s owner, Softbank of Japan, is standing by its troubled US child, with founder Masayoshi Son saying that Sprint’s radical capex cuts helped boost its parent’s operating margins by 8.8% in its just-finished fiscal year.
“Cost cutting is going smoothly at Sprint,” said Son during an analyst call. “We’ll see a V-shaped recovery.”
However, his comments did not reassure some analysts. For one thing, Softbank’s operating profit may have improved, but it missed analyst expectations, and the Japanese firm did not offer guidance for the current fiscal year, saying there were too many uncertainties.
For another, Sprint is still heavily dependent on loans from its parent and elsewhere to continue its 4G build-out and its densification program, which is nevertheless likely to be constrained by its deep capex reductions of up to one-third this year – even with Sprint’s promises to adopt a very efficient and flexible approach to site costs, with a heavy focus on small cells.
Sprint has secured $11bn in “total committed liquidity”, mainly via Softbank’s creation of financing vehicles involving Sprint’s network assets and leased handsets, plus a new $2bn bridge loan from Mizuho Bank. Sprint owes $10bn that will come due by the end of 2020 and must make $2.3bn in debt payments this year, while a sluggish junk bond market will make it harder for the carrier to refinance its debt during 2016.
So analysts are still asking difficult questions. Walter Piecyk of BTIG Research flagged up the capex reduction – Sprint now says it will spend about $3bn this year, whereas Wall Street had expected $4.5bn. Sprint had previously issued a capex guidance of $15bn over three years. Piecyk wrote in a client note: “We think Sprint’s aggressive cut to capital investment and continuing lack of evidence on any activity to improve its network raise red flags about the company’s strategy. This low level of capital investment was last seen in 2008/2009 during the financial crisis.”
He added: “While it’s true that small cell investment is largely expensed rather than capitalized, we have observed virtually no evidence of Sprint’s network activity over the past year. Tower company SBA noted that Sprint canceled plans to place 2.5 GHz radios on existing towers.” And the seasoned Sprint watcher has his doubts about Sprint CEO Marcelo Claure’s claim that the bulk of the major network investments were over with the completion of Sprint’s Network Vision network modernization program – itself the subject of many delays and uncertainties. That has now been succeeded by the Next Generation Network program, which is designed to focus on densifying the macro network which was built out under Vision, and on adopting cost effective approaches to sites and backhaul
But Piecyk said the claimed improvements to the network were not showing through in user experience – which would be serious for a carrier which has been dogged by poor network quality and subsequent churn for years, and which has only just started to reverse the flight of its subscribers.
Piecyk wrote: “We have been using a Sprint phone and an AT&T phone for the past few months and find Sprint to be both less reliable and slower than AT&T – and not by the small amount often reflected in the Root Metric scores wireless operators like to tweet about.”
And he is concerned about the bureaucracy that can slow the acquisition of sites for small cells, and Sprint’s reliance on wireless infrastructure partner Mobilitie for its densification roll-out. “As far as we can tell, Sprint’s network strategy is reliant on one company, Mobilitie,” Piecyk continued. “Yet, we continue to hear reports about Mobilitie’s failed attempts (under various aliases) to use rights of ways to locate small cells. We are therefore not surprised that Claure is still talking about zoning and permitting for small cells. This may have worked in Japan (or even for Google in its early deployments of Google Fiber), but we are skeptical that Mobilitie can execute in the United States.”
Mobilitie CEO Gary Jabara disagreed with this assessment and said small cells were “a massive migration away from traditional vendors, traditional technologies, traditional solutions. It’s so much more reasonably priced from a capex experience.”
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