Turkcell uses tri-carrier 3G+ technology to boost speeds even where it is not yet upgrading to LTE
Just as EDGE continued to be enhanced and deployed well into the 3G era, so HSPA technologies have their own roadmap and will complement LTE for many operators - a pattern common in parts of Europe has been to use 4G for urban metrozones while keeping 3G+ for wide area data coverage; other carriers intend to keep stretching their 3G limits in order to defer any investment in 4G for a few years. Ericsson, which has significant market share and IPR in the 3G technology family, says multicarrier HSPA will be an important complement to LTE and will provide "a mobile broadband experience of comparable quality".
The demonstration took place on a commercial network owned by Turkcell, using a Qualcomm-powered smartphone. The three-carrier capability will be included in Ericsson's software release 15A. It is engineered to increase user downlink rates by up to 50% throughout the cell, (compared to single carrier), regardless of network load. This test was performed in the 2.1GHz band, using three 5MHz carriers for downlink and two for uplink.
Turkcell currently has a dual-carrier HSDPA network supporting speeds of up to 43.2Mbps and 5.76Mbps.
3C-HSDPA is designed to allow simultaneous downlink transmissions on up to three 5MHz carriers to a single user. It supports both single-band and dual-band transmission.
EUL-MC, which is included in Ericsson software release 14B, increases uplink speeds by up to 100% by supporting simultaneous uplink transmissions on two 5MHz carriers, regardless of load conditions, and applying to all areas of the cell. Both these HSPA features should be commercially available in devices towards the end of this year.
Swedish giant extends Networked Society Index with interactive website and social media data
Cities not currently included on the list can request to be added to the index, with Ericsson promising to qualify the city's input and then add it to the charts. Links to the data can be embedded in social networks too.
The PR statement tells participants: "You may also play with the data proxies and see what drives a good ranking and at the same time form an opinion on where your city officials should be investing." Although Ericsson is positioning the initiative as an altruistic one, it will also gain insights and contacts to help drive its services and platforms in the city space. It already claims to handle about 40% of global mobile traffic on its networks, and will be looking to add M2M data to that total.
"We believe that the benefit of this interactive map will extend way beyond sharing the information; it will serve as a tool to explore ever-evolving opportunities associated with the connected world," said Charlotta Sung, head of the northern European and central Asian regions of the project - which currently cover 22 cities with a combined population of 314m.
In terms of the metrics that Ericsson uses, the 'triple bottom line' is meant to give an indication of the health of a city. The social ranking looks at healthcare, life expectancy, education, literacy, murder rates and unemployment. The economy aspect charts GDP, productivity, patents per million inhabitants and new enterprises. Lastly, environment looks at rates of recycling, waste, natural resources and fossil fuel consumption. The idea is to indicate how well a city functions without the networking technology thrown into the mix before determining the impact of its current connectivity projects - and then extrapolating the potential if networked extensively.
This is why some cities that have strong TBL scores are dragged down by their ICT deployment scores. But of course the relationship between the health of a city and technology are inextricable: congestion and pollution are better managed by coordinated traffic systems, water quality and waste control are better controlled through real-time monitoring, etc. While this looks like an Ericsson marketing tool, if we can trust the collated data, this interactive index could prove very useful in tracking the deployment of smart city projects around the world.
Ericsson's demo is impressive, but Cambridge conference highlights the far bigger challenges for mobile evolution
Subtitled 'changing the world with wireless', the event was clearly looking to look beyond technology and address both global social issues and new applications for wireless networks. The '5G' word was overused, perhaps inevitably at a conference focused on the future, and one speaker even managed to mention not just '6G' but '7G' - but in general, the program successfully steered clear of esoteric technology debates and focused on the impact of wireless.
Inevitably, that raised more questions than answers. Much-repeated statistics about access to mobile networks being higher than access to clean water did not seem to say much for the priorities of global infrastructure programs; there were interesting but inevitably open-ended debates about cause and effect (mobile phone penetration correlates to increased wealth and productivity in many areas, but our industry is perhaps too eager to claim the credit).
The conference was best when focusing on real world applications, with a host of interesting case studies of mobile devices being used to enable people in emerging economies to communicate and do business in new ways.
"The internet and modern mobile technology enables us to address inequalities between men and women and to drive growth on a global scale as never before," said Cherie Blair, the after-dinner speaker, who has a foundation dedicated to helping women build businesses in developing markets.
The other big theme was the internet of things, and while these sessions tended to focus more on developed markets - and perhaps too much on 'middle class problems' such as opening garage doors without getting wet - there were some common issues. Most notably, that in discussions about emerging market services, or the IoT, wireless technology was sometimes scarcely mentioned. This was about applications and gadgets and business models, with the network purely an enabler and the specific technology incidental.
That is the real context for '5G'discussions. There will be massive technology challenges involved in supporting billions of things and addressing a billion more people in widely scattered locations. Those challenges will be difficult and interesting, and will justify conference sessions of their own - but to a large extent they are understood. Very dense small cells, high frequency spectrum, huge numbers of antennas, new modulation schemes - all these are technically tough to implement in an affordable, commercial way, but they are evolutions of existing work.
The new standards will have to find a way to tap into all these evolutions as they happen, in whatever band and with whatever air interface, in order to support the massive diversity of applications and devices in the future. There were even some eloquent cases made for the emerging notion of keeping GSM in the mix, evolving it as a highly efficient basis for IoT services.
The 'mine's faster than yours' demonstrations in the labs of the big six OEMs already look outdated and, in terms of the critical issues, a sideshow. Doug Pulley, co-founder of Picochip and now CTO of Intel's wireless infrastructure division, nailed it when he said: "Talk of bits/sec/Hz/square kilometer is a vestige of the 3G wars and should be consigned to history." Coming from a wireless engineer this sounded like sacrilege, but it summed up how the mobile industry needs to shift its focus, even while continuing to solve the technical issues behind the scenes.
The big problem., of course, is that networks still need to evolve, which requires significant investment, traditionally from mobile operators, which are rewarded with controlled spectrum. Those operators cannot afford to fund another big-bang upgrade, but if the world shifts towards a true heterogeneous network, with significant non-cellular spectrum, and with a cloud player, perhaps, coordinating all the pieces, it is questionable where the investment will come from, and whether it will be consistent around the world.
Certainly new centers of power may raise a question mark over the role of the 3GPP. If 5G is about end-to-end experience using a mass of technologies, and only peripherally about traditional cellular standards and MNO models, then who will drive it?
If 5G does not prove to rely on a single new architecture or a new air interface, it will have to be defined by a whole mixture of standards organizations, coming from all layers of the network, from apps, and from vertical markets. This is a concerning prospect because it seems impossible that any real cooperation between these interest groups will be possible, certainly given the timescales (the future, as the FWIC event emphasized, is coming closer, with some speakers talking about '5G' roll-outs in 2018, two years earlier than the previously hyped deadline).
And that opens the way for a small clique of large players to take the reins, in the interests of getting things done and bringing mobile benefits to the globe, but with the end result of creating a new power base far stronger than anything the mobile operators enjoyed.
Tim Carter, head of Android business development for Google EMEA, talked from the conference floor about Project Loon, stressing that it is purely experimental at this stage, but he was more direct than any presenter at addressing the elephant in the room for traditional operators. Developing almost any new aspect of '5G' will be very expensive, but their established models do not permit that kind of outlay - so the baton will pass to those firms which still have deep pockets and forgiving shareholders. Carter pointed out that the only organizations which can afford to experiment are "rich people, like Google, and people who have nothing to lose, like entrepreneurs. People in the middle, like carriers, they feel there's pressure on revenues so they feel there's less room to experiment."
Big questions, and the conference did a good job of allowing attendees to step back from clever modulation schemes and antenna configurations, and to ponder the issues of how all that continuing innovation can be used both for the common good, and for profit. Assuming that the real power players will deliver on both agendas, it is unsurprising that Google was mentioned so frequently, but this is not just about carrier models versus web models, or licensed spectrum versus unlicensed - the debate has to consider far bigger questions of economics and control, as the wireless network itself becomes ubiquitous and a utility.
One keynote speaker, Sally Uren, CEO of Forum for the Future, highlighted just how big the changes in thinking need to be, when wireless moves from clever technology for the middle classes, to an essential of life akin to electricity. "There are amazing opportunities out there. We just need to influence the system around us if we are to deliver a sustainable future. We have the technology solutions that could solve problems, but we have to get the last meter, the user experience, right," she said.
Despite calling for higher investment in European 5G programs, Ericsson building new campus to tap into California's innovation
By Caroline Gabriel
Ulf Ewaldsson echoed industry demands for a stronger '5G' agenda and higher funding from the public sector in Europe, claiming the next generation of mobile technology is being driven by the US. Last week, the European Commission announced measures to encourage R&D spending by private firms, and it claimed that "lower levels of private investment", not public sector failings, were to blame for falling behind the US and Japan.
Ericsson, which has been tapping into Silicon Valley's massive R&D ecosystem for years, will not be sending out the signals the EC wants. It faces the dilemmas shared with other European majors. It still spends 60% of its $5bn R&D budget in its home region, but Europe accounts for a falling share of its revenues, and it needs to harness the innovation hubs, start-ups, skills and financing available in areas in the vanguard of key technologies.
Silicon Valley has become increasingly important to telecoms firms as IT has converged with networking, and firms like Ericsson have needed to add software and data center skills to their portfolios. The company set up an R&D center in the area in 2009, expanding its presence there to focus on mobile broadband and converged IP-based products. At the time, head of networks Johan Wibergh said: "The reason we are Silicon Valley is the availability of IP. The engineers in the Valley live and breathe it every day."
Now Ericsson is steadily increasing its investment in the California hub and is building a new campus in Santa Clara which will bring together about 2,000 R&D staff in the areas of IP, TV and media, software defined networking and "mobile innovation" - all key to the company's future growth plans. Some key executives and projects will relocate to the area, including the Ericsson OpenDaylight and Smartphone Labs.
Per Borgklint, head of business unit support solutions, set out the agenda, saying: "Ericsson's new campus unites our rapidly expanding Silicon Valley workforce and creates an environment that will inspire our employees and customers. Together with our customers and partners, Ericsson is driving IP, TV and media innovation, and accelerating development of the media enabled, interoperable and programmable network of tomorrow."
"Ericsson's expansion in Silicon Valley has grown in tandem with the region's increasing gravitational pull on the technology sector," added chief human resources officer Bina Chaurasia. "Our company has a growing need for software engineers and employees with a technology savvy skill set who can partner, create, learn, sustain and innovate; helping us move toward what Ericsson calls the 'Networked Society'."
Such sentiments will not encourage the EC in its bid to put Europe back in the forefront of mobile data technologies. Ewaldsson, in his recent comments, said the firm is seeing diminishing returns from R&D in its home region because of weak public sector investment. He told the Financial Times that this is opening the way for other parts of the world to lead in next generation telecoms. He pledged to "create a bigger agenda in Europe" by releasing information about the level of financial investment and returns it makes there.
"North America is driving LTE and new networks rather than Europe. We can do three to four years ahead, but the public sector needs a longer term vision," he said.
The EC is in the process of changing regulations under which member states can grant government aid to companies for R&D&I (research, development and innovation), with a goal of increasing this spend to 3% of European GDP. The EC blamed "lower levels of private investment" for Europe's lack of 5G leadership but operators point to over-competitive markets, rigid M&A processes and EC regulations in areas like roaming fees, claiming these factors limit carriers' ability to invest in new technologies, compared to peers in the US, Japan and China.
By Caroline Gabriel, Research Director, Maravedis-Rethink
Virtualization and software-defined networking (SDN) have been a significant shock to the system for major wireless infrastructure vendors. They give carriers the opportunity to slash hardware spending by relying on off-the-shelf servers to run network functions, instead of highly priced, dedicated and proprietary boxes. However, the genie is out of the bottle, and the big OEMs are forced to make a virtue of necessity. Ericsson, the most threatened by the shift of spending from hardware to software, has also been the most proactive. It may still have its head in the sand about small cells, but it has placed itself in the vanguard of SDN, determined to shape that trend, not be consumed by it.
The Swedish giant is prominent in standards efforts like OpenDaylight and NFV (Network Functions Virtualization). The latter seeks to shape virtualization technologies, often created for the data center, for the specific needs of carriers. It has been criticized for putting the traditional vendors back in control, but it is being widely accepted by operators as a relatively 'safe' route to virtualizing their critical processes. In a recent study, Maravedis-Rethink's RAN Service team found that almost three-quarters of mobile carriers would deploy NFV in some areas of their commercial systems by the end of 2018, targeting TCO (total cost of ownership) reductions of up to 35% over five years.
Those operator plans, included in a recent research note entitled 'Pace of NFV uptake accelerates despite many risks', are the kind of trends which are driving Ericsson to become a software company, something it highlighted in its quarterly results announcement last week. On the surface, those Q1 figures revealed the usual preoccupations of recent years – balancing profits against revenues, capacity projects against modernizations, all while trying to boost services and Chinese sales. But the wireless giant is undergoing a deeper change, with a shift towards software that is likely to transform the make-up of its revenues, and its key quarterly concerns, over the coming years.
As the software content of mobile networks rises, and carriers toy with full SDN, Ericsson announced that it had reorganized its infrastructure division to create a dedicated unit for virtualization. This reflects a change in focus that has been building for some time – at the annual general meeting recently, CEO Hans Vestberg said hardware accounted for only one-third of Ericsson's revenues in 2013, down from 73% in 1999, while software contributed 23% and services 43%, up from a combined 27% at the earlier date.
One aspect of this change has been the development of networks which rely on software to support flexible design, agile reconfiguration and swift upgrades with limited hardware swapping required. The next step is the move to virtualize network functions entirely in software on standard servers, reducing the need for specialized hardware.
Now Ericsson's new drivers are made explicit in its organizational structure, with the splitting of the Networks division into two parts – Radio, and Cloud & IP. Cloud & IP will drive work on virtualization, SDN and other cloud-based network platforms, while Radio will take care of the traditional products. Both units will still report to Networks chief Johan Wibergh but will get their own separate heads too.
Vestberg said in a statement: "The business logic and Ericsson's relative position is different in the two areas. Radio is the foundation of Ericsson's technology leadership and we are the undisputed market leader, same size as number two and three together. We are committed to maintain our leadership as the market evolves with 5G. In the cloud and IP space, which are vital for the evolution to 5G, we have made significant progress but are still a challenger. In a transforming market we will now intensify our work to capture opportunities in virtualization and cloud, building on our leading position in core networks."
The restructuring will be completed by July, and so its impact on financial performance and reporting will not be felt for a while. But an ever-deeper focus on software should help the company in its quest to keep profit margins high, even if the hefty revenues of proprietary hardware are behind it. In its first quarter, Ericsson put its efforts into boosting profits, at the expense of sales growth, which went down badly with investors. The stock slumped by over 5% - the worst in six months - as the firm reported a 7% year-on-year revenue decline, to SEK 47.5bn ($7.2bn), though net profit was up 41% to SEK1.7bn ($257m).
The worst hit regions in terms of sales were North America – the bulwark of Ericsson's LTE growth in recent years, but with major roll-outs now slowing – and Japan. These declines were offset partially by improved performance in China, where Ericsson is participating in the major TD-LTE deployments of the three cellcos this year, as well as Middle East and Latin America.
The decline in sales was seen in the Networks and Global Services divisions but all segments enjoyed improved operating margins. An increase in gross margins across the board – up to 36.5% of sales, from 32% a year earlier and ahead of analyst forecasts - indicated the success of Ericsson's recent attempts to shift its balance of network deployments from low margin modernization projects, which have dominated the past couple of years and squeezed the company's profits, towards higher value capacity-driven roll-outs.
Gross margin was also improved by lower restructuring charges, increased IPR revenues. Like all the big vendors, Ericsson is pursuing revenues from its large stores of patents more aggressively than in the past, when the assets have often been used mainly for cross-licensing and standards influence.
Ericsson said that some key contracts have been awarded, but their impact will mainly be felt only in the second half of the year. It added that results had been hit by political unrest in some regions, notably parts of the Middle East and Africa plus Russia and the Ukraine. The firm reported SEK5.9bn of sales from Russia/Ukraine last year though the current crisis had not yet impacted sales in Q114.
Mikko Ervasti, an analyst at Evli Bank in Helsinki, told Bloomberg: "It needs to win new sizable projects in order to support the top line. Gross margin was very solid."
"Our focus on profitability is paying off," said CEO Hans Vestberg in a statement. "The business mix in the quarter was predominantly driven by mobile broadband capacity projects."