Written By: Kiran Matty, Marketing Manager (SP Marketing - Mobility Solutions, Cisco)

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Have you ever seen a relevant ad on your mobile device? I for one haven’t had any luck with that yet. Just to level set, I am not talking about mobile search Ads where a consumer’s purchase intention is determined fairly accurately by sophisticated search algorithms like Google Search. This segment of the market is forecasted to account for 50% of the mobile Ad spent by 2016. The focus of this article is the non-search related mobile Display Ads, a multi-billion dollar nut that hasn’t been fully cracked yet.

 

According to IDC, the mobile Advertising market is projected to be $20.5B (worldwide) by 2016 with a CAGR of 32.8%, and the display Ad market is projected to be $6.2B (worldwide) in the same timeframe. People are increasingly spending more time on smartphones and tablets, about 158 minutes per day according to an article that appeared in Venture Beat.

 

But the Path to $$$ might not be as rosy as it seems

 

You’d expect Mobile Ads to command higher CPM, a metric that’s commonly used to price mobile Ads, than other Ad types. An article in the Bloomberg Businessweek has captured the reason pretty well, “smartphones are always with us, know where we are, and collect far more data about us than a desktop PC”.  Not to mention, they are actionable because of proximity to the advertiser in the case of location based Advertising. But, you’d be very disappointed to see that that’s not the case as seen in the below chart.  As for me, I was expecting to see the Mobile CPM to match that of highly targeted Cable. Further, Mary Meeker’s 2013 report on Internet Trends shows that the Mobile Advertising spend is not keeping pace with the amount of time people spend on their mobile phones, and is lagging the spend for other Ad types by a significant margin.

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Source: Cisco Internal Anaylsis

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So, what’s impeding the flow of advertising dollars?

 

Small size of mobile screen and the lousy extension of the desktop Ad inventory to mobile could explain that to a certain degree. However, in my opinion, lack of “contextual relevance” is what’s making Mobile Ads miss the mark with the subscribers. This can be attributed to:

  • Internet Cookies, which are extensively used for behavioral tracking on the desktop, are not supported on majority of the mobile devices.  However, iOS and Android do support device IDs for tracking, but again that solution is not universal due to device fragmentation.
  • The commonly used Mobile Ad targeting technique based on Mobile IP fails to provide the granularity that is required for hyper targeting. Hyper-targeting can lead to a 2.4x increase in mobile advertising revenue potential according to a Cisco Internal analysis.
  • Although GPS provides the most accurate tracking, it might not be ON all the time due to battery drain caused by periodic app updates. On the other hand, a cellular network knows your location all the time, albeit not as accurately as GPS.

 

Data in Motion provides contextual awareness

 

Before we delve into the nuts and bolts of Data in Motion, lets go through an interesting use case that was showcased by Cisco at the Mobile World Congress 2013. A city could be divided into Ad Geo-fences (a virtual boundary that’s created programmatically to take actions based on policies that are set by the Advertiser) so that Ads that are pushed to a digital signage on the side of the bus are contextualized based on the geo-location. For e.g. an ad showing a low interest-rate student loan or a value meal at a local Italian restaurant would engage more eyeballs in a university area, whereas an Ad showing an offer from Saks Fifth Avenue would work the same magic in the financial district of the city. If you throw QR codes into the mix, the Ads become actionable. Moreover, an Ad Network could use network congestion analytics provided a network operator to serve up rich media Ads, which have higher CPM, if the network is not congested.

 

Network data, Policy, and Analytics interplay in a multitude of ways to add contextual relevance and personalization to mobile Ads.  Rest assured! I am not going to break out into a “Big Data” song. On the contrary, I am talking about the wealth of data that resides in a Mobile Operator’s network and has been grossly untapped thus far. It can be mined with minimal latency to create a context vis-à-vis location, proximity, media and browsing behavior, etc. and is mostly “real-time”.  Once the context is established, targeted advertising fits in very organically. Out of the several data points that a mobile network could expose via API, a few that are pertinent to targeted advertising are past internet activity and app usage data, subscriber info (gender, zip code, data plan, data quota), viewing behavior, device type, location (IP address and cellular location,), and more.  What further differentiates these data points is that they are OS, browser, and device agnostic. These data points can be very potent when combined and correlated in conjunction with subscriber and network level Policies, and Analytics in real or near-real time through a highly Programmable Network.  That’s not all! One could mash-up this data with other unstructured data such as Twitter Feeds, Facebook posts, and structured data such as Google Maps, 3rd party data from credit reporting agencies such as Experian, In-Store data to create valuable insights and compelling applications. This is what underpins Data in Motion and is something that can differentiate a mobile operator in the crowded “Big Data” space.

 

Mobile Operator Strategies to capitalize on the Data in Motion opportunity

 

  • Privacy concerns are rife in this space, just like any other big ideas related to “Big Data”. Anonymization and in some cases Aggregation of network data is very critical to allay those concerns.  Further, an operator’s relationship with its customers is very valuable; hence opt-in and opt-out mechanisms should be put in place for marketing programs.
  • The data provided by an Operator is limited to the operator’s subscriber base and their geographic footprint, which might not scale well for certain Ad campaigns that need a wider reach.  A business model around Federated Data, something similar to Weve ( a joint venture between the UK’s three largest mobile network operators (MNOs) – EE, Telefonica UK (O2) and Vodafone UK covering 80% of the UK’s mobile customers) would help address this issue.
  • An operator who would like to see their mobile network transform into a service innovation platform would have to garner the support of the wider developer community. The rise of Android and iOS application ecosystem has taught us the existence of a virtuous cycle:

More Developers --> More Services --> More Subscribers --> More Advertisers --> More $$ --> More Developers , and so on. Hence, an operator not only needs to expose the capabilities of its network via APIs, but also enable a strong developer ecosystem through developer programs similar to AT&T’s

  • Operators should lead with a few compelling use cases around Data in Motion such as Sponsored Data, Advertising Geo-fencing, etc.

 

Cisco Quantum™ enables Data in Motion

 

In conclusion, adding contextual relevance to mobile Ads through Data in Motion would significantly boost the CPM of those Ads.  Our analysis indicates that targeted mobile Ads have 2.4x higher CPMs than non-targeted Ads. Above all, engagement rates would go up materially leading to higher Ad spend for Mobile. With Cisco Quantum™, which consists of best of breed Policy, Analytics, and Network Abstraction Suite, Cisco is well positioned to enable a Mobile Operator quickly monetize their network assets by becoming a valued partner in high growth value chains such as Mobile Advertising.

Wi-Fi networks seem to now be everywhere.  Once primarily confined to the home or office, we now expect Wi-Fi access in coffee shops, hotels, airports, stores and even in sport stadiums.  Not only are these Wi-Fi networks providing valuable Internet access to appreciative mobile users, they are collecting massive amounts of useful information.  Innovative businesses and operators are now learning how to unlock this valuable information to turn Wi-Fi networks into key enablers of business value.  We have identified eight technical characteristics of Wi-Fi networks that can help to deliver real value to the bottom-line:

 

 

1.   Recognizes All Wi-Fi Enabled Devices

Recent research by Cisco IBSG shows that consumers have an average of 2.6 mobile devices, most of which are now Wi-Fi enabled.  These devices are constantly signaling of their existence to Wi-Fi networks.  As a result, Wi-Fi access points are constantly collecting information on these devices and the movements of their owners without users having to authenticate on the network.  This means that venues are collecting information on a large number of people at an – effectively anyone who enters with a Wi-Fi activated mobile device in his pocket.  However, this does not raise personal privacy issues because only the MAC address of the device is collected and the information is aggregated across all users.

2.   Hyper-Sensitive Location

Triangulation from the access points can currently locate a mobile user to within 3 to 4 metres.  However, new technologies will make this even more accurate, down to 1 to 2 metres.  This means that location targeted advertising can be extremely sensitive to locations within a store or to specific stores within a shopping mall.  Equally, accurate and useful mapping and other location-based services can be offered to customers.

 

3.   Capture Device Information

By capturing the MAC address, the Wi-Fi network is collecting valuable information on the user’s device, such as type, manufacturer and the speed it moves about the venue.  This information allows businesses to vary their offers, advertising messages, services and customer experience by device type. 

 

4.   Identify Returning Customers

Capturing the MAC address of the different devices also allows the Wi-Fi network to identify returning customers, including the frequency, interval and the duration of their return visits.   This valuable information allows businesses to differentiate offers, advertising messages, services and customer experience between new and loyal customers.

  

5.   Sophisticated Path Analysis

Data analytic tools by Cisco allow sophisticated, user-friendly analysis of the extensive valuable data collected by the Wi-Fi networks.  These tools can display detailed maps and information of where and when people move about a venue.  Airports are using this to improve their operations in real-time and identifying opportunities to remove bottlenecks to the flow of travelers.  Equally, shopping mall owners are using it to justify different rents in the mall based on the amount of footfall in front of different shops.

 

 

6.   Advanced Filtering

Advanced filtering allows business users to drill down on the data and analytics that are most relevant to their business.  For example, users may want to identify the percentage of people who spent more than 10 minutes in a specific part of your store or shopping mall to evaluate the effective of their in-store merchandizing or marketing campaigns.

 

7.   Push Information to the Browser

Advanced Wi-Fi networks now have the ability to push information to the browser of the mobile device, giving the user the ability to accept or reject it.  This powerful capability means that businesses can now deliver targeted and rich messages directly to the browser, rather than just messages or banner ads.  Not only does this offer the ability to deliver much richer information, but the customer is much more receptive to receiving it.

 

8.  Analytics On Anything Happening on the Network

Future capabilities, currently under development, will allow business users to analyze anything that is happening on the Wi-Fi network.  For example, show me where those people using Facebook spend their time in the venue, and how often they return.  Or, show me where people are surfing price comparison sites in the store.  Imagine the value to a retailer of then being able to automatically push a price-matching offer to that price sensitive customer? 

 

The recent white paper (Wi-Fi: Service Providers Can Make Money with New Business Models) by Cisco IBSG describes the viable Wi-Fi business models for turning these technical capabilities into true business value. 

 

We are only just beginning to mine the valuable data available from Wi-Fi networks.  Innovative and pioneering businesses are showing us what can be done and the true business value that can be extracted from Wi-Fi Big Data.

 

This is blog 4 of a new blog series Trends in Mobility on the Cisco SP Mobility Community. Read the next blog post for this series

Trends in Mobility #5: Mobile Business Users Connect with Wi-Fi By: Stuart Taylor

 

About the Author

Stuart Taylor's further industry research, insights, and perspectives can be found at his blog, The Connected Life

Follow Stuart Taylor on Twitter: @STaylorCisco

 

More Resources

Trends in Mobility #1: The Next Generation of the Internet is Mobile By: Stuart Taylor

Trends in Mobility #2: The Future of the Mobile Industry By: Stuart Taylor

Trends in Mobility #3: The Mobile Paradox By: Stuart Taylor

Trends in Mobility #5: Mobile Business Users Connect with Wi-Fi By: Stuart Taylor

White Paper: The New Mobile World Order - Perspectives on the Future of the Mobile Industry

POV Paper: The Next Generation of the Internet Revolutionizing the Way We Work, Live, Play, and Learn (PDF)


Today’s world is characterized by what I call the “mobile explosion”—an environment defined by mobile cloud becoming a platform for delivering everything. It is a world of heterogeneous networks, licensed macro small cell networks, and unlicensed small cell networks (Wi-Fi for example), all seamlessly combined. In this world, however, I believe we are facing a mobile paradox: on the one hand, there is a staggering demand for data from our smartphones, tablets, and other connected devices; on the other hand, the telecommunications industry is grappling with business and monetization challenges around profitability, how to build up these networks fast enough, and competition from over-the-top (OTT) operators.  But, operators are struggling with building the business case and understanding how to make Wi-Fi pay.

 

The much quoted Cisco Visual Networking Index (VNI) predicts that global mobile data traffic will increase 13-fold from 2012 to 2017, reaching 11.2 exabytes per month. In parallel, the use of unlicensed small cell networks (Wi-Fi) for Internet access is exploding as more mobile devices are Wi-Fi-enabled, the number of public hotspots expands, and user acceptance grows. Until recently, most technologists and mobile industry executives viewed Wi-Fi as the “poor cousin” to licensed mobile communications.  And they most certainly never saw any role for Wi-Fi in mobile networks or their business. The explosion of mobile data traffic has changed all of that. Most mobile operators now realize that offloading data traffic to Wi-Fi can, and must, play a significant role in helping them avoid clogged networks and unhappy customers.

 

In the “Business Models and Monetization Video” in Big Thinkers in Small Cells, my colleagues and I discuss revenue opportunities and challenges mobile operators face today with small cells, both licensed and unlicensed. Mobile operators understand the business case behind offloading data traffic to cheaper Wi-Fi—deferring significant capital expenditures for further build-out of the licensed network.  However, operators around the world are asking if there is more to Wi-Fi than just data offload (the simple answer is “yes”). Or, more appropriately, how do they actually make money from Wi-Fi—turning a cost of doing business into profitable business models?

 

The Cisco Internet Business Group (IBSG) has identified and built business cases with service providers around additional ways to benefit from Wi-Fi, beyond data offloading. Our recent white paper (Wi-Fi: Service Providers Can Make Money with New Business Models) describes each of these business models in more detail – laying out the economics and providing case studies of success operators. 

 

As the pervasiveness and customer adoption of Wi-Fi continue to grow exponentially, these new business models provide meaningful opportunities for service providers. For example, we are seeing home broadband providers improve their customer retention by 10 to 15 percent by bundling their broadband service with access to free public Wi-Fi. In addition, we believe that operators can generate $10 to $15 per business user monthly by establishing a Wi-Fi-enabled “Business Anywhere Service.” Or, the could drive an incremental $100-$150 per retail store by delivering enhanced, value-added retail experiences, on top of the $50-$250 that operators charge per wireless access point to run a managed Wi‑Fi service for retailers. 

 

But, don’t just take my word for it. End users tell us that they want these new Wi‑Fi business models and truly see value in them. Unique Cisco IBSG customer research revealed that mobile users not only appreciate the lower cost and unlimited data usage of Wi-Fi, but also greatly value the flexibility and convenience that it offers. In particular, customers were very interested in the national/international roaming business model and the Wi-Fi value-added retail offering that would make them more efficient, save them money, and enhance their shopping experience. Remarkably, among U.S. broadband subscribers we surveyed who have free public Wi-Fi as part of their subscription, 61 percent said the inclusion of Wi-Fi was “very” or “extremely” important in their choice of broadband provider. Wi-Fi is a good way not only to attract subscribers, but to keep them as well.

 

Of course, not all business models are attractive to all service provider segments. In addition to aligning the business models to different industry segments, providers need to set priorities and plan where to start. 

 

We feel that Cisco IBSG’s research, insights, and approach arm SPs with guidelines for setting priorities and determining which approach is best for making real money from all small cell technologies. Click here to learn more about what additional Big Thinkers in Small Cells have to say about Business Model and Monetization Opportunities.

 

This is blog 3 of a new blog series Trends in Mobility on the Cisco SP Mobility Community. Read the next blog post for this series Trends in Mobility #4: Wi-Fi Technology Delivers New Value to Service Providers

 

About the Author

Stuart Taylor's further industry research, insights and perspectives can be found at his blog The Connected Life

Follow Stuart Taylor on Twitter: @STaylorCisco

 

More Resources

Trends in Mobility #1: The Next Generation of the Internet is Mobile By: Stuart Taylor

Trends in Mobility #2: The Future of the Mobile Industry By: Stuart Taylor

Trends in Mobility #5: Mobile Business Users Connect with Wi-Fi By: Stuart Taylor

White Paper: The New Mobile World Order - Perspectives on the Future of the Mobile Industry

POV Paper: The Next Generation of the Internet Revolutionizing the Way We Work, Live, Play, and Learn (PDF)

The deployment of small cells is gaining interest in the Middle East region, particularly within the Gulf Cooperation Council (GCC) nations. Operators such as Etisalat and du in the United Arab Emirates (UAE), Zain in Kuwait, and Ooredoo (Qtel) in Qatar have already successfully tested femtocells and have announced deployment plans. However, these are still early days for the technology in the region.

 

One of the prime reasons for the as-yet sluggish growth and uptake of small cells has been the absence of a sound business case that adequately covers all parties, both operators and end users. Traditionally, the developed markets have taken to the small cell as a way to offload peak mobile capacity over fixed networks. Somewhere, tucked behind the corner in this business case is the element of enhancing indoor coverage as well, but offloading continues to occupy the primary focus.

 

The reason is simple; operators have been struggling with massive capacity crunches caused by the proliferating use of smartphones over 3G/Long Term Evolution (LTE) mobile networks. Some examples:

 

  • AT&T USA"3% of its customers account for a whopping 40% of the traffic on its network." (Source)
  • O2 Germany"[The operator stated that its] network capacity is under stress in certain locations and would lead to decreased performance in both telephony and mobile data." (Source)

 

In such a situation, small cells proved just the solution that operators were looking for to partly solve their capacity problems. Some examples:

 

  • Telefonica Spain"Telefonica is moving towards street-level picocells and femtocells." (Source)
  • Telstra Australia"Telstra [looking] to combat congestion with small cell networks." (Source)

 

The situation in the Middle East, however, is quite different. With the countries generally covering smaller areas and possessing a relatively small number of subscribers (when compared to some of the developed markets), network congestion is not as big an issue in the region. To add to this, most operators in the region are already running 3G services and several have launched LTE networks. So the 'network congestion' business case does not resonate in the region in quite the same way it does in the West.

 

However, what does ring a bell in the region is coverage and, therefore, an 'indoor coverage'-driven small cell business case. To better understand this, let's look at the spectrum bands currently in use (or planned to be used) in the region for LTE:

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As is apparent from the above table, most of the ongoing LTE activity (with the exception of Qatar) is in the high spectrum bands. However, these higher spectrum bands that are hosting the LTE networks have an inherent limitation; they do not penetrate buildings, leading to patchy indoor coverage. Mobile broadband is used mostly by consumers as a standalone broadband connection, and so they expect full utility from their connections – indoors, as well as, on the move. In the current setup, the high-frequency deployments can lead to poorer in-building connectivity and, thus, erode customer experience.

 

It is here that small cells enter the equation. To meet the growing customer demand, operators are looking at investing in expanding indoor networks by using small cells. But while undertaking such deployments, operators need to broadly address some key issues associated with small-cell deployments, including spectrum allocation (femtocells require additional licensed spectrum) and signal Interference (potential signal interferences caused by femtocells). The issues combine to make the technological business case for small-cell deployment.

 

Once the technological business case has been firmly established, the operators then need to evaluate the customer deployment business case, namely: "Who Pays [for the small cell]?"

 

The core of the "Who Pays?" argument relates to the party that should pay for the deployment and maintenance of the small cells. Customers expect ubiquitous coverage, whether indoor or outdoor. That's what they believe they are subscribing to when choosing a particular operator's SIM card. As such, 'paying' extra (to deploy small cells) for better indoor coverage does not go down very well with the users. On the other hand, the operators' argument is that any subscriber wanting a superior service quality (i.e., much better indoor coverage) should be willing to pay a premium for it.

 

Both arguments have their own merits (and demerits); however, I feel a hybrid approach might be the best way forward. Operators could utilize a commonly used method for pricing mobile devices – the subsidy model – and modify it for small cells. Here, operators should subsidize the cost of the femtocell by bundling it with things such as a mobile handset or data-usage plan, and, let's say, a lock-in period of a year or so. This will not only help boost the uptake of femtocells, but also accrue benefits in terms of assured revenue and customer retention for the duration of the contract.

 

Apart from better coverage, small cells can serve one more important function – the analytics and intelligent services they offer on top of coverage. Small cells, coupled with LTE deployments, could pave the way for future technology trends such as location-based advertisements. From another perspective, advertisements can also be seen as a monetization opportunity for operators that plan to invest in the technology.

 

As mobile broadband penetration increases in the region, small cells can help operators improve network efficiency and coverage. This is not just an opportunity in the consumer segment; it also holds immense importance within the enterprise segment as well, where companies are increasingly focusing on the concept of fixed-mobile convergence, which small cells can help achieve.

 

Learn more about the author: Abhinav Purohit Community Profile

 

Follow Abhinav Purohit on Twitter @PurohitAbhinav

The topic of small cells has been a much discussed in the last few years, in both industry and academia. Despite significant investments in this space, the ecosystem awaits the "pick-up" in volume deployments of outdoor, licensed-band, carrier installed small cells. The leaves one wondering if small cells, in their outdoor, zero-footprint and licensed band operation, are riding a hype cycle.

 

To put the issue into perspective, GSM and 3G "microcells" have been deployed by operators for many years to address network capacity and coverage deficiencies. These were the first types of "small cells": outdoor base stations at low height above ground. More recently, zero-footprint compact base stations incorporating advances in silicon processing and RF technologies to drive the cost of former "microcells" lower through greater integration have become available. The theory goes if small cells are low enough in cost operators would deploy them in volume.

 

But for outdoor small cells this has not happened, yet. Looking at the technical aspect, and leaving aside business case issues which are in no way less important, a number of issues arise to challenge the mass-scale deployments of small cells. One of the major challenges is self-organizing network (SON) capability in the true and original sense of this definition. Here, by SON I mean the ability to optimize network performance automatically and without human intervention. For a wireless network, this means the ability to optimize network parameters to control interference which has a major impact on performance. It also includes the ability to manage the traffic load on different radio access network elements to provide the user with the best possible service while keeping tab on overall network performance.

 

When it comes to true SON, I think we are still in the early days. The wireless network features complex interactions between base stations. In the traditional cellular network architecture, this was an interaction between equals: base stations of relatively similar transmit power and coverage area. Adding a small cell layer underneath the macro cell layer increases the complexity of managing the performance by orders of magnitude. The small cells have much lower output power and coverage area. Interference and load can vary significantly at any particular moment. In fact, placing a small cell in the wrong spot reduces network performance.

 

The complexity is also represented by quantity and variety of data which is spewed out from different network elements constantly. Here, we enter the realm of big data where traditional ways of handling network fault and performance metrics are no longer sufficient in the era of heterogeneous networks, particularly as network 'events' would set to increase dramatically. Fast, automated optimization algorithms become necessary to help the operator in the gigantic task of network optimization resulting from the volume deployments of small cells. In this regards, machine learning techniques would need to be implemented to predict the performance of the network given changes in certain parameters.

 

SON facilitates the integration of other type of small cells such as indoor residential femto cells, remote radio headends in cloud RAN deployments and Wi-Fi access points. But what happens if these elements are provided by different vendors? Already we see gaps in the implementation of the X2 interface, a major conduit for SON signaling in LTE networks (while X2 messaging has been standardized, the response of the base station is a vendor implementation option). This makes interoperability between the small cell and macro cell layers questionable unless there is a commitment by equipment vendors to collaborate.

 

As the concept and definition of 'small cells' continues to evolve and expand to include different types of RF transceivers serving a mobile user, the means to manage and optimize the wireless network must keep pace. SON technologies are critical in unifying the different small cell nodes under a single umbrella to simplify the complex process of network optimization and management.

 

So, are small cells riding the hype cycle? Surely, if you expect volume deployments soon. But taking a long-term view, small cells are a catalyst to radically change the way operators deploy and manage networks as well as the way vendors design base stations. Regardless of the hype cycle, significant advancements are being made today that will define the radio access network of the future. In a way, it's a true revolution in the making.

 

For more blog posts by Frank Rayal, visit his community profile

A mobile paradox—huge growth and customer demand, yet significant business and market challenges—is causing many companies in the mobile value chain to question where the industry is heading. They’re struggling to understand the key drivers that will shape the industry and what this new world will mean for them in terms of new challenges and opportunities. Most of all, they want to know the winning strategies for achieving success in this new mobile world.

 

A number of major disruptions, or strategic inflection points, in the mobile industry are radically altering the entire mobile ecosystem as we know it. Some of these disruptions have been slowly building up steam over the last couple of years, although many of these have just started and have yet to really play out. In the white paper, “The New Mobile World Order: Perspectives on the Future of the Mobile industry,” Cisco IBSG identified eight strategic inflection points that are causing—and stand to cause even greater—disruption and uncertainty in the industry:

 

  • Explosive demand for mobile data—a 13-fold increase between 2012 and 2017
  • The rise of software platforms—from “walled gardens to walled ecosystems”
  • Availability of new, fast mobile networks—LTE everywhere and the rise of Wi-Fi
  • A more active regulator in many countries—spectrum, net neutrality, consumer protection
  • Changing industry structure—consolidation and concentration
  • Growth of network connected devices—Internet of Things
  • Move to cloud delivery models—“everything as a service”
  • The rise of the  OTT threat—largely the battle for video distribution and services

 

These disruptors are defining the scenarios of how the future mobile industry may look and operate.  While there are several plausible future scenarios, I believe two key scenarios are both more likely to transpire and are the most informative in identifying key business choices and helping develop winning strategies for future success. The Mobile Segments scenario is primarily a continuation of the mobile world today—large players dominate each segment of the value chain, focusing on their core strengths and capabilities and cooperating with their fellow segment giants. Conversely, Mobile Explosion is a world where most things are wireless, interoperable, and cloud-based, increasing competition and further blurring the lines between the value chain segments. 

 

While it is impossible to predict the future, some  of the current trends and early indicators suggest that the tipping points, or industry drivers, are pushing the industry in the direction of the world of Mobile Explosion. Given this trend, players in the mobile value chain are rightly asking, “What are the solutions to the key challenges and business choices that this new world presents?”  The following are highlights of the paper’s conclusions on the top strategic considerations to ensure future success for players in each of the six key segments of the mobile value chain.

 

·      Content Providers (e.g., Sony, Disney, New Corp.)—multi-platform, cloud-based lockers, and alternative business and distribution models

·      Mobile Service Providers (e.g., AT&T, T-Mobile, Orange, Verizon Wireless)—Wi-Fi integration, OTT collaboration, Big Data, cost and performance optimization, mobile cloud, and vertical solutions

·      Equipment Providers (e.g., Ericsson, Alcatel-Lucent, Cisco, EMC)—cost reduction, network-data center integration, small cell, and multi-network access

·      Software (e.g., Microsoft, Adobe, Oracle)—mobile enablement, mobile cloud, security, and vertical solutions

·      Internet Services (e.g., Google, eBay, Amazon, OTTs)—SP collaboration, cloud, value-chain integrators, and innovation

·      Devices (e.g., Samsung, Apple, Nokia, RIM)—innovation beyond handsets, cloud extension, connected home, and alternative networks

 

This white paper further details the key disruptors and tipping points that will redefine mobility to produce two plausible scenarios for the future of the mobile industry. These scenarios and industry segment assessments provide a framework for mobile industry executives to evaluate their future and rationally evaluate strategic options under different conditions.

 

This is blog 2 of a new blog series Trends in Mobility on the Cisco SP Mobility Community. Read the next blog for this blog series  Trends in Mobility #3: The Mobile Paradox By: Stuart Taylor

 

About the Author

Stuart Taylor's further industry research, insights and perspectives can be found at his blog The Connected Life

Follow Stuart Taylor on Twitter: @STaylorCisco

 

More Resources

Trends in Mobility #1: The Next Generation of the Internet is Mobile By: Stuart Taylor

Trends in Mobility #3: The Mobile Paradox By: Stuart Taylor

Trends in Mobility #4: Wi-Fi Technology Delivers New Value to Service Providers By: Stuart Taylor

Trends in Mobility #5: Mobile Business Users Connect with Wi-Fi By: Stuart Taylor

White Paper: The New Mobile World Order - Perspectives on the Future of the Mobile Industry

POV Paper: The Next Generation of the Internet Revolutionizing the Way We Work, Live, Play, and Learn (PDF)

GSMA's second Mobile Asia Expo ran its second annual Asian event in Shanghai - a rather bold attempt at repeating the magic of the big European mother event MWC, yet, bears the bright stamp of GSMA for sure. The show, I am told, was at least triple the inaugural show of 2012, by area. Key operators in the region - KT, China Mobile, Telstra were the big telecom players participating in full size stalls.

 

Some of the big draws this year was the NFC Roaming deal between Chunghwa Telecom, KDDI and HK's PCCW and a demonstration of the capability: essentially this establishes a closed loop between subscribers of each of these operators who can access NFC capabilities across these three countries. Thus a PCCW user traveling in Taiwan can download an electronic pass or transit card onto his phone and use it on metro railway in Taiwan. A range of services such as bicycle renting services, snack vending machine, gas station payment via electronic coupons will now be possible taking NFC beyond the payment realm.

 

Key mobile operators in the region, KT, Telstra and China Mobile admitted on a panel discussion that they really felt the mobile operator business had to innovate and find new revenue streams as the legacy revenue base was running out (KT's mobile revenue fell from $8.1bil in 2008 to $5.8bil in 2012), that partnerships of any kind that made sense to be explored (clearly referring to OTT and content partnerships as these are the big revenue generators now) and mobile service providers need to ensure service delivery becomes dependable.  As SK Telecom launched the world's first LTE Advanced service, with theoretical speeds of 150Mbps, hoping there would be enough competition amongst LTE A device vendors to bring in the variety and capabilities that the network can really exploit.

 

A senior executive of China Mobile, at the GTI (Global TD LTE Initiative of which Bharti Airtel, China Mobile are founder members) Asia Summit which was co-hosted at the MAE, clearly said the focus of his company was to ensure availability of a mature voice solution on TD LTE 4G network. China Mobile currently has 4G TD LTE network covering 14 cities with 22000 base stations. Plans are on to cover 100 cities with over 200k base stations by end of 2013 confirming the bidding process is currently underway. The procurement plan includes 160k terminals including data devices and smart phones.

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View of the exhibit area at Mobile Asia Expo 2013 - Shanghai

 

Asia continues to be one of the hot beds for mobile growth as the region is expected to generate a revenue base in excess of $500 billion in 2013(research from GSMA Intelligence). Of this, China, Japan, India and South Korea alone will account for over 60% of the regions mobile connections and more than 70% of the region's mobile revenue. Although data trends are positive, the rate of connection growth (new SIMs) in Asia is continuing to fall and competition is still severe. While data growth is being triggered by new smart phones, tablets and dongles, the operators’ ability to manage data growth with limited spectrum is driving innovation in Wi-Fi solutions. While Western markets use Wi-Fi to augment capacity, Asian carriers are using Wi-Fi largely to cover spectrum gaps, black holes in coverage zones.

 

A separate track at the GTI Asia was focused on driving a transition path for WiMAX operators to move into TD LTE operations as smoothly as possible. This is an important discussion too as globally there are over 120 operators with various levels of revenue generating subscriber bases that need to be taken care and not left behind. This includes BSNL in India that is continuing to deploy fixed WiMAX subscriber terminals and activating live accounts even to this day. A spectrum farming and equipment migration discussion was actively underway in this track. Huawei is probably one of the only RAN players in the combined space of WiMAX / LTE - TDD and FDD and has the unique privelage of successfully transitioning a telco carrier smoothly from WiMAX to LTE without losing a single live subscriber.


Under the theme Future Communications in the GSMA Connected City, GSMA demonstrated a vision and urged audience to 'JOYN'. Joyn, is GSMA's solution to a richer communication experience to the end-user using a variant of the Rich Communication Suite (RCS).

 

GSMA Connected City was designed as an innovative future city street providing attendees the opportunity to experience the Connected life first-hand. China Mobile, Cisco, Ford, GSMA, Huawei, KT, SAP contributed in making interactive homes, cars smarter, travel faster, shopping easier, payment simpler, urban living safer and everything environmentally greener through simple daily activities using connected communities.

 

According to GSMA Intelligence, half of global 4G LTE connections will come from Asia in five years and half of total connections in Asia will be running on mobile broadband networks. Also it is estimated that between years 2013 and 2017, 4G LTE connections will grow ten-fold to reach half a billion in this region. No wonder at all that GSMA believes it is time for a Mobile Asia Expo annual event and what better place to host than Shanghai?

 

Sridhar Pai T is founder of Tonse Telecom, (www.tonsetelecom.com) a marketing services and research firm focusing on the tech industry in Asian region.

 

Read more blog posts by Sridhar Pai T here

 

Heading to the Mobile Asia Expo – braving heavy rains (top) and after the clouds cleared (below)

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No one could have imagined the fundamental impact the Internet would have on both society and the economy—changing our lives forever. The Internet has already transformed the way we work, live, play, and learn. And, this is only the beginning.

The extraordinary growth and transformation of the Internet is unprecedented, but what does the future of technology hold, and where is the Internet heading? Business executives, technologists, and policymakers are not only asking these questions—they also are looking for a map of the future that will help them assess changes in the Internet, and possible out-comes and implications of those changes for business, national policy, and regulation.

Recent research by Cisco IBSG has identified 10 major technology trends that we believe are shaping the direction of the Internet today and, most certainly, will change its direction in the future.

 

1.    A World Gone Mobile

2.    Cloud: A New Way of Delivering Technology

3.    Everything Can Be Delivered Over-the-Top

4.    Big Data: The New Oil

5.    A Global Village: Connecting the Unconnected

6.    Powerful Devices: The World in the Palm of Your Hand

7.    Bring Your Own Device: The Consumerization of IT

8.    The Internet of Things Is Already Evolving

9.    The New Mobile

10.  Converged Networks: A New Platform Architecture

 

Mobility is core to each and every one of these trends.  Whether it is the access, the devices that we are constantly carrying or the cloud services and big data that power our applications and experience, mobility is at its heart.  Mobility is redefining network architectures, and allowing both people and things around the world to achieve a level of connectivity that is unfathomable in a non-mobile world.  So, no matter how the Next Generation of Internet evolves one thing is certain: it will have mobility at its core.

 

Cisco IBSG has developed a plausible scenario for how these 10 disruptive technology trends might come together to shape the future of the Internet. We call this the “New Digital Explosion.” Why “new”? Changes in devices, networks, applications, delivery models, user behaviors, and mobility will create a step change in demand for and reliance on the Internet. 

 

The New Digital Explosion is not just about technology; it covers all as pects of consumers, the information and communications (ICT) industry, and global/national economies. One thing is certain: the New Digital Explosion will change the ICT industry, impacting all players across the value chain: There will be greater competition, redefined value chains/business models, and new strategies, resulting in both new challenges and business opportunities. Furthermore, the role of government will need to evolve to create an environment that encourages business and technology innovation, and investment and competition to the greater benefit of their societies.

Cisco IBSG’s recent point of view, The Next Generation of the Internet: Revolutionizing the Way We Work, Live, Play, and Learn, provides details on the 10 major technology trends, maps out the future of the Internet, and discusses the implications and opportunities for Internet businesses and governments in this new hyper-connected world.

This is blog 1 of a new blog series Trends in Mobility on the Cisco SP Mobility Community. Read the next blog for this blog series Trends in Mobility #2: The Future of the Mobile Industry

Additional industry research, insights, and perspectives from Stuart Taylor can be found on his blog, The Connected Life.

Follow Stuart Taylor on Twitter: @STaylorCisco

 

More Resources

Trends in Mobility #2: The Future of the Mobile Industry By: Stuart Taylor

Trends in Mobility #3: The Mobile Paradox By: Stuart Taylor

Trends in Mobility #4: Wi-Fi Technology Delivers New Value to Service Providers By: Stuart Taylor

Trends in Mobility #5: Mobile Business Users Connect with Wi-Fi By: Stuart Taylor

POV Paper: The Next Generation of the Internet Revolutionizing the Way We Work, Live, Play, and Learn (PDF)

Above: Monica Paolini, President Senza Fili Consulting interviews Craig Conaway, Global Mobile Backhaul Sales Lead, at Small Cell World Summit in London

 

In the last few months, I have spent a lot of time researching and pondering on what had changed in the small cell backhaul market over the last year. In my first report on the topic a year ago, I mostly looked at the business case challenges and technology options for backhaul in small cell deployments. It turns out that backhaul is a crucial element in the small-cell business model – substantially more important than it is in macro cell deployments – and that multiple technologies have to coexist side-by-side within the same deployment to meet the mobile operator requirements.

 

While the importance of backhaul in the business case and the need for multiple solutions has stayed the same, the vendor landscape has significantly evolved over the last year. Initially, some vendors tried to reposition their existing products for macro cell backhaul to the small cell market, but this approach delivered solutions that do not meet the operators’ requirements. Other vendors had solutions that were not ready for large deployments, did not scale, or where too expensive and too difficult to deploy and maintain.

 

In the last year, there has been a significant shift from the vendor community in trying to address the specific requirements of mobile operators. Small-cell backhaul is much more challenging than macro cell backhaul. Equipment has to be smaller, cheaper, and easier to install and manage, but at the same time it has to provide high capacity and high reliability. Most vendors – tier-1s, niche vendors, startups – have tried to address his challenges, and have come up with an interesting array of solutions and novel approaches. As a result, the new report focuses on the evolution of vendor market in small-cell backhaul.

 

The list of confirmed trends and emerging ones that we have identified is shown in the table below and discussed in the report. Here, I wanted to add some comments and get your feedback on what these trends mean for the vendor community and for the vendor selection process for mobile operators.

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With the introduction of LTE and IP-based mobile networks, mobile operators have shown in new eagerness to have multiple vendors present side-by-side in their networks. Not only mobile operators want different vendors in different markets. They also want different vendors within the same market, for the same type of equipment. This has been for a long time the case in markets like Japan, where multiple base station vendors operated in the same footprint. Increasingly, mobile operators want to adopt this model and small-cell backhaul is an area where this approach is needed because no single vendor is likely to have a wide enough portfolio of solutions to meet the requirements of a large small-cell deployment. In this perspective, small-cell backhaul –alongside with small-cell equipment, for similar reasons – may provide a testing ground for a new approach in vendor selection.

 

The coexistence of multiple vendors for small-cell backhaul poses interesting challenges. Different solutions come with different requirements – line-of-sight versus non-line-of-sight, for instance – and different performance characteristics – e.g., capacity, latency and reliability. Not only operators have to decide which solution to install at a given small-cell site, they also have to manage a complex backhaul system within a HetNet that requires a very tight latency to coordinate transmission and manage interference.

 

How will operators decide to move forward? Will they opt for keeping complexity at a minimum, selecting only one or two vendors for backhaul even though this will somewhat limit the performance capabilities of the network? Or will they be ready to face the additional complexity that comes from the performance-optimized backhaul system with multiple vendors? As it is often the case, the answer is most likely to fall in the middle, with some operators more willing to accept the risks of complexity and others more protective of the stability of the networks.

 

But, in addition to this, what may change the operators attitudes is the confidence that different solutions and different vendors can be managed within a single platform. This is an area in which we have seen interesting activity among vendors. Cisco’s announcement of a partnership with multiple wireless small-cell backhaul vendors to strengthen the emerging small-cell ecosystem is a move in this direction. We have also seen small vendors working more closely with each other to offer mobile operators to locate of solutions for the backhaul needs. As expected, most of this activity comes from specialized medical vendors and startups, which face a tougher challenge to be selected by mobile operators than tier-1 vendors. But tier-1 vendors have also shown a deeper interest in working with the startups to widen their solution portfolio.

 

At the same time, the number of small-cell backhaul vendors – either established ones or startups – has quickly grown over last year, increasing the level of competition in the market that is still limited in size and remain so for the next couple of years.

 

Will the combination of these two factors – trend towards multivendor networks, and too many vendors – result in more aggressive consolidation among vendors, or lead to a new approach in vendor selection with mobile operators more willing to buy equipment from smaller and more nimble vendors?

 

More on small-cell backhaul:

Download the full report by Senza Fili Consulting

 

Conversation with  Ed Chang, VP Product Management, and Eric Vallone, Senior Manager, Product Management, Cisco

 

Video of conversation with Craig Conaway, Global Mobile Backhaul Sales Lead, Cisco

 

Small-cell backhaul vendor solutions: the evolving competitive landscape. Presentation (slides and audio). Singapore, May 29, 2013.

 

Small-cell backhaul market update - what has changed and what has stayed the same, FierceBroadband Wireless

Machine Type Communications (MTC)


Recently the wireless industry has had an increasing interest on M2M (Machine to Machine) communications linked to technologies like Smart Grid, Wireless Sensor Networks, and applications focused on maximizing the control of resources and tracking of goods. But exactly what benefits does M2M bring to the industry, how is the market embracing it? And more importantly, why so much hype? My first approach to the technology led me to think that it wasn’t too relevant for the industry and I quite didn’t see a true impact for the wireless user but, this opinion changed when I got better informed and went a bit deep on the concept. In this post I share my views on the technology; how it all started, why I think it became relevant and my conclusions on why the industry must be excited about it.

 

Origins and Related Concepts  


The communication between machines, objects, etc. is older than the modern concepts of wireless networks; in fact the mass adoption of computing and the evolution of networking favored the concept of the Internet of Things to spur. In its early days the concept was centered on providing objects with unique ID’s and radiofrequency capabilities to allow certain industry requirements like tracking and inventory control to be fulfilled without the need of humans, so commercialized solutions for RFID has been known ever since. Today the concept is a bit different, and its goal is to allow objects and things to produce massive amounts of information, as today, such information is produced only by humans.

 

In the wireless environment the first approach to M2M was presented by research groups from device manufacturers that came with the concept of making communication modules with all the circuitry needed to attach to cellular networks but without the regular human interface. These modules could be included in almost any device the user could think of; in consequence the device will inherit the communication capabilities of the module. So the first applications emerged in the mid 90’s for the automotive industry, points of sale, fulfilling requirements of tracking and monitoring. So we have had M2M communications for some time, but it has to be considered that by no means this early applications became a major source of revenue for MNO nor had the potential to cause an impact on the market, so what’s different now?

 

Pushing to Become Relevant


The major difference between now and then is of course the performance of wireless networks when the first M2M applications appeared, the cellular wireless networks had just started to optimize their second generation architectures for data traffic (i.e. EDGE for 2G GSM); on the other hand there were no features to develop flexible solutions. Only by 2005, Java features started to be added to the modules and the manufacturing became specialized for different environments. All these and other advances paved the way and by the end of the first decade of the 2000’s, the first MNOs made public statements supporting the development of the technology.

 

But again the technology kept a low profile, something was missing, and that something happened at the beginning of 2008 when the first true virtual environment built around the concept of a smartphone exploded. Now we have virtual stores to access applications that allow users to make their smartphones a customized tool. The path for MTC protagonist role was set.

 

Functional Architecture of MTC


The industry and academia are putting together standards and technical descriptions to optimize the wireless network for MTC. To describe the functional architecture of this technology we can split it into three domains:

 

  • Device domain: containing all possible machines, objects and other end user devices intended to communicate.
  • Communication network domain: is the backbone structure that provides access to the Device domain, provides subscription control, Security and interworking with the Application domain.
  • Application domain: Containing virtual stores, virtualized environments, and management solutions for MTC.

 

The devices can communicate in different ways; directly to each other or D2D (device to device), or using the network assistance to establish communication and finally between the application server and the device. In addition to providing assistance to the communication, the network must provide all the necessary means to allow the management of subscription to the service to a large group of devices; providing at the same time control mechanisms and user interfaces to interact with functional entities like HLR, HSS and databases fundamental for the service, all while maintaining the levels of QoS for H2H (Human to Human) communication.

 

In order to provide a compatible environment for H2H and D2D communications, the industry and academia are making an effort to define and categorize all MTC solutions using differencing traits of their communication with the network or the application server; these categorizations are called network features and so far the following have been defined: Low Mobility, Time controlled, Time tolerant, PS only, Small data transmissions, MO only, MTC monitoring, Priority alarm, Secure connection, Location specific trigger, Network provided destination for Uplink data, Infrequent transmission, Group based MTC features.

 

Deep Quick Look on the Network


Additional functional entities have also been proposed at the network to enable an optimized use of the resources without causing an impact on regular human communications. The first entity is called the MTCG (MTC Gateway): an optional functional entity capable of providing centralized access and power control for devices without proper MTC features and capabilities; it is located between the Device domain and the Network domain. SCS (Service Capability Server) is an intermediate network element between the network and the Application domain and provides APIs (tools for programmers to use Telecom network specific features in their applications). MTC-IWF (MTC Interworking Function) is located internally in the Network domain and its function is to centralize the communication of various devices per characterized features towards key network functional entities providing, Authentication, Authorization, Accounting and management of subscription.

 

Technology Challenges

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Next I’ll list the main obstacles the industry and academia are trying to address:

 

  1. Increase in co-channel and inter-channel interference: Industry proposes enhanced interference schemes already proposed in Rel-11 for LTE-A and future improvements for Rel-12.
  2. Node discovery (before communication can happen nodes need to be identified and found): Industry proposes Network aided schemes to speed discovery between nodes making it seamless for the user.
  3. Signaling congestion and network overload: Industry proposes different traffic controls on the RAN and NAS sections of the network all combined with aggrupation of devices per features, and geographic zones where one functional entity decides to grant or not access to a particular group of devices, plus sophisticated spectrum allocation schemes focused on avoiding signaling congestion.
  4. Non transparent LTE global roaming: Industry works in several countries to harmonize LTE spectrum bands.

 

Looking Ahead


In the middle of all the enthusiasm, one very powerful concept emerged as a solution to millions of people that do not have access to basic services but do have a mobile phone. The idea is to allow the distribution of remote facilities to provide fundamental services using smartphone balance account and MTC without the need of a costly centralized government or private facility. Another field is BSN (Body sensor networks): these were conceived as collections of sensors distributed throughout the body that gather vital signals information and then sending it to an application server in the Internet. MTC will finally provide a functional framework to make it possible. Lastly, and as I commented on the introduction, machines are to be given the task to produce information. If so, the amount produced can surpass by a great deal the amount produced today. Big Data is the name that IT industry uses to group the mathematical algorithms, virtual spaces and in general all the solutions that allow the collection, organization, management and interface for the vast amount of data that MTC and other technologies enable. Applications and OTT (over the top players: like big Internet companies) environments will also play a big role, I’ll share next my opinion on how these will be relevant for MTC and the wireless industry.

 

The Applications Environment and Its Influence on MTC

 

The Wireless industry realized quickly the importance of applications and Internet specialized ecosystems for MTC technology, so by the end of 2009 MNO started to call out developers interested in MTC to present its proposal on apps and solutions, awarding them with money and other stimulus. This has evolved today to a complex offering of specialized developer platforms sponsored by many stakeholders of the industry. Such platforms are capable of supporting the application from the creation till the maintenance after release. Specifically speaking of the applications it can be said that they can be categorized under two big groups: the classic client server model and the D2D (P2P) model. Within these two groups each app provides solutions for any of the following communication specific requirements:

 

  • Elastic applications (i.e. FTP, email)
  • Hard real time applications (i.e. voice)
  • Delay adaptive applications (i.e. audio and video)
  • Rate adaptive applications (i.e. adaptive streaming)

 

Today, the industry continues to promote yearly challenges inviting entrepreneurs and developers in search for innovative solutions. Several early providers now have online platforms including Cloud capabilities and management tools that allow developers to not only build the application but to manage the data produced by the machines that compose the solution, also allowing them to control aspects of the cellular subscription of the devices. In other words, these platforms are interfacing with the cellular network as it has been proposed by the current standards. Application Domain of MTC has come up with its own architecture composed of Application Enablement Platforms (AEP) which interfaces with the network to manage data produced by machines and allow integration to cellular networks. Application Development Platforms (ADP) provides the tools to the developer to build SW aspects of his solution.

 

The Circle is Complete: MTC and the MNO - OTT struggle


MTC is founded on the premise that devices interact to produce data without human assistance, but that data has to be put at the service of humans The only known way to do that is by means of user interfaces and mechanisms that allow an easy query, or in general terms, an intuitive experience and interaction. Since computing usage habits are migrating from static to mobile, the inductive thinking process leads to conclude that OTT ecosystems (Mobile Operating systems, Application stores, etc.) are the most effective channel to provide humans with such interfaces; as well the virtual environments and the control over the vast amounts of information to be produced by machines Why? Well mainly because almost everyone with a smartphone is familiar with the concept of applications. In terms of management, trends like BYOD and tools like the virtual stores could ease the distribution and version control of the interface and other aspects, allowing companies to also address security concerns in some way. So in conclusion, my opinion is that OTT ecosystems are helping MTC to become relevant.

 

MTC was born from a MNO perspective. The operators are the ones pushing for this trend to explode and the fact that OTT ecosystems are helping to make it relevant provide the irony ingredient for all the media articles produced around the subject. MTC is by no means an exclusive market many stakeholders from diverse fields are already involved and I think is a chance for MNO to prove their capacity to be innovative and flexible in an ever changing market.

 

Final Thoughts


The existence of commercial solutions for M2M is real, but it is also real that these solutions are deployed on non-optimized for the purpose cellular networks and in the likely scenario of massive MTC adoption this optimization will be needed in order to avoid interference with regular human communications. Early commercial solutions are a fundamental to identify real needs on the market, to build an initial relationship with the customer of the technology and to create commercial bonds that will nourish the ecosystem. Current solutions like portable card payment terminals, transportation metering, smart grid, security through tracking, among others will benefit from an optimized environment integrated with OTT ecosystems and other wireless technologies.

 

My personal opinions on some of the benefits of MTC are:

 

  • It will test the capabilities of the industry service providers as being truly innovators able to change and adapt to market dynamic requirements.
  • It could help to create interesting collaborations between OTT actors and MNO.
  • QoS (Quality of Service) schemes must grow mature and widely spread throughout networks to allow coexistence of M2M and H2H communications.
  • It will provide another testing scenario for different wireless technologies to be integrated under the purpose of the realization of a service. Standards propose that direct D2D communication be implemented through non licensed bands coordinated from the network in regular licensed spectrum bands; this opens the door for other wireless technologies to join in.

 

For more, follow me on Twitter, @jomaguo

 

For all blog posts written by Jorge Guzman Olaya, please visit his Community Profile

 

Read this blog post in Spanish

Machine Type Communications (MTC)  


Recientemente la industria inalámbrica ha mostrado un creciente interés en comunicaciones M2M (Machine to Machine) ligadas a tecnologías como Smart Grid, Redes de sensores inalámbricos y aplicaciones enfocadas a maximizar el control de recursos y el seguimiento de inventarios de bienes. Pero exactamente ¿qué beneficios aporta M2M a la industria? ¿Cómo se ha comportado el mercado?  E igualmente importante ¿por qué tanta emoción? Mi primer contacto con la tecnología me llevó a pensar que no sería relevante y no veía un impacto importante para el usuario, pero esta opinión cambió a medida que me fui informando mejor. En esta entrada comparto mis conclusiones sobre la tecnología; de cómo empezó, y porqué pienso que podría ganar relevancia y mis conclusiones sobre la justificada emoción de la industria.

 

Orígenes y conceptos relacionados  


La comunicación entre máquinas, objetos, etc. Es más vieja que los conceptos modernos de redes inalámbricas; de hecho la adopción masiva de la computación y la evolución de las redes ocasionó que el concepto de la Internet de las cosas emergiera. En sus inicios el concepto se centraba en proveer a objetos con identificación única y capacidades de comunicación por radiofrecuencia para que algunas aplicaciones como rastreo y control de inventario fueran posibles de realizar sin la intervención humana, de esta forma soluciones comerciales de RFID se han conocido desde entonces. En la actualidad el concepto es algo diferente, y se enfoca en permitir que las máquinas produzcan cantidades masivas de información, la cual en la actualidad es producida por humanos.

 

En el ambiente inalámbrico, la primera incursión en M2M, fue impulsada por grupos de investigación pertenecientes a fabricantes de dispositivos, quienes propusieron el concepto de módulos de comunicación con toda la circuitería necesaria para obtener servicio de las redes celulares sin contar con una interfaz para humanos, estos módulos además podían ser incluidos en casi cualquier dispositivo pensable, éste último obteniendo las capacidades de comunicación del módulo. Entonces las primeras aplicaciones aparecieron a mitad de los 90 para la industria automotriz y puntos de venta, satisfaciendo necesidades de rastreo y monitorización. Se concluye entonces que se ha contado con soluciones M2M por algún tiempo, pero debe considerarse que bajo ninguna circunstancia estas aplicaciones iniciales se convirtieron en fuentes de dinero significativas para los MNO (Mobile Network Operators) ni tampoco causaron gran impacto en el mercado, entonces, ¿qué ha cambiado últimamente?

 

Peleando para volverse relevante


La mayor diferencia entre entonces y ahora, es por supuesto el desempeño de las redes inalámbricas, cuando aparecieron las primeras aplicaciones M2M o MTC, las redes celulares apenas empezaban a optimizar sus arquitecturas de segunda generación para el tráfico de datos (i.e. EDGE para 2G GSM), por otro lado no existían herramientas para el desarrollo flexible de aplicaciones, solo hasta 2005 se empezaron a añadir funcionalidades de Java en los módulos y la fabricación de los mismos se especializó para diferentes ambientes, todo lo anterior y otros avances en términos tecnológicos permitieron que a finales de la primera década del 2000 el primer MNO hiciera públicos sus intereses para desarrollar y apoyar la tecnología.

 

Pero nuevamente MTC, mantuvo un perfil bajo, algo seguía faltando, y ese “algo” pasó a principios de 2008, cuando explotó el primer ambiente virtual construido alrededor del concepto de un teléfono inteligente; ahora contábamos con tiendas virtuales para acceder a aplicaciones que nos permitían convertir nuestro teléfono en una herramienta personalizada, el camino para el protagonismo de MTC estaba listo.

 

Arquitectura funcional de la MTC


La industria y academia están construyendo estándares y descripciones técnicas para optimizar las redes inalámbricas para MTC, para describir la arquitectura funcional de esta tecnología podemos dividirla en tres dominios:

 

  • Dominio de los dispositivos: que contiene todas las posibles máquinas, objetos y dispositivos de usuario final que están destinadas a comunicarse.
  • Dominio de la red de comunicaciones: es la columna vertebral que provee acceso al Dominio de los dispositivos, provee control de suscripción, seguridad y comunicación hacia el Dominio de aplicación.
  • Dominio de aplicación: que contiene las tiendas virtuales, ambientes virtualizados y soluciones de gestión para MTC.

 

Los dispositivos pueden comunicarse de distintas maneras; directamente entre ellos o D2D (device to device), usando la ayuda de la red para establecer comunicación, y finalmente entre el servidor de aplicación y el dispositivo. Además de ayudar en la comunicación, la red debe proveer todo lo necesario para permitir la gestión de la suscripción al servicio de grupos grandes de dispositivos, al mismo tiempo permitiendo mecanismos de control e interfaces de usuario para interactuar con entidades funcionales como HLR, HSS y bases de datos que permiten la realización del servicio, todo mientras se conservan los niveles de QoS para la comunicación H2H (Human to Human).

 

Para poder tener un ambiente compatible entre comunicaciones H2H y D2D, la industria y academia están esforzándose por definir y categorizar las soluciones de MTC usando aspectos específicos de su comunicación con la red o con el servidor de aplicación, estas clasificaciones reciben el nombre de funcionalidades de red, y hasta el momento se han definido las siguientes: Baja movilidad, Controlada por tiempo, Tolerante a retardo, Solamente PS, Transmisiones pequeñas de datos, Solamente MO, Monitorización de MTC, Alarma con prioridad, Conexión segura, Iniciada por ubicación específica, Destino suministrado por red para información de subida, Transmisión infrecuente, Funcionalidades MTC por grupo.

 

Una mirada rápida pero profunda a la red


Algunas entidades funcionales han sido propuestas para ser agregadas a la red y así permitir un uso optimizado de los recursos evitando impactos en las comunicaciones regulares para humanos. La primera entidad es conocida como MTCG (MTC Gateway) es opcional y proporciona un acceso centralizado y control de potencia a dispositivos sin funcionalidades adecuadas de MTC, está ubicada entre el Dominio de los dispositivos y el Dominio de la red. El SCS (Service Capability Server) es un elemento de red intermedio entre la red y el Dominio de aplicación, provee APIs (herramientas para que los programadores usen funcionalidades específicas de la red en sus aplicaciones). La MTC-IWF (MTC Interworking Function) está ubicada al interior del Dominio de red, su función es centralizar la comunicación de varios dispositivos por funcionalidad de red hacia entidades de red claves que suministran, autenticación, autorización, contabilidad y gestión de la suscripción.

 

Retos de la tecnología

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A continuación, listo los obstáculos principales que la industria y academia intentan solucionar:

 

1. Aumento en la interferencia co-canal e intra-canal: la industria propone usar los esquemas de mitigación de interferencia avanzados ya propuestos en Rel-11 para LTE-A y las mejoras futuras para Rel-12.

 

2. Descubrimiento de nodos (Antes de que exista comunicación los nodos deben ser encontrados): la industria propone esquemas de asistencia de red para agilizar el descubrimiento entre nodos de forma transparente para el usuario.

 

3. Congestión de señalización tráfico: la industria propone diferentes controles de tráfico tanto en la RAN como en el NAS de la red combinados con la agrupación de dispositivos por funcionalidad de red y zonas geográficas de control donde una entidad funcional decide si otorgar o no acceso a un grupo particular de dispositivos, adicionalmente un esquema sofisticado de asignación de recursos de espectro enfocado en evitar la congestión de señalización.

 

4. Roaming global para LTE no transparente: La industria trabaja para armonizar las bandas de espectro para LTE en varios países.

 

Una mirada al futuro


En medio de tanto entusiasmo, emerge un potente concepto como solución para millones de personas sin acceso a servicios básicos pero que poseen un celular, la idea es permitir a instalaciones remotas en forma distribuida que provean servicios fundamentales usando el balance de cuenta y MTC sin la necesidad de costosas instalaciones centralizadas del gobierno o privadas. Otro campo son las BSN (Body sensor networks) éstas fueron concebidas como la reunión de sensores distribuidos por el cuerpo y que obtienen información vital para luego enviarla a un servidor de aplicación en Internet, MTC proveerá finalmente un marco de referencia funcional que lo hará posible. Finalmente y como lo expuse en la introducción, las máquinas producirán la información, de ser así, la cantidad producida podría fácilmente sobrepasar la tasa actual, Big Data es el nombre usado por la industria de tecnologías de la información para agrupar los algoritmos matemáticos, los espacios virtuales y en general todas las soluciones que permitirán la obtención, organización, gestión e interfaz para la vasta cantidad de información que MTC y otras tecnologías permitirán. Las aplicaciones y los ecosistemas OTT (over the top: compañías grandes de Internet) también jugarán un papel importante, a continuación comparto mi opinión sobre cómo serán importantes para MTC y la industria inalámbrica.

 

El ambiente de las aplicaciones y su influencia en MTC


La industria inalámbrica identificó rápidamente la importancia de las aplicaciones y los ecosistemas especializados para el desarrollo de la tecnología MTC, a finales de 2009 los MNO (Mobile Network Operators) invitaron a desarrolladores de SW interesados en MTC a presentar sus aplicaciones y soluciones, premiándolos con dinero y otros estímulos, esto ha evolucionado hoy a una compleja oferta de plataformas de desarrollo especializadas patrocinadas por diversos actores de la industria, dichas plataformas son capaces de soportar el desarrollo desde la creación hasta el mantenimiento después del lanzamiento. Hablando específicamente de las aplicaciones, éstas pueden ser clasificadas en dos grandes modelos; aquellas con un modelo clásico cliente-servidor y aquellas con un modelo D2D (P2P). Dentro de estos dos grupos cada aplicación suministra soluciones para cualquiera de los siguientes requerimientos de comunicación:

 

  • Aplicaciones elásticas (i.e. FTP, correo electrónico)
  • Aplicaciones de tiempo real estricto (i.e. voz)
  • Aplicaciones con adaptación al retardo (i.e. audio y video)
  • Aplicaciones con velocidad adaptativa (i.e. difusión adaptativa)

 

En la actualidad, la industria continúa promoviendo concursos anuales para empresarios y desarrolladores en búsqueda de soluciones innovadores. Varios de los primeros proveedores de HW ahora tienen plataformas en línea incluyendo capacidades de computación en la nube y herramientas de gestión que permiten a los desarrolladores no sólo construir la aplicación sino gestionar la información producida por las máquinas que conforman la solución, de igual manera también les permite controlar aspectos de la suscripción celular de los dispositivos, en otras palabras, estas plataformas ya hacen interfaz con las redes celulares, como se propone en los estándares. El Dominio de la aplicación de MTC tiene su propia arquitectura compuesta de Application Enablement Platforms (AEP) que hacen interfaz con la red para gestionar la información producida por las máquinas y permiten la integración a las redes celulares. Application Development Platforms (ADP) que proveen herramientas al desarrollador para construir aspectos de SW de la solución.

 

El círculo se cierra: MTC y la batalla entre MNO y OTT


MTC se fundamenta en la premisa que los dispositivos interactúan entre sí para producir información sin la asistencia humana, pero la información debe estar al servicio del ser humano, la única forma de hacerlo posible es por medio de interfaces de usuario y mecanismos que permitan una consulta fácil, o en términos generales una interacción intuitiva, como los hábitos de uso de la computación están migrando de estáticos a móviles, el proceso de pensamiento inductivo nos lleva a concluir que los ecosistemas OTT (Sistemas operativos móviles, tiendas de aplicación, etc.) constituyen el canal más efectivo para suministrar a los humanos con las interfaces, los ambientes virtuales y el control sobre cantidades enormes de información, ¿Cómo? Bueno, porque casi cualquier persona con un teléfono inteligente sabe cómo funcionan las aplicaciones. En términos de gestión tendencias como BYOD y herramientas como las tiendas virtuales permitirán a las compañías una fácil distribución y control de las versiones de la interfaz así como de otros aspectos, al mismo tiempo permitiendo atender algunos aspectos de seguridad. En conclusión, mi opinión es que los ecosistemas OTT están ayudando a que MTC se vuelva relevante.

 

MTC nació desde la perspectiva de los MNO, y son éstos quienes promueven su adopción masiva, y el hecho que los ecosistemas OTT estén ayudando a cumplir con este objetivo, provén el ingrediente irónico a todos los artículos producidos por los medios en torno al tema. MTC bajo ninguna circunstancia puede considerarse como un mercado excluyente, varios actores provenientes de distintos campos ya están involucrados, y considero que es la oportunidad para que los MNO prueben su capacidad para ser innovadores y flexibles en un mercado siempre cambiante.

 

Comentarios finales


La existencia de soluciones comerciales para M2M es real, pero también es real el hecho que estas soluciones estén desplegadas en redes celulares no optimizadas para estas soluciones, y en el eventual escenario de una adopción masiva estas optimizaciones serán necesarias para evitar perjudicar las comunicaciones entre humanos. La existencia temprana de estas soluciones es fundamental para identificar necesidades reales del mercado, para construir un relacionamiento con el cliente de la tecnología y para crear vínculos comerciales que alimentarán finalmente el ecosistema. Las soluciones existentes como, terminales portátiles de pago con tarjeta, la medición en transportes, Smart Grid, seguridad por seguimiento, entre otras, se beneficiarán de un ambiente optimizado integrado con ambientes OTT y otras tecnologías inalámbricas.

 

Mi opinión personal sobre los beneficios de MTC para la industria es:

 

  • Pondrá a prueba las capacidades de los proveedores de servicio de la industria como innovadores capaces de cambiar y adaptarse a un mercado de requerimientos dinámicos.
  • Puede favorecer la creación de colaboraciones interesantes entre OTT y MNO.
  • Los esquemas de QoS (Quality of Service) se fortalecerán y madurarán en todas las redes para permitir la coexistencia de las comunicaciones M2M y H2H.
  • Proveerá otro escenario de prueba que varias tecnologías inalámbricas puedan integrarse bajo un propósito común. Los estándares proponen que la comunicación D2D directa se realice por medio de bandas de espectro no licenciadas coordinadas desde la red por medio de bandas licenciadas; este planteamiento abre la puerta para que otras tecnologías se integren.

 

Para más, sígame, @jomaguo

 

For all blog posts written by Jorge Guzman Olaya, please visit his Community Profile

 

Read this blog post in English

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By Dan Kurschner, Sr. Manager of SP Mobility Marketing, PSIM, Cisco

 

Overview


I have just returned from beautiful Amsterdam having attended the two-day LTE World Summit at the RAI Convention Center.  Cisco was a Gold Partner this year and had four different Speakers on presentations and panel sessions.  While the summit had booths and meeting rooms, the real draws were these keynotes and panel sessions.  Keynote speakers included Dr. Byun, CTO of SK Telecom, talking about VoLTE.  Mr. Scarse, CTO for ETSI covered 3GPP Release 12 updates, small cells and spectrum usage (and re-usage).  Other speakers presented views on LTE rollouts and issues in various countries.

 

There were several informational tracks for the panel sessions including:

 

Day-1:

Service Innovations, LTE Roaming and Spectrum Management, HetNets, Handling the Mobile Data Explosion and Backhaul

 

Day-2:

Monetizing LTE, Voice and Device Development, The future of LTE, Network Optimization and again Backhaul

 

Trends and Topics

 

What I heard from the discussions was that LTE was progressing fast in North America (particularly USA) and parts of Asia (particularly South Korea and Japan).  However, LTE was not being implement with great urgency in Europe and the economic realities were pointed out as the major reason behind this lag.

 

VoLTE was a big topic this year and the question of how this was being marketed in different countries. For example, several carriers plan to market VoLTE as HD Voice while a few simply see VoLTE as a way to move voice onto a new platform and being able to then decommission old technology and in some case to re-farm spectrum used by older technology to LTE.

 

International roaming was covered and the challenge of aligning and providing the spectrum and bands. Additionally the need for the device manufactures to offer mobile devices that support enough of these various bands to enable international LTE roaming.

 

One message that came across very clearly was that most (if not all) the industry understands that the solution is not a single radio access technology, but rather a hybrid of LTE, LTE-Advanced and SP WI-Fi.  Additionally, there is general agreement that coverage requires a blend of Macro and Small Cell.  SON will be required to make this all a reality.  We made certain that everyone we spoke with understood that only Cisco provided the automated SON that could deliver on a true Hybrid HetNet radio environment.  We received no argument on that point.

 

Cisco Speakers


As I noted before, Cisco brought four speakers to this event which demonstrates that 3GPP and others see Cisco as a leader in the industry and with valuable knowledge that needs to be shared. 

 

The topics and speakers included:

 

Christophe Delcourt on a panel addressing “Managing the proliferation of traffic in the network”

 

Dr. Akram Awad PhD, as the sole presenter on “Different deployment options – Multi / Single Vendor Environments”

 

Brian Meaney, Cisco Distinguished Engineer, as the sole presenter on “Software Defined Networking- Increasing Flexibility in the network”

 

Dan Kurschner, on a panel that addressed “How is Mobile Video Challenging the Network Architecture of LTE? Mitigating the Bandwidth Hogger”

 

In my panel the host opened with a statement and directed questions to each of the panelists.  I shared VNI data to frame the discussion pointing out that we anticipate Video to represent 66% of all Mobile Data, with the average user consuming 2 GB/Mo (a 10X growth factor) by 2017.  I also pointed out that of that M2M will represent 5.1% of that mobile video traffic.  Additionally I spoke about the need for Service Providers to take an architectural approach as they re-tool their networks for LTE and the need for both an intelligent hybrid network with small cells and SON and the requirement of Elasticity in that network.  In short, Mobile Service Providers need to design for the unpredictable nature of traffic demands and ensuring they have to elasticity to respond to the unexpected which is sure to come.

 

I was fortunate to be able to attend the presentations of Akram Awad and Brian Meaney.  Akram had a brilliant presentation about the radio access challenges facing Service Providers and realistic solutions to these problems.  Akram’s presentation took a large, complex issue and broke it down in a series of manageable questions and challenges that could all be addressed.

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Brian Meaney was exceptional as he took on the “Hot buzzword” of the year (SDN and NFV) and clearly separated myth from fact.  He went on to explain the value of virtualization in the network and what should logically be addressed in the initial implementations and what will need time to see what develops.

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Closing Thoughts


The LTE World Summit is not so much about big customer meetings (we have MWC and CES for that) but the presentations and panel sessions are very interesting and valuable indeed.  Having said that, we did have the opportunity to meet with some key customers and also enjoy interesting discussions with industry analysts.  Amsterdam offered a lovely setting and it was a real treat walking past the canals to and from the event location each day.

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