LTE, outdoor small cells and the cloud RAN analysis and report on the new vendor strategies

INSIGHT REPORT

MOBILE
EUROPE
ALSO INSIDE:
SFR GOES FEMTO FREE

WIFI RIDES AGAIN!

EUROPES WIRELESS MAGAZINE S issue no. 218 S October/November 2011 S www.mobileeurope.co.uk

> French operator

to offer free residential femtos, and tie up WiFi access.

P07

PRICING STRATEGIES

> Making an offer

that customers cant refuse - how operators can innovate in pricing.

P34

THE SMALL OUTDOORS: the LTE challenge

MOBILE MONEY

> Orange shows future

with national CityZi plans, but what are the rest of Europes operators doing in mobile money?

P38

Contents
October/November 2011
Operator innovation: augmented reality The price must be right

pic from page 11

Gig-E Ethernet backhaul contract puts a smile on face of Transmode CEO

REGULARS
EDITORIAL

FEATURES
PRICING INNOVATION
The mobile operator of 2011 has to think differently about their customer data, and subscriber experience, to deliver pricing strategies that deliver maximum value to the user, but also deliver increased profitability for the operator. Can they square this circle?

04 06

From mobile money, to pricing, to network architecture, operators are not as conservative as they are portrayed.

34

NEWS
TAG spins out m2m; Tele2 to disrupt Netherlands with LTE; SFR to integrate WiFi with 3G; Bouygues pays top amount for LTE spectrum; Broadcom aims for wireless infra share; Ericsson dominant LTE provider till 2014; Operators integrate MMS with Twitter; Telefonica working on AR; Virgin Media signs 100m Gig-E deal; Huawei biggest gainer in microwave market; Monitise at mobile money "tipping point"; Operator-backed Paypal rival; Telefonica doubles Redknee investment; Traffic management takes central stage.

MOBILE MONEY
Operator-led mobile money and payments services are still thin on the ground, but momentum is growing across Europe, as operators move to commercialisation of NFC technology. So where can we look to for operator-led market momentum?

38

DIARY
A selection of the major mobile events and conferences in the weeks ahead and a glance at some of the stories to have missed the real news pages.

42

INSIGHT REPORT
FULL CONTENTS, FOREWORD
Keith Dyer introduces this issues Insight Report and charts the impact the LTE is having on how mobile network architectures may evolve.

19

VENDOR DEVELOPMENTS
Vendors are taking differing approaches to solving a common operator challenge: from integrated base stations to cloud-based processing. Femtocell and WiFi, and market entries from some new players also promise to shake things up.

26

Mobile money momentum

go to www.mobileeurope.co.uk for the latest information on mobile

Mobile Europe | 3

Comment
editor: keith dyer
Operators can innovate, but its about delivery Operators are often castigated for being poor incubators of innovation. Organisations run on spreadsheets, with high volume and low margin services, are poorly positioned to drive innovative services into the market. So it is interesting to view this issue in the light of operator attempts at innovation. A look at both the news and feature pages reveals several aspects where operators are taking INSIGHT steps to innovate. REPORT
cells LTE, outdoor small and the cloud RAN on the analysis and report new vendor strategies

MOBILE
EUROPE
EUROPE
rope.co .uk

MOBILE
S AGAIN! WIFI RIDE
S Octobe r/Novem S issue no. 218 obileeu ber 2011 S www.m

Edit or: Keith Dyer keithd@mobileeurope.co.uk Direct tel: +44 (0) 20 7933 8999 Production Manager: Tania King Sales Manager: Shahid Ramzan shahid.ramzan@mobileeurope.co.uk Direct tel: +44 (0) 20 7933 8980 Commercial Director: Justyn Gidley justyn.gidley@stjohnpatrick.com Direct tel: +44 (0) 20 7933 8979 Publishing director: Chris Cooke
P38

At a network level SFR is moving to a free model for femtocells, a first within Europe, with the aim of providing customers with the best user experience possible in home and small office. Tele2 is considering the transition from MVNO to full operator with LTE and an aggressive marketing approach in the Netherlands. Operators are behind the thrust of our Insight Report, which looks into the drivers and developments in heterogenous networks and Cloud RAN solutions for LTE networks. It is MBNL, which wraps up T-Mobile and Everything Everywhere, as well as Three UK, which has signed an innovative backhaul contract with Virgin Media Business. All of these are developments aimed at innovating at the network level to provide customers an enhanced user experience.

INE ESS MAGAZ EUROP ES WIREL

ALSO INSIDE:
SFR GOES FEMTO FREE

> French operator

l to offer free residentia WiFi femtos, and tie up access.

P07

PRICING STRATEGIES

> Making an offer s cant

that customer refuse - how operators can innovate in pricing.

P34

MOBILE MONEY

THE SMALL OUTDOORS: e the LTE challeng

> Orange shows future CityZi plans,

with national of but what are the rest doing Europes operators in mobile money?

ISSN: 1350 7362

Then, at the service level we see Telefonica, in the news pages, working with Layar, one of the companies driving forward Augmented Reality services and applications. Yet this is far from a case of an operator leaning on a partner for service innovation. In fact, Telefonica has its own well-established project. We also carry news of operator integration of messaging APIs with Twitter, to enable users to upload pictures to their Twitter profiles using MMS. Not too exciting, perhaps, but an example of the If there is a lesson there for reality of 3rd party integration that operators are told they must enable. Our features, too, deliver news of momentum building in the way operators communicate with and view users, and the way they are developing services that could change the way we pay for digital and real world items. Our feature on pricing innovation suggests that operators are dedicated to developing a different view of their customers, so that they can innovate around pricing offers, but also in the way that users can control their own experience. And our article on mobile money projects continues to suggest that if there is a critical party driving forward widespread awareness of mobile NFC payments, then that party is the mobile operator. It is the carriers that are bulk ordering the NFC-enabled handsets, the NFC-compatible SIMs. Finally, even our sponsored feature, written in association with Ericsson, suggests that operators are driving forward with dedicated go-to-market focused strategies for the enablement of services based on the Rich Communications Suite. So, as we enter into iPhone5 territory, and all the hype that that will bring, remember that Apples record is of taking tried and tested industry ideas video calling, instant messaging and making the experience easy to understand and use. If there is a lesson there for mobile operators it is that delivery is what counts, rather than innovation. But the signs are that lesson has been learnt, and real progress is being made.

Free Subscriptions Mobile Europe is a controlled circulation monthly magazine available free to selected personnel at the publishers discretion. If you wish to apply for regular free copies then please write to: Database Services St John Patrick Publishing Ltd PO Box 6009, Thatcham, Berkshire, RG19 4TT. Tel: +44 (0) 1635 879361 Email: mobileeurope@circdata.com or register free online at: www.mobileeurope.co.uk Paid Subscriptions Readers who fall outside the strict terms of control may purchase an annual subscription . UK 1 Year - 96. International 1 Year - 120. Subscription enquiries should be sent to: Saint John Patrick Publishers PO Box 6009, Thatcham, Berkshire RG19 4TT United Kingdom Tel: +44 (0)1635 879361 Fax: +44 (0) 1635 868594 Email: mobileeurope@circdata.com Web: wwwmobileeurope.co.uk

mobile operators, it is that delivery is what counts, rather than innovation. But the signs are that lesson has been learnt.

Printed by Pensord Magazines & Periodicals, Pontllanfraith, UK.

The views expressed in Mobile Europe are not necessarily those of the editor or the publisher. Mobile Europe is published by Saint John Patrick Publishers Ltd, 6 Laurence Pountney Hill, London EC4R 0BL.

4 | Mobile Europe

News
m2m in Austria l LTE in Netherlands

TAG SPINS OUT M2M

Telekom Austria Group (TAG) has formed a dedicated company to address the M2M market. The new subsidiary will act as the operators competence and service centre for all M2M activities, working at Group level. Telekom Austria has confirmed to Mobile Europe that the unit will start with about 500,000 SIMs under management, as a result of the operator's existing M2M activities. The business, known as Telekom Austria Group M2M, will focus on eight application areas: automotive, consumer electronics, health care, logistics and transportation, retail and payments, security and surveillance, industrial and smart business as well as energy and utilities. The unit will be run by Bernd Liebscher. The Telekom Austria Group has been a longstanding and reliable partner for communications solutions in the business customer segment. We are now bundling our extensive know-how in terms of data communications and billing systems for a new emerging field of business, Liebscher said. Telekom Austria said that the M2M business will aim to provide its customers with "industry know-how along the entire value chain" from product design to the implementation and operation of M2M solutions. Telekom Austria said its would have a focus on international corporate customers across its central and southern European markets. The business unit is also responsible for steering and coordinating individual initiatives in the local companies.

Tele2 to disrupt Netherlands market with LTE play

MVNO Tele2 has strongly indicated that it will bid for 800MHz spectrum in the Netherlands, and that it may become a full mobile network owner, seeking to disrupt the businesses of the three incumbent operators by combining its fixed and mobile assets to best effect. Tele2s Market Area Director for Western Europe, Gnther Vogelpoel, said that favourable legislative and regulatory decisions have presented the operator with a unique opportunity to make the move from MVNO to MNO. The Netherlands has mandated that 2x10MHz spectrum at 800MHz be reserved for new entrants, just as it did for the 2.6GHz spectrum band. Parliament has gone further and said that it also wants to see 2x5MHz for new entrants at 900Mhz. It can ask for this because in the Netherlands, not only is 800MHz being auctioned, but 900, 1800 and some 2100MHz spectrum is also being re-auctioned. Vogelpoel said that with a reserve price for a 2x5MHz block of 35 million and a rollout obligation of 40% within 5 years, Tele2 needs to evaluate closely the benefits of bidding. But with a 17 year license, he said that either we do it now or that window of opportunity is gone. We have a very weak competitive situation in The Netherlands with prices at the highest levels, and mobile broadband penetration at the lowest levels, in the area. We have our fibre network that is perfect for backhauling already we have the capacity. All these elements look good, and over the next months we are working hard to evaluate this, but we are pretty serious, Vogelpoel said. As well as the favourable auction terms for a new entrant, Vogelpoel said that The Netherlands net neutrality laws were good news for disruptive players enabling Tele2 to push new business models into the market. For more, see: mobileeurope.co.uk/news/news-analysis/8931

especially within the vertical industries and the respective account managers, which all in all amount to about 150 people out of those 200. TAG M2M is currently recruiting people to be employed directly at this competence center, and targets a mid two digit number by middle of next year. Are there any partners, developers, etc that Telekom Austria already knows it will be working with? For M2M we leverage the existing network of solution partners, but also aim to further extend our partner network beyond the borders of our traditional footprint and establish a network of best-in-class partners. We are working with our existing partners in all our operating companies and will announce further partnerships as soon as we are agreed on the terms of reference. A clear differentiator is, that TAG M2M actively manages and services its partnerships by expert employees dedicated exclusively to the maintenance and development of the relations. For the time being Telekom Austria Group M2M GmbH approaches about half a million SIM-Cards and records a 50% growth in SIM volume for year to date. Has Telekom-Austria looked at joining the Deutsche Telekom/ FT Orange/ Telia-Sonera M2M interoperability alliance? The Telekom Austria Group M2M GmbH closely looks at the current ecosystem and evaluates and decides each opportunity on a case-to-case basis. For the time being there has been no decision taken regarding the M2M interop alliance, but any future alliances and partnerships will be announced to the public as soon as they are agreed.

Q&A WITH TELEKOM AUSTRIA ON ITS NEW M2M BUSINESS UNIT:

How big will the unit be? For TAG (Telekom Austria Group), leveraging the existing resources throughout all OpCos is key, especially when it comes to technical experts and sales. Considering the entire OpCo ecosystem within TAG, the total number of experts working on M2M is currently around 200 people. Strong alignment is taking place constantly,

6 | Mobile Europe

News
Free French femto l Pricey French spectrum l Swedish LTE

SFR TO INTEGRATE WIFI WITH 3G SERVICEFREE FEMTOCELLS PLUS OFFERS

French operator SFR is close to commercial launch of software that will automatically connect users to WiFi hotspots or to the 3G network, depending on availability. The WiFi Auto Connect driver is in a pilot phase in three Departments, prior to a planned nation-wide rollout later this year. SFR has access to nearly 4 million hotspots in France, through its residential neufbox product, and public access points. Its Auto Connect service is intended to enable users to automatically connect to SFR's WiFi network and to switch between 3G or WiFi networks. SCR said this would offer a "unique mobile broadband user experience, completely fluid between its WiFi Hotspots and 3G". In addition to its WiFi strategy, SFR has started marketing a "free" femtocell product to all its subscribers. Users pay 49 for the femtocell, which can be redeemed when the unit is activated. The unit, called "SFR Femto" is being marketed as a mobiel coverage solution. It can be plugged in as an "add on" to "most" existing DSL routers, and as a USB "click-on" to SFR's own Neufbox Evolution product. As well as these femto and WiFi investments, the operator also continues to expand its macro network. It said it would have its first three cities covered with 42Mbps HSPA before the end of 2011. At the moment, it has the 12 largest French cities covered with 21Mbps HSPA. The operator also said it is "densifying" 3G coverage in key areas, such as tourist resorts and along TGV routes. The company, which has just won 2.6GHz spectrum for the provision of LTE services, also this week held an LTE demo in Marseilles in collaboration with Nokia Siemens Networks. The company said it invests 1.5 billion annually in its overall network infrastructure, which includes a degree of fibre backhaul connectivity.

Bouygues pays top amount for French 2.6Ghz LTE spectrum

The first part of the auction in France of spectrum designated for LTE servces has seen all four bidders win spectrum and the French government exceed its reserve price by 33%. The auction for spectrum in the 2.6GHz band saw: Bouygues Telecom allocated 15 MHz, for which the company bid the sum of 228,011,012 and made a commitment to host MVNOs on its network. New entrant Free Mobile allocated 20 MHz, for which the company bid the sum of 271,000,000 and made a commitment to host MVNOs on its network. Orange France allocated 20 MHz, for which the company bid the sum of 287,118,501 and made a commitment to host MVNOs on its network SFR allocated 15 MHz, for which the company bid the sum of 150,000,000, and did not make a commitment to host MVNOs on its network. The auction therefore raised a total of 936 million compared to the reserve price of 700 million. On a straight price per MHz calculation, Bouygues has paid the most, by bidding 228 million Euro for its 15MHz duplex block. However, it is worth nothing that the operators will have made a calculation of the value of spectrum in alliance with what they intend to bid for in the 800MHz. Broadly speaking, the 800MHz band will provide wider coverage and will come with service obligations. The 2.6Ghz band will be better suited to smaller-sized cells in urban or suburban territories, although its in-building penetration performance will be worse. By bidding the highest, Bouygues will also gain first consideration from the regulator in the position of its frequency within the 2.6GHz band. In the coming weeks, ARCEP will issue the winning candidates with licences to use their respective frequencies, once it has determined each operators position on the 2.6 GHz band. For this determination, ARCEP will examine the wishes that each candidate has expressed in regard to position, in the following order which corresponds to the average mark per 5 MHz duplex: Bouygues Telecom, Orange France, Free Mobile and, lastly, SFR. The deadline for the second auction stage is 15th December 2011.

TELIA TO HAVE 231 LTE LOCATIONS by end of 2011

Telia has said that its LTE network in Sweden now covers 153 "locations", and that by the end of 2011 the operator wants to have 231 sites with LTE coverage. The expansion will see TeliaSonera move beyond urban areas into smaller towns and tourist sites. Our 153 locations is a good start, but only a start. With the surge in mobile data usage, we will continue to extend and enhance the capacity of our mobile networks to provide our customers with the best online experiences possible, Ulrika Step, head of Mobility Services at TeliaSonera, said. Telia said that its LTE network, opened in late 2009, offers practical speeds of up to 80Mbps. It has also carried out an upgrade to its 3G network to enable top theoretical speeds of 32Mbps. Telia also has more than 4,000 WiFi hotspots in Sweden. See www.telia.se/4g for a complete list of all localities with 4G and planned locations for the remainder of the year. In addition to urban areas continues Telia to expand in smaller towns and more tourist sites.

go to www.mobileeurope.co.uk for the latest mobile news

Mobile Europe | 7

Sponsored Feature

SUPPORTING THE MOVE TO RICHER SERVICES

As major operators move towards deploying services based on the RCS-e specification, Mobile Europe looks at how Ericsson is supporting operators to achieve maximum benefits, and at how one Ericsson customer, Telefnica Group, views the implementation of RCS.
There was some understandable skepticism when, earlier this year, five major European operators announced that through the latter part of 2011, and into 2012, they would launch commercial services based on the Rich Communication Suite (RCS) specifications. RCS delivers evolved and an interoperable communications service, that utilizes existing telecom standards, such as chat and group chat, file transfer and live video share, in one direction. This skepticism was perhaps merited, as the vision of interoperable, enriched communications services has been proposed by some within the operator community for years. There were initial trials of RCS services in France, Italy, Japan and Korea from 2008 through 2010, and they achieved good results in terms of user satisfaction, and operator interoperability. Yet, despite these efforts, real commercial progress never materialised, as operators struggled with the business case, but also with grasping the full technical implications of scaling the RCS specifications. This years announcement was different, though, coming as it did on the back of work to redefine RCS specifications, to allow operators to launch services based on a tighter, enhanced and go-to-market focused, version of RCS, now called RCS-e. That progress lead to Telefonica, T-Mobile, Vodafone, Telecom Italia Mobile and FT-Orange all publicly committing to launching services based on the RCS-e specification.

A multi-platform messaging experience is one of the potential benefits of RCS-e.

the behalf of operators to move to commercial deployments. There is a tangible move to become much more market focused, as evidenced by several ongoing operator development programmes, in Europe, the Americas and Asia Pacific.

Towards an ecosystem for RCS

This change of focus has also fostered an outward looking approach, as operators aim to create an ecosystem of compatible clients and applications. This has lead to the formation of the Rich Communications Ecosystem (RCE) project with the GSMA, the industry body that has driven the development of RCS to date. RCE is focused on facilitating device and infrastructure availability for RCS-e, by driving go-to-market activities such as interoperability testing (IoT) and support for operators. The GSMA says that the RCE project has gained broad support from leading mobile operators, OEMs and client application developers to develop new service packages for today's 'always-on' mobile users. To give an example of this ecosystem-led approach, the GSMA has launched to the wider market a Request For Proposals for the selection of RCS-e applications for those smartphone platforms that do not support native implementation of RCS-e. This could lead to users of Android and iOS devices being able to access RCS-e services, even though RCS-e is not supported by a native client on the device. It has also called on vendors and developers to provide their support within the standards bodies,

More market focussed

The adoption of RCS-e is likely to see a range of services being introduced, all flowing from a connected address book. Key among them will be chat and group chat functionality, as well as file transfer and the ability to utilise voice from non-telephony devices, such as tablets and PCs. The principal structural change with RCS-e has been in the way presence is handled within the network. The RCS-e specification has taken away the requirement for a network-based presence server, instead handling service capability detection and information distribution within the SIP client on the device. This places a much lighter network integration task upon operators, as well as reducing signaling and network load.Yet aside from these technical alterations, the adoption of RCS-e signaled a deeper commitment on

8 | Mobile Europe

Sponsored Feature
Developing an ecosystem could enable delivery of RCS services to devices without native RCS support.

operators as they plan and specify services, ensuring compatibility with the standards, and technical assurance. Crucially, the company is also leveraging its close relationships with operators to verify and test service interoperability of clients, services and equipment. Operators are on a tight timeline to get to market; therefore they need to work with a partner that they trust, a partner that will enable them to deliver to the market this collection of business-critical services and applications.

RCS THE OPERATOR VIEW

principally the OMA and 3GPP, by participating in IoT tests, and by providing commitments to release IoTtested equipment within tangible timeframes. Ericsson is fully committed to enabling this process, and has formed close co-operation with leading operators that are developing and launching RCS-e services. This is a most important aspect of RCE, as it moves RCS away from being viewed as a set of service definitions, into an enabler of in-service offerings on the market.Importantly, this enables operators to both interoperate but also differentiate on services, by exposing APIs to developers and partners, to add new elements to the core communication services in RCS-e. One of the barriers to RCS adoption to this point has been the worry that operators, driven by the need to ensure interoperability between services and networks, would all be delivering the same set of services within a market. An ecosystem approach, which treats RCS-e as an enabler of services, rather than a set of services itself, has the potential to be a much stronger strategic tool for operators. It also has the potential to give operators a tool to compete with other providers of enhanced messaging services the competitive threat from what are termed Over The Top services such as Facebook messaging, iMessage from Apple, Blackberry Messenger and Whatsapp. The emergence of these players has been one of the driving factors behind operator commitments to delivering RCS-e, and has also served to prove the consumer appetite for such services. Yet operators are in a position to go beyond what an individual OS platform, device manufacturer or online community can offer. Operators have the means to integrate cross-platform interoperability, bringing together communities that have remained discreet to this date. By ensuring interoperability, operators can also open up these platforms to other application developers, taking advantage of a standards-based approach to reach much wider markets than have previously been available to them. To take these steps, operators need to work with companies that can understand their requirements, and ensure that they are working within the guideline specifications and standards. Ericsson works with Mobile Europe asks Javier Arenzana Arias, Director Rich Communication Services, Telefnica Group, what advantages an RCS strategy may deliver for customers, operators and application partners. Is RCS a consumer service or is it an enabler for other services or is it both? Instant Messaging, blogs, posts and updates to social networks, tweets In the last few years all these new advanced communication services have become key to the lives of our customers. They account for a continuously growing share of the total communications that our customers generate, share and receive. Usage from PCs is massive right now, and our clients are increasingly demanding to have the same services available on their mobile devices. To remain reference providers of communication services, telcos must therefore extend their service offering into this advanced communications space. RCS gives us the opportunity to do that, by leveraging the differential benefits to customers of our core service model: universality, native/optimised usability in any device, and direct availability. These are very valuable attributes for a mass-market service that the OTT offerings from ISPs wont provide. Will RCS be an operator exclusive community or will it be open for interoperability with OTT players? The way we would position RCS is that it is complementary to the services of the ISPs, bringing additional value to the communications space. RCS is designed to be open for interoperability with all agents that want to participate in the communications ecosystem, either via service interconnection (open standard) or via the open APIs that are being defined. Developers and ISPs interoperating with RCS will reinforce the value of the universality that operators can provide. What is the likely impact of introducing RCS services upon SMS and other messaging? Instant Messaging (IM) services in RCS will act as an enhancement to todays simple sms/mms messaging, bringing richer functionality and a more compelling user experience. This should certainly increase the use of messaging. How will support for RCS support be introduced in the market on devices: do you envision it being pre-installed on new devices and/or offered as downloadable for Smartphones, Tablets, PCs and as Web clients? The ambition is to get RCS natively integrated in all devices as soon as possible. Integration by the manufacturer into the UI of handset will ensure optimum usability and service performance on each device. Nevertheless, downloadable RCS applications will also be important to facilitate the rapid propagation of the service into those devices that do not natively support RCS, such as exist in the current installed base. Application developers and telcos themselves will also be able to offer downloadable apps that introduce new innovative features to the core RCS services, and in that way the value to all players in the ecosystem of an interoperable, open-standards approach can be maximised.

Mobile Europe | 9

News
Base station tech l Ericsson dominant l Twitter MMS

BROADCOM AIMING FOR INCREASED WIRELESS INFRASTRUCTURE SHARE

Broadcom's acquisition of NetLogic will enable it to more than double its addressable market, most significantly into the wireless infrastructure and base station markets, Scott McGregor, Broadcoms President and CEO, said on an analyst call. McGregor said that the combination of Broadcom's switching and routing platforms with NetLogic's knowledge based and digital front end would allow the company to address the The company hopes that combining NetLogic's digital front end processors with other assets it has in the backhaul space would allow it to play a broader role in the wireless infrastructure market. McGregor added that as DSP gets a bigger role in base stations, as they evolve to LTE and beyond, the Broadcom-NetLogic combination would give it a significant expansion of the addressable market in wireless infrastructure. BroadCom and NetLogic are currently used in many of the same platforms, and this proposed acquisition is an important next step to something truly unique in embedded processing creating highly differentiated digital front end solutions for wireless base stations, and best-inclass integrated platforms for this segement, McGregor said. Ron Jankov, NetLogic Microsystems President and CEO, added that combining the leading multicore, knowledge based and digital front end processors with Broadcom's tools, IP and ecosystem would create, a complete comms platform solution for customers' next generation designs. It will allow us to re-think the positioning of functionality on the platform, the design and footprint. Broadcom's proposed $3.7 billion acquisition of NetLogic is due to close in the first half of 2012, the company said.

Ericsson LTE equipment in Sweden

Ericsson to be "dominant" LTE base station provider till 2014

In-Stat has forecast the biggest winners in the LTE infrastructure market. The research company is forecasting that the total number of LTE macro base station deployments will reach 1.5 million in 2015, with Ericsson claiming a "dominant" first position while Huawei and Alcatel-Lucent battle it out for the second spot. Ericsson and Alcatel-Lucent have become the early LTE leaders as a result of modernisation contracts with Verizon and AT&T. Nokia-Siemens Networks recently claimed a prestigious contract win with Telecom Italia, said Chris Kissel, Analyst. Huawei has won both A1 Telekom and TMobile in Austria. Samsung has been instrumental in the MetroPCS LTE launch and will be a major factor in South Korea as their LTE market comes online.

THIS IS AN IMPORTANT NEXT STEP TO SOMETHING UNIQUE

concerns of network operators as they deal with rapid growth in demands on their networks. Network operators are struggling with the number of connected devices on the network and the exploding demand for bandwidth. The need to handle a wider variety of apps is forcing corporations and operators to use more and faster switches and increase intelligence by integrating more embedded processors. In the long term our goal is to combine the multicore front end NetLogic processors with BroadCom's platforms, to integrate higher bandwidth functionality and intelligence into one solution, with a lower integration cost, enhanced system performance and lower execution risk.

FOUR EUROPEAN OPERATORS integrate MMS with Twitter using messaging APIs
Subscribers of four European operators now have the capability to post photos to their Twitter accounts using MMS, following application level integration with Twitter. Three UK operators, Vodafone, Orange and O2 will offer consumers the service, as will Vodafone Italy. O2 said that users would be charged the usual MMS rate for sending an MMS to their Twitter account. UK users will be able to send photos to Twitter by sending a message to short code 86444. O2 is enabling the service integration through its BlueVia API. A Vodafone spokesperson said that the Twitter integration was not carried out through any particular partner or developer programme, "We just enabled it," he said. O2 seem a bit more excited about the use of its API. Jose Valles, Head of BlueVia, said in a statement, Were very excited about this new service. Our customers in the UK will satisfy a need of tweeting in certain specific circumstances and that, we expect, will help Twitter grow its presence in the UK. On the other side, we in BlueVia are slooking forward to spread this service to the whole footprint of Telefnica. The use cases for using MMS to update Twitter seem limited, however. At the moment, users can either upload photos within dedicated Twitter clients, or from Twitter's own mobile platform. There may be scope for those users with feature phones to use MMS to update a Twitter account. Perhaps of greater importance is that the integration with messaging APIs shows that these operators are relaxed about opening access to a third party messaging platform, and in doing so turn MMS from a peer-topeer to a peer-to-app service.

10 | Mobile Europe

News
l Telco innovation l

TELEFONICA WORKING WITH LAYAR ON IRIS AR PROJECT

Layar, a provider of mobile augmented reality (AR) technology, has entered into a strategic partnership with Telefonica I+D to provide it with its Visual Search Technology: IRIS. Visual Search enables Layar to search through millions of images to identify these images and correctly augment them on the mobile phone resulting in a more intuitive user experience. Visual Search is a key component in the delivery of vision based Augmented Reality services to end-users. It makes it possible for real world objects to work as identifiers and/or hyperlinks for augmented reality experiences. Layar is adding IRIS Visual Search capability to their Layar Reality Browser, making it significantly easier for users to discover relevant Augmented Reality content. The goal of Telefonica's IRIS project is to develop a service that provides information related to an object just by taking a picture of it. The object needs no special packaging, tag or marker. For this objective, Telefnica I+D has developed and patented proprietary visual recognition technology. This technology enables the identification of objects such as supermarket products, logos, posters, or paintings among others. The collaboration of

EMPOWERING LAYAR WAS A NATURAL STEP

this project with Layar is framed within the Open Innovation initiative of Telefnica I+D. David Marimon, Initiative Leader at Telefonica I+D, said, When we started our collaboration, we immediately saw the synergy
Layar UI

that we were building. Our visual recognition engine is a ground breaking technology delivered to users. Empowering Layar with this technology was a natural step.

go to www.mobileeurope.co.uk for the latest mobile news

Mobile Europe | 11

Backhaul News
UK Gig-E backhaul l Huawei gains

VIRGIN MEDIA BUSINESS SIGNS 100M GIG-E BACKHAUL DEAL WITH MBNL
PACKET OPTICAL WIN FOR TRANSMODE
Mobile Broadband Network Ltd (MBNL), the company that operates the 3G network used by Everthing Everywhere and Three UK, has signed an eight year, 100 million deal to upgrade their backhaul network. MBNL has signed a deal with Virgin Media Business (VMB) which will see it become the first customer for VMBs Sync-E solution. The contract will see VMB build 14 regional aggregation networks across the UK to enhance MBNLs bandwidth capacity. A statement said the deployment would be the UKs only synchronous Ethernet mobile backhaul service. The first phase of deployment will see MBNL have access to a 1 Gigabit per second (Gbps) Ethernet service to meet growing mobile data demand. EE and Three have 35.2 million customers between them, and are faced with same the priorities that all mobile operators are in dealing with the growth in mobile data on the dowlink and uplink. Graham Payne, Managing Director, MBNL, said, Mobile data and the increase in smartphone usage is a big growth opportunity for us. Connecting our end users to the online world, from any location and from any device is at the heart of what we do. Working together with Virgin Media Business, the first company in the market to offer this synchronous Gigabit Ethernet service, we will be able to scale for future demand. VMBs service is built on technology from Transmode. Transmode said that it estimates that the new contract is worth up to SEK150 million in 2011 and 2012 and that deliveries will begin in the third quarter 2011. The dedicated networks will rely on Transmodes Native Packet Optical architecture, including the recently-launched Layer 2 Ethernet Muxponder family. Ethernet services will be provided from the mobile operators core node locations right through to the operators cell sites. Transmode said the service would enable VMB to provide highly flexible services with better synchronisation
Transmodes CEO, Karl Thedeen.

performance than alternative solutions in the market. Analysts estimate that by 2015 globally there will be a ten-fold increase to more than two million fibre-connected base stations. We believe that this is one of the biggest packetoptical based mobile backhaul projects in Europe and it will provide Virgin Media Business with a state-of-the-art platform for their Sync-E enabled, Gigabit Ethernet mobile backhaul services, said Karl Thedeen, Chief Executive Officer at Transmode.

INFONETICS FINDS HUAWEI BIGGEST GAINER in microwave market

Revenue gains in Ethernet and hybrid TDM/Ethernet microwave equipment sales failed to offset price erosion across most microwave market segments, leading to a 2.4% rise in the overall microwave equipment market in 2Q 2011, according to research firm Infonetics. The total market reached $1.3 billion worldwide for the quarter, Infonetics Research said, with Ericsson and NEC the leaders by market share, and Huawei pushing into third place with a growth of 90% by revenue. All three are now separated by just one point market share, Infonetics said. The analyst attributed Huawei's succes to the considerable amount of higher-spectrum microwave gear they sell, particularly 23- and 38-GHz equipment, and to leveraging their contracts with their mobile RAN and optical equipment customers. Infonetics Research's Microwave Equipment vendor market share and forecast report also found that: The need for enhanced mobile backhaul bandwidth will continue to drive the Ethernet microwave equipment market In preparation for the expected need for denser on-the-street cell topologies in 4G networks, small cell backhaul solutions are already coming to the microwave equipment market, sporting all-outdoor 'zero footprint' lower power form factors Microwave equipment vendors are emphasizing new higher-capacity products, with several vendors now claiming 1G+ capacity links Between 2011 and 2012, global shipments of Ethernet microwave radio equipment are forecast to double, while TDM microwave gear will continue its inexorable decline, and the decline of hybrid TDM/Ethernet microwave gear will accelerate Revenue from Ethernet microwave equipment surpassed that of TDM microwave in 2010, and is expected to overtake hybrid TDM/Ethernet microwave equipment by 2014 Infonetics also carried out a survey of 21 operators asking them about their deployment plans for its report, Microwave Strategies and Vendor Leadership: Global Service Provider Survey. For operators, customer support is the key way to differentiate from the pack. Technology is important, and vendors love to talk about new product features. But this does not always align with the way in which their customers assess vendors. To operators, a vendor that can build a lasting relationship with them, based on strong service and support, will most likely win the purchase decision, said Richard Webb, directing analyst for microwave at Infonetics Research.

12 | Mobile Europe

Payments News
Tipping point l Buyster launches MONITISE BENEFITS from mobile money "tipping point"
Mobile banking and payments company Monitise has hailed its latest financial results as evidence of a breakthrough year for the company. CEO Alistair Lukies said that the mobile money space has reached its own tipping point as the global demand for mobile banking, payments and commerce takes off. This momentum has driven revenues at Monitise up 133% from 6 million in 2010 to $14 million in 2011, for the year ended 30 June. The company reported that platform development and integration revenues were up fourfold on 2010 reaching 6 million. User generated revenues accounted for 6.3m, more than more than double the previous year. The company says it now processes more than 10 million mobile banking transactions a month, with a value exceeding 160 million. Monitise reported a loss for the year of 14.5 million (2010: 16.8 million), a loss per share of 2.1p (2010: 3.7p). It expects to break even in the calendar year 2013. Monitise has a strategic agreement with Visa Europe to develop and supply mobile payments services for Visa Europe's 4,600 member banks and financial institutions across 36 countries. It also has a five-year agreement with RBS Group, announced August 2011, to broaden mobile banking and payments services.
I Google, Citi, MasterCard, First Data and Sprint have announced and demonstrated Google Wallet. Available in the USA for now, the service uses NFCenabled phones and payment terminals to enable users to pay for items using credit cards encapsulated on their phones. With the service still in trial phase, Google has invited additional issuing banks, payment networks, mobile carriers, handset manufacturers, point of sale systems companies and merchants to join the initiative. I Accumulate and PayPal will work jointly on mobile services projects for the Swedish local market, based on Accumulates award winning security platform Mobile Everywhere. The agreement is great news and we look forward to partnering with PayPal and to support the innovative mobile services based on our technology, says Stefan Hultberg, CEO of Accumulate.

OPERATOR-BACKED PAYPAL RIVAL LAUNCHES IN FRANCE

Buyster, a payment institution regarded as a rival to Paypal and co-owned by Orange, SFR, Bouygues Telecom and Atos Origin, will begin commercial operations in France on 13 September.

"MCOMMERCE FINALLY BECOMES ACCESSIBLE" CLAIMS BUYSTER

Buyster is an online and remote payment solution that will allow users to buy without disclosing their bank details over the phone or internet. The ambition for Buyster is for it to become a key payment player in eCommerce and the leader in mCommerce in France. A statement from Buyster made the claim that mCommerce finally becomes accessible thanks to a unique operating mechanism on the market. Users that register for the service will have their bank account associated with their mobile phone number and will be provided with a security code. When they buy an item they

enter the code, authenticating them for payment. The operators said that they will market the solution to their combined user base of 50 million subscribers as well as e-tailers. Buyster said that its systems would provide retailers with an improved conversion rate thanks to its ease of use in particular for mobile phone purchases. The mobile phone also offers stronger authentication and reduces the risk of chargeback. Buyster said in a statement that it is already supported by ten partners forming an ecosystem that can reach almost 30,000 eretailers. The partners are: Payment service platforms: Mercanet, Paybox, Payline and Sips e-Commerce platforms: Store Factory and Wizishop Publishers and agencies: Baobaz, eDecision, Kapsicum, Prestashop and Think And Go. E-retailers who will be connected from 13 September include 4 Pieds, AchatDesign, Ada, Allopneus, Aquarelle, Barrire Poker, Boulanger,

Bouygues Telecom, BrandAlley, But, Camaeu, Cariboom, Darty, Easy Fichiers, Feu Vert, reenWeez, Jennyfer, Kiabi, La Boutique Officielle, Monde Bio, National Change, Orange, Partouche, RazWar, RueDuCommerce, Rue Du Tee Shirt, SFR, Spartoo, Surcouf, Tlthon, Ubaldi. The operators and Atos announced their intention to form a payment institution in February 2011, saying they were aiming for a mid-2011 service launch.
I Paypal has announced in-store mobile payments technologies that do not require NFC in PoS terminals or phones. The intention is to let a user enter a telephone number and a personal identification number and the amount will be charged to a bank account or card associated with the number. PayPal added that it also plans to issue a plastic card at the point of sale. There is also an intention to emnable users to scan items in-store using a barcode, pay through Paypal and then exit the store without needing to queue at a till.

go to www.mobileeurope.co.uk for the latest mobile news

Mobile Europe | 13

BSS/OSS News
Telefonica Spain l Fizzback l Orange Switzerland

TELEFONICA DOUBLES REDKNEE INVESTMENT FOR PRECISION TARIFF ANALYSIS

Telefonica Spain is doubling its investment in pricing analysis technology from Redknee, to allow it to generate more precise business intelligence about its business and consumer customer segments.

PRECISION BECOMES MUCH MORE IMPORTANT

Redknee CEO Lucas Skoczkowski said that he also expects to see other Telefonica properties in Europe and Latin America step up their investment in Redknees products and services. Redknees other Spanish customers Vodafone, Orange and KPN are already in active discussions to do so, Skoczkowski added. Redknee founded its presence in Spain through the acquisition last year of Madrid-based Nimbus Systems for 11.25 million. The software vendor said that Telefonica Spain will spend double the amount with it this year compared to last year, adding customer segements and increased funtionalities to Redknee's Price Simulator package. Explaining this rising interest in detailed customer analysis, such as that performed by Redknees Price Simulator package, Skoczkowski said, Operators are looking to drive a lot higher efficiency, and more understanding, of how to best tailor their businesses to extract more value from each of their customer segments: so precision becomes much more important.

Historically there has been sufficient room in the market so that precision wasnt necessarily the operating word. That has changed, however, and operators are under greater pressure to identify new customer segments, and address those with the most efficient and profitable tariffs and bundles. We see Price Simulator as a really great way to have a very specific ability added to the operators business which then ties into both marketing and finance roles in the organisation. When we run reports we not only allow our customers to understand how profitable segments are but also how that compares to all other tariffs from their competitors in that market. That means you can say not only if a tariff is likely to be good for you as a business, but you can use it to differentiate, and be sure you have a chance to be successful in a segment, Skoczkowski said. For more, see www.mobileeurope.co.uk/ news/news-analysis/8920

NICE BUYS FIZZBACK FOR $80 MILLION

Investor hails more than five times return on exit
CEM service provider Fizzback, which counts BT, Virgin Media, T-Mobile, Carphone Warehouse and Meteor amongst its customers, has been bought by NICE for $80 million. The acquisition will combine Fizzback's customer response software service termed Voice of the Customer with NICE's customer analytics capability. Fizzback offers its Voice of the Customer product on a SaaS basis. The service sends consumers requests for feedback relating to a specific interaction or transaction via mobile, web or social media. The customer feedback (or Fizzback) is then analysed by the system to determine a relevant response. The company's lead investor said that it currently generates 150 million of these feedback responses annually. Zeevi Bregman, President and CEO of NICE explained the acquisition, said, With the addition of Fizzback, NICE is expanding the scope of its capabilities by introducing a Customer Experience Management solution with the most complete Voice of the Customer offering. This enables our customers to more effectively capture, understand and leverage VoC as the foundation to a cross-enterprise CEM strategy. Mike Chalfen, of private equity investor Advent Tech, said in a Twitter post that his company had made overall 6x our money through the exit. He added that the sale would also give Fizzback big distribution for its SaaS based solution.

Orange selects CustVox for Swiss CEM operations

CustVox has been selected by France Telecom to deliver a multi-lingual Customer Experience Management platform for its Swiss affiliate, Orange. CustVox said that the agreement would significantly improve customer loyalty and share of wallet for the telecom giant. The decision to pick CustVox came after a six-months pilot. After two months using a CustVox "out of box" solution, Orange was able to identify and target customers who were extremely unsatisfied early in the lifecycle. In nearly 55% of the cases they were able to improve their satisfaction. The rollout will begin immediately to support France Telecom's goal to position Orange as the Best loved communication brand in the market.

14 | Mobile Europe

News Feature
l traffic management l

TRAFFIC MANAGEMENT TAKES CENTRAL STAGE

Bytemobile has launched a new product line, the T3100 Adaptive Traffic Manager, which it is marketing as an integrated solution to enable operators to gain access to real time intelligence on network conditions and user experiences, and take traffic management decisions accordingly. By collapsing DPI, load balancing, caching and optimisation capabilities into one element, Bytemobile says it is creating a new class of network component. The idea is that operators have a way to react to live events, and ensure the user experience, as data traffic volumes increase in next generation mobile networks. By doing so, they could also create new monetisation opportunites. Bytemobile sees 4G/LTE as the inflection point for the introduction of these solutions, and says that the need for traffic management solutions has caught the big equipment manufacturers on the hop. Keith Dyer spoke to Ronny Haraldsvik, Vice President, Global Marketing, and Jeff Sanderson, Senior Director of Product Marketing (Adaptive Traffic Management), Bytemobile. They explained the thinking behind the design and development of the T3100 series, what operator needs it meets, and how they expect the competition to react. What is the T3100 about, how is it different from your current Unison optimisation approach? Jeff Sanderson: We are taking what we do today and making sure that we are moving forward with the evolution of mobile networks to try and manage the capacity crunch by creating a more holistic approach to the traffic management problem. Traffic management for operators tends to be a pretty fragmented approach today. Theyre doing some specific DPI at certain points in the network, either standalone or integrated into components like the GGSN, and they create an enforcement point for being able to control the logical pipe a subscriber can get access to in terms of throughput and so forth. We typically sit behind that and optimise the content. Where we differentiate that we inspect the content, and that allows us to understand and manipulate the content, largely to deliver a better user experience. The benefits of that, and the main focus of the value proposition, is the amount of data it reduces in the downstream network, creating a less congested network where more users can get on and enjoy the data services. Ronny Haraldsvik: By leveraging the insight of being able to see everything thats going on, we can bring that together into one platform that no-one else can do. So sitting at that Layer6-7 level gives us a unique advantage. Its a lot easier to go down the OSI stack than it is to go back up again, so we have a unique situation where the DPI people and the GGSN guys are at L2-3-4-5, but they do very little with the content. They can see what the packet is and where its headed and thats it, they dont follow the flow, etc. Theyre trying to go up the stack now, and looking at how do we do optimisation, what else can we do? But rather than inserting more network elements into the architecture were collapsing them and bringing them together. What are the benefits of that collapsed, integrated approach? Jeff Sanderson: What we dont do today in Unison is extend our field of vision to look at all the applications; so as a subscriber on your laptop connected to the mobile internet you probably have other multiple applications open at the same time as youre watching a video. So by opening up our field of vision we can make assessments based on network conditions plus all the other applications you are using. So we can start to make wiser judgements on how we can deliver a better UE to you. So for example we could put some level of restriction on downloading an attachment to your PC, to give a bit of a boost to a real time application such as video. The way we do it is to monitor real time analytics on the platform, track a user and get a view in real time of how much stalling there is, how quick a page is downloading in reference to other benchmarks, and come up with an index. Based on that running index we then apply traffic management policy in a real adaptive fashion. Because we control each and every packet of each and every flow we are able to do it adaptively during the session. The benefit of what we do from an operator perspective is that they have a far better paradigm of being able to tariff. This is a contentious area. Today their segmentation paradigms are pretty basic, and mostly volume based. Moving forward they could break out of that model. We have seen a number of vendors putting together a policy-optimisation-traffic management portfolio, whether thats coming at it through acquisition, like Amdocs and Bridgewater, or through partnership as with Vantrixx and Ericsson, or Juniper and Openwave. Ronny Haraldvisk: The shift in traffic, where its headed, over the past 12 months completely took NEPs by surprise. They have standard elements, yet lo and behold these non-standard elements are now taking control of traffic, and helping operators mitigate the effects of this onslaught of traffic. No-one has this fully Cisco has DPI and they are saying anything can be done on the GGSN. We know better and operators know better. Thats why we see these announcements that are more or less trying to cobble together the GGSN with some optimisation and portfolio stuff. Its not taking a holistic view of traffic management, its a reaction. This all related to whats going on in the network, where the traffic pattern has shifted and operators need more intelligence and insight. I would not be surprised if a month from now another adaptive traffic management solution is announced. Read the full interview at: mobileeurope.co.uk/news/news-analysis/8911.

go to www.mobileeurope.co.uk for the latest mobile news

Mobile Europe | 15

Advertorial Samsung

HOW CAN OPERATORS MEET THE INCREASING DEMAND FOR MOBILE DATA WHILE REDUCING CAPEX AND OPEX?
While Smartphones are driving the need for network capacity expansion, network operators are targeted with reducing CapEx and OpEx budgets.

The introduction of Smartphones has seen enormous take-up amongst business users and consumers. Smartphones represented 23% of all active handsets in Western Europe in 2010. They will account for more than half by 2014, and will have reached 72% by 2016 (see Figure 1). However the implications for the operators are far reaching as the mobile data explosion puts enormous strain on the operators existing 3G networks. Operators around the world are all facing an exponential growth in data traffic as a result of the rapid uptake in Smartphones. This has led to cell splitting and additional cells being deployed to handle the dramatic increase in data traffic. However, an increase in the number of cells in an urban environment results in smaller cell sizes and reduced performance due to inter-cell interference and thus operators face rising OPEX costs to manage a large number of cell configuration changes, and a subsequent cell optimisation, without fully meeting the capacity requirements. As seen in Figure 2, smart devices have produced a huge mobile data traffic increase, which has reached more than 1 Giga Byte per subscriber per month in Korea.

Figure 2: Average Data Traffic per Subscriber [Source: Korea Telecom, SK Telecom, 2011]

3G networks were not designed for heavy data usage and are now creaking under the load. Whats more, data network performance becomes a key issue for operators as users develop higher expectations and churn to alternative networks that can better support their data consumption needs.

Figure 1: Active handsets by type in Western Europe [Source: Analysis Mason, 2011]

IS INCREASED CELL COUNT THE SOLUTION?

To deal with exponentially growing traffic, some operators have split existing cells or adopted small cells. However, increasing the number of cells while reducing their size in an urban environment results in lower performance due to increased inter-cell interference. Additionally, on top of having to invest additional CapEx, operators face rising OpEx from the configuration and optimization of an increasing number of cell sites, without fully meeting the capacity requirements. So, whilst additional cells provide additional capacity they also introduce the unwanted factors of increased interference, CapEx and OpEx.

THE OFDMA PARADIGM

Orthogonal Frequency Division Multiple Access (OFDMA) technology is playing a key role to solve current network issues in the mobile broadband era, because OFDMA can deliver better peak and average spectral efficiency. OFDMA technology is a key component of LTE and WiFi networks.

16 | Mobile Europe

Advertorial Samsung
IS WI-FI THE SOLUTION?
Wi-Fi was introduced back in the early nineties as the first way to access the internet wirelessly. Its benefits include less cost, time and space to deploy. In addition, Wi-Fi chipsets are inexpensive, which has led to many mobile devices including Smartphones and laptops being able to connect wirelessly to the Internet via Wi-Fi. According to the Wi-Fi alliance, about 800 million new Wi-Fi devices are introduced every year. However, because the Wi-Fi spectrum is unregulated and open to all, Wi-Fi access points proliferate and compete for the same small piece of spectrum. As a result, interference levels increase and network increasing number of cell sites, without fully meeting the capacity requirements. So, whilst additional cells provide additional capacity they also introduce the unwanted factors of increased interference, CapEx and OpEx.
Figure 3: Average Active

IS LTE THE SOLUTION?

LTE, the latest standard in 3GPP focuses on adopting 4G mobile communication technology through an all-IP flat networking architecture. LTE is expected to play a key role in solving current network capacity issues, because it can deliver better spectral efficiency. Since the world's first available LTE-service was launched by TeliaSonera in Sweden in 2009, 218 mobile network operators in 81 countries have announced their commitment to this technology. The number of LTE subscribers is expected to grow rapidly as operators and manufacturers work together to build up the LTE ecosystem. However, it is not enough to just adopt LTE technology to handle increased mobile data traffic. Now is the time for operators to embrace mobile networks that minimize the risks of inter-cell interference and excessive network management cost, as well as networks that guarantee higher performance in a cost-efficient way. Such LTE technology is available now in the form of Smart LTE Solutions from Samsung.

Users per Cell over Time and Effected by Cell Splitting [Source: Samsung, 2011]

February 2011. This solution dramatically reduces OPEX and CAPEX by reducing several cell sites into a centralized one. With easy installation and self-optimization, Centralized Base Station drastically lowers CAPEX and OPEX for network operator while providing all the same Smart LTE advantages. Samsung is also committed to minimize inter-cell interference for Heterogeneous Networks, to enhance cell edge throughput and average cell throughput. Commercial Heterogeneous networks comprising macrocells and small-cells with Samsungs Smart LTE technology will be commercialized in 2012.

CONCLUSION
Increased data demand is a reality for todays mobile network operators and the speed and quality of data access is increasingly a key differentiator for the consumer. The 3G networks are straining both from the data demand and also the associated signalling requirements. Operators not only need to plan their migration to LTE as a matter of urgency but they also need to carefully consider their LTE network architecture; maximising the benefits offered by infrastructure vendors and deploying the most appropriate options in the macro, micro/pico and femto layers. Careful selection of the right Smart LTE Solution can provide operators with improvements in incremental CapEx, OpEx and the user experience, therefore ensuring the satisfaction of both the CFO and the end customer. For more information, visit http://www.samsungnetwork.com

THE SOLUTION: SMART LTE

After providing the first commercial LTE network in USA in September 2010, Samsung has developed an advanced solution for supporting unprecedented network data traffic needs. Aptly called Smart LTE, it offers benefits unimaginable with traditional LTE deployments. Smart LTE hosts a unique air resource management function and guarantees dramatic increase in coverage and capacity. This results in a huge reduction in the number of required cell sites, leading to reduction in CAPEX and OPEX for the operator. The latest offering within Smart LTE, the Centralized Bank Base Station, is to be rolled out in Korea at the end of this year (2011). Based on a close collaboration with a leading operator, Samsung unveiled this innovative solution at the Mobile World Congress (MWC) in

ABOUT THE AUTHOR Mark Thompson is responsible for the Sales & Marketing of Samsung LTE Solutions throughout Europe. Mark is a Fellow of the Institute of Sales & Marketing Managers (FinstSMM).

Mobile Europe | 17

MOBILE EUROPE

INSIGHT REPORT

The LTE Generation: SMALLER AND CLOUDIER

REPORT SPONSORS: CONTENTS:

P14 P15 P15 P16 P18 P19 P20
Foreword Introduction Small cell drivers Heterogenous Networks Son at first, cloudy later Small cell backhaul Vendor updates

INSIGHT REPORT

EDITORS FOREWORD
Keith Dyer introduces this issues Insight Report, and traces the course of a network evolution that looks set to take networks smaller, and change the architecture of the networks themselves.

The aim of LTE to provider higher capacities with lower cost of operation has brought with it the need for the Heterogenous Network; small cells layered with the macro network, working together to provide coverage and capacity. The fact that LTE looks like it might work better, or be more spectrally efficient, where small cells operate with large cells in shared spectrum has led many operators to assume they will deploy, at some point, a small cell strategy for LTE. In turn this creates a need for SON capabilities, so that networks can work without interference and disruption, and with handover of sessions and calls between small and macro cells. It also creates a different vision for backhaul. Finally, it has fostered another approach, active intelligent antenna with integrated radio, and plans to pool baseband processing power the Cloud RAN. This vision is being drawn from two ends of a continuous line. Put crudely, the femtocell players, who already have SON elements designed in, and of course low price points and low power operation, address this from the bottom end. The major equipment NEPs, with on or two notable exceptions, have started to address this from the other side by integrating small cells within an overall architecture in LTE, using the SON standards that are written into LTE standards at 3GPP. And they have started to go further, to iterate a vision of a network that makes the most of centralised processing power, the Cloud RAN. This report, drawn together by a Mobile Europe team from a variety of sources, after many conversations, after input from many commentators, is intended to trace the rationale for these two main changes in network design, to put into context the challenges that will need to be overcome, and to guid the reader through the headline strategies of the main players addressing the opportunity. Where we mention specific company names, it is often as a means to illustrate wider market developments, and it should not be assumed these are the only companies active in a certain field, or that any specific endorsement is intended. We have found this an interesting and fruitful report to compile and hope you find value this latest Insight Report from Mobile Europe. Keith Dyer, Editor, Mobile Europe

20 | Mobile Europe Insight Report

INSIGHT REPORT

INTRODUCTION
he move to imagining a reformed mobile network architecture starts with accepting the logic that smaller cells, no matter what terminology you apply pico, metro femto, femto will have to play a greater role in mobile network deployments. Despite concerted moves to find a happy medium spectrum range between the 800MHz and 2.6GHz bands, with re-farmed 1800MHz spectrum the favourite LTE target of many operators, there is now growing, if not quite universal, acceptance that small cells will increasingly be deployed to provide spot coverage and capacity in a range of outdoor environments. ABI Research states that the outdoor picocell market, which it characterises as still in the early stages of development, is projected to reach $8 billion in global revenues by 2016.Indeed, ABI points out that while many outdoor microcells are in

operation and have been for years, outdoor picocells are undergoing operator trials, with several companies focusing their attention on alternatives that are designed to be lower cost and easier-todeploy. These outdoor picocells require little of the permissions and supporting plant of macro-base stations. They can plug onto utility poles, lamp-posts, and rooftops, sharing power supplies from cable plant, for example. That then raises the question of how traffic will be backhauled from a multitude of sites an area identified as a major challenge by ABI with the candidates being fibre, copper, microwave, E-band, and point-tomultipoint microwave. ABI thinks that operators are likely to start with identifying specific hot sites in congested metro areas, and start using outdoor picocells to alleviate capacity demand. Metro areas arent the only places where small cells are expected to

appear. Apart from outdoor small cells having a role in urban areas, they also have a role in rural and suburban areas where zoning restrictions prevent macro tower deployments.Yet the potential network of the future, with thousands of small sites dotted into a macro network in shared spectrum, has raised another possibility. For the most cost-efficient deployment and operation, vendors and operators are considering an approach that centralises network intelligence, pooling what would have once been processing power dedicated to the base station, and sharing it across a collection of smaller sites, each of which are equipped with more intelligent, active antennas. This vision, for want of a better word, is known as the Cloud RAN. This report traces that journey, looks at the challenges it presents, and at the offerings of the major companies driving the vision.

SMALL CELL DRIVERS

n an IP/Ethernet and small cell backhaul survey carried out in 2011 by Infonetics, 58% of the operators that the analyst firm interviewed said they would deploy small cells (microcells and picocells) by the end of 2011, with 68% planning to in the future. Infonetics took this as a clear indication that small cells are a growing part of a total coverage/capacity/quality strategy for mobile broadband networks. With LTE still an emerging technology, only 5% of respondents said that they would have deployed LTE microcells/picocells within 2011, yet the scope for growth is shown in the fact that 37% more plan to deploy in 2012 or later. So although we are still very early in the game for LTE microcells/picocells, there seems cause to believe that as licenses are awarded and spectrum dedicated for LTE becomes available, the growth in small cell deployment will follow. NTT DoCoMos SVP of R&D Strategy Seizo Onoe, for

example, has said publicly that DoCoMo would have 35,000 eNodeBs by the end of 2014, many of them providing coverage over no more than 100-200 metres. There is an apparent link between LTE deployment and increasing small cell deployment. Although some operators worry that deploying large numbers of LTE sites will bring with it increased costs in terms of new antenna lines, backhaul and network management, there is also evidence that LTE networks will operate at optimum spectral efficiency where

Telefonicas results were showing that with cell sizes three times smaller, or for three times the number of cells, Telefonica was achieving seven times the capacity.

small cells are interleaved with macro layers. Telefonica has presented results of trials in Spain which appeared to show that optimum performance was actually achieved when small cells and macro cells operated together in shared, nonpartitioned, spectrum. Telefonicas radio manager, Jaime LLuch, said that results were showing that with cell sizes three times smaller, or for three times the number of cells, Telefonica was achieving seven times the capacity. This involved a spectrum sharing strategy, where 20MHz was shared between macro and micro layers. This enabled Telefonica to target very precise traffic locations, using clusters of cells to see huge capacity
Mobile Europe Insight Report | 21

INSIGHT REPORT
increases. The optimised location of micro versus using existing macros sites gave 40-50% better throughput per average user, Lluch reported. This small cell performance boost could be crucial to mobile operators. Operators are of course tasked with differentiating on network speeds, and the sorts of offers they can make users perhaps based on location, time of day, traffic type, and quality of service. Being able to This need for targeted, location-specific capacity solutions, operating in harness with macro layer cells, forms the chief driver for small cell LTE deployment. With this demand comes a number of challenges; around interference management, deployment, backhaul, the need for new antenna lines. But it has also led to the creation of a new orthodoxy in the industry, the concept of the heterogenous network.

This small cell performance boost could be crucial to mobile operator tasked with differentiating on network speeds and quality of service
target increased capacity and coverage very precisely is attractive.

HETEROGENOUS NETWORKS
Certainly the big vendors have encouraged the new orthodoxy of the HetNet. Ericsson, which doesnt market anything called a femtocell, is committed to the HetNet, or the heterogenous network, as the dominant strategy for its mobeil broadband network operator customers. As part of that strategy it has announced its Antenna Integrated Radio, marking it as a key step on the road to the integrated, multi-sized network. In January this year Alcatel-Lucent announced a miniature base station called lightRadio a stylistically innovative cube design that packs a large punch in a very small glove. Huawei and ZTE have both announced a focus on ever-smaller microcells, with ZTE also making an announcement that it too would follow a Cloud RAN strategy. Nokia Siemens Networks recently announced Liquid Radio, and its overall cloud network concept, Liquid Net, which uses distributed antennae and virtualised baseband processing to provide a highly distributed architecture built around small cells and miniature basestation designs. Allied to these efforts are those of the dedicated femto vendors, those who are approaching the small cell opportunity from the other end of the size chart looking at a scaling up of capacities, whilst retaining the built in SON and management capabilities of their products. Any HetNet strategy will succeed or fail on the ability of operators to manage this collection of small cells within their existing network management and operating tools. Small cells will need to be as low touch as possible for operators. They will need to be easy to locate, either for regulatory or network management reasons, and will have to manage neighbouring cell relations to cause minimum interference. Heterogenous networks those with small and macro cells will be part of 3GPP Release 10 of the LTE standard, but some are warning network equipment with the required interference management and hand-off support will not be available in time with LTE release dates. This could compromise HetNet plans, although others are viewing it as an opportunity. One such is Wazco, a company that has teamed with Interphase, AirHop Communications and DataSoft to market an LTE, small cell called the MetroStorm. Dubbed LTE in a Streetlamp, Wazcos introduced MetroStorm is a multi-sector, high- small base station for the LTE mobile-infrastructure market that allies the ability to mount the unit on streelights and power poles with selforganizing, self-optimiszing, elements. In fact, most of the dedicated femto players see SON, and advanced interference management, as a natural advantage in the outdoor small cell market over their macro rivals. So Ubiquisy, for example, is one dedicated small cell company that announced an agreement with Texas Instruments to create small cells that will combine TI's infrastructure solutions with Ubiquisys' adaptive and selforganizing capabilities to deliver what Ubiquisys calls an adaptive small cell. The two companies plan to bring to market a range of dual-mode WCDMA/LTE small cells for public-space and metro environments. The first products are expected during the first half of 2012. Although SON elements are specified within 3GPP LTE standards, the delivery of SON within networks is being seen as a market differentiator by equipment vendors, many of whom have launched dedicated SON programmes something that becomes vital in the HetNet.

LTE in operation in Sweden

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FORECASTS: SON AT FIRST, CLOUDY LATER

o Heterogeneous Networks (HetNets) composed of a combincation of macro cells, small cells, and/or Cloud RAN distributed base stations look set to form the future of mobile wireless networks. Research company Maravedis says that the small cell market will, as a result, begin to show real growth in 2012, and reach up to $5 billion by 2014. So of the two strategies developed to meet meet operators' need for the HetNet small base stations, or distributed intelligent antennas, which is likely to meet more success? Maravedis Fernando Donoso pointed out in a recent article that major network vendors are offering macro cell derived pico cells.

in automated femto derived metro cell deployments, he said. Indeed, Donoso and Maravedis think SON support is essential to success. Adding the massive number of base stations required in the future will demand sophisticated and effective auto-configuration and autooptimization capabilities to minimize deployment and operational costs" said

So who will provide the dominant technology for small cell deployments? That may depend on the overall speed of take-up of LTE.

Tier-2 vendors (plus Alcatel-Lucent) are offering femto cell derived small cells (also known as carrier femto cells or carrier metro cells). Both technologies represent deployable small cell solutions for mobile network traffic. However, both carrier pico cells and carrier metro cells have trade-offs at this time:Macro derived pico cells are more expensive, larger format, and have higher power consumption than femto derived metro cells. SON support for macro derived pico cells as well as their deployment automation features parallel existing macro cells functionality. There is still a lack of clarity concerning whether interference can be adequately managed
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Fernando Donoso, Maravedis Senior Analyst. A vendor's SON suite, Network Management System (NMS), and OSS integration capabilities are likely to become more important to the success of the solution than the actual small cell device. Huawei, for example, has developed a feature called SingleSON (single self optimising network), which extends their SON capability developed for LTE to operate with 3G and GSM too. This automatically reconfigures and tunes the network to match demand and the environment. From their viewpoint, cellsites must be simple to install "plug and

play while operating very efficiently. Donosos view is that femto cell vendors are, overall, more mature in developing the automated deployment and operation features that small cell networks will require. Mravedis expects both pico cells and carrier metro cells to become fully proven, complete solutions in the short to medium term, while increasing SoC sophistication and cost effectiveness drives down costs for both types of solutions. So who will provide the dominant technology for small cell deployments? That may depend on the overall speed of take-up of LTE. Maravedis forecasts that a rapid take off of the LTE market and small cell deployments will tend to favour the metro cell and carrier Wi-Fi providers. On the other hand, a slower take off of the LTE market will favour the Tier-1 incumbent vendors who have folded small cells into their mainstream product offers. Donoso points out that carrier WiFi vendors are also growing quickly and have scored some impressive contract awards with Tier-1 carriers. If the femto cell vendors falter in their promise of hassle-free automated deployment, carrier Wi-Fi vendors could take over a substantial portion of the small cell market, leaving the Tier-1 vendors to provide the larger pico cell equipment. In short, Maravedis sees carrier Wi-Fi, carrier femto and pico cells co-existing as complimentary technologies not only in the short term but in the long, with anticipated future advances in silicon breaking down the distinctions between carrier femto cells and pico cells in two to three years. The adoption of the Cloud RAN model looks set to be a fair way further out. This is mainly because many of these approaches are still on the drawing board, designware rather than hardware or software. Yet the the move to smaller cells, integrated into macro networks, with self organising and self optimising capabilities need not preclude to move to a Cloud RAN. Indeed, in some ways it lays the groundwork, by preparing network planners for a more radical shake-up of network architectures.

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SMALL CELL BACKHAUL

here is, however, a major challenge for operators thinking of deploying networks composed of small cells, carrier WiFi and remote antenna: how to deploy the required backhaul. A shift to flatter IP-centric architecture brings new cell site topologies as operators migrate to LTE. This means that macro sites will have to accommodate 2G, 3G, and LTE, plus there will be a greater proportion of small (micro/pico) cell sites to provide the coverage density required to support high bandwidth services. Equipment that sits on streetlights or similar street furniture is one thing; but running fibre to hundreds of cells in an urban environment is not going to be practical. That is why WiFi/cellular dual mode vendors such as BelAir have proposed using existing street plant from cable companies. Microwave, point to multipoint microwave and even free space optics could prove alternatives, as the industry tries to find a cost-efficient and technically scaleable solution to the deployment of bunches of radios that each carry hundreds of megabits of data traffic simultaneously. With each location-specific, traffic-busting small cell comes the requirement for high capacity backhaul. So while outdoor small cells have received a lot of attention lately, small cell backhaul is also coming into its own. Due to its unique characteristics, there are numerous considerations that need to be taken into account for a small cell backhaul solution. These include product footprint, range,

cost, Ethernet/IP support, and capacity. ABI Research says that by 2016, an estimated 58% of outdoor small cells will be backhauled using wireless techniques. While fiber, copper, and traditional microwave are currently being used to backhaul rooftop micro base stations, the emergence of wireless technologies like NLOS OFDM (sub 6 GHz), MMW (60-80 GHz) and also Wi-Fi backhaul solutions could find preference due to their perceived flexibility, low cost and ability to use point-to-multipoint (PMP) and pointto-point (PTP) techniques to backhaul clusters or rows of small cells. Small cell backhaul space is still in its early days, with a number of small vendors positioning their solutions, especially on the wireless backhaul side. Companies such as Cambridge Broadband networks in P2MP microwave, BluWan and millimeter wave specialists BridgeWave, Siklu and E-Band Communications are all targetting the small cell opportunity, as are the major microwave vendors such as NEC with its ePASOLINK millimeter wave product line. A company like Wazco, mentioned above, has partnered with Athena Wireless Communications, to form MetroHaul, an solution that combines Wazcos multisector LTE small cell with Athenas backhaul radio for backhaul. ABI Research, however, says that the cost of these solutions still needs to come down to allow operators to make a favorable small cell business case. Microwave and millimeter wave technologies are evolving to accommodate

the emerging next-generation radio access network, by offering higher bandwidth, flexible frequency options, and new backhaul radio form factors such as alloutdoor, zero-footprint solutions. The relatively small but fast-growing millimeter wave equipment market jumped 121% in 2010 to $69 million worldwide. By 2015, Infonetics expects that 70% of millimeter wave equipment will be deployed in backhaul networks as the demand for high capacity mobile backhaul solutions for metro areas with high cell density and small cells in particular. At the moment, though, analysis of small cell backhaul is hard, as small cell deployment strategies for LTE are themselves unformed.

SUMMARY
his utopian network of the future the HetNet is a combined mix of macro/pico/femto and relay cellsites using 2G/3G and 4G in a co-ordinated system. That coordination will be key, as we have seen, with SON being a key differentiator. With all of the large basestation vendors now saying that femtocells (whether they call them small cells, picocells or something else) play a part in meeting the

traffic capacity demands of the future, theres no doubt that there will need to be a move to integrated network management. That move to integrated management, SON, across 3G and LTE networks, macro and micro and picocell networks will come to be the defining quality of the Het Net. Another key area will be the developing Cloud RAN strategies of the major vendors. An update on the activities, and

That move to integrated management across 3G and LTE networks, macro and micro and picocell networks will come to be the defining quality of the Het Net.
related developments, of the major vendors and their competitors, is what follows next in this report, on a vendor by vendor basis.
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INSIGHT REPORT

ALCATEL LUCENT LIGHTRADIO

he first company to publicly iterate its plans for cloud based radio, using small, intelligent antennas distributed in a heterogenous network, was Alcatel-Lucent, which launched its lightRadio antenna segment in January 2011. Alcatel-Lucent said that the current choices for augmenting capacity are to increase the number of carriers (the method used by W-CDMA) or improve the spectral bandwidth of each carrier (LTEs method), preferably in the same band as existing deployed radio carriers. This approach usually provides the least-expensive solution, since the same equipment practice and radio technology can often be re-used, though with expanded capacity. If spectral bandwidth increases are in a new frequency band, there is no clear advantage to using the same generation of wireless technology, since new antennas, radios and baseband equipment will be required. However, capacity needs to be matched not only to the demand in specific locations but also to the device population and related usage

Above: A stack of Alcatel-Lucents lightRadio cubes Below: lightRadio architecture overview, with antennas, radios, baseband, controllers and management

intensity. Therefore, a combination of existing and emerging technologies is required. Al-Lus view is that lightRadio makes this possible, enabling operators to get it right when deploying a solution to match user demand or expectations, while continuously optimising the overall solution all the way from the antenna to baseband processing and controller elements. Baseband digital processing modules are built on a new System on a Chip (SoC) technology that incorporates a number of previously discrete, technology-specific components into a single, low-cost, highperformance device that is technology agnostic. In addition, it is remotely programmable to accommodate changing features and even changing radio technologies. Therefore, when W-CDMA customers shift to new LTE-based devices, the baseband module that has been serving them can be remotely reprogrammed as an LTE baseband module. In addition, increases in spectral bandwidth can be accommodated, when combined with advanced load-balancing and modem-pooling functions. Finally, wideband radios and adaptive antennas enable broadening of an existing spectral band or extension to a new band without adding an entirely new radio and antenna to the cell tower. Five key business enablers of the lightRadio paradigm are all aimed at adding sufficient capacity, in the right place, with the right technology, to optimise end user experience and operator economics. The lightRadio architecture, highlighting two different wireless scale points conventional macro cells and smaller metro cells as well as three different baseband processing configurations: baseband processing in the radio head (all-in one), processing at the base of the tower (conventional baseband units) and centralised,

pooled baseband processing (in the cloud). The five technology components of the lightRadio product family include antennas, radios, baseband, controllers and management. These elements collectively create the following five business enablers,: 1. Increase in spectral bandwidth 2. Optimisation of cell site capacity 3. Optimisation of technology evolution 4. Maximum utilisation of new spectral bands 5. Optimisation of antenna configuration BENEFITS OF LIGHTRADIO, AS SEEN BY ALCATEL-LUCENT: Improves the environment: lightRadio reduces energy consumption of mobile networks by up to 50% over current radio access network equipment. (As a point of reference, Bell Labs research estimates that basestations globally emit roughly 18,000,000 metric tons of CO2 per year). Also, lightRadio provides an alternative to today's jungle of large overcrowded cell site towers by enabling small antennas anywhere. Addresses digital divide: By reducing the cell site to just the antenna and leveraging future advances in microwave backhaul and compression techniques, this technology will eventually enable the easy creation of broadband coverage virtually anywhere there is power (electricity, sun, wind) by using microwave to connect back to the network. Offers major savings for operators: Thanks to lightRadio's impact on site, energy, operations and maintenance costs; when combined with small cells and LTE, this new solution can lead to a reduction of total cost of ownership (TCO) of mobile networks up to 50% (as a point of reference, Bell Labs estimates that TCO spent by mobile operators in mobile access in 2010 was 150 billion Euros). Enhances quality for end users: by doubling macro capacity and reducing the cost per bit lightRadio opens up the possibility to offer new services and price points. Alcatel-Lucent says network operators such as France Telecom/Orange, Telefonica and China Mobile are now engaged in moving to market implementation of lightRadio.

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ERICSSON ANTENNA INTEGRATED RADIO (AIR)

ricsson announced Ericsson AIR (antenna integrated radio) solution at the Mobile World Congress 2011 in Barcelona, following closely on the heels of Al-Lus lightRadio announcement. Ericssons radio solution is based on a design that compactly integrates the antenna into the radio unit, following a partnership with Kathrein. As with light Radio, the multi-standard solution is aimed at ensuring highly efficient and smooth introduction of new technologies, both 3G and 4G. Ericsson says that a new standard or a new frequency band can easily be introduced by simply adding AIR and swapping the existing antenna. Mobile operators will also benefit from reduced costs due to shorter installation time, because AIR has fewer units and fewer interconnections compared to traditional site solutions, as with other similar solutions. Ericssons claim is that field trials in customer networks proved a reduction of integration and installation time of up to 30 percent. In addition, the field trial demonstrated that the solution provides reduced power consumption of up to 42 percent, mainly due to reduced feeder loss and simplified cooling. It has been pointed out that, at least in public announcements to date, that Ericsson has not gone as far as Al-Lu as its baseband remains at the foot of the mast, while lightRadio removes it from the cell site and sees baseband processing done in the cloud. In future, conversations with Ericsson make it clear that the baseband processing will also be integrated into the same unit, the vendor said. The AIR base stations can be used in 2G, 3G and LTE networks, and come in different sizes. The smallest has a radius of 100 metres and is not too far different from the size of many outdoor femtocells. Also similar to femtos will be the fact that the units will feature automated configuration a key aspect in the

turning on of thousands of small cells within a network. The small products will not be commercial until 2012, although operators have had sight of pre-market, larger models, through 2011. Although Ericsson has always resisted the femto words, its arguments in favour of its new product, that it will help carriers add new capacity and coverage with lower cost and power consumption are very close to those used by the proponents of femto technology. Ulf Ewaldson, head of radio, said the AIR product is the first step in a broader 'HetNet' strategy. We are experiencing a tremendous take-off in mobile broadband and the user expectations on speed and coverage are increasing the demands on the networks. In order to cope with the future capacity demands, we have a clearly defined small cell strategy. I am proud to announce that the AIR architecture is the first stepping stone towards a heterogeneous network, he said.

Its important to note that Ericsson positions its Network Integrated WiFi solution as one part of its HetNet concept

INTEGRATED CARRIER WIFI Ericsson has also embraced another small cell technology that is being viewed as an important tool in the need to meet wireless bandwidth demands carrier WiFi. Launched in September 2011, Ericssons Network Integrated WiFi

solution enables seamless connection of smartphones to operatorcontrolled WiFi access without requiring a specific software client in the device and without any user interaction. The Network Integrated Wi-Fi solution is markets as providing an increase to overall network capacity, especially in congested areas. It also supports the fast-growing ecosystem of WiFi enabled devices. Ericsson hopes that operators can benefit from new revenue models from wholesale of WiFi access, by using a carrier WiFi solution to provide the basis for business agreements between themselves and hot-spot providers. Its important to note that Ericsson positions its Network Integrated WiFi solution as one part of its HetNet concept. The solution authenticates SIM based devices in the Home Location Register and connects traffic from the WiFi access network, through the mobile packet network and up to the mobile operator's service environment. As the smartphone user is recognised by the network, the subscription profile is maintained also when connected via WiFi. This provides users with to the same services as when connected to the mobile network. The first release includes local off-load of the traffic from the SmartEdge Border Network Gateway (BNG).

Above left: Ericssons HetNet vision Above: Antenna Integrated Radio (Back view)

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HUAWEI THE SINGLERAN

eemingly little interested in the Cloud RAN game, with little public mention of the concept, Huawei has launched its end-to-end HetNet solution as a future-proof mobile broadband architecture made up of multilayer networks. HetNet employs the technologies of multi-layer coordination, eICIC (Inter-Cell Interference Coordination), and SON to improve the capacity of networks up to five times. Huawei' bases its HetNet vision on its LTE Micro BTS (base transceiver station), a product that is designed to extract the full performance out of an LTE network by employing features such as extreme data rate (DL 150Mbps, UL 50Mbps on 20MHz band, 2*2MIMO) and integrated SON (selfconfiguration, self-optimisation, and selfmaintenance).

Huawei says its solutions are geared to being implemented with existing networks

The LTE Micro BTS is part of Huaweis SingleRAN solution, that adopts integrated BTS (base transceiver station), BSC (base station controller), OSS (operating support system) and site solutions to drive the three radio features, including LTE, within a single network. Huawei says this means operators are able to choose different feature combinations to suit their business. For now, Huawei is leaving cloud RAN messaging alone, and trying to capitalise on SingleRAN. The Chinese firms four microcells consist of the BTS3202E for LTE, the BTS3902E for UMTS, and the BTS3702E and BTS3701B for WiMAX, all part of the SingleRAN family and supporting self-organising network capabilities. The new base stations integrate the radio, antenna and baseband in a single compact unit. Huaweis argument against against the Alcatel-Lucent approach, was to point up its reliance on plentiful fibre, and to say that while more radical architectures would be suited to greenfield deployments, its solutions are geared to being implemented with existing sites and networks.

NOKIA SIEMENS NETWORKS LIQUID RADIO AND LIQUID NET

t the heart of Nokia Siemens Networks Liquid Radio is its Flexi Multiradio Antenna System, which the company sees as being deployed as as part of the Liquid Radio architecture that gives operators the ability to respond to the fluid demands of todays networks with baseband pooling. Baseband pooling centralises the resources needed to undertake processing functions common to every base station in a given area, helping to achieve a more cost efficient sharing of resources over a large geographical area. NSN foresees demand for network capacity increasing to up to 1GB per user per day. Not only will this require substantial network investments, but also a unique combination of base station sites for wide area coverage complemented by Wifi
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and small, compact micro, pico and femto cells. Nokia Siemens Networks Flexi Multiradio Antenna System is based on active antenna technology that combines antenna and radio part in one functional enclosure, built with dedicated power amplifiers for each antenna element. The active antenna allows beamforming focusing a particular radio connection and directing it to a specific user as well as handling of multiple technologies in one unit. Together with other layers of coverage provided by macro, pico and micro site configurations, beamforming allows capacity to be directed exactly where the user requires it, delivering up to 65% capacity gain. The Flexi Race is the next step in NSNs

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move to miniaturisation, being described by the vendor as the basic element to build next generation active antennas and future products to build micro and pico cells. Due to its compact size, the Flexi Race is equipped with additional intelligence and scaling options required for this type of deployments. NSN too is committed to the concept of the heterogeneous networks. It describes this approach as key to a reduction of management complexity. Connectivity for different layers of the network in one unified network and user experience will be orchestrated by the companys SON capability and its continuous evolution to fully support cognitive self learning and adaptive networks. Liquid Radio, based on NSNs SONenabled Flexi integrated antennas, itself forms a part of NSNs LiquidNet vision NSNs clearest iteration yet that it too sees the benefits for operators in the Cloud RAN. Liquid Net is NSNs term for the cloudbased network that leverages the capabilities of Liquid Radio. Liquid Net builds on the principles of Nokia Siemens Networks Liquid Radio architecture. It adds Liquid Core and Liquid Transport functionality to the network which can be implemented either separately in multivendor environments or in concert across an operators entire network to bring the full benefits of Liquid Net to bear. It allows an operator to set up its network to self-adapt to meet capacity and coverage requirements based on demand. The new approach also aims to significantly improve the quality of broadband services worldwide. Spectacular broadband growth means networks must be ready to cope with personal data consumption of more than 1GB per mobile user per day. Demand is also highly unpredictable, fluctuating between locations at different times as people use broadband at home, at work and on the move. Abrupt changes in broadband use can also occur when, say, new device software is launched, or updates to popular applications and overthe-top services are released, leaving operators no time to prepare.

Capacity in todays conventional networks is typically frozen in separate places; at individual base station sites, in parts of the core network that manage voice and data services, or in the optical and IP transport networks, says Marc Rouanne, head of Network Systems at Nokia Siemens Networks. Each is a potential bottleneck to someone getting the broadband service they want at a particular moment. Fluctuating, unpredictable demand in one part of the network means huge chunks of capacity can be left idle elsewhere, making poor use of existing investments. For example, as much as 50% of a conventional core networks capacity can be dormant. Instead, Liquid Net unleashes frozen network capacity into a reservoir of resources that can flow to fulfil unpredictable demand, wherever and whenever people use broadband. NSN has created Liquid Net, to free-up unused capacity and allocate it instantly

Where Liquid Radio was about supporting capacity growth and flexibility in the RAN, Liquid Net smartly carries the theme forward to transport and core networks promising an optimisation of not only user traffic but CAPEX investments
across the whole network wherever and whenever it is needed. Liquid Net uses automated, self-adapting broadband optimisation to deliver services and content to ensure the best customer experience by always being aware of the networks operational status and the services being consumed. In addition, Liquid Net channels traffic in the transport network along the path of least resistance and lowest cost between operator sites. NSN claims that not only does Liquid Net help operators to raise customer loyalty, but it also opens up new business opportunities. Where Liquid Radio was about supporting capacity growth and flexibility

in the Radio Access Network (RAN), Liquid Net smartly carries the theme forward to transport and core networks promising an optimisation of not only user traffic but CAPEX investments, said Peter Jarich, Current Analysis, service director for Service Provider Infrastructure. Perhaps most importantly, Liquid Net speaks to a need for solutions rather than point products; while components can be deployed as part of a multi-vendor solution, the combination of Liquid Radio, Liquid Core and Liquid Transport into Liquid Net speaks to holistic thinking around operator concerns and demands, Jarich wrote in NSNs Liquid Net press release. NSN says that Liquid Radio, Liquid Core and Liquid Transport can be implemented together or separately in the network for fluid capacity, coverage and services, and to enable their introduction and management within multi-vendor networks.
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ZTE C-RAN
TE is one vendor that has paid lip service to a Cloud RAN wireless networking solution. Its C-RAN vision, which it says has been introduced by Chinese operator CMCC, is also intended to dramatically lower both capex and opex for operators and greatly reduce power consumption through its new wireless-access network architecture. ZTE said that the solution is expected to lower the TCO (total cost of ownership) of wireless networks by 40%. ZTE said that when it comes to lowering the per-bit data costs - day to day operational costs such as base station sites, data centre and day-to-day operations are often over 60% of the overall cost of operation. Therefore, delivering innovation at the wireless architectural level is more impactful, leading ZTE to propose a new generation of C-RAN solutions.

To this end, ZTE points to its activities in China, where it says it has taken the lead to explore a C-RAN solution together with CMCC, to develop a new generation of wireless access networks through centralised processing, collaborative radio, real-time cloud infrastructure, green wireless access network architecture, and cloud computing. As such, it claims to be the the first company in the industry to realise dynamic baseband sharing, and is actively

Network costs by sector (Source: Alcatel-Lucent)

Based on the case of CMCC ZTE said that the C-RAN architecture could the access network's capex by about 20% and opex by about 63%, reducing the 10-year TCO by about 40%, and reducing the construction cycle by a third
promoting its application by tackling key C-RAN technologies. For example, using Colored Fiber Connection, it says it has solved the problems associated with the consumption of LTE optic fiber resources, completed the Phase I prototype of LTE Advanced CoMP (Coordinated Multippoint), and deployed this with a number of Chinese operators.

ZTEs C-RAN solution realises the separation of the Remote Radio Unit (RRU) and the Baseband Unit (BBU) on the wireless side, and has completed the centralised evolution from base-stations to base-station clusters. On this basis, it can further improve coordination between the stations in a base-station cluster through the upgrade of BBU, and to realise the coordination between the base-station clusters through the interconnection of large-capacity BBUs. The BBU infrastructure can be built using general IT platforms, to realise equipment virtualisation and scheduling ability through cloud computing. It forms part of the continuing and deeper integration between the telecom industry and the IT industry. ZTE says that its trials have demonstrated that C-RAN architecture can realise large-capacity with a small number of nodes, to dramatically reduce capex for operators. Based on the case of CMCC (in which only a small number of new optical cables needed to be deployed, due to the number of pipelines already in use), ZTE said that the C-RAN architecture could the access network's capex by about 20% and opex by about 63%, reducing the 10-year TCO by about 40%, and reducing the construction cycle by a third. It could reduce power consumption by over 80% compared to the traditional macro base-stations.

OTHERS SAMSUNG, NEC AND FEMTO

amsung has announced plans to target LTE network contracts in Europe, basing its hopes on an expanded European presence and on kudos gained from LTE contract wins already made in the USA, Middle East and Asia Pacific. To support its goals, the company is establishing a network equipment operations centre at its European HQ in the UK and aims to have 100 people working out of the centre in two to three years if the company makes good progress contracts.

We are hiring now, said IP Hong Vice President of Marketing at Samsung's Telecom Systems Business. The company is already in trials with one major European operator, Hong said. Although the vendor has little current footprint in European wireless infrastructure, it has won LTE deals in the USA with MetroPCS and Cellular South, with Mobily in the Middle East and will support SK Telecoms commercial launch of LTE in July 2011, according to Hong. Samsung is tying in the launch of its European operations with its Smart LTE

portfolio, an LTE solution that includes features such as intelligent radio resource allocation. Hong added that amongst Samsungs capabilities was a special technology for interference cancellation, that goes beyond current specifications. The company is also marketing its multi-standards base station, with both macro and small cells in its product line. It will include 2G and 3G capabilities within that converged approach, hoping to offer operators flexibility as they swap out ageing equipment for more power and spectrally-efficient designs.

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INSIGHT REPORT

Other vendors are taking an approach that views the HetNet as a step towards the dominance of small cells - not just in terms of total numbers of cells (there are already more femtocells than macro cells) but in terms of traffic handled, and even in terms of how operators view network design. Shraram Niri, of NEC, has long proposed the view that if operators want to get the capacity improvements that LTE is intended to deliver, meaning over 25Mbps, then they will need to design networks almost entirely of small cells. Lets be clear. Hes not talking about designing a network that has mainly macro coverage but with some small cells dropped in where capacity demands are highest. No, hes saying that to get the most out of LTE, operators need to deploy networks that are composed mostly of small cells. So what of the argument that tens of thousands of small cells are too expensive to deploy challenging the backhaul network, and driving up opex? Niri said that SON, interference management, and

ease of location will all mitigate the cost of delivering a multiple-small-cell network. Kenny Graham, Head of LTE and Innovation Solutions at Vodafone Group, said that in his view the basic performance of SON has worked well so far in trials Vodafone has carried out. SON is intended to provide automatic functions as interference management, devicebased neighbour relations, mobility load balancing and Cell-iD collision detection. The basics of SON are proven, Graham said, and now we are moving on to the more advanced features, to extract the actual performance gains that SON can bring, and not just the

The basics of SON are proven, Graham said, and now we are moving on to the more advanced features, to extract the actual performance gains that SON can bring

opex improvements. If femtocell proponents are to have a major role in the LTE network of the future, then their ability to interwork with macro elements will be crucial. Work continues to prove that femto elements will be non-disruptive in terms of performance and management. In the summer of 2011 the latest in a series of plugfests used a real network to test hand-over between femtocells and surrounding base stations, as well as using France Telecoms core network to test femtocell integration. 13 companies participated in interoperability tests conducted between femtocell network gateways, security gateways, management systems femtocell access points and chipsets to verify 3GPPs Iuh interface, as defined in the Release 9 series of specifications. The companies involved were Ablaze Wireless, Alcatel-Lucent, Alpha Networks, Askey Computer, Cisco, Continuous Computing, France Telecom, Huawei Technologies, ip.access, NEC, Node-H, NSN and Picochip.

WIRELESS LAN WIFI 2.0

utside of femtocells and integrated radio approaches, lies a third way carrier WiFi. The introduction of new WiFi standards, designed to support the automatic selection (if desired by the user) of carrierowned or partner WiFi networks raises the proposition of operators using licensed and unlicensed spectrum to onload and offload data traffic, and even in some cases voice calls. The Wireless Broadband Alliance (WBA) and the Wi-Fi Alliance have outlined plans to create commons standards that would enable users to connect automatically to WiFi hotspots using SIM-based authentication and security protocols. The aim is to enable a device to authenticate automatically at a WiFi hotspot, using cellular-based authentication methods such as EAPSIM/AKA and EAP-TLS/TTLS. This could

mean that mobile operators would view WiFi providers as trusted roaming partners, opening up new business relationships and increasing the opportunities for data offload and roaming. The WBA calls the programme the Next Generation Hotspot (NGH) programme, and it is working with a pilot group of operators and technology providers to define interoperability requirements for hotspot and 3G/4G operators. One company aiming to give operators increased flexibility between WiFi and cellular networks, and address backhaul at the same time, is BelAir Networks. BelAir launched its100SP Strand Picocell last year, and has an updated product due as Mobile Europe went to press. The Strand Picocell is designed to sit on the end of cable network infrastructure, allowing operators to take advantage of

cable plants power and locations. BelAir says that the unit can sit on overhead cable, or on residential pedestals, or in cabinets. It can use AC power from the cable plant and use the cable network for backhaul. This addresses the three problems mobile operators have in cell site planning site availability, power and backhaul. Because the cells offer radios covering both licensed and unlicensed spectrum, they could be deployed by mobile operators to offer cell site coverage, but also be used to offload traffic from wireless networks directly over the cable network. The WiFi side of the unit would also enable cable operators to offer wireless access to their own subscribers. Of course, if carrier WiFi does take of, major providers such as Cisco will also address carriers with integrated, policy aware, solutions.
Mobile Europe Insight Report | 31

Pricing innovation

KNOW YOUR CUSTOMER

The mobile operator of 2011 has to think differently about their customer data, and subscriber experience, to deliver pricing strategies that deliver maximum value to the user, but also deliver increased profitability for the operator. Can they square this circle?
he promise of constant connectivity and eversmarter connected devices presents the industry with great opportunities. But service providers are also confronted with the challenge of increasing revenues, managing network congestion and capex expenditure, whilst not irritating customers who have come to believe that data is free and ubiquitous. In order to better monetise their networks and data services, service providers have moved away from unlimited data packages and are looking to implement innovative packages and promotions. For example, the following aspects have been highlighted by Amdocs, as possible routes for operators to take:

G Ability for customers to select packages based on the

type and quality of data service such as the number of films they wish to download in high definition (not just harder-to-understand metrics like size and speed of data download) G Shared data allowance across multiple devices or family data packages with different policies for each family member G More creative promotions based on multiple factors such as customer monetary or lifetime value, usage behaviour and network status at peak and non-peak network times. Another advantage that is often proposed operators hold is competing on service Quality of Experience (QoE). Yet does this really hold true from a customer perspective? Well, mobile operators do indeed have an opportunity to improve customer satisfaction, reduce churn and drive new revenue streams, according to consumer research carried out by YouGov and Acision, outlining a dream vision for those who see quality-based tariffing as a key tool in the operator armoury. The research conducted YouGov questioned UK consumers on the quality of their mobile broadband and data services experience across mobile handsets, smartphones, tablets, laptops and dongle-powered devices. It showed that 77% of users have encountered some form of quality of experience issue using services on mobile broadband with 54% of consumers having experienced slow speeds and 42% having had connection problems. The increasing popularity of time-sensitive, data-heavy applications and services, driven by the soaring adoption of smartphones and feature-rich devices, has not only put pressure on operators networks but means that consumers have higher expectations of the quality of services they receive. However, while service usage is higher, 77% of consumers who use VoIP on their mobile
34 | Mobile Europe

Is the price right? Operators are taking steps to make more personal pricing offers.

phone stated that they have encountered problems with the service, while a further 70% of video users have experienced problems when they access video. For video specifically, stalling was found to be the most frequent and least acceptable issue (60%), followed by having to wait a long time for the video to play (26%). Yet in these apparent negatives, lies opportunity. The research also revealed that only 11% of consumers disagree or strongly disagree with operator intervention to optimise video during periods of congestion and 21% of respondents are even willing to pay to prevent the video from stalling and improve the overall quality. The findings also highlight a strong desire among consumers for more context-aware and personal preference-oriented services. 70% of those questioned stated that they would like to be notified in real-time about network congestion, while another 71% wanted to be notified about large download sizes, which may impact their data usage. Greater tariff flexibility and differentiation also appears to be high on consumers wish-lists, with 26% of video users stating that they would be happy to pay for a service that would enable them to save on their bundle. Nearly three quarters (72%) of respondents, meanwhile, wanted the option to delay application updates to a time when downloads are free. Commenting on the research, Steven van Zanen, SVP Marketing at Acision, says, In order to enhance the end user experience, operators need to define new strategies and take a holistic, 360 quality of experience approach, which takes into consideration a number of key factors such as subscriber type, service characteristics/experience,

Pricing innovation

personal preferences, device and content/context awareness. So are operators in a position to do this? Gordon Rawling, Senior Director of Regional Marketing, Oracle Communications, EMEA, says that there is not an operator who hasnt expressed the objective of having a more dynamic pricing and billing structure. Yet Rawling says that although that desire is there, there are still some barriers to overcome. Chief amongst these are business and some technical issues. For instance, the traditional separation of off/on line, pre/post pay is technically driven, yet in theory doesnt mean a lot to consumers. Its just a way of paying. If I happen to be a post-paid customer, it doesnt mean I wouldnt want to take advantage of a pre-paid service opportunity an operator might want to offer me, Rawling says. As for those business issues, this year the the CMO Council, with sponsorship from Openet, surveyed 212 staff at operators, representing marketing and technology functions. It asked if these professionals thought their own companies were equipped to provide consumer-centric services, and respond to the changes in subscriber demands and increasing complexity. Liz Miller, VP of Programs and Operations at the CMO Council, told Mobile Europe that 75% of those surveyed believe that lack of integration between data sources was hampering the introduction of new, more personalised and relevant services. 72% also thought that poor alignment between sales, marketing and IT was hampering efforts. 68% agreed that a traditional corporate mindset was out of sync with new forms of competition. Additionally, 83% felt they needed to get a better handle on the network resource and support challenges presented by a more diverse and demanding customer base and the proliferation of new devices and service offerings. Miller said, There is a sense that operators are dealing with a legacy mindest that responds to subscriber demands by applying traditional infrastructure, operational and pricing solutions. The aftermath of that is that they do not have enough access to the data they need to drive data-driven customer experiences. There is a sense of paralysis to even start to aggregate that data, that they are faced with this overwhemling wave of customer insights that could be aggregated. Then they try to aggregate that data and

VoIP service, operatorprovided or Over the Top are one example of how user profiles are changing.

There is a sense that operators are dealing with a legacy mindest that responds to subscriber demands by applying traditional infrastructure, operational and pricing solutions

end up with soiled data. The problem is to turn that key data into insights that can be actioned. Operators are looking for new revenue streams and to go beyond the new pricing matrix, beyond these legacy conversations, to deliver personalized, hi touch and more profitable customer experiences. Ari Banerjee, senior analyst, Heavy Reading, identifies one of the key technical barriers operators have been facing - that their existing policy and charging tools are not integrated, and cant provide the required functionality. Our research shows there is global consensus that integration of charging and policy management capabilities is required to monetise these new data pricing strategies. Service providers have found attempts to integrate charging and policy management by their internal IT and network departments challenging and too expensive and are now seeking pre-integrated vendor solutions. Amdocs claims that its research findings reveal that charging subscribers based on the customer experience provided is gaining mindshare, but existing systems are challenged to enable it: Its research, carried out with Heavy Reading, found that marketing departments want to introduce more sophisticated data price plans, with 83% of respondents say their marketing organizations are asking IT to enable innovative data price plan. Over 90% say their companies are looking to create packages across lines of business, customer types and payment methods, while 86% of providers plan to launch tiered pricing plans; and 82% plan to launch single data plans for multiple devices (e.g. tablets, smartphones, etc.). To roll out these services, Amdocs says that integrated charging and policy management capabilities are required to enable these more sophisticated data price plans Amdocs says that IT organizations find it difficult to deliver, as 80 percent of respondents do not think their existing policy management systems, deployed to support network-related use cases (bandwidth management, fair usage, bill shock) can support more advanced use cases, such as data plans across multiple lines of business, payment methods and spend limits, and more. 10 percent have tried to integrate charging and policy management systems and failed. This survey validates the need for better integrated charging and policy management capabilities in order for service providers to create, offer and monetize the next generation of data services, says Rebecca Prudhomme, vice president of product and solutions marketing at
Mobile Europe | 35

Pricing innovation
analysis of the impacts of certain tariffs within specific customer segments and benchmark that against other tariffs. All operators are looking at how they can drive an increased understanding of the interaction between complex tariff bundles and the profitability of a subsegment. When we run reports we not only allow our customers to understand how profitable segments are but also how that compares to all other tariffs from their competitors in that market. That means you can say not only if a tariff is likely to be good for you as a business, but you can use it to differentiate, and be sure you have a chance to be successful in a segment, Skoczkowski says. Redknees customer Telefonica is also using Sandvine's Policy Traffic Switch to collect network data and present that to executive management functions to help them to make business decisions and to enforce new policies in the network. As a global company, Telefnicas network insight and business intelligence is key to understanding how we can better serve our vast subscriber base worldwide, says Vicente San Miguel, CTO, Telefnica Corporate. At one subsidiary, Telefnica recently introduced a menu of tiered pricing plans that accommodate subscribers personalised network usage patterns and budgets. Under this model, subscribers can choose from plans that range from a basic email or social networking plan, to more comprehensive plans that also cover real-time entertainment usage. Operators have the tools to make this happen. Companies like Allot who offer application, device and subscriber awareness enable operators to distinguish between applications such video or VoIP or devices such as an Android or iPhone. Subscriber awareness is used in conjunction with application awareness to implement intelligent charging models and policies per subscriber. The ability to service subscribers according to their data usage patterns is especially useful for marketing valueadded services like unlimited social network plans. Good practices in the industry don't always have to focus on premium plans, though. In fact, Telefonica in Latin America offers a variation of a reduced Internet plan. Within the reduced plan, subscribers can pay for just what they use, which is often basic email, chat, and Web surfing. A variation may be a Social Networking package with usage-based pricing for social networking apps like Facebook and Twitter. However, if a subscriber wants a premium service and is educated about the price points associated with the services that matter most to them then this is what should be considered best practice. Allot Communications told Mobile Europe that it believes that within the next 12-24 months operators will move quickly to value-based pricing, enabled by solutions

Application-based charging solution flow

Amdocs. But we must remember that customers also want to get their new services in a simple and intuitive manner. This is exactly Bandwidth on demand where value-based pricing should come into play. For turbo boost solution flow. example, a movie package that has data and speed (Both use cases from Allot prerequisites already embedded into it for a high-quality Communications) experience will offer end customers the personalised service for which they are willing to pay more. Acisions Van Zanen echoes the theme. In order to maintain a sustainable competitive edge, operators need to evolve from a purely technology-driven approach to a more customer-centric approach and gain control of all aspects of the service. Operators have the opportunity to lead the market on service differentiation, transparency and accountability, by offering clarity on service quality and insight into network performance, he says. Certainly, there is evidence that some operators are taking a more scientific approach to analysing the offers that they make to their customers. Explaining a rising interest in detailed customer analysis, such as that performed by Redknees Price Simulator package, Lucas Skoczkowski, Redknee CEO says, Operators are looking to drive a lot higher efficiency, and more understanding, of how to best tailor their businesses to extract more value from each of their customer segments: so precision becomes much more important. Historically there has been sufficient room in the market so that precision wasnt necessarily the operating word. That has changed, however, and operators are under greater pressure to identify new customer segments, and address those with the most efficient and profitable tariffs and bundles. What we are looking for is agility but with more precision. Sometimes you can create something speedily but lack the precision to ensure you get the result the CFO of the company expects. With operators seeing What we are looking for is agility but increased competition for with more precision. Sometimes you can certain demographic create speedily but lack the precision to segments, there is more motivation to provide ensure you get the result you expect detailed forecasts and
36 | Mobile Europe

Mobile money

MOBILE MONEY
Operator-led mobile money and payments services are still thin on the ground, but momentum is growing across Europe, as operators move to commercialisation of NFC technology. So where can we look to for operator-led market momentum?
the first NFC Android mobile sold in Europe, according to the operator. The phone will be the fourth mobile available from Orange for customers of Cityzi, Orange's brand for mobile NFC services in France. Orange said this device version has been developed by the teams from Orange and Samsung in line with the specifications mapped out by the French mobile contactless association (AFSCM) and relevant international standards. The launch will, the operator claimed, make Orange is the first operator in Europe to offer a SIM-based NFC Android mobile using the SIM card to guarantee the security of contactless mobile services. Orange has already committed to rolling out NFC-enabled secure SIM cards nationally, and has also previously stated that the Group is working with equipment manufacturers to ensure that more than half of the new smartphone models are compatible with the contactless services. Orange has been marketing Cityzi mobiles throughout France since February 2011, making it one of the world's first mobile NFC offers on this scale. It claims to have attracted more than 150,000 Orange customers for services that include passes for local transport, payment in over 1000 partner shops, loyalty, couponing and tag reading. Orange said that the Galaxy launch confirms its ambition to offer an extensive range of Cityzi mobiles, to enable as many of its customers as possible to benefit from contactless services across France. The existing device range includes the Samsung Player City and Wave 578. Orange has said it will extend the CityZi mobile contactless service, currently being piloted in Nice, across the country in 2011. The operator has been marketing the "Player One Cityzi handset across France from January. It has a target of "at least" 500,000 French customers with compatible devices by the end of the calendar year. The operator is also pushing for NFC-enabled SIMs to be made available in all its markets across Europe by the second half of 2011. The Group is also working with manufacturers to ensure that over half of the new smartphone models it buys will be compatible with contactless services when combined with the new, secure SIM card. The Nice pilot involved Orange as well as France's other two major operators, SFR and Bouyges, as well as NRJ mobile and other service providers.

ome 20 countries are expected to launch NFC services in the next 18 months, resulting in transactions approaching $50 billion worldwide by 2014, according to a report from Juniper Research. Following on from the Orange Mobile Payments service launch in the UK, 2012 is expected to be a banner year for NFC service rollouts, Juniper said, with prospects for NFC having improved markedly in the last half year. According to Senior Analyst David Snow, Our view is that the next 18 months will see launches in up to 20 countries. As a result Juniper is forecasting that North America and Western Europe together will exceed the Far East region in under three years based on transaction value. Its tempting to see this as all good news for mobile operators, as if NFC services and payments will necessarily gravitate to a model that sees mobile operators as the chief distributors of the devices and SIMs that make the service possible. Certainly Nav Bains, who leads the NFC service programme at the GSMA is positive. The days for pilots are now over, he said. NFC is now going to market properly, and we will see increasing numbers of commercial launches of NFC, with a lot more operators making commercial SIMbased NFC moves. Bains cant share where he thinks these launches will come from, as it is commercially sensitive, but he is clear that there will be significant progress over the next year. So where can we look to for operator-led NFC mobile payments initiatives?

UNITED KINGDOM FRANCE

Orange has said that it will sell a contactless-enabled version of the Samsung Galaxy S II from October, making it
38 | Mobile Europe

Staying with Orange, in the UK it has announced that it is launching an NFC-based retail payment service called Quick Tap - intially launched with

Mobile money

PAYPAL, PAYTHRU AND OPERATORS

The threat to mobile operators in mobile payments comes from what are termed Over The Top players. If rival services take off, the operator vision of a renting out space to service providers on a SIM containing the Secure Element becomes redundant. And the world is not short of rival payment technologies - some of which are aimed at tieing in-store purchasing to mobile. PayPal recently unveiled a clutch of mobile payment initiatives for shoppers - but one that doesn't require near-field communication (NFC) technology inside smartphones. The system relies instead on the scanning o bar codes, and the use of PINs and phone numbers to authorise payments through PayPal mobile accounts. PayPal President Scott Thompson said, pointedly, in a blog post: "Let's be clear about something, we're not just shoving a credit card on a phone," Another company that eschews waiting for NFC terminals, handsets and business models to work themselves into the market is Paythru, a company that takes Paypal-like approach in avoiding NFC, and the operator element in authenticating and clearing payment. Keith Brown, CEO of Paythru, told Mobile Europe that he wasnt sure what value operators add to the NFC value chain. I dont know, thats my big problem with it. Theres a battle for ownership of the customer, for carriers to stop being dumb pipes. To try to get a wallet for their customers is an attempt to get a part of the value chain. Yet in financial services, who does the customer think they have a relationship with?

Google Wallet launched to fanfare in the USA - with Spring, Citi, Visa and Mastercard as partners. Google said it would welcome more operator involvement in its wallet service as it rolls out the service across different markets.

another Samsung handset, the Toco. O2 is not so far behind. It has announced the technical and service partners it would be working with to deliver a mobile money service later this year, with O2's parent Telefonica probably the most aggressive group operator in the NFC space, outside of Orange. Orange UK customers in the service are able to pay for items up to 15 without entering a PIN, using a Samsung Tocco Quick Tap handset available on Pay As You Go for 59.99, and from free on Pay Monthly contracts from 10 per month on 24 month contracts. The operator has since added the Samsung Wave 578, which will work in accordance with a Barclaycard, Barclays debit or Orange credit The JV, controversial because it excludes card. Customers can load UK, would bring together the operators' up to 100 on the wallet. Gemalto is acting as development efforts in NFC the Trusted Service

Manager, which includes the supply of NFC-enabled SIMs, containing the secure element, to Orange. Orange said the NFC phones can be used at 50,000 stores, mainly at branches of Pret a Manger, EAT, Little Chef, Subway, Wilkinson and McDonalds that already have contactless payments terminals. The company said 12.9 million contactless credit and debit cards are already in circulation, of which over 11.4m have been issued by Barclaycard. O2 confirmed that it too will launch a mobile money and payments service - under the O2 Money brand - after it discontinued current operations in its O2 Money service. Due to relaunch in the second half of 2011, but not visible as Mobile EUrope went to press, O2's service seems to go further than Orange's payments solution. Capabilities planned for the wallet include m-commerce, airtime top ups, contactless/NFC payments and peer-to-peer payments. The operator will also add NFC capabilities to its existing O2 Money Visa pre-paid card service. O2 said that its commercial and technical partners for its service would be Wave Crest, FIS, Intelligent Environments and Visa Europe. Wave Crest will provide and operate the core banking platform upon which the new prepaid card and mobile wallet services will run. Wave Crest will also manage the security and online customer experience. FIS will provide transaction processing and UK-based customer service for both the prepaid cards and mobile wallet. Intelligent Environments has been appointed to develop the wallet application and Visa Europe will be the payment network for the wallet and new prepaid products. Everything Everywhere, Telefonica UK and Vodafone UK are also working on the creation of a joint venture before the end of the year that will act as a single point of contact for marketers, banks, retailers and anyone else that wants to create a mobile commerce service. The JV, controversial because it excludes 3 UK, would bring together the operators' development efforts in NFC, for payments and other services, as well as provide a single contact point for advertisers, media agencies and retailers looking to reach consumers on their mobile phones. The JV will enable brands and service providers to book advertising space and create campaigns as well as provide offers, coupons and loyalty cards which can be stored on the phone and redeemed in shops.
Mobile Europe | 39

Mobile money
The operators said that they would continue to compete, but base their services on "the open platform infrastructure provided by the JV". taking part in the test, which is a cooperation between Telenor, DnB NOR, MasterCard, Teller, Nets and Giesecke and Devrient. The test project is part of a NFC City, a user driven research project which is partly financed by the research council of Norway. The customer will be able to pay by holding their mobile up to the payment terminal at the till. Payment will be faster than and just as secure as paying by card. The money will be debited from the customer's MasterCard. Everybody taking part in the test will be using a Samsung mobile with built-in NFC technology and an adapted SIM card. Most producers of smart phones will include this technology in the time to come. The Oslo test is one of the first in Scandinavia and will be an important milestone towards our use of mobile phones as wallets. We are certain that contactless payment via mobile will become extremely widespread, because we all take our mobiles everywhere we go, and because it's a secure and easy way to pay, says Jon Fredrik Baksaas, President and CEO in Telenor.

SPAIN
Trials continue. One thousand employees on a Telefonica campus in Madrid will use mobile NFC services during their working lives, as Telefonica continues to promote NFC usage. Telefonica said that employees at its District C site (to be renamed District NFC) campus would be given Samsung NFC phones and would be able to use them to gain access to the site and pay for food on campus. in time the number of participants in the project will be increased to include all 14,000 employees on site. Partners in the project include Autogrill,Bankinter, BBVA, G&D, La Caixa, Oberthur, Samsung, Sermepa and Visa. A bigger trial in Spain, an NFC trial in Sitges, has now ended. Telefonica said that its Mobile Shopping Sitges 2010 trial had resulted in customers carrying out 30% more e-transactions, with a 23% increase in average purchase per user with their card.

POLAND
Gemalto, specialist in digital security, has announced that PTK Centertel, an Orange group affiliate, is deploying the largest NFC program in Poland, with a commercial offer targeting several thousand users. Gemaltos already plays an active role in Orange Groups NFC expansion strategy with deployments already in the UK, France (see above) and now Poland. Gemalto provided an end-to-end solution that includes NFC software and user interface applications securely embedded on an NFC SIM, and the Trusted Service Management (TSM) services. PTK Centertel and its partnering bank have entrusted Gemalto with the operation of the TSM platform, to securely personalise and manage the payment application in the device over the air. Krzysztof Sieczkowski, Product and Content Development Director, PTK Centertel, said, We need a complete solution to speed up our time-to-market, and leverage the strong contactless payment network already existing in Poland to make our consumer the first to benefit from the NFC experience.

The level of confusion about who does what in this market was reflected by the warm response to this infographic from mobilepaymentstoday. You can see the full infographic at mobilepaymentstoday.com

TURKEY
Turkcell has announced the official launch of the T20 smartphone, one of the world's first commercially available UICC ("Universal Integrated Circuit Card"), NFC - SWP ("Single Wire Protocol") Android-based device. Turkcell T20 allows consumers to use their phone as a mobile wallet, using MasterCard's contactless technology, the PayPass scheme. The aim of Turkcell Cep-T Czdan, a mobile wallet service from Turkcell, which is already loaded on the Turkcell T20 and communicates with an NFC enabled sim card, is also to provide a comprehensive end-to-end NFC platform open to all service providers and banks. As part of this platform, Turkcell TSM (Trusted Service Manager) was developed and Turkcell became the first telecom operator in Europe to launch an approved TSM solution by MasterCard. Turkcell, working with MasterCard, is the first mobile operator in the world that presents more than one bank application in Cep-T Czdan.

Samsungs Galaxy S II, now available for NFC service use in France through Orange.

NORWAY
Around 250 of Telenor's and DnB NOR's customers will be testing the option of paying via mobile over the coming months. A dozen locations in Oslo are taking part in the test. Shops from the Kaffebrenneriet, Vita and Deli de Luca chains are
40 | Mobile Europe

Diary & Notes

conference highlights
LTE DEPLOYMENT STRATEGIES
08 - 11 November, London Justify the business case for LTE and learn how to overcome the challenges of deploying an LTE network that optimises the customer experience. Now is the time to look to LTE to unlock new opportunities and maximise customer satisfaction.To find out how, join fellow LTE experts from across Europe and The Middle East. www.ltedeploymentstrategies.com

HPS BUSINESS SCHOOL WIKI

BRO ADBAND TRAFFIC MANAG EMENT 2 0 1 1

15-17 November, London 100 speakers, including 60 operator speakers, address how carriers can profit from the data explosion. Topics include turning traffic related insights into actionable service propositions, the current regulatory position on traffic management and net neutralit, the signalling challenge, the actions required to integrate traffic management into OSS/BSS architectures. www.broadbandtrafficevent.com

DIGITAL ECONOMICS EXECUTIVE BRAINSTORM & DEVELOPER FORUM EMEA

9-10 November, London New Digital Economics brings together five events in one venue, colocating the Telco 2.0, M-Commerce, 2.0 Cloud 2.0, M2M 2.0 and and Digital Entertainment 2.0. It focuses on new growth opportunities at the intersection of Telecoms, Media and Technology. www.newdigitaleconomics.com

MVNO NETW O RKING CO NG RESS

22 - 24 November, Paris MVNOs, MNOs, MVNAs, and MVNEs meet to explore the greatest obstacles to increasing MVNO market share and maximising wealth generating opportunities for both the MVNO and MNO. www.dataoffloading.com

SPECTRUM MANAGEMENT FORUM

14 - 16 November 2011, Paris Regulators strive to meet the Commissions 2013 deadline for the Digital Agenda, while operators are vying for must have spectrum licences.With both operator and regulator perspectives, the Forum will cover the latest developments in the sale and acquisition of spectrum, from evaluation of options through to bidding strategies. www.iir-telecoms.com/event/spectrum

DATA O FFLO ADING STRATEG IES 2 0 1 1

05 - 08 December, 2011, Barcelona Finding the best offloading strategies and techniques that provide both optimal customer experience and the best ROI is the key challenge for operators. Explore the key areas of focus for operators as they look to cost-effectively expand network coverage and capacity. www.dataoffloading.com

Around the mobile world in 300 words

When they write the text books, or cloud-based resource Wikis, for the business schools of the future, HPs past few months and weeks will surely feature. What is the role of a board? Is it to investigate allegations against a CEO, find him innocent, but send him packing for a separate offence? Is it to then allow the new CEO to negotiate and approve the second largest acquisition price ever for a software company, and to close down your biggest operating unit by revenue, exposing the company to an extended period of market uncertainty? Then, once you have achieved this, is your role then to dismiss the same CEO, moments after he has begun executing on a strategy of which you must have approved only a few weeks prior? All of these allegations could be made against HPs board, who investigated Mark Hurd last year over charges of sexual harrassment, and fired him for expenses irregularities; who presided over CEO Leo Apothekers plan to dispose of the personal computing division, including the WebOS software the company had just bought under the previoud CEO; who then got rid of Apotheker when it appeared that his idea to become purely a software company, bouyed by a very expensive acquisition of Autonomy, wasnt a popular one.

That Oracle then rubbed salt in the wounds by suggesting that Autonomy had made itself available to Oracle, at a lower price than HP paid, but still a price Oracle found too much, will surely be added to the HP Business School Wiki. Autonomys CEO denied this, then was reminded of the time and date he met Oracle. Then he said that meeting wasnt about a sale, whereupon Oracle said they had his powerpoint slides of the meeting, very financial in nature. The case, as court reporters say, continues. Speaking of courts...perhaps HPs decision to shut WebOS will save it from being caught up in the damaging and high stakes spate of litigation in the mobile device market. Chief agitants, lining up in courtrooms across the world, are Samsung and Apple. But they are by no means the only companies going down the legal route. The trend for suing for breach of IP reached such heights that as Amazon released its Kindle Fire, one of the first questions being asked on Twitter was, whos going to sue them first?

42 | Mobile Europe

Why VoLTE and Why Now?

November 2nd 2011 2pm-3pm GMT

Host:

LTE promises greatly accelerated data rates even when mobile users are travelling at hundreds of kilometers per hour. However, as LTE moves from the labs into actual deployments, debates over the glaring gap in delivering voice

Keith Dyer,
Editor, Mobile Europe

over an LTE network are growing. Voice is the major revenue generator for operators, and voice-over-LTE (VoLTE) is now being touted as the technology of choice for delivering voice to LTE networks.

EXFO Presenters:

In this webinar EXFOs LTE experts will examine the benefits of VoLTE, and the challenges (both pre-deployment and postMurat Bilgic,
Director of Wireless Technology, CTO Office

deployment) faced by manufacturers and operators developing and deploying VoLTE networks.

Join us on 2 November to learn more about: Why VoLTE and why now? I How operators can guarantee call quality that meets and exceeds expectations of end-users
Uvaiz Ahmed,
Wireless Product Line Manager

I The challenges of interoperating with legacy networks (UMTS, GSM, CDMA, etc.) I The co-existence of data and voice over a shared network I Monitoring, troubleshooting and analyzing a deployed VoLTE network

Wayne Davis,
Service Assurance Product Manager

Please join EXFOs team of experts on 2 November, 2011 to learn everything you need to know about VoLTE.

Visit this URL to REGISTER: https://www1.gotomeeting.com/register/321108553 Email: Shahid.ramzan@mobileeurope.co.uk Tel: +44207 933 8980