Issue 2008/2014

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One goal 28 paths

Hartwig Tauber, Director General, FTTH Council Europe

FTTH in Europe

Mobile changes footballVivo:

Hong Kong to Frankfurt in 88ms

MegaFon’s DREAM

The rise of

VIVA Kuwait

Voices from Industry

We all want the option to connect anytime, anywhere. And when we choose to connect, we want zero wait-time. Does this sound like a dream? Technology has a long history of making our dreams come true. If anything has changed, it’s that advancements now routinely surpass even our wildest dreams.

One example is the instant messaging app FireChat, created by U.S. app developer Open Garden. Unlike other instant messengers, FireChat allows users to chat with one another without relying on a wired/wireless network. It transforms smartphones and other devices into “routers” to build cellular networks using Bluetooth or Wi-Fi, delivering Internet-style communication, without the Internet.

In some places, FireChat has caught on like wildfire; Open Garden’s CEO has pointed out that it quickly became the top ranked app in 15 countries. “Chat without the Internet” truly sounds disruptive; some see it as the successor of instant messaging apps like Skype and WeChat. There are even those who believe that, for telcos, the end is near. But I’m not convinced.

While amazing, Open Garden’s new interconnection technology is only especially useful in very specific scenarios, such as when network coverage is weak or absent. In ordinary conditions, the guaranteed quality of service (QoS) offered by telecoms will remain absolutely irreplaceable.

The ultimate purpose of network communication is reliable, ubiquitous, anytime-anywhere connection – and it’s got to be fast. Innovative applications based on smartphones and mobile Internet are important, but they can’t replace the backbone of the Internet or the essential services provided by carriers. A Better Connected World requires intelligent networks that provide a higher order of reliability and unthinkable speeds.

The EU commission has set a clear goal in its European Digital Agenda. By 2020, half of all EU families will be able to enjoy 100 Mbit/s broadband, which will greatly promote the mass popularization of medical and security services and applications. Across Europe, optical fiber networks are being deployed on a massive scale. MegaFon is currently constructing its DREAM network across 8700km of Eurasia, with a transmission capacity of 8Tbps and QoS assurances along the entire route. At the same time, LTE deployment in China is in full swing.

ICT is the cornerstone of industry transformation. Breakthroughs in key technologies will expedite broadband ubiquity. For instance, a research group at the Technical University of Denmark recently developed a new type of optical cable capable of transmitting at 43Tbps using a single fiber and a single laser. At such speeds, you could download all the movies in the world in the time it would take to watch just one. Driven by incredible technologies like these, a Better Connected World is taking shape.

Speed x Ubiquity

Sponsor Huawei Technologies Co., Ltd.

Publisher Huawei COMMUNICATE Editorial Board

Consultants Eric Xu, Ken Hu, Guo Ping

Ryan Ding, William Xu, Heymans Zhu

Editor-in-Chief Sally Gao (sally@huawei.com)

Editors Joyce Fan, Julia Yao, Jason Patterson

Morgan Hatrick, Linda Xu, Xue Hua, Cao Zhihui

Pan Tao, Chen Yuhong, Zhou Shumin

ContributorsJoy Tan, Ge Qiang, Li Xiaolin, Felix Kamer

Jorge Keith Alves Wada, Wang Yuxiang

Xiaojing Highfield, Madina Mendygarina

Yan Xuguang, Zeng Dewen, Liu Ping, Zhou Jing

E-mail: HWtech@huawei.comTel: +86 755 28786665, 28787643

Fax: +86 755 28788811

Address: B1, Huawei Industrial Base,

Bantian, Longgang, Shenzhen 518129, China

Publication Registration No.: Yue B No.10148

Copyright © Huawei Technologies Co., Ltd. 2014. All rights reserved.No part of this document may be reproduced or transmitted in any form or by any means without prior written consent of Huawei Technologies Co., Ltd.

DisclaimerThe contents of this document are for information purpose only, and provided “as is”. Except as required by applicable laws, no warranties of any kind, either express or implied, including but not limited to, the implied warranties of merchantability and fitness for a particular purpose, are made in relation to contents of this document. To the maximum extent permitted by applicable law, in no case shall Huawei Technologies Co., Ltd be liable for any special, incidental, indirect, or consequential damages, or lost profits, business, revenue, data, goodwill or anticipated savings arising out of or in connection with any use of this document.

Sally Gao, Editor-in-Chief

For electronic version and subscription, please visit www.huawei.com/winwin

Hear what operators want to share in person,see how peers succeed in a fierce marketplace, and delve into their secrets to success. At WinWin, it’s all about success.

WHAT’S INSIDE

Vivo: Mobile changes football09

The 2014 FIFA World Cup was a high-water mark for Brazilian football mania, with the lucky fans onsite sharing the cheer online, and roughly half a million visitors joining in. Vivo, Brazil’s largest mobile operator, made a tremendous commitment to ensuring this experience. Andrea Folgueiras, its CTO, has details.

08/2014Issue 20

Voices from Industry

FTTH in Europe: One goal, 28 paths01

The FTTH Council Europe predicts that in the next five years the number of FTTH/FTTB connections in Europewill double from 2013 levels. Applications and services have been developed from e-health to online gaming. Hartwig Tauber, Director General of the FTTH Council Europe, shows us the big picture.

FTTx gains a foothold06

Fiber is a must in the era of fixed-mobile convergence. Arief Musta’in, Head of Broadband Division, Telkom Indonesia, Markus Reber, Head of Rollout and Access, Swisscom, and Cenk Serdar, Senior Vice President of the Consumer Unit, STC, share insights about fiber’s future.

The antenna: Pinnacle of Zain Kuwait’s LTE network

53

China Mobile Jiangsu: A role model in user experience

61

Agile networks: Ready for the future22

Costs of deploying FTTdP with G.fast39

The rise of VIVA Kuwait57

Winners

MegaFon DREAM: HK to Frankfurt in 88ms

41

Mobile Money: Making it work45Building tomorrow’s digital infrastructure27

21st century communication is creating major challenges for telcos. To balance the the needs of the future with the pressures of today, telcos need agreement on regulatory and industrial policies that encourage infrastructure investment, reduction in network TCO, and a new level of industry collaboration where infrastructure is shared.

Tao of Business

We are living in a mobile broadband (MBB) era where incremental advancements continuously offer us more. New smart terminals and apps constantly spring up, attracting an increasing number of MBB users and generating big data.

UMTS: A well that never runs dry36

Cooperative players are the fittest33

The digital divide: The way forward29

Envision a Better Connected World13

As the physical and digital worlds continue to converge, ICT has become the engine that propels our world, having a profound impact on our daily lives. Expectations from ICT infrastructure will only rise, and there are key strategic planning issues that we must consider today as we prepare for a sustainable and ever-changing future.

Perspectives

Ooredoo Maldives: Mobile changes tourism

49

IoT: Driving endless possibilities18

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— Hartwig Tauber, Director General, FTTH Council Europe

When public money is invested, there must be a future-proof solution, which is FTTH, when it comes to bandwidth capacity, speed, security and scalability.

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One goal, 28 pathsDespite the region’s ongoing financial difficulties, the FTTH Council Europe predicts that in the next five years the number of fiber-to-the-home/building (FTTH/FTTB) connections in Europe will double from the 2013 figure of 77.8 million. Groundbreaking applications and services have been developed across a wide range of fields, from e-health to online gaming. Hartwig Tauber, Director General of the FTTH Council Europe, answered our questions about the big picture.Scan for mobile reading

VOICESFROM INDUSTRY

By Linda Xu

FTTH in Europe

Ambitious goals

WinWin: The Digital Agenda for Europe has set a clear target that by 2020, half of European households should enjoy ultra-broadband connections of 100Mbps or greater. Such a high penetration would require almost ubiquitous availability. How can FTTH be leveraged to deliver those services?

Hartwig Tauber: The targets concerning broadband entail universal availability of fast broadband at speeds of 30Mbps or more, and at least 50% takeup of ultra-high-speed broadband services of at least 100Mbps. Some

European national governments have allocated funding to help meet these targets, particularly for rural and low-income areas where it is less attractive for private players to deploy new broadband infrastructure, but when public money is invested, there must be a future-proof solution, which is FTTH. The FTTH Council believes that FTTH is the key to developing a sustainable future, as it is now widely acknowledged that it is the future-proof technology when it comes to bandwidth, capacity, speed, security and scalability.

What does 100Mbps mean for end users? A 100Mbps connection, over ten times the average broadband speed in most European countries, would make it possible

AUG 20143 4

to download an entire music album in five seconds, a television show in 30 seconds and a high-definition movie in just seven minutes. However, only 2% of Internet users in Europe are currently able to enjoy such ultra-high speed. The 100Mbps connection speed should be defined as not only the downlink speed but also the uplink. Such ultra-fast broadband speed over FTTH enables services and applications such as healthcare and security which require ultra-high quality and reliability to work better, on a massive scale.

The European FTTH market is still playing catch-up with the two leading regional markets. By the end of 2013, total FTTH/B subscribers exceeded 10 million in North America and over 80 million in the Asia-Pacific, compared with 28 European countries’ 7.8 million subscribers in total. That’s why the FTTH Council Europe believes that we really need to make decisions now to strive towards fiber rollout more aggressively. Otherwise, we will lag far behind.

Patchy growth in Europe

WinWin: Fiber strategies across Europe are diverse; how do you see the deployment of FTTH progressing?

Tauber: There is not a single European market. Take the European Union as an example and you have 28 markets. The outside world is normally under the illusion that once the European Commission makes a proposal, you have a fully-regulated European market. However, each of the markets has a specific history and specific way for how liberalization of the market is implemented. It has different segmentations. We have markets that have invested in mobile for a long time, like Austria. Others have done strong investment in the fixed lines, such as the Nordics. That’s why the FTTH Council Europe thinks that there should be a very positive framework for broadband and fiber investment.

According to our latest released statistics, there was a total of around 320 FTTH/B projects in EU39 countries, including CIS countries, by the end of 2013. Lithuania, Latvia and Andorra all take the first leading place of FTTH/B coverage with 100% and Portugal enjoys the second (67%). Both Turkey and Spain witnessed the highest growth rates. Russia has been the largest market in terms of the absolute number for two consecutive years via considerable subscriber growth (over 1,4 million), followed by Turkey, France and Spain. However, the traditional economic jumbos such as France and Italy languish at the bottom of the ranking. Germany and the U.K. are still missing from the ranking.

In order to further drive the FTTH rollout, there should be some understandings on the policy side. We desperately need regulatory certainty from policymakers so that we can stick to our fiber deployment plan. If operators invest in fiber, their funding should be secured for the long-term, and the market can grow more prosperously. Now, we have the Nordic countries that are dedicated to fiber even in rural areas.

WinWin: Over the last six years, approximately EUR17 billion has been committed to fixed networks annually. That’s a lot of money; how can telcos guarantee reasonable ROI? Can you give us an example?

Tauber: EUR17 billion sounds huge, but if you compare it with how many kilometers of highway you can build with EUR17 billion, you realize that it is not much. Investment in broadband infrastructure is much lower than in many other forms of infrastructure. Every year, there is EUR24 billion invested in fixed and mobile networks. Operators claim they have done a lot of new construction, so the question is whether the real investment is used in upgrading networks or just maintaining the existing ones.

Here comes a successful example. Stokab, a municipally-owned passive fiber infrastructure provider in the city of

The European FTTH market is still playing catch-up. By the end of 2013, total FTTH/B subscribers exceeded 10 million in North America and over 80 million in

Asia-Pacific, compared with 28 European countries’ 7.8 million subscribers.

VOICESFROM INDUSTRY

AUG 20143 4

Stockholm, was estimated to have garnered economic gains of at least EUR1.9 billion. For nearly 20 years, Stokab invested and expanded open, competitively-neutral fiber connections for all. It is seen as a model of municipal fiber deployment with virtually no public subsidies, and has led to competition in the delivery of telecom services in Stockholm. Telecom operators can lease and design their own fiber networks without having to make costly investments or lease from a competitor. Today, leasing fiber in Stockholm costs less than half (sometimes much less) than in other capitals around the world. This means lower costs not only for operators but also for all enterprises that have a need for fast and reliable communications.

Lower costs have also driven adoption of new superfast broadband services like healthcare in the city and have helped the city administration reap significant benefits, thanks to its e-government services. As a result, Stockholm now boasts the world’s largest and most well-known open city network for broadband communications. Over 90% of the city’s households are connected and essentially 100% of the companies. It took Stokab more than five years to generate positive cash flow.

WinWin: What factors have restricted the growth of the FTTH market in Europe?

Tauber: Our current problem is that many of the incumbents owned by shareholders are not interested in long-term development. They want to see high dividends and high shares instantly. As such, the FTTH Council Europe established a special taskforce for investors two years ago. We bring typical institutional investors together who already have invested for the long-term to share experiences and explore business models. Today, typical incumbents have a vertically-integrated approach. The incumbents are not just building fiber networks; they have everything from fiber service to operational offerings. For them, the lowest layer (the physical infrastructure)

cannot lose value immediately and can be used for many years. That’s where they want to invest. Fortunately, some incumbent operators have already taken steps for fiber rollout. For instance, Portugal Telecom is in the forefront of fiber deployment, having already covered 46% of the country’s population.

Most of the markets just concentrate on the incumbent operators. But when we look at the Nordic market, the big fiber players are not the incumbents but the neutral fiber players such as Stokab and utility companies, because they more easily make the long-term investments. In many cases, if the incumbents would like to invest in fiber, there should be a positive environment on the political side. Incumbents in one country find fiber is not an option in their home country, as it is too expensive. In another country, their subsidiary builds fiber networks extensively. The typical example is Deutsche Telekom. In Germany, they are in the slow lane of fiber adoption, while its subsidiaries in Macedonia and Hungary have

Our current problem is that many of the incumbents owned by shareholders are not interested in long-term development.

They want to see high dividends and high shares instantly.

AUG 20145 6

deployed a lot of fiber. In summary, incumbents can’t be the only ones building fiber. We need to understand how incumbents can adopt fiber in a way they need in different environments, because they need to have shareholders’ investments on their sides.

You can’t have one without the other

WinWin: Huawei envisions a world enabled by ubiquitous broadband, and some believe that mobile access will be the dominant factor. What is your take on that?

Tauber: We love mobile, because mobile is part of our life and we always use smartphones and tablets. We don’t see real competition between mobile and fixed lines. The more mobile you use, the more fiber you need. If you really want to build LTE networks anywhere, delivering 100Mbps to the end users, you need base stations everywhere connected to fiber. Besides, at home, you will not connect your 4K TV set or PlayStation 3 to a mobile connection. Even at home, most people are starting to build their own wireless networks with wireless routers. This only works if the fixed network to their home is fast enough. As in my case, when my daughter, my son and I start to use tablets and watch something streamed, the whole network breaks down if I don’t have a decent connection, so it is really a complementary relationship. Mobile and fixed networks are equally important.

WinWin: How do you see FTTH development over the next five years?

Tauber: I’ll start with the buzzwords, such as e-learning

or e-health. We have talked about them for 20 or 25 years. They didn’t really takeoff, because the network quality was too poor. Now with fiber networks, e-care robots that can help elderly people stay at home longer as they can get remote support through them. Similar experiences also happen in many other services. If you look back through the last ten years at what we had with broadband service, there wasn’t YouTube, Facebook, or Instagram available, where we could upload our videos or movies. Now, we have completely different ways of using broadband. We talk about infrastructure like smart cities, smart regions, and autonomous car driving. People will see all these enabled with wireless connection. But how do you see the offloading of wireless traffic? You need fiber again. You need fiber everywhere.

One future service that will definitely drive high traffic is the new 4K ultra-high definition content. I was at the Consumer Electronics Show in Las Vegas this year and made a quick calculation on the spot. If I need to download an 80GB ultra-high definition film, I need to wait for three days with DSL connection; it is not on-demand at all. With fiber networks, the experience will be greatly enhanced.

Currently, there are several markets moving forward, including the Nordics, Spain and Portugal. We believe that we will be successful in convincing the decision-makers. It’s important for Europe to decide the right solution and like our President said, “Do it once, do it right.” Then we will accelerate fiber rollout. Everybody knows fiber rollout is a protracted process, including the decision phase, preparation phase and implementation phase. Only when you get to the construction stage does the rollout really get started.

VOICESFROM INDUSTRY

Editor: Jason jason.patterson@huawei.com

We don’t see real competition between mobile and fixed lines. The more mobile you use, the more fiber you need. If you want to build LTE anywhere, delivering

100Mbps to users, it needs base stations everywhere connected to fiber.

AUG 20145 6

Fiber is a must in the era of fixed-mobile convergence. At the FTTH Conference 2014 in Stockholm, Sweden, Arief Musta’in, Head of Broadband Division, Telkom Indonesia, Markus Reber, Head of Rollout and Access, Swisscom, and Cenk Serdar, Senior Vice President of the Consumer Unit, STC, provided insights about the future of fiber. Scan for mobile reading

By Linda Xu

FTTx gains a foothold

Burgeoning markets

Today, advanced multimedia services and corporate-based broadband applications, such as videoconferencing, 4K video service and 3D games, are spawning more and more traffic, driving

demand for bandwidth.Over the last two years, FTTx services have experienced

rapid growth. At the end of 2013, the total number of FTTx subscribers surpassed the 230 million mark worldwide at a growth rate of over 25%.

There are dramatic divergences in the adoption of FTTx technologies across the world. Asia-Pacific enjoys the leading place in the FTTx access market with the number of subscribers projected to exceed 129 million in 2014, with the highest penetration rates expected in Taiwan, Hong Kong and Japan. Like its Asian peers, Indonesian Telecom Regulatory Authority is committed to making

broadband ubiquitous across the entire nation. The aim is to introduce broadband access to all 72,000 villages, with half of Indonesia’s 242 million people connected by 2015. Not surprisingly, Telkom Indonesia, the largest communications operator in Indonesia, is aggressively rolling out fiber. As Musta’in pointed out, “We ordered five million FTTx home buses. Last year, we installed 2.3 million; this year, we’ll install 2.7 million more.”

The EU released the European Digital Agenda, which mandates that half of all subscribers should have access to at least 100Mbps services by 2020. This has triggered explosive growth in Europe’s FTTx market. Among 39 European countries surveyed, the average FTTx coverage reached 24% by the end of 2013. According to the FTTH Council Europe, Switzerland (which recently ascended to the league of FTTH leaders) has 2% household penetration and saw 235% growth in subscribers over the 12 months leading up to December 2013. Out of 73,816 Swiss subscribers, 70% were new subscribers in 2013, which is the highest rate in Europe. Swisscom aims to maintain

“STC is delivering broadband via any medium. We are keen to continue maintaining and enhancing our copper network with advanced technologies like VDSL, Vectoring and bonding, which are sufficient to deliver 50 to 100Mbps.

— Cenk Serdar, Senior Vice President of the Consumer Unit, STC

AUG 20147 8

out the copper cable and having only one platform to serve our customer. This is our strategy. We are moving step by step to reduce VDSL2+ by applying the FTTH solution.”

Brownfield deployment isn’t simple; it requires careful handling of copper and fiber resources. Each fiber strand must be accurately installed and the splicing used in passive optic network installations must be properly verified. The fiber must also undergo end-to-end testing before being offered to customers. Markus explained how Swisscom leverages the synergy between copper and fiber, “Fiber-to-the-street (FTTS) is the first step in bringing fiber as close as possible to our customers. Thanks to our excellent existing duct infrastructure, the new feeder cablings for FTTS have been utilized for FTTH deployment. We also use the FTTS equipment for deploying the FTTB solution, depending on existing infrastructure and household density to optimize construction cost.”

STC is also going the brownfield route. According to Cenk, “STC adopted a technology-agnostic approach in delivering broadband service via any medium. We are keen to continue maintaining and enhancing our copper network with advanced technologies like VDSL, Vectoring and bonding, which are sufficient to deliver 50 to 100Mbps.”

Terrain constraints – Complicated geographical conditions can make the deployment of fiber a little tricky. Indonesia’s unique geography is characterized by high mountains, dense forests, and scattered islands. Obviously, their FTTx deployment planning is like solving a puzzle. In spite of the challenges, Arief emphasized that Telkom Indonesia is pressing ahead with FTTx. “We have already designed a complete integrated infrastructure. If we have small residential areas where our cellular services are good, we can also serve them with the FTTx portfolio. In some Indonesian cities, even eastern Indonesia, such as Kupang, Bali, Makassar Manado, where the penetration for the residential is very low and population density is not as high as Jakarta and our mobile BTSs have already spread out all over Indonesia, we’re also thinking about deploying FTTN, FTTC or FTTH.”

Government support – Government support is also instrumental in facilitating the rollout of FTTH networks. The process of laying fiber involves securing approvals from multiple agencies, which is a key challenge. The lack of government cooperation in addressing this issue would be a major roadblock. Fortunately, many governments have actively rendered regulatory support. As Reber pointed out, “FTTH is widely seen as the

the momentum. As Markus Reber put it, “We’re providing 2.3 million households with ultra-high broadband by employing Vectoring technology (covering over 60% of households), FTTS/B solutions (covering over 500,000 households) together with the FTTH solution for one million households by 2015.”

Unlike other parts of the world where hybrid FTTx solutions like FTTC, FTTN or FTTdp are common practice, players in the Middle East target 90% FTTH subscription. In Saudi Arabia, one of the region’s FTTH leaders, Saudi Telecom Company (STC) has been making FTTH deployments at an incredible pace.

Cenk Serdar spoke about STC’s FTTx activities. “We kicked off an ambitious program to deploy fiber in 2011. Currently, FTTH services with up to 200Mbps are available in many parts of the country such as Riyadh, Jeddah and Dammam, the ultimate goal is to provide 1G bandwidth to residential as well as business customers and expand coverage to most of the Kingdom’s cities.”

Bumps in the road to deployment

Paving the way for fiber deployment isn’t easy. There are various challenges to overcome in the construction, installation, and commercialization of an FTTx network. These are the rational planning of the FTTx access mode, efficient transport of the huge bandwidth, quality assurance of experience for multi-play services, and above all, acquiring regulatory support.

Proper FTTx deployment mode – Many operators with few copper resources or poor quality of copper resources are prone to go with a greenfield deployment strategy, as it involves fewer challenges as compared to industrial or commercial brownfield deployment, which seeks to leverage legacy copper infrastructure.

Arief talked about the situations facing Telkom Indonesia and how they are handled, “We have two strategies for fiber deployment. One is modernization, where we are replacing the existing infrastructure with new copper resources. The second is a greenfield strategy with deployment supported by four global players. Our existing copper is around 25-to-30 years old. We know well the quality of our copper. That’s why we decide not to go with Vectoring and G.fast. We are thinking of pulling

“We’ve designed a complete integrated infrastructure. If we have small residential areas where our cellular services are good, we can also serve them with FTTx.

— Arief Musta’in, Head of Broadband Division, Telkom Indonesia

AUG 20147 8

surveys that subscribers of FTTH and LTE services are less likely to churn and are mostly satisfied with the level of service. This is due to the fact that they don’t perceive limitations on their networks, opening the door for us to run bandwidth-hungry applications like 4K ultra-HD videos.”

The bandwidth-intensive applications and services over FTTH network depend on high-performance optical network terminals (ONTs) to sustain optimal user experience, as ONTs function as the hub that receives the signal from the optical line terminal (OLT) and convert it into usable electronic signals that a user’s telephone, computer, TV, or any other devices can receive. It also serves to communicate IP traffic back to the OLT.

According to Cenk, “STC’s current deployment of fiber ONTs puts some limitations on fiber adoption during the in-house installation. As such, STC is piloting a new kind of ONT in the FTTD scenario that allows for using the existing house wirings and DSL modem upon installation, with the objective being to increase fiber adoption and save cost in the coming years.”

Orchestration of fixed and mobile broadband

In recent years, although mobile broadband has gained serious traction, it cannot replace fixed technologies, especially for data-intensive services. Rather, mobile and fixed broadband must grow synergistically to further contribute to broadband penetration.

Markus gave an example of how useful FTTx can be. “FTTH is a perfect basis for rolling out small cells in big cities, since the backhaul is already there with breakouts from FTTH feeder to street poles. Reversely, hybrid bonding of wireless into fixed line also provides opportunity to enhance bandwidth on FTTC/S turf.”

Synergy was often mentioned at FTTH Conference 2014, for instance, Cenk explained, “Over the past years, STC was able to build a considerable customer base in both fixed and mobile business, which is beneficial for cross-selling activities as well as convergence and one-stop-shop initiatives. We believe that fixed and mobile synergy is appealing to improve customer loyalty and retention, increase ARPU, and optimize cost. This integration is extended to market offering, sales channels, customer care, and the organization itself.”

“With FTTH introduction, some utilities take the opportunity to leverage their excellent duct and manhole infrastructure to enter the fiber access business.

— Markus Reber, Swisscom’s Head of Rollout and Access

pinnacle of broadband connectivity in Switzerland. At our early stage of development, the Swiss telecom regulator initiated roundtable discussions with all relevant players in the broadband industry. Rules were agreed upon for economical FTTH rollout to minimize the construction and maintenance costs. Currently, Swisscom has over 20 FTTH cooperative projects in place covering more than one million households and businesses, and more are under negotiation. ”

Investment model – Previously, the hefty investment of fiber deployment was borne primarily by telecom operators. The insurmountable USD35 billion CAPEX on FTTH projects in the past five years has intimidated many carriers, discouraging massive fiber deployment. Today, there is a sort of open network model that is increasingly inspiring and appreciated by several municipal and regional fiber network players around the world. Countries like Sweden, Denmark and Switzerland, have been deploying open access municipal networks, allowing multiple carriers and applications providers the most capable and flexible platform to provide their services enabled by FTTH technologies.

Reber described the situation in Switzerland, “With the introduction of FTTH, some of the utility companies such as electricity, water, gas, heating and sewage management take the opportunity to leverage their excellent duct and manhole infrastructure to enter into the promising business of offering fiber access to their end users. Often these initiatives are backed directly by the local citizens through public ballots.” Such policies facilitate competition and make fiber deployment more attractive to everyone.

Commercializing fiber services

The limited uptake of fiber services is as big a challenge as the deployment of the service infrastructure. Besides the high cost of these services, the lack of relevant content to be delivered through these networks dampens the potential user’s enthusiasm. In addition to common triple-play offerings such as IPTV services and VOD, fiber players have considered marketing 4K and even 8K ultra-high definition video services to fully capitalize on their connection speed advantage. Such offerings would contribute to an inspiring customer experience.

Cenk shared STC’s experience about the benefits of high-bandwidth services, “STC learned from customer satisfaction Editor: Morgan timothymorganhatrick@huawei.com

AUG 20149 10

The 2014 FIFA World Cup marked a high point in Brazilian soccer mania, with the lucky fans onsite spreading the love seamlessly across Brazil, and roughly 1.5 million visitors from other countries sharing their memories worldwide. Vivo, the largest mobile operator in Brazil, made a tremendous commitment to ensuring an inspiring experience. Andrea Folgueiras, its CTO, has the details.

Mobile changes football

VOICESFROM INDUSTRY

Bigger event, bigger surge

V ivo, Telefónica’s subsidiary in Brazil, boasts the country’s largest local mobile broadband market share (almost 30%). It is in the midst of an LTE deployment, where an enormous

traffic surge is now in progress. Andrea Folgueiras, CTO of Vivo, has told WinWin that, “The increase of traffic during those (World Cup-type) events is huge, made up of three digits normally. It’s difficult to say how much. But it is not only in the stadiums during the matches, it is all the activities that happen around, like people visiting tourist places. So all of a sudden, you have a lot of roamers that you don’t have in your network. This is something that we are catering for. We have studied what happened in the last World Cups, and in the London Olympics, but we are sure that we are going to see probably different things from elsewhere.”

The FIFA World Cup 2010 in South Africa was the first event of its kind in the digital age, with social media already having significant traction. Fans became hooked on having their shouts and whistles heard around the world, with FIFA President Joseph S. Blatter joining in. “Social media websites will play an important role in connecting everyone who cares about the game of football. I’m very excited to be sharing my own personal experience of the 2010 FIFA World Cup with football fans from all over the world.”

There were over 3,000 tweets per second at the high point of Japan’s World Cup victory over Denmark, a staggering number. As such, event organizers must pay special heed of social media, as failures can be disastrous, as they were in London two years later. At the London games, organizers had to suggest to fans that they rein in their tweeting, and

By Julia Yao & Linda Xu

Scan for mobile reading

9

AUG 20149 10

The traffic increase during World Cup-type events is huge, three-digits normally. It is not only in the stadiums during the matches, but all the activities that happen around.

— Andrea Folgueiras, Vivo CTO

10

AUG 201411 12

broadcasters had trouble covering a major women’s cycling event as they were unable to determine the distance between cyclists due to GPS and communication malfunctions.

At the Sochi games this past winter, each attendee carried two or three digital devices, and 120,000 devices generated content. But fortunately, ten times the bandwidth was available in Sochi as was available during the previous Winter Olympics, and failures were kept to a minimum.

Vivo wanted zero failures, but it had a much different challenge, as the 2014 FIFA World Cup was hosted in 12 Brazilian cities, with festivities stretching far beyond. The Wall Street Journal recently dubbed Brazil the “social media capital of the universe.” It ranks number two in terms of Facebook market and in YouTube visits, and during the games, its cyberspace was wall-to-wall football (7.6 million data connections were generated during the roughly five hours surrounding the opening round of games), and a lot of that content was user-generated.

According to Folgueiras, “What happens normally, in the case of football matches, is peak traffic during the breaks, and just after or before the matches. During the matches, probably people will be producing videos, and they will be willing to share in real time. So I would say one of the biggest challenges in this type of event is the uplink, which is normally quite balanced with downlink in everyday life.”

Spreading the love

In Brazil, 5,094 of the country’s 5,564 municipalities (Brazil’s population is 80% urban) are serviced at least in part by mobile broadband. Regarding LTE, Folgueiras said, “Today we already have 74 cities covered with LTE, already covering 12 host cities for the World Cup. On top of that, there are many more cities where teams are going to stay. So there are many other places in Brazil where the teams are going around. Up to April, we will have 20 or more cities to be covered with

During the matches, people will be producing videos, and they will be willing to share in real time. I would say one of the biggest challenges in this type of event

is the uplink, which is normally quite balanced with downlink in everyday life.

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LTE. So I think there will be good LTE coverage on 2.6GHz.” One of the host cities was Manaus (population: 1.7

million), the largest city in the Amazon basin (population: 3.7 million). To get this remote city and its neighbors up to speed with the rest of Brazil, Vivo laid the very first wavelength-division multiplexing (WDM) lines to cross the Amazon, in August 2013, as part of a 2100km WDM network that spans over 20 cities in the region, including five super-long spans that exceed 200km.

When speaking about the background and effects of this project, Folgueiras said, “We were using satellite and other high-cost infrastructure, but we couldn’t achieve the capacity that we wanted. So it has been interesting to see that after connecting the fiber in Manaus, there has been an explosion of the traffic that had been restricted (by the marginal infrastructure) before.” At present, this WDM network supports 40G, but it can evolve to 100G with relative ease.

It might get a little hot

Such infrastructure will benefit the Amazon’s residents and the nation as a whole for years to come. However, for stadiums and their surrounding areas, hotspot coverage is equally or even more important during events. Fortunately, Folgueiras and Vivo had a plan. “We arranged indoor systems and distributed antenna systems economically to cover the stadium, the press areas, and places people go when there is a break, with a lot of capacity of 2G, 3G and 4G. And on top of that, we had dedicated remote teams to monitor quality and capacity on a real-time basis and react according to need.”

However, attention must also be paid beyond stadiums, as tourist attractions and other gathering places also see big surges. For the FIFA World Cup, among the most popular are the Fan Fests, open-air stadium extensions created by FIFA originally for the 2006 World Cup in Germany. At Fan Fests,

tens of thousands of fans who can’t make it to the stadiums gather to watch the games on big screens and enjoy pre-match entertainment, and mobile service is often supported by van-based gear and other short-term solutions.

According to Folgueiras, “We have a plan in place to deploy mobile sites in areas where there will be more traffic close to hotels and tourist places and airports. Mobile sites are very easy to transport. When we finish using them for the World Cup, they are prepared to be normal sites where there are rollout plans. This is what we did when the Pope went to Rio and we had deployed mobile sites at the beach of Copacabana. They are not there anymore. There are normal sites in place now.”

Preparation in overtime

Vivo teamed up with Huawei to deploy Huawei’s E2E Key Event Assurance Solution from March 3 to July 31, which featured expert delivery teams, a standardized maintenance process, cutting-edge maintenance tools, scientific methodologies, and superb project management. According to Folgueiras, “We will have a dedicated team that monitors capacity and quality in real time to make sure that the user experience is the right one.”

Before the World Cup, Huawei’s project team analyzed & predicted KPIs, network resources, and the relevant capacities, with this all supplemented by drive-test results and emergency planning/drilling, enabling the project team to develop contingency plans to address any issues caused by a traffic surge.

During the games, a Huawei expert team set up a network analysis center to conduct real-time network monitoring, network alarm analysis, real-time modification of network parameters, on-site emergency processing, and remote solutions to ensure a rapid response and continued network security and stability.

Vivo has laid a 2100km WDM network that spans 20 cities, including the first lines to cross the Amazon, and five

super-long spans that exceed 200km each.

Editor: Jason jason.patterson@huawei.com

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Perspectives

Over the past several years, mobile broadband has been developing rapidly, now covering more than two billion people. More and more individuals, businesses, and organizations are

joining a connected world. In addition, such things as glasses, watches, shoes, and various types of devices, even the seemingly unrelated toothbrush, have all somehow become intelligent and connected in ways never thought possible.

Connectivity has become part of our work and life. The relationship between connectivity technology and the physical world is also undergoing profound changes. People’s work and life are made easier thanks to connectivity. By being incorporated into various exploration activities, connectivity increasingly unleashes human potential and creates new business opportunities.

Envision a Better Connected World

As the physical and digital worlds continue to converge, information and communication technologies (ICTs) have become the new engine that propels our world, having a profound impact on our daily lives. Expectations from ICT infrastructure will only rise, and there are key strategic planning issues that we must consider today as we prepare for a sustainable and ever-changing future.

By William Xu, Chief Strategy Marketing Officer, Huawei

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This is a very interesting change. As long as real-time, dynamic, and intrinsic data concerning human behavior is synchronized, transmitted, processed, analyzed, and presented using cloud computing and big data technologies and is combined with today’s business world, it will unleash infinite potential in all industries, such as finance, automobile, healthcare, and education. All this is just the beginning.

Connectivity has become a new norm of life

Today, about half of the world’s population uses various types of connectivity to access networks. This connectivity allows them to handle email, shop, and communicate with

Ken Hu

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friends. We cannot imagine what it would be like if individuals,

businesses, or organizations are disconnected from the network in modern society. We become anxious when there is no network signal or the “page is loading” prompt is displayed for too long on our screen. Even more agitating is the “low-power” display. Connectivity has become a new norm of life. Better connectivity means higher speed, zero wait-time, real-time display, and ubiquity, as well as high security and reliability. Many people today regard connectivity as the most essential human need, and seem unable to live without network access.

ICT is leading the next wave of social development

Continuous social development, especial ly the development of the traditional industrial civilization, has consumed too many non-renewable resources. This means if we refuse to change our production model, sustained social development will become impossible.

We believe that ICT technologies, particularly mobile broadband, cloud computing, big data, and the Internet of Things, are reshaping the world and leading the next

wave of sustainable social development. Today, ICT technologies have shifted from a support system that was designed to improve efficiency to a production system that drives value creation. Connectivity has become a new factor of production in addition to land, labor, capital, and technology.

Earlier this year, Huawei conducted a survey on the level of connectivity in 25 countries and across 10 industries. Countries covered in this survey included developed countries such as Germany, France, and the U.S., and emerging countries such as Russia, Chile, and Brazil. Industries included agriculture, education, and finance, among others. We have found that the level of connectivity has become an important measure that helps improve the competitiveness of countries. Take Chile in South America as an example. It ranks fourth worldwide and tops in Latin America (amongst surveyed countries) in terms of the level of connectivity. Chile is driving economic development by continuously increasing investment into ICT technologies, leading to the emergence of “Chilecon Valley.” Chile is rapidly establishing broadband infrastructure and encouraging innovation to concentrate a wide array of talent, technology, and business resources. Today, Chile has become the most innovative and vigorous region in Latin America.

Mining is the pillar industry in Chile’s economy. Safety

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has become a challenge for Chile in its development of the mining industry. In 2013, an innovation team in Chile utilized innovative ICT technology to design a life-saving jacket for miners. A large number of sensors and network connections are embedded in this jacket. This wearable alerts workers to hazards in advance, such as exceedingly high concentrations of dust or poisonous gas, and allows them to receive various types of information. Such innovation would significantly improve the production safety of the mining industry. This kind of innovation also provides more safety assurances for other special industries, such as firefighting. Local economic development also benefits from such innovation.

At the industry level, boundaries are constantly being eliminated. We believe that all enterprises will become Internet companies. Enterprises will provide products and services to their users based on information and data analysis. All enterprises, both traditional and high-tech, will lose in future competition if they cannot benefit from a connected world, fail to innovate their business and transaction models by leveraging connectivity, or do not optimize their operations or marketing through the collection and analysis of user data.

Starbucks serves as a good example of companies in a traditional industry that have made the move to high-tech enablement. According to statistics, mobile payment channels at Starbucks in the U.S. contributed more than USD1 billion in revenue in 2013, accounting for 14% of the total transaction amount for Starbucks. If Starbucks wanted to engage in the finance sector, it could quite possibly turn its outlets located on the street corners into banking outlets. This degree of technological enablement is a perfect example of value transformation as a result of embracing and seizing opportunities presented by connectivity. We can safely say that companies like Starbucks are winning the future by leveraging better connectivity.

Shattering the limits of time and space

We have never been clearer about the future than we are now. The future is upon us. What will a Better Connected World be like in five years?

First, people will be connected more closely, obtain more knowledge, and receive better education. The biggest impact of the Internet on the world is that it breaks the limitations in the transmission of knowledge and enables all people to have equal access to knowledge from different countries and cultures. Maybe a person with potential greater than that of even Einstein is confined to an unconnected corner of the world. Due to a lack of good education, he may only be recognized as a smart person in his own village. In five years, every corner of the world will be connected, everyone will be able to afford mobile devices, and various online education tools will become a part of life. Once this progress comes, this genius will definitely be able to play a bigger role and even make our world a better place to live.

Statistics show that today less than 6% of the people

In five years, every corner of the world will be connected, everyone will be able to afford mobile devices, and online education tools will become a part of life. Once

this progress comes, this genius will make our world a better place to live.

Perspectives

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in Sub-Sahara areas receive higher education; this figure is 26.5% in China. For the African continent, traditional classroom teaching can no longer meet the tremendous requirements for higher education, not to mention the regional requirements for economic development. With the increase in network and fiber coverage and the development of alternative electric power in Sub-Sahara areas, the potential of ICT applications in the education sector will be unleashed to a much greater extent. Online courses, including open educational resources (OER), have shattered the limits of time and space. Students can freely choose the time and venue for learning, which greatly expands learning channels and reduces the cost of education by more than 50%. We firmly believe that the most successful universities in five years will be universities that provide education to the entire world.

In Tanzania, the “Wired Mothers” program helps mothers learn about prenatal and newborn care from their mobile phones, remarkably improving the health of babies. With the expansion of network coverage, regions where knowledge could not be obtained through mobile phones in the past now have access to such services.

Last year, Huawei partnered with Microsoft in the

4Afrika initiative in providing smartphones to help more African people get connected.

Connectivity with higher bandwidth will enable immersive experience. Let’s imagine that football fans are able to watch exciting football games from the best position in the football stadium at any time as long as there is sufficient bandwidth.

In the U.K., the National Theatre Live project broadcasts the best of British theater live using 4K technology to cinemas for those unable to attend the live event. These audiences can have nearly the same experience as those in the National Theatre.

The 2014 FIFA World Cup was broadcast live using 4K technology. Viewers enjoyed nearly the same visual experience from the comfort of their home as those at the stadium. To make this viewing experience possible, viewers must have a minimum of 80 to 100Mbps in their home. At Huawei’s laboratories, our “Mirror Sys” team is researching and testing interactive experience at a bandwidth of more than 500Mbps.

Things will be connected more extensively, unleashing infinite business potential. More comprehensive and thorough perception as well as ubiquitous connectivity will

We believe that future digital logistics require more pipes that are bigger and faster to support the massive, ever-growing amounts of traffic. This is a strategic opportunity

for Huawei. We are committed to becoming an enabler for digital logistics.

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make it possible to get everything connected, which will greatly promote the future development of technology, the economy, and society at large. All industries will be able to explore higher value from a connected world.

After sensors and big data restructure the automobile industry, the business model of insurance companies will change significantly. Based on the data obtained through connectivity, insurance companies can analyze the driving behaviors of vehicle owners through modeling and draw conclusions to help them set premium charges and apply discounts. Analytics will be able to combine such factors as model safety, maintenance records and general conditions of the vehicle, owner driving habits, and the accident rates along frequent driving routes in addition to the owner’s driving record. Vehicle owners with no accidents in the past year who meet other discount criteria will be entitled to higher discounts on their premiums. The opposite is also true. Supported by big data, insurance companies that operate based on connectivity will have a huge advantage over those that fail to change from the traditional model in insurance services.

As early as the second half of 2015, a telematics module from Huawei will help vehicles from automobile manufacturers such as Benz join a Better Connected World.

In the future, everything will be connected. Our work, life, study, entertainment, and just about anything else imaginable will be connected in the cloud. When every desk in every classroom, every computed tomography (CT) machine in every hospital, every seat in every cinema, and every vehicle on the road are connected to the network, just imagine how much data and information will be generated. Infinite business opportunities will be created from such information and data. How many new services and how much business value can be created accordingly? These are the opportunities for the industry and the direction Huawei is working towards.

Huawei will become an enabler of digital logistics

With the increase in traffic, content, and applications, as well as the development of mobile Internet, the volume of data will grow at a speed beyond our imagination. The era of massive data traffic is drawing near. There will be a pipe with a diameter even wider than the Pacific Ocean, more real-time big data platforms, and a larger number of connected things. How can such a massive volume of data be transmitted, processed, stored, and presented? With this purpose in mind, Huawei builds highly-efficient connected digital logistics systems in collaboration with customers and partners.

We believe that future digital logistics require more pipes that are bigger and faster to support the massive, ever-growing amounts of traffic. This is a strategic opportunity for Huawei. We are committed to becoming an enabler for digital logistics. We will increase investment in IT technologies represented by cloud computing and virtualization. On this basis, we will restructure traditional IT and CT networks, comprehensively improve their efficiency, and structurally reduce the total cost of ownership (TCO). Through these measures, future networks will not only be able to cope with the challenges from the digital deluge, but also create new value for us. Our vision is to build a Better Connected World.

The world will ultimately become closely connected and globalization will enter a new era, driven by ICT convergence. Today, connectivity is competitiveness, thanks to collaboration between the ecosystem and the industry chain, characterized by technological and industry convergence. Huawei looks forward to working closely with partners from the industry and academia to build a win-win industry chain.

Just imagine when every desk in every classroom, every CT machine in every hospital, every seat in every cinema, and every vehicle on the road are connected

to the network. Infinite business opportunities will be created.

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IoT: Driving endless possibilitiesThe IoT concept has broadened to cover a plethora of technologies, applications and services. According to IDC, IoT and its ecosystem are expected to be a USD8.9 trillion market in 2020. IoT will be fully pervasive, interactive and intelligent. Professor Rahim Tafazolli, Director of the Centre for Communications Systems Research, University of Surrey, paints a vivid picture of IoT enhancing quality of life while providing new revenue opportunities for a host of enterprises.

By Linda Xu & Joyce Fan

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Integrating with senses

WinWin: From your perspective, what would be the most exciting and anticipated IoT application in our business and daily lives?

Rahim Tafazolli: Probably, the most exciting and long-term IoT application is that sensors will detect our state of mind and mood. Accordingly, the actuators will respond to the current state of mind and mood of the person and change the environment. For example, if you are happy, sad or tired, appropriate music is played and the ambient light will change according to settings you have configured. That is effectively minimizing the boundary between the cyber world and physical world. It is a very exciting but

long-term application.There are many short-term applications. For example,

smart metering is a very clear business case. Big sensors like connected cars are happening now. Medical applications are using sensors to monitor what is going on in your body. For instance, medicine capsules equipped with sensors are already in use to help doctors better understand the effectiveness of the medicine.

WinWin: Sensor fusion holds a lot of promise for IoT. What are some potential applications?

Tafazolli: Currently, sensor fusion enables context awareness. It gives enough information about the user context for us to determine whether the user is standing up, walking, lying down or in a meeting. That kind of

Professor Rahim Tafazolli, Director of the Centre for Communications Systems Research, University of Surrey

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— Fotis Karonis, EE CTO

Smart metering needs to evolve beyond simply reading gas meters, electricity meters, or other utility meters. It can control appliances and provide

information about security and energy efficiency at homes. I believe it will evolve into smart city applications that help manage transportation and security.

— Dr. Zhu Peiying

information is easily obtained by sensor fusion in the smart phone. We have proved the technology is very accurate in measuring the electromagnetic field together with gyrometer and accelerometers to determine the context of a user. Many years ago, we performed experiments in which we detected and monitored subjects’ states of mind. It was a large European Union-funded project that had us working with medical specialists and psychologists. We detected very simple states of mind like happiness, sadness, tiredness and stress by measuring the temperature, blood pressure and heartbeat, etc. We were able to process the data to successfully determine the state of the mind of a person so that we could make informed modifications by playing music for example to change the mood from stress to relaxation.

Mining gold from IoT

WinWin: Do you see any specific industries that either have been or are being revolutionized by IoT technologies in terms of their ICT infrastructure and business model?

Tafazolli: I wouldn’t say any industries have been revolutionized or have changed business models because of IoT. Most IoT applications are very application-specific at the moment and they are mainly provided by SMEs like two-man or three-man companies. I believe these applications will not become global and will always be a niche market unless we standardize IoT. If we have globally accepted standards in IoT, it could have potential to revolutionize companies or change business models. The basic services like smart metering can evolve. Connected cars will become an important part of every country’s infrastructure. So connectivity of cars cannot

be overlooked as we are connecting our mobile devices to the Internet. I believe it is a very important application that now needs to become a part of long-and short-term planning.

WinWin: What kind of business opportunities can be seized in the IoT era?

Tafazolli: There are many. The user context is extremely important: where is the user, what are they doing, what do they need, and what is their profile? All this can be obtained from the fusion of different sensor technologies. Based on the user context and user environment, you can provide an appropriate service or resource for communication. This is becoming embedded as part of the requirements and technologies for the communication systems. One very clear business case, as I mentioned, smart metering is a simple form of IoT. Most national governments plan to completely deploy smart metering throughout residential zones before 2020.

But smart metering needs to evolve beyond simply reading gas meters, electricity meters, or other utility meters; it must also provide intelligence for smart homes. It can control appliances and provide information about security and energy efficiency at homes. I believe that smart metering, though simple, will evolve into smart city applications which can help manage the transportation and security surveillance in the city amongst many other applications, because information and location-based services are extremely important applications that IoT can provide.

Another important area is telemedicine and healthcare. If you look at countries like the U.K., the cost of national healthcare services is huge. If we could remotely monitor people’s health, they wouldn’t have to go to hospital and consume huge resources. It can even predict the health

Perspectives

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condition of people and take measures proactively. I think that is probably the third biggest market.

WinWin: Are business models changing in traditional industries like manufacturing, transportation or retailing because of IoT?

Tafazolli: Yes, but not in the same way that telecom business models are changing, because new players are coming in. The most important player is the user, because of security and privacy concerns. There is a huge amount of information you can collect about the user. The question is where the information goes and who handles the information. The traditional business models involving manufacturers, operators, subscribers and service providers have to expand to include other new stakeholders. For example, for developing smart homes and smart cities, other types of players involved may be insurance companies, local authorities and different regulators from utility companies. That’s why it becomes difficult. It is an extremely multidisciplinary technology. It is not only about telecommunications or electronics, but also involves

For developing smart homes and smart cities, other types of players involved may be insurance companies, local authorities and utility regulators. That’s why it

becomes difficult. It is an extremely multidisciplinary technology.

different regulators, like security and privacy, health, energy etc. So, monetizing IoT is very challenging.

WinWin: To facilitate the robust development of IoT, what kind of support is required from regulators, vendors, and telecom operators?

Tafazolli: From users’ point of view, there are many stakeholders, such as local authorities and different regulators. One challenge is that different bodies such as the spectrum regulator and utility companies need to work with each other. In addition, we need a global standard for IoT. At the moment, IoT standards are quite fragmented. For example, Constrained Application Protocol (CoAP) was codified by the European Telecommunication Standard Institute (ETSI); IPv6 over Low power Wireless Personal Area Networks (6LoWPAN) was codified by the Internet Engineering Task Force (IETF); IEEE has been providing ZigBee standards. I believe we need to have at least one common globally-accepted standard. It would help IoT business and technology to flourish. Otherwise, most IoT networks and applications would be very local

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and limited. Besides, with a single data mining or artif icial

intelligence algorithm shouldn’t be applied in whole range of applications. We need different algorithms for different applications and they need to be customized. Currently, we have a good grasp on most data mining technologies and related algorithms. What we don’t have is the common standard in terms of metadata and semantics to describe the information. I don’t believe we will have one global semantic description technology or application. We need to specify a basic set of semantic technologies and new semantics will be generated for the future services. That is the big gap between what we have now and what we need for the future as we expect a huge diversity of different IoT applications to accommodate different requirements.

Giving IoT room to grow

WinWin: As IoT advancement is tied to connectivity, what is your prediction about network evolution enabling IoT growth?

Tafazolli: Most of the applications in IoT generate low data rates and could be extremely time sensitive. We need very quick response time. And if you look at the car as a sensor, it doesn’t always generate a low data rate due to different latency and requirements. We can’t flood the network with every piece of generated data. We need different network architecture and hierarchical network architecture with different points in the network for data mining and data processing. Otherwise, the network will be flooded with a huge amount of useless data. And we need to do data mining at every stage at sensor and network gateways. We should have a

I believe that in the future, only important things will be connected. If things are not important, they will not be connected. If they are serving people and society,

or are helpful for growth of the digital economy, they have to be connected.

mechanism for structured and unstructured data in order to gain information from metadata. We must also be able to extrapolate information to make projections and predictions. So data handling is extremely important and very challenging when it comes to IoT.

It’s very difficult to give the concrete prediction of bandwidth requirements of the future. For example, the range of applications, including smart metering, that sends a few bytes every couple of days depends on the number and spread of the network. But the data would be definitely huge and most of the data is useless and/or only useful for a limited time. We need to do data mining to discover appropriate data in the network and link appropriate data from one application or a sensor to another application more intelligently. We must also look at new search mechanisms, new storage, and retrieval systems. In general, that’s why information-centric networking and content-and context-based networking are more appropriate in the future.

WinWin: The IoT is still new, but some speculate that it will not only connect things that obviously need connection, but will penetrate absolutely everything, even unexpected objects. What do you think?

Tafazolli: I believe that in the future, only important things will be connected. To put it another way, if things are not important, they will not be connected. It is absolutely right that connectivity is the key to the future and it is not only about connecting people but also connecting your fridge, toaster, your cars, smart metering, your building, your offices and even your pen, chair, etc. If they are serving people and society, of if they are helpful for growth of the digital economy, they have to be connected.

Perspectives

Editor: Morgan timothymorganhatrick@huawei.com

AUG 201421 22

T h e n u m b e r o f g l o b a l I n t e r n e t d e v i c e s h a s reached 12 billion. Mobile payment is everywhere,

making life more convenient. Cloud computing is reinventing business models. The Internet economy is revolutionizing the whole world by rewriting global business rules time and again – speeding up social development.

For bus ines se s , g rowth ra te , responsiveness to changes, and quickness of business model transformation are essential to survival and prosperity. In a time of interconnection and ubiquitous information innovation, IT has become a key enabler for businesses to build a new model of competitiveness. In the IT field, cloud computing, mobility, social media, big data, and the Internet of Things (IoT) are the five development trends. Meanwhile, as basic IT platforms, networks are facing great challenges.

Challenges to the networkCloud computing demands higher network quality

Many people were fascinated when Amazon’s cloud service entered China. In fact, this is a sign that cloud computing is having a great impact on the traditional operation model of data centers (DCs). For networks, cloud computing may pose a greater challenge since the prerequisite for resource cloudification is strong network support. Currently, cloud

By Liu Shaowei, President of Enterprise Networking Product Line, Huawei

computing poses different challenges to traditional networks depending on whether they are DC-to-user networks, or internal DC networks.

• Internal DC networks: Flexibility & bandwidth are challenging

First, enterprise DC cloudification and virtualization are now a general trend, which requires quick migration of virtual machines (VMs) and a dynamic network to support this. There is no interaction between the traditional closed network and virtual resource management, so the network cannot support VM migration. That’s where software-defined networking

(SDN) comes in. SDN treats the network as a resource and opens it to upper-layer IT services, realizing dynamic, real-time, and flexible network adjustment.

Second, in the future, 70% of all traffic will be generated on DC networks while 16% and 14% will be generated on carrier and enterprise networks, respectively. Server interfaces have expanded from GE to 10GE and are now expanding to 40GE and 100GE. This means that the demand for DC network bandwidth is increasing at a much faster pace than Internet broadband.

• DC-to-user networks: User experience is the greatest challenge

With the deployment of desktop cloud and service migration to the cloud, networks are now similar to computer buses. Network quality has a direct impact on user experience. For example, desktop cloud bears not only work flows and emails, but also real-time video conferencing and voice services. Multimedia services demand excellent network

Agile networks: Ready for the futureIn the last decade, network devices have become increasingly IP-based and interfaces are increasingly Ethernet-based. In the future, networks will be IT-based and industrial bearer networks will be IP-based. IP- and IT-based networks must be open, flexible, fast, automatic, and highly efficient, while delivering a good user experience. Simply put, networks must be agile.

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quality. Poor network quality will lead to inferior user experience. In reality, areas adjacent to DCs often have better network quality and user experience.

User mobility complicates traffic management

With the popularization of mobile devices, BYOD has become an effective way for businesses to improve office efficiency. Mobility also poses many challenges to traffic management, VIP user experience assurance, resource allocation management, and QoS policy migration to enterprise networks.

Challenges to traffic management: Wi-Fi is now widespread in enterprise campus networks and employees can work at any location, making traffic unpredictable. This unpredictable “swarm traffic” is a great challenge to user experience. For example, if there are too many employees using Wi-Fi at the same time in a meeting room, the traffic will surge quickly, posing enormous pressure to upstream switching devices. In this case, not only the service experience in the current meeting room degrades, but service experience of other meeting rooms connected to the same switching device will be affected as well, particularly for those real-time and bandwidth-hungry services like high-definition video conferencing.

Meanwhile, few enterprise campus networks are configured with QoS priorities. A few exceptions are configured with static priorities. This means when the traffic surges, VIP user experience cannot be guaranteed. For example, if an employee needs to access Wi-Fi to process urgent or important business, surging traffic could make it hard for him to do so, and that could result in loss for the company.

Challenges to dynamic policy migration: Changing user access locations and modes require user-related network access control (NAC) and QoS policies to change accordingly. In a large enterprise campus network, the fixed network, WLAN,

and external access all have their independent authentication and control centers and systems. The NAC and QoS policies must be statically configured for each system, which is time and labor-consuming. The existence of multiple social networking services also has a great impact on networks.

Used by an increasing number of businesses, social networks are undoubtedly a great place to promote services. According to Gartner’s forecast of the 10 most influential technologies in 2014, if a business does not have an effective basic network for multimedia communication, its competitiveness will be greatly diminished.

Social networking requires multi-service, which has a profound impact on networks. Different networks place different requirements on the network. Voice services require a packet loss ratio of less than 10-2 and HD video requires a packet loss ratio of less than 10-6 to prevent pixelation. For business users, the most annoying thing in a video conference is pixelation. On a traditional network, it is impossible to identify whether pixelation is caused by the video conferencing system or the network. It’s also difficult to pinpoint the problem to a single device and board. How to support these bandwidth-consuming services and ensure maintenance is a key question future networks need to answer.

Many businesses are thinking about deploying social media systems that enable multipoint video conferencing. This surging traffic, combined with swarm traffic, makes the traffic model in an enterprise campus network more unpredictable.

Big data analytics is required to defend against network attacks

Big data analytics has been gaining attention in recent years. Google once used it to accurately diagnose a flu outbreak in the U.S. based on the most frequently searched pharmacy names and disease symptoms. How will big data analytics influence the ICT industry?

In the future, 70% of all traffic will be generated on DC networks while 16% and 14% will be generated on carrier and enterprise networks, respectively. Server

interfaces are now expanding to 40GE and 100GE. Demand for DC network bandwidth is increasing at a much faster pace than Internet broadband.

Perspectives

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As enterprises become more globalized and mobile workers become more common, network borders are blurring. Network attacks also become more varied due to employee mobility and diversified terminal types. Wireless tapping, attacks targeting mobile terminals, and 3G/LTE-based mobile network attacks are now commonplace. Traditional networks still rely on static single-point attack protection mechanisms. Firewalls, intrusion prevention systems (IPSs), and data loss prevention (DLP) devices work independently without any interaction. Big data analytics can help people perceive and even forecast abnormal traffic and security threats so that they can schedule all network resources for defense.

IoT requires intelligent networks

The IoT is no longer just an idea. It is a trend of business and industry development. Statistics show that 10 billion things were interconnected through networks in 2013, and the number is going to surge to more than 50 billion by 2020. Many businesses are using technologies like IoT and big data analytics to conduct complex and more accurate operations, leading to a strong demand for intelligent networks.

Of course, networks must be of high bandwidth and reliability to support unprecedented traffic. Further, as IoT is intertwined with our lives, pipe security must be guaranteed. A market survey in the U.S. found that the most attacked facility in America’s IoT is its waterworks. We cannot tolerate the possibility that a malicious attack could lead to contamination of public drinking water. Therefore, in the IoT era, networks must ensure pipe security in addition to supporting a large number of nodes and a wide variety of interfaces.

The above changes require a new generation of enterprise network architecture, and that’s where Huawei’s agile network comes in. It was developed specifically to cope with the current network transformation challenges.

What changes can the innovative agile network bring?

In the last decade, network devices have grown increasingly IP-based with interfaces increasingly Ethernet-based. In the future, networks will be IT-based and industrial bearer networks will be IP-based. IP-and IT-based networks must be open, flexible, fast, automatic, and efficient, and deliver a good user experience. Simply put, networks must be agile.

Huawei has launched the agile network solution, which, for the first time, integrated service models with technical models. The new-generation network architecture integrates requirements of mobility, cloud computing technologies, and security collaboration.

The agile network is different from the traditional network in five aspects. The agile network puts greater emphasis on users, services, and customers experiences and a bit less on technology, devices, and connectivity, while taking the entire network into account rather than only a single point. It enables perceptible network quality while the traditional connectionless-IP-based network that relies on the best effort principle does not support network quality perception. The agile network features automated network configuration and service provisioning, and is a software-defined network (SDN).

The agile network can be deployed in enterprise campus networks, DCs, branch networks, and WANs. It represents the latest ideas and results of SDN research. In 2013, Huawei focused on agile campus networks. Through on-demand service, security collaboration, quality perception, wireless/wired convergence, and SDN smooth evolution, we helped enterprise customers transform their networks to support new services in an agile way.

Change #1: Network resource cloudification and service ubiquity

A market survey in the U.S. found that the most attacked facility in America’s IoT is the waterworks. We cannot tolerate the possibility that a malicious attack

could lead to contamination of the public supply of drinking water.

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Ubiquitous service means the network policies, resources, and services can dynamically migrate as users move. Wherever users are, they can access the network on any type of terminal and enjoy a consistent service experience. The following policies need to migrate as users move to ensure consistent service experience.

Access control policy: To ensure portable policies, Huawei employed the SDN architecture in the agile network. In DCs, SDN allows network policies to migrate as virtual machines (VMs) migrate. Huawei also introduced SDN to enterprise campus networks to enable migration of network resources and policies in accordance with the migration of employees. When campus controllers are deployed in a network, IT personnel need only to configure the controllers rather than the machines. The controllers can then function as a brain, translating and delivering signals to switches. Since IT personnel now make configurations on interfaces with graphics and natural languages, what used to be complex is now simple.

QoS policy: QoS policies can also be configured on a controller. When many people are in a meeting and the traffic surges, the controller can accurately deliver the QoS policy to the switch nearest to a VIP user to make sure they can enjoy guaranteed bandwidth for a smooth experience. When BYOD becomes prevalent, the QoS policy will become more important in enterprise campus networks featuring services on mobile terminals such as Internet, voice, video, and other important communication services. After configuration on the controller, QoS policies can “go” wherever a user goes, which ensures guaranteed bandwidth and priority for VIP users/groups and key services.

Storage and service policy: Large companies have more than one DC. To ensure consistent user experience, access latency must be minimized. Since these DCs are distributed across the globe, hot backup is adopted for important service

systems such as Enterprise Resource Planning (ERP). The active-active backup mechanism ensures that employees enjoy consistent experience and minimum latency while accessing different DCs. This means that when employees travel between facilities supported by different DCs, they enjoy the best service experience no matter if the DCs are in different cities or even in different countries because services and service data are dynamically shared between DCs. This process is called “floating” and can be realized by the integration of storage and networks on an agile network architecture.

Change #2: Full-scale security collaboration on the entire network

Huawei integrates security analysis software into the controller to collect log information of all devices on the entire network and record all security events. The controller analyzes all information to detect threat anomalies that would not be detected through single point analysis. In the event of suspicious activity, the controller sounds the alarm and sends a report to network administrators. Network administrators can then schedule all network resources to defend against threats. This simplifies network administrators’ work and protects system security.

When a certain enterprise network was attacked, the network administrator summarized the data afterwards, and found that if the logs of the attacked device and its surrounding devices had been properly analyzed, the attack would have been detected and successfully resisted. So then, why wasn’t defensive action taken? Because the log data is so extensive that by the time it is processed and analyzed by a lone network administrator, it’s too late.

Big data analytics enables collaboration for security protection and timely, even preemptive detection of potential threats.

Huawei integrates security analysis software into the controller to collect log information of all devices on the network and record all security events. In the event of suspicious activity, the controller sounds the alarm. Administrators can

then schedule all network resources to defend against threats.

Perspectives

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Change #3: Transparent network quality and accurate network management

With connectionless IP, network quality is opaque on the traditional network. Huawei’s Packet Conservation Algorithm for Internet (iPCA) can solve the problem of network quality perception using a reserved bit to color, check, and count packets to accurately detect packet loss.

iPCA brings a lot of benefits in many scenarios. Quality monitoring of WAN leased lines: Many

enterprises lease dedicated WAN lines from carriers. These leased lines are subject to constant packet loss, but why isn’t the packet loss perceived by users? Because of the re-transmission mechanism of TCP and the application layer. Even though user experience is guaranteed, network quality is still affected by packet loss. iPCA can be deployed at both interfaces of a leased line to record all packet loss, allowing enterprises to accurately evaluate the quality of the leased line.

Transparent link quality monitoring: For multimedia services such as HD video conferencing, there are only a few devices. After iPCA is deployed, the number of lost packets and the locations of packet loss can be accurately recorded. As a result, the video conferencing quality can be monitored and faults can be detected and then prevented or rectified.

However, if devices from other vendors do not support iPCA, how can iPCA be realized? Must all devices on the whole network be Huawei devices? Absolutely not. The iPCA only changes the reserved bit in IP packets and IP packets can be transmitted among all devices. Therefore, enterprises need only to deploy Huawei devices at particular network locations to evaluate the network quality of a corresponding network segment.

Change #4: In-depth convergence of wired/wireless networks

What is in-depth convergence? How is it helpful? Huawei proposed that service cards of switches should support access control (AC), integrating forwarding, control, and management. However, convergence at this level is far from enough to ensure consistent wired/wireless user experience. We must integrate wired/wireless networks, which complement each other. In-depth convergence of wired/wireless networks will promote consistent and optimized service and management experience for both wired and wireless users.

In-depth convergence allows the wireless network to adopt the virtualization capability of the wired network. In a wired network, an access switch is virtualized into a service card of an agile switch and an access point (AP) is virtualized into a switch interface. The whole network is virtualized into a

switch, greatly simplifying management. In-depth convergence also allows the wired network to

benefit from the maintenance-free characteristic of the wireless network. Since APs are all deployed in high places like roof tops or poles, easy configuration and free maintenance are considered for APs from the start. The WLAN management model can also be adopted in the wired network to make access switches “maintenance-free.” Like an AC managing APs using the CAPWAP protocol, the agile switch can also use the same protocol to manage access switches.

Change #5: Smooth evolution to SDN

SDN was first applied in DCs to enable flexible scheduling of network resources and policies as VMs migrate. There are different understandings of SDN in the industry. We can focus on how SDN evolves to address problems.

Huawei was the first to introduce SDN to enterprise campus networks, which allows flexible network resource allocation and policy adaptation as users roam. The agile network also brings innovation to WANs, branch networks, and DCs.

SDN is used in WANs, greatly improving link utilization. For example, one of Huawei’s large enterprise customers invested billions of dollars in leased lines, the utilization of which was only 30% to 40%. Through the deployment of WAN controllers, the link utilization was increased to over 90%, significantly cutting line leasing fees.

Moreover, many enterprises hope to use SDN without affecting services on existing networks. They don’t want the entire network to become SDN-based. In this case, dual control planes on one switch can be implemented. One physical network can be split into two logical networks – one to run original protocols and services, the other for new SDN services. In this way, customers can have networks capable of smooth evolution to SDN.

The agile network provides forwarding-level, device-level, NMS-level, and controller-based application programming interfaces (APIs) for service orchestration, providing a platform for secondary development and innovation.

The ultimate objective of the agile network is to enable people and things to enjoy distance-free communication, convenient dissemination of information, and effortless communication free from all interference and limitations. The agile network enhances user experience, simplifies network O&M, and maximizes network efficiency. Huawei is committed to providing customers with a fast and flexible network architecture that enables more agile services.

Enterprises must be committed to network innovation in order to tackle current as well as future service challenges. Innovation, once begun, never ends.

Editor: Morgan timothymorganhatrick@huawei.com

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C hanges in the way people communicate in the 21st century have created major challenges for telecom operators. The building, maintenance and upgrade of infrastructure are all very

capital-intensive, with shorter equipment lifecycles and operators’ stagnant revenues further complicating things.

Establish policies to encourage infrastructure investment

In the heavi ly-regulated ICT industry, today’s fragmented regulatory regimes add unnecessary costs for infrastructure operators. Greater standardization in areas such as spectrum and technology would help reduce the cost of R&D, network deployment and operation.

Spectrum costs currently represent a significant portion of the entire mobile infrastructure investment, exceeding 20% in some countries. This definitely deters mobile network investment, and by extension, market competition. Regional differences in spectrum utilization add another layer of cost. Today, the United States and Asia-Pacific region have different frequency usage models, a pricy divergence.

The Next Generation Mobile Networks (NGMN) Alliance sensibly recommends that an additional 500MHz of spectrum be al located to International Mobile Telecommunications (IMT). Countries and governments must create a healthier spectrum allocation mechanism

Building Tomorrow’s Digital InfrastructureTo balance the needs of the future with the pressures of today, three things will need to happen – agreement on regulatory and industrial policies that encourage future infrastructure investment, reduction in the total cost of building and operating networks, and a new level of industry collaboration where infrastructure is shared to maximize economies of scale and ROI.

By Ken Hu, Deputy Chairman & Rotating CEO, HuaweiScan for mobile reading

Ken Hu, Deputy Chairman &

Rotating CEO, Huawei

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that reduces the cost of spectrum acquisition, and regulators should further improve spectrum utilization through better standardization processes.

From a technology perspective, competing standards exist for 4G networks, requiring a range of more complex equipment and handsets to be designed and built to work with all of them. As we move towards the development of 5G, converging today’s LTE FDD and TDD into a single LTE-Advanced (LTE-A) standard would be a key stepping stone towards the goal of global network harmonization.

Policies and regulations should encourage growth and create a healthy market environment to enable all stakeholders to invest in digital infrastructure.

Reduce the cost of network infrastructure

The industry is rapidly approaching a period where the distinctions between fixed-line access (fast and reliable, but static) and wireless access (slower and less reliable, but more flexible) are diminishing. We can now transmit data over high-speed wireless networks (3G, LTE and, in the near future, 5G), allowing infrastructure operators to use wireless technology exclusively for access and fixed fiber networks for core and regional super-networks.

Wireless access is cheaper and faster for an operator to deploy than fixed access. With wireless speeds expected to reach 10Gbps over 5G by 2020, operators can begin to rely on mobile access to significantly reduce overall infrastructure costs. Small cell technology in the home and business will also help boost wireless connection speeds in areas where coverage remains an issue.

Networks are traditionally hardware-driven, making them expensive and inflexible. Today’s software-defined networks (SDNs) will allow operators and their enterprise customers to automatically provision services and balance traffic more efficiently, reducing both CAPEX and OPEX. In tandem with self-organized networks, SDN will simplify network maintenance, thus reducing operating expenses even further. The implementation of voice over LTE will unify voice and data networks, driving down costs even more.

In addition to reducing the cost and improving the efficiency of new network buildouts, operators need to start looking for opportunities to shut down legacy networks. GSM or 2G networks, with their very limited data capability and diminishing revenues, continue to

incur significant maintenance and repair costs. Japan has already responded by shutting down its 2G services.

Infrastructure sharing is also fundamental to reducing costs. Site acquisition and civil engineering are significant deployment costs; sharing of civil engineering such as ducts, towers and power lines can reduce them significantly. Governments, international organizations and industries need to develop more reasonable policies and standards to promote cross-industry collaboration and reduce cost.

Enhance collaboration both within ICT and across industries

There is a need for industry collaboration to harmonize technology globally so that economies of scale for digital infrastructure are maximized, with market fragmentation avoided. This will require vendors, operators and the entire system to intensify their cooperation to maximize synergy.

For evolving cloud-based services, we need common global standards for the technology architecture. Industry players from both the traditional IT and telecom fields must commit to robust cooperation that creates a more transparent and interoperable cloud environment, and ensures sound growth for the ICT industry.

Development of the industry value chain requires synergy between the device, network and cloud. Affordable devices, and a wide variety of applications for individuals, households and enterprises will not only be the driving force behind broadband network development, but also the purpose of it.

For mobile services, the industry needs to migrate 4G (LTE FDD and LTE TDD) to converged LTE-A. 5G should have a single standard, and 5G and next-generation Wi-Fi standards should use the same or a very similar physical layer technology. This requires cross-sector collaboration that includes the likes of semiconductor companies as well as telecom equipment vendors.

The opportunities ahead for the ICT industry have never been more exciting, but the element of the future that is the least clear (the network) has a central role to play in this evolution. The decisions made today and over the next few years will leave an indelible mark on the future of society, as well as the industry itself. The industry must tread carefully but deliberately, with new models, new rules and new principles for a new future.

Editor: Jason jason.patterson@huawei.com

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The digital divide

The way forwardAt Huawei’s Global Analyst Summit 2014, a panel of industry experts was convened to discuss the digital divide, what is being done about it, and what should be done about it. A course of action emerges for industry and government if one considers carefully the salient points the panelists raised – study what the unconnected want, lower the costs of providing it, and commit to providing it.

By Jason Patterson

Where we are now

A ccording to Tomas Lamanauskas, Head of Corporate Strategy at the ITU, “In the last years, we have had mobile broadband (MBB) growing at

an average of 40% each year, with 817 million of the one billion new Internet users over the past four years coming from the developing world. So there is progress there, but is it enough? Should we stop? No, I would say very firmly that we still have 4.4 billion unconnected, two-thirds of the people on the planet, which translates to 1.1 billion households. Now out of those 1.1 billion households, 90% are in the developing world, so there’s a clear divide there. I think that we are going in the right direction, but there’s still a lot to be done.”

He continued by adding, “Our recent studies show that there are 200 million fewer women online than men. And again that is a gap that shows tremendous potential for bringing everyone online that could have tremendous impact in terms of GDP growth, in terms of opportunities and other things. We also have people with disabilities; there are one billion people in the world living with some sort of disability, around 80% of them are in the developing world. How do you make sure that the technology is there for them and

how do you make sure that the technology helps them overcome life’s challenges?”

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Affordability is still the biggest challenge

Cost is of course a pivotal issue in the developing world where, according to Lamanauskas, a PC-based broadband subscription can consume more than half of the average monthly income in certain parts of Africa. But the issue extends far beyond. Lamanauskas noted that subscription costs about 1.5 to 2.0% of the average income in the developed world, but with inequality on the rise, the word “average” is losing its utility when it comes to income. About 40% of lower-income households in Australia lack access to broadband, according to Laurel West of the Economist Intelligence Unit (EIU), with affordability cited as the primary issue.

According to Niall Dunne, Chief Sustainability Office at BT, “Many people who are still offline (in the U.K.) are either in social housing or they are elderly and/or have a disability.” Such people are usually living on a modest and/or fixed income, if they have any income at all, and their numbers will only grow in a world of better medicines, longer lifespans, and stagnant wages.

What can be done to bring down prices? The telco industry needs to find ways to monetize its data traffic, and lower the cost per bit by any means necessary – software-defined networking (SDN), cloud, HetNet, you name it. Industry also must improve user experience through intelligent buffering, cache, and various other means, as it is very hard to maintain low prices for some market

segments unless premiums can be justified to others. Governments also have a role to play in taming the

costs of connectivity. Mobile broadband (MBB) will play a greater role in connecting the unconnected than it did in connecting the now-connected, and spectrum can be the single largest factor in how much MBB costs to the end user. Spectrum is often viewed as a cash cow rather than a socioeconomic enabler. This makes the finding of alternative cost models a must, supplemented by policies that discourage the pricing and hoarding of spectrum like prime real estate. This may be hard for cash-strapped governments to accept, but they should bear in mind that high spectrum fees actually discourage market competitiveness and innovation, thus hindering economic growth and social development. A change in this area would amount to a government investment, one where a modest sum is exchanged upfront for swollen tax coffers for years to come.

Couple this with other policy measures such as telco buildout coordination with utilities (U.S. fiber deployment costs could drop 30% if paired with road construction) and ICT tariff reduction & subsidy, and costs for connectivity should ease.

An ability to commitThese measures wil l certainly make for a more

dynamic market, but history teaches us that ubiquitous infrastructure will never come about through market forces alone. Commitment is needed from all stakeholders. In

We still have 4.4 billion unconnected, which translates to 1.1 billion households. Of those households, 90% are in the developing world, so there’s a clear divide there.

– Tomas Lamanauskas, Head of Corporate Strategy at the ITU

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fact, West thinks that businesses and government cannot simply wait for broadband demand to emerge before they commit to supply. “I think the example from the U.K. about the government getting ahead of the general populace really indicates the way of the future. It makes so much sense for governments and for business to go completely digital, in terms of the lower cost of the services that they provide.” In other words, if governments and businesses get ahead of citizens, citizens will be motivated to catch up.

As to the digital divide itself, Tomas Lamanauskas had some good news. “When you look at the government side, we have now 146 countries that either have national broadband plans or are in the late stages of having one, and our research shows that this does matter. The countries where you have national broadband plans enjoy 7.5% higher penetrat ion for mobi le broadband. And if you look in the broader community, there’s a lot of commitment. In Dubai at the World Telecommunication Development conference, we had a very clear commitment from all the member states to recognize broadband as a key tool for socioeconomic development and also put specific actions in place to actually bridge the divide and bring people online. Also from various other stakeholders, we see various initiatives being launched by various private stakeholders. There are alliances that actually look for solutions and provide some options to connect people.”

He added, “I think that at the end of the day it’s not about a mere social problem; it’s about business opportunity as well. There’s a huge business opportunity that remains untapped. Some years ago, we were looking at mobile as a luxury service that you could only afford in rich countries, but then we saw that

all the growth and revenue was coming from other countries where ARPU was a few dollars per capita, so that means that solutions can be found. People are creative enough to find them. I am optimistic that we are going in the right direction.”

Cat videos aren’t for everyone

The fact that we are heading in the right direction in terms of coverage is certainly good news, but there are still some major gaps that have received little to no attention thus far. One was illustrated by Laurel West, who stated that, “In the U.K., 21% of the population doesn’t know how to use email or a search engine or how to conduct a transaction online. And so policymakers think that a lot more effort needs to be expended in terms of teaching people about the usefulness of the Internet and how it can change and improve their lives.”

Yes, a lack of digital literacy is part of the problem, as is a lack of general knowledge about how the Internet can change your life for the better, but there is an even bigger problem – a lack of applications and content that a previously-unconnected person would find intuitive and compelling, coupled with what is now an imperfect model as to how to sell it.

Roughly 90% of the world’s unconnected live in the developing world, but there’s very little content being generated there outside of the BRIC economies, and even less in minority languages. Furthermore, if you happen to be illiterate, conventional web design is pretty much impenetrable. Sites aimed at the previously unconnected need to be much simpler, without seeming condescending, and coupled with reliable text-to-speech functionality or

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I think the government getting ahead of the general populace really indicates the way of the future. It makes so much sense for governments and for business to go

completely digital, in terms of the lower cost of the services that they provide.

– Laurel West, Economist Intelligence Unit (EIU)

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other alternative forms of UI. The ICT industry also needs to shift its public image

away the from “geek chic” sensibilities that have ruled since the late 90’s towards the more utilitarian sensibility that had previously prevailed. In other words, tech needs to become more of a tool again and less of a fashion or lifestyle statement. Broadband access is now being referred to as a basic human need, nearly on par with food, water and shelter. However, broadband access is not presently viewed like tap water; it’s viewed as an expensive latte, and often sold using a techie formula that a lot of people aren’t comfortable with. Students, hipsters, and the upwardly mobile of all stripes love this formula, but the elderly can’t digest it, low-income people can’t justify the expense, and disabled consumers can barely get themselves in the door. Something needs to change.

A tricky task

Replicating what the first-movers are doing to bridge the divide is unimaginative and risky. What works in the U.K. might not work in Uganda. Stakeholders need to both engage and experiment in their own markets, and really get to know what it is that the unconnected like, want, and need. Telcos don’t always need to reinvent the wheel in order to get their foot in the door of an unconnected household. Sometimes they just need to give its residents what they want.

But determining what the unconnected want is a very tricky task. Beyond the obvious difficulties that stem from the fact that the unconnected are, in fact, not connected, telcos must resist the temptation to overplay the CSR angle here, as not everyone will be comfortable on the

receiving end of what may seem to them like charity. An even bigger hurdle is the fact that some unconnected audiences view the connected lifestyle with derision, or worse, some audiences could view broadband access as a tool of cultural assimilation or hegemony. The way to avoid these traps is grassroots content, evangelized by local talent, with connectivity itself sold not as a ticket to a better life, but as simply a tool to improve the life that you have.

Such careful tailoring of both the medium and its message will require telcos to consider carefully their unconnected and connected audiences, and Laurel West has noted a potential gap here. “One thing that is possibly missing is that the industry needs to take a closer look at their customer base and just who they are serving. Industry must determine just what it is that they really need, what they can pay for, and how it can really be brought altogether and made to happen. I think there’s quite a large gap that can benefit.”

Niall Dunne said something similar. “What is required of business is to actually understand those social issues [underlying the digital divide] and to feed that insight into how you innovate and shape the technology so that it can work for those [unconnected] people.”

What does all this mean for telcos? It means that they cannot simply launch a low-cost brand with an ethnic-sounding name and expect the digital divide to bridge itself. They must do their homework, make friends in the communities they serve (or hope to serve), and be willing to commit to a more personal and less technology-focused approach for the long term. If they can do this, and governments do their part, the digital divide will prove less divisive.

What is required of business is to actually understand those social issues underlying the divide and to feed that insight into how you innovate and shape the technology

so that it can work for unconnected people.

– Niall Dunne, Chief Sustainability Office at BT

Editor: Joe joe.kelly@huawei.com

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3G transformed the industry from voice-based to data-based; this made vendors and application service providers the trendsetters of the industry. As LTE gains ground, data services are giving way to experience-and value-based services. Profound integration and transformation have become the order of the day.

By Li Changwei

Rules, opportunities, and challenges of LTEFrom traffic monetization to experience monetization

I n 2012, the U.S., Japan, and South Korea started large-scale LTE deployments. The networks, technologies, terminals, and applications have all matured. LTE deployment has transformed the ICT

industry in these countries. First, LTE changed user behavior. In the U.S. for

instance, in 2010, the average traffic consumed by 3G (HSPA) users each month was about 450MB. Just two years later, LTE customers were averaging monthly traffic consumption of 4.6GB, a tenfold increase. The service scope also expanded to include SNS/user-generated content (UGC), video, and online to offline (O2O) services. As a result, user experience was greatly enhanced. LTE can handle HD video content that 3G cannot effectively support, including live streaming of games from the National Football League (NFL).

Second, LTE exacerbated homogeneous competition and led to market segmentation. The market was quickly restructured; powerful players gained enormous profits

while weaker ones were eliminated. In the LTE era, telecom competition is increasingly OTT-centered. In the U.S., Japan, and South Korea, there were even cases of larger but slower telcos being gobbled up by smaller, but quicker ones. Operators first to launch certain services can quickly gain users, especially high-end users, and achieve market segmentation. In the U.S. for instance, beginning in August 2011, Verizon deployed advanced LTE networks over a period of 18 months, boosting its market share to 33% and regaining its number one position. In Q1 2013, Verizon’s revenues increased by 6.1% and profits by 19.4%. Meanwhile, telcos slow to launch LTE services did not fare very well; Sprint even got acquired.

Large-scale LTE deployment accelerates transformation to a digitized society and makes the mobile Internet the dominant networking model. More and more traditional fixed network services are available on the mobile Internet. Enterprise services and vertical industry services such as health care, education, transportation, security, and government are increasingly accessed via mobile devices. These services cannot be properly supported by traditional 3G networks due to insufficient network speed and bandwidth, as well as high latency. However, much more powerful than the fixed network, LTE can support these services with ease. Currently, Verizon focuses on helping the power, transportation, medical, and education sectors in their strategic transformation. The

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are the fittestCooperative players

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focus of telcos’ competition has shifted from user experience to value creation.

Competition for users, data services, and O2O

The new evolution rule of competition in the mobile broadband and mobile Internet era requires businesses to focus on customers, have deep insight into customer needs and innovate accordingly in order to satisfy them. This process involves analysis of users, data services, and capital flow services.

To win more subscribers in the future, carriers need to build powerful SNS/UGC platforms. Carriers also need adaptive multi-service platforms to deliver optimal service experience. Ultimately, carriers can roll out the freemium pricing strategy by which products or services (typically digital offerings such as software, media, games or web services) are provided free of charge, but money (premium) is charged for advanced features, functionality, or virtual goods. Capital flow service will leverage O2O to become the major business model in the future that will cover all the value trade activities of users.

Facebook and Tencent have both dominated SNS in their respective markets. Apple Store, Google Play, Youtube, and Netfix have built multi-service and video platforms, dominating the data service market. Amazon and Alibaba have dominated O2O, replacing traditional banking, insurance, and shopping services at an increasing rate. All in all, those who can build platforms to support analysis of users, data services, and capital flow services will dominate the mobile Internet markets.

A carrier needs SNS to win more users. With a large subscriber base, carriers can develop a multi-service platform and rich video contents to boost share in the data market. Using the multi-service platform and big data analytics, carriers can then create new business models to dominate O2O and capital flow. Besides, customer

requirements are constantly changing and competition for users, data services, and capital flow services depends on ever-enhancing and improving platforms.

Mutually benefical cooperation

Industry evolution is a gradual progressive process. So is ICT integration. Successful cases demonstrate that to conduct business transformation, carriers must use their resources as advantages while implementing the “resource monopoly + innovation” strategy and the “platform + openness for cooperation” model. Carriers can take advantage of telecom resources to build open platforms for cooperation. Alibaba’s “OTT + big data + O2O + logistics” platform is an example worthy of emulation. Platform competition is essentially a competition for users, data services, and capital flow services.

Carriers’ survival and development depend on cooperation along the industry chain. Due to waves of innovation, cooperation must be added to the traditional market ingredients (network, terminal, content, pricing, and channel). Without cooperation within the industry chain, no player can survive. The cooperation rules are determined by players’ resources and innovation capabilities. If carriers propose cooperation themselves, they can still integrate resources to pave the way for transformation. If they refuse cooperation, they will be driven out of the market by homogeneous competition. There are five distinctive phases of industry development based on win-win cooperation.

Phase 1 (2007-2012): Innovation of smart devices changed industry rules and became the differential factor in user experience and market dominance. Apple, the leading smart device vendor, dominated the industry chain by establishing the major cooperation model “Apple + first-class carriers.”

Without cooperation within the industry chain, no players can survive. Rules are determined by players’ resources and innovation capabilities. If carriers propose cooperation themselves, they can integrate resources to pave the way for transformation. If they refuse cooperation, they will be driven out of the market.

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Phase 2 (2013-2017): More and more vendors produce their own smart devices. Innovation in OTT services is the key to differentiation. The cooperation model is “OTT players + first-/second-class carriers.” In developed markets, OTT service providers cooperate with first-class carriers in developed markets and second-class carriers in developing markets to improve service experience and create value. Famous examples include cooperation between China Unicom and NetEase, and between China Telecom and Alibaba. American carriers also cooperate with Facebook, Twitter, and Amazon, while major Japanese carriers cooperate with Line.

Phase 3 requires the building of telecom platforms for open cooperation, maximizing the values and capabilities of telecom resources. Vodafone’s OS strategy and Telefonica’s One IT/One Process strategies are all based on network resource openness and use SPs/CPs to create new value services. Meanwhile, carriers integrate the latest OSS, BSS, internal IT support systems, and external IT service platforms. By developing big data analytics and other IT capabilities, carriers gain insight into customers’ on-demand requirements and schedule resources to meet customers’ individual real-time requirements in every scenario. Carriers can adopt accurate pricing policies to realize revenue and profit growth as users and data rates increase exponentially. During the process, carriers can work closely with IT companies to achieve win-win outcomes.

The key driver of profit growth in phase 1, 2, and 3 is telecom services, especially in phase 3. For phase 4, carriers need to achieve business and profit growth in new areas beyond telecom services. During phase 4, carriers should take advantage of their rich telecom resources to provide bundled cloud services so as to seize business and enterprise markets. For example, AT&T’s bundling cloud service model of “FTTx + DC + security + app management” enhanced the algorithms and applications

of cloud services and realized value growth in international markets. Cloud solutions, the merging of service sectors, and cooperation are the themes of phase 4.

Phase 5 is the ultimate model of “OTT platform + micro-innovation.” In this phase, strategic partnerships are of the utmost importance. In Phase 5, telecom platforms no longer exist; they will have evolved into OTT platforms like those of Amazon and Alibaba. OTT platforms support SNS, video contents, and financial services.

In summary, market evolution is progressive and methodical. Carriers need to form partnerships with other players in order to survive and prosper.

Innovation for transformation and continuous development

Change is the only thing that is constant; innovation is a company’s eternal core competence. Whether upgrading platform capabilities, developing new technologies, or replacing traditional service models with new solutions, carriers always rely on innovation for transformation.

They need to learn from successful innovation systems and mechanisms. They need to learn new customer experience and value migration theories and tools to improve customer insight and social marketing capabilities. They must cultivate a gene for innovation centered on customers.

By identifying industry development trends, rules, and directions, all parties of the industry chain can better formulate plans and strategies, and implement them. All parties must seize the opportunities ahead or give up. The winners and losers of the next 20 years will be decided by every player’s ability or inability to adapt. The mobile Internet era is a turning point for all, especially for carriers.

Tao of Business

Telcos need to learn from successful innovation systems and mechanisms. They need to learn new customer experience and value migration theories and tools to improve customer insight and social marketing capabilities. They must

cultivate a gene for innovation centered on customers.

Editor: Morgan timothymorganhatrick@huawei.com

AUG 201435 36

We are living in a mobile broadband (MBB) era where incremental MBB advancements continuously offer us more. New smart terminals and apps constantly spring up, attracting an increasing number of MBB users and generating big data. The infrastructure that supports the surging user population and big data consists of over 500 MBB networks scattered around the world.

By Wang Yixiang, President of Huawei GSM & UMTS & CDMA Networks

UMTS is the lion’s share

A ccording to the latest statistics from the Global System for Mobile Communications Alliance (GSMA), 70% of telcos worldwide have their own 2G (GSM) and 3G (UMTS) networks,

30% also have LTE. Enabled by the development of these three technologies, telcos are discovering real synergy between them. Huawei has a deep understanding of all these technologies, and how to leverage them for different purposes.

UMTS supports most MBB users

The 3G industry chain is quite mature with 3G MBB networks deployed across the world and covering a huge number of users. In fact, a 2013 report by Informa shows that UMTS supports 1.5 billion people (90% of all MBB users). And yet this figure is projected to grow 60% annually. By 2018, 4.3 billion people will subscribe to UMTS.

Most mobile terminals support UMTS

All mid-and high-end smart phones and most low-end mobile phones as cheap as USD50 support UMTS. All told, roughly 4,700 types of terminals support it, making it the dominant MBB system.

UMTS is a major MBB revenue source

For most operators, voice revenue is dwindling while data revenue is surging. The average revenue per user of 3G is significantly higher than that of 2G. Therefore, it is essential that telcos optimize UMTS operation since

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UMTS: A well that never runs dry

that’s where the money is and because their long-term development depends on it.

In view of the MBB subscriber base, the number of terminals supported, and strong revenue generation, UMTS is the champion of voice and data services in the MBB era.

Wang Yixiang

AUG 201437 38

3G is still driving MBB development

UMTS networks were first put into commercial use in 2001, but large-scale worldwide deployment did not take off until 2005. In certain countries in Asia, Africa, and Latin America, UMTS construction started as recently as 2008, so UMTS is still a big market with great potential. UMTS can empower MBB development in terms of subscriber expansion, service experience improvement, and spectrum resource utilization.

Migration to 3G

3G users may boost carrier revenues, but Huawei has found that free-for-all migration polices are detrimental to telcos. Based on our global network O&M experience, we propose innovative migration methods for different user segments so that telcos can enjoy a needed revenue increase and reduced financial pressure.

2G users can be classified into three types – 2G users using 3G smartphones; 2G feature phone users who consume a lot of data; and 2G feature phone users who consume little data. Carriers should apply different migration policies to these three groups.

For the first group, operators can simply send prompts via SMS or provide new SIM cards for free. The second group contains a large number of potential 3G users; operators should offer preferential pricing packages and low-priced smartphones to encourage these users to use more data services. For the third group, no specific migration policy is needed; instead, they should be allowed to migrate or not on their own. As a whole, these differentiated and targeted policies aim to migrate 2G users to 3G step by step, alleviating telcos’ financial

pressure and minimizing impact on existing networks. Huawei not only enables differentiated migration

policies; it provides an end-to-end (E2E) user migration solution. Huawei’s Performance Report System (PRS) allows telcos to devise precise marketing plans. It also features accurate network coverage and capacity prediction to ensure that base stations are deployed where needed most, improving telcos’ ROI. Huawei’s rich business consulting experience allows telcos to develop customized smart terminals and work out localized pricing packages and promotion strategies. So far, Huawei has successfully helped over 40 carriers worldwide migrate users from 2G to 3G.

xMbps bandwidth anywhere anytime

Network construction in the MBB era must be centered on customer experience as well as on key performance indicators (KPIs). While there is no agreed upon definition of what good experience is, Huawei defines it as “xMbps bandwidth anywhere anytime.” This is based on a study of current networks that aims to set a scientific standard for network construction.

Data services are varied and demand different traffic rates; 300Kbps is enough for web browsing, while 1Mbps is enough for smooth 480p video streaming while 720p HD video requires 5Mbps bandwidth to ensure a good viewing experience.

A bandwidth of 300Kbps can ensure a good service experience for only 50% of services, making it definitely unacceptable to users; 3Mbps enables a fairly good user experience for 90% of services, meeting most users’ requirements in most cases, but 5Mbps, on the other hand, ensures satisfying experiences for 95% of services, but this requires a 1.5-fold expansion from 3Mbps, and is very costly and perhaps unnecessary. In the end, the “xMbps

As of the end of 2013, approximately 100 telcos in the world had deployed UMTS 900MHz refarming. These telcos

will be joined by about 100 more by the end of 2015.

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bandwidth anywhere anytime” standard was created in consideration of both user experience and return on investment (ROI). Carriers can achieve “xMbps bandwidth anywhere anytime” as follows:

Enhance coverage & eliminate blind spots: Networks must cover all areas that have traffic requirements so that users can move freely, with a signal strong enough to penetrate walls and other obstructions. Only then can users perceive and enjoy ubiquitous wireless services. Using low-frequency spectrum such as UMTS 900MHz, carriers can deploy ubiquitous wireless networks with minimum investment. They can also leverage all-in-one base stations to ease site acquisition and reduce the costs of site construction and O&M as these stations place few requirements on towers, antenna feeders, site rooms, and air conditioners.

Carrier aggregation: As more and more terminals support Dual Carrier (DC)-HSDPA, telcos can aggregate two carriers for one user through a mere software upgrade, doubling data traffic rates for cell edge users (CEUs) without new base stations. What’s more, 3C-HSDPA and 4C-HSDPA can triple and quadruple data traffic rate for CEUs, respectively.

Small cell deployment: 80% of traffic is generated by macro-cell hotspots and simply deploying more macro cells in a certain area is inefficient. To make things worse, 90% of MBB traffic is generated indoors, and macro-cells are an inefficient means of indoor coverage. Hetnets composed of macro- and micro-cells, and Wi-Fi can effectively absorb and offload MBB traffic.

Software-based enhancement of utilization & capacity: Software upgrade and leverage can boost network capacity at minimal cost. For example, IC/Turbo IC can boost uplink capacity by 40% and there are several channel optimization techniques that can be combined to increase downlink capacity by 20%. Control Channel Parallel Interference Cancellation and Continuous Packet Connectivity (CCPIC/CPC) can double the number of connections, effectively preventing signaling and connection storms.

UMTS 900 refarming and 900/2.1G dual-band

GSMA statistics indicate that by the end of 2013, approximately 100 telcos had at least started to refarm UMTS 900MHz, and they are expected to be joined by about 100 more by the end of 2015. This makes UMTS 900MHz/2.1GHz dual-band an industry standard.

UMTS 900MHz is most effective and efficient in enhancing coverage breadth and depth. It also boosts UMTS network capacity, and can off load

UMTS 2.1GHz traffic. For telcos with declining 2G subscribership and business volume, UMTS 900MHz refarming is a great way to improve spectrum utilization and drive business growth. However, its viabil ity depends on several factors.

The UMTS 900MHz ecosystem must be mature. Currently, over 90% of UMTS terminals support 900MHz, so most subscribers can benefit. Second, efficient GSM 900MHz techniques such as interference-based channel allocation (IBCA) and voice service over adaptive multi-user channels on one slot (VAMOS) ensure that network capacity is still sufficient when available GSM 900MHz resources decrease, thus guaranteeing stable operation of the 2G network and minimal impact on user perception. Mature software-defined radio (SDR) technology also facilitates UMTS 900MHz refarming by reducing the number of radio modules and overall site complexity, making for substantial reductions in OPEX.

UMTS facilitates better service experience, and attracts more users; as the fundamental network for mobile broadband, it has been successful the world over, and is clearly the very foundation of MBB development.

Editor: Morgan timothymorganhatrick@huawei.com

AUG 201439 40

Meeting broadband targets

Operators and policymakers are interested in promoting the dep loyment o f h igh-speed fixed broadband. For

its provisioning, you have three flavors – copper, coax, and fiber.

Fiber to the home (FTTH) is of course the most capacious and future-proof solution available, but it’s laborious and expensive. Brownfield operators will typically choose to reuse infrastructure whenever they can. Fortunately, coax and copper (with a few upgrades) are fully capable of keeping up with bandwidth demands over the last mile, at least for the forseeable future. A pivotal technology here is fiber to the distribution point (FTTdp), where fiber runs from the central office to some point near the customer’s premises, and the remainder is served by legacy media, with a possible upgrade to fiber later.

Certain operators see a G.fast upgrade for copper as a feasible solution for FTTdp scenarios, and various operators, governmental and regulatory bodies, and analysts are interested in knowing the cost implications of the deployment of FTTdp with G.fast. This article examines the deployment costs of FTTdp with G.fast in certain scenarios.

Possibilities for G.fast

The necessary permissions for indoor fiber deployment can lead to long launch times for broadband service. A municipality or a residential association might give the initial permission to run fiber to the building, but more permissions

might be needed to reach the individual dwellings themselves. With FTTdp, that second step could be eliminated.

The distribution point in question with FTTdp will vary with the legacy hardware and the topography on site, leading to a variety of scenarios under this rubric. They include fiber to the street (FTTS), fiber to the building/basement (FTTB), fiber to the door (FTTD) and fiber to the floor (FTTF). For the latter, the distribution point is located on a floor/level of a multistory building with copper running to each individual unit.

G.fast is a high-speed technology for copper that theoretically enables a combined transmission rate of 1Gbps in the downlink and uplink channels, spanning over 100 meters. Currently, its standardization process is being finalized by the International Telecommunications Union (ITU) Study Group 15 (SG15) and commercial availability is expected by late-2015 or 2016.

The joint usage of FTTdp with G.fast can provide a high-speed downstream transmission capacity alternative to FTTH for difficult areas. An operator could, for example, deploy a heterogeneous network, where the feeder and distribution segments are shared by FTTH and FTTdp networks, with either technology employed over the last meters.

Cost of FTTdp rollout

This article compares the capital expenditures (CAPEX) and operational expenditures (OPEX) for two FTTdp scenarios (FTTdp-building and FTTdp-street with G.fast) with that for FTTH in select European countries, including all the passive and active infrastructure located between the central office

Fiber to the distribution point (FTTdp) permits the reuse of legacy copper, and several operators are considering employing G.fast (a technology that promises ultra-broadband speeds over copper) with FTTdp for high-speed fixed broadband. This article illustrates three scenarios and the projected costs in certain European markets.

By Juan Rendon, Huawei Carrier Solutions DepartmentScan for mobile reading

Costs of deploying FTTdp with G.fast

Juan Rendon

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AUG 201439 40

and the end user’s premises. The cost calculation was made using average values taken from different deployments of fiber-based networks in Europe. The cost analysis of these simulated scenarios will help to gain a better understanding of the cost differences between the network architectures.

For the FTTdp network architectures, it was assumed that a distribution point unit (DPU) cabinet would be used. For FTTS, the DPU cabinet would be located in the street somewhere close to the end user’s premises. For FTTB, the DPU cabinet would be located in the basement of the building in question. The DPU cabinet would contain a splitter, the DPUs, and an internal main distribution frame (MDF). There would also be a DPU for each FTTdp subscriber connected. A reverse power feeder (RPF) would be located in the subscriber’s apartment supplying power to the DPU for each user.

The fiber-based segments for all would use Gigabit Passive Optical Network (GPON) architecture. There would be two splitting levels – a 1:8 located in the street cabinet and a 1:4 located in the basement for FTTH or the DPU cabinet for both FTTdp scenarios. It was assumed that in the in-building segment for both FTTdp scenarios, and in the drop segment for FTTdp-street, the legacy twisted pair would be reused.

Figure 1 illustrates the results of the cost analysis with CAPEX and OPEX for one connected home. In all scenarios, the operators were assumed to have 60% market share. Urban, suburban and rural areas were considered for the analysis, which assumed a completely greenfield scenario for all infrastructure, including the passive elements in the feeder and distribution segments.

The results of the cost analysis show that for the three scenarios, FTTdp-street is less costly than FTTdp-building, with the latter costing less than FTTH. On average, the cost of FTTdp-street was 12.4% lower than the cost of FTTH, with the cost of FTTdp-building on average 3.5% lower than that for FTTH. In other words, for the results

presented in this article, it can be said that the farther the fiber is from the user, the less costly it is to deploy.

The potential savings are significant in rural areas, but greater in suburban areas, and greater still in urban areas. This was because the lengths of the feeder and distribution segments, which account for the majority of the total costs, were longer for the non-urban deployments.

Conclusions

G.fast is a technology that enables telcos to treat copper as a high-capacity alternative to FTTH where the deployment of fiber is difficult. Hence, FTTdp networks with G.fast are included in the strategy of several operators that intend to reuse copper lines. The results presented in this article, based on average values of hypothetical scenarios in Europe, show that the deployment cost of G.fast can be lower than that of pure fiber-based networks.

Editor: Jason jason.patterson@huawei.com

On average, the cost of FTTdp-street was 12.4% lower than the cost of FTTH, with the cost of FTTdP-building on average 3.5% lower than that for FTTH. In other

words, the farther the fiber is from the user, the less costly it is to deploy.

Figure 1 Cost per home connected, CAPEX and OPEX, 60% market share

6,000

USD

5,000

4,000

3,000

2,000

Urban

FTTHFTTdp-buildingFTTdp-street

Suburban Rural

1,000

0

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By Jason Patterson Editor: Julia yaohaifei@huawei.com

MegaFon is in the midst of a massive undertaking – a single optical transport network that spans from China to Germany. A bridge between the East and the West, if you will. What is most significant about this link, beyond the fact that this land route is inherently more reliable than the undersea cables that global communications largely depend on, is the fact that guarantees can be made on an unprecedented scale and level of convenience, giving “end-to-end” a whole new meaning.

Hong Kong to Frankfurt in 88msMegaFon’s DREAM

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A new silk road

R ussian telco MegaFon is carrying out an unprecedented network buildout, under the clever acronym of DREAM (Diverse Route for European and Asian Markets).

When asked for details, Carrier Relations Director Alexander Teremetsky stated that, “Traffic volume transferred from Europe to Asia grows every year. Russia is located between two major economic centers, which create a logical conduit for traffic transfers between Europe from one side and Asia (China, South Korea, Japan) from the other side. MegaFon’s backbone route passes through Kazakhstan, Russia, and three other countries in Eastern Europe before ending in Germany. The length of the DREAM route is 8700km from Frankfurt am Main to the Kazakhstan/China border. DREAM will be used for the transfer of all types of telecom traffic between Europe and Asia and has a potential traffic transfer capacity of up to 8Tbps.”

When asked about who MegaFon sees as benef i t ing f rom this project arrangement, Teremetsky answered, “Our project mainly focuses on leading international European and Asian telecom operators. By having a flexible approach in providing channels from 1Gbps up to 10Gbps capacity, our product can attract not only telecom operators but also large B2B customers that require minimum traffic delivery delay from Europe to Asia. Therefore, we hope that our DREAM project may be included in portfolios

By having a flexible approach in providing channels from 1Gbps up to 10Gbps capacity, DREAM can attract not only telecom operators but also large B2B customers that require minimum traffic delivery delay from Europe to Asia.

– Alexander Teremetsky, Carrier Relations Director, MegaFon

Alexander Teremetsky

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MegaFon’s business partners can now provide a real competitive advantage for their customers. Financial institutions, online traders and Internet companies can respond faster to any market changes.

of major international operators who will then sell it to their B2B customers. We already have several such companies connected to the DREAM infrastructure.”

The three primary advantages of DREAM over alternative routes are speed, flexibility and reliability. When asked which advantage was most important, Teremetsky chose the latter (in fact the “diverse” part of the DREAM acronym refers to the fact that it offers an overland alternative) as he considered the conditions in place with the DREAM route far more reliable than the rough & tumble world of undersea cables.

A hard-knocks life

Long-haul undersea cables are absolutely vital to the global economy, but they are surprisingly vulnerable to disruption; about 100 to 200 of them break each year. Most of these disruptions are manmade, caused by boat anchorage or fishing activities, affecting only a single line and thus going largely unnoticed by the average Internet user. But natural causes can be a whole other thing altogether.

On the night of December 26th, 2006, an earthquake struck off the southern coast of Taiwan that damaged eight undersea communications cables that link various parts of Asia. This editor, who was living in Taiwan at the time, remembers this incident vividly as I happened to travel to Hong Kong the very next day on an unrelated matter and, much to my surprise and chagrin,

had my SIM card rendered totally useless by the disruption for most of December 27th, leaving me unable to contact friends whom I was depending on for a place to stay that night. Not only did the quake ruin my day, it ruined the days of telcos and financial institutions all around East Asia, and Internet delays were felt for weeks afterwards.

Fortunately, disruptions of this scale are relatively rare, but unfortunately, undersea network bottlenecks in seismic hotspots are not rare enough, and the increasingly integrated nature of the global economy will make the next major disruption far more costly. MegaFon’s alternative route is all the more attractive because it provides 8700km of overland connection across areas of little to no seismic activity.

Every millisecond helps

The other major advantage of DREAM is speed. According to Alexander Teremetsky, “DREAM is the most efficient traffic route having the shortest round trip delay between Frankfurt am Main/Hong Kong section. The round trip delay here is only 175 versus 195ms from other operators.”

That makes for ten milliseconds saved each way, enabled by ultra-long-haul dense-wavelength divis ion-duplexing (UHL-DWDM) paired with coherent technology. What can those ten milliseconds get you? Quite a lot if you play the stock market.

High-frequency trading, on the order of 3000+ trades per second, is an integral element of global

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finance (estimates have stated that 60 to 73% of U.S. equity is moved through such trades). A ten millisecond advantage at such a speed gets you an extra 30+ trades. Would financial houses pay for such an advantage? You bet. According to Bloomberg, trading firms are known to pay to have their servers placed in the same data center as the relevant stock exchange the shares are trading on, shaving an infinitesimal yet vital amount off of the elapsed time; every little bit helps, and not just a single type of customer.

According to Teremetsky, this speed advantage means that “MegaFon’s business partners can (now) provide a real competitive advantage for their customers. Financial institutions, online traders and Internet companies can respond faster to any market changes.”

A one-stop experience

MegaFon refers to the DREAM network as a “one-stop shopping experience.” When asked to elaborate, Teremetsky said, “MegaFon is the sole supplier to the capacity customers throughout the entire DREAM route, from commercial collaboration issues, to service support and SLA.” Given the fact that six countries are traversed a long th i s backbone network , that would certainly seem to simplify things, but the story does not end there; the China section of the route, which ends in Hong Kong, though not owned by MegaFon, is still guaranteed by the operator in terms of bandwidth diversity and the

other relevant factors. This degree of end-to-end integrity makes MegaFon no longer just a regional player, but in fact a global one, even more so once the alternative route through Scandinavia is added. With both online, DREAM will prove a vital artery of the global economy – an agile innovation serving agile innovators.

When asked about what DREAM means to MegaFon, Teremetsky declared, “Before 2013, MegaFon did not have a Europe-Asia traffic transit capacity segment present in its product range. Now, having closed this gap, we can confidently state that MegaFon has become a full-fledged player on the international transit market. We hope that our DREAM project may be included in the portfolios of major international operators who will then sell it to their B2B customers. In fact, we already have several such companies. DREAM is a significant growth factor for our carrier business. It is one-of-a-kind on the market.”

About MegaFon

MegaFon is a leading Russian operator of mobile 2G, 3G and LTE. As of April 20, 2014, MegaFon has the largest LTE network in Russia, providing services in 53 of the country’s 85 regions and accounting for more than 40% of the population. On February 25, 2014, the company put its LTE-Advanced Cat.6 into commercial use in Moscow which, according to the Global Mobile Suppliers Association, is the fastest commercial mobile data network in the world, reaching 300Mbps.

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By Jason Patterson Editor: Julia yaohaifei@huawei.com

Telcos have been improving our lives since the first telephone lines went up, but in recent years, they have been usurped in terms of perceived import and goodwill in the public consciousness by more nimble OTT players. However, according to Michael Joseph, in developing markets, there is a way for telcos to regain mindshare – mobile money.

Making it work

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Mobile money

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A transformative agent

M -Pesa is the world’s most successful mobile money program in most ways that can be measured (number of participants, amount of money

transacted, percentage of GDP accounted for), but according to Michael Joseph, CEO of Safaricom during M-Pesa’s meteoric rise in Kenya and now in charge of Vodafone’s efforts to reproduce the program in other markets, this is a rather superficial way of looking at it. In a recent interview with WinWin magazine, he credited three inventions as having the most transformative effects on Africa over the last one hundred years – automobiles, mobile phones, and M-PESA.

Reasonable people can certainly debate M-Pesa’s relative import compared to other inventions, but there is no doubt that M-Pesa has been transformative in Kenya and other markets where it has found success. When asked about how a Nairobi resident might have sent money home to his family’s village before M-Pesa, Joseph stated, “You gave it to a bus driver in an envelope and asked the driver to drop it off in the town that he was driving to. You went to the post office. You went to the banks, or you traveled. You took a taxi or you took a bus and that was how you took your money home. It was generally expensive. It was generally slow, and it was generally insecure.”

M-Pesa allows money to be sent with the push of a few buttons, which profoundly improves the lives of developing world citizens, but its transformative effects extend beyond that. Joseph also pointed out that, “In previous times, if you look at Africa, a lot of the economy was in the grey – always done through cash and not recognized by anything. M-Pesa

We made it work. It didn’t just happen. It was a massive effort to make it work. We had to change everybody’s SIM card. We had to persuade people to register customers and to operate the system. It was not easy.

– Michael Joseph, Director of Mobile Money, Vodafone

brings all of that money velocity, making it officially recognizable and recordable so that the central banks, the IMF, can recognize the true economic value of a country. Before, they did not see all of these things. Now, they can determine what a country is, not just by its official receipts, but by its total mobile money transactions. So, I think it changes a country, for sure.”

Right place, right time?

There are over 200 mobile money programs deployed worldwide, but only about a dozen of these programs have over one million accounts, so either a lot of carriers are doing it wrong, a lot of markets just aren’t suitable for it, or both. With this in mind, it’s easy to think that M-Pesa’s success in Kenya has simply been the result of an extraordinary alignment of favorable elements. Safaricom was already in a tremendously dominant position when it launched M-Pesa (over 80% market share). The Kenyan people were relatively comfortable with mobile phones already (mobile penetration was in the low fifties, well above the mid-thirties developing-world average at the time), and a lot of them were unbanked (80% or more). Joseph agreed that conditions were definitely favorable in Kenya, but he stressed that M-Pesa was definitely not a case of “if you build it, they will come.”

“We made it work. It didn’t just happen. If you speak to anybody from my team at that time, it was a massive effort to make it work. We had to change everybody’s SIM card. We had to persuade people to register customers and to operate the system. It was not easy.”

When asked if anyone, including himself, had the foresight to anticipate M-Pesa’s success in Kenya,

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You have to be a trusted and reliable brand to persuade people to give you the little money that they have. It’s not an easy sell, and this is why it has taken so long for mobile money to takeoff in other markets around the world.

he said no. He also reiterated that the dominant use for M-Pesa, as a means of transferring monetary remittance between people, is actually rather different than the simpler means of microloan repayment that Safaricom had in mind when M-Pesa was launched. In other words, the Kenyan people adapted the program to suit their needs – a sort of grassroots innovation demonstrating that telcos should be more open to experimentation, especially in the developing world.

What’s the formula?

Despite M-Pesa’s success, Joseph would agree that mobile money is something that a telco should definitely not treat like an experiment, as such a mindset basically goes against the three factors that he considers critical to making mobile money work.

Factor #1: Total buy-in

In Joseph’s words, “You need total buy-in across the whole company. From the CEO down, you need absolute buy-in. Not lip-service, but absolute buy-in.” Joseph gave a couple of hints during the interview as to why this is the case. One was that telco CEOs (and thus telcos in general) could consider things like mobile money to be something of a distraction from their core business functions. Joseph himself admitted, “Mobile money is not a telecoms product. It’s a financial services product.” He went on to say, “What we are used to in the telecoms world is that we come with a new product, a new idea and we advertise it on TV, on radio, in the newspaper, and then we put it on the shelves and people come and buy it from you.

That’s the way it generally works. But with a financial services product, you have to persuade people that this is what they need. And this is a different selling skill, a different marketing skill, and you have different ideas that you have to give to the customer.”

Joseph implied another reason why total commitment is necessary when he explained how, with the average telco service, if it doesn’t start turning a profit within six months, it is discarded. M-Pesa, despite its enormous success, took roughly three years, according to Joseph, to turn a profit in both Kenya and Tanzania. What’s interesting about this figure is that the Tanzania launch came a year after the Kenya launch, so despite all the lessons that were no doubt learned during that first year, Vodafone was unable to accelerate the maturation process significantly in Tanzania, despite it being right next door to Kenya (a GSMA report would attribute difficulties in Tanzania to it being less developed and less densely populated than Kenya).

Thus, it is probably fair to say that mobile money is an investment only for the patient; an investment without shortcuts, and thus the need for commitment.

Factor #2: A trusted brand

In Joseph’s words, “You have to be a trusted brand. You have to be a reliable brand. You have to persuade people to give you the little money that they have and trust you with their money. It’s not an easy sell, and this is why it has taken so long for mobile money to takeoff in other markets around the world.”

Thus, the take-home lesson from this is that perhaps only the incumbents, and only the reliable incumbents among them, should wade into mobile

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money, as you need a strong track record and you need plenty of boots on the ground, as implied by the third factor.

Factor #3: A big distribution network

Mobile money is electronic, but you still need physical outlets where customers can register, cash in, and cash out. These might be a telco’s own outlets, but the majority of agents, in the case of M-Pesa, are simply small “pop-up shops,” garages or other small businesses. According to Joseph, no telco has enough outlets for mobile money to succeed. “You need a lot (of agents). You need them on every corner, in every town, in every village. It takes an enormous amount of effort to manage that.” This is not hyperbole, at least in Kenya. There are now roughly 80,000 M-Pesa agents in the country; that’s one for every 500 people, added at a pace of about 30 agents per day since M-Pesa’s launch – a tremendous commitment.

One other thing

But of course, a mobile money program will go nowhere without regulatory cooperation. According to Michael Joseph, some regulators worry about whether mobile money is a threat to the banking system, but given the small amounts of money being moved around, this is really not the case. Mobile money complements the conventional banking system; it does not replace it. A primary reason why banks have to charge more than telcos to move money around is because banks are under more pressure to turn a profit from the transaction itself, while telcos typically regard mobile money as more of an investment than a revenue stream, leaving them free

to provide financial services to those who otherwise might not receive them.

Other regulator concerns about mobile money revolve around money laundering, consumer protection and fraud. Mobile money is meant to be convenient, but the less physical presence a mobile money system requires of its users, the greater the potential for abuse. Some regulators have stringent “know your customer” requirements for financial agents that can make mobile money slower to implement, but M-PESA already involves “know your customer” checks in all its markets, with the other basics covered as well in the forms of regular monitoring of transactions, as well as limits per transaction and per day.

A value to the customer

Mobile money is frequently pitched to telco executives as an anti-churn instrument, but its effects can be felt far beyond. According to Michael Joseph, USD1.3 billion is transferred person-to-person in all M-Pesa markets per month, an impressive total considering that the average transaction is less than thirty U.S. dollars.

But Joseph sees mobi le money as about something more. “It’s not just the success of the number transactions or what you can do with it; it is what it does to transform a customer’s life. If you have a product that is so useful and so valuable and so well loved by the community, this changes the way in which you look at your marketplace and allows you to become more valuable to your customer. And I think more and more mobile operators are beginning to see this.”

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By Joyce Fan Editor: Morgan timothymorganhatrick@huawei.com

From one-on-one to one-to-many, from offline to semi-online to online, mobile communication has changed the way tourists prepare for and enjoy their journey. Ooredoo Maldives CEO Haroon Shahul Hameed is in the business of satisfying high expectations, in spite of challenging geography.

Mobile changes tourism

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Ooredoo Maldives

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Sharing: One-to-many & online

A s of 2013, Ooredoo Maldives, the second largest operator in the country, covered 182 islands with 3G+ services and launched the countr y’s f i r s t

commercial 4G service. The operator’s CEO, Haroon Shahul Hameed, believes the data network that they are building will completely transform how tourists experience their vacations.

Enjoying the beaches, reefs, resorts, and water activities, there are plenty of moments that tourists want to share with their familes, friends and colleagues. As Hameed explained, “In the past, sharing was one-on-one. You would write a postcard, or you would speak to your close friend to explain the experience after you went back. Today, we share one-to-many. Via a simple SNS click, you share with as many people as you want.” Sharing has quickly evolved from offline to semi-online to online, thanks to the evolution of mobile broadband and smart terminals. In the past, scuba diving centers used to charge tourists big bucks for pictures of their underwater adventures, but Hameed has noticed a change. “These days, people go diving or snorkeling with good smartphones and underwater cameras, and then upload the videos and pictures to social networks immediately when they go back to the resorts. I see people using

cameras with SIM cards to share their moments in real time.”

Hameed believes that more and more content will flow to telco’s networks in the future. People will enjoy their vacation, and at the same time, they will also enjoy sharing the experience. Ooredoo is accelerating the sharing.

Trip preparation: Do it yourself

With 1,192 beautiful coral islands, the Republic of the Maldives is one of the world’s premium tourism destinations. In fact, more than half of the country’s 200 inhabited islands host a resort. On average, tourists spend about USD13,000 during a visit which typically lasts from seven to ten days. The expense is significant, so it’s all the more important that visitors find the islands that offer the features they desire.

Ten years ago, people went to a travel agency and received one-stop service – air tickets, resorts reservation, activities, and everything. However, the information available was never comprehensive and choices were limited. Thanks to the reviews, pictures and videos shared by other tourists, people now have abundant direct information about the islands and the resorts, and what special offers might be available. Tourists are increasingly acting as their own travel agents. They can directly contact

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local resorts as well as local transportation services that provide transportation between the islands.

For the local travel service providers, mobile broadband is a business enabler. Hameed explained how broadband services are helping to promote the Maldives as a tourism destination, “When the tourists are coming and sharing their beautiful moments with the world, they are promoting the country.” He also noted that currently, Ooredoo Maldives has covered 84% of the country with 3G services and close to 50% of the handsets on their network are smartphones, which has actually helped many entrepreneurs to become travel agents and travel advisers. Such agents and advisors don’t need much capital to start their small businesses.

Premium telecom services: A challenge to deliver

Hameed believes that people spending large amounts of money in the Maldives expect a high quality experience in whatever they do, and today, telecom is an important part of almost every experience. He shared several statistics on how his company is helping tourists to enjoy their experience – Ooredoo Maldives now covers 99% of the Maldives with 2G networks, and 84% are covered with 3G+ networks. More than one-third of the population have access to 4G networks.

With 1,192 islands spread across 90,000 square kilometers of sea, in the Maldives, achieving these levels of coverage isn’t easy.

The extreme majority of operators in the world build their networks for the local customers. They do not invest anything special for roaming customers, but do extract some revenue from them. With only 320,000 citizens, but 800,000 tourists annually, the Maldives is an exceptional case. Hameed told us that Ooredoo deploys their networks case by case. “In the Maldives, we have inhabited islands with certain needs, and we have resorts that have a completely different set of needs. We actually set up customized telecommunication infrastructure specifically for the resorts, the tourists and the roamers.

“The number one requirement of the resorts is to have a fantastic high-end data experience. However, the towers we deploy determine the coverage area, and those have to be harmonious with the environment – extremely beautiful and not higher than the trees on the island. Even in smaller resorts, we had to deploy more than one cell site to cover the entire resort. It’s already done and it was expensive.”

But this is not the end of the story. The Maldives are a haven for pampered tourists who enjoy a top-notch experience when they go diving, snorkeling, fishing and travelling throughout the resorts; it’s no surprise that they expect a similarly high-quality communication experience. As Hameed put it, “It’s

Not only lands have to be covered. We need to cover every area where tourists go so they can capture all their moments. Service & operational costs are very high and teams need to travel 200km by speedboat to keep sites running.– Haroon Shahul Hameed, Ooredoo Maldives CEO

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not only the lands that have to be covered; we need to cover every area where tourists go so they can capture all their moments. Of course the service and operational costs are very high and our teams need to travel 200 kilometers by speedboat to keep these sites running, but we want the tourists to go back home with beautiful memories of the Maldives, so we invested quite heavily in creating this state of the art telecom network.”

Not only tourism

While tourism contributes about 30% of the Maldives GDP, fishing is also a major part of the economy. Therefore, in addition to the core telecommunication services for the tourists, Ooredoo developed special services for the fishing boats, which roam around the islands.

Hameed talked about the system his company deployed for the local fishermen, “We created devices that provide tracking and emergency signaling features to support people when they are on the water. Fisherman can carry the tracking device so that the operational center always knows where they and their boats are. All these tracking devices have an emergency button, so if they face an emergency when diving or fishing, they can always press the button. Distress signals go directly to our operational center and are immediately forwarded to the offices of the ministry, coast

guard, and so on, so that emergency personnel can be sent out to support these people.”

Ooredoo also created a service called Geo-fencing. If a fishing boat ventures beyond the Maldives’ territorial waters, the crew will receive an SMS followed by a call to inform them. “These are some of the services that we have developed to support Maldivian fisherman, and we continue to provide quality networks and differentiated services to the entire country and its visitors,” Hameed concluded.

Milestones of Ooredoo Maldives

2013• Launched the Maldives’ first LTE network for

fixed and mobile broadband in cooperation with Huawei

• Rebranded Wataniya into Ooredoo Maldives while boosting both the customer base and data consumption

2009• Launched the Maldives’ first 3G network

2005• Launched the first data service in the Maldives

using GPRS and EDGE technologies• Launched 2G voice services under the brand of

Wataniya (as the market challenger)

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By Qin Fuqiang Editor: Morgan timothymorganhatrick@huawei.com

Armed with Huawei’s ultra-broadband tri-band antenna, Zain Kuwait deployed a modern LTE1800 network with support for LTE800, LTE2600, and LTE-A evolution. The antennas feature EasyRET, which reduces network O&M expense and enhances RET antenna efficiency and reliability.

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Zain Kuwait’s LTE networkThe antenna: Pinnacle of

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A magnificent jewel, Kuwait sparkles with prosperity, culture, and technology. It is no wonder that Zain, a leading mobile telecom operator in the Middle East

and Africa, chose Kuwait as their headquarters. Zain Kuwait deployed Zain Group’s first wireless network and has been its flagship subsidiary ever since. Today, it is the local wireless market leader, holding a 37% market share while achieving average revenue per user (ARPU) of USD38 per month.

Beginning in 2011, the explosive growth of smartphone use threatened to overwhelm the existing UMTS network. The network capacity was being pushed to its very limit and user experience began to deteriorate. Zain Kuwait rose to the challenge by building a nationwide LTE1800 network, greatly improving user experience. The new network provides high-quality mobile broadband services with a downlink speed of up to 110Mbps.

The antenna solution

Antenna solutions are typically one of the most difficult challenges of LTE network deployment. While the planning is difficult, the potential benefits are significant. With great insight, Zain made antenna system modernization a key task of the LTE1800 network upgrade; the result was

unparalleled LTE user experience.

An antenna ready for LTE800 and LTE2600 evolution

With the introduction of new bands, antenna systems are becoming increasingly complex. Many wireless sites (including radio masts, towers, and mobile telecommunications vehicles) for Zain’s network antennas have significant space and weight limitations. While antenna costs represent a small fraction of network investment, during network upgrade, the costs of antenna modernization are actually quite high – higher than the cost of the hardware itself. With an eye on the future, Zain required a solution that would be ready for network modernization and evolution. In addition, they wanted to be capable of meeting growing network demands during the next few years while avoiding the usual costs of antenna modernization. Their plan included maintaining maximal return on investment (ROI) while ensuring uninterrupted network operat ion. LTE800 and LTE2600 networks will inevitably launch in the next few years to supplement the capacity of the LTE1800 network; with tri-band antennas already in place, Zain will be ready.

LTE network optimization is costly & difficult

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Zain’s existing network featured many types of sites, each with different weight-bearing capabilities. Antennas were provided by various vendors, and used different parameters for band, gain and bandwidth. This made modernization a real challenge.

To provide the best user experience, a network needs to be constantly optimized to improve capacity and coverage. LTE networks require more network optimization than GSM and UMTS networks. LTE cells are sensitive to interference from neighboring cells because they operate on the same frequencies. Furthermore, indoor, outdoor, and small cell networks must be properly coordinated in order to maximize coverage area and capacity.

In the past , Zain Kuwait used non-RET antennas for network optimization. A tower worker had to climb a tower to adjust the antenna’s mechanical tilt, a difficult task in Kuwait’s blistering heat. Each antenna adjustment incurred additional expense, which meant that network optimization was more expensive than the procurement price of RET antennas. To ensure accurate network coverage and reduce cost, Zain chose the remote electrical tilt (RET) antenna for their new LTE network.

Diverse conditions onsite

Zain’s existing network featured many different types of sites, each with different weight-bearing capabilities. The antennas were provided by various vendors, and used different parameters for supported band, gain and bandwidth. This made the modernization solution a real challenge. Traditional antenna vendors could not provide sufficient solutions to help quickly build an LTE

network to divert traffic from the overloaded UMTS network. Zain Kuwait was determined to improve customer experience and attract new customers, so they made finding a solution a top priority.

Antennas are the pinnacle of LTE networks

To address these problems, Zain conducted trial tests of products from major antenna vendors and selected Huawei’s ultra-broadband tri-band antenna (790-960/2x1710-2690MHz) for network modernization. This tri-band antenna supports LTE1800, LTE800, and LTE2600 networks in addition to GSM900/GSM1800 networks. It also supports carrier aggregation (CA), which is needed for evolution to LTE-Advanced (LTE-A). This antenna is supported by the EasyRET solution, which allows independent and remote antenna tilt adjustment for each band. Therefore, separate electrical adjustment devices don’t need to be installed and workers don’t need to climb towers. This solution also increases the reliability of the antenna system.

Quick delivery of LTE

In 2012, Zain asked Huawei to conduct site surveys, solution planning, and to coordinate

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equipment preparation and delivery of antennas and other main dev ices . Huawei achieved quick project delivery and reduced end-to-end procurement cost for Zain. Huawei’s robust global logistics network achieved speedy delivery to site, ensuring that Zain rapidly established the largest LTE1800 network in the Middle East. The load of the UTMS network was immediately alleviated and user experience was enhanced.

EasyRET: Reduced O&M, increased reliability, efficient optimization

With the EasyRET solution, manual antenna tilt adjustment becomes history. EasyRET enables independent and remote antenna tilt adjustment for each band, a l lowing real-t ime network optimization at minimal expense.

Since EasyRET did not require Zain to install remote control units (RCU) and AISG cable, 45 minutes of installation time was saved at each site. In addition, there was no need to configure RET data and RCU serial numbers, saving another 20 minutes per site. The EasyRET antenna solution features three instead of 15 external connection points, reducing the complexity of manual operation and hence improving RET reliability.

After two years of outdoor operation in the desert sun, Huawei’s EasyRET antenna maintained high reliability with zero failures. The LTE network performance is also improving through continuous

optimization.

One antenna deployment to meet long-term evolution requirements

Huawei’s ultra-broadband tri-band antenna supports 790MHz to 960MHz low frequencies and also supports LTE800 and GSM900 through a combiner. This makes the whole antenna system lighter, easing deployment on guyed towers and cow sites. The antenna has two ultra-broadband high bands (1710MHz to 2690MHz), allowing evolution to 4x4 MIMO. In addition, the antenna’s high band adopts side-by-side architecture with outstanding high-order MIMO performance (In an LTE1800 network, the cell edge throughput of side-by-side architecture is 9% higher than stacked designs).

The antenna also adopts the same azimuth for LTE800 and LTE1800 networks, thereby supporting CA of LTE-A. CA can greatly improve network capacity and reduce the operator’s network deployment and O&M costs.

Zain was the first operator in Kuwait to announce the launch of LTE-A services. Their LTE1800 network delivers high-quality and high-speed wireless services such as video conferencing, real-time navigation, HD video-on-demand, and SNS. These services have changed the way people communicate and live; subscribers are now flocking to Zain, whose customer base grew by 8% in 2013.

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By Morgan Hatrick Editor: Jason jason.patterson@huawei.com

Established in 2008, VIVA Kuwait entered a market dominated by strong incumbents. In just five years, they managed to seize a 33% market share despite stubborn resistance from their competitors. We take a close look at how they did it, and what’s next.

The rise of

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VIVA Kuwait

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Make a plan, follow it

L ike many operators today, VIVA Kuwait pays close attention to its core business and to customer experience. What has set them apart from others is their

firm commitment to a strategic plan and knack for decisive execution. After quickly rising to prominence, VIVA intends to hold on to all the gains they have made. They now focus more than ever on customer experience and their core business while depending on outsourced expertise for everything else.

To satisfy the high-tech requirements of their strategic plan, VIVA Kuwait partnered with Huawei. The latter came to the table with a wealth of experience in the region and was able to provide business and network consultation, E2E network solutions, managed services, and devices. In February 2008, the partners acted on their plans and quickly moved projects from one stage to the next, deploying all-IP 2G and 3G solutions that provided a previously unavailable level of user experience. Over the years, VIVA has been able to focus on their core business while Huawei has continued to provide support in other areas.

Customer experience first

As the new kid on the block, VIVA knew they had to differentiate themselves in order to attract attention and win customers. They saw some key opportunities, especially in data, and made precise plans to meet the needs of the Kuwaiti public. They chose to emphasize MBB data services and also offered creative packages that precisely fit the needs of many users who were not sufficiently catered to.

Very early on, VIVA anticipated the importance of data. Accordingly, they deployed more 3G sites and constantly upgraded as soon as possible. They have always raced to provide the best network that available technology will allow. Over time, they progressed from 14.4Mbps to 21Mbps, and then to 42Mbps. In March of 2012, they announced the launch of Kuwait’s first commercial LTE network. More recently, they achieved nationwide LTE coverage.

VIVA constantly fine-tunes their equipment and performs E2E network audits and optimization every year. Apparently, their competitors are no slouches either, because OpenSignal ranks Kuwait’s overall and LTE network quality as 66% and 304%

VIVA’s success is the result of superior technology leveraged in creative ways to deliver the ultimate customer experience. If you effectively market a quality product, you gain market share.

– Eng. Salman Al BadranVIVA Kuwait CEO

better than the worldwide averages, respectively. Although Kuwait’s other carriers are quite good, OpenSignal ranks VIVA Kuwait as the nation’s best when it comes to overall network quality.

In order to guarantee the best user experience possible, and to reduce maintenance complexity and expense, VIVA deployed Huawei’s SmartCare solution in 2013. Never satisfied, they deployed video optimization and dynamic QoS solutions in 2014. Quick adoption of the best technology and

Eng. Salman Al Badran

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VIVA Kuwait offered three months of free service to new customers. This promotion resulted in an explosion of traffic. The load was ten times higher than the network’s guaranteed capacity. Huawei successfully kept up.

solutions has helped sharpen the edge VIVA needed to expand (and maintain) their customer base.

VIVA’s aggressive marketing policies have also helped to increase market share and popularize data services. Through bundled LTE devices and packages that provide unlimited data, free voice, or free data for services like Twitter and WhatsApp, VIVA has established themselves as the carrier of choice for data services. In fact, they handle 70% of all LTE traffic in Kuwait.

When VIVA Kuwait was launched in late December of 2008, the incumbent carriers had already achieved a 100% penetration rate. In such a setting, a newcomer has to offer something extraordinary, or make extraordinary offers, or both. According to VIVA Kuwait CEO, Eng. Salman Al Badran, “VIVA’s success is the result of superior technology leveraged in creative ways to deliver the ultimate customer experience. If you effectively market a quality product, you gain market share. Together with Huawei, we research ways to bring a futuristic experience to our customers. However, technology isn’t enough. While we concentrate on core business, Huawei provides consultation and support in a wide range of areas – devices, financing, and local resources, among others.”

Core business always

VIVA Kuwait’s sole vendor strategy provides a strong set of advantages; obviously, vendor

interaction is simplified, along with the responsibility matrix, the troubleshooting, and solution planning. Agility is another factor – network rollout and solution deployments have been lightning fast, resulting in quick TTM, which really gave VIVA the momentum they needed to grab market share and hold on to it. VIVA Kuwait can focus on core business thanks to wide-ranging support provided by Huawei. This allows VIVA to run a lean operation while possessing strong competence in all areas.

From the start, VIVA Kuwait took Huawei as a primary partner. This simplified and hastened their launch. The cooperation was successful and, over time, it became more comprehensive. When VIVA faced new challenges, Huawei was there with new solutions.

Huawei got VIVA Kuwait into the game quickly by deploying their entire network in just three months. Building on this momentum, VIVA Kuwait became an immediate hit with the Kuwaiti public by offering three months of free service to their new customers. Not surprisingly, this promotion was very successful and resulted in an explosion of traffic. The load was ten times higher than the network’s guaranteed capacity. Taking this as an opportunity to shine, Huawei successfully maintained the network and kept up with the fast rising traffic. As they say, “a good beginning is half the journey.” VIVA Kuwait experienced an amazing beginning, and it paved the way for their continuing journey.

VIVA’s traffic continued to increase at a rapid pace. In 2010, VIVA’s surging popularity resulted

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in traffic that threatened to degrade network performance and user experience. From that point onward, Huawei has been providing annual E2E network audits, enhancement services, parameter adjustments, policy and configuration optimization, RF optimization, traffic management, tariff optimization, and more. These efforts have helped VIVA deal with growing pains and clearly illustrate the value of sole vendor relationships.

As a primary partner, Huawei is in a position to provide solution integration, third-party purchasing, management and maintenance, and so on, reducing costs and avoiding delays for VIVA. As of 2014, even IT infrastructure maintenance has been placed into Huawei’s loving care.

When VIVA was re ady to dep loy the i r commercial LTE network, Huawei was ready – 602 sites were deployed within two months.

In the words of Eng. Salman Al Badran, “The partnership between VIVA Kuwait and Huawei has been mutually beneficial. By advancing customer care strategies and through research of new technology and the innovative application of existing technologies, we have steadily improved customer experience, which is the foundation of our success. This is an ongoing process and will continue.”

Joint innovation is the future

VIVA Kuwait has set an example by focusing on core business while relying on a strong partner

to take care of everything else. Others are now adopting this strategy, but VIVA did it first and therefore benefited first. The superior customer experience that results from this approach is one of the main reasons VIVA has been so successful, so it’s no surprise that they plan to refine and emphasize this approach even more. At Mobile World Congress, March 2014, it was announced that VIVA and Huawei are launching a joint innovation center dedicated to further enhancing customer exper ience and customer service management.

The innovation center will leverage Huawei’s solutions, services, and global consultancy network. It is tasked with creating an improved customer experience metrics system, redesigning organizational work f lows, developing new IT platforms, as well as fine-tuning payment strategies, traffic management systems, and tools for measuring network performance in real time, among other things.

According to Eng. Salman Al Badran, “The experience and global resources provided by Huawei have helped us in the past and will be helpful in the future as well. Our partnership is mutually beneficial, and we both place total emphasis on customer experience, so customers win too – everyone wins.” Having taken the number two position very quickly, VIVA Kuwait has no reason to change their strategy. With a history of stunning success, it’s no surprise that VIVA Kuwait will stick to their proven strategy.

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By Zong Xumei (China Mobile Jiangsu) Editor: Jason jason.patterson@huawei.com

In 2013, China Mobile Jiangsu (Jiangsu Mobile) carried out a TCP-network optimization program that took its previously underwhelming user satisfaction ratings from 21st to tops at China Mobile. For an encore, the operator is optimizing its video service, with even more improvements in the pipeline.

A role model in user experience

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China Mobile Jiangsu

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How time crawls

T here seems to be nothing mobile Internet subscribers hate more than waiting. Roughly 80% of such subscribers have changed their provider at least once due

to a poor data service experience, and 57% of users will simply close an Internet window if it takes more than three seconds to load (for 35% of users the wait limit is six seconds for video). Such responsiveness is not the easiest thing to guarantee outside the lab.

At the beginning of 2013, a user satisfaction survey from Jiangsu Mobile revealed its mobile experience to be its Achilles’ heel. Mobile web browsing was consuming about 60% of its total mobile traffic, but the average mobile web loading rate was 130 to 160Kbps, far below the 1.6Mbps expected of 3G.

Many users were complaining about video freezes and slow buffering, thus dampening their enthusiasm for the medium, and therefore limiting traffic growth, to the tune of a less-than-20% share of MBB traffic for mobile video in that year, a stark contrast to the 45 – 50% average of the major international telcos. A major mobile revamp was needed.

A new era in MBB quality

In the case of Jiangsu Mobile, user experience was far below that expected for the available bandwidth,

so improvement would require more than simple capacity expansion.

TCP optimization

Jiangsu Mobile looked deeply into its mobile Internet transport protocols and service protocols and realized that most mobile applications were based on the Transmission Control Protocol (TCP), which was originally developed for fixed networks. It is not well-suited to the mobile Internet because the typical issues of packet loss and bit error often lead to a false assumption of network congestion, and thus a reduced data transfer speed. Faced with such an environment, Jiangsu Mobile responded by optimizing its transport layer protocol for TCP.

In 2013, Jiangsu Mobile and Huawei’s SingleEPC MSE (Multi-Service Engine) optimization team cooperated on the application of Huawei’s TCP optimization solution for its networks, with the goal of accelerating wireless transmission.

The optimization itself included three aspects. First, “TCP quick start” technology was employed to reduce time spent in transit by skipping the slow-start phase for TCP, which is inefficient and slow. Second, “TCP transparent proxy” technology optimized the two ends of the transfer, enabling timely request response and speedy processing on both sides, while supporting fast recovery or fast retransmission of out-of-order and/or lost packets, to improve overall network throughput. And third, and perhaps the most important, the

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innovative “TCP WEEB algorithm” now prevents the false assumption of network congestion for traditional TCP, thus making data transfer more efficient and improving the overall throughput.

Results for this optimization solution speak for themselves. Jiangsu Mobile’s bandwidth utilization increased by 20%, with significant gains also seen with the mobile access rate and overall network stability. Web-browsing delay was reduced by 15% on average (hitting 30% for some pages) and monthly complaints dropped by 14%. What impressed the most was Jiangsu Mobile’s post-optimization leap in customer satisfaction ranking, rising from a paltry 21st to tops amongst all of China Mobile’s provincial branches. What’s more, the improved service quality both attracted new subscribers and stimulated consumption amongst legacy subscribers, culminating in traffic consumption that was 10 – 15% above the background growth rate, making for a significant jump in revenue. Currently, the solution covers most TD users in Jiangsu province, totaling some 1.5 million online users during peak times, with expansion imminent.

Video optimization

In 2014, Jiangsu Mobile’s cooperation with Huawei has expanded to target video optimization, with the hope of improving video experience through video caching and smart pacing. Numerous tests on the operator’s network have demonstrated that video caching can indeed help deliver a seamless zero-wait video experience in real-world situations. The average initial waiting time for video decreased by 50%, with the average number of video stalls reduced from seven to one, or even zero. What’s more, the smart pacing solution saves 10 – 15% of bandwidth resources for congested cells, making for a significant jump in

utilization efficiency. With preliminary testing now complete, service

cutover for this video optimization solution is now underway, with large-scale implementation expected after June. Next on the agenda will be video transcoding and dynamic bitrate adaption, so that an even better video experience can be had.

Easy and flexible deployment

Huawei’s TCP/video optimization solution is basically a module embedded in the packet core gateway, so no network modification is required. This makes both testing and deployment easy and timely, with network maintenance simplified. What’s more, differentiated E2E network acceleration and flexible policy configuration are enabled, and can be based on service, terminal, user type, access mode, location, cell load, and network status, paving the way for future experience-based value-added service (VAS) operation.

A mobile pioneer

Jiangsu Mobile’s success has not gone unnoticed, with China Mobile now planning to promote the relevant solution across China. Jiangsu Mobile and Huawei have also formed a strategic partnership, with both parties establishing a joint innovation and experience center for building top-quality MBB networks. They will also increase investments in video/web page optimization, ultra-flash circuit switched fallback (CSFB), E2E QoS guarantee, and the development of a traffic toolbar for user experience optimization. This will put the operator at the very forefront of mobile innovation, not just in China but the entire world.

Improved service quality attracted new subscribers and stimulated consumption amongst legacy subscribers, culminating in traffic consumption 10 – 15% above the background growth rate.

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– Zong Xumei, China Mobile Jiangsu

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