Around the World

Posted: March 31st, 2011 | Author: | Filed under: Around the World | Tags: , , , , | 1 Comment »…
Mobile Handset Market in India to Witness Tremendous Growth in Next Five Years [Report]
Aseem blogged about a recent Frost & Sullivan report, which looks at the Indian mobile handset market and the country’s expected mobile market growth within the next five years.  According to analysts, India has reached the coveted position of the second largest mobile handset market in the world after China—it’s expected to become even bigger with 208.4 million phones being shipped by 2016 at a CAGR of 11.4% between the period of 2010 – 2016.

Aseem’s post stuck out to us because Olivier Suard touched on a similar topic a few weeks back.  One particularly interesting fact he noted—last year, India had about 68 mobile handset players, and if Frost & Sullivan’s predications are accurate, it will skyrocket to more than 200!  If this is indeed the case, further competition and the squeezing of profit margins will take place—and OSS can have a major play.

With the proliferation of Web 2.0 and Internet surfing, the use of smartphones is expected to rise in India.  But during subscribers’ switch from ‘dumb phones’ to smartphones, it’s important to maintain a high quality of experience.  For instance, customers using basic handhelds should have the option to select which services they want during activation, and those surfing the web on their mobiles shouldn’t experience slow speeds due to network congestion.

Connected Planet…
Pricing ‘Sweet Spot’ Still Eludes Carriers
BSS/OSS reporter Susana Schwartz discusses the disconnect that has emerged between carriers and customers when it comes to pricing wireless and wireline data services.  Customers are bitter towards the new usage caps and overage fees they feel are being forced by AT&T and other communications service providers (CSPs).  The timing of Susana’s piece comes on the heels of recent stories on customers claiming that their data usage is off.  While the percentage of users generating high data traffic is fairly small, it’s still necessary for operators to figure out—sooner rather than later—how to target those customers with these caps without ‘punishing’ the greater whole of their user base.

Susana points out that there’s no confusion in the messaging about 4G and LTE investments, but relatively little is said about the changes in OSS/BSS environments to ensure services are fulfilled, assured and billed in the most optimal way possible.  If carriers manage to translate this into more consumer-friendly terms—and that provisioning, billing and customer-care systems are more accurate and robust—then perhaps there wouldn’t be so much distrust on the accuracy of the metering of usage and the consequences in terms of caps and overage charges.

Usage-based pricing seems to be the ‘sweet spot’ for operators—taking the approach “you get what you pay for”.  Policy and charging control can accurately identify these customers and the services they consume and bill them appropriately.

TM Forum’s Inside Leadership…
Predictions for 2011: Environmental Drivers of Communications Trends
Rob Rich, managing director of TM Forum Insights Research, shared some global communications trends and predictions for 2011.   He notes that, in general, the growth of communications services is connected to the state of the global economy—and thankfully, the Organisation for Economic Cooperation and Development reported good news for this year; the global economy is expected to expand 4.2 percent.  China and India are expected to lead the larger economies in growth, by approximately 9%and 8%, respectively.  However, developed economies are not expected to perform as well, with the U.S. expected to achieve an increase of 2.2 percent, Japan a rate of 2 percent and the European Union slightly less than 2 percent.

After evaluating the global trends, Rob made some communications industry predictions for 2011—here is a sampling of the ones that struck us:

  • The margin crunch intensifies—fixed line revenues, including for data, are under pressure, and the rapid growth of mobile broadband won’t bring additional revenues, but will continue to require massive investment in network capacity.  Arguably, CSPs’ greatest opportunity is in acting as enabler for other parties in the value chain. In the short term, there is no quick fix.
  • Cloud services approach the mainstream—there’s lots of activity in this area with different companies investing in data centers, computing infrastructure, software platforms and much more.  Only some will see true success, and the Forum expects to see rationalisation during 2011.  They predict the sweet spots will be small- and medium-sized businesses, emerging markets and Software as a Service.  In addition, enterprises will be forced towards the adoption of cloud by financial considerations.
  • Data management and analytics become critical competencies—communications is one of the world’s most data intensive businesses, but the timely and effective use of this data is behind many other industries—a situation that needs to be addressed.  The customer experience can be greatly improved with data management and analytics. This has many benefits including increased revenue, enhanced brand reputation, reduced churn and the extension of the CSP’s role across the value chain. This is especially true when the information is ready in real time. CSPs need to start by figuring out where the biggest payback will be and go from there.

TM Forum members may read the full version of this Quick Insights report on the association’s website.

Keeping a Finger on the Telco Pulse of Eurasia

Posted: March 24th, 2011 | Author: | Filed under: Events, Telecom Trends | Tags: , , | Comments Off on Keeping a Finger on the Telco Pulse of Eurasia

Russia, Turkey and all of Eurasia have great potential for growth, especially in the area of mobile broadband. In general, mobile penetration is significantly lower here than in Western European markets. Since fixed networks are often less developed in these countries, they are depending more heavily on mobile networks. As a result, mobile broadband has the potential to surpass fixed broadband as soon as this year,  and CSPs in the region are looking for solutions for convergence, new revenue streams from value-added services and how to adopt LTE.

One interesting Eurasia telco fact to note: the markets of Central Asia and the Caspian region are often lumped together as “the stans”; however, there is a striking difference between these countries. According to the CIA World Factbook, mobile phone penetration in Kazakhstan is as high as 96 percent, while in Turkmenistan, it is only about 40 percent.

The exciting opportunities in this region have not gone unnoticed. In fact, as a result, Comptel has integrated a new operating structure and divided our European business into two areas, Europe West and Europe East. This move will allow us to focus our efforts on new growth areas, especially in Eurasia, while actively maintaining large customer accounts in Western Europe.

To further immerse us into the Eurasia market, we will be attending this year’s EurasiaCom, Eurasia’s only commercially focused telecoms event, in Istanbul, Turkey on March 29-30. Comptel is looking forward to being a part of this changing environment, as well as learning from and sharing ideas with other leaders in the industry at this year’s EurasiaCom. Will you be attending?

LTE – The Voice Problem

Posted: March 23rd, 2011 | Author: | Filed under: Industry Insights | Tags: , , , , | 2 Comments »

A few months ago, I wrote a blog about whether LTE was breathing a new life into IMS. I received a lot of comments, and that post has been one of the most popular on the “The Dynamics of OSS”. Clearly, I touched a nerve there!

This time, I would like to look at how operators plan to solve “the voice problem” in LTE. Yes, voice! Given the revenue operators still make from voice services, one would have thought they would have made voice a priority. In fact, the focus so far has been almost entirely on faster data. However, the “voice problem” won’t go away.

The problem arises because 2G/3G voice is basically circuit switched, not packet transport. LTE, on the other hand, is all-IP, packet transport with no ‘circuit’ at all. This creates quite a problem for operators when they decide to transition voice from 2G/3G to LTE.

Currently, operators with LTE are considering three options to support voice:

  1. VoLTE (GSMA- and 3GPP-backed Voice over LTE, basically voice services in IMS core)
  2. VoLGA (Kineto Wireless-supported alternative Voice over LTE using Generic Access or UMA also known as unlicensed Mobile Access)
  3. CSFB (Circuit Switched FallBack, prior to Voice over LTE, the 3GPP-backed standard)

As it relates to voice calls, CSFB is principally not LTE at all.  The radio connection is moved to a circuit-switched 2G/3G radio connection (and LTE radio is not on). As a result, data sessions (web surfing, data streaming, etc.) would be cut unless the device has a dual radio mode (LTE and 2G/3G radio on at the same time), which apart from consuming more battery life, this would generally be a bad compromise.

VoLGA is a somewhat of a competing offering by Kineto among others. It proposes to bridge the gap between LTE and CSFB, but would require each handset and device to also support VoLGA. So far, the adoption of VoLGA appears to be limited.

This leaves VoLTE.  VoLTE seems to be the winner, as it is backed by all of the major network and device vendors. However, it mandates IMS back-end core and also forces all services in existence in 2G/3G voice (IN services, prepaid, roaming) to be re-implemented in IMS, which is clearly a big and potentially expensive challenge for operators. VoLTE would support the handover of radio to ensure voice call continuity in a single-radio mode (very good for sparing battery consumption), but some work is still needed in the standardisation for the handover process from 3G to LTE.

LTE could also naturally drive OTT (over the top) voice services (e.g. Google Voice, Skype, etc.) , but the challenge is that the handover to 2G/3G radio would cut the data sessions and disconnect voice. As LTE coverage will most likely not be 100% (at least for most European operators), this will most likely impact some users. That being said, it would only affect truly mobile customers. Nomadic customers, who are essentially stationary, would not have to face that problem and could use OTT services to the detriment of operator revenue.

However, it seems many operators have decided to tackle the challenge by first driving the rollout of LTE by using data only. Then, when coverage and hunger for more data is handled—and handled well—the assumption is that voice can more easily be put onto the network. I’ve heard rumours that larger international groups are building a central IMS core to be shared between their national operating companies (the LTE radio part would remain separate). This would help to drive the business case for IMS, as IMS costs are split between the operating entities. However, sharing IMS rollout costs perhaps will not be available to smaller, independent operators then.

With CDMA, the world is ‘simpler’ as the 3GPP2 standard for handover procedure from LTE to CDMA is not available, and at least Verizon is not even looking into that.

Needless to say, all of this will have an impact on back-end systems, like charging and policy control, as well as service creation and activation, which will require special attention—especially in the complex world of hybrid LTE+2G/3G networks, where services still need to be created and charged for so that they seamlessly work during handovers.

Customer Satisfaction is Important for All Types of Mobile Users

Posted: March 18th, 2011 | Author: | Filed under: Industry Insights | Tags: , , , | 3 Comments »

Last week, I noticed for the first time TelecomAsia’s monthly reporting of Asia’s top 10 selling handsets. I have to confess that I have never paid close attention to handset shipments, so I was surprised by what I saw. Firstly, there are only two suppliers in the top 10: Nokia and Samsung. Secondly, most of the phones on the list are fairly basic, not smartphones. So while we often believe Apple iPhones and HTC Android phones to be ubiquitous that is not the reality on the ground.

To me, this was a reminder that we, in the industry, are often well ahead of the actual market. It is obviously a good thing in many ways, but it’s also important for us not to forget that not everyone in the world owns an iPhone or is a heavy user of mobile broadband value added services.

Consider for example how, when we talk in the industry about customer satisfaction, we often focus on mobile broadband speed and capacity. Yet for many customers, satisfaction comes from much more prosaic factors such as how easily they can get their phone working, how well they can make voice calls or send texts, and how fair and accurate they perceive charging to be.  Looking at it from an OSS perspective, this also means that, while policy control is a very exciting and fast growing area, there is also still plenty of mileage in, say, mediation, charging and provisioning.

The phone shipment statistic reminded me of a demonstration of the Comptel Dynamic SIM Management that my colleague Simo Isomäki gave me recently. He showed me how a subscriber, when they first use the phone, can follow an interactive menu to select the phone’s number, the services they want and the method of payment (pre- or post-paid) –all fairly important factors in the customer experience. He showed me this on various smartphones, but also on a very ordinary phone with a small, text-based screen. When you consider that Asia already makes up nearly 50 percent of the global market in terms of subscriptions, and continues to grow; and given the shipment statistics above, the “ordinary phone” version Comptel Dynamic SIM Management was, in retrospect, probably the most important of all!

Comptel will be exhibiting at Frost & Sullivan’s 5th Annual OSS BSS Asia Pacific Summit, 23-24 March 2011, Singapore.

Around the World

Posted: March 11th, 2011 | Author: | Filed under: Around the World | Tags: , , , , , | Comments Off on Around the World

Cellular News…
Mobile Network Operators Need New Approaches to Make Data Profitable
Editor Ian Mansfield covered a recent Ovum report, Making a Profit from Mobile Broadband Data, which looks at why mobile network operators (MNOs) need to find a smarter approach for managing their networks and charging for data usage.  The report explains that MNOs need to use customer data held in the BSS with policy management and controls in order to manage soaring traffic loads, drive profits, personalise the customer experience and increase their agility and response times.  Clare McCarthy, the author of the report, noted that, “some MNOs have already adopted plans with options such as discounted evening and weekend use or monthly data caps.  However, this approach doesn’t go far enough and only addresses one part of the equation.  It doesn’t maximise revenue potential with high-value customers.”

This is a similar point Bob Machin raised after attending Informa’s Broadband Traffic Management event back in November—the industry has been steadily moving from Policy Control 1.0 to Policy Control 2.0, with the first wave dominated by the need to control (and indeed deter) the use of data services, and the second taking a much more liberal approach which encourages data usage, but aims to flatten out peaks and troughs in demand, spreading usage more evenly across networks, geographies and time spans to allow a much better return.

TM Forum: Revenue Management Community…
Minutes, Seconds – Who’s Counting?
Tony Poulos, BSS strategist and evangelist for TM Forum, blogged on Telstra’s recent move from 30-second billing blocks to one-minute billing blocks.  While the communications service provider (CSP) says this move will bring the company in line with industry standards (and analysts have noted that Telstra will reap tens of millions in revenue from the change), consumer groups are unsurprisingly opposed. They are saying that it will make phone calls more expensive, and that the industry could easily charge in smaller time blocks.  As Tony points out, CSPs generally aspire to one-second billing, and this was pretty much the world standard. From a BSS/OSS perspective, this move is certainly a surprise, as more CSPs are looking to charge in real time and offer more advanced and flexible pricing models to optimise subscribers’ experiences.  What are your thoughts on Telstra’s move?

Light Reading…
Many India Lines Inactive, Finds Regulator
India editor Gagandeep Kaur reported on recent data from the Telecom Regulatory Authority of India and Visitor Location Register, which found that 222.52 million lines (nearly 29%) of the total mobile phone lines (771.18 million) are inactive.  There are a lot of pre-paid numbers that have been activated but used only for a certain amount of time; users likely activate new numbers either with the same CSP or a rival.  In January 2011, Bharti Airtel added 3.3 million new mobile lines to reach a total of 155.8 million—giving the CSP a 20.2 percent share of the mobile market; while Reliance added 3.2 million to reach a total of 128.9 million—giving it a 16.7 percent market share.  The only operator that recorded a reduction from its subscriber base was Videocon Telecommunications; this is believed to be the result of subscriber churn following the introduction of mobile number portability, which was introduced earlier this year.  It will be interesting to see how these figures shape out throughout 2011, particularly because SIM management will play a larger role in CSPs’ OSSs and as India’s wireless subscriber base continues to grow.

Una perspectiva Latinoamericana del Mobile World Congress

Posted: March 3rd, 2011 | Author: | Filed under: Events | Tags: , , , | 1 Comment »

(Scroll down for an English version of the following blog post.)

Otro Mobile World Congress ha terminado. Fue muy interesante poder observar que tantos operadores latinoamericanos habían realizado el viaje hasta Barcelona (y que me mantuvieron muy ocupados con muchas reuniones!) Mientras me preparaba para realizar mi viaje de regreso a Buenos Aires, pensaba respecto de cuales habían sido los temas y discusiones claves del evento y que significa esto para la región de CALA, hoy y a futuro.

Primero, la rápida adopción de Smartphones y Tablets en CALA, con certeza, está impulsando un crecimiento explosivo del tráfico de datos y está teniendo un impacto significativo en la manera que los operadores administran el ancho de banda, las suscripciones y combinan los planes tarifarios. Fue muy satisfactorio poder confirmar (nuevamente) que los usuarios desean pagar por nuevos y avanzados servicios como juegos, música, video-on-demand como así también la alta calidad de experiencia de usuario – obligando a los operadores a desplegar soluciones de Control de Políticas (Policy Control). Al menos la mitad de las más de 120 reuniones que habíamos mantenido durante los cuatro días el evento cubrían este tópico de soluciones OSS.

Latinoamérica todavía se encuentra en crecimiento a un muy buen ritmo en lo que respecta a penetración celular, de acuerdo al Sr. Daniel Hash, CEO de América Móvil (quien utiliza las soluciones de Comptel en cinco operaciones), hay unos 30 millones de personas por sobre los 15 años de edad que van a ingresar al mercado, impulsando el crecimiento hasta los 150 millones de abonados y duplicando la penetración de banda ancha en los próximos cinco años. Administrar todos estos nuevos clientes (y los servicios que se encontrarán disponibles para ese momento) puede definir o cambiar el rumbo de la carrera para ser el operador de servicios líder en la región. La buena noticia es que nosotros estamos más que en condiciones de ayudar a los operadores a alcanzar su meta.

Por último, mientras mi avión se está preparando para salir, me quede pensando sobre la nube (no la del cielo, sino la de cloud computing), que sin duda ya está aquí entre nosotros, y como despegaría en Latinoamérica. Muchas personas de los 20 países al sur del Rio Grande ya están accediendo al contenido utilizando una gran variedad de dispositivos y sistemas operativos distintos. El desafío de maximizar el control operativo y la confianza del usuario sigue sin embargo vigente. Afortunadamente Comptel ya está enfocado en permitir que los proveedores de servicios de comunicaciones puedan gestionar la nube de servicios, no solo haciéndolos posibles, sino también rentables.

Ahora que el Mobile World Congress ha terminado existen algunos pensamientos adicionales que nos hemos traído de regreso a nuestros hogares y que todavía no hemos compartido? Puedes dejar un comentario aquí.

A Latin American Perspective on Mobile World Congress

Another Mobile World Congress is over. It was great to see so many Latin American operators make the trip to Barcelona (and keep me very busy with meetings!). As I was getting ready to travel the 16 hours back to Buenos Aires, I was thinking about the key tradeshow themes and discussions, and what these mean for the CALA region today and in the future.

First, the rapid adoption of smartphones and tablets in CALA is certainly driving explosive growth in data traffic, and having a significant impact on the way mobile operators are managing their bandwidth, subscriptions and tiered service/price plans. It was nice to confirm (again) that consumers are willing to pay for advanced services like games, music and video-on-demand, as well as for a high Quality of Experience—revealing operators’ need to roll out policy control. At least half of the 120+ meetings we had over the four days at Mobile World Congress covered this OSS solution.

Latin America is also still growing at a very good pace in terms of wireless penetration; according to Mr. Daniel Hash, CEO of America Movil (full disclosure: the operator uses Comptel’s solutions in five countries), there are 30 million people over the age of 15 that will enter the market, driving growth to 150 million subscribers and doubling broadband penetration in the next five years. Managing all of those new customers (and the services that will be available by that time) will make or break the race for the top communications service provider in the region. The good news is that we are more than capable of helping operators meet this goal.

Lastly, as my flight was readying to leave, I pondered on Cloud, which is certainly here and taking off (no pun intended) in Latin America. People across the 20 countries south of the Rio Grande are accessing content on a variety of devices and operating systems. The key challenge of maximizing operational control and customer confidence remains. But Comptel has already been focused on enabling communications service providers to closely manage cloud services—not only making them possible, but profitable.

Now that Mobile World Congress has been wrapped up for a couple of weeks, are there any additional thoughts you took home but haven’t yet shared? Leave a comment here.