Active network sharing fails to gain traction

Nipun Jaiswal/Analysys Mason
28 Apr 2014
00:00

Passive network sharing dominates network sharing arrangements in the region. A total of 64 network sharing arrangements have been signed in APAC, and active network sharing accounts for just 14% (nine) of these. Operators in the region are not averse to working together as demonstrated by the prevalence of passive infrastructure sharing, but the complexities of sharing active components of the network remains an insurmountable barrier for many.

Markets such as Indonesia, the Philippines, Singapore and Thailand do not have any active network sharing agreements to date.

Why has active network sharing not picked up in the region? Analysys Mason looks at three key challenges.

Network coverage. Operators' focus on coverage-based competitive differentiation has hindered adoption. For operators, which have invested heavily in their networks for the widest coverage, sharing RAN means diluting a perceived competitive advantage. However, operators have been willing to share capacity in the form of site and mast sharing, especially in dense urban areas where it can be extremely challenging to find new sites, obtain build permission and conduct maintenance.

Regulatory stance. Regulators in most countries in APAC have been indecisive about active network sharing. They have neither encouraged the operators nor discouraged them. They have not released explicit guidelines governing active network sharing as they have done for passive sharing. The regulator in India has allowed active sharing since 2008 but has not allowed spectrum sharing. This restriction on full active sharing does not allow the operators to implement the effective greenfield model of sharing wherein operators share the spectrum and jointly build out a new network.

Operational challenges. Active network sharing involves agreements on a variety of operational parameters. Network governance can become very challenging while deploying and operating the network. Partners may have to jointly agree on key parameters such as "baseband capacity split ratio", handover parameters and what KPIs they should measure to show the utilization/usage of each operator. Joint agreements on such parameters can turn out to be quite complex and time-consuming.

However, equipment vendors have addressed some of these issues in their advanced and customized solutions.

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