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27 Jun 2013

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The Market:
The mobile industry has charted a strong growth path in the area of Mobile Broadband (MBB) as it again reaches new heights in multiple fronts.

At the end of 2012, worldwide smartphone users surpassed the 1.1 billion mark, the penetration rate rose above 17%, and mobile Internet penetration approached the critical 20% breakout point. By mid 2013, LTE which just over 3 years old is forecasted to exceed the 100 million subscription mark.

A key ingredient in supporting the MBB growth is an endless stream of new innovations to push the next wave of MBB growth with OTT services, Cloud Computing, M2M, LBS, NFC and HTML5 just to name a few.

The other ingredient is the end user devices especially smartphones are doing more than communication, delivering information, entertainment and a plethora of other functions. In search for the next big thing, companies are touting the potential of wearable computers like Google’s Glass project.

The Challenges:
In embracing the MBB era, operators are now faced with two main challenges. First, the challenge of every operator CTO is to cope with the ensuing data traffic tsunami, with data traffic doubling annually. Operators face the challenge to deploy a network which can scale to meet the traffic growth while keeping the cost in check.

Next, operator CFOs face the business challenge of dealing with larger contribution from the lower margin MBB service coupled with decreasing contribution from the high margin voice and SMS services. Operators are trying to find ways to grow its topline with new services as well as maintain its profitability level and grow its bottom-line.

The Strategy:
Over the past years, Huawei has gained a strong understanding of the challenges MBB brings through numerous operator collaborations. This is reflected in Huawei’s solutions which are developed solely to help operators to best face and overcome these challenges.

Huawei has, in the past year, helped operators to build best-in-class MBB including leading LTE networks in Canada, Germany, Hong Kong, Japan, the UK and Singapore, and in the process empowering their networks with cutting-edge SingleRAN, SingleSON and HetNet architecture just to name a few.

In developing the network to support the MBB traffic growth, operators typically will go for a phased approach starting with providing coverage, then adding capacity through additional layers and finally through site densification.

Providing optimal coverage is not only for outdoor but more importantly providing good indoor coverage which typically suffers from building penetration loss. Going with in-building solutions, there is the challenge of the high cost and providing 2x2MIMO capability specifically for LTE. Using small cells based RRUs as an alternative to DAS for in-building could be an option to consider here.

Once the MBB coverage is sufficient, there will be strong traffic growth and the network should be scaled appropriately to avoid being CAPEX heavy by building extra capacity and having the network under-utilized. Building a 2 layer strategy with one being the coverage layer with a lower frequency band such as UMTS850/UMTS900 and LTE700/800 paired with a capacity layer in densely populated areas with higher frequency bands such as UMTS2100 and LTE1800/2600 is a practical approach.

Next is to provide site densification by providing capacity to the areas where it’s needed. This is best done through small cells and HetNet architecture. However, to achieve better capacity gain the small cells have to be coordinated with the macro cells to avoid potential interference and improve the capacity gain.

In facing the challenge of MBB monetization, Huawei is working to evolve the current network towards a “Softmobile” architecture. Softmobile is an evolutionary change to the network architecture design to enhance the network capability providing “Openness” and “Virtualization”.
Opening up the network APIs to 3rd party applications would provide operators to better monetize through a 2 sided business model. Network virtualization on the other hand enables an Agile implementation in the network where applications can be flexibly built on top of the network, enabling ICT convergence in both the network and application level. The “Softmobile” architecture will undoubtedly help propel the operators in transforming their business from “CT” to “ICT”.

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