Webinar: Secure and Scale the Gi-LAN at 80% Lower TCO

Mobile network traffic is expected to increase 45% annually with video representing 60% of all mobile traffic. To meet the demand, networks will need to be intelligently and cost effectively scaled for secure services delivery, especially the Gi-LAN. As volumes grow, the number of concurrent users, connection rates, and throughput will all need to scale together. But how can operators evolve their architectures to support this growth while lowering TCO?

Join F5‘s Misbah Mahmoodi, and ACG’s Paul Parker-Johnson and register for this webinar to learn about:

• The market and business challenges IoT devices, applications and the growing number of users are placing on mobile networks.
• The key criteria to use when architecting for massive scale in application delivery infrastructures.
• Three TCO sizing models you can reference to dimension our network performance needs.

Paul Parker-Johnson

pparkerjohnson@acgcc.com 

www.acgcc.com

It’s about APPU and QoE, not ARPU

Traditionally, average revenue per user  has been one of the key metrics used to measure service providers’ financial performance. Increased competition has been putting downward pressure on ARPU, resulting in declining earnings before interest, taxes, depreciation and amortization. In parallel, the volume of data traffic transmitted over wireless networks is increasing exponentially. Global mobile data traffic grew 74 percent in 2015, reaching 3.7 Exabytes per month at the end of 2015, up from 2.1 Exabytes per month at the end of 2014 . This is driven not only by the increase of new mobile applications, but also by the sheer number of connected devices. Smartphone subscriptions passed the billion mark in 2012; the four billion mark is expected to be reached by 2016. There will be more than 20 billion mobile-connected devices by 2020, including machine to machine modules, which will exceed the projected global population of 7.8 billion.

Current cellular networks may not have the capacity to meet this demand and the further expansion of coverage and densification will only add additional capital expense and operation expense without improving ARPU. To improve financial results, SPs must focus on the average profit per user  and look for ways to reduce operating costs while providing additional network coverage.

ACG Research conducted a business study of different technology penetrations on SPs’ networks. The scenario integrated untrusted Wi-Fi, trusted Wi-Fi, and small cell into the cellular network, which includes 2G, 3G and VoLTE voice traffic. The scenario compares different penetrations to identify the optimum plan that will optimize SPs’ APPU. The study found that this is only possible by increasing the amount of trusted Wi-Fi traffic and VoWi-Fi penetration, resulting in higher EBITDA margins and APPU, up to 9 percent, saving $3.83 billion for a 35.5 percent monthly increase of APPU over five years.

Read the entire article at RCRWireless News.

For more information about ACG’s services, contact info@acgcc.com.

Ray Mota

rmota@acgcc.com
www.acgcc.com

5G: The Efficient Engine to Virtual Infrastructure Optimization

Ahead of his participation at TM Forum Live!, ACG Research’s Elias Aravantinos looks at how 5G technology can be the engine to optimize the different parts of the network to enable new, faster and more profitable services.

Infrastructure optimization

In an effort to address the demand for capacity and average revenue per user (ARPU) pressures, service providers are looking at 5G technology as the engine to optimize the different parts of their networks and deliver faster, new and more profitable services. In many cases, they realize that upgrading their physical infrastructure has limitations because of costs and inefficient time to market constraints, and they are looking for solutions, specifically virtualization, that scale their networks to meet the capacity demand while simultaneously delivering business value – savings.

Click to read the TM Forum article.

    

    Elias Aranvantino

    earanvantino@acgcc.com

    www.acgcc.com

WORLDWIDE MOBILE IP INFRASTRUCTURE WILL GROW TO $7.4 BILLION BY 2020

Mobile data, LTE upgrades, all-IP transformation and services, and network modernization are expected to positively impact demand for mobile IP infrastructure

The Worldwide Mobile IP Infrastructure market is projected to increase from $4.5 billion to $7.4 billion by 2020. ACG Research anticipates that the total Mobile IP Infrastructure market will increase 15% in 2016 as well as increase in each successive year. Mobile IP Routing Backhaul revenue will increase 7.1% and Switching Backhaul revenue will grow 1.8% during the forecast period. The Packet Core, both Mobile Packet Core and Evolved Packet Core, will surpass 15% by 2020. Although major LTE roll-outs, mainly in the macrocell layer, were completed in 2015, there is continued pressure for more mobile data capacity as mobile broadband subscribers and smart devices continue to grow. Providers want advanced services such as WiFi calling and VoLTE, fueling the demand for packet gateways, control plane functions and virtualization. LTE Carrier Aggregation, 5G and IoT capacity planning are expected to positively impact demand for mobile IP infrastructure. Vendors continue to upgrade their networks and technologies, as densification will be the key driver behind demand for data, which is expected to increase.

The projected five-year growth will be strongest in the Americas region, CAGR +11.0%, followed by the EMEA, CAGR +10.5%, and APAC, CAGR +9.0%.

“In the next five years, service providers will continue to focus on LTE but also target ultra-network transformation, looking into new architectures that will allow them to capitalize on the existing networks, identify new revenue streams, and deliver high quality of experience, service agility and innovation,” says Elias Aravantinos, mobility analyst. “Service providers are looking at vendors’ solutions that will allow them to not only manage existing networks but also let them transform to next-generation networks with simplicity, scalability and, most importantly, with low failure risk services to preserve service viability and minimize network downtime.”

TREND AND DRIVER HIGHLIGHTS

To address the demand for capacity and average revenue per user pressures, service providers are looking at 5G technology as the engine to optimize the different parts of their networks and deliver faster, new and more profitable services. 

Mobile data traffic and 4G/LTE subs are projected to increase significantly during the next six years with operators responding with faster network deployments to satisfy subscribers’ demand, which is driven by video, for more capacity. 

Data centers, flexible virtualized platforms and new software modules are now changing the traditional physical infrastructure thinking over the next 6 years that will put pressures to operators as they need to manage and maintain both virtual and legacy networks. 

How networks proliferated by SDN and NFV will look in next 3 to 5 years will impact 5G standards and subsequent deployments. New network architectures delivering service agility, such as network slicing and virtual automated platforms, could save time and generate quick revenue.

For more information about ACG's mobility services contact info@acgcc.com.

    

    Elias Aranvantino

    earanvantino@acgcc.com

    www.acgcc.com

Ray Mota Talks NFV with Affirmed Networks & RCR Wireless

This CEO panel, filmed during Mobile World Congress 2016, brings together Hassan Ahmed, Affirmed Networks CEO, ACG Research CEO Ray Mota and Jeff Mucci, CEO of RCR Wireless News. The group discusses the use cases driving carrier NFV adoption and how the NFV landscape has changed in the past year.

Contact info@acgcc.com for more information about ACG's video services. 

Ray Mota

rmota@acgcc.com
www.acgcc.com

The 5G Wave of the Future

Today, congestion plagues low-frequency below 6GHz spectrum bands, which, consequently, not only makes it very difficult to add more capacity but also limits the number of antennas used (no more than two or three antennas).

The landscape, however, is much different in the high-frequency bands, usually known as the millimeter wave (mmW). The channels are much wider, reaching even 250MHz and multiples thereof in some bands (such as E-band), providing the needed capacity for 5G access and backhauling. In general, the mmW can request a wide availability of spectrum, which is a prerequisite for both access and backhaul. More antennas can be used (ranging from 4, 16 or even 32), resulting into beamforming that as it advances to shorter wavelengths allows for smaller antennas (including arrays needed for beamforming and beamsteering). Antenna directivity is much better in high frequencies, allowing a high spectral reuse factor. High-frequency radios can widely be used today and demand will continue to grow, especially for E-Band (80GHz) in dense areas where high capacity is needed. ACG anticipates that the momentum for E-Band will continue and will be preferred for new 5G (by 2020 or earlier) deployments technologies. (One in five links could be E-band in 2020.)

Regulation is the main enabler for high-frequency solutions adoption because by applying different licensing models it could encourage better use of spectrum, weighing in factors such as frequency bands, geographic region, and local microwave hop density. Ericsson recently described the multiband booster method, which could maximize spectrum efficiency, add new technologies that can exploit unused spectrum, and upgrade the capacity of microwave backhaul networks up to tenfold. This is a great option that has been used for years from other leading vendors as well but in most cases is still restricted by regulation.

Introducing and allowing wider channels in less deployed areas would further encourage the use of multiband solutions. Leo Macciotta, Huawei’s Senior Marketing Manager, highlights that “the challenges in capacity and latency requirements posed by LTE-A and in the future 5G make this kind of equipment the best and most cost-efficient choice for a future-proof deployment. Continuous investments in component, system and antenna technology provide a clear and dependable road map of improvement in performance such that we are confident that E-band will become one of the key building blocks of the future front- and back-haul networks for 5G and beyond.”

For access, most vendors could offer high modulation, wider channels, and multiple antennas (MIMO). The capacity offer varies between 2 and 4 Gbps full duplex, although some vendors are testing solutions in the lab that could go up to 10 Gbps in a range of a few kilometers. The MIMO types used today in most cases are 2x2 and 4x4 but could increase much higher along the 5G spec. This is not the case for backhaul; although the MIMO feature is offered, there is no real demand yet, but that might change beyond 2020.

E-band has recently come into mainstream use for mobile backhaul, allowing capacities of up to 10 Gbps over link lengths up to several km (even more than 10 km when bundled with lower frequency bearers) and is currently shipping in volume. Regarding backhauling, Yigal Leiba, co-founder and CTO of Siklu, mentioned that “a capacity of 2 Gbps could be enough today and possibly for the next 2 years for Mobile Operators and specifically for network aggregation layers and major Macro Base Stations backhauling, while 1Gbps street level backhaul could serve effectively Small Cells.” Looking to the future, the industry shares a vision of using frequencies above 100 GHz, as they will enable capacities in the 40 Gbps range over hop distances of about a kilometer but mostly for access. Regarding 5G and backhaul, there is already pressure, and leading vendors and major Tier 1 operators are worried that backhaul requirements may not be kept in the right considerations.

Tying the whole industry ecosystem together is the ETSI mWT (Millimetre Wave Transport) ISG, a common forum for component, subsystem and system manufacturers, telecommunications operators, and regulator. The forum promotes understanding and acceptance of mmW worldwide. With endorsements from such respected groups the future of these technologies looks promising.

    

    Elias Aranvantino

    earanvantino@acgcc.com

    www.acgcc.com

Evolution of Mobile Network Visibility: ACG HotSeat with Sanjay Munshi, Brocade

Sanjay Munshi, Senior Director of Product Management at Brocade Communications, and Ray Mota, CEO of ACG Research, discuss Brocade’s significant new network visibility product announcement: carrier-grade, physical and virtual network packet brokers, virtual TAPs, an SDN based session director and a single pane of glass management application. Sanjay highlights the challenges operators have in 4G/LTE visibility, how to address them in a cost effective manner and the critical need for new, next-generation network visibility architectures as mobile operators ramp up to virtual EPC and 5G with billions of M2M connections and Internet of Things in the not too distant future.

Click for more information about ACG’s video packages.

Ray Mota

rmota@acgcc.com
www.acgcc.com

Tremendous Packet Core Momentum Fuels 2Q Worldwide Mobile Infrastructure Market, Surpasses $1 Billion

LTE-Advanced deployment, Packet Core deployments, VoWiFi trials and the high interest in end-to-end VoLTE solutions are driving the mobility market

The Worldwide Mobile Infrastructure market grew revenue in Q2 quarter over quarter. The Q2 Total Worldwide Mobile Infrastructure market surpassed $1 billion in revenues. The APAC region, mainly China, led this growth during this quarter, followed by EMEA. Mobile broadband net sales were primarily driven by overall radio technologies, specifically LTE. In the North American region the market managed to stabilize, helping most vendors to maintain flat revenues. Although most operators have completed their LTE deployments, it is anticipated that the fast-rising data traffic will definitely require further upgrades of U.S. wireless networks to add more capacity and avoid congestion experiences such as those recently witnessed in New York and Chicago, and generate opportunities for vendors.

Global mobile infrastructure spending posted single digit growth with most carriers adopting a “wait and see” status for new deployments and services. However, Packet Core, specifically EPC, grew in double digits and it is expected this growth will continue in the next quarters as operators modernize the network with new services. We anticipate more spending into EPC but also into virtual solutions, vEPC, in the coming quarters as the trials will start scaling up into commercial accounts. Services virtualization continues to gain traction because of the savings and the short time to market service delivery. More VoLTE and VoWiFi deployments are expected in the next quarters as most operators understand that these services are complementary and offer different benefits for indoor and outdoor support.

“There are three interesting points to note this quarter. The focus of Mobile IP Infrastructure spending has shifted to the Asia-Pacific region, coming mainly from China; the Evolved Packet Core market is the fastest growing segment. This trend will maintain momentum in the next quarters, and it will gain traction even more in North America with significant LTE network expansions,” states Elias Aravantinos, principal analyst, ACG Wireless and Mobility.

“The second point relates to another interesting trend related to the previous trend, the large scale of virtual service trials that are becoming commercial because operators have realized the savings and the advantages when virtualizing certain parts of the network. The first commercial Virtual EPC projects are expected to massively scale by the end of 2015. Finally, there is special focus on Voice over WiFi service adaptation and spending on the Evolved Packet Data Gateway or ePDG, which is a native part of this new infrastructure and ensures the call connectivity between the WiFi and the cellular network. Operators have already understood that there is no competition between VoWiFi and VoLTE and that these services complement, helping them to face coverage, traffic offload and churn issues,” says Aravantinos.

Click for more information about ACG’s mobility services or contact information@acgcc.com.

    Elias Aravantinos

    earavantinos@acgcc.com

    www.acgcc.com

The Time Is Now for NFV

Traditional network architectures based upon purpose-built network appliances and the resulting complex manual and proprietary systems interfaces used to support a rapidly increasing diversity of network appliances have been identified as the root causes of high-cost, poor capacity scaling, and long deployment and innovation cycles. This is affecting the sustainability of network operators’ business models. As a result, network operators have launched their NFV initiatives to overcome the limitations of traditional network architecture. NFV is explicitly designed to reduce cost, and increase network scalability and agility. 

ACG’s whitepaper shows that the common platform approach is uniquely able to support a sustainable business model through implementation of NFV and that appliance-based and NFV custom vertical software stack approaches are likely to fail.

Click to download the TCO “Visualizing the Mobile Core.”

Click for more information about ACG's business case analysis consulting research service.

Michael Kennedy

mkennedy@acgresearch.net
www.acgresearch

Worldwide Small Cell Market to Grow Five-fold by 2019

Medium and large enterprises will boost the small cell market indoor residential coverage, with the total small cell market expected to surpass $1 billion by 2019

The Worldwide Small Cell market grew to $134.1 million, up 2.1 percent Q-Q and up 17.5 percent Y-Y. The market was primarily driven by the high demand for better indoor coverage. Small cells are not only used to offload traffic but also for backhauling and to substitute macro networks plugging the gap between capacity and demand for data. Residential and femtocells continue to be the key drivers of the current market growth; however, new multi-operator solutions with advanced SON features and interference avoidance are expected to have a tremendous positive impact to the market.

The growth in small cell market is expected to accelerate as operators realize that small cells are an increasingly cost-effective technology to add capacity while at the same time improve cell edge performance and increase the value of the spectrum they currently hold. Plug-n-play products equipped with advanced features and the latest 802.11ac WiFi and LTE technology will also add demand pressure.

“This quarter has yet again seen many indoor deployments, which will continue to grow but are expected to shift to enterprise and public access venues in the coming years. This shift will generate new business opportunities and sources of revenue for MNOs,” states Elias Aravantinos, principal analyst, ACG. “The ongoing hype around small cells is expected to end by 2016. High data demanding LTE networks and lack of spectrum in the macro layer will force the investment and deployment of a large volume of small cells to boost backhaul, access applications and new services. In the near future the demand of Gbyte levels at the small cell layer toward 5G adoption is expected to boost deployments and significantly affect operators’ spending. Finally, the market is expected to grow at least fivefold by 2019.”

TREND and DRIVER HIGHLIGHTS

• LTE connections worldwide increase 150%, growing the demand for high-speed connectivity indoor and outdoor

• 3G and LTE multimode small cells will continue to be on demand

• Integrating WiFi network with small and macro cells will enable operators to monetize WiFi

• The market is expected to grow because of increasing mobile data access pressure and increasing LTE subs

• Enterprise environment should enable MNOs to generate new sources of revenues

• Traditional microwave and potentially satellite are the top technologies for small cell backhaul applications

Click for more information about Elias Aravantinos.

    

    Elias Aranvantino

    earanvantino@acgcc.com

    www.acgcc.com

1Q Worldwide Mobile Infrastructure Markets Driven by LTE

LTE-Advanced deployment is a major industry, voice over LTE activities and high interest in end-to-end VoLTE solutions is driving the mobility market

The Worldwide Mobile Infrastructure market decreased revenue in Q1 and year over year. The Q1 Total Worldwide Mobile Infrastructure market posted revenue of $87.4 billion. Although mobile broadband net sales were primarily driven by radio technologies, and specifically LTE, the market downturn is attributed to the Ericsson’s North America decline, as most operators have completed their LTE deployments. But it is anticipated that the fast-rising data traffic could eventually require further upgrades of U.S. wireless networks to LTE-Advanced, generating opportunities for vendors.

Mobile spending was flat in the quarter and is attributed to carriers in the phase of planning to prepare for new deployments and network upgrades. Current trials with the different forms of LTE could potentially slow down spending until MNOs are convinced of the added value they bring to the networks with carrier aggregation. 3G remains strong and continues to grow as developing economies upgrade and invest in this technology. Mobile infrastructure will continue to be a highly dynamic market for the next several years as vendors and carriers are getting ready to offer new technologies such as VoLTE, network function virtualization, small cells, Hotspot 2.0, millimeter wave backhaul and DAS. Vendors with a plurality of solutions will need to have solid strategies and execution plans in this demanding environment.

“It has been an interesting quarter as the LTE key revenues shifted from North America and EMEA to Asia, which is becoming a very vibrant market across all the mobile technologies because of the large deployments and tremendous demand for mobile data,” states Elias Aravantinos, principal analyst, ACG. “However, there is ongoing 5G preparation and services convergence trend across all leading operators. This trend will result in high-performance networks. Providers are trialing new LTE forms, NFV, and virtual services as well as addressing densification affecting the small cell market and creation of a new IP voice services that support VoWiFi and VoLTE as complementary services. This is expected to increase operators’ spending the coming years.”

TREND and DRIVER HIGHLIGHTS

• Network innovations will facilitate bandwidth increases by expanding the capacity of the access network, reducing service providers’ costs, and creating new incentives for subscribers to stay on-net. For example, the benefits of LTE-Advanced include optimized heterogeneous networks with a mix of macro cells and small cells to improve coverage and reduce costs and use of multicarrier to support higher data rates.

• LTE worldwide initiatives will remain strong by the end of 2015, driving the demand for mobile backhaul, evolved packet core, and edge routing solutions; however, there will be a decrease in the mobile backhaul business when LTE roll-outs end. In 1Q some vendors benefited from a second round of investments in LTE backhaul infrastructure to raise capacity for demand. LTE TDD is gaining traction, as the LTE-TDD mode with unpaired spectrum continues to develop in all growing regions, particularly in China. LTE-Advanced systems commercially launched in more than 30 countries, expected to double in 2015.

• Market is expected to grow as operators start implementing their plans, upgrading networks because of mobile data access pressure and the LTE subs explosion. Online video will add to this data pressure because more than two-thirds of the global mobile data traffic will be video by 2017. VoLTE service and its growing demand will require, mainly in APAC and North America, more Small Cells for better coverage. Global machine to machine will triple its revenue growth mainly from international businesses.

Click for more information about Elias Aravantinos.

    

    Elias Aranvantino

    earanvantino@acgcc.com

    www.acgcc.com

SDN Requires a Standard Version as "a Prerequisite"

The networks programming process is quite challenging, as operators face several issues within Software Defined Networking (SDN) planning such as maintaining the five-nines reliability of telecom networks striving for reliability and high tolerance. Ultimately, a standard version of SDN is "a prerequisite" and operators are looking to deploy whatever can really interoperate not only with other pieces of the network but also with future networks. The SDN products, today, need to ensure full compliance with mobile-specific requirements in an identified and globally accepted proof of concept.

Recently, Nokia Networks has laid the foundations for deploying SDN in mobile backhaul through a proof of concept developed in conjunction with Finland-based Aalto University and other industry partners. The proof of concept has centralized SDN controllers operating standard transport and packet core switches in a virtualized LTE network with all control software running on generic data centers to enable a global view of the network but also running mobile backhaul, transport and core entirely in the telco cloud.

Huawei is engaged in a joint innovation project with the China Telecom Guangzhou Institute. It has released new products under its SDN based mobile backhaul solution LTEHaul, supporting SDN capabilities through the release of its CX600 series aggregation router, its ATN910 series cell site router and U2000 network management system.

There are several ongoing projects and forums where vendors have been proactively participating in standardization efforts in collaboration with stakeholders, operators, equipment manufacturers and research institutions, to promote the application of SDN in end-to-end networks.

Some examples are the Open Networking Foundation and the OpenDaylight project where Intracom Telecom serves as Silver Sponsor, aiming to transform the most mature SDN controller to carrier-grade status by evaluating and enhancing its performance and stability for massive scale deployments comprising several thousands switches. Ultimately, the goal is to extend this project to wireless backhaul networks. Intracom Telecom’s popular MW nodes (OmniBASTM and StreetNodeTM) have been designed to be OpenFlow ready; new networking functions are being developed on the OpenDaylight Controller to facilitate a smooth shift to the SDN architecture

The use of SDN in backhaul networks allows MNOs to work more easily with a number of suppliers, but also allows them to consider flexible network-sharing arrangements to drive down deployment, capital expense and operational costs. SDN is expected to redefine the backhaul network’s ecosystem and value chain, but there are still questions of when and how to migrate the critical network elements.

    

    Elias Aranvantino

    earanvantino@acgcc.com

    www.acgcc.com

Nokia-ALU Merger: Can the New European Force Race to the Wireless Top?

Following a trend I predicted in March 2015 (Intense market transformation and consolidation will be among the key 2015 wireless market features) Nokia recently announced it bought the French networking supplier Alcatel-Lucent in a deal valued at $17bn (€15.6bn). The combined company will be called Nokia Corporation, headquartered in Finland, with Rajeev Suri, continuing to serve as CEO.

The company’s goal is to “create the foundation of seamless connectivity for people and things.” Nokia plans to establish a €100m fund to invest in Internet of things startups in France following the closure of the deal, which is expected toward the end of the 2015, that is if there are no serious delays.

Alcatel-Lucent propelled by its successful growth in core networking and routing, was ranked No. 2 in edge routers in 2014 behind Cisco. The new Nokia will definitely take advantage of that position as this core networking unit will add a large percentage to the company’s total revenue. In addition, Alcatel-Lucent has managed to put together a serious wireless partner “ecosystem”, especially for metro and small cell requirements.

Alcatel-Lucent is also poised to capitalize and lead on new technologies such as 5G as the company is exploring a new air interface on the Filtered OFDM, and its strategic small cell partnership  with Qualcomm could be possibly expanded to enhance its future radio access portfolio.

Complementing this ecosystem is Nokia’s Flexizone and Flexi Radio, which covers macro and small cell layer in addition to virtualization, as the company has virtualized most of its core, RAN, as well as delving into NFV alternatives. Nokia also brings strategic partnerships with Dragonwave (mobile backhaul) and Juniper Networks (IP/routing) to the table.

However, the companies do face obstacles common in all mergers. The difficult points in this deal will be staff and product harmonization, especially related to existing customers. The company will have to deal with issues such as orchestration of product overlaps, multiple business partners (internal and external), LTE customers’ relations, and common management across USA, Europe and China. All of which could shake up the global market for quite some time.

Competitors, naturally, are digesting the impact of this gigantic deal but also realize that to stay competitive they will need to adjust their strategies as well as introduce new products as more intensive competition is anticipated across all sectors. Historically, Ericsson is used to that pressure, but this case is definitely unique and more challenging; NokAlu is expected to become a global leader in ultra-broadband, IP networking and cloud applications, has raised this competitive bar.

Investors should closely follow the new company’s milestones and stock as undoubtedly there will be many upturns and downturns before the company stabilizes. The core networking segment is a high-margin, strong performing one that should add and increase the value of NokAlu’s stock. Today, if we benchmark Nokia and Ericsson’s stock, there has not been much volatility during the past year, but there is a respectful gap in the value per share. But this merger could be a game changer.

Once the merger and its accompanying issues have been address and processes, policies staff, etc., are integrated, Nokia will be strongly positioned with a highly efficient and complete end-to end portfolio across all sectors to capture 5G global contracts. With 5G expected to be multidimensional very few vendors with innovative product portfolios will be able to comply and implement providers’ demands but with this merger Nokia will.

For more information about Elias Aravantinos click here.

    

    Elias Aranvantino

    earanvantino@acgcc.com

    www.acgcc.com

Forecast of Mobile Broadband Bandwidth Requirements

The consumption of video content is creating a shift from use in the home to mobile devices. This is driving exponential increases in mobile bandwidth demand. ACG Research projects most likely peak period bandwidth requirements to increase at 52 percent compound annual growth rate through 2018.

Dr. Michael Kennedy uses the forecast to model engineered backhaul capacity requirements for a 1,200 square kilometer metro area with a population of 2.5 million. This case study finds that the cell site backhaul bandwidth requirement will range between 0.4 Gbps and 2.5 Gbps in 2018. The odds favor the high end of this range. 10 Gbps Ethernet links in the access network and 10 Gbps rings will be needed to meet the demand requirement, support growth, and maximize load sharing. Agile network architectures will reduce the cost of supporting the expected rapid and volatile increases in mobile bandwidth demand.

Click here to download the business case "Forecast of Mobile Broadband Bandwidth Requirements."

Click for more information about ACG’s business case analysis services or contact sales@acgcc.com.

Michael Kennedy

mkennedy@acgcc.com
www.acgcc.com

Making the Business Case: Network Analytics for the New IP

An analytics offloading use case conducted by ACG Research compares the total cost of ownership of Brocade’s architecture with two PMO alternative architectures. The Brocade architecture has 23 percent to 33 percent lower TCO than the PMO alternatives. Brocade’s advantage is due to its use of virtual network functions hosted on virtual machines and the agility and elasticity achieved though Brocade’s orchestration system. A network monitoring and customer experience management use case compares the TCO of Brocade’s virtual architecture to an appliance-based architecture (PMO) and finds a 43 percent TCO savings for the Brocade architecture.

Click to download the Brocade NVA TCO Whitepaper_ACG.

For more information about ACG's business case analysis services contact info@acgcc.com.

ACG HotSeat: Brocade on Mobile Analytics for Next-Gen Networks

Michael Kennedy

mkennedy@acgcc.com
www.acgcc.com

How Big a Threat Is VoWi-Fi to the LTE Operator?

For years Wi-Fi was looked upon as the off-load network. MNOs were glad to off load massive amounts of data traffic onto these low-end, best effort, “free” networks, providing, of course, that their LTE networks were at or near capacity. Priority one, keep the billing meter running and only off load once the meter is maxed out. How could these $100 access points running off consumer-grade best-effort broadband become a threat? After all, MNOs have spent 10s of billions on a carrier-class LTE infrastructure.

The cable operators realized that they have a near ubiquitous high-capacity network and adding Wi-Fi access points was an opportunity. As we have seen numerous times in the past, when cable companies see they have an opportunity they quickly take advantage of it. Today, Comcast claims to have more than four million access points, which will grow to eight million by the end of the year. Yes, about half of these are in subscribers’ homes where (unbeknownst to them) they are a public access point for their neighbors.

Now, along comes voice over Wi-Fi (VoWi-Fi). This solves one of the age-old industry dilemmas: Great mobile voice outside OR great mobile data inside. Small cells and DAS are solving the indoor voice problem today; however, they are starting from an installed base near zero, and deployments are nontrivial and customized per venue. Outdoor small cells also face the added challenges of power and backhaul.

Wi-Fi is as close to a ubiquitous technology you will find. Enterprises, small business and residential consumers all have become accustomed to having access to Wi-Fi everywhere. There are clearly technical challenges to deploying quality carrier-class VoWi-Fi, but these are all solvable. After all they have been solved in the LTE market. Examples include MIMO antennas, seamless roaming and improved Doppler tolerances.

Thus, one can assume that VoWi-Fi will work and will “off-load” a significant percentage of indoor voice calls from the LTE network. Should MNOs be concerned? Let’s do some simple math to try to answer this question. It’s widely reported that approximately 80% of mobile traffic originates indoors. In five years what percentage of indoor voice traffic will be on the Vo-Wi-Fi network and not on the LTE network? Let’s assume 50%. This is reasonable because iPhone and Samsung smart phones support VoWi-Fi calling, and mobile subscribers are very aware of the cost of exceeding their mobile data caps. Therefore, the MNO will see a 40% reduction in voice traffic over the RAN and EPC. The BIG question is what the impact on revenue will be. If we assume that the revenue impact is only 5%, a $20 billion/year MNO would see a $1 billion reduction in cash flow. If the cable companies only see 25% of that amount, that’s $250 million in cash to them. The difference is assumed to be lost to price reductions. 

MNOs, MSOs and service providers looking at offering VoWi-Fi services will need help to address this threat and opportunity and develop winning deployment and go-to-market strategies. Likewise, vendors in this ecosystem need to be cognizant of the multidimensional dynamics of the VoWi-Fi opportunity. ACG Research can help develop your business and marketing strategies.  We can provide a range of services from complete strategy development to creating high-impact differentiated messaging to product launch support. 

How big a threat is VoWi-Fi to the LTE operator? Today, the answer is not much. Tomorrow, the answer is simply when is tomorrow. 

Contact ACG for more information as to what we can do to help you at successfully offering VoWi-Fi services.

Greg Whelan

gwhelan@acgcc.com

acgcc.com

Worldwide Mobile IP Infrastructure Market Continues to Rebound

Wireless is fueling capex, which indicates continued positive growth in the second half of the year

The Worldwide Mobile IP Infrastructure market grew in 2Q and increased to $1.25 billion, 9.6 percent quarter over quarter. Evolved Packet Core (MME, PGW, SGW, and PCRF) also grew this quarter to $123 million, 7.2% quarter over quarter. Online video continues to fuel mobile data traffic and the industry expects a tenfold increase in five years.  

Cisco continues to lead in the Worldwide Mobile IP Infrastructure market with nearly 40 percent share. Tracking its dominance in core routers, Cisco leads the IP Backbone market with 67.4 percent share. Cisco was number one in Mobile IP Backhaul with 40.3 percent share and in first place in Packet Core with 29.7 percent share. Ericsson holds 2nd place position in Packet Core (MPC + EPC) with 25.7 percent and 3rd place in total IP Infrastructure market with 12 percent share. Alcatel-Lucent, which claims 75+ IP mobile core customers worldwide, is second in the total IP Infrastructure market with 15.8 percent share.

Mobile spending continues is increasing globally as carriers in developed countries vie for top billing for fastest carrier, fueling LTE spending. 3G remains strong and continues to grow as developing economies upgrade and invest in this technology. Mobile infrastructure will continue to be a highly dynamic market for the next several years as vendors and carriers work through new technologies. Vendors will need to have solid strategies and execution plans in this demanding environment.

For more information about ACG's Mobile IP Infrastructure services, contact sales@acgresesearch.net.

For more information about ACG's Mobile IP Infrastructure services, contact sales@acgresesearch.net.

Ray Mota

rmota@acgresearch.net

www.acgresearch.net

Demand for All Things Video, the Implications

Although video has transformed public and private networks and continues to drive network deployments it also dwarfs all other network traffic types, for example, Netflix can account for upwards of 40 percent of local Internet traffic. The massive amount of bandwidth required drives the need for capacity in all parts of the end-to-end network. If you solve this problem for video all other traffic, voice, email, web and even IoT benefits as well.  

Consumers have an unending appetite for all things video. They are watching TV shows, movies, YouTube, Vines, Facetime or Skype on every device they have. Advertisers are increasingly moving to video ads and away from static banners. Truly live TV is exclusively sports and news. Appointment TV is a thing of the past. Everything is becoming on demand.

The implications of these trends cannot be underestimated. Not only do they impact all aspects of the telecommunication and Internet ecosystem, they impact the movie and television industries in a major transformation way. As these businesses struggle to adapt to overwhelming innovative forces they only know one thing for certain: They don’t want video assets to go the way of music.

Service providers, facing a hypercompetitive zero-sum market, are attempting to adapt and upgrade their physical networks, data center, core, metro and access to support video traffic. The race to 1Gbps per home is well underway. Back office systems are adapting as well. Marketing departments are creating new service bundles with higher data caps and source funded noncap traffic, such as taking an order to sending a bill, all of which need to be supported. Legal departments are impacted too. Issues such as net neutrality, asymmetrical interconnects, must carry and spectrum acquisition are just of few of the array of legal issues facing service providers globally.

Mobile operators are in no way immune from video. As they address their coverage and capacity issues video traffic is front and center. More smart phones mean more handheld video screens, which use more bandwidth and have much longer connection times. Here too, all aspects of the mobile operators business are impacted. Small cell deployments, WiFi integration and SON plus the emerging requirements of 5G must address the demand for video.

Video might just be a lot of ones and zeros, but the impact of massive amounts of video is disrupting the entire telecommunication industry. It is safe to say that decisions made by the entire ecosystem, service providers, equipment vendors, software vendors, semiconductor vendors, must address the onslaught of video traffic.

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Greg Whelan

gwhelan@acgresearch.net

acgresearch.net