Tags: international roaming, iPhone, key lime pie, Mobile Internet profitability, Wi-Fi, Wi-Fi Data Offload, Wi-Fi Roaming
The greatly-needed ability to seamlessly use Wi-Fi (when available) from your smartphone or tablet took a big step forward to reality this week when Apple announced that they will support the Wi-Fi Hostpot 2.0 standard in iOS 7. What does that mean? Apple devices updated to iOS 7 will allow your mobile Service Provider to let your device securely use selected Wi-Fi hotspots, which can mean lower costs and higher throughput for you.
Hotspot 2.0 delivers the critical features that Service Providers and their Subscribers want:
- Automatic (no user action required, transparent operation)
- Secure (user data is safe, as is your subscriber identity)
- Interoperable (works with existing 3G/4G cellular networks)
Mobile Operators have been working hard to enable their subscribers to “roam” onto Wi-Fi when available, to offload the cellular network (reducing costs). The standard that they have developed is called Wi-Fi Hotspot 2.0 (kinda rolls off your tongue, doesn’t it?). Like any new service, to deliver it you need support of devices as well as the network. Since nearly all smartphones and tablets are delivered by Apple (iOS) and Google (Android), we must have those vendors support the standard. Now Apple will deliver in the Fall of 2013 with iOS 7, and we expect the next version of Android, Key Lime Pie, will similarly support the standard by YE2013.
With this support, we can expect Operators to start to deliver seamless roaming using Wi-Fi in-country and internationally, which can bring big benefits to you.
Tags: 1000x Mobile Data Challenge, Mobile Internet profitability, Wi-Fi, Wi-Fi Data Offload
Check out the excellent road map from Qualcomm, “1000X Mobile Data Challenge,” that explains how we can keep up with the exponentially demand for Mobile Internet. Since the introduction of the iPhone, we’ve seen consumer use exploding, with no end in sight. Globally, we observe that each year requires that we deliver 2X the data capacity than the previous year.
But you say, “1,000X capacity?! Really!!?” Actually, yes. Here’s why:
Q: Starting with a capacity of 1, and if you double that each year, then how many years until you reach 100? How many more years until you reach 1,000?
A: 6 years to reach 100, and another 4 years to reach 1,000.
So, at this rate of growth, we’ll reach 1,000 mobile Internet capacity in a decade.
So check out the QUALCOMM webinar series to understand some of the techniques that we can use to satisfy this demand. If you’re going to be around for another decade, you’ll find it a worthwhile perspective. The first webinar in the series overviews the problem and solutions, and is available for replay at “The 100x Mobile Data Challenge.”
P.S. This reminds me of the fable of the Inventor of the Chessboard and his Reward. When the Inventor was asked by the delighted Ruler to name his reward, he asked for a single grain of rice on the first square, two grains on the second, four on the third square, … On the 64th square of the chessboard there would be 9,223,372,036,854,775,808 (263) grains of rice!
Tags: Mobile Internet profitability, Wi-Fi, Wi-Fi Data Offload, Wi-Fi Roaming
Just like the early days of delivering any network, the initial focus is to (1) Build your network for your subscribers, in your defined market, and then (2) Broaden your footprint, by establish a large roaming footprint. (It can be argued if this is the correct order, since you can successfully be a Service Provider without building your own network, but this is definitely the order that you choose once you decide to build your own network.)
As Mobile Operators extend their networks to include Wi-Fi, they are initially (1) Building in-market Wi-Fi for “Data Offload”, and then they will establish (2) Roaming, to get more benefit where they have not (yet) built it.
Wi-Fi Data Offload –> Wi-Fi Roaming
In market Out of market
Most Operators are rushing to Build, and then the focus will then be to Roam.
Tags: international roaming, Mobile Internet profitability, Wi-Fi, Wi-Fi Roaming
Q: Do you ever notice when your mobile phone “roams” into other cellular networks? No? Good!
Imagine Wi-Fi working the same way, as a seamless extension of your cellular service.
Seamless Cellular + Wi-Fi will become the norm. You may be already enjoying this, if you are served by one of the leading Operators that have been delivering this, in advance of industry standards. In the U.S., if you have an iPhone from AT&T, you have been enjoying the automatic use of over 20,000 Wi-Fi hotspots for years without ever thinking about it. In Japan, KDDI delivered a similar solution in 2011 with their metro Wi-Fi networks complimenting their cellular service. KDDI’s “au Wi-Fi SPOT Service” gives Subscribers “Instant On, No-Touch Access” with over 100,000 hotspots planned throughout Japan.
Now that the industry has collaborated to create a standard to make Wi-Fi a seamless extension of your cellular service, it will be rapidly adopted by many Operators. The initial standards are ready, and products are already being delivered (from handsets to Wi-Fi networks to inter-carrier roaming services to Mobile networks). Cisco already has delivered compliant products to Operators (see “Cisco Next-Generation Hotspot Technology Delivers Seamless Mobile Experiences“), including a successful Trial with PCCW in 2011 (see “PCCW mobile Becomes World’s First Operator to Successfully Complete Commercial Next Generation Wi-Fi Hotspot Trial“).
Multiple organizations have collaborated to deliver Cellular roaming onto Wi-Fi: Where the device connects to the Wi-Fi network, the technical standards are produced by the Wi-Fi Alliance, and they refer to these features as “Hotspot 2.0″, while the business networking solutions are produced by the Wireless Broadband Alliance, and and they refer to these features as “Next Generation Hotspot.” To coordinate this solution with the mobile networks, the WBA is working with the GSM Association to incorporate the standards into their reference documents.
Wi-Fi Grows Up, an looks like Cellular
Here’s how Wi-Fi is growing up to deliver the same, seamless use that you enjoy on cellular networks: (for more, see Sue Rudd’s recent report, “WiFi Hotspots will be Small Cells in Mobile Broadband Networks by 2015” and a summary can be downloaded here)
This will give Subscribers all the benefits of Wi-Fi plus the ease of use of Cellular.
Q: Will I pay more to use Wi-Fi?
A: No. You will not pay more to use Wi-Fi within your own country/market. Currently, Operators are not charging subscribers for use of Wi-Fi, as it is not a separate subscription or feature, but a benefit available to all data users. Operators see this is a competitive advantage, to draw users to their networks, since Subscribers have increasing desired that Operators provide this service. Subscribers have been manually connecting to Wi-Fi, and relish the automated use of Wi-Fi (ADD reference to Movidia study).
Q: Can I use Wi-Fi to reduce the cost of International Roaming?
A: Yes. Initially, Wi-Fi is being deployed as an extension of the cellular coverage in your market (“Data Offload”). Subsequently, Operators will make roaming deals to enable you to similarly use Wi-Fi when you travel internationally, which should make using data far less costly.
Tags: Femtocell, Mobile Internet profitability, Wi-Fi, Wi-Fi Roaming
Wi-Fi is our primary network for connecting laptops, smartphones and tablets. You might be surprised to realize that Wi-Fi carries far more traffic than all 3G and 4G mobile networks combined, and will continue to do so in the future. Although mobile networks provides us with an umbrella of coverage, we tend to consume data when we are stationary, and typically Wi-Fi is available as our preferred choice of connection. Even as mobile networks expand their wide-area data capacity, Wi-Fi will expand its role as a compliment to cellular.Why? It is more efficient for us to use a nearby radio connection than one far away. Accordingly, it is more efficient for us to connect to a Local Area Network (Wi-Fi) than a Wide Area Network (3G or 4G Cellular). Mobile Operators increasingly speak of moving the network “closer to you,” and Wi-Fi is usually just a few meters away, which is nearly optimal. Mobile Operators want to deliver the best service to you, and so they are working to deliver small cells closer to you, and to take advantage of Wi-Fi (where it is available) that is even closer to you. Think about how much you use Wi-Fi today–in the house, in the office–and consider how much more traffic is carried over Wi-Fi than cellular. Why? Cost and Speed.
Although cellular is the ubiquitous network that we can (nearly) always count on, Wi-Fi is the preferred network that we use to carry our network through the Fixed Internet. Although Wi-Fi had humble beginnings (see reminiscing about the early move by Steve Jobs to introduce Wi-Fi into Apple laptops) to replace Ethernet cables, it has become our default network.
Of the different ways that we can connect to the Internet, Wi-Fi will carry an increasing percentage of mobile data: 50% more than Cellular in 2015 [per Juniper forecast]. Femtocells, in contrast, are not expected to play a large role. In fact, Wi-Fi will be the primary way for us to connect to the Internet, exceeding wired (Ethernet) connections (Cisco estimates that Wi-Fi is the leading connection in 2015, according to their annual VNI study).The original role of the femtocell, as “home base station,” has not been found as attractive as expected, especially due to interference with other cells that use the same spectrum. Subsequently, the femtocell technology has been repurposed into small cells (the Femto Forum renamed themselves as the Small Cell Forumthis February). Accordingly, the amount of traffic carrier by Femtocells is modest (although Small Cells are increasingly important and counted in the traffic carried by the Cellular network).
Wi-Fi will grow as a compliment to cellular Mobile networks, as Wi-Fi matures and acquires the best attributes of cellular: automatic, seamless, and secure (see “Wi-Fi, as easy to use as 3G mobile data“). Mobile Network Operators now recognize and embrace Wi-Fi for its benefits: Cost, Capacity, Coverage, Customer Experience. Mobile Operators particularly value Wi-Fi for its low Cost and high Capacity, as Mobile networks are simply unable to keep up with the demand (Capacity), and Operators are challenged to maintain the profitability as Revenue (for a unit of data) is falling faster than Cost (as Sue Rudd, of Strategy Analytics, has expertly deduced and illustrated), which reduces and eventually threatens profitability. Wi-Fi will help Operators to reduce their cost, and maintain the profitability of Mobile Internet for cellular operators
Tags: HD Voice, Mobile Internet profitability, Wi-Fi, Wireline replacement
Unfortunately for many mobile Operators, their revenues are shrinking: Classic voice is commoditized, and Text has become a diminished, all-you-can eat charge. Analysis forecasts that mobile revenues in Western Europe will not increase until 2014, Analysis forecasts (see figure, illustrating negative growth rates forecast). The US market is similarly seeing mobile revenues decrease (see figure, illustrating reducing Voice and Test ARPU, with growing Data ARPU). The challenge is to increase data revenues, quickly.
Q: What to do to boost revenues?
A: Make mobile data services mainstream (“Crossing the Chasm”). Also, enhance the value of existing services, to bring in new customers.
Taking data services mainstream
Mobile broadband data is being used by a fraction of the subscriber base, with a lot of growth available. Subscribers are overwhelmingly buying smartphones, but many do not subscribe to a mobile data plan. AT&T notes that “56 percent of all smartphone subscribers are on tiered data plans” [4Q2011 Earnings summary]. Adoption of mobile broadband is less than 50% of the subscriber base in developed countries. Growth rates for adoption of mobile data are moderate (20% more data subscribers in Europe, YoY growth), undoubtedly owing to the poor economy. Mobile data is on the verge of becoming a mainstream service, and Operators urgently need to make it easy for new users to get on board.
As an example of making data a mainstream service, T-Mobile (US) is doing a great job of making data services affordable. To encourage new users to “Try it, you’ll like it,” they build a little data into every plan. Also, they allow subscribers to use it at affordable rates without committing to a contract–removing hurdles to the use of mobile data, and making it easy for new users to add this service without breaking the piggy bank. Further, you are not penalized if you use more than you planned: “T-Mobile is the only nation-wide network with overage-free mobile broadband plans.” And you can use all of your services FREE over Wi-Fi (“Wi-Fi Calling”), so that if you have Wi-Fi, you have service, anywhere on the planet. Voice, text, video, e-mail … all free over Wi-Fi.
Enhancing the value of existing services
Orange is enhancing their existing voice service with an offering that should bring in new subs: HD Voice. Since Orange is leading the pack with HD Voice, and the service delivers enhanced voice when both parties have an HD-compatible phone, then once someone experiences this service, they will want all of their friends and family to have the service, too … causing them to flock to Orange. If HD Voice were to be made available on the iPhone 5, say, it could create a surge of influential customers that (a) quickly enjoy the service with a large percentage of others, and then (b) evangelize the benefits of the service to others.
Similarly, other Operators are working to add Presence info to your Address Book and communications apps. Imagine how much more efficient you would be in communicating on your mobile device if you knew whether your friend was Available or Busy, or whether they preferred that you contact them via IM/Text/Voice/Video. Several, leading Operators are delivering RCS (Rich Communication Suite) services to the market, and plan to succeed in making your communications easier and more fun. The benefits could be similar to the example of HD Voice, above: bringing in more subscribers to your enhanced offerings of classic, mobile services.
Tags: Mobile Internet profitability, Wi-Fi
To clarify the importance of Wi-Fi for Mobile Operators, this White Paper gathers the perspectives of a leading analyst, Service provider, and Wi-Fi equipment manufacturer. We prepared it on behalf of the Wireless Broadband Alliance (WBA), but it is available at several sites, including the contributors and the WBA. Please read it here and share your comments!
To develop the Business Case for Mobile Operator use of Wi-Fi, we are expanding this paper to include the perspectives of leading Mobile Operators, as a task within the WBA.
Tags: Mobile Internet profitability, Wi-Fi
Although Wi-Fi was in bad shape (as Phil Kendall recently noted), it looks like monetization of Wi-Fi may have taken a turn for the better with the recent introduction of the Hotspot 2.0 spec, announced at GSM Mobile World Congress and CTIA (Wireless Broadband Alliance, Wi-Fi Alliance). Hotspot 2.0 promises to make Wi-Fi as easy to use as 3G–secure and simple. And that is just what has been missing.
With Operators looking for ways to reduce their cost/bit and to serve the growing data capacity demands, Wi-Fi is a potentially attractive solution … if only it can be made simple (as Hotspot 2.0 offers). Smartphones, laptops and tablets are all likely candidates to benefit from increasing offload of data to Wi-Fi.
For more details, check out the excellent Cisco White Paper, “The Future of Hotspots” (they led the Hotspot 2.0 Task Force).
Tags: Femto, UMA, Wi-Fi, Wireline replacement
Continuing the use of mobile phones to its logical conclusion, mobile phone Operators and phone manufacturers are delivering solutions and pricing plans that allow the wireless phone to completely eliminate the wired phone. The End User can get the best of both worlds: lower cost and more functionality. I’ve run the numbers for individuals and enterprises, and it works. (I use it in my Home Office every day.) Benefits: One number, always reachable, one voice mailbox, etc. Users can choose to merge their wireline and wireless systems, but the end game is to completely eliminate the wireline (“cut the cord”).
Wireless + Wireline (Interim Step)
If the administration prefers to keep the desk phone (for regulatory or policy reasons, to track corporate communications), then the wireless device can work as a wireless extension of the desktop phone (see the example of BlackBerry Mobile Voice System). This is a lot more complicated to maintain: more gear added to allow the mobile phone to act as an extension of the office PBX, and more maintenance of that gear. This solution is only desirable for those that must keep the wireline phone.
Maximum savings of $1,000/year occur when the wireline or IP phone is eliminated. This solution is simple and easy to implement, as it does not add gear, it eliminates it. Eventually, the entire wireline solution will be eliminated, leaving the office with a wireless-only solution. This solution can be implemented using either (a) existing Wi-Fi or (b) a dedicated, in-building femtocell. Read on for a comparison of these two options and existing examples of these solutions, which concludes that UMA over Wi-Fi is best today, but Femtocells will eventually be the best solution.
Tags: UMA, Wi-Fi, Wireline replacement
Voice over Wi-Fi is growing, as predicted, since (a) Operators are happy to offload voice and especially data and, with Operator permission, the (b)Mobile phone manufacturers are building it into their (smart)phone platforms. This is part of the wider solution that Operators are employing to manage the deluge of data swamping their networks (see other articles for more details on how Operators are offloading mobile data to manage the exponential growth that they are experiencing, to prevent their Mobile Internet business from being broken).
UMA is the buzzword: enables Voice connections (transparent to the User) using available Wi-Fi connections. UMA is a piece of software that is built into the phone. It is a lot easier to use than a separate Voice over IP apps that must be installed and configured by the user, and that requires the user to have a IP data plan.
BlackBerry already has UMA across their model line, and Android may offer it (there are rumors that this is being tested; see petition requesting it). Apple iPhone has Wi-Fi but does not yet include UMA, but it could easily (perhaps we’ll see it in a future release).
UMA can deliver significant savings of $500/year or more, by eliminating a landline phone and allowing the user to solely use their mobile phone. It’s the equivalent of replacing your landline phone by solely using your cellphone (than can also save you up to $1,000/year, surprisingly), but the Operator typically encourages this and includes it at little/no cost! You get free voice in the Home/Office! One can save a lot on International Roaming and Long Distance charges, too, since UMA calls are routed over Wi-Fi back to the Home network, and appear (and are billed) as local calls–as if you were calling from your home/office. In actual use, we found that “Road warriors” could save up to $1,000/month by using a UMA device (such as a BlackBerry) to make calls over Wi-Fi while traveling.
Read on to see how UMA is one of many solutions towards eliminating wireline, in End Game: Wireline Eliminated.