FCC AWS-3 Auction Ends; Raises Record $44.9 Billion!

The Federal Communications Commission (FCC) has just closed its auction of AWS-3 wireless spectrum licenses, raising a record $44.9 billion in the process. The Wall Street Journal reports (on line subscription required) that this is the largest amount of money the FCC has ever collected from a spectrum auction, and is more than double what was earned in 2008 during the much publicized 700MHz auction.

[Reference: Has the 700 MHz Auction Been a Failure?]

The auction was comprised of over 1,600 different licenses.  The FCC said it will announce the auction results within the next few business days.

The AWS-3 spectrum cover frequencies in the 1700MHz and 2100MHz blocks, but they do not overlap with the AWS-1 spectrum that a number of carriers (most notably T-Mobile and Verizon) already use. AWS-3 spectrum is good at carrying large amounts of data and is well suited for cities, where wireless data use is soaring. Winners of the auction will likely use the new spectrum to bolster their existing wireless networks with greater capacity (except for Dish Networks which has been accumulating spectrum but hasn’t deployed a wireless network yet).

Seventy companies participated in this AWS auction, including Verizon, AT&T, T-Mobile, and Dish, but the FCC hasn’t yet released how much each company bid. The auction’s aggressive bidding surprised analysts who thought it would be a quiet affair dominated by AT&T and Verizon. Anonymous results show multiple bidders fought hard for coveted licenses in markets like New York and Los Angeles, which commanded the largest sums. As of the auction close, the four main licenses for the New York region alone totaled about $6.2 billion.

Analysts estimate the bulk of the auction proceeds came from AT&T and Verizon, each of which might have spent $15 billion to $20 billion on bids. It’s possible that both carriers bid around each other since the AWS-3 band plan made it possible for two carriers to land 20 MHz of spectrum. Other major bidders likely were T-Mobile and Dish Network.

The paired blocks have earned the largest bids in many markets. The J Block license for New York City alone has pulled in nearly $3 billion.

The aggressive bidding highlights the enormous scale needed to compete in the U.S. wireless market, a reality that makes it hard for rivals to challenge the market’s leaders. AT&T and Verizon control most of the industry’s most lucrative customers and the bulk of its revenue and profits, which gives them enormous financial firepower in such auctions.

While big markets like New York, Los Angeles and Chicago drew the highest bids, smaller markets including Portland, Maine, and Louisville, Ky., received bids over $20 million. One license in American Samoa commanded the lowest bid, at $2,800.


On Wednesday, January 28, 2015, the FCC said Blocks G, H, I and J garnered no bids or withdrawals during Round 337. Since no proactive activity waivers had been placed and the reserve price has already been met, the Commission closed bidding on those blocks: G Block (1755-1760/2155-2160 MHz), H Block (1760-1765/2160-2165 MHz), I Block (1765-1770/2165-2170 MHz), and J Block(1770-1780/2170-2180 MHz). H, I and J are broken up into 176 licenses each based on economic areas (EA) and G is broken up into 734 licenses based on cellular market areas (CMA).

Sprint to Shut Down WiMAX Service ~Nov 6, 2015

Overview:

At long last, Sprint has confirmed it will be turning off of its WiMAX service on or around November 6th, 2015.  That’s a little over 1 year for owners of WiMAX mobile devices (including laptops with WiMax cards/dongles) to switch to LTE .  WiMAX mobile devices will still work in 3G mode after that, but one doesn’t buy a 4G device or interface to use it in 3G mode, especially after a few years of ownership.

The time frame for the shutdown was originally reported by a blog on Android Central this past weekend, which cited an internal Sprint memo detailing the company’s network plans. Yesterday, Sprint spokeswoman Adrienne Norton confirmed the date to FierceWireless.

In April, Sprint said in a Securities and Exchange Commission filing that it would “cease using WiMAX technology  by the end of 2015.” As part of that effort, Sprint said it identified  approximately 6,000 “redundant sites that we expect to decommission and  terminate the underlying leases.”

This author long ago forecast the demise of mobile WiMAX, because no other major wireless telcos or mobile device makers (except Samsung) were supporting it.  In a September 2006 blog post, we asked “Will the Real “Mobile WiMAX” please stand up!”

What’s Cooking Now in Sprint’s Wireless Broadband Kitchen:

Sprint says it already has built its 4G LTE network to serve more than 255 million people, with more on the way, making it easy for customers to take advantage of all the great features on smartphones.

In addition to Sprint’s all-new 3G network and its 4G LTE network, Sprint is deploying Sprint Spark, a technology designed to greatly improve the performance of video and other bandwidth-intensive applications, including new generations of online gaming, virtual reality and advanced cloud services. It enables stutter-free video chat on-the-go and mobile gaming that leaves lag behind. Sprint Spark is an enhanced LTE service that’s built for data and designed to deliver average wireless speeds of 6-15Mbps and peak wireless speeds of 50-60Mbps today on capable devices, with increasing speed potential over time. Sprint plans to reach 100 million Americans by year-end with the service.

Beginning Oct. 10, the Sprint Business Share Plan will again double the data, now delivering 240GB to 800GB of data to business customers with 50 to 100 lines.  The latest promotion, running through Oct. 31, 2014, provides businesses double the data for $50 to $150 less per month than a similar promotion from AT&T.

The Road Ahead will be Very Bumpy:

A recent SEC regulatory filing confirms mass layoffs at Sprint.  With its latest round of layoffs and cost-cutting, it will be difficult for the smaller size company to expand and upgrade it’s LTE infrastructure and continue on the M2M/IoT path it had set for itself over four years ago.

Broadband TV Conference- Part 3: The Problem and Solution for WiFi Delivered Video Content -Why Can't We Watch Any Content, on Any Device in Any Room in the Home?

Introduction and Backgrounder:

The number of mobile devices in the home is exploding. Most “Pay TV” operators (like Comcast Xfinity, Verizon FioS, and AT&T U-Verse) are supporting multiple screen viewing as part of their “TV Everywhere” services. The content is mostly OTT VoD, video clips, or real time sporting events available by subscription (e.g. MLB.TV, NHL.com or ESPN3) that’s played on mobile devices, gaming consoles and even connected TVs.

In almost all cases, the in-home WiFi network delivers the streaming video content to the “second screen.”   Mobile devices will not likely use 3G/4G wireless access to watch videos, because that would consume a good chunk of the wireless subscribers monthly data plan.  Some second screens, like the Kindle Fire and iPod Touch, only use WiFi for wireless communications.  Furthermore, there is no charge for WiFi home video distribution (other than the OTT subscriptions the user has with the video streaming provider, e.g. MLB.TV, Netflix, Amazon Prime, Hulu+, Apple TV, etc).

[dropshadowbox align=”right” effect=”lifted-both” width=”250px” height=”” background_color=”#ffffff” border_width=”1″ border_color=”#dddddd” ]Note 1:  The U-verse Wireless Receiver is a wireless STB which is connected to the TV using an HDMI, component, composite or coaxial cable. It uses the WiFi home network to connect to a WiFi Access Point (AP) that plugs into the U-verse Residential Gateway via an Ethernet cable. The WiFI AP is also a “video bridge,” in that it extracts the TV content (SD/HD/apps) from the Residential Gateway, decodes it into the correct format, and delivers that content wirelessly over the in-home Wi-Fi network to the U-verse Wireless Receiver which plugs into the TV. The quality of SD/HDTV videos is expected to be a lot better than OTT video streaming, so would be adversely effected by any WiFi home network performance degradation.[/dropshadowbox]Most Wi-Fi home network implementations are optimized for best effort, peak data rate streaming. However, video is very sensitive to packet loss, latency and jitter, which results in artifacts on the consumers’ second screens (How many times have you noticed the OTT video picture freezing or sharply degrading in quality? Or loss of lip synch?). In addition, whole-home WiFi coverage and a consistent signal become mandatory for a good “user quality of experience.” Consumers will generally have their mobile devices, notebook PCs, STBs and TVs located in various nooks and corners of the home. They expect consistent video and audio quality whenever they’re watching videos on any screen in the home (or even in the back yard).

In addition to OTT streaming via WiFi in the home to notebook PCs and mobile devices, WiFi is sometimes used for delivering broadcast and on demand pay TV content. For example AT&T offers a “Wireless U-Verse receiver” for watching SD and HD TV plus apps that are included in the residential subscriber’s U-Verse TV package or bundle.1


Fundamental Problem with WiFi Delivery of Video Content in the Home:

Consumers have been led to believe they can watch any video content on any TV/device, in any room of the home. AT&T has been advertising this claim repeatedly in their TV commercials for U-Verse TV (Have you seen the one where the Dallas Maverick’s Mark Cuban invites players into his house to watch live basketball games on his tablet?). Google reports that 77% of consumers use mobile devices while watching TV each day. Touch screen mobile devices were said to have superior User Interfaces (UI’s) for search and socializing. Therefore, many people use them for watching and sharing videos while at home.

Ideally, video reception quality should not vary much depending on location in the home, but it does. AirTies claims the user experience is not nearly up to expectations when watching WiFi delivered video content within the home.  They say the primary bottleneck is poor WiFi performance – even with the latest IEEE 802.11ac silicon in the sending/ receiving WiFi enabled equipment/devices.

AirTies Presentation Overview:

Ozgur Yildirim, Vice President and General Manager – North America Business Unit- AirTies discussed this topic during his Broadband TV session on June 4. 2014.

Ozgur’s excellent presentation included actual measurements in a typical home. He also discussed network level limitations of WiFi, including: range performance, capacity impact of mobile devices,  interference from neighbors and streaming from DVR to 2nd TV. Finally, Ozgur presented a WiFi mesh-network home network solution to the problems inclusive of range extender/ boosters and other WiFi network enhancements. AirTies currently sells such a home network to Service Provider customers in Europe (see Comment and Analysis section below for further details on AirTies).

The primary problems with WiFi distribution of video and audio content is that it’s difficult for the WiFi signal to penetrate walls or reach corners within a typical home. That was supposed to be fixed with IEEE 802.11n and now 802.11ac, but not according to Mr. Yildirim.  Here’s why:

  1. In conventional WiFi, all wireless traffic to/from the Internet or between clients goes over a single WiFi Access Point (AP) which is embedded in a WiFi router, Video Bridge, or Residential Gateway. For “n” devices in the home, there are “n” point-to-point wireless links to the WiFi AP, which creates a star topology.
  2. WiFi capacity degrades logarithmically over distance and walls (RF signals at 5GHz – used by 802.11ac- are prone to absorption by walls which effectively reduce signal levels (i.e. results in a lower S/N ratio at the receiver).
  3. The slowest WiFi link pulls down the entire WiFi network capacity, which is shared amongst all the devices accessing that wireless network. Therefore, there is less effective bandwidth to distribute to mobile devices and personal digital recorders within the home as you add/use slower devices.
  4. Your neighbor’s WiFi signal was said to “consume air time,” which is something we hadn’t heard before! Ozgur provided this explanation via email after the conference:

“WiFi uses “Carrier Sense Multiple Access” (CSMA) – only one user can transmit at any one time, while others must wait. Since they all ‘share’ time and bandwidth this way, one ‘bad apple’ device taking too long will hurt all others. ‘Airtime’ is also shared with neighbors on the same channel. There are only three channels in 2.4 GHz – if you have more than two neighbors with WiFi home networks you share channels with them.”


Actual Tests of WiFi Home Network Performance under Various Conditions:

In an actual wireless home networking test in Istanbul, Turkey (headquarters of AirTies), sharing the WiFi aggregate bandwidth between three devices was said to reduce aggregate bandwidth/ total capacity by 65%. With a single device in the room, the WiFi capacity was measured to be 800M b/sec. When an iPad 4 (2X2 MIMO IEEE 802.11n), MacBook (3X3 MIMO IEEE 802.11ac), bridge (3X3 MIMO IEEE 802.11ac) the aggregate capacity dropped to 292 M b/sec in the same room.

Ozgur said that “much worse results would be obtained if the iPad was removed from the room.”  Ozgur provided this explanation via email to clarify that last statement:

“The iPad represents the legacy “slow” 802.11n client in the configuration described. It pulls down the entire network capacity- even within the same room. Recall that the single 802.11ac client got 800Mb/sec of WiFi capacity. If we were to put two 802.11ac clients in the same room, each client would 400Mb/sec. But when the iPad is introduced as a legacy (802.11n) client that does not support 802.11ac, the total WiFi capacity went down to 290Mb/sec.”

“Moving the iPad to a far location (with respect to the AP) in the home results in that (relatively slow) legacy client will get significantly slower due to poor WiFi reception. This results in the iPad taking much longer time to send packets which means much less time is left over for faster 802.11ac clients to access the home WiFi network.”


Worse, when moving one device upstairs, the total capacity was reduced to 92%, with an effective bit rate of only 68 Mb/sec. Wi-Fi link speed at the edge was said to be critical for performance in this case.

Almost as bad is “device-to-device” streaming performance -say from a Personal Digital Recorder/Network Attached Storage (PDR/NAS) to an iPad or other second screen.  That reduces total WiFi capacity by 40% to only 320M b/sec. With three devices in the same room the capacity drops to 175M b/sec. If the PVR (using 3X3 MIMO and 802.11ac) is moved upstairs, it drops to 38M b/sec.  [Remember, that total WiFi capacity is shared by all devices using that wireless network.]

A Solution for Mutli-Screen Video Streaming over WiFi Home Networks:

AirTies solution is a WiFi Mesh home network, which enables streaming video to multiple screens with much better video quality. That was said to outperform conventional Wi-Fi (with the star topology described above) by up to 10X. That WiFi Mesh configuration, along with conventional WiFi, is illustrated in the figure below:

An image of AirTies Mesh network configuration.
Image courtesy of AirTies

It connects each WiFi device/node to a WiFi AP and routes IP packets over the best path available at the time. Mobile WiFi devices connect to the closest AP at maximum capacity speed.

In conclusion, Ozgur said that such a “Wireless mesh network enables an ideal user experience. You can watch any content on any device, in any room, with premium (perceived) video quality.”

Comment and Analysis:

AirTies sells their technology to OEM partners, including several European telco TV providers. One of their products is called the Air 4641- a dual pack Wireless Digital Bridge “to optimize wireless video delivery throughout the home.” They also sell other products and solutions, such as a “wireless extender” which extends a WiFi home network’s coverage range and cleans up wireless signals (i.e. increases the signal to noise ratio).

This past March at TV Connect 2014, the company demonstrated HEVC adaptive bit rate video streaming, delivered over the public Internet to STBs, with Envivio (a provider of software-based video processing and delivery solutions) and Octoshape (a leader in cloud based OTT video streaming technology).


In contrast to the WiFi mesh network solution proposed by AirTies, a WiFi semiconductor company named Quantenna Communications Inc. published a white paper in March 2013, titled “Right Wi-Fi® Technology for Multi-Media Distribution.” It details and recommends how to get the best performance from 5 GHz IEEE 802.11ac for multi-media/video distribution within the home without using a mesh network topology. There’s no mention of a mesh network topology.

We thought this excerpt was especially noteworthy:

“For mobile devices, power is the most important, next is cost and lastly performance. In contrast, for whole home video distribution and general access points, higher performance connectivity with continuous error free distribution is a must. Error free video in the presence of interference cannot be compromised.”

References:

The Evolution of Wireless Home Networks, by Ece Gelal, Eren Soyak, Ozgur Yildirim of Airties

Interview with Burak Onat, AirTies Product Manager (multicast live video streaming demo with Octoshape)

End Note:  Please contact the author if you wish to pursue a consulting arrangement related to any of the topics summarized in the three Viodi View articles, or discussed at the BroadbandTV Conference last week in Santa Clara, CA.  Thanks.  alan@viodi.com

 

Meeker: Mobile is King of Internet Access and Content

Mary Meeker of KPCB puts out an Internet Trends report every year that is chocked full of interesting data on Internet, social, mobile and e-commerce trends.  In this year’s report at the Code conference in Southern California last week, Ms. Meeker said that while growth in overall Internet usage was slowing (especially in developed countries), it has increased rapidly for mobile.
Meeker said that:
  • Mobile data consumption is up 81 percent due to many more people using tablets and smartphones, especially to watch video. See graph below.
  • Mobile access now accounts for 25 percent of global web usage, up from 14 percent a year ago.  Mobile internet traffic is growing at a rate of 1.5 times that of conventional broadband.
  • Meeker sees it growing at an annual rate of 81 percent, with mobile video largely driving that growth.
  • Global mobile internet usage leaped from 14 percent to 25 percent between May 2013 and May 2014.
  • In North America, it jumped from 11 percent to 19 percent and in Europe it increased from 8 percent to 16 percent.
Mobile-Growth
Image courtesy of KPCB

Comment: This author finds it remarkable that “We now spend more time on mobile than on print and radio combined.”

In 2013, people spent 20 percent of their time on mobile devices, yet only 5 percent of the ad spending was allocated to mobile Internet access.   One would expect the latter to increase substantially in the years ahead. Meeker estimates there’s $30-billion per year to be made in mobile ads.  Therefore, advertisers, marketers, and media companies will try to get a good chunk of that ad revenue.

Meeker lists community, content, and commerce as the “Internet Trifecta.” With the ever expanding number of consumers online, there is a natural desire to connect with others through content. Marketers who provide context to the content they are creating and sharing are the ones who are able to increase connectivity within their communities of interest and grow stronger, which leads to brand loyalty.

Meeker said that there’s now clear evidence that people want to share information more privately. Mobile messaging services like WhatsApp (bought by Facebook for $19B), Tencent (QQ Instant Messenger in China) and Line (a South Korean-Japanese proprietary application for instant messaging) are growing at exponential rates — a trend that companies like Facebook and other social networking companies have noticed.

People were said to be “media junkies,” sharing articles via social media and tapping into streaming services. Apps are replacing linear TV channels as the way to consume video, with Americans aged 16 to 34 watching just 41 percent of their TV live, she said.

Google’s YouTube is also booming with consumers. “They are increasingly loving short-form video,” she said. “Consumers even love ads.” Indeed, 22 percent of video watching globally is done on mobile devices. On-demand mobile video apps, such as WatchESPN, BBC iPlayer, and HBO Go are all gaining popularity with mobile users. She says that 40 percent of Internet TV watchers are already using mobile devices (This author finds that to be incredible as most people we know do not watch Internet TV on their mobile devices except for video clips).

Meeker observed that 84 percent of mobile owners use devices while watching TV. They use them, in order of popularity for Web surfing, shopping, checking sports scores, looking up information about what they’re watching, and talking to friends/family or tweeting about the program. (That is something I certainly relate to as I do it all the time).

The country to watch is China, according to Meeker.  China has more Internet users than any other country by far – about 618 million Internet users last year. Approximately 80 percent of those only access the Internet via mobile devices. Four of the world’s 10 largest Internet companies are Chinese, up from one a year ago. [This author thinks they are Tencent, Baidu, Rakuten, and Alibaba].

In conclusion, the mobile Internet will continue to experience solid growth.  Therefore, it is imperative for Internet and e-commerce companies to develop content that resonates well with mobile audiences.


References:

1] Meeker’s Slide deck:

http://www.slideshare.net/kleinerperkins/internet-trends-2014-05-28-14-pdf

2] On-line Articles:

http://bits.blogs.nytimes.com/2014/05/28/state-of-the-internet-still-growing-but-more-mobile-than-ever/?_php=true&_type=blogs&_r=0

http://blog.hubspot.com/marketing/internet-trends-report-2014-mary-meeker

Congressional leaders ask FCC to Streamline Wireless Broadband Infrastructure Deployments

On May 29th, House Commerce Committee Chairman Fred Upton (R-MI) and Communications and Technology Subcommittee Chairman Greg Walden (R-OR) wrote to Federal Communications Commission Chairman Tom Wheeler to streamline the approval process for upgrading existing wireless facilities.  The letter asks Mr. Wheeler for clarification of Section 6409(a) – the spectrum provisions of the Middle Class Tax Relief and Job Creation Act of 2012.  That section was intended to speed the approval of eligible requests for new wireless broadband facilities.

“We urge you to take swift action to clarify the terms of Section 6409(a) consistent with the intent of the statute to deliver the benefits of wireless broadband access to all Americans. To ensure that 6409(a) achieves its goal of streamlining the approval of eligible facilities requests the commission should adopt rules that provide consistency for applicants and reviewing authorities alike.”

Note: Section 6409(a) of the aforementioned act states that “a State or local government may not deny, and shall approve, any eligible facilities request for a modification of an existing wireless tower or base station that does not substantially change the physical dimensions of such tower or base station.”

The two congressional leaders also expressed the urgency for the commission to identify ways to foster broadband infrastructure deployment.

“Facilitating both the deployment of small cells for targeted capacity and the use of temporary towers for short, sharp spikes in usage are part and parcel to meeting national broadband goals. Both are important tools for providing the robust service upon which consumers, businesses, and public safety rely.”

Comment:

We think the Congressmen are right on the mark with their requests.  New FCC rules and procedures are urgently needed to get wireless broadband deployed in more of the US, especially in rural areas that are currently un-served or under-served.

FCC Commissioner Ajit Pai in a speech last week at the Infrastructure Association’s annual conference echoed the concerns of the Congressmen:

“Regulations can make it tough to deploy infrastructure,” Pai said, lamenting that state and local municipalities decisions are often governed by antiquated one-size-fits-all rules and laws.

Referring to Distributed Antenna Systems (DAS) and small-cell deployments, Pai said:

“These systems are barely visible, and they hardly impact the surrounding environment” and in a reference to a Bob Dylan ballad, “neither DAS nor small cells belong on Maggie’s Farm no more.”

Are the Internet of Things (IoT) & Internet of Everything (IoE) the Same Thing?

Introduction:

For quite some time, Cisco and Qualcomm have used the term Internet of Everything (IoE) to describe what almost everyone else refers to as the Internet of Things (IoT).

Qualcomm says on its IoE web page

“When smart things everywhere are connected together, we will be able to do more and be more. This is the Internet of Everything (IoE), a paradigm shift that marks a new era of opportunity for everyone, from consumers and businesses to cities and governments….”

“Qualcomm is creating the fabric of IoE for everyone everywhere to enable this Digital Sixth Sense.”

Cisco defines the Internet of Everything (IoE) as bringing together people, process, data, and things to make networked connections more relevant and valuable than ever before – turning information into actions that create new capabilities, richer experiences, and unprecedented economic opportunity for businesses, individuals, and countries.

But is that the same as the IoT? And how do they both relate to Machine-to-Machine communications (AKA M2M)?


Network Gives Value to “Things” at Cisco:

Cisco devoted several sessions to the IoE at its flagship Cisco Live conference this week in San Francisco, CA:

  1. ITMGEN-4113 –  Delivering Value in an Internet of Everything World
  2. BRKNMS-2703 –  Managing the Internet of Everything
  3. BSAIoT-2400 –  The Transition to the Internet of Everything: Architectures and Use Cases
  4. GENKEY-2400 –  The Internet of Everything Ecosystem – Bringing IT and OT Together with the Internet of Things
  5. BRKIOT-2020 –  The Evolution from Machine-to-Machine (M2M) to the Internet of Everything: Technologies and Standards
  6. ATE-CL342 –  What Does the Internet of Things Mean to You?
  7. PSOIoT-2000 –  How will the Internet of Things Help your Business?

We liked this statement from one of the above IoT session abstracts: “The value of the Internet of Things is realized through networked connections of physical objects and devices. These connections are crucial for the transition to an Internet of Everything…”  But what exactly does that mean?

At Cisco Live, CEO John Chambers said the Internet of Everything (IoE) has changed the way the world looks at data and technology. Future IT industry growth will come from the IoE, which is generally referred to as the sharing of data between smart devices over a network without requiring human-to-human or human-to-computer interaction.

Chambers said:

“The simple concept, as you move forward with IoE, is that you have to get the right information at the right time to the right device to the right person to make the right decision. It sounds simple, but it is very, very difficult to do, and is almost impossible to do without our architecture….”

Mala Anand, Sr VP of Software and Service Platforms at Cisco, attempted to clarify the difference (from Cisco’s perspective) between the Internet-of-Things and the Internet-of-Everything at the Cisco Live session titled: The Internet of Everything Ecosystem – Bringing IT and OT Together with the Internet of Things .

Ms. Anand opined the Internet-of-Everything begins with the Internet-of-Things, which she explained is the movement driving connectivity into devices that were previously not connected.  “The Internet-of-Everything is a paradigm with a promise of business transformation at scale,” she said.   The “business transformation and value at stake” includes: asset utilization, employee productivity, supply chain/logistics, customer experience, and innovation.

Ms. Anand outlined three types of Internet-of-Everything connections:

  1. machine-to-machine, a.k.a. M2M (i.e. robots, sensors, etc.)
  2. machine-to-people
  3. people-to-people (i.e. social networking)

This world of IoE creates a different level of complexity with hyper-distributed environments, according to Anand.  She stressed the need to build a partner ecosystem that drives interoperability and support for a platform that can drive new sources of value and business models.  Indeed, Cisco partners Intel, NetApp and EMC also spoke at this Cisco Live session.

Anand reiterated previous forecasts made by Cisco executives – that the Internet-of-Everything will evolve into a $19 trillion market (“value at stake”) in the next few years.


IoT = IoE at Qualcomm?

During his opening keynote at TiECon 2014, Qualcomm CEO Steve Mollenkopf made no such distinction between IoE (the term they use) and IoT (mainstream term).  Steve implied that Qualcomm believed that the Internet of Things (IoT) was the same thing as the Internet of Everything (IoE).

He said IoE was an extension of Qualcomm’s existing business as it requires both mobile connectivity and wireless LANs (e.g. WiFi, Zigbee, etc).  

Note that Qualcomm now owns Atheros Communications- a leading chip maker for WiFi and other wireless LANs.

“Qualcomm is building a portfolio of products to enable the Internet of Everything (IoE),” Steve Mollenkopf said.  “Scale is very important to deliver on the very large surface area that will exist for the IoE,” he added.

What about “wearables?” “Health monitoring and wireless healthcare in general is a great, but different opportunity for Qualcomm. What’s needed is for the health care industry to fully embrace innovation in the IT industry. The supply chain for wearables is an opportunity for Qualcomm,” Mollenkopf added.


IoT – A Top Disruptive Trend Giving Rise to Multiple Market Segments:

McKinsey Global Institute’s Disruptive Technologies report calls out the Internet of Things (IoT) as a top disruptive technology trend that will have an impact of as much as $6 Trillion on the world economy by 2025 with 50 billion connected devices! Many are predicting 20 or 25 billion connected devices by 2020.

For sure, IoT will be a huge market, but not monolithic.  Each vertical industry will have its own opportunities and challenges. Lack of industry standards, security (business), and privacy (consumer) are the biggest obstacles for IoT to overcome and be successful. These issues must be resolved for IoT to reach it’s promise and potential.

We’re still not sure if IoT and IoE are two acronyms for the same term or something different. We’ll let the reader be the judge of that.

All-IP Network Transition Plan at FCC's Jan 30th Open Commission Meeting

Introduction:

[dropshadowbox align=”right” effect=”raised” width=”270px” height=”” background_color=”#ffffff” border_width=”1″ border_color=”#dddddd” ][/dropshadowbox]During his January 8th speech at the Computer History Museum (CHM) , FCC Chairman Tom Wheeler told the CHM audience that the U.S. was in a transition to a “4th Network Revolution” that would be led by a transition to an “all-IP” network.   The 4th Network is actually a multi-faceted revolution based on  IP based packet communications (for voice, data and video) replacing digital circuit switching and analog transmission. Communications protocols are moving from circuit-switched Time-division Multiplexing (or TDM) to IP packet switching.  At the same time, 3G and 4G wireless access networks are increasingly prevalent, empowering consumers to connect at the place and time of their choosing.

Wheeler said, “The transition to an all-IP network is important in its own right, but it also is important because it demonstrates that the Commission (FCC) will adapt its regulatory approach to the networks and markets of the 21st century.”

The FCC Chairman then said that no one would use a network without being able to make a 911 phone call (to report emergencies and seek help from law enforcement). That implies that the all-IP network must support 911 calls in a consistent manner.

From the FCC Web site, an image of FCC Chairman, Tom Wheeler
FCC Chairman, Tom Wheeler (image courtesy of FCC.gov)

Wheeler told the CHM audience:

“The best way to speed technology transitions is to incent network innovation while preserving the enduring values that consumers and businesses have come to expect. Those values are all familiar: public safety, interconnection, competition, consumer protection and, of course, universal access. They are familiar, and they are fundamental.”

Continuing, he said: “At the January 30th Commission meeting, we will invite proposals for a series of experiments utilizing all-IP networks. We hope and expect that many proposed experiments, wired and wireless, will be forthcoming. Those experiments will allow the networks, their users, the FCC and the public to assess the impact and potential of all-IP networks on consumers, customers and businesses in all parts of our country, including rural America.”

All-IP Network Topic at the FCC’s January 30th Open Commission Meeting:

The all-IP network transition will be the number one agenda item at the FCC’s January 30th Open Commission Meeting  Advancing Technology Transitions While Protecting Network Values is all about the transition to an all-IP network.  “The Commission will consider a Report and Order, Notice of Proposed Rule making, and Notice of Inquiry that invites diverse technology transitions experiments to examine how to best accelerate technology transitions by preserving and enhancing the values consumers have come to expect from communication networks.”

In a November 19, 2013 blog post Wheeler provided an overview of the all-IP network migration.  He wrote: “The way forward is to encourage technological change while preserving the attributes of network services that customers have come to expect – that set of values we have begun to call the Network Compact.”

Wheeler noted various FCC Commissioner comments in that blog post:

  • “Commissioner Pai said that the FCC should ‘Embrace the future by expediting the IP Transition.’
  • Commissioner Rosenworcel told us that, ‘As we develop a new policy framework for IP networks, we must keep in mind the four enduring values that have always informed communications law — public safety, universal access, competition, and consumer protection.’
  • Commissioner Clyburn has called upon the Commission, ‘To carefully examine and collect data on the impact of technology transitions on consumers, public safety and competition.’”

AT&T Petition and FCC Technology Transitions Task Force are encouraging trials:

On November 7, 2012, AT&T petitioned the FCC to “Launch a Proceeding Concerning the TDM-to-IP Transition,” GN Docket No. 12-353 (AT&T Wire Center Trials Petition).

That document requested the FCC to “open a new proceeding to conduct, for a number of select wire centers, trial runs for a transition from legacy to next-generation services, including the retirement of TDM facilities and offerings” and that “the Commission should also seek public comment on how best to implement specific regulatory reforms within those wire centers on a trial basis.”

AT&T requested that the FCC consider conducting trials where certain equipment and services are retired and IP-based services are offered. These geographically limited trial runs, conducted after a public comment period on how they should be carried out, would help “guide the Commission’s nationwide efforts to facilitate the IP transition.” Such an approach, AT&T notes, will “enable the Commission to consider, from the ground up and on a competitively neutral basis, what, if any, legacy regulation remains appropriate after the IP transition.”

AT&T has set a date of 2020 to retire its TDM network and has been upgrading its IP-based service capabilities in its wireline markets via Project Velocity IP (VIP).  AT&T presented a progress report on the Project VIP at the June 2013 IEEE ComSocSCV meeting.  It can be read on pages 3-4 of this article: Telco Tours & Seminars Top ComSoc-SCV Activities.

Technology Transitions Policy Task Force” which was tasked to move forward with real-world trials to obtain data that will be helpful to the Commission. The goal of any trials would be to gather a factual record to help determine what policies are appropriate to promote investment and innovation, while protecting consumers, promoting competition, and ensuring that emerging all-Internet Protocol (IP) networks remain resilient.   The FCC task force is seeking public comment on several potential trials relating to the ongoing transitions from copper to fiber, from wireline to wireless, and from time-division multiplexing (TDM) to IP based packet switched networks.

Technology Trials Proposed:

The FCC task force has proposed the following trials related to the all-IP network transition:

  • VoIP Interconnection
  • Public Safety – NG911
  • Wireline to Wireless
  • Geographic All-IP Trials
  • Additional trials: numbering and related data bases, copper-to-fiber transition, retirement of copper?

 The US Telecom Association was very supportive of such trials as well as the previously referenced AT&T petition. In comments submitted on January 28, 2013, the trade organization wrote:

“The idea that the Commission should conduct real-world trials in order to better inform itself as to the technological and policy implications of the IP-transition is a way the Commission can continue its commitment to data-driven policy making. The Commission itself has urged carriers to ‘begin planning for the transition to IP-to-IP interconnection’ and the Commission-guided trials urged by AT&T would facilitate this effort.”

“In particular, the AT&T Petition offers an opportunity for the Commission and state regulators to conduct informative, but geographically limited, trial runs for regulatory reform in discrete wire centers. AT&T correctly notes that such an approach will enable the Commission to consider, from the ground up and on a competitively neutral basis, what, if any, legacy regulation remains appropriate after the IP transition.”

US Telecom’s comments can be read here.

Important Unanswered Issues for an all-IP network:

Transition to an “all-IP” network implies retiring the PSTN/POTs, TDM/circuit switching and all wireless networks other than 4G with VoIP over LTE. That is a huge undertaking that will be incredibly disruptive and take many years, if not decades, in our opinion.  Here are just a few points to ponder about this monumental transition:

  • Telcos and MSOs must universally deploy broadband for wireline VoIP to be ubiquitous. Currently, they make their deployment/build out decisions strategically- based on reasonable ROI.  Not every area in the U.S. has or will have wired broadband as a result.
  • Many rural areas have little or no wireless coverage and certainly not 4G-LTE.  What happens to people who live in those areas, e.g. Arnold, CA?
  • Even if wired or wireless broadband is available in many regions, there is likely to be only one or two network providers at most.  Hence, there is little or no choice in service which is effectively a monopoly. Santa Clara, CA is in the heart of Silicon Valley, yet we now have only two choices for wired broadband – AT&T or Comcast.
  • There is currently no Universal Service Fund/Lifeline or discounted rate (for low income folks) for VoIP service.  Lifeline service is ONLY available for the PSTN/POTS.
  • If an individual or family doesn’t want or can’t afford high speed Internet and/or broadband TV service, then it will most likely be uneconomical for the Telco/MSO to ONLY provide VoIP service over broadband access. This is the case for many poor people and older Americans!
  • Battery backup is required for an all-IP network to make emergency phone calls when power is lost.  There is a substantial monthly charge for a battery backup box for AT&T’s U-Verse VoIP service. An AT&T subscriber must also have battery backup power for the Wi-Fi gateway to enable your AT&T U-verse services to function during a power outage.
  • There will be a huge impact on business customers that use digital circuit switched networks if the proposed all-IP changes happen soon in the affected areas or “wire centers.” What if a company’s main or branch office site(s) are located in an all-IP wire center coverage area?  In that case, the business customer would have to give up it’s digital PBXs or hosted ISDN PRI voice trunks and move to SIP trunks–even though the company is not nearly ready for a total enterprise-wide transition to an IP voice network.
  • What happens to faxes, which are still overwhelmingly based on the analog PSTN and not IP fax? The death of fax has been predicted for over a decade, yet it is still alive and kicking!
  • There will be a huge impact on business customers that use digital circuit switched networks if the proposed all-IP changes happen soon in the affected areas or “wire centers.” What if a company’s main or branch office site(s) are located in an all-IP wire center coverage area?  In that case, the business customer would have to give up it’s digital PBXs or hosted ISDN PRI voice trunks and move to SIP trunks–even though the company is not nearly ready for a total enterprise-wide transition to an IP voice network.
  • The transition from the classic PSTN to an all IP infrastructure will mandate the end of Signaling System 7 and the entire infrastructure that supports it. This is a substantial undertaking, the consequences of which are not fully understood. Can SS7-based functions be replicated on a broadband IP-based network? What would be the equivalent of a “voice grade” circuit? Is a SIP connection a functional equivalent for the key functionalities of SS7 switches? What about SMS/texts?
  •  The telephone numbering system provides a way for callers served by virtually any service provided in the world to reach one another. What will replace that system has yet to be determined. It surely won’t be an IP address which is often dynamic and allocated for temporarily reaching IP endpoints.
  •  Interconnection and Inter-operability between IP and TDM networks is a work in progress-for both voice and data.
  •  Quality of Service/Reliability/Resiliency is largely unknown with an all IP network, which would need to scale to replace and reach all PSTN/TDM endpoints. What would constitute an “outage,” and how should “outage” data be collected and evaluated? Here again, the battery back-up on power fail would need to be made mandatory and low cost or no cost to consumers and enterprises.

For sure, the above issues will challenge equipment vendors, regulators, business and consumers. We think the transition from PSTN/TDM/digital circuit switched to an all-IP packet network will take much, much longer than many expect.

FCC Delays Reverse Auction till 2015; Spectrum Aggregation & Ownership Limits?

The Federal Communications Commission (FCC) has delayed the “Broadcast Television Spectrum Incentive Auction” until 2015.  FCC Chairman Tom Wheeler published a blog post Friday announcing the delay, saying he hopes the auction will take place in mid-2015.  The FCC had set a goal of completing the auction in 2014 and we thought this would be the top priority for the new FCC Chairman.

Wheeler wrote: “I believe we can conduct a successful auction in the middle of 2015.  To achieve that goal, there will be a number of important milestones along the way.  The Task Force will provide more details about the timeline and milestones in a presentation at the January 2014 Commission meeting.”

When the auction is finally held, TV stations will consider bids to relinquish their licensed spectrum and either go out of business or obtain another frequency slot (i.e. TV channel). The licensed spectrum will then be put up for bid by wireless carriers, who covet the low-frequency airwaves because they can cover greater distances and travel more easily through physical barriers.

Observers have called the spectrum auction the most complex proceeding ever undertaken by the FCC. Mr. Wheeler said he has spent more time reviewing the incentive auction than any other issue since taking office, and determined it would be best to wait in order to ensure success. He hopes to avoid any technical difficulties with the software that will be used for the auction and “get it right.”

“I am also confident that the policy challenges are only part of the picture; we must also get the enabling technology right,” he wrote.

Because AT&T Inc. and Verizon Wireless control most of the spectrum under one gigahertz, the auction is considered particularly crucial for T-Mobile US Inc. and Sprint Corp. because it represents a rare opportunity to obtain low-band spectrum.  The 700 MHz band has been dubbed “beachfront property,” because of its excellent propagation characteristics.

“While AT&T is eager to see new spectrum allocations brought to market as soon as practical, we appreciate the enormity of the task the commission faces,” said Joan Marsh, vice president of regulatory affairs at AT&T.

Public interest groups and the smaller wireless firms have lobbied the FCC to set auction rules that would prevent AT&T and Verizon Wireless from grabbing up all the low-band spectrum at the auction. Mr. Wheeler has hinted that he is open to such limitations, but has yet to tip his hand one way or another.

There is also considerable pressure on the FCC to maximize revenue from the auction. The proceeds will be used to compensate broadcasters and fund a $7 billion public safety communications network known as FirstNet.  “This entire Commission is also acutely aware of the importance of the auction to fund FirstNet,” Wheeler wrote.

It’s unclear whether enough TV broadcasters will participate in the auction, which is voluntary. Stations affiliated with the Big Four networks (ABC, CBS, NBC, Fox) aren’t expected to, leaving smaller, independent  TV stations as the most likely participants.  Whether those stations will yield enough spectrum for the auction to be deemed a success remains to be seen.  Another issue is that if the FCC limits bids from AT&T and Verizon, that could depress the prices paid for the airwaves, resulting in less revenue.

Click here for a complete description of the Broadcast Television Spectrum Incentive Auction.


A related FCC spectrum concern is whether the commission will permit AT&T and/or T-Mobile to bid for Verizon’s 700Mhz spectrum that may be put up for sale. AT&T already holds the rights to adjacent 700MHz spectrum, and certainly has the cash to buy Verizon’s if it is put up for sale.  T-Mobile operates its network primarily in the 1900MHz and AWS (1700/2100MHz) frequencies, so the 700MHz spectrum is much more valuable than what they now hold. T-Mobile has targeted AT&T in its marketing in an effort to get customers to bring their phones to its network—and has successfully reversed a long streak of subscriber losses.

Availability of 700MHz spectrum is limited, and regulators have suggested there should be caps placed on ownership so that it isn’t monopolized by industry leaders Verizon and AT&T, which already own roughly 75% of the low-band spectrum currently in use by wireless carriers. In April, the Obama administration’s antitrust team had urged the FCC  to develop auction rules that ensure that T-Mobile US and Sprint are able to buy some of the prime airwaves and better compete nationally with their  two larger rivals.

The F.C.C. already enforces rules limiting “spectrum aggregation.” In theory, the FCC’s spectrum screen prevents further acquisition once a company goes above 33% of the licensed airwaves in one market area. But it applies that limit on a case-by-case basis, usually when one company buys another and asks to transfer ownership of the spectrum licenses.  Although it relies on general guidelines, the rules are unique to every individual transaction. Spectrum deals that violate the FCC’s screen are viewed much more closely by regulators.

After regulators rejected AT&T’s bid to acquire T-Mobile,  AT&T has lobbied the commission for a review on how to measure spectrum.  On the other hand, T-Mobile and  Sprint Corp have argued for ownership limits on lower band spectrum.  The FCC has not decided on any of this yet.

How is the Public Interest Served When Broadcasters Depict Illegal Behavior with No Consequences?

Perceived Great Risk of Marijuana Use among Youths Aged 12 to 17: 2002-2011
Perceived Great Risk of Marijuana Use among Youths Aged 12 to 17: 2002-2011

A recent episode of CBS’ hit series, Two Broke Girls, was thought-provoking; thought-provoking in the sense that it made me ponder, “In 2013, what is the public interest with regards to television broadcasters?”  That is, does it serve the public interest when a prime time (8:30/7:30 pm Monday), entertainment television program depicts behavior which is illegal under federal law without any negative consequences to those characters? In fact, one of the characters suggests a positive impact to the depicted behavior when she says at the end of the episode (20:37), “And another problem solved by weed.”

If CBS were a cable television network, there would be no question regarding its freedom to air the aforementioned episode, since cable television fare is not intended for the public airwaves. CBS-owned stations and CBS affiliates, however, use frequencies that are public and they were given the license (i.e. didn’t pay for the use of the airwaves) in order that they, “Foster the commercial development of the industry and to ensure that broadcasting serves the educational and informational needs of Americans.” Of course, the determination of what is educational and informational versus obscene and indecent is somewhat subjective and has led to court cases throughout the decades.

It is competition with the cable networks for an increasingly fragmented audience that pushes the broadcast networks to air content that is sometimes provocative and gratuitous. It is somewhat ironic that, on one hand the networks are lauded for removing positive references to cigarette smoking, while at least one shows its characters smoking illegal substances.

From a financial standpoint, the broadcast networks look increasingly like cable networks as they augment their advertising revenue with billions of dollars from retransmission fees; fees that are eventually paid for by consumers in the form of higher cable bills. Like cable networks, the broadcast networks are increasingly using the Internet to reach an audience that has tuned out of over-the-air broadcasts. Online is exactly where one can find the aforementioned episode of Two Broke Girls.

Maybe I Have Been Asking the Wrong Question

As I have pondered my original question, I realize that the right question isn’t whether the public interest is served by our current television broadcast licensing regime, but whether there are better ways to serve the public interest with the spectrum that the broadcast networks use. I contend today, as was implicit in this article from five years ago, that opening up broadcast spectrum for broadband use would provide greater value to the public; essentially allowing everyone to be a broadcaster through the power of the Internet.

In the aforementioned article, I lamented that it was too late to change the DTV transition to better serve the needs of the owners of the spectrum.

Perhaps it isn’t too late, as the proposed Consumer Choice in Online Video Act, S. 1680 by Senator Jay Rockefeller (D-W.Va.) would radically change the way “cable television programming” is delivered. By creating a new class of multichannel video programming distributor – a non-facilities based, online video distributor – the current notion of FCC regulations around things such as retransmission consent, local franchising fees and program non-duplication could be in for some big changes.

To his 16 page bill, I would like to suggest an additional clause:

Any broadcaster that receives retransmission consent fees for its programming would relinquish its spectrum or pay fair market value to the U.S. treasury for said use of its spectrum.

In other words, this language would acknowledge that the “broadcast networks” really are cable networks, given that approximately 93% of their viewers are delivered via an MVPD or a broadband portal.  The broadcast networks might lobby against this addition (along with the rest of Rockefeller’s bill), but at least one of them has already threatened to unilaterally take such a measure if the courts back Aereo.

There will be much fighting over the details of Rockefeller’s bill, but at least the conversation has started and perhaps now is the time to seriously look at how more of the spectrum that is currently used for broadcast television could better serve the public interest.


Additional Reference Material:

“Confusing messages being presented by popular culture, media, proponents of “medical” marijuana, and political campaigns to legalize all marijuana use perpetuate the false notion that marijuana is harmless. This significantly diminishes efforts to keep our young people drug free and hampers the struggle of those recovering from addiction.”

http://www.scripps.ohiou.edu/mediahistory/mhmjour2-2.htm

Small Cells: A Bright Spot in Dismal Wireless Infrastructure Market

Infonetics Research released excerpts from its 2nd quarter 2013 (2Q13) Residential and Enterprise Femtocell Equipment report, which tracks femtocells by market segment, technology, and form factor.

2Q13 FEMTOCELL MARKET HIGHLIGHTS

  • The global 2G/3G/4G residential and enterprise femtocell equipment market grew 4% sequentially in 1Q13, to $115 million, driven by LTE
  • Integrated femtocells are expected to account for nearly half of all femtocell units shipped in 2017, almost entirely within the residential segment
  • Infonetics forecasts FDD-LTE femtocells to grow at a 76% compound annual growth rate (CAGR) from 2012 to 2017
  • Cisco, who recently acquired Ubiquisys, sprang to the top of the femtocell revenue share leaderboard in 2Q13, thanks also to its work with AT&T, who lays claim to the largest scale femtocell deployment in the world
  • Airvana dropped to the #2 spot overall, but moved into the lead in the 3G femtocell segment

ANALYST NOTE:
“Sales of 3G femtocells still dominate the market, despite the focus of vendors on 4G,” notes Richard Webb, directing analyst for microwave and carrier WiFi at Infonetics Research. “Residential femtocells still account for the bulk of the market, though from this point forward we will see increasing adoption of femtocells from the enterprise segment, which is a key focus for a growing number of operators.”

FEMTOCELL REPORT SYNOPSIS:
Infonetics’ quarterly femtocell report provides worldwide and regional market size, vendor market share, forecasts through 2017, analysis, and trends for 2G (GSM/GPRS and CDMA), 3G (W-CDMA/HSPA, CDMA2000/EV-DO, and TD SCDMA), and 4G (LTE) femtocells. Femtocells are tracked by form factor (standalone and integrated) and market segment (residential and enterprise). Companies tracked include Airvana, Alcatel-Lucent, Argela, Cisco/, Contela, Fujitsu, Huawei, ip.access, NEC, QuCell, Samsung, Ubee Interactive, and others.

For more information on this report, contact Infonetics:


In a separate small cell survey, Infonetics interviewed wireless, incumbent, and competitive operators around the world about their small cell buildout plans.

SMALL CELL SURVEY HIGHLIGHTS:

  • 83% of respondent operators have deployed small cells, an increase of 11% from Infonetics’ 2012 survey
  • 78% of respondents rate “multimode” and “seamless integration with macrocellular networks” as very important small cell features
  • Small cell backhaul staged a comeback as a barrier to deploying small cells in this year’s survey, but overall barriers are waning with the exception of outdoor site acquisition, which remains challenging
  • Respondents don’t expect small cells to take the place of distributed antenna systems (DAS) anytime soon, instead viewing the technologies as complementary
  • New alternatives to small cells like Ericsson’s Radio Dot System hold the potential to reduce the need for DAS in very specific applications such as medium and large enterprises
  • A majority of survey respondents say they will definitely require self-organizing networks

“As evidenced by our latest small cell study, operators are seriously gearing up small cells for significant macrocellular network enhancements,” says Stéphane Téral, principal analyst for mobile infrastructure and carrier economics at Infonetics Research.

“Since service providers will be adding small cells to existing macro sites in very specific parts of their networks, there’s good reason to believe the total number of small cells will surpass that of macrocell sites, but definitely not by large proportions,” continues Téral. “Operators need to look at their spectrum resources and apply them as the need for capacity increases. This means selecting the right tool in the coverage and capacity toolbox.”

Read more at the ComSoc blog. 


From an article on another Infonetics report on Small Cells: 

Wireless network operators’ chief purpose for deploying small cells is to complement and enhance the macrocell layer from a capacity standpoint, to enrich the mobile broadband experience. Beginning in 2014, 4G metrocells will become the main growth engine in the small cell market, driven by in-building deployments in retail malls, stadiums, transportation stations, hotels, and event venues. Asia Pacific is where the action is and where it will stay through 2017: The largest macrocell network density, with more than 100,000-site footprints, can be found in China, Japan, and South Korea.

“The large service providers remain committed to their small cell deployment plans, but the pace of deployment is much slower than expected due to a sad reality: Small cell and macrocell rollouts share nothing in common,” explains Stéphane Téral, principal analyst for mobile infrastructure and carrier economics at Infonetics Research.  Téral continues: “Each technology requires its own internal business processes, which have been in place for decades with macrocells but have to be built from the ground up for small cells taking into consideration things like footfall, building dimensions, backhaul availability, and wireless technology. There is no cookie-cutter template for small cell deployments!”

Co-author of the report Richard Webb, directing analyst for microwave and carrier WiFi at Infonetics, adds: “Given that service providers are in the process of retooling their plan of attack, we’re not expecting the small cell ramp to happen in 2013.”

Read more at the ComSoc blog


Wireless Infrastructure Market Overview:

The global mobile network infrastructure business is in transition as the major equipment vendors reorganize. The manufacturers are eager to take advantage of the growth of mobile data, as consumers around the world shift away from making voice calls on their smartphones to accessing the Internet on phones and tablets.

Nokia now owns all of Nokia Siemens Networks, which had previously spun off its optical division. Alcatel-Lucent is also revamping, having announced this month that it would cut 10,000 jobs, or 14 percent of its global work force. Alcatel-Lucent wants to increase its profitability after several years of declining growth.

Ericsson today reported 3Q-2013 earnings that were less than the consenus forecast. More importantly, revenue fell 3 percent, to 52.9 billion kroner, also below analysts’ average estimate, of 54.3 billion kroner.

The Stockholm-based manufacturer of wireless telecommunications infrastructure (the world’s largest), is struggling in an increasingly competitive environment and has cuts thousands of jobs in Sweden over the past year to slash costs. Ericsson holds about a 35 percent global market share in the wireless network infrastructure used by carriers like Verizon Wireless and China Mobile.

Several European carriers- like Telefónica d’Espagne and Telecom Italia- are struggling to reduce their debt burdens and have put off infrastructure upgrades to their mobile networks. One bright spot in Europe is the UK carrier Vodafone which is a big Ericsson customer. The company announced in September that it would invest £6 billion, or $9.7 billion in its wireless networks after it sold its stake in Verizon Wireless to Verizon Communications (its partner in VZW) for $130 billion.

In the U.S., AT&T continues to build out it’s LTE network footprint in the U.S., which lags far behind Verizon’s which is available in over 500 cities. AT&T claims it has the fastest and most reliable LTE network.

Verizon disputes those claims and asserts that it has the most reliable LTE network PERIOD.

Sprint’s 4G roll-out is also progressing as per its Network Vision program.


But the real action in wireless network deployment is probably in China.  The country restructured its telecoms operator to create three fixed/wireless carriers and this change has stimulated growth along with the much delayed auctions of 3G spectrum. China Mobile is the market leader but in 3G, is seeing its lead squeezed by its rivals, partly because it was forced to use the home-grown technology, TD-SCDMA, which has limited ecosystem.

The second player is China Unicom, which uses W-CDMA and is forming partnerships with operators outside China, such as Telefonica. China Mobile is also outward looking and forming strategic alliances, notably with Vodafone and Verizon, which will help spur its plans to move quickly to the TD-LTE standard for 4G services.

The third cellco is China Telecom, which focuses on the CDMA platform. China is also becoming a key country on the vendor side, with Huawei challenging Ericsson for leadership of the infrastructure business and ZTE growing rapidly in handsets. These suppliers are helping China in its goal of becoming more self-sufficient in technology and patents.