Carrier Wi-Fi

A Case for Carrier Wi-Fi

By Stephen Rayment, BelAir Networks

Everybody loves free Wi-Fi but not everyone acknowledges that the best people to run Wi-Fi networks are the folks that run networks for a living, i.e. mobile carriers and cable operators. In her article, "The Myth of Free Wi-Fi," in BBC News Magazine, Virginia Brown bemoans the lack of free Wi-Fi but stops short of coming up with a sustainable solution. I think that the solution lies in more Carrier Wi-Fi networks. Even those who want to view Wi-Fi as a public utility, akin to electricity, would acknowledge that you want experts running the grid.

Of course, I'm biased. BelAir Networks builds Carrier Wi-Fi gear. We sell our Carrier Wi-Fi gear to Tier One carriers and we help them design and deploy big Carrier Wi-Fi networks. So, yes, I'm biased. But, I would also argue that I do have some unique experience and perspective to offer on the topic.

And like most of you, I'm sure, I am a mobile broadband user. And, as such, here's why I think users should want carriers to run Wi-Fi networks:

First, because experience has proven that only carriers can make large-scale Wi-Fi networks free. The BBC brings up the Swindon example but there were others - does anyone remember Earthlink? Meanwhile, major carriers like AT&T, Comcast, Time Warner Cable and Cablevision have all deployed large-scale Carrier Wi-Fi networks offering free Wi-Fi services to their subscribers.

Sure, you can argue that you have to be a subscriber to another one of the carrier's services in order to qualify for their free Wi-Fi. But, let's face it, most of us do subscribe to the services of a mobile carrier or cable operator, or both. So, chances are that if your carrier offered free Wi-Fi, you would probably qualify.

Carriers are also in the best position to make your Wi-Fi experience more seamless and secure. The concepts of secure seamless roaming (SSR) and session mobility (SM) are supported by carriers who want to make Wi-Fi as easy to use as cellular. The new industry standards known as Hotspot 2.0 and Next Generation Hotspot are all about SSR and carriers are driving these initiatives.

In a recent report on Wi-Fi Hotspots, In-Stat research listed network capacity as one of the potential inhibitors to Wi-Fi Hotspot growth. They stated that as more people use Wi-Fi hotspots more often and for higher bandwidth activities (like video), this increased demand could create a bottleneck that would need to be addressed through bandwidth management and increased backhaul. Carriers can do that. They do that in their networks every day.

Sure, carriers don't offer free Wi-Fi for nothing (that doesn't sound right but you get what I mean). Carriers deploy Wi-Fi to help offload mobile data traffic in congested cell sites, in order to ensure a better mobile broadband user experience. They offer it as a value-added benefit to their valuable subscribers. And they use it because it contributes to the profitability of their networks. Carriers know how to run sustainable networks - that's their business. Carriers know what kind of equipment to buy to ensure that the network won't break down - otherwise their OpEx would be out of control. Networks that aren't sustainable, where costs outweigh benefits, fail. And you end up with another Swindon.

Let's face it, Wi-Fi was originally developed as a residential and enterprise technology. But now that people are increasingly depending on Wi-Fi when they're out and about it is becoming a critical part of the whole mobile broadband equation. It's no longer a case of just installing a couple of APs and calling it a day. Even businesses that offer free Wi-Fi aren't doing it themselves anymore. In the US, Wi-Fi in Starbucks is run by AT&T. Businesses recognize that Wi-Fi is no longer just an amenity, it is on its way to becoming a network necessity. And because of that, they know it is best to get the network experts involved. The people that build and run networks for a living.

I think it's pretty obvious that carriers have a lot to gain from Wi-Fi but it's also obvious that users have much to gain from Carrier Wi-Fi. It's really one of those (trite expression alert!) win-win situations.

Reprinted from BelAir Networks Blog

Wi-Fi Offload

Wi-Fi Offload: Build Your Own Wi-Fi Network or Share It?

By Monica Paolini, Senza Fili Consulting

From FierceBroadbandWireless

For mobile operators fighting network congestion, Wi-Fi offloading has been an unqualified success. In some high-traffic locations in Hong Kong, up to 80 percent of the cellular data traffic is offloaded. In South Korea, SK Telecom has 62,000 hotspots which are actively used for Wi-Fi offload of cellular traffic. The operator plans to add 45,000 more locations during 2011.

In the U.S., the Wi-Fi offload strongest proponent is AT&T (NYSE:T), with 25,000 Wi-Fi locations. AT&T was the first operator in the U.S. to see the sudden increase in data traffic in urban areas where adoption of the iPhone was the highest (most notably New York and San Francisco) and, as a result, was the first that had to address systemic network congestion--not just the occasional congestion that may be driven by a specific event.

An increasing number of mobile operators are looking at Wi-Fi offload to relieve network congestion, keep costs under control, and improve the subscriber experience. As in many public locations Wi-Fi access is free and most households and office locations with smartphone users have Wi-Fi, offloading cellular traffic to these networks is a low-hanging fruit. The marginal cost to both operator and subscriber is zero (there is a cost to the operator that backhauls the Wi-Fi traffic, but so far Wi-Fi offload represents a small fraction of the entire wireline network traffic, so this has not yet surfaced as a major issue). All the operator needs to do is to nudge the subscriber towards Wi-Fi--not a difficult task, since most subscribers know performance over Wi-Fi is likely to be better than over 3G.

The other type of Wi-Fi offload--the one championed by SK Telecom and AT&T--is fundamentally an extension of the operators radio access network (RAN) to include hotspots directly managed by the operator. Wi-Fi hotspots are not designed to capture most of the network-wide traffic, but rather to reduce the traffic load in areas where the cellular infrastructure does not have enough capacity. As such, operators can choose to deploy hotspots where (and when) they see congestion in their network.
While congested areas typically represent a small percentage of a nation-wide cellular network, they are where many of the subscribers concentrate and where the need (and value) of mobile data access is highest. At these locations, the Wi-Fi infrastructure can carry the "low-margin bits," as Jeff Thompson, CEO of Towerstream, calls them--the traffic from bandwidth-intensive applications like YouTube that generates limited revenues to operators, but that has the potential to disrupt higher-margin services such as voice over the macro cellular network.

Mobile operators that decide to offload to a Wi-Fi hotspot network specifically built for this purpose have so far preferred to build and control their own networks. But is this the most effective--in terms of cost, performance, and time-to-market--route to Wi-Fi offload? Or should operators have some other company build them and operate the Wi-Fi infrastructure on their behalf? And if doing so, would it make sense to share the network with competing mobile operators--not on a roaming basis, but sharing the infrastructure with them?

The obvious advantage in building and operating a network is that the operator has complete control of it. As Wi-Fi uses license-exempt spectrum that is inherently shared with whoever decides to use it at any given location, mobile operators cannot exert the same level of control they have over the cellular RAN. Furthermore, the Wi-Fi infrastructure is typically not integrated within the broader cellular network, and operators have little visibility into what the subscribers experience is when they use Wi-Fi or to manage the Wi-Fi traffic as they do (or can) with the cellular traffic.

The depth of expertise among mobile operators resides on large and complex macro networks, not in Wi-Fi hotspots. Macro base stations are expensive and require lots of expertise to deploy and, in most cases, dedicated real-estate assets (i.e., towers or roof-top locations). Wi-Fi equipment is cheaper, faster, and easier to install, but the number of installations is higher and getting access rights and backhaul to them may require substantial effort and money.

The inherent lack of control over Wi-Fi networks and the fact that they are not developed or operated as an integral part of the cellular networks makes Wi-Fi offloading an ideal candidate for a wholesale or infrastructure-sharing model, in which one mobile operator or third-party operator builds and operates a Wi-Fi network that can be shared among operators, or in which one Wi-Fi operator builds and runs the networks for a mobile operator.

Although mobile operators cannot use the Wi-Fi network as a differentiator from other operators if they share the same network, they gain access to a much wider network with higher capacity than they could if they built one on their own at a comparable investment level, and do not have to risk to get distracted by the Wi-Fi network as they try to upgrade 3G or deploy LTE.

To date, the success of infrastructure-sharing initiatives has been very limited in the U.S., where operators do not seem to be under sufficient pressure to relinquish total control over their networks (although Sprint Nextel's (NYSE:S) plans to develop 4G network in partnership with LightSquared and Clearwire (NASDAQ:CLWR) seem to indicate a more welcoming attitude towards infrastructure sharing). This makes a third-party network for Wi-Fi offload a risky proposition, but nevertheless one that may gain acceptance because the need of operators to act quickly to increase network capacity in high traffic locations as their resources are more effectively aimed at their 4G networks.

Towerstream has launched an ambitious project to build a near-carrier-grade Wi-Fi network (to the extent that this is possible using license-exempt spectrum) that mobile operators can use for traffic offload. They decided to build the first network in Manhattan (San Francisco is next), where they have 1,000 Wi-Fi locations, with a plan to grow to 1,500. The next 500 locations will be chosen on the basis of "heat maps" generated by social networking traffic, which is expected to be correlated with mobile data traffic. The Manhattan network is currently in a trial stage, but we should expect tenants in a few months' time.

It will be interesting to see how this project develops and what type of acceptance it will gain among operators. There have been attempts at building Wi-Fi wholesale networks in the past. In fact, AT&T's Wi-Fi network is mostly the result of the acquisition of 20,000 hotspots from Wayport and the Starbucks network (previously operated by T-Mobile USA) in 2008. Before 2008, Wayport was the wholesale provider to AT&T. However the Wayport network was not built for Wi-Fi offload, but rather around partnership with companies like McDonald's which facilitated access to a nationwide network of well-recognized locations.

Towerstream approach and core advantages are distinctively different. The Towerstream network is optimized for offload and covers mostly outdoor locations, which pose a very different set of challenges than indoor locations such as Starbucks. Not only equipment has to be protected differently if installed outdoors, but power and backhaul connectivity may not be available or too expensive. Here Towerstream advantage is that it has access to backhaul connectivity (Towerstream is an enterprise wireless service provider in 12 cities in the U.S.) and has the experience in gaining access to a wide-range of outdoor mounting assets.

As real estate access and backhaul are crucial to build the networks that mobile operators need for offload, cable operators are also well positioned to address this market as they can use strand-mounted equipment installed on assets they control (no need to get deals with Starbucks) and use their own network for backhaul.

The success of a third-party business model can greatly expand the potential for Wi-Fi offload to address congestion in cellular networks. But intriguingly it can also offer a very good model for small cell deployments, where very similar real estate and backhaul challenges exist and are tempering mobile operators' enthusiasm for emerging heterogeneous topologies.

Carrier Wi-Fi

Carrier Wi-Fi: The Industry that Apple Built (...one launch at a time)

By: Bernard Herscovich

Since the introduction of the iPhone in 2007, it seems that every time Apple launches a new category-redefining product, Wi-Fi becomes more important to both users and carriers. In this blog I'll focus on the progressively more significant role that Wi-Fi has taken on for carriers following the successive iPhone, iPad and iCloud launches. (Disclosure: As this Reuters article, "Canada's BelAir Networks rides iPhone wave", from earlier this year makes clear, BelAir Networks has directly benefited from the trend I'm about to discuss.)

Before the iPhone, mobile broadband essentially meant laptops with dongles. It was broadband, certainly, but not very mobile. Of course, there were smartphones before the iPhone, but they tended to be more about mobility than broadband - certainly none before could match the rich mobile broadband experience that iPhone users enjoyed. But, as soon became clear, all that mobile broadband traffic generated by the hugely popular and iconic device, came at a price to the mobile network. And the first mover carriers to adopt the iPhone, like AT&T, were the ones who had to pay it. As the company acknowledged in April: "AT&T's mobile data volumes surged by a staggering 8,000% from 2007 to 2010".

Luckily, the iPhone was Wi-Fi enabled from Day One and, as Michael Morgan of ABI Research later pointed out: "the iPhone led people to use Wi-Fi to a degree never seen before." This foresight on Apple's part had two huge impacts on carriers. The first was that carriers realized that Wi-Fi could be used to augment mobile broadband capacity - a process often referred to as 3G offload - in areas of high user concentration. For example, AT&T launched a series of Wi-Fi hotzones in busy areas of New York City, San Francisco, Chicago, Charlotte and most recently, Austin. But, Wi-Fi on the iPhone, and the many smartphones that emulated its success, also allowed operators to get into the mobile broadband business without using licensed spectrum. Comcast, Time Warner Cable and Cablevision have all deployed Wi-Fi in their respective coverage areas and negotiated a roaming agreement allowing all of their customers to benefit from their combined coverage in NY, NJ, Connecticut and throughout Philadelphia. The cable strand mounted variant of Wi-Fi access points (AP) that these operators use has created a Carrier Wi-Fi market segment known as Cable Wi-Fi.

But, if the iPhone put unlicensed Wi-Fi on a more equal footing with its licensed band counterparts, the introduction of the iPad started tipping the balance, further increasing Wi-Fi's importance to carriers. Two key iPad features were instrumental in this continued shift. The first was its screen size. The iPad is ideal for viewing video on the go. Though video is supported on smartphones, their small screens made them more appropriate for clips than feature films. (Of course, they're also ideal for video calling, which Apple revolutionized with FaceTime, an app only available over Wi-Fi.) The iPad's relatively large screen made video viewing much more of a mainstream app. Video drives huge bandwidth requirements, compounding the congestion issues initiated with the launch of the iPhone. This alone would have been enough to highlight the increasing importance of Wi-Fi to carriers, but there was another iPad innovation that really underlined Wi-Fi as a critical carrier technology, namely the availability and ensuing popularity of Wi-Fi only versions. As I noted in a Wireless Week article, Wi-Fi: The Other Small Cell, back in February, industry analysts, Ross Rubin and Chetan Sharma, estimated that Wi-Fi-only iPads constituted greater than 60 percent of iPad sales with Wi-Fi-only usage accounting for 75 percent or more. The latest figures from comScore (for May 2011) reveal that 91.9% of iPad traffic occurred over Wi-Fi. Without a compelling Wi-Fi strategy, mobile carriers risk losing touch with their iPad-wielding customers. Conversely, carriers offering Wi-Fi can gain access to iPad users, even ones that aren't their mobile customers.

The only way to make Wi-Fi more important to carriers would be for Apple to launch a new revolutionary product that would predominantly rely on Wi-Fi connectivity. Enter iCloud. So now, carriers who don't offer Wi-Fi stand to lose the opportunity to connect (and connect with!) their customers whenever they're using iCloud for music, photos, or apps on any of their Wi-Fi enabled devices. As Lynnette Luna noted in FierceBroadbandWireless, "the notion of Wi-Fi hotzones is about to accelerate."

Carriers have many reasons for deploying Wi-Fi. They may want to offload data from 3G/4G, improve the profitability of their networks, offer a great mobile broadband experience, stay connected to their own customers or get connected to some new ones. But, whatever their reasons, chances are Apple had something to do with it. As I write this, Philip Elmer-Dewitt, Editor of Apple 2.0 at Fortune reports that "The Street has fallen back in love with Apple (AAPL)" and quotes Ticonderoga's Brian White: "Apple holds the hottest hand in the tech world". Nuff said, as they say.

So, now that Apple has made Wi-Fi critical for carriers, what are carriers demanding of Wi-Fi? BelAir Networks CTO, Stephen Rayment offers some insight into the demanding requirements inherent in Carrier Wi-Fi.

Reprinted from the BelAir Networks Blog

LTE Inadequate to Address Capacity Crunch

4G, femtocells and offload are all partial solutions, say European carriers

By Caroline Gabriel, Research Director, Rethink Technology Research

Although LTE upgrades are generally touted as the magic bullet that will save wireless carriers from the overload on their networks, they will not be enough on their own to solve the problem. This was the conclusion of a panel discussion at the Broadband World Forum in strike-ridden Paris.

The main factor limiting the impact of LTE on operators' data plans will be shortage of spectrum, argued Denis Gautheret, an executive at Deutsche Telekom. "Spectrum is just like gas. You don't have enough," he said, as Paris struggled with fuel shortages amid a wave of strikes over spending cuts. In particular, the lower frequencies support more cost effective coverage, but the desirable digital dividend band around 800MHz has very limited capacity, he said.

As reported by TotalTelecom, fellow European cellcos are taking different approaches to making up for the limitations of 3G or LTE. Jaime Lluch Ladron, technology executive at Telefonica, said the Spanish group is mainly focused on smaller cells for capacity, and femtocells to improve the indoor penetration of 2.6GHz, a key LTE band. "Telefonica is moving towards street level picocells and femtocells... based on this 2.6GHz frequency," he said.

Femto Forum chairman Simon Saunders, on the same panel, said it costs about $7-$9 per gigabyte to carry data on a wireless network, but by using femtocells in key areas, operators can bring about "a reduction in the cost per bit in the order of a factor of four".

Other tactics to address the data crisis were outlined too - Vodafone Spain and Elisa in Finland are going the damage limitation route, offering premium packages to enterprise or high value customers to prioritize their traffic, and offloading the rest. However Ladron spoke against the conventional wisdom that Wi-Fi offload is a key solution as the user experience is not under the carrier's control, and if customers have a poor experience "they will call us. They will get upset with us."

2010 Prediction: A Mix of WiMAX Smartphones and Low-Cost Devices to Emerge

By Guest Blogger Pascal Deriot, Senior Analyst & Partner, WiMAX & LTE Equipment, Maravedis

In a recent interview, Sprint CEO Dan Hesse commented that not only was its network up and running, but its compelling and cool devices, such as dual-mode 3G/4G smartphones, will make WiMAX a successful adoption. On the same front, Clearwire CEO Bill Morrow explained that the second stage of Clearwire’s business model, targeting the PDA/smartphone market, is to happen in the second half of 2010. Although Yota has proved that smartphones can be a great vehicle to promote the fantastic bandwidth capability of the first 4G technology, we also project that the cost of the WiMAX platform is another angle that needs to be considered.

As previously seen in Wi-Fi or 3GPP/3GPP2 markets, WiMAX chipset vendors have leveraged their first or second generations to further reduce chipset costs by migrating to a smaller geometry process node, and/or by introducing monolithic dies. At the same time, new packaging approaches, such as System-in-Package and optimized Bill Of Material (BOM), have significantly reduced the footprint of the WiMAX platform, allowing device manufacturers to launch a new generation of products that are more appealing, integrated, and that combine 3G and 4G standards.

The new research report released by WCAI member Maravedis in partnership with Reveal Wireless, “WiMAX Wave2 Subscriber Station Chipset Vendors Competitive Analysis” provides a detailed comparison of the key WiMAX chipset vendors, identifying system architectures, estimating chipset and system BOM, and cost of available devices such as CPEs, USB dongles or Express Cards. One of the report’s major findings is that WiMAX mass-market adoption may require sub-US$10 chipsets that are power and performance optimized for each application-specific segment. Maravedis and Reveal Wireless have identified three chipset vendors best positioned to achieve the US$10 price target through base-band and RF monolithic die integration in 65-nm.

Although most of the available chipsets are not highly optimized because they were compelled to cover a broad range of application segments, an additional study revealed that device manufacturers could build a basic WiMAX USB dongle solution for as low as sub US$50, while maintaining healthy profit margins. The figure below presents the breakdown of the cost of the USB dongle: the electronic BOM (eBOM) is composed of all the platform components, excluding the chipset. A basic USB dongle platform can be divided into 3 main sub-systems: base-band, RF and power management sub-systems, bringing the component count to 150-200 components. The rBOM, also called sometimes mBOM, defines the mechanical Bill-Of-Material. It contains the non-electronic components such as connectors, USB plug, antennas, PCB, housing, shielding or screws. Our total manufacturing cost estimation includes the labor cost, profit and SG&A. According to our research the WiMAX chipset, by its complexity and silicon die size, represents 44% of the total cost.

Moreover, our analysis shows that a combination of an aggressive Bill-Of-Material reduction by 20-30%, combined with a second generation chipset and higher production volumes, could further shrink the cost of the USB dongle by roughly 20%, providing a sub-US$40 product in 2010 time-frame.

We believe that WiMAX mass-market adoption requires a ubiquitous coverage and technology maturity, a mixed portfolio of appealing, integrated and low cost devices, and competitive WiMAX chipsets. We have no doubt that all these ingredients will be ready next year contributing to a fantastic growth of the WiMAX market, in all regions.

MARAVEDIS is a leading analyst firm focusing on disruptive technologies including smart networks using WiMAX, IEEE, and 3GPP/LTE. For more information about Maravedis, please visit http://www.maravedis-bwa.com/ or contact info@maravedis-bwa.com.