Wi-Fi – “the toy that grew up”

Reprinted from the Wireless Broadband Association: Industry News Roundup

Wi-Fi – “the toy that grew up”

Historically, Mobile Network Operators (MNOs) looked at Wi-Fi as a toy, a low-end technology that was great to off-load data from networks. Now Wi-Fi is having a strategic impact on MNOs across the globe. Now the question is LTE or Wi-Fi: remind me which one’s for off-load?

Yet, as with many technical innovations, the low-end always wins. Wi-Fi is a classic example of this theory. Through a combination of Moore’s Law, economies of scale, R&D investments and free market dynamics Wi-Fi is king of the hill. In most developed countries people and things can access a Wi-Fi network in 80% of locations. Companies, such as Devicescape, have created virtual networks based on “ambient’ Wi-Fi networks. Hotspots are so ubiquitous that Opensignal launched an application to find the best one out of the many available.

Wi-Fi and Hotspots are becoming strategic to all carriers (fixed and mobile) as they have realized the importance of keeping traffic on their network for quality of experience and billing purposes. The market for carrier Wi-Fi gear continues to grow as carriers look to exploit these opportunities.

Today, high- speed access to the Internet is as fundamental as indoor plumbing. People expect it and city and national governments view it as mandatory for many economic development and quality of life issues. With the ubiquity of Wi-Fi enabled devices and the simplicity of Wi-Fi deployments it is no surprise that Wi-Fi is a leading candidate to achieve this. Even in remote,rural and under-developed regions, Wi-Fi leads the ways.

Even with fierce competition from ZigBee and other alternatives Wi-Fi is also a leading network technology for applications using IoT technologies. Wearables are no exception. LG smart watches use Wi-Fi and researchers are looking to Wi-Fi for an entire body network. We could all become Wi-Fi access points.

Yet success breeds challenges. Wi-Fi uses attractive unlicensed frequency bands and the licensed crowd wants in as the LTE community is looking to use the same 5 Ghz frequency band. Trying to head off a battle royale, the U.S. FCC has already entered the fray.

Wi-Fi, the toy that grew up, continues its momentum to solve real problems for consumers, businesses, service providers and governments. It was often said never to bet against Ethernet, I’d like to add never bet against Wi-Fi.

Greg Whelan, ACG Research

To discuss this and other strategic technology issues impacting the global service provider market please contact me

Access Insights™ At the Intersection of Service Provider Business Drivers and Emerging Technologies

What is “access”?  Simply put, it’s people and things accessing the cloud and each other. 

Access is no longer Fixed or Wireless.  Access is about connecting people and things to each other and to applications and service in “the cloud”.   Thus, access is about Fixed and Wireless.  It’s about having the right combined architecture on a neighborhood-by-neighborhood basis.  This “combo” trend is having, and will continue to have, major impacts and disruptions in the access market and in the entire service provider ecosystem.  New technologies, architectures and business models will emerge. Market realities are forcing carriers to offer (up to) gigabit speeds and incumbents have billions of dollars in deployed assets and architectures.  All this makes Access challenging for both technical/architectural and business decision making.    

I’ve determined that attention deficit disorder (A.D.D.) is a truly global phenomenon.  Therefore, I will present my points in terse salient bullets :-)

Top Access Insights to Ponder

1. The future of Access is Fixed and Wireless… not “or”
   1. SPs need to adapt organizations, so do vendors!
2. Gigabit Deployment Strategy
   1. Is timing everything? Plus...real strategic implications to the @$# Speed Test.
3. Next Gen Broadband CPE architecture and business models are being disrupted...
   1. Big risk to incumbent service providers and Vendors
4. Wi-Fi: The “toy” that grew up: Strategic implications abound
   1. Wi-Fi: Further proof that the “low end always wins”
5. Voice over Wi-Fi
   1. Nothing but upside to Cable Companies. Nothing but threats to MNOs.
6. LTE vs. Wi-Fi
   1. Remind me which one is for off-load?
7. Next Gen Cable Access Networks …
   1. PON Greenfield is redundant, DOCSIS Greenfield is an oxymoron
8. CPE vs. Carrier Gear (Plastic vs. Metal)
   1. Plastic companies building metal?
9. SDN-NFV in Access
   1. It’s coming… contemplations begin…
10. What’s the value of vendor incumbency at inflection points?
    1. Is Access different from any other industry?

There’s, hopefully obviously to the reader, a lot of thought behind each of these points.  I’d welcome the opportunity to discuss them in more detail.  Please contact me if you’d like to schedule some time explore how these insights impact your strategies and how we can create actionable plans to address and exploit them.

Greg Whelan gwhelan@greywale.com

If you would like to know when new articles are posted please "follow" me.

Nokia and Alcatel-Lucent: Who Should Buy Who?

Seeking Alpha reported that Nokia confirmed it is in talks to acquire all or part of Alcatel-Lucent and it is no surprise the companes are quibbling over valuation. Alcatel-Lucent has gone through some tough times and appears to be executing well on its Shift plan. Arguably, they are undervalued but investors are waiting for more tangible results, which will indicate that the plan is working. Current shareholders and employees can sense this positive momentum and are remiss to “sell-out” before the results of their hard work and commitment are fully realized. 

Consolidation in the equipment market is not unexpected. Communication service providers are consolidating too and are getting bigger. When this occurs large equipment providers tend to consolidate as well as they have fewer large customers and need economies of scale to be successful. This is truly a zero-sum game. Either you get 70 percent of the business, 30 percent as a second, keep the first one honest, source or you get zero percent. With the inherent complexities of SDN, NFV and virtualization, particularly in multi-vendor integration, it may be years before the “second’ source is even added.

Driving this buyout could be Huawei. The company is disrupting the entire global telecommunication equipment market. The industry has been aware of the company’s “grey area” business practices such as outright appropriating technology and intellectual property to giving eNodeBs away for free, with customers just paying the yearly maintenance fees (with a bonus of dozens of undocumented back doors). Although this is disturbing to the industry what really is of concern is Huawei’s huge product portfolio, their ability to throw “armies” at initiatives and their ability to take a long-term view to market (and global) domination.

The big issue for either Nokia or Alcatel-Lucent is who is going to compete with Huawei? Communication networks are a fundamental asset to nation states. They drive economic development, entertainment, education, national security, etc. Perhaps it’s time all governments treat them as national assets.

IoT Success: Batteries & Backhaul...& Transparency

The Internet of Things (IoT) is riding high at the peak of the Hype Cycle.  Is it a $17 Trillion market or merely a $10 Trillion market?  Depends on what you include in your definition of a "thing".  The more you include the bigger the market.  

IoT applications have a basic common architecture as shown in Figure 1. IoT digitizes some analog parameter and sends it to the "cloud" for analysis and possible action.   The primary factors that all IoT or M2M applications must address are Batteries, Backhaul and Transparency.   

Let's address the transparency issue first.  In quantum physics there's the "uncertainty principle".  Simply put is says that whenever you measure a system you disturb it.  Since most IoT applications measure a real world analog phenomena (e.g., temperature, pressures, et al) the "thing" must do so with minimal impact on the system you are measuring.   Transparency parameters include cost (CAPEX and OPEX), size, weight, aesthetics etc. 

Batteries, or more generally power, is a critical parameter within IoT applications.  If you require grid power you lose some transparency and limit your ability to deploy the thing.  Not every location will be close enough to the grid to be able to be powered by it.  Remote sensors will require batteries.  These batteries must last many months and even many years.  

Even IoT applications within the home must address the battery issue.  Take a simple motion detector.  The ideal placement is in the corner of the room near the ceiling.  Not many power outlets near by.  Thus the customer can either install an outlet close by, move the sensor close to the outlet (i.e., near the floor) or have to see the wire dropping down to the nearest outlet.  Batteries solve this problem.  However, if they need to be replaced every month the value and transparency quickly depreciates.  What if this motion detector is part of a security perimeter for a high value asset (e.g., power plant).  If the good guys need to replace the batteries periodically it will show the bad guys where these "hidden" sensors are.  Thus, batteries are critical to the success of the application and can make or break a business case.  

The "I" in "IoT" is for "Internet", meaning internet protocols (IP).  The digital data of the analog phenomena must be sent to the cloud via some type of network. This is referred to as Backhaul.  Networking options are plentiful  and include 2G/3G/4G/LTE, Wi-Fi, Zig-Bee, Satellite, Blue Tooth, Ethernet and local broadband options.  The technology selected depends on the application and on parameters such as data rates, latency, cost and what's available.  The more remote the thing is the less options are likely available.  The selection of a backhaul solution must address both transparency and battery issues discussed above.  

There are other issues and parameters that need to be address to make an IoT application successful.  For example, the cloud solution (e.g., "big data" base, analytics, heuristics, et al) are not trivial yet they are solvable engineering problems.  The same is true for the "thing" or sensor. For most all you have to do is go to the Analog Device catalog and select a chip.  Again, non trivial but solvable.  Thus, batteries and backhaul and transparency are critical make-or-break parameters to ensure success of your IoT application.

To discuss this please email me at gwhelan@greywale.com

Other articles can be found at greywale.com

The Next Cord Cutting: Real Cord Cutting

Today "cord cutting" refers to consumers who stop paying for TV and go broadband only from the cable or telecom company.  This is more accurately called "cord shaving".  The economic impact is significant but it's more of a redistribution.  More money to "Netflix" and less to the service provider for video.  Yet, more to the latter for higher capacity broadband that provides higher margins.

Tomorrow's "Real Cord Cutting" refers to consumers who completely stop all services from a wired service provider.  The go completely wireless.  We've seen the prequel with the elimination of a "home phone".  This next generation cord cutting has consumers relying on their 4G/LTE service for all broadband services.  This can be accomplished by simply turning their smart phone into a Wi-Fi access point when in their home.  The economic impacts of next generation real cord cutting are severe. The fixed access service provides not only lose all service revenues they lose customers entirely.

As 4G/LTE deployments expand and as more small cells get deployed the average bandwidth per device will increase substantially.  When the Netflix threshold (e.g., when the quality of streaming video is acceptable) is only a matter of time.  Slowing down real cord cutting will be the price of mobile data plans which will eliminate the intended savings in the first place.   Service providers with wireless assets will be in a strong position to succeed in this future scenario.  Other, such as cable MSOs will need to address their pricing plans which are driving customers away in the first place.  They can also compete with unique content, primarily "Sports and Wars", (i,e., live programming) and push for better quality video such as emerging 4K technologies.

Today's cord cutting is growing significantly especially in the under 30 demographic.  Tomorrow's real cord cutting will occur and will have substantial economic disruption for the entire ecosystem.


For past article please visit greywale.com 

Open Internet + Fast Lane: Win for Consumers: Yet Trust but Verify

The recent move by the FCC is a win for Consumers.  Yet, it's important the FCC "Trust but Verify".

Let's look at who will be the winners with the new FCC rules.  The Consumers.  Consumers will be the ultimate winners.  First, the ISPs will get a fair return on their capital investments and will have the incentive to invest in more bandwidth. Which enables wave after wave of innovation.   Second, those companies that pay for the fast lane will be those that consumers want and have a willingness to pay for.  Netflix for example.

Keep in mind that the FCC proposal STILL prohibits the ISP for degrading traffic.  Thus, those consumer applications in high demand get preferred treatment for the last 50 miles of the network (CDN Cache to home) and all other traffic gets treated the same it's always been.

The argument that small start up companies will be disadvantages is hollow.  It will force entrepreneurs to innovate more to deliver a compelling product to consumers.  It's just another market force to overcome.  It will raise the bar and eliminate the marginal applications from clogging the network.   This is no different than supermarket shelf space, a large barrier to entry.  Coke and Pepsi dominate.  Yet, look at all the upstart beverage companies that keep gaining shelf space.  They're doing this by creating innovative products that consumers want.  Not by whining to some federal regulator.

Why do industry pundits complain when Verizon, AT&T, Comcast, et al get  fair return on their investment and look the other way when Google, Amazon, et al make $1000's per second? 

Therefore, Consumers are the big winner here.  A) More bandwidth B) More innovation and C) Less marginal applications.

Given that the FCC is charted, via the Congress, to protect consumers this new Fast Lane approach is a step in the right direct.  However, the service providers must be careful not to over use this opportunity.  Hence, the "Trust But Verify" mantra.

Telco's and Cableco's must know that the FCC will be closely monitoring this new ruling (assuming it gets implemented).  They must adopt a high level of transparency to eliminate complaints from consumers.  Remember, all it takes is some savvy lawyer to get a single citizen to file a complaint.  To prevent endless litigation and legal costs that effectively eliminate the economic value to the "fast lane",  service providers need to provide this high level of transparency to avoid an FCC mandated higher level of transparency.

SPs should freely adopt a level of transparency that satisfies consumers and their advocates and limits the level of proprietary disclosure to their competitors.  They should ensure the "fast lane" does not, by design,  effectively harm all other traffic.  This can occur unwillingly using standard IETF IP Networking Protocols.

Therefore,  I believe the "Open Internet + Fast Lane" approach is worth implementing. It ultimately benefits the consumer and it's fair to the service providers.  Yet, and a "BIG YET", the FCC must Trust and Verify.

To comment on this or to discuss this in more detail please contact me at gwhelan@greywale.com

For additional articles and analysis please visit www.greywale.com

Is VoLTE Worth the Investment?

Mobile network operators across the globe are moving to deploying VoLTE (Voice over LTE) systems.  The reasons for this are as expected.  They include:

1. Better voice quality
2. Protect voice revenues
3. Leverage IMS investment
4. Be able to provide billing services (Leverage their billing system)
5. Migrate 2G and 3G voice services to LTE

However, given the successes of over-the-top (OTT) services over wired broadband and in current wireless networks is this billion dollar investment prudent?  Consider the following:

1. OTT has won, or is winning, the battles.  Skype and Netflix are two good examples.  WhatsApp is another case in point of OTT success. 
2. OTT services are “good enough”.  The majority of the market is unwilling to pay for QoS when a free, or near free, service is sufficient.
3. When a consumer experiences poor quality for an OTT service they blame the service provider and not the OTT provider.
4. QoS can only be guarantee when the “call” is completely on-net.  As soon as the voice call leaves the originating SP all bets are off.  Why spend the $ billions only for a subset of calls?
5. Voice revenue and now SMS Text revenues are crashing.   Why spend $ billions to chase a losing battle?
6. Service providers are moving away from call-based billing (i.e., CDRs (Call Detail Records)).  Although the NSA loves them.  Unlimited calls and texts are the norm. 
7. Data limits are prevalent.  A few Youtube videos or one Netflix movie will dwarf a month’s worth of phone calls from a data usage perspective. 
8. When Google deploys their fiber optic networks (e.g., Kansas City) they do not offer voice services.  The reason is to avoid the mountains of regulations required when offering voice services.    Does that mean people in Kansas City don’t make voice calls?  

It is understandable why a service provider with decades of legacy voice experience would want to consider VoLTE.  After all, they have decades of legacy voice experience.   Similarly, it’s not surprising that service providers that have spent $ billions and years deploying and perfecting IMS want to leverage that investment in time, money and careers.  It’s difficult to face reality that IMS is a “sunk cost” and therefore should not be factored in when evaluating VoLTE investments.

The OTT trends and successes cannot be refuted.  Service providers continue to face the fact that they cannot compete effectively against every segment of OTT services.  The $ billions they would spend on VoLTE would be better spent on: 

1. Increasing bandwidth per subscriber
2. Providing industry leading network security to protect their subscribers
3. Fighting the short sighted Net-Neutrality laws that make regulators “feel good” at the expense of long term viable markets.
4. Creating an infrastructure where OTT’s want to pay them for QoS in a fair, open and non-discriminatory manner. 

I’ve spent 20 years working on technologies with the goal to ensure service providers do not become a “dumb pipe”¹.   I am fully biased toward ensure the success of SPs and believe that “net neutrality” is unfair to them².  However, SPs should not spend $ billions on VoLTE just because it’s voice.  High speed, high quality broadband is the future.  Don’t fight it.

To discuss this please contact me at gwhelan@greywale.com

 Notes:       

1.  http://greywhalemanagement.blogspot.com/2012/07/if-sps-become-dumb-pipe-everybody-loses.html
2.  http://greywale.blogspot.com/2014/02/net-neutrality-overruled-win-for.html

 Click here for an INDEX of Articles and Post

Network PVR a Win for SPs and Consumers

Moving the "storage" function out of the Set-top box and in to the network is a win for both the service provider and for the consumer.  This article, written in ADD solving terseness,  will give the read an overview of the salient points of the benefits of deploying a network-based DVR or N-PVR.  Comments/corrections/suggestions are always welcomed.

What is N PVR?

1.       Network Personal Video Recorder (a.k.a. Network DVR)

2.       A DVR in the Cloud

3.       A user’s programming or content is stored on a server located within a service providers facility instead of stored on a hard disk drive embedded in a set-top box.

Benefits for Service Provider and Consumer

1. Enables SPs to remove costly storage in every STB.
1. One less device to fail.
2. Reduces cost per STB,  less stranded capital
3.  Reduces power consumption of STBs
1.   Helps achieve goals set in voluntary agreement (see: http://greywale.com/wp-content/uploads/2013/09/greywale-communique-STB-010614.pdf)
2. Makes whole home DVR simpler
1.  All traffic originates from the network to any device (TV, PC, Tablet, Smart phone et al.)
2. Transparent to user
3.  Simplifies home networking, re-use existing networks such as WiFi,  No need for a new technology.
3. Enables TV-Everywhere or video everywhere and advanced video services
1. A single seamless video experience across all devices/screens.
2. Pause on one screen; resume on another screen is simplified.
3. Watch “save” programming on any device at any location.
   
4. Enables location-based targeted advertising
1.  Ads can be “re-inserted” to location user is actually watching stored content.
2. No need to play Boston Ads if user is watching Red Sox game in San  Francisco.
3. Enhances advertising packages to ad buyers.
4. Enhances viewing experience of consumer since ads are more relevant.
5. Increases ad revenues
5. Reduces usage and congestion of upstream bandwidth
1.  Eliminates the need for Sling Box
1. Sling box clogs limited upstream last mile channels
2. N-PVR eliminates Sling Box zero revenue traffic
6. Enables SPs to take advantage of innovations in Content Delivery Systems and advanced caching technologies.
1. May already be implemented for Video on Demand.
7. Enables smart phone to become DVR controller
1.  Guide on smart phone delivered from network
2.   “record” in network
8. Leverages investments in cloud infrastructure
1.  ROI of data centers investment will be enhanced with the addition of N-PVR application. 
9. CAVEAT
1.  As N-PVR rolls out, cache’s and servers may find themselves in facilities that aren’t as friendly as purpose built data centers.  These may include regional and local facilities such as central offices and head ends.
2.  Energy issues (e.g., heat) should be addressed.
10. LEGAL Issue
1. The Cablevision litigation in the U.S. has been resolved in Cablevision’s favor.
2. Content providers argued it violated copyright laws.
3. Cablevision argued it’s the same as a DVR just a different location.
4. After a number of rulings and subsequent appeals the U.S. Supreme Court refused to hear the case ending the litigation.
5. Recommendation to SPs…Deploy! 
11.  Technical Issues
1.  SP’s will need to have the stored programming in numerous formats applicable to specific devices.  i.e., different resolution and data rates for an HDTV verse a smart phone via 4G/LTE.
2. Do you translate and transcode on demand or ahead of time? 

   To discuss these issues please contact me at gwhelan@greywale.com

   For a list of previous articles please see   http://greywale.com/articles