It was a week when Mobile Europe gave you insight into the plans and strategies of O2, Virgin Media, EE, Deutsche Telekom, and SFR, among others.
SFR, despite being in the midst of corporate reshufflings that would test the patience of many, continues on with an integrated network plan that includes free WiFi, free femtocells, HSPA+ nearly everywhere, and a slightly more vague LTE path (although it’s teeing things off in November in Lyon).
To match this increased network goodness, and some new devices that we won’t mention but end in 5, the operator also “rolled out” some new tariff plans.
Writing on the Yankee Group’s site, analyst Declan Lonergan picked up on the “multi-SIM” aspect of SFR’s new tariffs. Group data plans are not exactly a controversial topic in the industry, but they do cause debate. Just to remind you, a group data plan is where an operator offers a single user, or a family, or even a small business, a single tariff and usage limit that can be spread across a number of devices.
The upside is that you get that second and third connection that you may not have done otherwise. A teenager say, might otherwise go with a cheaper brand or PAYG provider, rather than coming in under the umbrella of a family tariff. A smartphone user may add his iPad to a slightly enlarged data tariff, rather than get only a WiFi version of the tablet. The downside is that it will have the apparent effect of destroying ARPUs, as 3 SIMs are under a €50 bundle, say, rather than 3x€35. However, there are those who point out that that €15 is €15 per month that the operator may well have lost out on. In that case, perhaps it’s the financia reporting metrics that now need to change.
Let Lonergan explain:
“Connecting multiple devices to the mobile network via shared data plans represents an enormous opportunity for mobile network operators. In the U.S., AT&T and Verizon have led the way with this type of offer, and their European counterparts are beginning to launch similar plans. Though customer adoption of shared data allowances across multiple connected devices will result in ARPU-dilution, there will be some important benefits for operators. The most important of these is the potential for reduced customer churn and growth in top line revenues. Customers will respond favorably to data sharing and we expect 2013 to be the year of shared data plans in Europe.”
One thing that is apparent: shared data plans are more common in the USA because they have LTE networks, with the spectral efficiency they entail, to make the data package more palatable to the in-house economists. As European operators begin to go down the LTE path, and more devices with LTE, and as in SFR’s case DC-HSPA capability, come along then we are likely to see operators feeling they have the headroom to redesign their pricing landscape to sweep up more devices under a single bill.
But let’s come back to SFR’s network plan, because it’s an example that we are on the edge of a network landscape (can you be on the edge of a landscape) that will include refarmed 1800MHz and 2.6GHz and 800MHz for LTE. HSPA at 900Mhz and at 2.1GHz. Small cells in the mix, both WiFi and in licensed spectrum, backhaul over….well backhaul over whatever works, seems to be the current mantra.
This week we saw Alcatel Lucent, which is trying to present itself as the one-stop-shop for the metro wireless network, add another backhaul string to its bow, with the addition of a 60GHz provider, Sub10Systems, so its supplier list. And we saw DragonWave announce live trials of radios with 2048QAM modulation providing Gigabit capacities on microwave links. Virgin Media, which presented at Avren Events’ Basestation Conference, is building a wholesale backhaul business on its fibre. O2, which also presented, is using 5GHz WiFi where it can, but adding in fibre (5GHz can’t always get to its rooftop sites) where it needs it, and is considering 60GHz as a small cell solution (pace Alcatel Lucent/Sub10).
Operators are still working this stuff out. O2’s speaker at the Avren event presented the backhaul options with an image of the wild west. Deutsche Telekom’s speaker said that he was still unsure how to cost backhaul into the small cell model. I think we’ll see a lot of this shake down over the next year because a) there will be more small cell trials in Europe and b) there are some big US public access small cell deployments coming that will test out the claims of the competing providers.
One thing that is also clear is that when you put small cells into an area, they get used. O2 gave us actual traffic volumes for its London deployment this summer. (By the way, just as an aside, it saw a near 40% increase in volumes during the Olympics compared to before and after.) Virgin said there have been 40 million “sessions” since it started turning on its WiFi in London, although it didn’t tell us how long most of those sessions are, or what users were actually doing. Given that most people are trying to get somewhere when they are in the tube, that’s still a lot of attempted sessions.
So deploying small cells for free access is a nice to have for consumers, but it gives operators issues. We mentioned backhaul, and we could throw in site acquisition which can be a terror, but there is also traffic management and mobility co-ordination – the business of how to connect people to which part of the network, to ensure service continuity and also quality. This is why we saw NSN present its vision of CEM for LiquidNet – combining customer experience insights with network intelligence to give operators tools to manage capacity and traffic flows. If you think this is all pie-in-the-sky marketing speak, note that Vodafone has a development programme in place to roll out a single SON architecture for its networks, and is working out which processes to centralise and which to push out to the edge. The whole aim is to be able to handle QoS as a differentiator, as well as operate as efficiently as possible. Accessing and processing the data to feed those SON engines will be key. That’s where NSN is going, as well as its competitors in the NEP space, of course, and many others that target different points of the data flow along the way.
So, small cells = consumers like them (well, like the effects), good capacities, offload and onload possibilities. They bring with them backhaul and logistical issues, and act as a catalyst for thinking about network co-ordination, automation, and plugging CEM into network management. It think that about sums it up. Have a browse through this week’s news items, as seen by Mobile Europe, to see how some of those issues are currently playing out.
Keith Dyer
Editor
Mobile Europe