CommsDay Magazine 4Q 2015

Q4 2015 • Published by Decisive • A CommsDay publication

Pictured: P3 communications’ Marcus Brunner and CommsDay’s Petroc Wilton

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30/09/2015 16:48

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More than a network

IN THIS ISSUE UPFRONT 5

When will we see UDC downunder?

9

Remote mobile coverage: How 3 regions stack up

11

The rise and fall of NewSat

COVER STORY 17

The 2nd P3/CommsDay Mobile Benchmark (13pp special)

FEATURES 30

Australia’s three mobile CTOs talk networks and technology

40

In search of higher frequencies

46

Mobile futures in Japan, China, USA and South Korea

About Communications Day (including the Line of NZ) Communications Day is the telecommunications news authority of Australia and New Zealand. Published daily since July 1994, CommsDay is expertly written and edited by a team of industry writers with a combined 80 years experience in technology reporting across Australia, NZ, Asia, the United States and Europe. CommsDay is available by subscription only and read by 10,000 industry executives as well as policymakers and parliamentarians every week day. This edition is a special magazine version of CommsDay. PUBLISHED BY DECISIVE PUBLISHING Mail: PO Box A191 Sydney South NSW 1235 AUSTRALIA. Fax: +612 9261 5434 Website: www.commsday.com THIS PUBLICATION IS COPYRIGHT AND ITS CONTENT CANNOT BE REPRODUCED OR DISTRIBUTED WITHOUT OUR EXPRESS PERMISSION. OFFENDERS CAN BE PROSECUTED. ALL RIGHTS WILL BE EXERCISED.

Contacting CommsDay Group Editorial Director: Petroc Wilton, petroc@commsdaymail.com, +61 2 9261 5436 Regional Editor: Geoff Long, Geoff@commsdaymail.com Editor at large: Tony Chan, tony@commsdaymail.com Assistant editor: Richard van der Draay, Richard@commsdaymail.com Columnist: Kevin Morgan, kevinlmorgan@bigpond.com Founder director: Grahame Lynch, Grahamelynch@commsdaymail.com Cover designed by Peter Darby Accounts payable, receivable: Linda Salameh, Linda@commsdaymail.com, 02 9261 1606 CommsDay Summit/Congress sponsorship: Veronica Kennedy-Good, veronica@mindsharecomms.com.au Satellite Forum sponsorship: Kevin French, kfrench@talksatellite.com

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UDC: will we see it down under?

With 5G still years away, the mobile industry is looking at new ways to boost network capacity and efficiency on existing networks – such as Uplink Data Compression. Richard van der Draay reports.

Even as the early buzz and speculation around 5G steadily builds, mobile operators are focusing more intently on extracting optimum performance from their 4G networks in the meantime.

An intriguing breakthrough in this space recently took place with the first commercial test of Uplink Data Compression, an LTE-Advanced compression technology tipped to boost uplink capacity by as much as 50% on 4G networks – at least those using the time-division duplexing variant of LTE. The more widespread type of LTE is frequency-division duplexing, which uses two different radio frequencies for transmitter and receiver operation; full data capacity is always available in each direction as the send and receive functions are separated.

But a number of large and influential operators in several countries, including one in Australia, are investing in TD-LTE – where the transmitter and receiver both use the same frequency but transmit and receive traffic is switched by assigning alternating time slots. Allowing the use of only a single frequency for operation, this opens up options to dramatically increase spectrum utilization – especially in licenseexempt or narrow-bandwidth frequency bands.

UDC aims to improve uplink efficiency by using an LTE modem to intelligently compress uplink data on the lower layers, based on network conditions and application traffic. The idea is to improve the efficiency of web applications and browsers, allowing operators to support more users on the uplink at any one time; according to vendor Huawei, it can

also enhance the quality of the web experience for users in weak signal areas.

In late August, Huawei and chip manufacturer Qualcomm completed verification of the new compression method, which Huawei is branding as TDD+, over China Mobile’s network in the Chinese province of Zhejiang. Huawei claims that – combined with other LTE-A enhancements such as multipleinput and multiple-output and 256QAM, a modulation scheme offering 265 possible signal combinations – UDC will help deliver gigabit mobile data speeds.

Huawei also says that the technology can be rolled out without having to change the hardware, simply by upgrading the Evolved Node B software on the network side – the hardware element of LTE connected to the mobile phone network that communicates directly with mobile handsets. And because it is part of the LTE modem, it is independent of a mobile device’s operating system, notes Huawei.

As UDC is part of the 3rd Generation Partnership Project which brings together a number of telecoms standard development organisations, Huawei expects most base station and LTE modem vendors to deploy the technology. Huawei initially proposed the system to the standards body and jumped in first with a verified test. It has announced it will start supplying commercial base stations featuring the capability by year’s end. Qualcomm, meanwhile, has flagged that its next generation of LTE modems, slated to be unveiled later this year, will support UDC. So what are Australian carriers’ thoughts on this type of data compression?

Perhaps best placed to comment is Optus, the only one to be actively using TD-LTE at present.

But acting networks MD Dennis Wong notes that broadly speaking, this type of uplink data compression technique is still proprietary and currently in the process

UPFRONT of being standardized in the industry – and that it remains to be seen how UDC could play a part in the Australian mobile market going forward.

“This kind of technology could be used for 4G or beyond, but it will depend on how it is standardised and whether it becomes part of the device manufacturers’ roadmaps,” says Wong. “Some user applications may have already used compression techniques on user-generated and uploaded data like images and videos.”

Still, Wong adds that Optus is always looking at new technologies to enhance customer experience, improve network capacity and boost performance – and will keep a close eye on the development of this particular compression technology, working with vendor partners to evaluate it.

“Optus sees value in continuing to extract the maximum performance out of our 4G network due to the constantly growing demand for data services and volume while 5G develops, in particular any innovative technology enhancements that our vendor partners are exploring such as UDC.” Vodafone, on the other hand, doesn’t currently have any TDLTE spectrum, with its own network exclusively FD-LTE – but CTO Benoit Hanssen says that the carrier is nevertheless keeping track of UDC-type developments and uses similar compression techniques on FDD. “We expect that very soon actually the equivalent of that [UDC] feature will come out [for] the FDD customers of Huawei as well,” he notes.

A compression methodology of this kind, adds Hanssen, would not typically be a major challenge for Vodafone to implement on the network side. “Nowadays we can do mass deployments across the network; it’s a matter of testing the features and then it’s a few weeks of deployment across all the sites that we have.”

“[But] it’s not just the network that needs to be supporting these kinds of things, it’s also the phones... typically, a new feature would also come with a next generation of phones, but then people change phones only every two years. The pace at which technology gets deployed is typically set by the pace at which people adopt the new phones that support these features.”

More broadly, Hanssen expects a number of 4G enhancing features to be launched every year until 5G hits the market, expected to be somewhere around 2020. “We’re obviously very keen on getting more mileage out of the expensive frequency investment that we make!” he says. “At Vodafone we do about one major release a year which contains all the new features that have been developed that particular year.”

And while Vodafone itself is not involved in developing those features, Hanssen adds that it nevertheless works with the likes of Huawei to define the roadmap in the longer term. “We do help them prioritize and indicate in which direction we want to go as an industry.”

Telstra networks GMD Mike Wright, meanwhile, notes that uplink data compression has been done before, in the 3G world. “In the early days of 3G, the uplink was a fairly narrowband channel and, particularly as we saw huge amounts of traffic hitting some of the 3G networks, one of the early issues was the ability of the uplink to keep up with acknowledging the downlink packet.”

But like Vodafone, Telstra has an exclusively FD-LTE network at present, and Wright says that for the moment there’s no great urgency to squeeze more capacity out of the uplink. “FD-LTE... doesn’t necessarily struggle with having to proportion downlink versus uplink,” he says. “At the moment, we’re seeing plenty of uplink bandwidth [and] more use on the uplink... over time we’ll start to use things like higher or-

der modulation, and we’ll even do carrier aggregation on the uplink.”

That could mean that, even if an FD-LTE equivalent for UDC becomes possible, it might not be necessary. “Usually, these things come out when you’re trying to solve an issue,” he said. “I would argue for the moment that FDD hasn’t got a material issue; it’s more specific to try and take advantage of a TD world,” says Wright.

Remote mobile coverage: how Australia, Papua and Africa stack up Australia’s expansive geography presents significant challenges around mobile coverage in more remote areas; the federal government’s Mobile Black Spots program is the latest response. But other jurisdictions are tackling remote coverage in some very different ways. Richard van der Draay reports.

In Australia, mobile coverage of remote and rural areas has been a hot topic of late and looks set to remain so for the foreseeable future. But Australia is not the only part of the world faced with major geographical challenges related to its vast size and dispersed population centres – and might, perhaps, be able to draw inspiration from approaches overseas.

A key plank of the federal government’s strategy to provide remote Australia with mobile services is its Mobile Black Spots Program, which has seen it partner with telcos and state authorities to build and improve some 500 mobile phone base stations to ensure coverage for regional, remote and outer metropolitan areas.

In the run-up to the 2013 election, the federal government

pledged A$100 million for black spot projects. This funding has since been supplemented by state and private sector spending, bringing the total commitment to A$385 million. The scheme will see Telstra rolling out 429 base stations while Vodafone will be able to install or upgrade a further 70 sites. Under the terms of the program, the mobile network operator selected to build each base station must offer its counterparts the chance to co-locate on that base station, prior to determining its design.

The government has subsequently announced a second round of funding for the initiative, hoping that A$60 million in additional Commonwealth funds – already accounted for in the 2015-16 budget’s contingency reserve – will leverage a comparable contribution from the states and the private sector.

Papua But how are other countries grappling with vast inaccessible geographies dealing with this particular challenge? An intriguing and very different example of a lowbudget approach using a fair measure of ingenuity has popped up in the remote highlands of Papua, Indonesia – a four-hour drive from the nearest mobile coverage. Described as a kind of guerrilla telecom network, a daring new research project operates a cheap base station – literally roped into a treetop.

The ‘Village Base Station’ project was set up by a team from the University of California, Berkeley headed up by graduate student Kurtis Heimerl, who is also a developer at San Francisco’s Range Networks. The tech adopted by the research project is based on OpenBTS, an open source software initiative “dedicated to revolutionizing mobile networks by substituting legacy telco protocols and traditionally complex proprietary hardware systems with IP and a flexible software architecture.”

The resulting network is oper-

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ated by a tiny stand-alone telco firm called Endaga, which is run by a local NGO and uses a laptop for local billing. The project was built in part using existing infrastructure: a small hydro-power generator and a satellite dish supplying internet connectivity to a local school. The Berkeley group added a base station for local mobile connectivity, a battery for night-time usage and a Wi-Fi router for a local internet hotspot. It kicked off this year with an initial US$10,000 investment and now has 187 mobile subscribers and an average of US$830 per month in revenue, including US$368 in profits.

The network-in-a-box service relies on Swedish phone numbers because no local telecoms company would provide them. “We needed phone numbers that could route to Indonesia and of those available on our VoIP partner Nexmo, only Sweden worked,” says Heimerl. “It’s a telco-in-a-box that we put in a tree; it’s a demonstration that these populations can profitably and sustainably manage their own networks. We don’t need telcos to do this; these communities can do this by themselves.”

That said, the venture ultimately aims to drive traditional telcos to reinvent their approach to the challenge of mobile coverage in inaccessible areas to the point where Endaga could attract support from the major carriers.

“Endaga provides a solution that allows the telcos to license their spectrum and numbers to local operators. This benefits both sides; the telcos can’t cover these areas economically [while] the local actor can. The telco gains customers and the actor runs a business,” says Heimerl.

Some commentators believe that the low-cost, low-power technology used could also provide a new model for self-managed last mile mobile coverage in the world’s hardest-to-reach areas where traditional top-down telecoms business models don’t work. And indeed, Heimerl says the research opens up the possi-

bility to connect millions of people who are just too remote and scattered to be of interest to telcos. “In our experience, most countries have rural access issues, not just the developing world; my home state of Alaska is another example and this model is the only way to resolve that in a sustainable, scalable manner.”

But, while the researchers say they’ve won tacit approval for the project from senior figures in the Indonesian government, it currently has no formal license – and gaining legal access to available spectrum, without needing large amounts of money upfront for a license, will be crucial to expanding the concept elsewhere.

“We’re currently in the midst of

negotiating carrier partnerships in a few countries to enable legal operation,” says Heimerl.

“Licensing is the key limiter for the model, but recent regulatory changes such as the unlicensed 3.5GHz band signal that the future is going to be easier.”

Heimerl says the project group is now shifting its focus to the Philippines and Pakistan instead of Indonesia as it has better carrier connections in those countries. The group has also already talked to several global telco providers and regulators. “Their response has been universally positive and supportive,” he notes.

“They know this is a huge issue to which there’s no good existing

solution. The issue is the exact mechanism of partnering as the locally owned model is so different from the standard centralized model of access.”

“I think our locally-owned mobile system would be very useful in Australia, we’ve talked to a few people there already,” adds Heimerl. “They were working with some of the Indigenous populations in the centre of the country.”

Africa In Africa, meanwhile, the lack of fixed-line infrastructure has seen mobile adoption take off exponentially. In 2000, the whole of sub-Saharan Africa as a whole numbered fewer telephone lines than Manhattan. Fixed-line networks hardly reach the remote rural areas where a major proportion of the African population lives. Of about 400,000 rural settlements estimated to exist in Africa, fewer than 3% have access to traditional public switched telephone networks.

Mobile telephony providers have taken advantage of this situation, implementing an aggressive diffusion strategy for mobile networks. In 2006, 45% of rural settlements in Africa had GSM coverage. In recent years, coverage has reached 90% of the territory in several countries, including Comoros, Kenya, Malawi, Mauritius, Seychelles, South Africa, and Uganda. Other countries which in 2007 exceeded 50% GSM coverage included Botswana, Burkina Faso, Burundi, Cape Verde, Guinea, Namibia, Rwanda, Senegal, Swaziland, and Togo. As a result of a wider distribution of GSM networks over fixedline networks, so-called mobiletelephone booths are a common sight in African regions.

In terms of subscriber numbers, mobile telephony is already both more widespread and more profitable in Africa than fixedline phone services. The fixedline market in Africa is generally based on monopoly, often stateowned, with a few incumbent operators who have not invested in

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extending their networks much beyond the larger metro areas.

While this situation is changing – for instance both Telecom Kenya and Botswana Telecommunications Corporation have been privatized and a market liberalization strategy has been launched in several countries – the mobile telephony market is generally more competitive and dynamic.

So can we draw any lessons from overseas strategies that we might use in the Australian context? According to telecommunications expert professor Reg Coutts, the Black Spots Program is a step in the right direction to boost mobile coverage by using the funds to stimulate additional spending by the mobile carriers as well as local regional communities. “This ‘smart subsidy’ approach was shown to be cost effective to provide rural coverage in Chile in 2005… we are slow to learn,” Coutts tells CommsDay. “[But] it’s an improvement!”

However, Coutts flags some remaining issues in relation to the program. “State governments have done deals with Telstra to secure mobile funding from [the telco],” he says, referring to the Victorian government and the seat of Indi. “State governments – for instance West Australia and the Northern Territory – have been awarding funding to Telstra without any consideration of the ongoing erosion of competition from Vodafone and Optus.”

Coutts also touches on the rollout of the national broadband network’s fixed wireless infrastructure in regional areas, which “for the first time in Australia’s history is bringing faster broadband to those outside the cities and towns.” However, he says that while the NBN’s uniform wholesale pricing model is unique in the world, it doesn’t go far enough to facilitate competitive mobile coverage. “The idea of a single wholesale mobile infrastructure is [currently] being considered in Mexico and South Africa,” he notes.

The rise and fall of NewSat When creditors of bankrupt satellite operator NewSat last month voted to wind up the company and its six subsidiaries, it marked the end of a 10year effort that almost culminated in Australia gaining another fullyfledged commercial space operator.

While the efforts to get Jabiru-1 just shy of its launch took a decade, the fall back to earth was far more rapid.

Geoff Long details the full story.

Just on 10 years ago, an unlikely company took its first steps towards operating its own satellite.

The then e-commerce, internet and ICT distributor firm Multiemedia signed an agreement on 25 August 2005 to acquire the assets of New Skies Networks Australia from Netherlands-based satellite operator New Skies Satellites. For a neat US$10 million, it gained teleports in Adelaide and Perth as well as satellite capacity and a number of guaranteed contracts for its new teleport business. On that day the Melbourne-based satellite business was born, with the name changed to NewSat the next year.

Multiemedia was an unlikely buyer because it lacked the satellite pedigree to operate two relatively large teleports. However, at the time New Skies was preparing for its main European operation to be acquired and a quick sale of far-flung assets was to its advantage. It wasn't just Multiemedia's satellite resume that needed bolstering – as a product of the dot-com era it also had a financial background that could be best described as “colourful.”

A lot has been written recently about NewSat's approach to business as it tried to build and launch its A$620 million Jabiru-1 satellite project. However, if you look at the company's past you'll see history repeating itself.

The company was founded by the now well-known Adrian Ballintine. At the time his partner was Paul Allen, who notably start-

ed Microsoft with Bill Gates.

Multiemedia didn't enjoy any Microsoft-like success, however. On the contrary, it racked up a string of losses and ended up a regular in the media thanks to a number of court cases rather than for its business wins. Australian TV personality Steve Vizard once sat on the company's board, but had a very public falling out after dumping over $1 million worth of shares just weeks after being appointed to a lucrative director's position. Another director from that time, Clinton Starr, was successfully prosecuted by the Australian Securities and Investment Commission for not disclosing his trading in the company's shares. The company had been forced to write down a number of businesses shortly after its listing on the Australian Securities Exchange, including the 2001 acquisition of Sportsview. And its ASX past also included notifications of breaches of loan covenants with ANZ – something familiar to today's burnt shareholders, who can blame their losses in part on NewSat's breaches of more recent loan covenants.

Jabiru dreaming Had NewSat and its founder Ballintine been satisfied with operating satellite teleports, the company's story might have been a successful one. However, its move to launch its own satellites was always going to be risky. After all, gaining entry to the exclusive club that is the satellite operator market is not for the meek. The price to play is in the billions and the risk of failure is equally high; the fact that a relatively small Australian company came so close speaks volumes for the tenacity of those that were involved in the venture. But again, there was always an element of “colour” to the story.

One of the key questions that industry watchers had asked of the company is where it would get the orbital slots needed to launch a satellite. That it was able to do a deal with an intermediary

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company to get slots allocated to the Government of Cyprus seemed to surprise a number of people, given that those orbital slots are a fairly rare commodity.

The intermediary was Cyprusbased AP Kypros Satellite, itself a shareholder in NewSat that ended up losing money.

In a previous interview with CommsDay, Ballintine claimed one of the reasons his company got the slots was because it was willing to use rather than hoard them, providing a revenue stream to Cyprus in the process. “The other space companies in the world were shocked when we picked those slots up because they wanted them, I mean everyone wanted them. They were a jewel for everyone to get and we managed to get them,” he noted.

“And I think one of the reasons we managed to get them is because the Republic of Cyprus actually believed that we would utilise them and go and deploy satellites in them faster than other people and because they [would have been] receiving a trailing revenue on satellites that we launched.”

Financial underpinnings For a while, it looked like Cyprus might have backed a winner. Ballintine and his executive team went on to do something else that was quite remarkable for such a small company with limited satellite credentials – raise the funding needed to bankroll the estimated A$620 million Jabiru-1 launch.

Almost US$400 million of this came from two governmentbacked export-import financiers: the US Export-Import Bank and France’s Compagnie Française d'Assurance pour le Commerce Extérieur. The incentive for providing the finance was simple – it was seen as a business generator for major US and French companies respectively. For the US, Lockheed Martin got the contract to build the satellite, while Europe's Arianespace was awarded the launch services contract.

However, it was not just the government-backed finance that came NewSat's way. It also attracted both individual and some significant institutional investors – particularly from Singapore.

NewSat's largest shareholder was Ching Chiat Kwong, one of the island nation's wealthiest men.

His property company Oxley Holdings is best known in Singapore for a string of so-called ‘shoebox apartments’ that created much of his wealth. Another major Singaporean investor was Bryan Yap, a former head of Deutsche Bank Singapore. In terms of signing up business for Jabiru-1, NewSat had raised more than US$600 million in prelaunch contracts. One of its most significant was with Malaysia's MEASAT, which signed a 15-year $US180 million contract for capacity on the satellite.

A revenue-generating teleport business, government-backed finance, orbital slots, pre-launch contracts in place and a satellite that was 80% built with a guaranteed launch contract in place – to most observers, NewSat had its first satellite launch in the bag.

How could things go so wrong, so quickly? According to the administrators brought in to try and salvage the company, Sydney-based PPB Advisory, it was a series of smaller problems that together became insurmountable. The group experienced significant cash flow problems and a weak-

ening balance sheet from FY14.

This was driven by a decline in the teleport business performance, costs associated with unutilised satellite capacity and the group’s inability to draw on debt to pay Jabiru 1 satellite construction costs. And of course there were the “management issues” that had long dogged the company and which had resurfaced in reports in the mainstream media.

The beginning of the end Ironically, it was a financial raising in FY14 that really started the spiral. NewSat had raised mezzanine debt to fund working capital for the teleport business in contravention of its credit agreement, which triggered a default on the existing debt with its lenders. According to the administrators, this default, coupled with cost overruns on the Jabiru-1 satellite programme and other corporate management issues, led to the suspension of debt funding despite several wavier attempts.

You could also pencil in 16 December 2014 as one of the key dates from which it seemed there was no way back for the company; this was the date that Lockheed Martin issued a default notice in respect of the Jabiru-1 satellite construction contract.

Arguments have been made that the directors could have called in the administrators at this stage.

In the end, it wasn't until April

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this year that the lenders called in the receivers and the company looked for protection from its creditors.

PPB Advisory said that its preliminary view was that the directors of the company did not trade while insolvent during that crucial period between Lockheed Martin issuing its default notice and April when it took over the company. However, it also noted that further investigation could be needed to unearth the full story. Even with the administrators called in, shareholders and creditors were still hopeful that a solution could be found to keep the company intact.

A submission to the US bankruptcy court in Delaware in midApril by Richard Brail, MD and head of the technology, media and communications advisory practice at New York investment bank Peter J Solomon Company, raised those hopes further. He told the court that there was a “reasonable prospect of achieving additional financing” to revive the Jabiru-1 satellite project. He told the court that PJSC had already contacted over 30 potential investors, comprised of both financial and strategic investors.

PJSC had even worked with the receivers to set up a data room in Melbourne that provided the non -public information, while NewSat personnel were made available to potential investors.

“On the basis of my experience with the NewSat financing process to date, while the terms and conditions of any financing proposals NewSat may receive are unknown and acceptance of any proposal is dependent upon the exercise of business judgement of interested parties, I believe there is a reasonable prospect of achieving additional financing to support the Jabiru-1 satellite program,” Brail told the US court.

“Furthermore, I believe a comprehensive solution that assures financing through the completion of the program represents the best outcome for all stake-

holders.”

But Brail also had a warning that proved to be well-founded.

He told the court that the maintenance of the full suite of Jabiru-1 contracts was essential to achieving financing, and stressed that investor interest in providing financing would be significantly diminished if either the satellite construction contract with Lockheed Martin or the launch services agreement with Arianespace was terminated. For NewSat's long-suffering shareholders, the news was about to get worse very quickly. While PPB Advisory had been able to gain temporary restraining orders against its major creditors, it was unable to come to a deal with potential investors in the short timeframe that it had. Nor could the receivers obtain funding to meet ongoing costs of trading the business and building the satellite.

In late May, Lockheed Martin cancelled its construction contract, which in the words of the administrator was the “catastrophic” event that lead to the final collapse of the company.

“As Lockheed Martin retained ownership rights in the satellite until it was paid for in full, there remained no residual value in that asset after that point. This in turn had a catastrophic impact on the restructure,” the administrators noted.

The sell-off As a result, the receiver pursued one of the few remaining avenues open to it: an asset sale programme. However, as shareholders learned, there were not a great deal of assets to sell, particularly as Lockheed Martin retained ownership of the 80% completed satellite. Another asset mentioned, the launch services agreement with Arianespace, did not attract buyers and was subsequently terminated in August.

The one asset that they could sell was the teleport business, which was sold to Hong Kongheadquartered SpeedCast for

A$12 million. So almost exactly 10 years after Multiemedia/ NewSat bought itself entry into the satellite sector with the assets of New Skies Networks Australia, the teleports were off-loaded again for more or less the same money. Unfortunately, shareholders, employees and creditors are unlikely to appreciate the irony.

On the 7 August 2015, creditors formally voted to wind-up the company and its six subsidiaries, bringing to an end its dream of becoming Australia's first independently-owned satellite operator. The story may or may not end there: Some of NewSat's biggest former shareholders will hang around to oversee efforts to pursue certain transactions as well as potentially investigate former directors over any wrongdoings. Creditors voted to create a high-powered “committee of inspection” that can work with the liquidator to further investigate the group.

Members of the committee include the two Singaporean investors, Chiat Kwong Ching and Bryan Yap, while other members of the committee will represent the interests of the US Export Import bank, the project's largest lender, as well as a number of other banking interests.

However, NewSat itself is gone. The administrators had received no deed proposals from any parties that would keep any of the company's structures intact. A number of parties had expressed an interest in purchasing the listed status of the company as a cheaper way of listing on the ASX, but the administrators said the return to creditors would have been “infinitesimal” and had not been pursued.

And having not paid its annual listing fee to the ASX, the firm was officially delisted at the close of trading on Monday 31 August 2015. An ignominious end for a once promising company.

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SPECIAL 13 PAGE REPORT with full test results and methodology

This year’s benchmark W

elcome to the 2015 P3 CommsDay Mobile Benchmark: an in-depth objective comparison of the user experience for voice and datata on Australia’s three mobile networks, operated by Vodafone, Optus and Telstra.

In its second year, the benchmark is more relevant than ever.

Google’s latest Connected Consumer Survey found that 77% of Australian respondents were using smartphones, making it one of the highest-ranking countries in the world for smartphone penetration – ahead of the United States, China and the United Kingdom – and other estimates put the numbers even higher.

The huge popularity of cutting -edge handsets, combined with

bandwidth-hungry applications like mobile video, is driving a corresponding surge in mobile data consumption. The Australian Bureau of Statistics reported an average of 0.84GB per subscriber per month downloaded on mobile devices in the three months to December 2014, up 91% yearon-year. Many are hungry for more, as suggested by the 20GB data allowances on the latest premium mobile contracts.

All of this means that customers are demanding higher and higher performance not just from their devices, but from their mobile networks as well. And over the last year, Optus, Vodafone and Telstra have spent billions of dollars to meet that challenge, with new technology strategies

that have now started to yield measurable results. This benchmark provides an insight into what those upgrades mean in practice for the smartphone user.

Over the following pages, you’ll find an overview of what’s changed in the mobile network landscape since we ran the last benchmark, how we’ve updated our testing methodology to reflect those developments, and how we’ve expanded this year’s measurement route to take in even more of Australia – from Brisbane to Sydney, Adelaide to Perth. You’ll also find a full breakdown of the raw test data, drawn from a massive set of around 150,000 individual samples taken over four weeks of scientific testing.

P3 communications P3 communications is a leading international consulting, engineering and testing services company. It is part of the P3 group, which has over 2,700 employees worldwide and posted a turnover of more than 270 million EUR in 2014. The company provides a broad portfolio of independent technical and management consulting services including network planning, engineering, end-to-end optimisation, security, QoS and QoE testing, international benchmarking, device testing and acceptance services. P3 communications’ clients include network operators, equipment vendors, device manufacturers, public safety organisations and regulatory authorities around the world. P3 has been conducting public mobile benchmarks in Germany since 2002 and in Austria and Switzerland since 2009; it introduced public benchmarks in Australia and the UK last year, and in the US and the Netherlands in 2015. In 2014 alone, P3 communications compiled about 50,000 measurement hours in 42 countries across five continents, with test vehicles covering almost 1 million km/

CommsDay Communications Day is the primary source of news, information and analysis for the telecommunications industry in Australia and New Zealand. Launched in 1994 as a daily journal, CommsDay is now read daily (and frequently cited as a reference) by thousands of senior executives, ministers, policymakers and regulators across the sector. The brand has also expanded to include a digital magazine and an annual program of major conferences in Sydney and Melbourne.

Written by: Petroc Wilton Principal benchmark responsibilities, P3 communications: Marcus Brunner, Ralf Pabst Benchmark and testing coordination, P3 communications: Premysl Zelenka, Maziar Kianzad Final edit and report design & production: Grahame Lynch Photography: Munir Kotadia Cover: Peter Darby, Munir Kotadia

Going bigger: updating the benchmark for 2015

W

hen we launched the P3 CommsDay Mobile Benchmark last year, we set out to provide a unique resource for consumers: a totally independent and impartial comparison of Australia’s three mobile networks, unprecedented in the scope, detail, and scientific rigour of the testing that underpinned it.

After all, when the smartphone is an essential part of life for so many Australians – with current estimates of between 70% and 90% penetration – even the most cutting-edge device needs a quality mobile network to support it with fast data transfer, smooth video streaming and reliable voice calls. So when you’re thinking of buying a new phone, it should be as easy to compare mobile networks in detail as it is to read reviews of the latest handset.

Released in October 2014, the first Benchmark was based on

weeks of intensive network testing all around the country and was well received by the press, consumer organisations and even the mobile operators themselves.

We’d worked closely with them in designing the tests and the in-depth results highlighted their individual strengths, as well as areas for improvement.

All of them invest continuously into network upgrades to enhance the mobile customer experience, but these are often highly technical in nature and difficult to communicate to end-users; part of the function of the benchmark is to demonstrate how those investments translate into measurable results.

But the benchmark was always intended to be an annual exercise. Mobile technology is evolving very rapidly and Australia is one of the most advanced markets in the world. Regular testing is important to show how the lat-

est innovations are actually improving performance for the enduser from year to year – comparing the Vodafone, Telstra and Optus networks not just to each other, but to their own respective performance scores in last year’s report.

We’re also working constantly to improve the benchmark itself.

We look at feedback from all operators to make sure that our scoring reflects the state of the art in available mobile technology, and that our testing is as representative as possible.

That’s why in 2015, for the second edition of the Benchmark, we decided to go bigger.

A REVOLUTION IN MOBILE TESTING The key challenge for thorough mobile network testing in Australia lies in the sheer size of the country. Its population of almost 24 million people is distributed

around a landmass of 7.7 million square kilometres, with most people concentrated in the big cities around the east, west and southeast coastlines but a significant proportion living in more remote areas. Even with four weeks of dedicated drive testing – using pairs of measurement vehicles equipped with P3’s custom hardware and software – the logistics of planning a test route to capture the mobile network experience for all Australians can be daunting.

Despite these challenges, we’ve been able to massively expand the geographic area covered by this year’s benchmark, with our measurement route representing more than two thirds of the Australian population. That’s all been made possible by one of P3 communications’ latest innovations: the Antenuatr.

Attenuation is a reduction in the strength of mobile phone signals. In the real world, it is caused naturally by factors such as increasing distance between a given device and a cell tower, or by the signal passing through obstacles such as walls. Because the benchmark is meant to reflect actual end-user experience, it’s important to represent attenuation.

For the 2014 tests, all smartphones were set up with 12dB attenuation to reflect realworld conditions, such as users sometimes moving into buildings. But that also required connecting them to bulky hardware

and using banks of external antennas – eighteen mounted on the roof of each test vehicle – resulting in a considerable setup time for the vehicles themselves.

With huge distances to cover around Australia and a very tight testing timeframe, that all made it necessary to measure in a continuous loop around part of the country, putting areas such as Western Australia out of reach.

For the 2015 benchmark, however, P3 developed the Antenuatr: a compact piece of patent-pending hardware that can securely house an array of test phones, while also simulating a degree of attenuation comparable to last year’s measurements without the use of external antennas.

The only other elements required for testing are a small scanner which checks signal strength for control measurements (and which does come with a single pair of dedicated external antennas of its own), plus a couple of laptop computers hooked into the Antenuatr to actually collect the test data.

With the Antenuatr technology, P3’s testing is even closer to actual end-user experience. After all, very few mobile phone users connect to external antennas.

But more importantly, the whole set of testing equipment is compact enough to fit in a small suitcase, and very quick to set up and mount in almost any car. That has made it possible for us to fly the hardware into any location

with an airport, get it up and running in a fresh pair of hire cars within a few minutes, and immediately begin testing – putting locations such as Perth within reach for the first time.

LOGISTICS AND ROUTES Thanks to the ‘fly-in, fly-out’ approach to testing enabled by the Antenuatr, we were no longer restricted to testing around a single loop, giving us the flexibility to cover much more of the country.

Testing was conducted in Toowoomba, Brisbane, the Gold Coast, Robina, Byron Bay, Lismore, Coffs Harbour, Port Macquarie, Newcastle, Sydney, Wollongong, Canberra, Queanbeyan, Albury, Wodonga, Melbourne, Geelong, Ballarat, Adelaide, Perth and Bunbury, as well as on connecting roads and highways.

A significant expansion on last year’s tests, the route was carefully optimised with reference to Australian Bureau of Statistics population data and in consultation with the operators themselves, in order to provide the most representative overview of customer experience possible.

This year, our test vehicles covered close to 17,000 test kilometres between them – almost double the 9,000 test kilometres for last year’s benchmark. The total measurement area for the 2015 tests represented roughly 70% of the Australian population, up from around 50% last year.

Methodology: reflecting a key year for mobile

S

ince we published the last benchmark a year ago in 2014, all three operators have made significant investments in new technologies and additional resources to improve the performance of their mobile networks.

Of course, all of them are continuously improving hardware and upgrading software to enhance the user experience, as well as working on physically building more infrastructure to expand their coverage. But perhaps the most important change has been the deployment and innovative use of extra spectrum – a critically important resource for any mobile operator.

Sometimes referred to as the ‘airwaves’, radiofrequency spectrum is that specific part of the electromagnetic frequency range used to broadcast wireless signals for things like radio, TV and mobile phones. Operators pay significant licensing fees to the government for the exclusive use of certain frequencies, which makes sure nothing else can interfere with mobile phone communications.

From the point of view of the end-user, generally speaking, having more of that spectrum available opens up more bandwidth for data transmission – which means faster mobile internet.

And specific frequencies of spectrum also have additional advantages; mobile signals on lowerfrequency spectrum, for example, transmit better over long distances and penetrate walls more effectively, which means better service for people using their devices indoors or out in regional areas.

That also, unsurprisingly, makes this premium low-frequency spectrum more expensive .

Back in 2013, in an auction run by the Australian government, Optus and Telstra paid almost two billion dollars between them for the licenses to use some low-band 700MHz spectrum, as

well as some cheaper spectrum in the 2.5GHz band (Telstra bought twice as much as Optus).

They were both able to start using it nationwide for 4G mobile from the start of 2015, after bringing it online in some earlyaccess areas at the end of last year. Telstra’s service using the new spectrum is called ‘4GX’, while Optus’ equivalent is referred to as ‘4G Plus’ – both promising faster internet access and a better experience for users with compatible devices.

Vodafone didn’t buy any spectrum at auction, which has cost it the advantage it once enjoyed in larger low-band spectrum holdings in some major cities.

However, it has stepped up to the challenge by re-allocating a good portion of its existing lowband 850MHz spectrum, previously dedicated to 3G, for use on its 4G network.

‘Re-farming’ spectrum in this way is quite normal as users shift onto newer mobile technologies, with Telstra for example having similarly repurposed some of its 2G 900MHz spectrum for LTE. An additional upside to Vodafone’s strategy is that the majority of devices already in use in Australia are 850MHz-compatible, meaning most of its customers haven’t needed to upgrade their devices to benefit.

Optus, meanwhile, has a unique edge of its own because it has access to 2300MHz spectrum for TD-LTE. That’s a slightly different type of 4G technology, deployed in countries like Japan and India, that Optus is using in addition to the more common FD-LTE to add both capacity and coverage in certain areas.

But simply adding more spectrum isn’t the only way to get better performance out of the airwaves. Since we ran the last benchmark, all three operators have also deployed different variations of what’s known as ‘carrier

aggregation’ – joining together separate chunks of spectrum in different frequency bands to achieve higher data speeds and a more consistent performance.

The technique is often compared to adding more lanes to a highway to allow for more traffic.

It’s important to note that the operators have brought in many of these advances in different places around Australia at different times, and that users will need up-to-date handsets to take full advantage of some of them.

It’s also worth mentioning that while some of the hype around these new technologies focuses on the maximum theoretical speeds for mobile internet access – sometimes in the hundreds of megabits per second – those speeds can vary in the real world depending on radio conditions, and will be ‘shared out’ between large numbers of people using the network simultaneously.

The operators are investing in these technologies to ensure a consistent, good quality experience for all their users at the same time.

All that said, the benchmark is designed to put the most cuttingedge mobile network technology available to end-users through its paces, with the most challenging use cases. So we designed this year’s tests to reflect all of these advances.

THE SMARTPHONES Just like last year, the smartphones used for the testing in each year’s Benchmark were carefully chosen – after consultation with operators – as widely available handsets that demonstrated the best possible performance on the commercial mobile networks, compatible with the latest technologies deployed by each operator.

For 2015, we used the same two models of device for testing all three networks: the Samsung

S5 Cat 4 smartphone for voice testing, and the Samsung Note 4 Cat 6 smartphone for data. The Note 4, for example, supports the 700MHz spectrum that both Telstra and Optus bought at auction in 2013, but also the dual-carrier aggregation technology that all carriers have deployed to boost speeds, and even the special TDLTE technology that Optus uniquely uses in parts of its network to improve performance.

We used commercially obtainable firmware for the phones corresponding to the original network operators’ branded versions. We also chose some of the most fully-featured tariff plans on the market in consultation with the operators. Optus, Telstra and Vodafone themselves provided most of the SIM cards for testing – and made sure that any fair use policies, sometimes used to control download speed for highusage customers, would not compromise the test results. However, our staff also anonymously purchased SIM cards for testing as a control, which were used for 10% of the tests to ensure the supplied SIM cards exactly matched those available in stores.

THE TESTS Just like last year we used paired test vehicles, kitted out with P3’s measurement equipment, to collect all of our data for the 2015 benchmark. They took the same overall routes around the country in parallel, but never in the exact same place at the same time to avoid any risk of one car distorting the measurements of the other; they also took different routes within cities to maximise the area covered.

This year’s benchmark was based completely on drive testing.

P3 has found that in practice, particularly while moving around CBD areas with frequent stops at road signals or in traffic jams, continuous drive testing actually yields a realistic blend of stationary and mobile network access.

Testing in larger cities included a focus on key locations such as airports, business districts, and heav-

DATA MEASUREMENTS In line with current developments in the market, we measured data performance this year entirely in 4G-preferred mode on the Telstra, Optus and Vodafone networks.

Each operator still maintains a 3G network as well, but since the initial launch of 4G in 2011 the faster mobile data technology has

erence pages; standard and highdefinition YouTube videos; and a whole battery of upload and download HTTP file transfer tests. We ran 1MB file uploads and 3MB file downloads to simulate the transfer of small files like photos, smartphone apps or images, and also ran a ‘peak test’ where we pushed as much data through the network as possible over a continuous ten-second window to allow for some rampup time – letting the three carriers really show off their maximum speed capabilities.

Stability and reliability are by far the most important aspects of mobile data; a user will certainly appreciate high speeds, but it’s absolutely critical that emails at least send successfully, web pages

become hugely popular.

Millions of Australians use 4G when they have the choice and can do so across most of the country, the majority of handsets available to buy today are 4G compatible, and the bulk of the network investments made by the operators focus on expanding the coverage and performance of their 4G footprints.

Of course, 4G-compatible devices will still fall back to the older 3G network if it’s all that is available in a given location; since we tested extensively in smaller towns and connecting routes as well as the major metropolitan areas, this was reflected in the measurements.

As with last year, we tested the performance of each network in accessing some of the most popular web pages, as well as static ref-

load without timing out, and so on. On the other hand, if a web page takes a really long time to load or a file takes much too long to transmit, a mobile user is likely to give up and try again.

Therefore, we updated the test scoring framework with the concept of ‘qualifiers’. Test samples had to meet a minimum set of requirements to qualify, based around successful data transfers and in most cases threshold speeds. Web pages, for instance, had to load successfully and within a minimum timeframe; upand download samples had to transfer successfully above a certain speed; YouTube videos had to download successfully, with no more than a set number of interruptions of a certain length.

To reflect the critical importance of stability, the percent-

ily populated residential districts – places where the sheer number of people using their handsets could be expected to really put the mobile networks through their paces.

This year, we set up one smartphone per operator per car to measure data performance, and two for voice.

age of these qualifying samples was the most heavily weighted metric in each set of tests. For all qualifying samples, we then also measured performance indicators such as the average session time to access web pages or transmit small files, throughput rates, and average startup times for YouTube videos. These ‘differentiators’ – mainly based around mobile data speed – are what really separate the user experience on one network from another, assuming both networks provide a basically stable and reliable experience.

VOICE MEASUREMENTS Voice testing was a little more complicated. The 4G standard was not originally designed to natively support voice – which means that when a phone in 4Gpreferred mode makes a call, it actually uses a technology called Circuit Switched Fallback (CSFB) to set up the connection on the 3G network instead. But that can cause some problematic sideeffects; the transition between 3G and 4G can result in paging problems and delays to call setup times. And if users are downloading data (such as emails) at the same time as making the call, they’ll drop to 3G data speeds until the call is finished.

The commercial release of native Voice over LTE (VoLTE ) should solve these problems, but VoLTE was not available on any operator’s network at the time we began testing.

To accurately simulate realworld conditions, and reflect the impact of CSFB, we tested calls from 4G to 4G phones and from 3G to 4G. One of our two vehicles had two voice test phones per operator set to 4G-preferred mode; the second vehicle had one voice phone per operator set to 4G-preferred, and one set to 3G-preferred. All of the voice testing was based on mobile-tomobile calling between the two cars, across a combination of the 3G and 4G configurations, and the test scores reflected the aggregate performance across both

types of call.

The voice use cases simulated by our testing were fairly demanding. The phones were constantly mobile and all voice testing was run alongside background data traffic, generated via ActiveSync e -mail clients on the same test devices, to simulate a typical smartphone user environment where instant messages, emails or social media notifications might be generating data traffic while a voice call is underway.

These challenging parameters were set specifically to show the differences between the networks in as much detail as possible, and would simulate a customer who made very intensive use of their mobile phone while travelling.

This year, we consolidated the voice scoring for highways and smaller cities and towns. As we covered more ground along the test routes, the P3 vehicles could drive in different areas of the same large city at the same time, but would often be twenty minutes or so apart when moving between more remote locations.

Since all voice tests were conducted between the two cars, that made it impossible to separate elements like dropped calls if, for example, a call failed while one car wa s in a small town and the other still on a highway.

And waiting for the two vehicles to coincide in each smaller town before starting to test would have cost a great deal of valuable measurement time.

Data tests weren’t affected because the data test phones in the two vehicles were communicating directly with the internet rather than each other.

As with data, the most important aspect of a voice call is reliability; few things impact the customer experience more than a call that fails to connect, drops halfway through, or suffers such a falloff in quality that you decide to hang up and try again.

So as with data, we set exacting standards this year for voice test samples to qualify: they had to set up and complete successfully, and also to maintain a mini-

mum speech quality throughout.

We checked voice quality using the Perceptual Objective Listening Quality Analysis Wideband algorithm, an international measurement standard for nextgeneration networks that supports high-definition voice where available. It uses a standardised 5point quality scale known as the Objective Listening Quality – Mean Opinion Score, or MOSLQO. Again, the proportion of qualifying samples was the most heavily weighted part of voice testing.

For all qualifying samples, we then assessed further based on ‘differentiator’ metrics: average speech quality throughout the call – again using the MOS-LQO scale – and call setup times, defined as the time between initiating the call and the receiving party hearing the first ring.

CONSULTATION AND INDEPENDENCE Just as with last year’s benchmark, we spent months consulting with Optus, Vodafone and Telstra before testing began.

Nobody knows the networks better than the operators themselves, and we wanted to be as transparent as possible in designing the final test parameters and ensuring we reflected the latest in cutting-edge mobile technology.

It was also important to ensure that testing did not coincide with any planned network outages that might distort the results, and to keep lines of communication open with the operators even during testing, to make sure we were informed of any brief unplanned outages that might impact the test data.

That said, the benchmark is totally independent and impartial. The final say for the test design and score weighting was ours and ours alone. While we gave the operators an overview of the test areas and the overall timeframe, we kept the precise test schedule carefully secret. And of course, the operators have had absolutely no influence over the final results.

THE RAW RESULTS VOICE Telstra came out ahead on all metrics, but competition was fierce with metro voice performance a much closer race than last year. All three operators demonstrated very stable call performance; Telstra’s qualifying call ratio was superb at 98.5%, but Optus was close at 97.8% and Vodafone improved voice stability hugely on last year’s results to finish only fractionally behind at 97.5 percent.

Optus also boosted its voice quality impressively for this year’s benchmark, with a very solid 3.4 against Vodafone’s 3.5 and Telstra’s 3.7. (It’s worth noting that Optus has this year launched high-definition voice, which Telstra and Vodafone already previously had live in their networks.)

Telstra, however, overtook Optus this year for the fastest call setup times, at a quick 6.2 seconds vs Optus’ 6.4 seconds; Vodafone was further behind at 8 seconds, although that still marked a significant improvement on its performance in 2014.

Outside the main cities, qualifying call ratios are largely a function of network coverage; moving into an area with no signal will, obviously, cause a call to drop.

It’s not surprising, therefore, that Telstra – which has the network covering the largest area of the country – pulled further ahead of the competition on qualifying call ratios, at 97.2% against 92.7% for Optus and 91.7% for Vodafone. On the other hand, call setup times were fast across the board this year; Vodafone’s quick 6.1 second average was just fractionally behind Telstra’s at 6 seconds, with Optus close at 6.6 seconds.

And again, with all three operators now offering HD-voice, average speech quality was uniformly high; Vodafone and Telstra shared the laurels at 3.6, with Optus close behind at 3.4.

*Objec ve Listening Quality – Mean Opinion Score, a standardised score of telephony speech quality ranging from 1‐5 .

MOBILE DATA Since the emergence of the smartphone, the spectacular and ongoing explosion of demand for mobile data has been one of the biggest challenges for all operators both in Australia and worldwide. Mobile video is playing a

huge part in that, particularly in Australia with the launch of Netflix this year and competing services like Stan and Presto. Increasingly, we expect to be able to browse the internet, pick up our emails, check Facebook and watch YouTube clips on our

phones just as easily as we would on a desktop computer – even in the middle of a crowded city with thousands of other people doing the same thing. This all translates into massive demand on the mobile networks in major metro areas, even though they’re some of the most profitable markets for the operators. And so Vodafone, Telstra and Optus have all pumped huge investment into their metro infrastructure.

All the operators’ networks proved extremely reliable and stable in the metro areas, with session ratios close to perfect in almost all tests. Telstra was a particular standout, with qualified session ratios of over 99% in every category; Optus was very close behind, with at least 98% of all samples qualifying. Vodafone had similarly high qualifying ratios, a huge improvement on last year’s benchmark, and actually was equal with or a close second behind Telstra in some areas – only dipping slightly with a 93.7% qualifying ratio in Youtube HD tests.

Much of the investment made by operators in their networks is designed to achieve higher data speeds that, split between all the users on a network, make everyday tasks go just that bit smoother: things like sending and downloading music files, photos and emails.

So some of their individual strengths started to come out in up- and download testing. For smaller file downloads, for example, 90% of samples clocked better than 9.9Mbps on the Telstra network; Optus was close behind at 8.4Mbps, with 90% of Vodafone samples downloading at a respectable 5.5Mbps or more.

But Vodafone shone in some of the higher-end samples; 10% of small file downloads on its network came in quicker than 52.7Mbps, against 45Mbps for Telstra and 35Mbps on Optus.

Peak testing, meanwhile, really gave each network a chance to show off its pure horsepower as we pushed as much data through as possible in a ten-second win-

dow. Telstra sailed comfortably into first place on the download rankings, with the highest average downstream throughput at 46.4Mbps vs 38.3Mbps for Optus and 31.7Mbps for Vodafone.

And Telstra also hit some incredible high points, with 10% of peak download test samples coming in at faster than 95.5Mbps (vs 76.1Mbps for Optus and 65.2Mbps for Vodafone).

On the other hand, Vodafone showed its chops in peak metro upload testing, with an average throughput of 19.9Mbps, against 18.7Mbps for Telstra and 9.5Mbps for Optus. 10% of samples tested with Vodafone were faster than 40.4Mbps on the upload, against 31.7Mbps for Telstra and 22.5Mbps for Optus.

Telstra did better in terms of

consistency, though; 90% of samples on its network uploaded faster than 5.1Mbps, vs 2.99 Mbps for Vodafone and 1.5Mbps for Optus.

Beyond the major metropolitan centres, the scores began to separate out. Telstra was a clear leader in almost all categories, performing particularly well in YouTube and web browsing tests.

It demonstrated exceptional reliability with perfect qualifying session ratios in several categories, and very fast speeds with both average throughput and top data rates ahead of the competition in almost every field.

Optus came in a strong second, with good reliability and data speeds in particular hugely improved over its performance in smaller cities in the 2014 bench-

mark; its 24.1Mbps average download rate in peak testing came close to Telstra’s 27.3Mbps, and it actually demonstrated some of the highest speeds in test in peak upload despite coming in the middle of the pack for average upload speeds.

Vodafone, which has an LTE network more concentrated in major metro areas, also improved its data throughput speeds enormously in most categories but, as competitors also lifted their game, trailed Optus on the speed metrics. It was close behind Optus in terms of reliability, though, and notably did much better in terms of stable standarddefinition YouTube performance than it had in 2014, only dipping on HD YouTube qualifying sample rates.

Outside of urban areas on the connecting roads and highways, Optus performed very strongly.

In a marked turnaround from its success ratios 2014, it actually scored highest for qualifying sample ratios in several categories, demonstrating very good stability, and did well on speed with the quickest small file transfer session times.

Telstra was neck and neck on stability, though, right behind Optus on qualifying sample ratios in some categories and ahead in others; it also retained first place for average upload and download speeds in peak testing, with a commanding lead on peak upload rates in particular. Vodafone was a close third for stability, with the spread of qualifying sample ratios less than 7% be-

tween the three carriers on all tests apart from the challenging YouTube HD category. Its speed results on the highways were solid but showed less improvement

than those of its two rivals, perhaps reflecting the fact that Vodafone’s 4G investments have been concentrated more in urban areas of Australia.

THE FINAL VERDICT

The final master score table aggregates all of the different metrics in each category and applies the weighting developed by P3 communications; % indicators in subcategories show the percentage of maximum points obtained, to avoid rounding display issues.

Telstra, the winner of the inaugural benchmark last year, took the laurels

once more in this year’s benchmark and scored the best performance in almost all categories. With the most extensive LTE network, its consistently excellent performance for voice and data both in major metro areas and more regional locations kept it on top.

Optus came in close behind, though, and dramatically pushed up its data

performance score on the highways to score highest in the category.

Vodafone put in a strong third-place showing overall with huge improvements in terms of stability; it did particularly well in metropolitan testing, where it has concentrated its network investment, and where its high-end speeds were some of the fastest under test.

COMPARING 2015 WITH 2014: Vodafone’s massive 40% gain Mobile technology is evolving so quickly that users’ expectations change even from year to year; to reflect this, P3 is constantly evaluating network performance for operators all around the world and how it affects the basic requirements for mobile phone performance.

Each year, all of that input is used to adjust the test scoring to make sure it keeps pace with the current ‘state of the art’ – and provides continuity for the longer term.

In 2015, P3 has also updated its methodology and harmonised all of its international benchmarks on a new, more granular 1000point scale.

All of this makes it difficult to directly compare the master score table for 2015 with last year’s data.

However, one of the underlying reasons for the whole exercise is to show how networks are improving over time.

Therefore, to show clearly how far each operator has come in the last year, we’ve also run last year’s raw data through this year’s scoring model to provide a like-forlike comparison – and the results are impressive for all three operators.

Vodafone improved its comparable score by just under 40% on last year’s numbers, a colossal improve-

ment driven by big gains in every category except data on connecting roads. Vodafone’s turnaround was particularly pronounced in major metro areas, where its voice score alone almost doubled year-on-year with qualifying call ratios shooting up. The carrier also worked hard to iron out the network glitches that impacted some of its numbers last year.

Optus, similarly, drove its comparable score up by almost 27%, another huge upswing that again reflected better performance almost across the board – and a particularly outstanding boost to data speeds.

Notably, Optus was the only carrier to markedly improve data scores out on the highways, further from cities and towns.

While its rivals did a lot of work to close the gap, Telstra’s 7% score improvement was also impressive given how well it did in 2014.

The firm has committed significant engineering and financial resources to keeping hold of its network advantage, and this came through in comparably higher scores for almost every category.

All three operators can be pleased with the year-on-year improvements.

IN CONCLUSION TELSTRA has retained its top spot overall and scored consistently well across test types and different geographies. As the pioneer of 4G in the Australian market, which it launched in 2011, it has a very extensive network across the country and in-depth experience with the technology.

It has also wasted no time this year in deploying its new spectrum holdings, and pushing the speed envelope with the latest carrier aggregation technology; it scored searingly fast speeds in data tests across the board. And even with a much closer contest in voice this year, Telstra won out with the highest scores both in major metro areas and beyond, in small cities and on the highways.

As a result, Telstra has not only stayed ahead of its rivals but even managed to improve on its excellent performance in last year’s results – no mean feat. It only dropped off slightly in YouTube testing and web browsing on the highways.

OPTUS has been similarly quick to capitalise on its new spectrum and has been particularly aggressive in using the 700MHz band to rapidly push out its coverage, including in regional areas. The firm has also made use of carrier aggregation and, for the first time, its unique TD-LTE assets – used to bolster its network in specific areas – have played into its benchmark test results.

The impact of all this can be clearly seen. On a like-for-like basis, Optus improved substantially on its already solid performance last year, narrowing the gap between itself and Telstra, and in particular opened up the throttle on data speeds. It also scored an especially notable boost in performance in the more regional areas, on connecting roads and highways, to edge into the lead overall in those areas.

VODAFONE achieved by far the largest improvement of all the carriers, beating its 2014 score on a like-for-like basis by a huge margin. Having rolled out its own flavour of carrier aggregation this year and refarmed some 850MHz spectrum for 4G, it hit very high speeds in a number of categories – leading the field, for example, for peak test throughput on the uplink in metro areas. And while its focus on the metro markets was still reflected in lower scores in smaller towns and cities and on the highways, it still managed solid results there. The most notable improvement for Vodafone in 2015, though, was in the stability of both voice and data services. While lower success ratios hurt its 2014 scores in a number of categories, Vodafone achieved strong qualifying sample ratios in both voice and data this year, in many cases very close to its rivals and even pulling ahead of Optus in a couple of subcategories – a testament to much more reliable network performance.

While the operators’ respective network investments have really pulled through into clear improvements in this year’s results, they’re all pushing ahead with even more upgrades and enhancements—and have all committed to the capital expenditure they’ll need to stay at the forefront of mobile technology. So we can expect to be able to measure corresponding improvements in next year’s benchmark.

One of the biggest changes going on right now is Voice over

LTE; Telstra starting switching on the technology in its live network just after we finished testing this year, and Vodafone and Optus have also both been trialling it for some time with a view to commercial deployment. In allowing voice to be carried natively on 4G rather than switching back to 3G, VoLTE should mean much faster call setup times as well as fewer dropouts and a wider spread of high-definition speech quality. The P3 measurement systems are already set up to be able to measure VoLTE, and we look forward to seeing the results in the 2016 report.

We’ll also need to carefully select our measurement devices to ensure we can keep track of the latest commercial deployments of cutting-edge carrier aggregation.

All three carriers had dualcarrier aggregation running on their networks during this year’s testing, in addition to using new or refarmed spectrum – and data rates across the board came in much, much faster than last year.

With Telstra and Optus already having commercially launched Category 9 LTE, promising triplechannel carrier aggregation on compatible devices, and Vodafone also indicating it may roll out a similar technology, we can expect to see even better speed results in 2016.

There are even technologies such as Voice over Wi-Fi on the horizon; Optus already offers it through an app, and all the operators have discussed the potentially of offering it “natively” (i.e. having the functionality built into hardware).

It may be difficult to measure the impact and performance of Voice over Wi-Fi via drive testing, however, so we will need to explore whether we adjust and expand the scope of the benchmark to look at it.

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Australia’s network architects on their mobile challenges Australia’s three mobile networks are some of the most advanced in the world, and Telstra, Optus and Vodafone are working to stay at the cutting edge. Petroc Wilton spoke to the three executives most directly responsible for this state-of-the-art infrastructure – Telstra networks group managing director Mike Wright, Vodafone chief technology officer Benoit Hanssen and Optus acting managing director for networks Dennis Wong – about the roadmap for mobile technology in Australia, from the latest developments through to the 5G future.

THE NEED FOR SPEED All three Australian operators are constantly expanding their 4G mobile footprints. In particular, Vodafone is intent on pushing 4G further into its network, which already has around 9697% metropolitan 4G coverage; Telstra and Optus have extensive 4G networks across even more of the country, with Telstra claiming the largest, and both are also expanding.

But the really big drive is towards higher data transfer rates – not to put blisteringly fast theoretical top speeds into the hands of individual users, but to ensure that the growing number of people sharing the networks all have a consistently good experience.

“The old story... which we’ve been tied to for a number of years now, is that speed means performance and capacity. If all of these consumers want to consume more and more data every year, what they would like is for that to be a reliable experience: quicker response times, more robust for all the users in the cell,” says Telstra networks GMD Mike Wright. “It’s not about reaching those peak speeds... what we’re seeing now is more [the need for] consistency,” agrees Vodafone CTO Benoit Hanssen.

To get those higher speeds

and thus a more consistent experience, all the network operators have been trialling and deploying carrier aggregation: joining together channels in different radio frequency bands to drive up data throughput rates.

Telstra’s Wright compares it to bonding multiple lanes of a highway together, and notes that the number of channels combined is part of what classifies network technology as ‘Category 6’, ‘Category 9’ and so on – along with more advanced types of modulation technology to carry more bits at the same time.

“We’ve continued to champion that speed/performance curve... if you look at the world first we’ve done there on Category 6 [with dual carrier aggregation] quite some time ago at 300Mbps, it’s very well established. So much so that by the end of the year we expect to have 20 different device models and a million Cat 6-capable devices on the network. That drives network efficiency, it means the network can carry more users, and it means that... on the Telstra network they can continue to rely on throughput and performance,” says Wright.

“We’re looking a couple of years ahead; we will first launch Category 9 [with triple carrier ag-

gregation, and peak rates of some 450Mbps], we’ve got two Samsung devices already on the market... and the network’s been upgraded to Category 11, for 600Mbps peak network speeds [using triple-carrier aggregation].

We’ve been working with our partners, Ericsson, Qualcomm and Netgear on a [Cat 11] mobile hotspot which, by the time this magazine comes out, we’ll have been talking about!”

Optus has also been developing and deploying dual and now triple carrier aggregation. Indeed, it’s claimed a world first with its own type of triple aggregation because it combines channels in frequencies used for both TD-LTE and FD-LTE, two different types of 4G. “We have switched our 1xFDD and 2x TDD 3CA technology on in the Melbourne CBD and select suburbs of Newcastle, with the Sydney, Brisbane and Adelaide CBDs to go live in 2016,” says acting networks MD Dennis Wong.

“Earlier this year, we achieved download speeds of 480Mbps to a single user device on the Optus 'Gigasites’... among the world’s biggest and fastest live network sites, used by Optus to test the latest 4G technology developments. The 480Mbps download speed was accomplished by aggre-

gating four separate 4G channels or carriers – each 20MHz wide.”

Optus has also hit peak download speeds of 415Mbps in 40MHz of spectrum by combining carrier aggregation with MIMO: ‘multiple-input, multiple output’ technology that uses multiple transmit and receive antennas to boost bandwidth.

Vodafone, for its part, has deployed dual-carrier aggregation and CEO Inaki Berroeta has previously indicated that triple aggregation may also be on the cards.

“Carrier aggregation is about not just having peak speeds in the middle of the night, but so that even during the day when the networks are heavily loaded [with] lots of subscribers, you can still get high-definition streaming video through to your phone,” says Hanssen. “So that’s where a lot of our focus goes.”

VOICE OVER LTE Another key current development is voice over LTE. When it was first launched, 4G/LTE did not have native support for voice; as a result, 4G handsets switch over to the 3G network for voice calls, using a process known as circuit-switched fallback. But that switching process can result in longer call setup times and, sometimes, even dropouts; it also means that any data sent during the call is transmitted at the slower 3G speeds.

Voice over LTE is a technology that allows handsets to make voice calls while staying on the 4G network. Optus and Vodafone have been trialling VoLTE, and Telstra began deploying it commercially just a few weeks before this magazine went to press.

“We’ve been working on everything from our end-to-end transport networks, our core network, our radio network, all the different coding schemes to convert voice... we’re now going to carry voice purely on LTE, on the internet protocol layer,” says Telstra’s Wright. “We’ll progressively start enabling the network for new customers to be activated on

VoLTE... in the coming months.”

“It’s probably the biggest change to voice in forty years. I’ve spent all my career trying to manage circuit-switched voice calls, to get dropouts very low and get good quality voice; VoLTE is a huge technical transition, but an important one,” he adds. “Two customers that are VoLTE end-toend will get very fast call setup; that’ll be the biggest single thing that they’ll notice. But also, when they make a VoLTE call they’ll stay on the 4G layer instead of

“We’re now going to carry voice purely on LTE, on the internet protocol layer” Telstra’s Mike Wright going back to 3G; and what that means is that voice and data will both stay on the 4G layer. So if you’re doing a simultaneous activity, talking and, say, surfing the web, you’ll get the benefit.”

Vodafone’s Hanssen agrees that VoLTE will mean much quicker, smoother setup times; Vodafone has seen calls set up in as little as two seconds in its trials, and the CTO expects that to become almost instantaneous in the long run. But he also says VoLTE should mean better quality for more voice calls, and even better data transmission speeds overall. “We already have highdefinition voice on 3G today; I

think that’ll take another step, and you’ll see more of the calls being high-definition,” he says.

“And, because with VoLTE we’re taking a big chunk of traffic off the 3G network, it will allow us to redeploy some of that spectrum to 4G as well.”

Telstra’s Wright likewise says that VoLTE will provide a base for the expansion of HD Voice, but also casts it as a foundation for even broader developments in the future. “We were the first to bring HD-voice to the market a number of years ago, and about 70% of our devices in market already support HD voice; about 30% of all our calls today are HD voice. And as we introduce VoLTE, we’ll actually expand the reach and range of HD Voice beyond just mobile-to-mobile calling, to next-generation calling [across fixed and mobile platforms],” he says. “[VoLTE also] gives us the foundation for Voice over Wi-Fi calling, and we’ve got a strong view that video calling’s got a future and this capability will be a foundation... and potentially also be a foundation for things like rich communication suites.”

Voice over Wi-Fi is an area that Optus, too, is keenly investigating. “We recently launched Wi-Fi Talk – which was the first to market in Australia,” says Wong. “The Wi-Fi Talk app is a simple way for Optus customers to stay connected where they have access to a Wi-Fi connection. Already we are receiving terrific feedback from our customers.”

“On the horizon, there is native Voice over Wi-Fi which we expect to continue to evolve.”

LONGER TERM Beyond the short-term horizon, each operator is already planning ahead; looking at how to meet future requirements with the next set of network enhancements.

Telstra’s Wright identifies video as one of the key upcoming drivers of bandwidth demand. Thus,

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his firm has for some time been looking at various new ways of tackling mobile video, including LTE-Broadcast: a technology for delivering the same content to multiple users in a cell over the same bit of network capacity.

“We still believe that LTEBroadcast has got a role to play; the industry is gradually lining up on it, we’re trying to play a role on helping to accelerate that, so we think we’ll start to get some momentum,” says Wright. “We’ll [also] work on more efficient coding... we’re looking at ways that we can treat video, whether it’s the way we evolve our content delivery networks or whether we look at some micro-caching. We want to focus around good video in the coming years.”

In addition, Telstra is delving into time-critical mobile applications for emergency services and enterprises, exploring options like dynamic spectrum prioritisation to make sure the right agencies have access to capacity in an urgent situation. “And we’ll watch carefully how some of the Internet of Things standards evolve... we think there’ll be something in the 4G timeframe, before 5G, that will have a role to play,” adds Wright. “We’ll continue to pursue things like voice over Wi-Fi and video calling as well.”

Vodafone’s Hanssen, for his part, is anticipating more work on MIMO, with progressively larger arrays of more and more antennas.

“There are a couple of other trends that we’re monitoring very closely, and that will start to impact us if you look at the five-year horizon; the emergence of small cells or hotspots,” he adds.

“I don’t see a mass deployment of small cells in Australia, given the structure of the country and very large suburban metro areas; I see small cells coming, but in hotspot areas. We will see applications like a tighter integration with Wi-Fi, and a more seamless integration of mobile networks with mobile networks;

we’ve been indicating for a while that we are closely looking at what’s happening in that space, and I think that will happen in the next few years – maybe even next year, let’s see how quickly the technology develops.”

“And as we go to the next generation of radio... more and more of the technology is using commoditised hardware, [and] is being virtualised on that commercial, off-the-shelf hardware,” adds Hansen. “So you’ll see also things

“You’ll see also things like the core network, the transmission network and the radio network start to make use of cloud technologies” Vodafone’s Benoit Hanssen like the core network, the transmission network and the radio network start to make use of cloud technologies. It’s not immediate, but if you asked me about the next five years, it’s definitely something that will happen; it will give us network operators a lot more flexibility in deploying services and bringing services to market.”

Optus’ Wong, meanwhile, is looking to his unique set of TDLTE spectrum as a differentiator in the future. “Optus will always seek opportunities to trial, evaluate and deploy new technologies to improve the user experience and our overall network capability,” he says.

“We are also working on the second phase of development of Liquid Applications, which will focus on user experience, a more efficient delivery of content and

an Augmented Reality trial. The Augmented Reality trial aims to provide different live views for customers at a venue and an enriched entertainment experience.

We are working to deliver a real life second screen experience.”

FORWARD TO 5G But the global mobile community is already looking even further ahead. It’s only been a couple of years since 4G hit Australia, but there’s a growing international buzz around the next big mobile standard – 5G. In practice, though, is it going to be just another speed upgrade or something more?

“While 5G is still being standardised globally, we know the process is very different from the development of 4G,” says Optus’ Wong. “With 4G, it was a case of developing technology and then determining what services that technology could provide; with 5G, the focus is on what it needs to achieve and to then provide the technological means to fulfil those needs.”

“Right now 4G is all about video, video and video. What users can expect from 5G is a much more sensory experience. We see 5G being a ‘life companion’... 5G is about services that will require a high bandwidth, very low latency and about the next evolution of user experience such as realtime gaming and 4K video.”

Beyond the smartphone, Wong also sees 5G as a key to the Internet of Things – a world of billions of ubiquitously connected devices, with everything from fridges to cars to traffic lights interlinked and able to be monitored and controlled remotely.

“5G will not be just about faster smartphone downloads, but the Internet of Things and widespread connectivity,” he says. “By 2020 there may be anywhere up to 200 million devices in Australia that can connect to a network.

It’s about convergence, where everything is seamless due to extremely low latency... 4G has latency of around 50-30 millisec-

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onds but this figure will be closer to 5-10ms for 5G.” “This will be an important step towards achieving the real smart city and smart nation.”

Telstra’s Wright sees a similar path. “What is interesting I think about 5G is that... it’s probably going to have many more facets.

2G, 3G, 4G were more about a single facet of more speed and greater reliability; 5G will be more of a multi-service network and you can split it into things like, yes, more speed, [but also it will be] optimised for video delivery, no doubt,” he says. “The whole Internet of Things machine-to-machine thing is likely to be the area where it starts to look like multiple networks – optimised in one area, say, for high bandwidth. Or there may be a low-power, wide-area component of 5G which will have very long battery life, huge coverage depth into buildings, the ability to put in sensors that sit there for 10 years to run on one battery. Or conversely, it might support very low latency, very rapid data transfers for things like vehicle control or collision avoidance – or even haptic robots, operating a medical device over a video link for a remote patient.”

“So probably what’s going to characterise 5G is that ability to be multiple things for multiple users. It will also start to be the foundation for a more dynamic network, where we’ll use much more cloud technology and network functions virtualisation – so if part of a network suddenly needs to communicate to a huge number of smart meters, we’ll be able to put that bit of software that normally runs in the centre of the network near where they are, let them take use of it, and then shut that software down and use it for something else.”

Vodafone’s Hanssen, again, sees more than just a speed bump from 5G. “Of course [it will mean] speed and capacity, because consumers just want to use more and more and more and the applications are developing

that will need it,” he says. “But it’s not just that. With 5G, you’re going to also see a step down in latency; the speed at which you connect and the delay you get before the data can be downloaded.”

“And that will enable a whole range of things that today are possible on fixed-line networks, where latency is really low... but are not yet quite feasible on mobile networks. Applications like virtual reality... [and] driverless cars; if you look at the number of

“It’s important to be a wingman to our customers” Optus’ Dennis Wong

interactions you need to do when you drive a car, and how it operates with its environment, that’s another application that would really benefit from 5G at low latency, because you need instant reaction to things happening on the roads.”

Like his counterparts, Hanssen sees 5G as critical to enabling mass connectivity for the Internet of Things. “3G had a certain limit on the number of users it could have per cell, it was increased with 4G, but with the emergence of the Internet of Things and everything becoming connected, the number of devices that you’re going to be talking about by the time 5G comes

along needs a step up in terms of connectivity,” he says. “It’s not a complete revolution... but it’ll be more than just a speed step up.”

5G TIMEFRAMES All this begs the question, of course, of when 5G will hit Australia – and how quickly the transition from 4G might take place.

“There are a number of 5G development phases,” explains Optus’ Wong. “From now through to 2018 there is an intensive phase of standardisation.

From 2018-20 there are likely to be limited trials in a handful of markets. It is expected that commercial deployment will start in Australia from 2020 onwards, depending on the maturity of the entire eco-system and business viability.”

“It really will come down to how well... we define what the standard for 5G means; we saw with 4G that there was a bit of variation,” says Telstra’s Wright.

“The common industry acceptance is that the standards themselves won’t be locked down, and the technology not developed, till around 2020... there’s a lot of competition in the world, a lot of people will all be desperate to be seen to be involved with the roadmap, to be seen at the leading edge. But arguably, 2020 is about the day it should be official.”

“I don’t think consumers will wake up one day [suddenly with 5G devices!] But what you will see, particularly in this world of software, is you’ll very quickly see elements of 5G where they matter. And because it’s going to mean so many different things... different parts of the world may adopt elements that are more focused on the specific use cases or challenges that they’re working on at the time. But I do think you’ll think a fairly rapid introduction of some of it – as soon as the standard is locked, the silicon’s ready and the software’s ready.”

Vodafone’s Hanssen sees a number of factors in play. “One

TM

is when the demand will emerge, and I do think that will indeed be in the early 2020s,” he says. “ We’re [also] an industry that’s heavily dependent on standards; even though Telstra and Optus are competitors, our networks do need to coexist and operate together. At the same time, the phones... need to work. The development of the 5G standard is actually kicking off right now; it always takes some time to really land on an agreed standard.

Then you’ll see network products development take off, and that always takes a couple of years.

And phone development typically joins a little bit later after that, because they depend on networks to test their gear. If you see how that went in 2G, 3G and 4G, logically you wouldn’t see commercial networks until 2020, 2021.”

“There are some networks that are always a little bit ahead in the world [like] NTT DoCoMo in Japan... and who are also prepared to do what we call pre-standards releases. [But] Australia doesn’t have a history of pre-standards launches; what you’ll see in Australia is that we’ll be quite early, I think, in the standardised 5G.” “I think the transition will be very similar to what we’ve seen between 3G and 4G. I do think consumers will notice,” continues Hanssen. “[For example,] in 3G you didn’t see much streaming video, and now streaming video is everywhere – of course, that didn’t happen on the day that we launched, but as the industry follows technical development, [and now] you’ve got startups like Netflix, Stan and Facebook integrating a lot of video.”

“It [will be] a significant step change.... developers, product and media companies will bring something to market and then people will say ‘hey, that wasn’t possible on 4G’! But there’s still a lot of mileage in 4G.” 5G LEADERSHIP Of course, given that Australia is such an advanced mobile market,

local operators may well help to drive 5G development themselves.

“We’re one of the leading countries.... Australians tend to adopt new technology fairly early, like smartphones, and seem to be willing to pay for new high-tech gadgets,” notes Vodafone’s Hanssen. “The other thing about Australia is that it’s a low-density population, and a low density network... which also, from a network management point of view, drives the need to put more capacity on fewer sites.”

“I think the most important role we play is on behalf of Australia,” says Telstra’s Wright. “In all of these technologies, we don’t profess to try and control everything – but we try and remind the rest of the world a little bit about what’s unique about Australia, our density of population, our huge distances. Where we want to contribute is about a number of things like what spectrum is ideal; and certainly in some areas like the Internet of Things.”

“We see Australia playing a key role in the development of 5G, given our experience providing coverage across the geographic expanse of the country and the urban areas along the eastern seaboard,” says Optus’ Wong. “5G will provide great benefits across a large area in the fields of agriculture and transport while high bandwidth comes into play in our eastern coastal cities. “ “Spectrum allocation and ownership in Australia will also be decisive; we are hoping to be able to use those spectrum assets to develop technologies to compete with and differentiate from other markets. Optus’ TDD spectrum assets... put us on the front foot in terms of 5G development utilising those technologies.”

Wong also notes that Optus’ Singaporean parent company Singtel is itself a member of the Next Generation Mobile Network Alliance and the GSMA group, both of which help to define technology standards.

COMMS CHALLENGE In practical terms, a key challenge for Australia’s mobile network thought leaders comes in translating many of these highly technical advances into tangible impacts for consumers – particularly when many of the upgrades, as well as the essential spectrum resource, can cost their respective companies millions or billions of dollars.

“The focus of all of Optus’ communications is about customer experience,” says Wong. “We aim to illustrate the user experience and the ease of use of products for customers. For example, looking to native voice over WiFi, we will talk about its ease of use rather than how it works in a technical sense. Similarly when we launch an app we talk about the customer experience and practical benefits, not just the technical view. It’s important to take customer centric approach to communications and be a ‘wingman’ to our customers.”

“Rather than say we’ve got the biggest or fastest network... we’re trying to show consumers what they can do,” says Vodafone’s Hanssen. “That’s why we’re... one of the leaders [in] bundling in streaming services like Spotify, Stan [and] other offerings, [to show] what you can do with the network; we’re confident that our network is of such quality that it can seamlessly stream those kinds of services.”

Telstra’s Wright tells a similar story. “A lot of what we do is about translating technology into things that mean something for consumers. Everything that drives us in the engineering team, for the history of Telstra, has been about dealing with all of Australia; the very heart of what we do is what it means for customers in a network performance world. Will it work for more people in more places with fewer dropouts; can we drive a huge footprint, can we drive innovation that stretches the laws of physics so that customers can get coverage at extreme distances?”

In search of higher frequencies The rapid rise of 5G into a major R&D area for the mobile industry has highlighted the need for more spectrum to accommodate the next generation wireless platform. When policymakers from around the world gather at next month’s World Radiocommunications Conference in Geneva, 5G spectrum is expected to be discussed for the first time. But with operators setting ambitious timelines to launch commercial services as early as 2020, spectrum policy managers will be hard press to meet the deadline - especially when they don’t even have a technical specification to work with, and no official decision can be made before the next WRC meeting in 2019. Tony Chan reports.

This November, representatives from the world’s governments will converge on Geneva for the World Radiocommunications Conference 2015: the latest in a series of such events organised by the International Telecommunications Union, a specialised agency of the United Nations, to review international radio spectrum and satellite arrangements.

They will discuss the future of global spectrum policy, and determine whether or not to allocate more frequency bands for the mobile industry.

One thing they won’t be talking so much about, however, is 5G – because when the agenda for this year’s event was laid out back in 2012, no one was remotely thinking about 5G, never mind looking to allocate spectrum for it. This year, there are two items for discussion on the agenda that concern the mobile industry.

One is the allocation of about 100MHz of spectrum (694MHz790MHz) for mobile communications in Europe. Another is the possibly of assigning more spectrum frequencies for the mobile

industry below the 6GHz band.

But while identifying new spectrum for mobile broadband is a priority for the industry as it faces increasingly overloaded network and surging traffic, there is some urgency when it comes to the identification of spectrum – particularly new spectrum above the 6GHz band – for future 5G networks.

The fact is Japan, the market that is keenest on 5G, is working on a hard deadline. Japanese operators want to have at least some form of 5G system deployed in time for the Tokyo Summer Olympics in 2020.

There is the possibility of using existing cellular spectrum for future 5G services, but that would not deliver the same outcomes as a ‘real’ 5G system, envisaged to yield blistering speeds magnitudes above LTE today.

But as NTT DOCOMO VP and MD of the operator’s 5G laboratory Takehiro Nakamura points out, it’s a chicken-and-egg situation. In order for policy makers to begin the process of identifying frequency bands for

5G, the industry needs to dictate what kind of spectrum is required with some kind of technical proposal – which is not ready, and probably won’t be until Release 14 of the 3GPP specifications due in a couple of years.

However, with available spectrum to discuss, there is no basis to include higher bands for Rel14 or even Rel-15. “So how do we justify the start of technical discussions in Release 14 and 15?” asks Nakamura Ultra high speed links There is some respite, however.

While it is still too early to put a finger on the specific frequency band required for 5G, there is overwhelming consensus that at least some 5G systems – those that will support ultra-high bandwidth applications – will require spectrum above 6GHz. The reason is that such 5G systems will need to deliver much higher data rates that are only possible with a large block of contiguous spectrum, which is no longer available below 6GHz due to existing applications.

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According to a whitepaper on 5G spectrum requirements by industry body 4G Americas, separate overarching types of usage scenario have been identified for 5G. Applications such as ultra HD video, virtual reality, augmented reality, tactile internet, and cloud gaming will require “ultra-high speed radio links,” possible only with a contiguous spectrum block of some 500MHz. Less data heavy applications such as industrial automation, ehealth, and self-driving cars, will only require what the organisation calls “high speed radio links” – though they will still need a 100MHz block of contiguous frequencies.

“To provide an example for factors affecting the amount of spectrum, for instance, ultra-high speed connections in the range of multi-gigabit per second could potentially be achieved through using ultra-wide carrier bandwidths in the order of up to several hundred MHz or more,” says 4G Americas. “An example could

be fast downloads of 4k/8k video content, which using wide channels and through multi-gigabit speeds, would take seconds.”

Let’s talk Fortunately for the mobile industry, many governments agree.

While 5G spectrum won’t be formally discussed at WRC-15, the topic is expected to be brought up as an agenda item for the next WRC event in 2019.

“Various administrations have started investigation and consideration of potential new bands for 5G,” notes 4G Americas.

“Given the need for more bandwidth, these investigations generally have been directed towards opportunities in the 6GHz to 100GHz frequency range.”

According to the US industry body, Australia, China, Japan, South Korea, Finland, Sweden, UK and US have all voiced support to include discussions on spectrum above the 6GHz band for 5G for WRC-19.

Several countries, including

Australia, are expected to submit detailed proposals with highlighted frequency blocks for 5G spectrum above 6GHz. Australia’s proposed spectrum blocks for 5G above the 6GHz band range from a relatively modest block of 600MHz between the 10GHz and 10.6GHz bands, to a massive 5GHz block between the 81GHz and 86GHz bands.

Northern European countries Finland and Sweden are proposing the lowest bands, starting from 8.5GHz and 5.925GHz respectively, while the US has so far contained its proposal to 5 blocks of frequencies located between 27.5GHz and 71GHz. Others, including China, Japan, and South Korea, are for the moment happy to just support a future agenda item for WRC-19 to discuss the topic.

Incumbent users Now that governments have expressed support to discuss centimetre wave (6GHz-30GHz) and millimetre wave (above 30GHz)

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bands for 5G at WRC-19, is the work done? Far from it, warns Keysight Technologies lead technologist, strategic business development Moray Rummey According to Rummey, the mobile industry will come up against incumbent users from the military, satellite and broadcast sectors, which are already using mmWave spectrum. These users will be keen to hold onto their existing allocations.

“It is expected that the negotiations for mmWave spectrum at WRC-19 will be hard fought – nothing is guaranteed!” warns Rumney in his presentation Finding room for 5G. “There is already a joint task group within ITU-R of existing license holders from other industries (satellite, land mobile, maritime, fixed wireless, broadcast and science) vetting the case being made by Working Project 5D to have spectrum reallocated to mobile communications.”

In Australia, the proposed 5G spectrum above the 6GHz band is currently allocated to a range of applications ranging from amateur fixed mobile radiolocation to fixed mobile broadcasting and earth exploration satellites.

Harmonisation challenge It’s probably too early for these incumbent users to protest, since the current scheme is no more than a proposal and any decision would not be due until 2019. But even if Australian users don’t protest, there is the issue of global harmonisation.

The incumbent users in Australia might not be the incumbent users in another market, so even if one market manages to get their scheme approved, it doesn’t mean incumbent users in another market will feel the same.

And there is every reason to worry. Rumney points out that there are now 43 frequency bands defined by the 3GPP for LTE. This fragmentation in LTE frequencies has resulted in the development of carrier aggregation, which further adds to the

complexity because of all the possible combinations.

According to Rumney, there are 156 CA combinations, including 60 alone for 3-carrier aggregation for the downlink.

“Every combination has the potential to require a new user equipment design to handle the filtering and power amplifier requirements. This drives up cost and complexity,” he adds. “We can’t afford to create a similar fragmentation at mmWave.”

points to channels 2 and 3 of 60GHz ISM band between 59.4GHz and 61.56GHz, and between 61.56GHz and 63.72GHz, as ripe candidates because they are “available almost worldwide.”

These channels, each offering a whopping 2.16GHz block of frequencies, represent ISM on “steroids” if they can be leverage using LAA, he adds. “This would give IMT-2020 a credible landing place leveraging existing 60GHz low-cost technology.”

Tight schedule Lastly, there is the time pressure for securing 5G spectrum.

With Japan and to some extent South Korea setting their sights on a 2020 commercial launch, the industry has a single event to reach global consensus.

No doubt the industry and government bodies will collaborate in the lead up to WRC-19 and lay some foundations, but the schedule for defining the technology and coming up with the supporting spectrum is extremely tight given historical timelines.

As Rumney points out, it took the ITU standardisation unit 12 years to come up with a definition for LTE-Advanced, and that was leveraging highly on LTE. For 5G, or what ITU calls IMT2020, the time budget is 8 years with much higher scope and difficulty.

“There is no pre-existing standard upon which to leverage IMT 2020… spectrum allocations for IMT 2020 won’t be negotiated until WRC-19,” he said.

“These factors make significant mmWave deployment in 2020 unlikely.”

If all else fails, Rumney proposes a Plan B using the same methodology, Licensed Assisted Access, as LTE-U – but using unlicensed spectrum in the mmWave bands.

“The initial LAA focus in on the 5GHz band,” he says. “If LAA works at 5GHz then the next logical step is to deploy cellular technology in the industrial, scientific and medical band at 60GHz.” Specifically, Rumney

Chicken and egg All up, 5G spectrum-related issues, particular those exploring new frequencies above 6GHz, are at least set to be officially recognised as a topic of discussion at the upcoming WRC-15 event.

And the topic is almost guaranteed a place on the agenda for the next WRC event in 2019.

But there are obvious challenges remaining. Identifying specific frequency blocks and harmonising them globally is one major hurdle for government policymakers. Appeasing incumbent spectrum holders to relent on their holdings will be another.

Then there is the chicken and egg situation. In order to guide policymakers in their allocation of spectrum for 5G, the industry must first come up with technical specifications for 5G, a task made the more daunting by the fact networks on higher frequency bands – above 6GHz – will likely require a new radio interface.

And while the industry is working on new air interfaces, there has yet to be any coordinated efforts to define one.

All the industry knows for sure right now is that 5G will need faster data rates, which in turn needs larger blocks of contiguous spectrum, which in turn is only available in the higher frequencies.

That’s not much to go on for policymakers who, if they want to meet the schedule of operators like NTT DOCOMO, will only have a single chance at WRC-19 to come up with answers.

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Mobile futures around the globe As LTE and smartphones become reality for users around the globe, Tony Chan profiles the leading mobile markets today, and where they might lead us in the foreseeable future.

SOUTH KOREA: THRIVING LTE UTOPIA South Korea is arguably the most advanced mobile market in the world, with three highly competitive mobile operators – SK Telecom, KT, and LG Uplus – vying for subscribers with advanced 4G offerings. The result is a highly dynamic market that has seen many ‘world first’ launches, partly helped in the past few years by the dominance of Samsung in the mobile handset space, which facilitated the commercial launch of advanced features such as carrier aggregation and voice-overLTE with supporting smartphones.

The need for 3CA While the first 4G networks appeared in Northern Europe, South Korea quickly asserted itself in the market by taking the lead when it came to the adoption of advanced features.

All three operators are well ad-

vanced in their LTE implementations, with each having upgraded their networks with LTEAdvanced technologies – first with basic carrier aggregation (2 carriers), and subsequently through 3-carrier aggregation, which merges three LTE channels to boost speeds to 300Mbps and beyond.

Ironically, while the Korean operators were the first to implement 3CA, they only managed to stay on par with global LTE-A speeds.

That’s because all three operators only had access to a total of 40MHz of paired spectrum, but across 3 frequency bands.

SKT’s network, for example, combines a 2x20MHz carrier on the 1800MHz spectrum band with two 2x10MHz carriers on the 800MHz and 2100MHz bands respectively, to achieve speeds of 300Mbps on the downlink. Likewise, the networks of KT and LG Uplus each had a single block of 2x20MHz spectrum, and two 2x10MHz blocks. The spectrum assets allow each operator to reach a maximum speed of 300Mbps.

Other markets such as Hong Kong and Singapore were also able to offer top speeds of 300Mbps, but by aggregating two 2x20MHz carriers (2x40MHz total) to reach the same perfor-

mance. In Telstra’s recent trial of 3CA in Australia, the operator combined three 2x20MHz carriers (2x60MHz total) to achieve speeds of 450Mbps.

Fast enough Despite the spectrum limitations, the performance of the Korean networks was clearly ahead of the rest of the world even as recently as the first quarter of this year.

That was when a formal test of one of the networks – LG Uplus – prompted Signals Research Group CEO Mike Thelander to conclude: “It would take less time to fly to South Korea to download 25 movies from iTunes via the LG Uplus network than it would take to download 25 movies from iTunes while sitting at our desk at SRG headquarters (in Oakland, California) and using a fixed connection augmented by Wi-Fi.” During his two-day test of LG Uplus’ network in Seoul, including on the subway, Thelander measured a peak data rate of 296.5Mbps, with the download speed performing over 200Mbps for over 30% of the time.

Even faster with Wi-Fi Perhaps the most impressive breakthrough so far is a worldfirst service launched commercial-

ly by KT: Giga-LTE. This combines 3CA LTE-A with wideband Wi-Fi developed by Samsung – called Giga – to deliver top download speeds of up to 1.17Gbps.

Not only does Giga-LTE support LTE-A at 300Mbps, it implements a version of Wi-Fi on the 5GHz frequency band that makes use of a 160MHz block of spectrum, as well as features like 8x multiple in, multiple out antenna systems, to deliver a whopping 867Mbps of throughput.

KT’s rivals, SKT and LG Uplus, have indicated they also have the Giga technology, but have yet to launch services commercially.

Both operators have demonstrated slower version of the LTE-WiFi combination, typically by combining 2 LTE carriers with Giga to achieve speeds of up to 600Mbps.

One explanation for KT’s head start is its status as the incumbent fixed line operator with a large Wi-Fi installed network, which it can upgrade easily with Giga. As evidence of this, KT is also offering a Wi-Fi only version of the service, dubbed ‘Olleh Giga Wi-Fi Home,’ which offers unlimited data downloads at the 867Mbps speed.

VoLTE South Korea is also the undisputed leader for voice-over-LTE, with all three operators offering VoLTE to their subscribers as early as 2013. Most recently, the country became the first country to achieve VoLTE interconnection between all three operators, delivering seamless inter-network support for features such as high definition voice calls and 4G video calls.

Samsung and LG The contribution from Samsung Electronics, and to some extent LG Electronics, cannot be overstated when describing the success of the South Korea market.

Every breakthrough made by South Korea’s operators could only be realised in practice because the handset vendors had

developed handsets to support those features. In every instance – carrier aggregation, VoLTE, 3CA – commercial services could be launched only because Samsung and LG had handsets that worked with the respective network advancements.

By contrast, while for example operators in other countries like Telstra, Hong Kong’s CSL, and Singtel had upgraded their network with carrier aggregation to deliver 300Mbps as early as 2014, they lacked the handsets to commercially launch services until recently.

Future forward South Korea’s mobile momentum looks unlikely to slow down any time soon. By the first half of 2016, the government is expected to announce the availability of more spectrum – on the 700MHz, 2100MHz, and 2600MHz bands – which will pave the way for higher forms of carrier aggregation (4x/5x) by the operators to further boost speeds.

At the same time, 5G and many of its use cases are becoming strategic directions for Korean operators. SK Telecom has announced its intention to build a dedicated nationwide network to support Internet of Things applications. The IoT network will use a technology called network functions virtualisation, which has the ability to separate out resources for different applications – something that SKT is working with Ericsson on.

In fact, all of South Korea’s mobile operators have entered into research agreements with one or more vendors to work on one or multiple areas of 5G. While the rest of the world is still debating issues such as LTE on unlicensed spectrum, South Korean operators are already demonstrating 256QAM modulation to boost downlink speeds, quantum cryptography systems, and millimetre wave systems that can deliver up to 7.55Gbps of throughput by adding 3D beamforming abilities to antennas.

JAPAN: THE FALLEN LEADER RETURNS Japan’s mobile industry is no longer the envy of the world as it once was, when NTT DOCOMO launched the world’s first mobile internet success story with its data-enabled i-mode service. At the time, Japanese users were able to access a kaleidoscope of information and entertainment services from their mobile phones, while the rest of their world was barely getting going with SMS and struggling with the now forgotten WAP technology.

Today DOCOMO, once the driving force behind 3G and a major innovator in handset design and service platforms, no longer dictates technology trends.

And while all three Japanese operators, including KDDI and Softbank, are considered early adopters of the latest LTEAdvanced platforms, network speeds top out at 225Mbps – a full generation behind South Korea, and even Singapore and Hong Kong.

But that doesn’t mean Japan is becoming a stagnant market; if anything, the opposite is true.

While the local industry was, as one analyst at Tokyo-based consultancy Eurotechnology puts it, “blindsided by the iPhone” because it was so focused on its own technology platforms, Japanese operators have definitely caught up with the rest of the world and are now poised to take the lead once more.

Garapagosu-ka Despite its early triumph in mobile internet, Japan’s mobile industry, and specifically NTT DOCOMO and its ecosystem of handset makers and software developers, failed to export that success overseas. This despite spend-

ing more than US$10 billion on investments in overseas operators: AT&T Wireless, KPN Mobile and Hutchison Whampoa.

This failure, dubbed Garapagosu-ku or Galapagos syndrome – in reference to Charles Darwin’s On the Origin of Species – by Japanese scholars, was blamed on the fact Japanese developers focused solely on driving technology features locally, ignoring global trends and standards. Their solutions, and phones – termed garakei (a combination of ‘Galapagos’ and the Japanese word for mobile phone, keitai) – were deemed too complex to survive abroad. So when the rest of the world evolved to smartphones, the Japanese mobile industry found itself isolated with a complex, legacy ecosystem that needed a major refresh.

Since the launch of the iPhone and Android smartphones, Japan has been busy transitioning its mobile ecosystem to catch up with the rest of the world. And while Samsung and Apple now dominate the handset market, and US firms like Google and Facebook lead in online services, the transition of Japan’s mobile ecosystem to global platforms seems complete.

Today, all three Japanese operators have embraced LTE and LTE-Advanced networking technologies, and iOS and Android have become the norm for handsets.

Dual-mode LTE Japan’s 4G progress can be said to lag behind South Korea in speed and sophistication for the moment, but it has one distinct advantage over nearly all other markets: the development of networks using TDD spectrum.

While most of the rest of the world – with a few exceptions like China – has focused on implementing LTE on FDD spectrum, Japan has maintained a robust, albeit often marginal, TDD infrastructure. Either through acquisition or legacy operations, both KDDI and Softbank operate

extensive TDD networks, while NTT DOCOMO is in the process of acquiring 40MHz of TDD spectrum (3.5GHz band), which it intends to merge with its standard LTE service.

According to Softbank unit Wireless City Planning senior director for technology planning division Hidebumi Kitahara, the operator is now looking to supplement its LTE network with additional TD-LTE capacity, predicting the TDD portion of the network will carry as much as 50% of the network traffic by 2018.

“Softbank has achieved almost 100% coverage nationwide with LTE. The next stage is to build more capacity to support demand,” Kitahara said at an industry conference recently. “We see TD-LTE as the solution for capacity, on the 2.5GHz and 3.5GHz bands.”

According to Kitahara, the high user density in Japan means that dual-mode LTE is a necessity. In one 60km2 zone in Tokyo, the network must serve a daily influx of 10 million commuters.

“The number of sites are saturated, not because we are not investing anymore into the network, but because there is no more space. Every rooftop is occupied,” he said.

In fact, all three operators have highlighted the need for du-

al-mode LTE carrier aggregation as a key future step. With the possible exception of China, which is also looking at the technology, Japan looks set to take the lead in dual-mode LTE. That would pave the way for a major speed boost, and possibly a way to leapfrog past its neighbour South Korea.

Fifth generation Japan may have lost its lead in 4G, but it clearly has no intention of staying that way for 5G. Led by NTT DOCOMO, Japan is one of the most aggressive markets in the development and exploration of 5G technologies.

With a hard deadline of the 2020 Tokyo Olympic games, DOCOMO has launched one the most extensive research programmes in the world with no less than 13 major mobile equipment and technology vendor partners.

The vendors – Alcatel-Lucent, Ericsson, Fujitsu, Huawei, Mitsubishi Electric, NEC, Nokia, Samsung, Intel, Keysight Technologies, Rohde & Schwarz, Panasonic and Qualcomm – have undergone work with NTT DOCOMO’s own researchers on a number of potential 5G features and technologies, including chipsets, radio interfaces, antenna arrays, software controllers, millimetre wave systems, and others.

The results of the work: a comprehensive exploration of potential candidate and deployment scenarios for 5G, ranging from waveforms in the low frequency bands for machine-to-machine communications, to ‘superwideband single carrier’ systems operating in the 70GHz band.

In a recent video of a simulated 5G system covering a stadium of 65,000 people, DOCOMO showed a system with a site capacity of 5Tbps per sector using small cells, massive MIMO antenna arrays, beamforming, and bigger spectrum blocks.

At the same time, NTT DOCOMO is also working in parallel with vendors on the core architecture for 5G. Most recently, the operator successfully demonstrated with Ericsson a proof of concept of the application of NFV in a multi-vendor environment.

While other operators – including all its Japanese and South Korean counterparts – have signed 5G R&D pacts with vendors and international research institutes, NTT DOCOMO is clearly one of the most committed.

US: THE LAND OF THE FREE US operators are now considered leaders in the 4G world. All four major operators, AT&T Wireless, Verizon, Sprint and T-Mobile, have rolled out nationwide LTE networks and are rapidly upgrading their infrastructure to LTEAdvanced to take advantage of carrier aggregation.

The US government has announced that 98% of the population has access to 4G LTE. The country has emerged as the second largest LTE market in the world, only recently eclipsed by

China’s LTE surge, with over 150 million LTE users across the four main networks at the end of 2014. At the same time, various estimates put smartphones well above 70% of the total mobile user base of some 320 million.

Being the home of online giants such as Facebook, Youtube, Google, Pandora and Apple, mobile traffic in the US has accelerated. According to 4G Americas, the industry organisation representing the mobile sector, monthly traffic on US mobile networks has skyrocketed 2,268% since 2009 – surging from 78MB per month to a whopping 1.8GB per month by 2014.

That level of traffic growth has put increased pressure on all the mobile operators to bulk up their network capacity. This year, US operators collectively spent a record US$44.9 billion on AWS spectrum across the country, close to five times the reserve price set by the Federal Communications Commission auction.

But that will not be enough to meet future demand, says 4G Americas. It argues that the US government should bring more licensed spectrum to market for mobile networks. But the mobile operators themselves, backed by technology vendors such as Qualcomm, Ericsson, and others, are not holding their breath.

Which brings up the hottest topic in the US mobile industry today: the possible implementation of LTE on unlicensed spectrum currently used by Wi-Fi. LTE-U The commercialisation of LTE-U, or LTE-unlicensed, has emerged as the most contentious topic for the mobile industry in the US in recently months.

On one side of the debate the technology’s vendor backers, supported by T-Mobile and Verizon, are pushing ahead with plans to roll out LTE-U – which they argue is merely introducing another technology on public unlicensed spectrum designated for common services.

They also put forth technical arguments that LTE’s sophistication allows the spectrum to be used more efficiently, leading to better mobile experiences for consumers.

On the other side of the argument is the Wi-Fi camp, which claims that LTE in its current form contains a ‘rude’ protocol that can hog the spectrum and adversely impact Wi-Fi users on the same bands.

Qualcomm, one of the main backers of LTE-U, counters that adequate measures have been taken to ensure that LTE-U can coexist with Wi-Fi without interference. The specific technology is dubbed ‘listen before talk’, which has been incorporated into the LTE-U technical specification and ensures that LTE-U networks makes sure that the airwaves are free before sending data – similar to how Wi-Fi behaves.

The Wi-Fi camp however remains unconvinced, calling for more tests and even certification of LTE-U devices.

The situation has escalated to the point the FCC’s technology and engineering department has decided to step in to put questions to the LTE-U camp. Qualcomm SVP of government affairs Dean Brenner, though, has said that the vendor is ready to answer in detail.

“At Qualcomm, whenever we invent a technology, one of the things that we do, right from the beginning is, a tremendous amount of technical work to make sure the technology works very, very well,” he says. “In the case of LTE-U… knowing that LTE-U is going to be featuring some of the same spectrum that is used for Wi-Fi, from the very beginning, we designed LTE-U to be sure that it will coexisting very, very well with Wi-Fi, and that it won’t have adverse impact to WiFi, that it will share the unlicensed spectrum very fairly with Wi-Fi. And we’ve done that, and have tested LTE-U extensively; we’ve done our homework.”

The debate is ongoing, but

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LTE-U will likely arrive in the US sooner rather than later. Whether or not it brings any relief to mobile operators, which also use Wi-Fi to offload data traffic, remains to be seen.

Uncarrier carrier Another catalyst in the US mobile market is competition, with a recent standout being T-Mobile’s willingness to forego established practices with new commercial models.

T-Mobile’s ‘uncarrier’ campaign, which eliminated monthly contracts, handset subsidies and even data caps, has created a new dynamic in the market – which previously operated only on operator-specific locked-in handsets, subsidies, and extended multiyear contracts.

The success of ‘uncarrier’ is evident. T-Mobile is now the fastest growing operator in the US and has matched Sprint’s market share for third place, from a distant fourth before the ‘uncarrier’ launch.

And while T-Mobile’s move has yet to impact the market share of the two market leaders AT&T and Verizon, it is nevertheless making its presence felt, prompting Verizon to announce recently that it too will offer nocontract subscriptions with simplified monthly charges.

In a new effort, T-Mobile has launched a plan that lets users rent their smartphone by the month over the duration of an 18-month contract. The kicker is users on the ‘on-demand’ plan can change their smartphones up to 3 times a year at no extra charge.

The willingness of T-Mobile to throw out the rulebook, and its subsequent success, has resonated with the market. Not only with Verizon, but also Sprint, which arguably has suffered the most as a result of T-Mobile’s gain.

Sprint has since stepped up to the plate with a competitive offer of its own, promising to literally cut users’ monthly mobile bills in half if they abandon their contracts with AT&T or Verizon.

At this point, the market advantage still rests squarely with AT&T and Verizon, which have the most spectrum and the most extensive coverage nationwide, but that could change with new technologies like LTE-U. Challengers Competition in the US market is not limited to the conventional mobile operators. Over the past year, a number of startups have emerged that could one day challenge the incumbents.

The two most visible are Google’s Project Fi, and a Los Angeles start up called FreedomPop. Both bring to the market new business models, valueadds and benefits to end-users that, on paper at least, offer compelling alternatives to regular cellular subscriptions.

Project Fi is an ‘experimental’ mobile virtual network operator service that uses the cellular network of T-Mobile and Sprint as well as Google’s own nationwide Wi-Fi hotspot network. Google charges users a flat monthly subscription fee of US$20, plus a US$30 charge for 3GB of data.

The sweetener is users get money back on any data they don’t use up, so someone who uses only 2GB of data in a given month gets US$10 credit for next month. You also get unlimited domestic talk and text, unlimited international text, 20 cent per minute flat rate to call over 120 countries, and the ability to use the same data bucket when roaming – although at 3G (256kbps) speeds.

Few performance or subscriber metrics are available for Project Fi, and a number of analysts think it is simply a way for Google to ensure mobile operators keep prices low. Similar motivations have been suggested for Google Fibre.

Then there is the commercial venture FreedomPop, an MVNO using the Sprint network which offers free mobile data to users signing up to its service. The company promises users a given amount of free mobile data per

month, plus a limited number of voice minutes and text when they sign up. Its business model involves the sale of value added services such as unlimited calls and texts, extra data, faster connection speeds and phone insurance.

FreedomPop also sells devices, usually refurbished smartphones and tablets.

According to the company, it is approaching the 1 million subscriber mark. CEO and cofounder Stephen Stokols says that, in any given month, half of FreedomPop’s customers pay for some services with average monthly spend at around US$14US$15.

While users might still be sceptical of FreedomPop’s offerings, investors are not. Stokols announced in June that the firm had raised US$30 million in Series B funding, bringing the total the company has raised to US$49.3 million. That’s not bad for a ‘free’ service.

CHINA: LAND OF MOBILE DRAGONS China has been long symbolised by the dragon, and it’s a particularly apt metaphor for the local mobile industry. Since China first launched its mobile networks, the market has outspent and outgrown its overseas counterparts in terms of subscriber growth, network rollout, and most other metrics measured by the industry.

China is currently home to some 1.3 billion mobile accounts, more than 15% of the world’s total. The ratio is even steeper for 4G, which is expected to serve some 400 million Chinese users by the end of this year, up from 96 million at the end of 2014 and none just two years ago.

That figure would make Chi-

na home to some 40% of the projected 1 billion LTE users globally, according to statistics from the Global Mobile Suppliers Association.

That kind of market presence goes a long way, especially when it is backed by two major equipment vendors and a robust handset sector.

A technology apart The Chinese government’s decision to mandate its own 3G standard, TD-SCDMA, for its incumbent mobile operator China Mobile has had a profound impact on the marketplace. While TD-SCDMA never gained the international adoption that the Chinese government had hoped for, it nevertheless dictated a path for 4G centred around the TDD version of LTE. That has led to a concerted effort by China Mobile to lobby for the development of TD-LTE, resulting in its development and, ultimately, integration with the global 4G standard. It’s debatable whether or not the global industry would have spent so much effort in developing TD-LTE if the world’s largest mobile market did not require it, but it is safe to say that TD-LTE is now an integral part of the global 4G ecosystem.

And that has changed the overall LTE landscape.

With the roll out of China Mobile’s TD-LTE network, suppliers have upped their game to supply TD-LTE equipment; many global vendors, as well as domestic suppliers Huawei and ZTE, are jostling for position to capture lucrative contracts. The result is a vibrant ecosystem with all the players trying to outdo each other with new performance enhancement and features.

As of today key advancements that have been made for FD-LTE, such as carrier aggregation, are already available for TD-LTE. In July, Nokia Networks showed off a TD-LTE-Advanced installation with carrier aggregation across two TDD bands (2.6GHz and 3.5GHz) to deliver download

speeds of 220Mbps.

More importantly, because TDD spectrum is less constrained when it comes to availability – it doesn’t have to be paired – there is more of it available for mobile broadband. In an earlier demonstration, China Mobile and Nokia Networks aggregated 3 TD -LTE carriers to achieve downlink speeds of 330Mbps.

And it’s not just Nokia; all the major vendors have developed solutions for TD-LTE-A. The question is when China Mobile, or other TD-LTE operators in the world – such as Optus in Australia – want the technology, and when handsets will become available to support such capabilities.

The best of both worlds The Chinese government didn’t stop at TD-LTE, as it did with TD-SCDMA for 3G. Earlier this year, it also handed licenses and spectrum for the FDD version of LTE to all three Chinese operators, paving the way for the first unified LTE market in the world.

While there are operators and markets that have both FDD and TDD spectrum set aside that can be used for LTE, China is arguably the first market to tell its three operators specifically that they now have licenses to build types of LTE networks.

Obviously, the financial burden of building two parallel LTE networks across a country the size of China is daunting. But it does motivate all the operators to try to merge the two technologies into a single network – and that is exactly what they are driving at today.

Dual-mode LTE, which inherently incorporates carrier aggregation since the network will be using carriers from both FDD and TDD spectrum, is now the focus for technology development for Chinese operators.

Earlier this year, China Mobile, through its Hong Kong subsidiary, demonstrated just that with help from Ericsson. The test system combined a 15MHz FDD carrier on the 2.6GHz frequency

band with two TDD carriers (1x20MHz and 1x10MHz) on the 2.3GHz band to delivery peak download rates of 272Mbps.

Similarly, all the major vendors have demonstrated at some point the ability to combine TDLTE and FDD LTE into a single network.

So far, the Chinese operators have not launched dual-mode LTE commercially. But their backing in its development will have far-reaching effects in the market; not only its development, but in the economies of scale it drives when producing network equipment and, most importantly, handsets.

Made in China The impact of China’s mobile industry on domestic vendors is evident, but its contribution to the country’s handset market is nothing short of phenomenal.

While Samsung and Apple conquered the rest of the world, China’s domestic handset industry has boomed – helped largely

by Google’s development of Android, which allows consumer electronics companies to produce smartphones with world-class functionality.

The success of companies like Huawei, Lenovo, Meizu, Xiaomi and countless others may not be a result of the technology choices of the Chinese government.

But the size of the market, and the commoditisation of the technology, has enabled these players to blossom into worldclass competitors. it. They are bringing smartphones to the mass market, particularly in emerging economies that have limited spending power.

Today, Xiaomi’s entry level model, the Redmi 1S, sells for roughly US$120 in Hong Kong, compared to US$800 to US$1000 for an iPhone 6.

In this way, China isn’t just changing the mobile industry; it is changing the world.

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