Win Win

Voice from Operators

Perspective

Tao of Business

Winners

09/2011

Issue 10

Etisalat Nigeria

Late entrant dreams big Romtelecom opens the door to ultra-broadband iODN: A key enabler for smart city Movistar Chile: Unleashing the potential of copper Telenor takes LTE to the Arctic

It's all about success! We aim to help you hear what operators would like to share in person, see how industry peers succeed in the fierce market, delve into their secret to success, and learn from the winners in the industry.

Sponsor Huawei Technologies Co., Ltd. Publisher Huawei COMMUNICATE Editorial Board Consultants Hu Houkun, Xu Zhijun, Xu Wenwei Yu Chengdong, Zhang Hongxi, Zhu Yonggang Editor-in-Chief Gao Xianrui (sally@huawei.com) Editors Xue Hua, Julia Yao, Long Ji, Michael Huang Zhu Wenli, Ranajit Sankar Dam, Xu Ping Li Xuefeng, Chen Yuhong, Pan Tao Art Editor Zhou Shumin Contributors Li Heshun, Fu Yu, Ma Xin, Huang Xinqiang Zhang Yufen, Cao Zhentao, Yang Sai, Loreto Dorado Zhang Qinfa, Wang Jian, Du Junwei, Tong Yongzhi Chi Feng, Liu Guliang, Chen Xinxin, Huang Liyan E-mail: HWtech@huawei.com Tel: +86 755 28789348, 28789343 Fax: +86 755 28787923 Address: B1, Huawei Industrial Base, Bantian, Longgang, Shenzhen 518129, China Publication registration No.: Yue B No.10148 Copyright © Huawei Technologies Co., Ltd. 2011.

All rights reserved.

No part of this document may be reproduced or transmitted in any form or by any means without prior written consent of Huawei Technologies Co., Ltd. Disclaimer The contents of this document are for information purpose only, and provided “as is”. Except as required by applicable laws, no warranties of any kind, either express or implied, including but not limited to, the implied warranties of merchantability and fitness for a particular purpose, are made in relation to contents of this document. To the maximum extent permitted by applicable law, in no case shall Huawei Technologies Co., Ltd be liable for any special, incidental, indirect, or consequential damages, or lost profits, business, revenue, data, goodwill or anticipated savings arising out of or in connection with any use of this document.

For electronic version and subscription, please visit www.huawei.com/winwin

Start here, make a difference The 2011 Universiade kicked off on August 12th in the southern Chinese city of Shenzhen. The opening ceremony was a huge success thanks to its meticulous approach to being “green” and representing the youth and vitality of university students. Almost as young as the event’s student athletes, Shenzhen was incorporated as a city 31 years ago and has been growing vigorously since. By hosting the event in an innovative, ecofriendly, and cost-effective manner, the city best symbolized the theme of the Universiade: “Start here, make a difference.”

When it comes to the ICT industry, we sometimes wonder what its ultimate goal is. The answer may be found in the vision of SoftBank for the next 30 years, as stated by its Chairman & CEO Masayoshi Son: “SoftBank works to make people happy through the information revolution, works to comfort people in their sorrow, and works to increase people’s joy.”

Indeed, the operator is working to realize this future by capitalizing on the information revolution, cutting-edge technology and the most outstanding business model.

Access to information has never been so easy, owing to the dazzling development of broadband technologies, the Internet and the Internet of Things in recent years. As an effective way of further improving information access, national broadband has become an important model for broadband deployment – and a global phenomenon. In the past two years, more than 30 countries have launched their national broadband initiatives, which are making a difference in people’s lives.

Though differing in national broadband construction models as well as business models, these countries have one common objective: to boost national broadband coverage and information levels and improve communications. This necessitates the building of a healthy value chain for national broadband development, where end users, service providers, broadband providers and even governments can be more creative and productive.

It also necessitates strategic thinking, as a national broadband strategy is critically important to the competitiveness and future of a nation. In Singapore, the NGNBN has evolved into a healthy ecosystem for business growth. Malaysia’s HSBB has developed into an environment in which broadband coverage can be achieved quickly. A level playground has been put in place in Australia to ensure fair competition in the broadband market… All these successes are evidence enough that national broadband is making a difference.

Yu Chengdong Chief Strategy & Marketing Officer, Huawei

09/2011 Issue 10

WHAT’S

INSIDE

Voice from Operators 01 Etisalat Nigeria: Late entrant dreams big Steven Evans, the CEO of Etisalat Nigeria tells WinWin that with the next big battle looming over mobile broadband, Etisalat is doing all it can to make sure it emerges as “an operator that Nigerians are proud of.”

05 TID: Leading the innovation at Telefónica Francisco Jariego, Director of Technological Strategy at TID, the R&D arm within the Telefónica Group, talks about how the revamped TID is going to support the Group’s coming business growth, especially in the seven new vertical areas.

Tao of Business 09 Putting VAS transformation in focus With the telecom industry under greater competition than ever before, many operators today realize that transformation in the VAS space is important for business growth. And for this, a change in mindset is key, says Shira Levine, Directing Analyst with Infonetics Research.

11 Harnessing the power

of subscriber information How can subscriber information be mined and idenfied? How can critical information be dug out of it?

Will operators become pure pipe providers or be able to control their resources and create proper value?

The game is on.

Winners 21 Romtelecom opens the door to

ultra-broadband

25 Qatar Telecom: One step higher

with fiber

29 Movistar Chile: Unleashing the

Perspective

potential of copper

15 National broadband: Creating a new

ecosystem with greater value Socially and economically, investment in broadband yields high returns. It is safe to say that the ecological value from broadband development is the very reason behind national investments in broadband. Yet operators need to well mitigate the potential risks.

19 iODN: A key enabler for smart city Integrating the optical network and Internet of Things technologies, iODN provides the basis of building a smart city. Delivering smart management to the passive fiber infrastructure, iODN can also be applied to municipal facilities like the power grid, drainage system, and transportation system.

32 Telenor Norway: Going north, takes

LTE to the Arctic

35 China Mobile: Forerunner in

synergized network development

39 China Telecom: Road to IPTV success

in Shanghai

45 MTN Côte d’Ivoire fulfills mission

impossible with NGBSS

Overall, we are determined to be one of the two top operators in Nigeria, and we are also keen to take a leadership position in data services, because we think that is very much a green field. — Steven Evans, CEO of Etisalat Nigeria

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Win-Win / SEP 2011

VOICE

FROM OPERATORS

EMTS: Late entrant dreams big Having launched its service at the end of 2008, the late-entrant operator EMTS (Etisalat Nigeria) is rapidly gaining ground in the Nigerian market. With eight million subscribers and on target to hit ten million on its third anniversary, the operator, which has just launched its 3G network, is gearing up for the battle over mobile broadband.

By Ranajit S. Dam

W

hen Etisalat Nigeria entered the Nigerian market some seven years after the first operator, few would have given it much of a chance. Instead, the currently fourthplaced operator has steadily gained market share since its entry in 2008 on the back of innovative products and a youthful-yet-quality image. CEO Steven Evans tells WinWin that with the next big battle looming over mobile broadband, Etisalat is doing all it can to make sure it emerges as “an operator that Nigerians are proud of.”

Unique challenges WinWin: You have more than 20 years of experience in the telecom industry, having worked with operators like Bouygues in France and Optus in Australia. How would you describe the challenges of operating in Nigeria, compared to these other markets?

Evans: There are a number of challenges. One is that there is a lack of well developed infrastructure, particularly power and transport. In practice, what this means for Etisalat Nigeria is that every single cell site of EMTS has to have two diesel generators, operating in tandem for 12 hours each. These have to be regularly and reliably supplied with diesel. The impact of the additional costs for power, transportation, diesel and the associated security on every site is significant and drives up the operational cost of the business.

Then, there is the problem of finding local talent for key positions. You have to remember that the Nigerian

mobile industry only started in 2002-2003, so it’s less than 10 years old. So if you want to find someone with 15-20 years of experience, you’re going to have to look among Nigerians who’ve been working overseas. Our Director of Engineering was working in Hong Kong for one of the operators there and we were fortunate to be able to convince him to come home.

WinWin: Are you exploring any alternative sources of power?

Evans: We’re doing a lot of work with Huawei on what’s called hybrid power. This involves sophisticated batteries that can help you store sufficient energy, so that you need to run the generator for only a few hours a day, instead of 24 hours. In terms of true alternative energy, we are investigating the potential of solar power, and also wind power, particularly in the northern part of the country, which tends to have fairly consistent winds, and lots of sunshine. We are planning to pilot perhaps five or six solutions over the coming 12 months.

A four-pillar strategy WinWin: Etisalat Nigeria came into the market two years ago, some seven years after the first operator.

How would you describe your strategy to make up lost ground?

Evans: Our strategy has four pillars to it. The first one, which is of paramount importance, is the quality of the network. We’ve decided that we want to be – and want to

Win-Win / SEP 2011

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VOICE

FROM OPERATORS

Since we are a late entrant, one of our strategies has been to offer pricing that is the same, regardless of whether calls are made to our network or to another operator’s network.

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stay – No. 1 when it comes to quality of network. Very recently, we did a whole series of drive tests across some 60 or so of the cities in Nigeria, and we came out No. 1 in quality of network in more than 50 of those cities.

To support this, we are also introducing innovative products and services, which we think the customers will appreciate, and that is the second pillar. The third area is customer service; we have very good customer care centers, and also very good retail shops with knowledgeable and well-trained staff.

Compared to the first three pillars, which are outwardfacing, so to speak, the fourth pillar is inward-facing.

It is about operational efficiency, making sure we keep our operating costs down, so that we can be an efficient organization with the flexibility to offer good value to our customers.

that lets you know if someone called you while you were away or on another call. Again, it’s a product that Etisalat is the only operator to make available.

Since we are a late entrant, one of our strategies has been to offer pricing that is the same, regardless of whether calls are made to our network or to another operator’s network. When you come into the market, and start with a small customer base initially, you need to reassure people who try Etisalat that when they make calls to another mobile phone, they don’t have to worry about whether it’s an MTN phone or an Airtel phone. So we have also been the pioneers of the concept of on-net and off-net pricing being the same.

WinWin: Can you give us a few examples of innovative products and services that you have introduced?

Evans: One of these is a “home zone” product, which allows customers to choose their office or home or another location as their “home zone.” Calls made from this zone, whether they were on our network, or on another network, are priced at a lower rate. Now the home zone feature is not new from a global perspective – it has been used in a number of different markets – but we were the first to bring it to Nigeria.

Also, there are some other things like reverse charge calling, which we introduced in this market. This is especially popular among young people, who at times have no credit on their phones, but would like to call home. It allows them to transfer the charge of the call to the called party’s account.

Another thing that we have introduced, and that people value a lot, is missed call notification. It’s a text message

WinWin: With mobile voice reaching maturity, the next area for growth in the Nigerian market is mobile data. How important is it to EMTS’ strategy?

Evans: We’re prioritizing it very heavily, as we think there is an incredible pent-up demand for data services.

One reason is that because of the lack of infrastructure, there is effectively no fixed network in Nigeria. Mobile broadband will be the first and only way to access the Internet for the vast majority of Nigerians, as only a relatively small number of large corporate organizations can afford to have fiber delivered to the building.

Another reason is that Nigeria is a very young market.

About 44% of the population of Nigeria is less than 15 years old, and the median age of the population is 19. In addition, there is a very big university population that uses laptops extensively. They are very aware of the Internet, very aware of the advantages of the various social sites such as Facebook, so they’re also looking to have access to data services. The challenge is now for the mobile operators,

Data opportunities

Win-Win / SEP 2011

We rely on the quality of the network to build a good reputation among our customers. Over time, we want to make Etisalat their preferred network, not their secondary one.

particularly the GSM operators, to build the radio infrastructure and the backbone infrastructure in Nigeria to deliver mobile broadband.

WinWin: What are you doing to facilitate the growth of mobile data, particularly mobile broadband usage, in Nigeria?

Evans: One of the products we have introduced in the market is Easy Cliq. Easy Cliq is a voice-and-data package that tells the customer, “Look, if you’re interested in browsing the Internet, there’s a certain amount of free data that comes with this product.” The package has been very popular.

As a late entrant, EMTS has placed mobile data at the forefront of its strategy. When we first rolled out our 2G network, we deployed EDGE on all of the cell sites, even the most rural cell sites out in the northeast and the northwest of the country. This meant we could offer data services right from Day 1. We were the only operator with data services everywhere on our network. Having recently acquired a 3G license, we are now working with Huawei to roll out our 3G network quickly. When we launch it in the first half of 2011, people will find that 3G really does deliver a materially improved data experience.

The road ahead WinWin: How would you describe Etisalat Nigeria’s goals over the next few years?

Evans: We’ve been growing at the rate of 400,000 net additions a month. What we like to do is lead with exciting and interesting promotions, which attract people to come and try us, and then we rely on the quality of the network to build a good reputation among our customers.

Over time, we want to make Etisalat their preferred

network, not their secondary one.

Overall, we are determined to be one of the two top operators in Nigeria, and we are also keen to take a leadership position in data services, because we think that that’s very much a green field.

Etisalat Group, which is our largest shareholder, is very strong in terms of its technology adoption and desires to be a leader in mobile broadband, and we feel we have every opportunity of leveraging some of the strength of the group, in terms of rolling out data services and mobile broadband services to our customers. We believe we can consolidate our reputation as a quality operator that offers high-speed mobile broadband to the market. I think we will have a blue-chip reputation among Nigerians and I hope that we will become an operator that Nigerians are proud of.

Editor: Gao Xianrui sally@huawei.com

Win-Win / SEP 2011

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VOICE

FROM OPERATORS

Our mission is to contribute to the Telefónica’s competitiveness through technological innovation in areas like networks, security, M2M, cloud, video, eHealth, communication services and platforms, user modeling & financial services.

— Francisco Jariego, Director of Technological Strategy, TID

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Win-Win / SEP 2011

Leading the innovation at Telefónica Telefónica Investigación y Desarrollo (TID) is the research and development company within the Telefónica Group. Since it was established in 1988, TID has been leading the technological innovation at Telefónica. Francisco Jariego, Director of Technological Strategy, talks about how revamped TID is going to support the Group’s coming business growth.

By Julia Yao WinWin: Can you introduce your organization, its responsibilities and role in the Telefónica Group?

Jariego: TID is the research and development company of the Telefónica Group. We run a complete open innovation framework organized around a network of innovation centres in Europe and Latin America. Our mission is to contribute to the Telefónica’s competitiveness through technological innovation in areas like networks, security, M2M, cloud, video, eHealth, communication services and platforms, user modeling & financial services.

WinWin: Can you give some examples of the most innovative products developed by TID that the Telefónica Group has launched in recent months?

Jariego: Let me start with Bluevia, the platform for developers to access communication services provided by Telefónica that has been recently launched, where TID has been the most relevant contributor. I would also mention GiffGaff, the UK based virtual mobile operator, built on Web 2.0 principles and oriented to participation and direct involvement of its user community. And not forgetting our over-the-top (OTT) video solutions that we are already commercializing in some of the countries where Telefónica operates, with different names like “Movistar Videoclub” in Spain and “Onvideo” in Telefónica Latam.

Just to mention a few of them.

WinWin: We know you are striving to build a “new TID”. What are the main changes expected, and what new contributions will it make to the Telefónica Group?

Jariego: First of all, our top priority is to add new revenue streams. Therefore, we are trying to focus on creating new areas of revenue for the Group, specifically focused on Telefónica’s seven new vertical areas: cloud, M2M, eHealth, financial services, applications and Internet, security, and video. The Group is aiming for EUR1 billion of new revenue from each vertical business

line in five years. So the new verticals will be an important asset in the coming years, and we are trying to contribute the R&D capability to achieve the goals.

But our activity goes beyond the needs already identified by the business. We are working on very different projects to explore new technologies and opportunities for Telefónica. And we are also promoting essential capabilities required nowadays like our “user experience” and research groups.

WinWin: What are the areas of research you are working on? Can you update us on the latest progress so far?

Jariego: We try to support Telefónica in its key R&D initiatives. Video and the Internet are two of our top priorities. The current Internet revolution is very important to us and we need to understand how to support the new applications and services and take advantage of our infrastructures. We have researchers working on this, collaborating with universities in the U.S. and Europe.

Another very important issue is to understand how customers behave. The new forms of communication that are currently evolving very quickly bring together voice, video and social networking; they are all evolving around how humans communicate. In order to understand our customers, we need to make the best use of data, after gathering, storing, and mining it. Data is a big enabler of M2M applications, which we are pushing as we enter new businesses.

WinWin: How important it is for Telefónica to work with global suppliers who are able to provide end-toend solutions in every part of the network including applications, servers and new business without any conflict with operators?

Jariego: It is clearly very important for Telefónica to have solid global partners. We have always worked

Win-Win / SEP 2011

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VOICE

FROM OPERATORS

We focus on creating new areas of revenue for the Group, specifically on Telefónica’s seven new vertical areas: cloud, M2M, eHealth, financial services, applications and Internet, security, and video.

with them because the telecommunication industry is a complex industry where you need to put together different services, hardware, software and infrastructure from very different market agents.

For TID, partnerships are critical. We firmly believe in the open innovation concept. We don’t want to be a very large company, so we need to concentrate on our core competences and allow our partners to complement us.

The key to success is to have partners who understand what we are doing, and who can develop, extend and amplify the things we are doing. Telefónica today has a global presence and we need to have physical presences in many places. Having the capability to reach all the markets in which Telefónica is operating is important for us. It’s the way we want to move forward at Telefónica R&D. WinWin: How would you comment on your cooperation with Huawei, and how can it develop further?

Jariego: Telefónica and Huawei’s relationship is relatively new but it is a very promising one. Huawei has managed to become one of the key suppliers of our network. Among our initiatives are joint innovation centers, where we collaborate and test the technology, so as to better understand how we can apply it in certain areas.

But I think that we must push our relationship further.

Technology is changing very rapidly and creating lots of opportunities. Putting together the strength and capability of Huawei and our knowledge of Telefónica is a good recipe to create new opportunities for Huawei and Telefónica TID. I firmly believe that our relationship can be very productive.

WinWin: Since 2008, Telefónica and Huawei have been running innovation projects under the Joint Innovation Center initiatives; these projects involve network, mobile and service, among others. Can you

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share with us the benefits the joint initiatives have brought to Telefónica and its customers?

Jariego: Joint Innovation Center is a good example of collaboration within our open innovation framework.

We are able to participate in the early stages of Huawei’s technology development, by introducing our needs and requirements, exchanging visions, data and experiences, and helping to focus our common effort. Thanks to these joint initiatives, we are together investigating on topics such as how to provide an excellent Quality of Experience for future LTE users, how to enhance xDSL performance, new functionalities on next generation FTTx access networks, and definition and design of future services that can run over the Service Delivery Platform provided by Huawei.

WinWin: What benefits is the strategic alliance between Telefónica and China Unicom bringing in terms of innovation?

Jariego: Of course, the alliance is bringing economies of scale, for example amplifying our capacity to profit from joint procurement initiatives. But perhaps, the most important aspect is that it is helping us understand the Chinese market.

China offers a huge opportunity for Telefónica, but if we want to succeed, it is necessary to understand a different culture, overcome the language barrier and learn a lot of new things. So I think that there is much to be explored in our relationship with China Unicom.

WinWin: In a speech by Telefónica Group Chairman & CEO Cesar Alierta at the GSMA congress this year, he emphasized the key role that telcos have to play in the ICT ecosystem. Similarly, Huawei has made a strategic expansion into the enterprise and device markets. Talking about ICT sector challenges, how can TID facilitate Telefónica’s move into the ICT sector?

Jariego: One of the things we are pushing is our

Win-Win / SEP 2011

With Joint Innovation Centers, we are able to participate in the early stages of Huawei’s technology development, by introducing our needs and requirements, exchanging visions and experiences, and helping to focus our common effort.

knowledge of software technologies. I think most of what is going to come will be related to the mastering of certain software technologies and products and services based on software. Our industry has built on the magic of Moore’s law, the periodic doubling (18 months) of capacity of our basic infrastructures: the communications equipment based on hardware. Fortunately we are going to enjoy this magic for ten years more.

But we don’t have an equivalent of Moore’s law for software. And software is the raw material on which digital services are built. So mastering software, and understanding how to use and create useful software technologies and business models based on software is what we are doing right now.

WinWin: The telecom space is facing a different environment now, with new technology and new competitors like Google and Apple. How do you think Telefónica can compete in this environment?

Jariego: They are very formidable players. They have created a surge in innovation, and they are here to stay.

There is a need to understand, from an industry point of view, the best way to sum, to put together our different and complementary capabilities and bring the best products to the market in a sustainable way. One of the things we are doing in this new market environment is opening our infrastructures as well as our R&D facilities, so that more companies can develop services on top of them. The company is moving in this direction with initiatives like Bluevia and WAC where TID is playing a key role.

However we cannot forget that we are competing according to very different rules. The telecom industry is a highly regulated industry while those Internet companies are competing in markets without regulations. If we solve the basic regulation problems, we can expect a very productive environment for innovations and new services.

Editor: Gao Xianrui sally@huawei.com Win-Win / SEP 2011

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Tao of Business With the telecom industry under greater competition than ever before from cross-industry players and content providers, many operators today realize that transformation in the VAS space is important for business growth. And for this, a change in mindset is key, says Shira Levine, Directing Analyst with Infonetics Research.

Infonetics Research

Putting VAS transformation in focus

By Ranajit S.Dam

A need for transformation WinWin: Operators today are threatened by players in different industries. How can telcos transform themselves in the VAS space in order to deal with this?

Levine: Operators have always had competition. The difference now is that they are dealing with competitors that have brand. So you look at Apple or Google: They have content relationships, which operators have typically not been good at establishing, and they don’t have the same legacy infrastructure that operators have to face.

So how can operators leverage VAS to deal with this?

I think they really need to understand what they have at their fingertips, what kind of assets they can capitalize on, things like presence information and subscriber information. So I think it has become important for operators to figure out what kind of strategy they want to take. Do they want to partner with the over-the-top providers, possibly providing things like subscriber data, do they want to create their own ecosystems, or do they simply want to be the pipe? I would say most operators are not going to pursue that last strategy. You’re always going to get some subset that figures out what’s their best business model. So there is no one-size-fits-all strategy.

WinWin: What other factors are now driving operators to transform in the VAS space?

Levine: I think the No. 1 factor is churn. Some of the developed markets are rapidly hitting their saturation points, particularly in the mobile space. In emerging markets, we see very rapid subscriber growth, as well as

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hyper-competitive markets. What operators have found, though, is that the larger number of services they can sell to a subscriber, the stickier that relationship becomes. So they’re really looking for ways to maximize the number of services they can sell, and really improve their retention that way. The other factor is revenue per user. We’re seeing ARPU flat or even declining in some markets.

Price pressures are really affecting operators, particularly in markets like North America – where they have really gotten the all-you-can-eat model – with operators not being able to increase prices due to the competition. So they’re looking for ways to improve revenue per user by providing value-added services.

Mindset is most important WinWin: What steps can operators take to get the best return on their VAS investment?

Levine: I think the most important thing is not a technology issue; it’s a people issue. It’s a mindset issue.

Operators need to have buy-in at the highest levels.

Because what they’re talking about doing with VAS strategy is breaking down traditional service creation and service delivery silos, and creating more of a unified approach to delivering services to the customer. From a technology standpoint, I think it becomes important to look at solutions that can grow with subscriber growth, grow with services growth, otherwise you just end up with yet another silo, and that really defeats the entire purpose.

WinWin: Can you give us a few cases of how operators

Win-Win / SEP 2011

The most important thing is not a technology issue; it’s a people issue. It’s a mindset issue. Operators need to have buy-in at the highest levels.

— Shira Levine, Directing Analyst with Infonetics Research

today are approaching VAS transformation?

Levine: Transformation today is an ongoing thing, and operators aggressively pursuing it are in the early stages. And they are using different approaches. You look at an operator like Telefónica, for example, actively pursuing a digital app marketplace approach. It’s really targeting the consumer market with value-added services.

You have other operators like Zain for example, which is basically providing value-added services to third parties like advertisers, by exploiting subscriber data and location information. And then you have operators like SFR, which is taking more of an enterprise approach to VAS in terms of cloud-based services to their enterprise customers.

There are certainly a number of ways to approach this opportunity.

WinWin: A number of operators have joined the Wholesale Applications Community (WAC) in an attempt to combat the Apple’s App Store and other similar stores. What advantages and disadvantages do they face in this regard?

Levine: I’d say the primary disadvantage facing operators now is that they’re late to the market. When you look at the success of the App Store and the Android Marketplace, you see they are far ahead of where the operators are, and where they need to be. The other primary issue is brand. Everyone knows the Apple App Store, and operators really need to play catch-up with that.

What operators have, though, is that relationship with the subscriber. They have subscriber information, they have a direct relationship with the subscriber, and I think that’s going to be their primary advantage in devising their

app store strategy. And an advantage of the WAC is that it lets them outsource the developer relationship, which is something that has historically not been their core competency. The WAC enables them to hand it over to a third party.

Key technologies WinWin: How vital is the SDP to VAS transformation?

Levine: I think the SDP needs to be the basis of the VAS transformation. Typically, services have been delivered in vertical silos: You have a video service delivered over a videospecific network and service-delivery environment, and the same thing goes for voice and data.

With VAS, the idea is you’re able to be more creative in combining, packaging and selling services. That is really the point behind a service delivery platform; it’s more of a horizontal services layer. I think if you’re really looking at a comprehensive VAS strategy, you need something like an SDP. WinWin: How can cloud be utilized in the VAS space?

Levine: I think cloud really enables operators to reduce some of the risk related to technology associated with VAS, and also allows them to outsource some things that may not be part of their core competency, things like content relationship, API exposure and so on. So I think you’ll see a lot of operators looking at cloud as a way to get into the market quickly and with minimal risk and minimal capital expenditure.

Editor: Gao Xianrui sally@huawei.com

Win-Win / SEP 2011

10

Tao of Business

Harnessing the power of subscriber information Leveraging the profile information of more than 500 million users, Facebook is now competing directly with various cross-industry players, including telecom operators. How can operators avoid becoming simply pipes, and instead control their resources and create value?

By Wu Hao

The power of address books Fa c e b o o k s a w i t s m a r k e t capitalization reach USD82.9 billion on SharesPost on January 28, 2011, taking it past Amazon and placing it second only to Google. Its stock price fluctuated around USD55 in Q1, which meant that most investors valued it at more than USD100 billion.

Why are investors so optimistic

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about Facebook? It is because Facebook has more than 500 million users and knows their social relationships.

Leveraging the profile information, Facebook covers nearly all the Internet business models. A real competitor of Google has appeared.

Similarly, in China, Tencent also has more than 500 million users and has a presence across nearly all Internet business models. Its stock price has also kept hitting new highs.

Social networking has become so popular that leading organizations within and beyond the industry are preparing to tap into its potential. Nonetheless, telecom operators, despite having larger user information databases

Win-Win / SEP 2011

A lack of innovation, however, means that operators have never been able to leverage the potential of the address books. Meanwhile, user and media attention to personal privacy has made operators act cautiously.

than those of Facebook and Tencent, along with real and accurate data on social relationships, have not received equal attention from Internet investors.

With basic communications services such as voice services, short messaging service (SMS), and Internet access, operators have valuable data such as personal information, usage habits, and communication records.

They have direct access to first-hand, real-world social relationships between customers, and this is primarily in the form of mobile address books. A lack of innovation, however, means that operators have never been able to leverage the potential of these address books. Meanwhile, user and media attention to personal privacy has made operators act cautiously.

New applications thrive Although operators have not found a good way to tap into the potential of mobile address books, this is not a problem for innovative technology companies looking to cash into the growth of the mobile Internet and smart devices. For example, Kik Messenger was launched on October 19, 2010. Developed by a team led by Ted Livingston, this messaging application gained one million registered users within two weeks of its release. That number topped two million six weeks later, and exceeded four million by July 2011. It is undoubtedly a successful innovation. What does Kik provide to its users? Why is it growing so rapidly?

To answer these questions, we need to look at the differences between Kik Messenger and traditional addressbook-based messaging services provided by operators.

Use of existing social relationships K i k Me s s e n g e r o f f e r s s i m p l e i n s t a l l a t i o n a n d registration, with an uncomplicated guide helping you

through the program interface. The program first scans users’ mobile address books, and is able to add contacts currently using Kik as Kik contacts. It then enables messages between Kik contacts; users can also invite other friends to become Kik users. Such a way makes full use of existing social relationships, and users need not maintain a separate set of contacts.

Excellent user experience Kik provides a chat-like user interface for receiving and sending messages similar to instant messaging software, eliminating the need for users to learn anything new. It is a lightweight, easy-to-use mobile application with a clear interface, proper division of functionality, and high interaction efficiency. Kik runs smoothly and reliably, making it at least as good as applications built into the mobile phone.

A much lower cost Compared with SMS, which costs money, Kik is a free messaging service. Users only need to pay for the data traffic, which comes to a few hundred bytes or less for every message sent. The cost is therefore minimal.

The FaceTime video calling feature of the iPhone 4 and iPad 2 is a service with similar features, except that it provides video calls instead of messages. FaceTime provides an excellent experience through video calls without the participation of an operator, while the rapid popularity of Kik has resulted in several similar attempts within the telecom industry. Here is a closer look at some popular communications applications based on Internet architecture: WhatsApp: WhatsApp Messenger is similar to Kik in terms of functionality and usage, but it features a simpler registration process in which no account or password is needed. Instead, the mobile phone number of the user

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Tao of Business Innovative mobile communications services have undoubtedly pushed operators to the verge of being bypassed again. Such services have shaken the foundation of traditional communications services.

serves as his/her WhatsApp account. After it is installed, the program automatically scans the user’s address book and, adds contacts who are already using WhatsApp, making it very convenient to use. WhatsApp supports mainstream smartphones such as iPhone, Androidpowered phones, and BlackBerry. It enables immediate reception of texts, pictures, audio files, and video information from buddies.

Weixin: The service from Tencent supports receiving and sending texts and pictures. Its latest version supports voice messages. Weixin also supports mainstream smartphones like iPhone, Android and Symbian phones.

TalkBox: TalkBox is an application for sending voice messages, eliminating the need for typing on the mobile phone. By sending voice messages quickly, it achieves speed and immediacy. Users may either manually add their buddies or synchronize their buddy list using their Facebook account. TalkBox features simple onetouch voice recording. It comes with a message push mechanism and also group chatting, so multiple users can communicate at the same time.

Qik: Qik is a mobile video software provider acquired

by Skype. Its Qik Video Connect is a mobile video application that enables users to stay in touch with friends and family members by means of video calling, messaging, and sharing. Qik integrates users’ address books to allow them to easily check whether their friends or family members are available for real-time video chatting. If they are unavailable, users may send private video mails to them through email or SMS, no matter what devices or phone networks they use.

Tango: Tango is a free, high-quality video calling application. Unlike FaceTime that restricts usage to only Wi-Fi, Tango is able to work on both 3G and Wi-Fi. It also scans users’ mobile address books. Users may enjoy video calling by paying merely the cost of data traffic. fring: fring is free cross-platform (iPhone, Android,

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and Symbian) mobile VoIP software. It provides video calling services through 3G or Wi-Fi networks. It features enhanced functions through the real-time availability of online contacts, as users can see online contacts before they make calls. It enables communication with Skype, MSN Messenger, Google Talk, ICQ, AIM, and conventional phone contacts. It provides steady connections with higher stability of video and voice calls.

Success not accidental The success of innovative communications services is not accidental. Instead, it relies on several key factors.

Penetration of smartphones Smartphones have been receiving unprecedented attention since Apple launched the iPhone. With lower barriers, Google Android and numerous mobile phone vendors with the Open Handset Alliance (OHA) have stimulated the smartphone market to start a period of wild growth. Low-end and mid-range smartphones are sold at the prices feature phones were three or five years ago. With the natural replacement of mobile phones and subsidy policies of operators, a lot of consumers have turned into smartphone users. Smartphone operating systems (OSs) provide fertile soil for innovative applications due to their higher computing power and storage capacity, support for multiple access modes, and excellent software extensibility.

Emergence of mobile Internet The penetration of smartphones has brought computing centers closer to users. Users may carry networks with them, which has greatly stimulated the growth of the mobile Internet. Wi-Fi has become a required option for home and office environment thanks to years of efforts

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made by various industry players. The 3G wave is sweeping the globe with help from operators and equipment vendors. Wi-Fi and 3G improvements have been rapidly increasing mobile access speeds. These devices provide consumers with a good mobile Internet experience, while consumer demand is driving the fast growth of the mobile Internet.

Social networks Through consumers’ mobile address books, real-world social relationships are easier to maintain than those on Facebook and QQ. It is costly to reconstruct social relationships, while consumers do not want to migrate their social networks. Starting from mobile address books is therefore a convenient and effective way. These services enable more convenient mobile communications since they use existing social relationships.

Operators must adapt Innovative mobile communications services have undoubtedly pushed operators to the verge of being bypassed again. However, it seems to be more relentless this time, because such services have shaken the foundation of traditional communications services.

Traditional communications services are the cash cow of operators, while data services are always in an awkward situation where revenues from those services do not increase with traffic. Innovative communications services happen to be data-based services that are eating away at operators’ traditional communications services, which may become disastrous for them.

Operators already suffered pain when Skype was launched. Should they face the challenge head on or stick to restrictions on VoIP services? Today, Skype includes

messaging and video calls. Moreover, it utilizes mobile address books, which operators have long believed to be their possession.

The vested interests will never readily exit. Major European telecom operators have reportedly planned to revise Internet data transmission regulations to charge traffic fees from online content and service providers such as Google. They complain that their networks are forced to respond to the pressure from the data explosion but that they have not achieved the requisite revenue growth from it. Most data traffic is for the U.S. websites such as YouTube, a video service website of Google.

Nonetheless, there are two sides to everything.

Operators have a great deal of information about their subscribers, and operators know who they are, who they contact, and what time they leave home for work, break for lunch and take an afternoon coffee break.

Subscribers use various services, and operators know their service preferences, their choices of colors, and how they interact with media. They even know that the users do not like Lady Gaga and skip to the next song before the current one is over. Such information is the very treasure coveted by every innovative IT company attempting to enter operators’ territory.

This raises more important questions: How can this treasure be mined? How can valuable data be identified?

How can critical information be dug out of it? How can private information be distinguished from that to be made public? A new way will become available to operators as long as they recognize the market position of innovative IT companies, try to answer those questions, and provide such companies value beyond that of pipes.

The game is on. Will operators become pure pipe providers or be able to control their resources and create proper value? Let’s wait and see.

Editor: Pan Tao pantao@huawei.com

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Perspective

National broadband Creating a new ecosystem with greater value

By Nan Ningxuan & Wang Qin

Broadband has become a bellwether of national competitiveness.

According to statistics and analyses from the World Bank, 10% increase in broadband usage translates into 1.38% GDP growth. Therefore, broadband gives the best ROI in telecommunication services. Based on available statistics, the European Commission (EC) predicts that broadband will bring more than two million jobs and contribute EUR636 billion to GDP growth for Europe by 2015. Socially and economically, investment in broadband yields high returns. It is safe to say that the ecological value from broadband development is the very reason behind national investments in broadband.

When it comes to broadband deployment, operators need to be aware of the potential risks such as huge investments, long payback periods, a lack of drive for end users to use broadband, a shortage of profitable services, and unclear telecom policies and regulations. Broadband traffic is outpacing Moore’s Law, forcing operators to consider how to balance between broadband traffic and revenue so as to end the broadband dilemma. Given these challenges, operators need to devise clear development strategies for operating broadband, building a value ecology, developing services, and attracting customers.

Requirement for new business models The payback period for massive broadband deployment varies from area to area. It takes four years to recover

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the initial investment in densely-populated urban areas, eight years in suburban areas, and 15 years in rural areas.

Investment in urban areas is a better shot because urban areas are usually competitive markets. It takes certain risks to invest in suburban areas due to the population. Rural areas are usually policy-driven markets, and the investment can provide assured returns but the payback period may be longer.

In terms of network layers, the payback period is 12 to 15 years for the passive optical network, five to seven years for the active optical network, and one to two years for the service network. To minimize the payback period, different countries and regions adopt various business models. For example, Singapore uses an open three-layer model consisting of the passive optical, active optical, and service networks. The UK and Italy both use an open twolayer model. In the UK, the passive optical network and the active optical network form one layer and the service network forms the other layer, while in Italy, the passive optical network forms one layer and the active optical network and service network form the other layer.

The broadband construction model varies from country to country. Advanced business models are required to suit the state-of-the-art technologies and different construction models to form a healthy ecosystem, where end users, service providers, and broadband providers can benefit.

Actors across the ecological chain of national broadband have different requirements. End users are concerned about network speeds and tariffs and service providers are keen on service innovation and high-quality user experience, while network providers focus on the design, construction, delivery and operation of networks, and governments attach more importance to economic development, employment, broadband coverage, as well as open and fair competition. Therefore, the key to developing a successful

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Only when people are willing and able to use broadband for communication and every actor on the ecological chain benefits from it, can broadband grow healthily.

national broadband business model is to analyze and meet the requirements of each actor on the ecological chain.

Value ecology in the making National broadband solves the issue of connection, yet the key to successful connection is not broadband. The average broadband speed in the U.S. is not even within the top 18 in the world. The ICT revenue there, however, accounts for 30% of the global market, and its profit represents up to 40%. This is because America has a better value ecology for broadband. The success of American national broadband lies in the specialized National Skill Redevelopment Program. Only when people are willing and able to use broadband for communication and every actor on the ecological chain benefits from broadband, can broadband grow healthily.

Besides, countries that are deploying or operating broadband have gradually formed their own ecological environment.

to build a healthy value ecosystem for the first stage by drawing on the U.S. experience. Investing in newlyfounded companies, the Singaporean government has built the Next Generation Nationwide Broadband Network (NGNBN) to ensure open and fair competition in the broadband market. As a pivotal part of the Intelligent Nation 2015 (iN2015) project, the NGNBN has an active optical network in which the government has invested SGD250 million (USD208 million). Built and operated by the newly-founded company Nucleus Connect, it is expected to cover the whole island country in 2012, providing 1Gbps access

Singapore: A healthy ecosystem for business growth As the first country in the world to implement the national broadband project, Singapore aspires

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Perspective

The government’s cooperation with Telekom Malaysia will reduce CAPEX by 36% at least, which can be spent building a healthy ecosystem for national broadband development.

bandwidth for enterprise users, and 100Mbps for home users.

The NGNBN adopts a wholesale-dominated business model. In accordance with the regulations of Infocomm Development Authority of Singapore (IDA) , the passive optical network services provider (Netco) wholesales optical fibers to the active optical network services provider (OpCo); likewise, the OpCo wholesales the bandwidth to Retail Services Providers (RSPs) who then provide bandwidth and associated services for end users. Quality of service (QoS) is classified into A, B, C, and D based on the service type. The wholesale price is also determined by the service type. If necessary, OpCo will provide RSPs with service platforms and management and maintenance services.

After looking into the growth of subscribers at the early stage, the Singaporean government has launched two nextgeneration interactive multimedia services platforms based on broadband: Next Generation Interactive Multimedia Applications and Services (NIMS) and universal set top box (STB). While allowing all users to enjoy various services, both platforms reduced the number and cost of home devices of end users. Meanwhile, the government has issued the Cross Carriage policy, which requires that operators should share contents with each other. In this way, operators do not have to compete to provide exclusive contents and end users can enjoy contents at lower prices.

While implementing its national broadband project, the Singaporean government is also keen to improve the professional skills of its staff and promote services.

To attract users to the national broadband, IDA and its partners have jointly established a service innovation center, enabling people to experience the services and the brand-new digital lifestyle brought by the Nationwide Broadband Network (NBN) and helping them understand

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and use the services.

Malaysia creates ecology for rapid broadband deployment To popularize broadband ser vice quickly, the government can ask an Incumbent Local Exchange Carrier (ILEC) to construct the national broadband network and require it to cooperate with other operators.

Malaysia and Qatar have both adopted this model for national broadband deployment. This model requires less government investment, allows for pipeline resource sharing amongst operators, and shortens the construction period. However, it is not effective in ensuring fair competition. Malaysia’s national broadband is, for example, constructed by Telekom Malaysia (TM), and Qatar’s by Qatar Telecom (Qtel).

The Malaysian government commissions TM to undertake the national broadband project, High Speed Broadband (HSBB), with the view to helping transform Malaysia into an intelligent society and achieve both national economic growth and per capita income improvement. The government has invested MYR2.4 billion in national broadband. In fact, researches have also indicated that the positive impact of broadband services toward the annual GDP will be 1% with an estimated 135,000 new jobs being created by 2010. The government’s cooperation with TM will reduce CAPEX by 36% at least, which can be spent building a healthy ecosystem for national broadband development.

Promising to open its network, provide fair access, and wholesale services to other operators, TM has covered all government offices, schools and research institutes with broadband. It has also extended broadband coverage to remote areas in a bid to bridge the digital divide. This

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The national broadband project of Australia is intended to break the monopoly and bring in fair competition. The government has acquired all Telstra’s last-mile resources by controlling the telecommunication license.

has created a win-win situation for all stakeholders. Till now, TM has worked with partners to provide national broadband coverage for more than one million users in Malaysia, a country that has arguably the most complex geographical environment featuring a large number of islands as well as tropical forests and mountainous regions. In doing this, it has helped improve the nation’s information infrastructure and speed up its economic growth.

The national broadband project of Australia is intended to break the monopoly and bring in fair competition. The government has acquired all Telstra’s last-mile resources by controlling the telecommunication license, which ensures rapid deployment and coverage of the Optical Distribution Network (ODN). It is estimated that, in addition to promoting the economic growth and creating new jobs, the national broadband project will secure 6% of the revenue for the government.

Australia: An ecology for open and fair competition

New ecosystem for greater value

Broadband prices in Australia rank top among the Organization for Economic Cooperation and Development (OECD) members because of the monopoly in its fixed broadband market. Statistics show that the average yearly broadband expense exceeds AUD2,000 (USD2,114) per Australian home user and AUD10,000 per enterprise user. The broadband access speed there, however, ranks fifth from the bottom worldwide. To encourage competition in the broadband market for its healthy growth, the Australian government has broken the monopoly of dominant operators and acquired pipeline resources to open them to all operators.

The national broadband initiative of Australia has been implemented since April 2004. It is expected to provide 100Mbps services for 93% of the population through fiber to premise (FTTP) technology, 12Mbps services for 4% through LTE technology, and 12Mbps services for the remaining 3% via satellite technology. The government has invested AUD47 billion in the newly-founded company NETCo, which takes charge of operation and provides wholesale services only. This ensures open and fair access to the network.

All in all, national broadband will help cultivate a new and healthy ecosystem conducive to more cooperation between players such as the government, operator, provider, and customer.

The end user will be able to enjoy integrated services and get immediate help whenever a fault occurs.

Traditional operators can consolidate their position in the market if they can leverage national broadband as an opportunity to play an active role in building the ODN and active optical cable platform. Emerging operators can better benefit from the open access network of national broadband, which provides equal platforms and frees operators from network deployment and maintenance.

They can focus on providing more attractive and flexible services for their customers, enhance their brand, and expand their market share.

With national broadband, the old ecosystem is declining, and a new and open one is in the making. All actors on the value chain should, by leveraging their own resources, contribute to a healthy value ecosystem for themselves and their nations.

Editor: Xue Hua xuehua@huawei.com

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Perspective

iODN: A key enabler for smart city Integrating the optical network and Internet of Things technologies, the intelligent optical distribution network (iODN) provides the basis of building a smart city. Delivering smart management to the passive fiber infrastructure, iODN can also be applied to municipal facilities like the power grid, drainage system, and transportation system.

By Ni Bei

Smart city and its challenges

A

future-oriented kind of city, the smart city highlights the importance of the telecom network and the Internet of Things. The smart city covers various aspects, including road monitoring, smart hospital, city management, security, family nursing, as well as personal health and digital life. All these require a higher service level assurance (SLA) to ensure smooth operations.

The optical network infrastructure and other parts, like the power grids, buildings, and bridges are all passive elements or “dumb resources.” Manual operation is needed to check these assets and this incurs low efficiency and possible errors. For example, some operators in Japan spend about 10% revenue to maintain their optical networks; and some operators see 30% of their optical resources in an idle state due to improper management.

This cannot meet the development of smart cities.

To balance the development of urban and suburban areas and better cater to people’s needs, a smart city should enable smart management by first collecting massive infrastructure information. As interconnection and coordination can be applied to share the information, the infrastructure can be utilized in a more flexible and

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efficient way. The smart city can also help to ease the conflict between the surging population and inadequate public resources, ensuring a safer, more efficient and convenient and greener city environment.

In a smart city, the telecom network should provide high bandwidth, wide coverage, massive data, mobility, and collaboration. This will result in an explosive growth of broadband network in the coming years. China Telecom, for example, planned to expand the FTTH network with 100Mbps access to pass 30 million homes in 2011, raising up the total capacity to cover 40 million homes. Statistics also show that 800 million FTTH lines will be deployed globally in the next three years. In this context, high investment will inevitably be needed due to the increased maintenance and manpower costs.

“Dumb resources” is one of the challenges facing the smart city. As the basis, the telecom broadband nestwork needs to be highly efficient, automatic and intelligent so as to enhance the efficiency and ensure the smooth operations of network infrastructure.

iODN eliminates “dumb resources” Through an identification (ID) technology to identify

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relevant resources, iODN can intelligently identify, position, trace, monitor, and manage the optical network resources in the following ways.

First, intelligent optical network elements are applied as the hardware basis for intelligent management. ID sensors are added to optical fibers, manholes and hand holes to eliminate the “dumb resources.” Moreover, automatic cable distribution technology has been applied to realize remote control of optical fibers. All these serve as the foundation or platform to manage the optical lines, optical resources, and equipment information.

Operators can also use iODN to detect and monitor fiber connections, navigate and schedule operations on optical fibers.

Second, iODN sets up a data collection and monitoring system to make network resources visible. The system serves as a data transmission channel between optical network and the network management system (NMS). It transmits information like equipment attributes, connection details, as well as remote maintenance and engineering data. In addition, the system stores data related to GIS and engineering.

By analyzing engineering data, the system can guide the engineer for easy and correct operations. By comparing the collected data with the legacy one, the system can detect the change and report any possible fault to the NMS. All data is recorded and reported automatically.

Finally, iODN makes network resources manageable and controllable through the NMS. Operators can monitor the network routing topology, utilization of network resources, and line quality. They can also perform active O&M based on how the optical routes are assigned, scheduled and implemented, realizing remote monitoring and maintenance of data related to the devices and lines.

With these features, iODN enables the legacy passive optical network to become a “smart network”. Operators can not only learn of the utilization and geographical location of various types of network resources in real time, but also can allocate and connect resources automatically.

In addition, iODN can sense the “health status” of network resources by means of self-inspection and implement self-recovery using backup routes.

By deploying a “smart network”, operators can enhance their optical network utilization and maintenance efficiency.

With lowered optical network investment, operators can build a smart network that meets the diversified requirements of families, enterprises, and governments.

Smart city, starting from iODN Jin Dongbin, Deputy Chief Engineer of China Telecom, remarked that, as a means to manage the Internet of Things resources, iODN can not only be applied in the telecom field, but also be used for the management of pipelines, infrastructure, and other resources of smart

cities, and all these can be centrally managed through cloud computing technology. In addition, specific cloud terminals can be developed for the smart city.

Smart drainage system Since 2011, many cities in China had been affected by heavy rainfall, which made drainage systems a key area of concern for residents. iODN can be deployed to build a smart drainage system to solve the challenge.

The smart drainage system identifies the water supply and drainage pipelines and facilities. In this context, the drainage condition can be monitored around the clock, while systematic analysis of the overflowing and water-logging process can be applied. Monitoring personnel can then remodel the drainage pipelines and avoid possible flooding.

In addition, through real-time monitoring, the system can identify the domestic and industrial wastewater, and discharge them at different times and phases to avoid secondary pollution. With the effective control, problems like aging pipeline, pipeline rupture, and water spills can be detected and solved in a timely manner, realizing inservice detection and repair of water pipelines.

Smart grid i O D N c a n i d e n t i t y k e y p owe r s u p p l y d e v i c e s and realize online monitoring of power generation, transmission, distribution, supply, and utilization.

Obtaining the running status, iODN can deliver alarms in advance, identify the faulty device in time, facilitate troubleshooting, and ensure the best performance.

The advanced technology can also be integrated into the legacy systems of a power enterprise, optimizing the operation and troubleshooting process, while strengthening the management capability. Power grid designers can also have better tools and information to sharpen their innovation skills. In this context, better management can be applied on the power grid construction and maintenance.

Smart home Using the iODN technology to identify home facilities can help realize safe, comfortable, and intelligent management of home appliances. For example, by integrating all home appliances into a smart network, users can query information of the home appliances or the information can be displayed automatically. Users can also schedule the operation of different home appliances and pick their favorite model. With the management software installed in their mobile phones, they can perform remote management and receive status alarms.

Editor: Xu Ping x.ping@huawei.com

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Winners

Romtelecom opens the door to ultra-broadband

By fully utilizing available resources and choosing the GPON+FTTB model, Romtelecom opened the door to ultrabroadband. And it made a one-off investment to support long-term evolution for its network and ensure its success in the future broadband market.

By Huang Xinqiang

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Editor: Xue Hua xuehua@huawei.com

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FTTx: The only way to high-speed broadband access

R

omania has enjoyed an impressive annual GDP growth rate of over 6% over the past years and reaped dividends of having a ver y large population of young people. Both factors have explained the country’s booming broadband market. That should have been good news for Romtelecom. However, it was just not the case.

Like most incumbent operators, Romtelecom faced a tough situation – fierce competition, an aging network, and a high user churn rate. Due to its relatively slow start in broadband deployment, from 2007 on, Romtelecom had lagged behind other operators in the number of broadband users. Understandably, it was eager to establish its leadership in the broadband market.

Difficulties lay ahead, though. On the one hand, with its original ADSL access based on central offices, Romtelecom simply could not provide competitive broadband and differentiated service. Therefore, FTTx was the only way for the operator to provide high-speed broadband access.

On the other hand, FTTx would entail huge investment and a long deployment cycle. Worse, other Romanian operators had kicked off FTTH deployment earlier, which made it more difficult

for Romtelecom to gain a competitive edge in the market.

How should the operator best use its limited resources to have the upper hand in competition?

Unlike its competitors, Romtelecom did not take the FTTH as the answer, which would otherwise result in the highest CAPEX and the longest deployment cycle. Rather, as a longer-term goal, it went for the FTTx model that was the most suitable for it. While trying to save on CAPEX, Romtelecom found it necessary to preempt its competitors in network deployment and cover high-value regions as quickly as possible. The operator was also convinced that the FTTx network should allow for smooth upgrades so as to meet future demand for access at 100Mbps and even 1Gbps. To this end, based on extensive research and studies, it chose the FTTx model and type of equipment that best suited its needs and would help achieve its goal quickly.

Savings on investment through hybrid deployment model Various deployment models were available, including FT TH, FT TC and FT TB. After conducting a TCO analysis, Romtelecom decided that reusing the existing infrastructure and selecting an efficient FTTx model would be the best way of

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Winners

Through mature VDSL2 technology, FTTB could provide 30 to 50Mbps bandwidth within 300 meters. Obviously the suitable solution to cover most users, it was chosen by Romtelecom as the primary model.

saving on investment.

As Romtelecom found out, FTTB could take full advantage of subscriber line resources to eliminate difficulty in FTTH. Through mature VDSL2 technology, FTTB could provide 30 to 50Mbps bandwidth within 300 meters, to address bandwidth insufficiency and failure of massive IPTV service deployment with FTTC. Obviously the suitable solution to cover most users, it was chosen by Romtelecom as the primary model. In newly-built areas and upscale neighborhoods where optical fiber resources were already available, FTTH was deployed to provide 100Mbps bandwidth.

With this hybrid model, Romtelecom could make the best of its subscriber line resources, leverage its own advantages, and cut network investments.

Also, it could provide a platform for massive IPTV service deployment, greatly improving the competitiveness of Romtelecom as an integrated service provider.

Second, Romtelecom made a strategic decision to select a GPON-based FTTB solution.

Compared with the traditional FTTB solution based on Ethernet technology, a GPON network utilizes passive optical splitters for FT TB equipment convergence, eliminating the need to deploy aggregation switches. That not only reduces network layers, but dramatically cuts the cost for cable access of network element nodes and converged optical ports as well. Meanwhile, a passive ODN network does not require power supply, and sites are easy to select, which reduces

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the deployment difficulty and failure rate.

Moreover, FTTH and FTTB can share one ODN network, further saving on investment.

Network deployment speeds up Though realizing that speed was key to acquiring broadband subscribers and gaining a competitive edge, Romtelecom found that deploying a network quickly was no easy task. To provide highspeed bandwidth, a DSL provider must shorten the distance from the access equipment to user terminals. Therefore, with the FTTB model, access equipment is put in buildings as close to users as possible. Installing new MDU equipment requires approval from the owner committee. As a result, site acquisition is the biggest challenge in FTTB deployment, while it is the prerequisite to quick network deployment.

Romtelecom noticed that a cable connection box in the building could be the ideal site. In fact, in the traditional FTTB solution, “cabinet + MDU equipment” was too big to fit into the box, and noise from the cooling fans might cause complaints from the owners, often resulting in a halt to FTTB deployment. To avoid these problems and realize fast deployment, Romtelecom selected the new model of Huawei’s integrated MDU equipment.

The integrated MDU is of a size that is only half of the traditional MDU. It is so light that it can be mounted by a single person, reducing manpower by

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more than 50%. In light of cable connection boxes of different shapes, Romtelecom ordered a variety of customized MDUs, including the compact doorhanging type and the integrated wall-hanging type for installation inside the existing cable connection box or by its side. Featuring fully enclosed design and using natural cooling, the new equipment has made zero noise and caused no interference to users around.

Moreover, FTTB can split one DSLAM at the central office into dozens and even hundreds of scattered FTTB MDUs, leading to a sharp rise in the workload of software testing. With its available human resources, Romtelecom could not cope.

The operator had to address the issue of local software commissioning before it could achieve quick service delivery. For this reason, it chose Huawei’s FTTB automatic service provisioning solution to eliminate the need for local software commissioning on MDUs. After installing hardware through the automatic ser vice provisioning solution, Romtelecom could have its MDUs automatically registered and certified with the network administrator, automatically upgrade, configure and download software. And it could even automatically complete service acceptance remotely, dramatically saving on the time for installation. Simply by observing the equipment indicator, its onsite hardware installation engineer could find out whether equipment commissioning was completed, eliminating the need for any software commissioning engineer.

Capturing high-end broadband market With an efficient FTTx solution, Romtelecom has made fast headway in its broadband network deployment. As of 2010, Romtelecom had deployed an FTTB VDSL2 network covering 400,000 subscribers, well outpacing its competitors.

With more than 100,000 broadband subscribers, it grabbed a big chunk of the high-end broadband market.

By taking full advantage of its available resources and selecting the GPON+FTTB model, Romtelecom successfully opened the door to ultrabroadband. The operator did not stop there. It has mapped out a more detailed plan for the protection of existing investments and future evolution.

Romtelecom has planned, in the next three to five years, provide 100Mbps broadband access by upgrading its network to 10GPON+Vectoring DSL, and after that, to provide 1Gbps access by integrating NG PON with new DSL technologies like G.FAST. Wi t h re g a rd t o F T T x , t h e o p e r a t o r h a s envisaged increasing access bandwidth by five to ten times. Meanwhile, by investing heavily in reusable infrastructure like sites, ODNs, and copper wires, it has made a one-off investment to support long-term evolution for its network and ensure its success in the broadband market over the next five to eight years.

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Winners

Qatar Telecom One step higher with fiber The national broadband project, implemented by Qatar Telecom (Qtel), is a critical step for Qatar’s development and its national vision of building an advanced connected society by 2030. The project is also aimed at helping Qtel become a member of the world’s top 20 operators.

By Wang Xiaoliang

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Editor: Pan Tao pantao@huawei.com

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n December 2010, Qatar was awarded the right to host the 2022 FIFA World Cup, squarely placing the Middle Eastern country in the spotlight. With a modest but growing population of 1.7 million, Qatar has never stopped driving for success in every field it enters. With abundant oil and gas resources, Qatar ranks as the highest GDP per capita nation in the world.

A former host of the Asian Games, the country is known to the world for its unparalleled National Convention Center, top tier education facilities, sports centers, global broadcasting giant Al Jazeera, Qatar Airways and more.

Qatar’s National Vision 2030 outlines the framework to deliver an advanced society. Besides the basic infrastructure such as roads and buildings, telecom infrastructure will play a key part in this development. In March 2011, the Supreme Council of Information and Communication Technology (ictQATAR) announced a fiveyear national broadband strategy, to deliver a nationwide high-speed, accessible broadband network.

Conquering “the last mile” In 2009 the detailed planning and implementation

of Qtel’s national broadband network commenced to being a new generation of exciting services to residents and businesses in Qatar. This network will cover 140,000 users within 2 years, a very ambitious and exciting challenge meaning that a majority of Qtel fixed-line customers will be served by fiber by 2012.

Qtel began researching many fiber based broadband network candidate technologies like P2P, GPON, 10G GPON, WDM PON, and xDSL to accelerate its copper-based access network for some time. After considering factors like the technology maturity, cost, network longevity, solutions features and time to market, Qtel selected the GPON-based FTTx solution as the foundation for its national broadband network.

GPON is able to satisfy the need for access speeds of 100Mbps+ per connection, ensure better return on investment, has been readily and widely available, and can be deployed in current duct infrastructure, hence it is able to be deployed quickly as the last-mile optical access. To support in the deployment of these very demanding plans, Qtel selected Huawei as the prime vendor.

The project broke ground in January 2011 and the first cutover was completed in July 2011.

The first phase of the Qtel’s national broadband project will connect 140,000 users in Doha and

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Winners

When planning the national broadband network, Qtel specifies an average broadband speed of 100Mbps per connection targeted to meet the future national vision and support the nation’s development.

surrounding areas. The project aims to cover the entire population of Qatar within four years. Once complete, Qtel will be the first operator in the world that has successfully delivered an FTTH network to replace its entire legacy copper network.

This project is also the largest infrastructure investment in Qtel’s history. As such Qtel has stated that this investment will provide connections to customers at speeds of up to 100Mbps. In addition, the investment means that Qtel will offer richer media services like high-definition TV and video-on-demand (VOD) with other enhancements. Moreover, the network will provide great support for the eHealth and eEducation programs, contributing to economic and social development.

Phasing out ADSL2+ According to Qatar’s National Development Strategy 2011-2016, the improvement of economic and living conditions can not happen without the development of information and communications.

In 2020, Qatar is expected to build its eHealth and eEducation systems, maintain its leadership as a financial hub in the Middle East, while maintaining its strong economic growth. All these need the support of a robust, next-generation information and communications network.

When planning the national broadband network, Qtel specifies an average broadband speed of 100Mbps per connection targeted to meet the future national vision and support the nation’s development. The GPON-based network

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will replace the copper-based ADSL2+ network, enhancing the speed from 5-10Mbps to 100Mbps.

To achieve this, Qtel has developed a unified plan for the access, core and transport layers, entirely replacing existing networks.

Most residential buildings in Qatar are large villas; each house has five to seven bedrooms.

To satisfy users’ bandwidth needs, it is necessary to support multiple Gigabit Ethernet (GE) connections and often more than one line for voice telephony. For that purpose, Huawei customized the optical network terminals (ONTs) with four GE interfaces and up to four POTS interfaces.

This new design greatly facilitated the launch of residential services and could handle even the most discerning home user.

For business users, Qtel will deploy Fiber to the Building/Curb (FTTB/C) and leverage its copper resources to provide optimal VDSL2 services.

Legacy services such as integrated services digital network (ISDN) and primary rate interface (PRI) which use PSTN will be migrated to the new FTTx and next-generation network (NGN), and the old PSTN will be phased out.

In terms of operation and maintenance, Huawei N2510 diagnosis system can help Qtel locate faults quickly based on alarm information. The N2510 can narrow down a failure point location in fiber to within six meters, significantly enhancing the troubleshooting efficiency.

Preparing for new growth As Qtel’s partner, Huawei provided end-to-end

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access, transport and IPTV systems to the project.

The two parties set up an expert team in September 2010 to begin network planning, site survey and installation. In July 2011, Phase One of Qtel’s national broadband project was successfully cut over and services were launched. The end of 2011 is expected to see about 25,000 homes connected with high-speed broadband, and each home can support up to three to four IPTV services simultaneously. In addition, ONTs can enable the sharing of multimedia content at home.

Based on a deep understanding of services and the network structure, Qtel will deploy FTTx and provide high-speed Internet access to areas like Pearl-Qatar, Wukair, multiple residential housing complexes and West Bay business and residential towers. The operator has also tailored a one-stop solution for small and medium enterprises (SMEs), offering a unified service for voice, data, and wireless access.

The launch of mobile broadband network is

providing users with better services and higher bandwidth. Enterprises can also enhance their data exchange efficiency by using the network; while Qtel has strengthened its brand image and is one step closer to becoming one of the world’s top 20 operators. The network also provides high-speed access to universities and research institutions in the country, enhancing the academic exchange and helping to realize the national vision.

The national broadband network will make an important contribution to the growth and development of the knowledge economy and the country as a whole. The network will contribute not only to individuals and enterprises with enhanced broadband speed, but also to the growth of knowledge economy. Once the project is completed, homes and enterprises can access the high-speed broadband services. In addition, the expanded network capacity will also bring a variety of new services, contributing to the nation’s education, entertainment, and applications.

The national broadband network will make an important contribution to the growth and development of the knowledge economy and the country as a whole.

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Winners

Movistar Chile Unleashing the potential of copper

Movistar Chile has blazed a trail of innovative growth with strong momentum by leveraging its existing network resources for maximized bandwidth capabilities, and providing subscribers with richer ultra-broadband services.

By Wang Yongbo & Wang Erhu

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Editor: Xu Ping x.ping@huawei.com

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Dual pressure necessitates changes

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subsidiary of Telefonica, Movistar Chile is the largest full-service operator in Chile’s telecom market, with 3,000,000 landline phone subscribers so far. Thanks to its high-quality communications services and wide market coverage, it has become a well-known brand in the market. Of the services that it provides – broadband, Pay TV, local/longdistance/international calling, data transfer and VAS, it boasts the No.1 position in the broadband segment with a 46% market share.

Nonetheless, to grow further, it faced great p re s s u re f ro m t w o a s p e c t s . C h i l e b o a s t s a developed economy, with GDP reaching USD169 billion in 2008, or GDP per capita of more than USD10,000, and has since then kept the No.1 position in Latin America. Moreover, its young population, with an average age of only 31, has a curiosity for new things and a strong demand for Internet surfing. This has fueled the surging demand for broadband in Chile. Instead of just browsing and shopping online, people in Chile have been seeking richer, video-based highbroadband services, such as pay-per-view, personal video recorders, and parental control.

Movistar Chile’s existing copper cable access network had been in use for more than two decades and a lot of its equipment had become obsolete, making it difficult to maintain the network and satisfy the need for capacity expansion even as subscribers’ demand for bandwidth continued to grow increasingly stronger. This posed serious threats to Movistar’s brand and future growth.

On the other hand, Movistar Chile was also facing pressure from local cable operators, which had been nibbling away at the operator’s broadband market share. Leveraging their advantages in the TV sector, cable operators were bundling their TV services with broadband Internet services via their existing Hybrid Fiber-Coaxial (HFC) network.

Seeking the best solution To tackle the dual pressure from customer needs and competition, Movistar moved quickly in 2010, by first consolidating its fixed and mobile networks.

It also worked on consolidated brands, making Pay

TV services a priority in order to take the fight to local cable operators. As video services need higher bandwidth, to allow more users to access highquality video services, renovating the network was a must. With the slogan of “Broadband Speedup”, the operator set itself the goal of first increasing speeds for 100,000 subscribers, and then carrying it out across its network.

After evaluating the options of FTTH and FTTC for its network speed up project, Movistar finally decided on the latter one for its advantages in return on investment (ROI) and time to market. Given the operator’s massive copper cable resources, shortening the copper cable line between end users and broadband equipment within 300 meters, can effectively boost end users’ bandwidth up to 50Mbps, which is more than enough to carry multi-play services including video, fully meeting the requirements of digital homes in the future.

Therefore, equipment that used to be placed in center offices needed to be moved closer to customers. As Movistar had chosen to go with outdoor cabinets, several obstacles lay in its path.

First, it was impossible to receive permission from municipal governments to place new outdoor cabinets in large cities. Second, if such cabinets were placed underground instead, the cost would be too high and maintenance would become more difficult. Third, guaranteeing a stable power supply was another issue.

Movistar decided to work with Huawei on the

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Winners

With the help of an ultra-bandwidth and reliable network, Movistar’s multi-play services were accepted enthusiastically in the market, giving further boost to the operator’s brand image.

access solution and perform a careful analysis of the situation, supported by Huawei’s global experience in the field of FTTC applications. The joint team found out that the operator had more than 50,000 copper street boxes on its existing network, including 25,000 street boxes alone in Santiago, the capital of Chile, and that the locations of those boxes had been approved by local governments.

Huawei proposed to utilize these locations to place outdoor cabinets. Its high-density Mini Digital Subscriber Line Access Multiplexer (MiniDSLAM) equipment could be placed inside outdoor cabinets; as for power supply, the remote power supply technology utilizing copper cables could fully meet the demand. This TOP BOX Solution with remote power supply proposed by Huawei quickly won the approval of the senior management at the operator.

Empirically proven performance Outdoor cabinets need to endure harsh natural conditions including high temperatures/humidity, low temperatures, salt mist, and dust so that the equipment inside can operate normally. As outdoor cabinet design and manufacturing have high requirements, Movistar asked Huawei to conduct field trial tests to see how the good proposal works in a real situation.

In October 2010, rounds of stress tests were conducted on Huawei outdoor cabinets and MiniDSLAM in a hot desert in northern Chile, including tests involving heat dissipation at high temperatures, full load running, remote power supply, corrosion, and waterproofing.

Two months of efforts by the joint team reaped fruits, and the operator was very satisfied with the result. It quickly announced in public that it would begin providing home users with richer ultra-

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broadband services. Learning about Movistar’s plan for network renovation, a rival quickly stepped up provisioning of new services with a view to get the cream of the newly added user market before the former finished its renovation. Time was ticking.

With Movistar’s commercial success at stake, Huawei quickly strengthened its delivery team and set up a dedicated war room with Movistar.

Tackling challenges one after another, including cabinet customization and integration of external materials, as well as surveys on a large number of outdoor sites, Huawei successfully delivered the highvolume outdoor stations in strict accordance with the operator’s requirements for quality and time schedule.

The head of the Movistar team for the project noted that it was only due to the “unbelievable” cooperation between the two sides that delivery could be made within such a short period of time.

At a press conference, the operator mentioned Huawei’s role more than once and expressed its intention to replicate the success of these outdoor cabinets across Latin America.

By the end of second quarter of 2011, Movistar had successfully deployed 900 TOP BOXes, fully reversing the previous situation. Its number of broadband subscribers increased by 200,000 and market share bounced back to an even higher level than the previous year. With the help of an ultra-bandwidth and reliable network, its multiplay services were accepted enthusiastically in the market, giving further boost to the operator’s brand image. With such excellent market performance, Movistar set the goal of increasing its investment and deploying more than 3,000 TOP BOXes in the next three years and reproducing its success across Chile, covering major cities, regions and some suburbs. The operator’s goal is to offer all the people of Chile access to its rich, excellent services in the foreseeable future.

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Telenor Norway Going north, takes LTE to the Arctic

Located halfway between mainland Norway and the North Pole, the Svalbard archipelago features the world’s northernmost town in Longyearbyen. In March 2011, Norwegian operator Telenor decided to mark the centenary of its presence in the region by deploying the northernmost LTE network in the world there. Despite the great distance from the mainland and extreme Arctic conditions, Huawei was able to assist Telenor in deploying LTE, using the world-leading SingleRAN solution, in Svalbard within a matter of weeks.

By Ranajit S. Dam

Editor: Gao Xianrui sally@huawei.com

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Winners

With the successful deployment of LTE, the residents and tourists in the world’s northernmost town will benefit from a superb mobile broadband experience.

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ess than 3,000 live on the Svalbard islands, a remote, freezing cold archipelago located at 74° to 81° latitude that is popular among tourists and scientific researchers for its unique place on the world map. Svalbard is home to the Svalbard Global Seed Vault, a secure seedbank that preserves a wide variety of plant seeds in the case of losses of seeds in genebanks or large-scale regional or global crises. Meanwhile, Svalbard attracts a steady stream of tourists, as it offers Arctic nature at its rawest and most powerful. Featuring untouched glaciers and craggy mountains, the islands also boast animals like polar bears and reindeer, and birds like Arctic terns and puffins. It was to cater to these visitors and deliver to Svalbard the LTE revolution that is currently sweeping across Europe that Norwegian operator Telenor decided to deploy its LTE network there, as a way of marking 100 years of the operator’s presence in the area.

Harsh climate poses challenges In 1911, Telenor set up the first telegraph tower on Svalbard. In March 2011, a century after that event, Telenor decided to set up an LTE network in the town of Longyearbyen, Svalbard’s administrative center with a population of about 2,000.

Huawei, as Telenor’s partner in carrying out this project, found that the location and extreme climate of Svalbard posed a number of challenges.

The biggest was the weather condition. Located

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inside the Arctic Circle, Svalbard experiences both polar night and midnight sun, with temperature dropping to as low as -46°C. The worry was whether the equipment would be able to withstand the extreme climate.

For one, the archipelago is located some 2000 kilometers from mainland Norway, which is where the core network is located. Setting up the radio access equipment on Svalbard risked causing longer LTE transmission latency time. The remote location also posed difficulty in transporting people and equipment from the Norwegian mainland.

Finally, the city of Longyearbyen had some 3,000 bears, posing threats to the installation process.

Thorough preparations In 1996, GSM first came to Longyearbyen, and in 2011, Telenor aimed to launch LTE with an opening ceremony at the end of May. To tackle the challenge of longer LTE transmission latency time, Huawei reconfigured the optimized parameter, used a different algorithm, and also used advanced equipment that together kept the transmission latency time within an acceptable range.

Meanwhile, it utilized a variety of transportation modes, including helicopters, forklift trucks, mini trucks and snowmobiles to get people and resources to the sites. Shotguns were kept on standby in case of bear attacks, while equipment that could operate in extremely low temperatures was used.

Within a month of receiving the request for assistance at the end of March, Huawei was able to complete the swap of all five GSM/UMTS/LTE

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sites on Svalbard, and also build a new one. In early May 2011, a network analysis was carried out after the completion of the swap, and an optimization plan was drafted in order to prepare for an LTE demo later that month.

Huawei then carried out a mirror test featuring 14 users at the Technical LTE Pilot in the city of Lillestrøm in Norway. By the third week of May, nine installation errors were found and fixed, while several driving tests were performed. After the GSM/UMTS/LTE and LTE were optimized, suggestion reports were sent to Telenor. Tests carried out after network optimization found downlink speed of 100Mbps at Telenor in Svalbard, with the download peak of 145Mbps being experienced at Longyearbyen’s Radisson Hotel.

Also, a stable multiuser performance was witnessed at the Funken Hotel. On May 26, the Huawei team flew to Svalbard to provide on-site event support. All equipment was inspected for a final time, and rehearsals were repeatedly performed to ensure all details were covered.

On May 28, the day before the event, checks were made to ensure that eNodeB was fully functional, the transmission was in place, the server was up and running, the demo plan is finalized, the dongles had been individually examined and support personnel were on standby.

LTE goes north On May 29 and 30, the opening ceremony took place, featuring an LTE VOD demo, with Telenor’s top executives – including the Group CEO and

Chairman – in attendance. A variety of Norwegian media organizations reported on the launch of LTE in the Arctic region, the world’s northernmost LTE site at 78°13′N. With download speeds of 100Mbps and above, the project showed Huawei’s core values – keeping the customer in focus, and being trustworthy.

Huawei’s work on the LTE project, which will be commercially launched on March 1, 2012, was lauded by Telenor. “We have upgraded base stations here, and now we want to make a closed test in Longyearbyen,” said Bjørn Amundsen, the operator’s Coverage Director. “We are interested to see how the group of chosen users who already got fiber connections with good capacity make use of this mobile broadband.”

Harald Norvik, Board Chairman of the Telenor Group noted that the new service would benefit the locals greatly. “Svalbard has changed radically in the past years,” he said, “and we have given the locals a better means of communication. Now we have taken a step further and open the LTE network.”

Meanwhile, Berit Kjøll, Executive Vice President of Huawei Norway said the project provided more evidence of the durability of Huawei’s equipment.

“The accomplishment of this LTE launch in the Svalbard archipelago shows that our wireless equipment is capable of optimal performance in even the harshest natural conditions,” he added.

With the successful deployment of LTE, the residents and tourists in the world’s northernmost town will benefit from a superb mobile broadband experience, bringing Svalbard up to speed with much of Europe.

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Winners

China Mobile

Forerunner in synergized network development To alleviate pressure from continuous capacity expansion of the macro network, operators have turned to building one WLAN network after another. How should operators synergize the development of multiple networks that coexist? China Mobile Shandong provides the answer.

By Li Junfeng

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Editor: Chen Yuhong chyhong@huawei.com

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hina Mobile is one of China’s and the world’s leading operators, with the largest number of subscribers globally.

In the GSM era, its stable network, excellent voice service and superb customer service gave it the edge over its competition, lending a strong momentum to it in the GPRS/EDGE area. However in the 3G era, due to limitations of the whole industry chain for the TD-SCDMA network which it operates, it had not been able to exploit its advantages in network, branding and management prowess.

This posed great challenges to the China Mobile Group and its subsidiaries at the provincial level, and raised questions as to how it could break out of the limitations, and continue lead in mobile broadband.

Synergized development of four networks To tap into the great potential of the mobile broadband market, operators used to promote 3G network cards to acquire subscribers quickly. While giving a huge boost to its data traffic, this approach failed to raise China Mobile’s revenue. According to Wang Jianzhou, Chairman of the Board of Directors for China Mobile, it was not enough to meet the increasingly growing user demand for data traffic via the existing GSM and TD-SCDMA networks.

One of the feasible solutions to this was WLAN, an effective measure to offload wireless data traffic.

In 2010, the China Mobile Group decided on its strategy of supporting future network growth via the synchronized development of GSM, TDSCDMA, TD-LTE and WLAN networks. It has

been a common goal among the China Mobile Group and its provincial subsidiaries to leverage WLAN’s advantages in offloading big data traffic, not to mention its low cost, easy deployment and high speed, in order to provide higher-speed network experience for subscribers.

China Mobile Shandong is the vanguard of this strategy. As one of China’s developed eastern provinces, Shandong has seen its economy growing fast and user demand for data services becoming increasingly diversified and stronger. Given its high cost and lengthy construction cycle, it was obviously not practical for the 3G network alone to meet such strong demand. WLAN, as a good supplement, could effectively offload data traffic from GSM and TD-SCDMA networks to alleviate network pressure and provide high-bandwidth services for subscribers.

The two challenges of WLAN As early as 2008, China Mobile had deployed Wi-Fi in some important cities. Yet, it still needed to work out practical approaches to give full play to WLAN and maximize its resource utilization.

How to leverage advantage in subscriber resource How to leverage China Mobile’s huge subscriber b a s e t o t h e b e n e f i t o f i t s W L A N n e t w o rk development has been an area of concern among China Mobile’s subsidiaries. China Mobile Shandong has a huge subscriber base using 3G network cards, with good network stickiness. This

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Winners

With Huawei’s UIM based on SingleSDB platform, China Mobile Shandong has realized integration of its GSM, TD-SCDMA and WLAN networks, which effectively diverts data traffic, and alleviates pressure on the network. would be a perfectly good starting point for WLAN network, if it could attract such high-quality subscribers to the WLAN network, which would not only alleviate 3G network pressure, but also make room for potential 3G network subscribers.

This was the reason why China Mobile Shandong adopted the strategy of utilizing its existing 3G network card subscriber base to develop WLAN as a supplement to 3G.

How to maximize network resource utilization Back in 2008, China Mobile launched its “Wireless City” strategy and framed plans to develop WLAN subscribers independently. Yet, it failed to attract enough users and led to low network utilization, as to subscribe to WLAN, people needed to apply for new accounts and go through traditional portal authentication. They also could not switch smoothly between GSM/TDSCDMA and WLAN. Meanwhile, GSM/TD-SCDMA networks were getting increasingly overloaded, with frequent occurrence of congestion in hotspots. How to divert subscribers to WLAN network had become a big headache to China Mobile.

China Mobile Shandong realized that the inconvenient traditional way of accessing Wi-Fi and users’ ingrained habits deterred them from initiating the transfer. Only by accommodating the users’ habits and allowing them to transfer between TD-SCDMA and WLAN without any feeling of inconvenience and obstacle, could it spur the takeup of WLAN among users and divert traffic away from GSM/TD-SCDMA to WLAN. Allowing

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users to access its network in the simplest way became a top priority for China Mobile Shandong.

Unified authentication comes to the rescue In 2010, China Mobile Shandong conducted rounds of competitive tests on numerous vendors’ solution offerings. Huawei SingleSDB’s UIM solution came out ahead in the race and was selected

by China Mobile Shandong to realize unified authentication for TD-SCDMA and WLAN, so that users could experience both ubiquitous TD-SCDMA network services and high-speed Wi-Fi services.

TD-SCDMA + Wi-Fi Ta r g e t i n g i t s e x i s t i n g 3 G n e t w o r k c a rd subscribers, China Mobile Shandong launched its TD + Wi-Fi package based upon Huawei’s UIM solution. With this package, subscribers need only upgrade its client-end software to access high-speed WLAN in Wi-Fi hotspots via their existing 3G network cards.

In Wi-Fi covered areas, WLAN network will be the automatic choice, instead of TD-SCDMA, giving subscribers higher speeds. For areas outside Wi-Fi coverage, the macro network, be it GSM or TD-SCDMA, will be the automatic choice, providing users with good coverage and continuous network services.

Using this automatic network transfer, WLAN perfectly complements high-coverage GSM/TDSCDMA with its high speed, realizing the two goals of offloading traffic and improving network quality.

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Seamless authentication

diversion is taking effect.

Compared to the old package, China Mobile Shandong’s new package offers additional WiFi services at no extra cost, removing the tariff obstacle for subscribers.

Secondly, while accessing the WLAN network, subscribers need not go through the inconvenient portal authentication process by inputting user name and password. Instead, the UIM solution enables SIM authentication for subscribers and they need not be involved at all in the process, the same as using the 3G network. They can also access services in PS areas while they stay with WLAN, just like before.

The only difference in user experience is that they can feel the higher network speed. Based on this seamless transfer, China Mobile Shandong can now divert 3G subscribers to WLAN and increase its WLAN network utilization, boosting its confidence in developing wireless broadband.

Prelude to synergized network development

Growing effect in traffic diversion China Mobile has a very solid foundation for massive deployment of Wi-Fi hotspots, as it has well-established indoor coverage for its GSM/TDSCDMA networks all over the country, and most of its resources can be shared by WLAN. This is why China Mobile Shandong, after success with its pilots on UIM, was highly optimistic about the next step. Realizing that most data services were utilized indoors, the operator deployed Wi-Fi hotspots in the province, basically realizing full coverage in school campuses, office buildings, residential buildings and business hubs. Wi-Fi hotspots are becoming the major access points for data services and data traffic

With Huawei’s UIM based on SingleSDB platform, China Mobile Shandong has realized integration of its GSM, TD-SCDMA and WLAN networks, which effectively diverts data traffic, alleviates pressure on the network and provides high-speed data services to subscribers, giving a boost to its long-term network development.

In December 2010, at the fourth Mobile Internet International Seminar, Huang Xiaoqing, President of China Mobile Research Institute said: “China Mobile must offer a network of multiple accesses. That is why we have long been working on the integration of GSM, TD-SCDMA, TD-LTE and WLAN. With multiple network choices, subscribers could utilize the mainstream GSM and TD-SCDMA networks for voice services and LTE or WLAN for data. This not only meets user experiences demand, but also enables effective alternation of mobile communications resources and network.” As we can see, the China Mobile Group has set WLAN at a strategically equal position with GSM, TD-SCDMA and TD-LTE. Unified authentication and network integration will pave the way for the strategic initiative of synergized network development.

Huawei’s UIM, with its data integration edge, supports smooth evolution to SingleSDB. It lays a solid foundation for the integration development of subscriber data and thus for the synergized development of GSM, TD-SCDMA, TD-LTE and WLAN for China Mobile.

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Winners

China Telecom Road to IPTV success in Shanghai

As of March 2011, China Telecom Shanghai had four million broadband subscribers, and a third of these had opted for the IPTV service. The operator’s triple-play, any-screen service lineup already exceeds the offerings of the Internet content providers, and it appears that the best is yet to come.

By Steven Hawley

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Editor: Ranajit S. Dam ranajit.dam@huawei.com

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hina Telecom Shanghai (Shanghai Telecom) is a subsidiary company o f t h e C h i n a Te l e c o m G r o u p .

China Telecom is the largest fixedline telecommunications and broadband service operator in the world. It has operated a 3G mobile service since 2008, and become the largest CDMA mobile network operator in the world.

In Shanghai, the operator is currently building a high-performance Metro Optical Network (MONet), which includes its metropolitan area network (MAN), its core network, and optical Fiber-to-the-Building (FTTB) and Fiber-tothe-Home (FTTH) access. By the end of 2010, MONet’s optical access network had already covered more than 1.5 million users. Shanghai Telecom’s goal is to cover 3 million users by the end of 2011.

Shanghai has the highest number of broadband Internet access and IPTV subscribers of all the cities in China, and the most IPTV subscribers of any city in the world. About one third of Shanghai Telecom’s four million broadband subscribers take IPTV service, which reached 1.32 million subscribers as of March of 2011. Shanghai Telecom bundles IPTV, broadband Internet access and telephone services together into an offering called My E-Home.

Shanghai Telecom’s video services today The video operation center of Shanghai Telecom has two broad purposes. First, it provides a platform for content convergence, including content from leading commercial content suppliers, from TV stations, video content that is produced in-house, and content from consumers – and to deliver this range of content and services to multiple screens over IP: to TVs, PCs, mobile devices, and other multimedia terminals. Second, it is a platform for service integration, including traditional TV, Internet video, mobile phone video, value-added consumer multimedia applications.

The IPTV service is comprised of more than 100 channels of live standard-definition TV, and eleven HD channels, which are delivered to a standardized in-home set-top box. The HD channels went into service in March of 2010. A “TV replay” service allows subscribers to play any program up to 72 hours after it is broadcast, with “trick play” features that allow users to pause, fast-forward or rewind up to 60 minutes, at any time. Shanghai Telecom also has a large library of video-on-demand (VOD) with more than 13,000 hours of video, and audio content. Timeshifted TV and TV Replay are basic features of the

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Winners

The challenges led Shanghai Telecom to the decision to replace its initial IPTV delivery system. It also placed a high priority on VAS business models, QoS and QoE, and the balance between the level of investment and the end results.

service, and are enjoyed by all subscribers.

In addition to these traditional live TV and content-on-demand features, Shanghai Telecom also delivers more than 35 different value-added informational services to the TV. These services include a news center, financial information, educational content, health, weather, shopping and a TV magazine. In addition, there are nearly 30 different entertainment items, including karaoke and a range of TV-based casual games, including chess.

Shanghai Telecom has defined four different types of TV terminal devices, including basic standard-definition set-tops, an HD set-top, and two different home media center devices that serve as gateways that consumers can use to access personal digital media content on the TV and on other screens. In addition to the TV, these screens include mobile devices, PCs and a fourth screen called the MPad. Shanghai Telecom’s mobile video offering includes more than 35 channels of live TV programming, 16 channels of video replay content, and more than 70,000 on-demand video items.

Content is also made available for download to the device. Content providers include Shanghai Media Group (SMG), CCTV, CNLive, CNR, WASU, CRI and Xinhua.

Technical and business challenges 41

Shanghai Telecom’s IPTV service started strong in 2005, reaching 300,000 subscribers in the first two years. However, by 2007, the rate of subscriber growth began to fall short of expectations. Also, there were technical and business challenges in four different areas.

The first problem area was the user experience.

Network issues were causing IPTV channel change time to be as high as 2 seconds, which was not acceptable to consumers.

Another area was customer premises equipment (CPE). During the early years, there was only one type of set-top box, which was expensive and was not meeting Shanghai Telecom’s cost goals.

The third problem area was the integration of the overall platform, which was difficult because each vendor had its own approach. Each of China Telecom’s regional units would work with vendors of their own choice: different regions and telcos used different vendors.

The fourth area was content delivery, because there was insufficient access network bandwidth even for standard-definition TV, let alone HD; or any ability to provide other multimedia content to consumers.

These early challenges led Shanghai Telecom to the decision to replace its initial IPTV delivery system. In addition, Shanghai Telecom placed a high priority on having viable business models for value-added services, on improvements to quality of service (QoS) and quality of experience (QoE), to ensure that there is a balance between the level

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of investment and the end results.

IPTV 2.0 initiative To address the overall platform issues, in June of 2007, Shanghai Telecom partnered with Huawei and other technology vendors, to define Shanghai Telecom’s IPTV 2.0 initiative, and announced in March of 2008. Shanghai Telecom set forth four key goals for the IPTV 2.0 specification: to provide a unified and standardized interface between IPTV set-top boxes and the IPTV platform; to provide a unified authentication system; to unify the service provider interface to services; to provide a unified approach to IPTV multicast delivery.

The IPTV 2.0 specification was designed to create an open multi-vendor platform, upon which Shanghai Telecom could build its IPTV deployment, and then introduce additional valueadded services over short time. The resulting system uses a standardized architecture and open interfaces to address all four of the identified challenge areas.

To address the quality of experience, Shanghai Telecom has worked closely with Huawei to achieve fast channel change and low-cost application-layer retransmission. Also, the bandwidth now available for standard-definition TV over copper has been increased from a level of 1.8Mbps in 2006 to 3.2Mbps today. This gives Shanghai Telecom an advantage over other broadband service providers, because the majority of broadband competitors

have access speeds below 2Mbps.

To address the content issues, Shanghai Telecom and Huawei have worked closely with major content suppliers. For example, officials of Shanghai Media Group (SMG), a provider of a wide range of programming that is carried

by China Telecom’s IPTV service, indicate that Huawei has been very helpful in facilitating faster access, through FTTB and FTTH access. In Shanghai, Guangdong province and elsewhere, access speeds are above 20Mbps, which makes it easy for BesTV to offer HD programming and a high-resolution user interface in those regions.

Currently, Shanghai Telecom can use set-top boxes from six different suppliers. In Shanghai, the IPTV 2.0 specification allowed the service provider to use any generic set-top box that complied with the standard. Before the IPTV 2.0 specification was put in place, Shanghai Telecom could use only set-top boxes from certain vendors. The IPTV 2.0 standard has also helped to reduce the cost of settop boxes significantly.

The IPTV 2.0 platform has also enabled Shanghai Telecom to deploy multi-screen TV, which is a service concept that allows the same household to consume video services on different screens. This has become not only a competitive differentiator for Shanghai Telecom but is also a competitive imperative because of the changing demographics in Shanghai.

Now, Shanghai Telecom has gone far beyond offering basic TV and EPG services, via a basic set-

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The IPTV 2.0 initiative quickly yielded significant results.

From December 2007 to December 2008, the number of IPTV subscribers increased from 227,000 to 745,000, a growth of more than 500,000 subscribers in just its first year.

top box. Cloud-based delivery is being put in place to serve a range of interactive value-added services to intelligent multimedia consumer devices that include not just TVs and PCs, but also, mobile devices and a specialized in-home multimedia terminal called the MPad. The IPTV 2.0 initiative quickly yielded significant results. During the 12 month period from December 2007 through December 2008, the number of IPTV subscribers increased from 227,000 to 745,000, a growth of more than 500,000 subscribers in just its first year.

Emerging trends and future demands To help overcome potential challenges relating to multi-screen delivery, one of Shanghai Telecom’s focus areas will be to increase the efficiency of content delivery over CDN. Huawei offers advanced cloud-based solutions, which will help improve the efficiency of Shanghai Telecom IPTV services that are based on storage.

This will enable Shanghai Telecom to put more of the intelligence in the network cloud, and deliver the right format of video to each type of consumer device.

Shanghai Telecom’s standard-based service delivery and management platform is open, and

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is designed for convergence. Its unified content management system ensures that the right content is delivered to the right device, with high quality (QoS, QoE). The CDN has open interfaces for commercial and individual providers that contribute commercial or personal content. There are also standardized portal interfaces for the web, for WAP, for client portals and for TV EPGs. Going beyond multi-screen services, Shanghai Telecom sees some additional trends in several key areas: Anywhere-anytime deliver y: including the demand for video by mobile users on an intermittent basis; Increased interactivity: including the efficient delivery of live TV and VOD content, while the demand for web browsing, online games and education, and social interaction is on the increase; A continuing quest for high quality: including increased demand and availability for HD content, 3D video, high fidelity audio and console games; Personalization: including user-generated content and the use of search, ratings by subscribers, blogging, commenting, and group collaboration.

New ser vice features include interactive overlays on top of video, multi-screen services, media sharing, and interactive media. Shanghai Telecom is also beginning to talk with social media companies in China to add social features to its TV offering. A 3D IPTV demonstration has been

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Huawei’s primary contribution to our IPTV is the IPTV 2.0 Standard system commercially used in Shanghai. We have had a very good partnership in the design and deployment of these systems.

under development in Shanghai Telecom’s labs, and is ready for demonstration.

Huawei as a strategic partner Because of its active participation in these areas, Huawei soon earned a leadership role in the Shanghai Telecom IPTV 2.0 initiative. This success led Shanghai Telecom to ask Huawei to deploy in the main districts of Shanghai, including Pudong, Nanhui and Baoshan.

Although Huawei was late to join the project, the improvements came quickly. Beginning in 2008, Huawei was given a strategic role for several key areas at Shanghai Telecom, on an ongoing basis, and has been given exclusive responsibility for Shanghai Telecom’s unified video platform, with a focus on ease-of-integration and value-added applications. In addition, Huawei has exclusive responsibility for Shanghai Telecom’s triple-play strategy and triple-play interactive services.

Huawei had an exclusive partnership with Shanghai Telecom at the Shanghai Expo 2010 event, to offer a high-definition Blu-ray quality business video experience.

“Shanghai Telecom has a very good relationship with Huawei, both as a manufacturer and a service provider – not only for IPTV but also in many other telecom equipment areas,” said Dr. Xiao Qing, Senior Technical Director of Shanghai

Telecom.

“Shanghai Telecom has adopted many Huawei devices, but for IPTV, we think that Huawei’s primary contribution is the IPTV 2.0 Standard system commercially used in Shanghai. We have had a very good partnership in the design and deployment of these systems. Huawei has given us very good advice on new services based on IPTV. Huawei also gave us the first ideas for the HD settop box we use today. Not only does it support traditional IPTV services, but it also provides local video play-back, as well as game console functionality. Now, this kind of STB has become a standard of China Telecom,” she said.

Because of its role in Shanghai Telecom’s IPTV 2.0 initiatives, Huawei has helped this service provider implement a true anytime-anywhere multimedia communications service platform, with a competitive, high-quality TV offering and a wide range of value-added features that are ready to deliver in a device-appropriate manner to any screen.

Although consumers may not think of the telephone company in the same sentence as Apple iTunes, companies like Apple don’t offer live TV, broadband Internet access, nor can they offer traditional fixed-line or mobile telephone services.

In the end analysis, Shanghai Telecom’s tripleplay, any-screen service lineup already exceeds the offerings of the Internet content providers, and it appears that the best is yet to come.

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Winners

MTN Côte d’Ivoire fulfills mission impossible with NGBSS To improve its network performance, MTN Côte d’Ivoire pulled off an astonishing transformation feat with Huawei’s NGBSS, making it the most innovative integrated services provider in the country and consolidating its leading position in the local telecom market.

By Yang Tao

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Editor: Long Ji longji@huawei.com

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T

he year 2008 witnessed the telecom market in Côte d’Ivoire develop rapidly, with mobile services having since grown up to 50%. As the most important integrated services operator in the country, MTN Côte d’Ivoire is a leader in terms of market share and subscriber acquisition. Meanwhile, the operator never stops developing new services to diversify its service portfolio, which spans CDMA, ADSL, UMTS, WiMAX, VoIP, and IPTV.

Growing pains The rapid growth of MTN gave rise to a series of challenges, though. First, the operator’s IT architecture became over-complex with its diversity of services. With dozens of different vendors running so many components and subsystems, it lacked the flexibility of having one integrated platform for delivering business services.

Second, the value-added services of MTN were not very trusted by and attractive to customers, resulting in declining customer satisfaction and threatening customer loyalty. While the operator expected to improve ARPU by offering attractive new service packages and cross-sell its products, its business support system failed to provide the needed support. Standard changes, such as adding a new tariff package, often took two months or more to launch. Moreover, the CAPEX and OPEX for a new service were prohibitive.

Third, MTN had no unified customer relationship management system to handle customer requests and orders and manage its products. Finally, prepaid and postpaid customers were billed separately, and customers had no self-service portal for all their balance checking, account management, and charging concerns.

An inefficient, inconvenient operating support system (OSS) was a vexation to MTN and its customers. As for MTN the operator, the key to improving ARPU and market share lay in the integration of network resources on a standard platform that could seamlessly incorporate future telecom technologies to quickly develop new service packages that could satisfy customer requirements. Convinced that only an integrated business support system could solve the above

issues, MTN partnered with Huawei to seek a total solution, and their partnership led to the Huawei next-generation business support system (NGBSS).

Milestone in business operation MTN chose Huawei for its expertise in the BSS – ten years of experience plus 35 operators in 29 countries and 160 million subscribers served worldwide. The two companies also had a good history together: Huawei had helped MTN transfer from its TDM transmission network to a more efficient and affordable All-IP network in 2008. This move had reduced MTN’s OPEX by 50% while dramatically increasing call quality and network capacity, all delivered before the deadline.

MTN hoped to continue this strategic partnership in its efforts to overcome its new challenges. For this the operator selected Huawei’s NGBSS, a solution that included the CBS, OCS, WISG, AAA, IPCC, CCBS, Billing, PRM, FMS&RA, BI, Mediation/Provisioning, and was implemented based on the TM Forum Frameworx standard and Huawei’s best practice.

MTN benefited from the SOA-based integration framework of the solution, which provided such components as billing and revenue management, customer and product management, customer understanding and value improvement, customer care improvement and other relevant IT/CT components, in addition to system integration, managed services, and professional services. MTN’s requirements for high performance were fully met thanks to the solution’s simplicity, convergence, openness, agility, and intelligence.

MTN overcame the issues of complexity and redundancy with the legacy architecture, by taking advantage of the NGBSS’s simplicity represented by its sleek architecture and efficient business processes. Thus, the operator streamlined its IT structure, reduced difficulty in system integration, and improved operational efficiency.

Assisted by the NGBSS as a convergent system, MTN achieved convergence in terms of services, customers, business models and the value chain.

Featuring a unified customer view, QoE, end-to-

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end customer lifecycle management, billing engine, data model and product management, service subscription, customer access and mediation, the solution brought MTN customers consistent customer care, unified billing, and real-time user experience.

Also, MTN used the NGBSS as an open system compliant with the TM Forum Frameworx standard for realizing high integration and low coupling between its IT subsystems through the ESB based on the SOA design philosophy. The operator benefited from the agility provided by the solution featuring productization, modularity, flexible configurations and workflow engines.

Relying on the solution’s capabilities of real-time analysis and insight, MTN could fully understand and master the requirements of end users and develop an effective business strategy so as to optimize cost and resource efficiency.

Accomplishing the impossible To make sure that the solution would encompass all the core functional requirement specifications (FRS) necessary for all departments’ business operations, MTN’s CTO and CIO participated in all meetings side by side with both design teams.

Meanwhile, MTN expected the switchover to Huawei’s NGBSS to be completed within nine months of the project kickoff. It was a huge challenge for the operator, as it not only was a critical milestone in MTN’s business operations, but also presented an enormous risk: If subscribers experienced interruption in regular ser vice provision after the switchover, they might move to one of its competitors.

Riding on their positive cooperation and complete planning, the two partners came to the project’s moment of truth at 2:00 a.m. on Monday, August 24th, 2009: the one-time NGBSS switchover. That moment would determine whether their efforts over the past nine months had been worthy.

As MTN’s CEO and CIO looked on, their IT staff and Huawei’s checked the results. As of 8:00a.m., there had been zero errors for all of MTN’s subscribers and it was a 100% success rate

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for testing on all systems. The two design teams accomplished the impossible. Highlighting FMC, the new system achieved convergent billing for the GSM, CDMA and WiMAX networks, creating a watershed moment in the history of MTN’s business operations.

Speeding forward MTN’s one-time switchover to the NGBSS resulted in a highly-integrated and flexible architecture. This new architecture gave the operator an immense array of new competitive advantages that subscribers responded to with alacrity. For one, with average time to market (TTM) reduced from two months to just one week, the operator was able to rapidly deploy a string of new high-value services. Within one month of the commercial launch, MTN deployed Mobile Money, Mobile TV, MTN Zone, Booster, Friends & Family Number Extended service, Blackberry service, and a seamless roaming system (SRS) that covered all of West Africa.

In addition, the flexibility of the new architecture combined with MTN’s powerful new subscriber data collection tools to allow marketing to roll out many new attractive service plans. In June 2010, MTN launched advanced custom packages to individual, family, corporate, and government account subscribers alike, from hybrid prepaid and postpaid billing on the same account to International Roaming Solutions and special tariffs for voice and wireless data service, friends and family, and call placement in more than 200 Dynamic Zones.

With MTN providing such convenient and robust communication and business services based on the NGBSS, subscriber use surged in the months following the switchover. In the first four months of operation, ARPU rose by 40%, from USD8.00 to USD11.50. MTN’s subscriber numbers are now growing more than 10% faster than Côte d’Ivoire as a whole – by December 2010, the subscribers of MTN Cote d’Ivoire had totaled six million. Moreover, with the new system built to international standards, MTN can easily introduce new technologies.

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