Mobile music has punched above its weight on operator portals, but is the next wave going to take consumers away from the need to download music, to accepting an on demand streaming mode?

Consider this scenario: you're in the mood for some mobile tunes and must choose between paying per song to download a handful of tracks to your mobile, or simply pay a modest subscription to listen to as much 'streamed' digital music as you want, in some cases choosing from a library of over 250,000 songs to browse at your leisure.  Which would you prefer – downloading or streaming?
Mobile music streaming services are a breakthrough alternative to more established MP3 music download services. 

With music streaming, subscribers can access hundreds of thousands or millions of tracks, create their own Play Lists and even 'bookmark' the songs they want to listen to for a monthly subscription fee, in contrast to downloading which involves storing all the tracks locally on the device, and usually the customer is charged for each track downloaded.

Consumers expect music streaming to be a very enjoyable and user-friendly experience. They want problem-free playback, and when a song is interrupted by a phone call or other such event they should be able to seamlessly return playing the song at the previous point as soon as the interruption finishes.

Users should also be able to access published playlists and create and share their own playlists within the operator's music community. A music service should fulfil the basic requirements (i.e. allow access to listen to music), but increasingly advanced features are now regarded as standard.

Download Dominates
Both mobile and Internet music services available today still rely on download as the dominant delivery method. The reason is partly historic and may also be due to customer familiarity; the file transfer paradigm so popular in the Internet domain was easily applied to mobile.
File transfer is simple to develop and to use, and so took gained popularity before the first streaming services appeared. Consumers are also very familiar with downloading files to their personal computers and having a physical copy to keep on their machines.

Streaming was considered a great new way to deliver content (such as music and broadcast TV) over the Internet, while allowing the broadcaster to retain access and payment control.
In the personal computer realm, it was not so critical that streaming reduced the file storage requirements, because disk space has increased significantly in recent years. Considered more important was that streaming provided near-instant access to content and eliminated the wait to download the files themselves. Streaming also enabled live broadcasts to be delivered over the Internet to thousands of people worldwide.

Devices
Considering the mobile devices themselves, the much-hyped iPhone is a great MP3 player and user-friendly gadget but a considerable drawback is that it's incompatible with the current high-speed (3G) networks. The iPhone and iTunes also force the user into a proprietary music format and thus remain dependent on one provider, and one device, for all their music.

While some may not see this as a major limitation, it does restrict flexibility and makes it a challenge to have your music in several places at once (mobile phone, MP3 player, and personal computer). Therefore, streaming is a realistic alternative that can overcome some of the limitations of downloading the restricted music formats.

Download Limitations
Mobile music (and video) services do not always provide a great user experience when the content is downloaded. An important reason relates to storage space on the mobile and time.  Popular mobiles still have quite limited storage and slow network speeds, and customers commonly have to pay for airtime or every packet of data sent across the wireless network (at least in North America).
Furthermore, additional software can be needed to help the user manage the files on the mobile, and basic file administration (such as moving, copying and sorting) is usually very hard to do on such a device, often forcing the user to delete songs already purchased to free up space for new ones.
Another point is that Digital Rights Management (DRM) protection locks the downloaded files to a specific device (so called forward-lock); whilst a streaming-based solution can be very open in terms of moving content to other devices.

How Streaming Works
A very simple analogy to illustrate how streaming works is be that of taking a bath (a 'download') in contrast to a shower (a 'stream'): when taking a bath it's necessary to fill the tub with water to the desired level before getting in, whereas with a shower you can turn on the water and get in straight away!

Typically with a shower the flow rate (or data) is lower but you can actually finish sooner as you don't have to wait so long at the beginning.

With streaming, content can be played even while the data packets are still being sent over the network, so there is no need to wait until a complete file has been fully downloaded. Therefore a song or movie can begin to play after only a very short delay (a few seconds in most cases).
And unlike a download no file is ever stored on the device; instead it has "streamed" through in its entirety but can easily be viewed again by repeating the process. Usually the stream requires consistent throughput (i.e. a steady network without too many variations) to give a good user experience, although some mobile streaming systems such as Vidiator's Xenon Streamer maintain the streaming quality even in varying network conditions that are inherent in wireless networks.

Benefits of Streaming to the Consumers
The key benefits of streaming to the consumer are that it requires no storage on the mobile and allows access to a vast library of content with minimal delay to start playback.
Some streaming servers including Xenon support user-created playlists, to play songs in the desired order or in a randomized shuffle mode. A music streaming service can be considered a network-based MP3 player giving the consumer their own personalized listening service.
With all these advantages, one may wonder why downloading still dominates the mobile music services available today?

A possible reason may be that until a few years ago there were no high-speed networks available at a competitive rate, which is essential to stream large amounts of data to the mobile. With the advent of 3G networks it is certainly now feasible to deliver high-quality music and video to customers.
Furthermore, when the mobile is out of network coverage it's not possible to receive any streams, in which case customers may prefer to download music to the mobile to play at any time.

Benefits of Streaming to the Mobile Operators
Streaming also benefits the carriers, as they can leverage their purchasing power with the music labels to create a massive song library and earn ongoing revenues from this investment. The licensing cost of a streaming platform should be reasonable enough to leave an attractive profit margin.
Carriers need not worry about digital rights management (DRM) restrictions as they are not "selling" the music, rather they're loaning it to the subscriber.

Music artists enjoy a similar benefit to the network operator, as rather than a one-off revenue from selling a song, they can receive recurring royalties if customers regularly listen to their favourite songs.

It should be realised that even though a streaming service can be a very interactive and dynamic approach for music services, it does face some technical challenges.

A streaming customer must be on-line with network access to play their songs. However, other components in the system can provide a transparent synchronization (where strategic parts of the content is synchronized between network and mobile when in-coverage), so that the streaming-based music service can operate in all scenarios, working smoothly also in areas of poor coverage and when the consumer needs to be off-line.

A mobile streaming service can provide a realistic alternative (or enhancement) to a download service, especially when delivered over a high-speed 3G network that has widespread coverage.
It can also provide features not possible with a download-only offering such as live events and longer music tracks, and saves considerable space on the user's device in addition to decreased time to wait to start playing (a key benefit in today's world where consumers want their products immediately).
With the shift in paradigm from download-only and greater user acceptance, there should be increased take-up of streaming services both on the Internet and in the mobile space – something which surely benefits consumers, content providers and carriers alike.

Roland Bank, is Product Manager, Xenon Technology for Vidiator.

A theoretical technique that has been known about for years has finally been applied in practice to provide much more efficient power amplification, Julian Hildersley, vp strategy and marketing and Nujira, says

Radio networks account for some 80% of the total electricity used by an operator – and in current 3G base stations the linear RF power amplifiers (PAs) used in the RF transmission circuit account for approximately half of the total power used. 3G signals present such a challenge  in terms of RF transmission efficiency that ABI Research is forecasting that "Energy consumption arising from mobile broadband service delivery <…will…> grow from 42.8 billion kilowatt hours (KWh) in 2006 to 124.4 billion KWh in 2011".

On average, each fully-loaded 3G cell site using 'traditional' PA technology may require some 3.0 kW of power. For a typical European operator with a network of 20,000 base stations, the total energy consumption is approximately 51.7 MW (equivalent to a large wind farm) resulting in annual electricity costs of $60M, and annual CO2 emissions of 194,000 tonnes a year.

Linear RF power amplifiers are classic Class AB amplifiers, and operate most efficiently over a narrow range of power levels, when the RF envelope waveform is close to peak power. Whilst 2G GSM signals operate at constant amplitude and hence enable high efficiency UMTS, WiMAX and further evolved standards such as Long Term Evolution (LTE), are generating new, more challenging technical requirements. These include the need to support a variety of different channel coding and modulation techniques (CDMA, OFDM, etc.), broader channel bandwidths, and high peak-to-average power ratio (PAPR) complex modulation schemes.

In addition,  factors such as deregulation and the growth of new networks, particularly in parts of the world not yet well equipped with cellular networks, have created a requirement for basestations to support a wider range of frequency bands as new spectrum is released to meet urgent capacity demands.

Environmental or 'green' issues, such as the desire to reduce both direct and indirect CO2 emissions, and equipment size, are also moving up the agenda. Several operators have pledged to work with suppliers to increase the energy efficiency of their networks, because of the impact on the bottom line and environmental concerns. For example, Vodafone has announced that it will target a 33% improvement in energy efficiency of new network equipment by March 2008 (compared to the 2006 baseline). The savings, in both cost and carbon emissions, which could be made by realizing these PA efficiency improvements are huge. Vodafone has stated its intention to remove air conditioning units from sites where possible, which alone account for about 25% of network energy usage, and use remote radio heads where possible. But the removal of air conditioning units and the deployment of remote radio heads are only feasible if PA efficiency is greatly improved. Improving PA efficiency with high peak-to-average power (PAPR) systems is particularly challenging due to the need to use linear PAs to meet the critical RF performance criteria.

The new generation of Node Bs now starting to be deployed use techniques such as Doherty and Digital Pre Distortion (see panel) to approximately halve the figures quoted above, but the overall power consumption of 3G radio networks, and their carbon footprint, will remain unacceptably high, and bolder solutions are required.

Envelope tracking as a technique for improving power efficiency of RF Power Amplifiers was first described by Bell Labs in 1937, and has featured in RF design textbooks since. What has been lacking is an effective commercial implementation, because of the difficulty of making a power supply modulator capable of achieving the accuracy, bandwidth and noise specifications necessary at a level of conversion efficiency that delivers a significant energy saving for the system as a whole.  The threat of ballooning power consumption in 3G cellular base stations has lead to renewed focus on this area. The first practical implementation is Nujira's High Accuracy Tracking (HATTM) technology. The only addition required to the standard PA architecture is an output from the DPD/Linearisation function to drive the HAT Power Modulator with a digital representation of the modulation envelope. First released for the mobile basestation market, these new modulators are already seeing interest from digital broadcasters, and the possibilities of implementation in the handset are also being explored.
HAT(tm) envelope tracking (table 1) can make a significant contribution to the power efficiency of the PA, improving this from the 15% of 'traditional' PAs to 45% and more. A typical European national cellular network with 20,000 base stations could save 28MW per year – saving the operator $30 million in energy costs, reducing CO2 emissions by 110,000 tonnes.

Poor PA efficiency has a direct impact on the base stations cooling requirements. With a PA efficiency of 20%, 80% of the electrical power supplied is wasted as heat, requiring careful cooling design to reduce equipment temperatures and ensure reliability.

Cooling is a major concern for network operators for a number of reasons. Firstly, all forms of forced cooling involve moving parts in one form or another (fans, pumps, etc.) and other items such as filters that require regular maintenance. Secondly, mechanical noise can be a concern in many urban transmitter locations: some countries are already starting pass legislation to control noise levels at such sites. Finally, the cooling plant increases the equipment required on-site and hence site rental costs.

Another impact of poor PA efficiency is on the on-site backup power supply – higher transmitter power consumption necessitates either larger battery packs or larger diesel backup facilities, both of which again push up equipment and site costs.

It can be seen, therefore, that poor PA efficiency has a significant impact not just on the design of the transmitter itself, but also the cooling and backup facilities required on site, impacting both initial costs (CAPEX) and also long-term operational costs (OPEX).

The potential savings available from High Accuracy Tracking have proved so compelling that RF designers from fields as diverse as digital broadcasting and cellular handset design have shown an interest. Digital Broadcast Transmitters operate at about 2KW transmitted power, typically using a bank of parallel PAs, but there is no reason in principle why the envelope tracking technology applied successfully in 40W base station transmitters cannot be upscaled to work in this environment. Cellular handsets represent a very different challenge again, with a transmitted power of just 0.5W or so – but very tight constraints in terms of power consumption and space. Here the potential is not only to extend the battery life, but also to reduce the Bill of Materials cost involved in creating an RF front end that supports all the world-wide bands by having one wideband PA instead of several narrowband devices.

Power Amplifiers are commonly used in a huge range of electronic designs from military radios to satellite equipment to medical systems. Having proved the High Accuracy Tracking concept in the cellular network environment, there is no reason why it can't be extended in the future to other applications.

Will European mobile users be paying for receiving calls? It seems unlikely, despite a move to cut the rates mobile operators charge each other and move to a bill-and-keep system

Caller party pays was long reckoned to be of the reasons GSM made such quick ground over other markets, such as the USA, when mobile first became popular.  But the European industry has recently raised the possibility of European mobile phone users having to pay US-style charges for receiving calls – after Viviane Reding, the EU telecoms commissioner, said she was prepared to accept the industry changing its longstanding business model.

Ms Reding has alarmed mobile operators with her efforts to seek steep cuts in the wholesale charges operators take from each other for terminating calls on their networks. The industry has responded by hinting such a move might necessitate a move to called party pays -whilst simultaneously denying it has any such plans.

For instance, some operators have been reported as warning that one consequence of her efforts could be an increase in mobile charges for customers. And one operator said Ms Reding's moves could result in the introduction of the principle that Europeans pay for receiving calls – as well as making them – which is the norm in the US and some Asian countries, including China and Singapore.

The words that sent tremors came when Reding was asked whether she would like to see the introduction of the principle that Europeans pay for receiving calls, Ms Reding said: "Why not? The whole market is developing, so we should not stay on the rules that have been in place 10 years,"
Ms Reding attacked European mobile termination rates as "guaranteed money" that created "real distortion" in the EU single market.

She will publish proposals this month that will encourage national telecoms regulators to cut termination rates across the EU. The average EU mobile termination rate is 8 euro cents a minute, although the rates vary markedly between member states, and Ms Reding wants to see them cut to between 1 euro cent and 2 euro cents by 2012.

There was however, some concession in the follow up comment, "I think the business models are not for the European commissioner to decide. Business models are for the operators to decide." Of course, faced with an obligation to cut termination rates, there aren't many business models for operators to follow, other than either swallowing the losses, or passing on the costs to the users.
There is an argument that the practice of asking users to pay for receiving calls has resulted in low mobile termination rates, with US consumers enjoying lower mobile charges compared with Europeans. However, the absence in Europe of the principle that consumers pay for receiving calls is regarded as a key factor in why many EU countries have higher mobile ownership levels than the US. The industry certainly argues that there must be a clear consumer benefit in the current model, given widespread penetration rates of voer 100%, and a clear lead in service innovation in the market.
So what happens now – will the whole system of interconnect billing and termination rates face a radical shake- up, or is this something the industry will be able to fight?

Certainly, there does seem to a will at the Commission level to do something about termination rates. Following Reding's comments, her spokesman Martin Selamyr said that in his view, 'Clients are paying costs that are avoidable', Martin Selmayr, spokesman for EU telecoms commissioner Viviane Reding told reporters.

Reding will present a recommendation before the end of the month to lower regulated MTRs 'to a level that would make it interesting for operators to move to a less bureaucratic system of bill-and-keep in the long run', Selmayr said. Bill-and-keep is another term for the system employed in markets that employ called party pays models.

He underlined that this is 'a long-term perspective for Europe's mobile communications market', adding that it would 'in the long run mean less red tape, more competition and lower charges for consumers'.

John Blakemore, Director of European Regulatory Affairs at Hutchison's 3 Group, did agree that a move to bill-and-keep could bring prices down for consumers.

'In the U.S. there are no termination rates, and retail prices are lower', he told Thomson Financial News. Under the existing rules, operators pass the cost to connect a call to another network on to their consumers. 'One of the problems of high termination rates is that calls are more expensive', Blakemore said. But whether large operators, whose revenues are boosted significantly by MTRs, will want to move to a bill-and-keep system remains to be seen.

Companies are allowed to charge the effective cost of connecting calls to their network, but the Commission has doubts as to what the real costs are, given the lack of consistency across the European Union.

'Some [MTRs] are calculated by regulators at around 2 euro cents per minute, others at around 19 or 20', Selmayr said.

The Commission now wants to do away with widely divergent MTRs, set by national regulators, and some faer that it sees bill-and-keep as a possible solution.

So what will the impact on operators be? Britain's operators have all rejected the  likelihood of a major pricing shake-up. With official guidance to individual regulators on the issue due to be issued early next month, a spokesperson for Vodafone said that the chances of "new radical pricing is pretty slim", and could only repeat other statements that the operator had "no plans to introduce such a pricing model at the moment".

In the UK, BT and 3, the UK's smallest operator and of course one without its own 2G network, already have a case with the Competition Commission alleging that the practice, which once mad, is now obsolete. But 3 itself said in a statement that "there is no reason for the EC recommendation to result in receiver pays".

An Orange spokesperson said only that the operator "has no intention to introduce charges for [its] customers to receive calls domestically". T-Mobile's said it too had no plans for called party pays, and O2's pointed out that moving to called party pays would need to take place across the EU at once.
Meanwhile, Reding's office said that the very suggestion of called party pays was a red herring, designed to introduce a worst case scenario resulting from regulatory pressure on mobile termination rates. This, of couse, is slightly at odds with earlier messages that Bill-and-Keep could be a long term option, to support lower termination rates.

The unmentioned aspect, so far, has been that mobile operators in Europe have set up billing systems that face the customer on a called party pays basis, with mediation and interconnect between themselves. They are currently in the process of moving many of these systems to deal with data roaming, as well as the cost of moving large amounts of data across different networks. Although voice is a mature technology, investment decisions in these areas have been made with the current billing model in place.

It is understandable that regulators want to address termination rates where they see they merely keep prices artificially high, but tacitly placing pressure on the whole billing structure of how money goes around in the industry is something that needs very careful attention indeed.

What was being said at Femtocells Europe 2008?

I spent a couple of rewarding days last week asking lots of people lots of questions about Femtocells. I think we got some good answers about how standards are shaping up in this market, who the main runners and riders might be, what the likely business models are, and even who some of the winners might be. If you're interested in this market, and why would you not be – given that it touches on most current concerns close to operators' hearts, have a scroll through – there's bound to be something there of interest.

Thanks to Avren Events, and our sponsor ip.access, for giving us the opportunity. If you want to see the results, Click here.

With Intel considering a possible LTE/ WiMax tie-up, how will that influence the traditional dominant players of the cellphone market?

According to Richard Kramer at Arete, a research and analyst company tracking the wireless industry, only thre chipmakers shipped over 100 million units in the wireless industry last year. Those three were Nokia/ST, Qualcomm and Ericsson.

This burgeoning scale meant that others were rapidly losing out. Kramer asks, who is going to take LTE chipsets, and at which cost. He predicts that without support from a top tier OEM, such as Nokia gives ST, TI and Broadcom, and Ericsson gives TI, then other players are going to lose out.
Given the fact that LTE will be responsible for perhaps 6-85 of handset volume, and Ericsson and Nokia will want the lion's share of that between them, then can the other companies support the level of R&D investment required to keep up?

Kramer envisages a model where IPR costs passed down to operators have to lessen, as chipmakers follow a different model.

Certainly this is the route Ericsson and others took when, Alcatel-Lucent, Ericsson, NEC Corp, NextWave Wireless, Nokia, Nokia Siemens Networks and Sony Ericsson Mobile Communications all signed on to a press release stating a "mutual commitment to a framework for establishing predictable and more transparent maximum aggregate costs for licensing intellectual property rights that relate to 3GPP Long Term Evolution and Service Architecture evolution standards."
The parties said the framework is based on fair, reasonable and non-discriminatory (FRAND) licensing terms. The companies noted they support a maximum aggregate royalty level for essential IPR in handsets as a single-digit percentage of the sales price. For notebooks that might integrate LTE modems, the companies agreed to a single-digit dollar amount as the maximum royalty level.
That level of IPR take would probably mean that the vendors would seek profits instead through a channel pricing model, rather than on steep IPRs. This could and should make the cost of introducing a new technology more acceptable to operators who faced delays and cost with the development of 3G, where handset development was held back by disputes over IPRs and the costs of IPR.
Yet as well as Kramer's predictions, there is another area of investment plunging into OFDM chipsets that also threatens the business case of many players in the semi market -that of the WiMax chip vendors, and specificall Intel.

Intel sees itself as a company that can create markets b the force of its own investment – witness WiFi and now WiMax. It also sets trends, in order to seed its own future revenue streams. The problem for Intel as devices  go multi-mode, and service offerings converge, is that it is nowhere in cellular chipset market. Of course, there is also an opportunity, as it could lead convergence from the PC/ WiFi side of the fence.

There was a notable softening of Intel's "WiMax is best" stance (to greatly simplify their arguments about time to market, cost and technical superiority)recently when Sean Maloney joined the small group of industry heavyweights calling for the wireless industry to unify its OFDM paths, which currently lie separate as LTE and WiMax.

Vodafone's soon-to-be-ex CEO Arun Sarin famously mused that perhaps WiMax could form the TDD part of LTE, but many thought Intell, which stands to gain the most from a vibrant standalone WiMax market, would resist.

Yet other chip makers in the WiMax market are quite happy to countenance the idea not just of making chips for both LTE and WiMax developers, but of developing multi-mode chips that would support devices to operate either on both standards, or be "switched on" to one or other standard as the OEM required. If you add to this the difficulties with the patent pool within WiMax, and the slow perdio of standardization and market development, a warmer Intel attitude toards LTE makes more sense.

Speaking to the BBC, Maloney said, "In our view they ought to be harmonized," He agreed with the industry consensus that when it comes to the iair interface, the two camps are about 80% similar.
"The main difference is that WiMAX is a couple of years ahead," he added, interestingly.
Apart from this being the standard WiMax camp line, this is important because wit so much development and R&D dollars sunk into WiMax already, there might be a case to be made that the cheapest way to get to LTE chipsets would be to leverage much of that investment (and associated IPR, obviously).

Maloney pointed out that is was possible even that the Wi-Fi/WiMAX Centrino 2 could be adapted for LTE, though he highlighted this"would certainly be a nice long term goal".

Just as interestingly, given our boxout on the MID market, Intel hopes that its Atom mobile internet device chip will give it with a re-entry into the mainstream mobile market after the sale of its XScale mobile processor division to Marvell. Atom's mobile form, known under the code Pineview is said to be ready in 2009 – a year before the first LTE networks are expected to be commercially live.
So there are signs that the traditional cellular chip vendors and developers may not have everything their own way – there are their own internal challenges to be addressed – and those of their ultimate end customers, the operators. Then there is the challenge from the WiMax developers, and there are players here such as Sequans who have valuable businesses – it's not all about Intel.
But crucially, the cellular players will view this as the market coming to them – not them having to work out the threat of Intel.

"There's a lot more to this business than making chipsets to run in PCs and notebooks that are only ever really used in a static environment. We understand the demands of mobility, of power management, of processor power, that mobility paces on device," one developer told us. "Intel has made a great business with WiFi, and is now having less success with WiMax. It realizes the future is converged, mobile devices, and it is sitting on the wrong side of that convergence divide."
However the market breaks down over LTE chipsets, there is perhaps a bigger question to ask at the moment. As operators sweat 3G and HSPA assets or some time to come, will there be enough end investment in LTE to justify any of these business models. Now that really is a bearish question.

Looking Forward to the MID range

Forward Concepts has announced the publication of a new study that covers the market prospects of the emerging Mobile Internet Device (MID) that serves a gap between high-end smartphones and ultra-portable PCs (UMPCs). 
Mobile Internet Devices (MIDs) represent a new class of mobile communications and lifestyle devices. Its hardware, software and form factor will require design from the ground up in order to meet market requirements for features, price, performance, and power requirements.
– The user interface will be key to success and will likely need to be capable of responding not only to touch-based inputs but also keep pace with other evolving input methods such as ones based on motion, gesture, placement, etc.
– Although Apple's 3G iPhone plows new ground in Internet access, user interaction and utility, we don't consider it to be a MID, since we believe a true MID also requires a larger (4- to 6-inch) screen with higher resolution (VGA), TV out and optional Mobile TV capabilities.
– Global MID shipments will grow from 305,000 units shipped in 2008 to almost 40 million in 2012, reaching $12 billion in revenue.
– Integrated circuits for MIDs are forecast to grow from $29 million in 2008 to $2.6 billion in 2012.
– Intel has a much better shot at UMPCs, being predominantly an enterprise play, where x86 compatibility is important, and with battery life expectations in line with notebooks.
– Texas Instruments, with its mature and proven OMAP application processor  family and the largest market share of the stand-alone Smartphone applications processor market, is one of the two best-positioned non-X86 semiconductor vendors for supplying stand-alone applications processors for all classes of MIDs.
– Qualcomm is the other best-positioned non-X86 semiconductor vendor, with its powerful new SnapDragon application processor and the company's market-leading 3G wireless solutions required for the MID market.
– Other chip suppliers will have plays in the MID market, including Nvidia, with its strong graphics capability which will play well for gaming applications and Samsung, with its applications processor experience and stacked memory capability.

Many operators have announced plans to combine wireless solutions with traditional fixed telecoms and broadband offerings. In supporting these initiatives a significant amount of emphasis has been placed by observers on the underlying network technologies – WiFi, 3G cellular, Bluetooth, SIP, hybrids like UMA (unlicenced mobile access) and next-generation carrier core network architectures, like IMS. However, until now, there has been very little focus on the challenges of billing, provisioning and supporting FMC services

Given that traditional fixed and mobile services have been tariffed and marketed very differently, the "behind-the-scenes practicalities" of creating converged services required foresight and flexibility on the part of the service provider and, equally importantly, their back-office infrastructure.
In particular, FMC services have needed significant new approaches for billing and OSS, with suppliers needing to demonstrate the ability to cover a wide range of potential future business models.
In an ideal world, creating, deploying, billing and managing FMC services would be (relatively) simple. Converged operators would all run both mobile and fixed networks, offering a homogeneous array of services. Uniform and ubiquitous use of technologies like IMS and SIP would permit the creation of "seamless" services, without the need for complex legacy integration between different service providers or technical domains. Billing and customer care would be predictable, and structured around a finite and controllable set of variables.

Unfortunately, the real world is much messier.
Some operators started from a fixed point of being fixed-only or mobile-only. Local competition and regulatory environments resulted in layering of incumbent operators, broadband service providers, MVNOs, 3G-only network operators, managed service providers and retailers. Each of these have different technological preferences and deployment roadmaps. Third-party VoIP providers and content/service firms abound. Corporate users still like the familiarity of PBXs or the flexibility and value-add of new IP-PBXs. New access networks like WiFi and WiMAX add additional disruption to FMC value chains.

The net result is that converged service providers now have to contend with a unprecedented number of 'moving parts'. Yet many FMC providers do not own the complete set of underlying networks, especially on a broad geographic basis. Instead, most will work with partners to develop joint services.WiFi aggregators, in-building coverage specialists, corporate managed service providers and 3rd-party content and outsourced service providers may also be involved in many FMC business models.

This mandates that operators pay close attention to the underlying contractual details made between each other and partners. This goes far beyond traditional interconnect, and will have to cover myriad new business relationships.

Providing this type of offer means that FMC operators need to ensure that their back-office systems are capable of dealing with the necessary subtleties to enable effective wholesale billing and revenue-sharing.

The enterprise
This is an area that poses particular new complexities for mobile operators. Although in theory they canoffer outright "fixed-mobile substitution", especially to SMEs, it is clear that services need far greater richness to compete with fixed systems like PBXs (eg contact centre functionality, free/low-cost "on-net" calls between employees, call transfer, integration with CRM and salesforce IT systems etc).

Apart from anything else, most corporates own and operate extensive and high-performance IP-based data networks, and these are already proving a strong platform for integration of fixed voice solutions like IP-PBXs. At the same time, increasing numbers of mobile workers are driving up businesses' dependence on cellular and other wireless technologies. Consequently, there is already a large and growing demand to tie mobility-related voice and data communications more tightly to the IT and fixed-network domain.

Given that few cellular service providers have strong enterprise network/PBX skills, there is a need for many to partner, either with fixed operators, systems integrators or managed service providers. Unlike residential offerings, corporate FMC is likely to involve the internal IT/telecoms department in order to deliver complex communications services. The boundary between "public" and "private" brings a new dimension, which underscores the value-chain complexities discussed in the previous section, especially as the "business model" used in corporate private networks is usually oriented around free "on-net" calls.

Once again, this puts traditional operator back-office processes under considerable stress. Billing and contractual revenue-sharing with partners will have to go far beyond simple interconnect reconciliation. For example, a company may expect its cellular tariffs to zero-rate in-building "local" calls, or discount ones made by employees from their homes.

Larger enterprises may also look towards web-based policy management interfaces for their employees' mobility usage. If carriers are unable to support this type of tariff structure, it will provide further impetus for the enterprise-based solutions which attempt to minimise service expenditure, through the use of "plain vanilla" IP pipes and least-cost routing intelligence. Operators have a narrow window of opportunity to prove the value of integrated services through flexible and sensible pricing, billing, ordering, support and other customer-facing processes.

From the foregoing sections, it should be clear that billing, customer interface and the management of multi-provider joint services are fundamental underpinnings for commercial FMC services.
There are huge differences between traditional business models in the fixed and mobile worlds. Combining these into commercial FMC tariffs and acceptable customer experiences has been complicated, and has needed several rounds of trial-and-error to perfect. Platform flexibility has been and will be critical.

Customer vs. Network-centric
Having asserted that billing and associated OSS functions will be of paramount importance to the success of FMC services, it is important to delve deeper into the most appropriate way of delivering those capabilities. This battle relates to the "location" of the business logic, controlling what services a subscriber can access, under what conditions and to what tariff and credit terms. This has ended being more "IT-centric" than "network-centric".

In this context, IT-centric billing involves putting the "customer's view" at the centre of the operator's system, and enabling a variety of services and features to feed into that hub, even if those services are only "loosely coupled" at a network level. This approach makes it easier to consolidate the various services the customer is signed up for, enable fully online customer management, such as service, configuration and authorisation features, and bring in assorted 3rd-party offerings and marketing and bundling approaches. The level of integration work required is dependent on the openness of current networks, and the tools to interface separately with each of the underlying technology/network platforms. It may also make it difficult for the platform to have complete and uniform access to real-time operational data, such as fault status or forecast availability of capacity, as the different networks' sub-systems may have differing abilities to provide such information or functionality.
By contrast, the network-centric approach involves unifying the various network and device platforms as far as possible, in order to gain process efficiencies and enable the billing/OSS function to "see and control" everything. However, this is only feasible for those networks that can be easily integrated, and, as previously discussed, the FMC world is still quite far from a homogeneous IMS/IP/SIP Utopia, in which everything involved in a hybrid service shares a set of common technical standards.
While certain "point" FMC services may be more suited to this network-centric approach, especially where a single operator controls the whole system, there are likely to be many more instances where this level of proscriptive service provision is simply not possible.

An example of appropriate service for a network-centric approach might be a technically-rich variant of in-building wireless, connecting a PBX to a local softswitch to enable "on-net" calls to be routed/billed separately. Some of the UMA-style services extending GSM signalling over residential broadband, from a cellular network core, may also fall into this category. Here, voice remains the main application.

Conversely, the types of content-oriented service described above (eggaming or music, spanning PC and mobile phone), are heavily oriented around portals and service delivery platforms, with highly-fluid revenue-sharing and partnering arrangements, which cannot be "hard-wired" into the network. As applications and devices move towards SIP and standardised open interfaces, easier creation and deployment of new forms of interactive service will also tend to favour the IT-centric approach.
Lastly, complex multi-operator value chains have placed a premium on those billing architectures that enable rigorous cross-checking of wholesale/accounting data, as well as facilitating the development of new types of multi-party contractual relationship. Margins are driven by the ability to negotiate favourable contracts with "suppliers" (ie other operators/service providers) – and the ability for software infrastructure to support and bill for those contracts appropriately.

Carriers need to recognise this, and raise their collective game, to make their own services more accessible and attractive than roll-your-own DIY alternatives. To avoid IP-based commoditisation, they need to deliver customers far greater value in terms of application packaging, service and convenience. Again, billing and customer-centric capabilities come to the fore.