..Mobile payment and walled gardens. What’s theconnection?

If you can appreciate how difficult it is merely to get several operators together in a room to discuss a subject such as m-commerce then you can probably grasp why it has taken Simpay, an alliance of operators focused on producing a unified payment for digital mobile content, two years to even get to the point of announcing its first service launch.

“Of course, perhaps things could have speeded along a little quicker, but the important thing is we are here now,” said Vodafone’s director of consumer marketing management Guy Laurence at a round table event organised by Simpay, at which all the participating operators were present.  Simpay has now put together its technical team and its “merchant acquisition” strategy. Merchant acquisition is the term, imported from the credit card world, to describe the process by which operators or content aggregators will get vendors to join the Simpay scheme. It is important because the cake in Simpay will be divided up very differently in the mobile world than in the credit card business.

Selling mobile digital content is different from the credit card industry because people are buying not clothes, holidays, expensive meals, but ringtones, video clips, music tracks for perhaps 2-5 Euro. This means that each transaction needs to be affordably processed with much less to go round. Nonetheless, the operators (Orange, T-Mobile, Vodafone and Telefonica, now joined by Proximus and Amena) have pushed ahead with trying to get something off the ground, and Amena has launched a service in Spain.

The reward for operators with Simpay is that they will get a hook into the business of people buying content off-portal. Of course, operators will never admit that they are considering the walled garden approach to content, but the control of access to content is still a ticklish issue. It seems that premium content with chosen partners will still sit on-portal, ie within your Orange World or T-Zones. Then there will be a second tier of content which will be at arm’s length from the operators, perhaps within an extended “approved” capacity. Then there will be genuinely separate third party content whose origination and access has nothing to do with operators. Simpay’s partners hope that their scheme will make it easy for users to access content from these providers, but also be able to trust the reliability and security of the content (ie it is bug free and works on their phone).

Simpay is important because it means operators will feel they have some value to take from their users downloading off-portal content. In Cannes, Orange’s briefing made great play of how IP converged services would mean users could access content wherever they were, through whatever access technology. But in all the talks the connection was always to the OrangeWorld site. But of course, controlling where you users choose to access content will be effectively impossible once back end service platforms and media player technologies on phones themselves have converged. If a phone is effectively an MP3 player, and a you can download MP3s from thousands of sites, why bother do so through your mobile operator’s content portal?

When you look at is like this, Simpay becomes less about a few operators getting together to persuade people to buy more stuff, and in fact crucial to the content strategies, and therefore the future viabilty, of the operators themselves.

Antonio Policek looks at the issues surrounding the troubleshooting and optimisation of UMTS Networks, and explains how operators need to break down their KPIs service by service, network element by network element.

With UMTS networks offering a variety of customer services — from voice to video to online gaming — troubleshooting or optimizing networks is growing increasingly more complex for mobile network operators, who have looked to the traditional network key performance indicators (KPIs) as a tool for understanding and troubleshooting network performance. 

Unfortunately, the term ‘KPI’ is loosely defined.  Some operators have turned to the KPIs found on their network equipment only to discover that, as the network load increases, these KPIs fail to identify problems correctly.  The result is that operators still face the challenge of identifying the best metrics for describing their customers’ perceptions of service quality and are looking for tools that go beyond merely recording network problems — and instead provide insights into why those problems occurred.

KPI protocol analysers

Traditional KPIs used in 2G and 2.5G networks are giving way to new, dynamic KPIs that take UMTS radio interface parameters into account and use protocol-related event counters.  KPI hardware and software measurement tools must accomplish several things for performance related data and dynamic KPIs to be useful as UMTS network optimization and troubleshooting tools, as well as by equipment manufacturers as protocol testers:
*  Capture performance related data accurately
*  Contain a set of pre-defined, non-vendor specific KPIs useable in any UMTS network environment
*  Provide a software-based graphic user environment designed to fit to the changing requirements for data acquisition and measurement, including the ability to update KPI definitions and calculations
*  Offer drill-down capabilities for network error analysis and troubleshooting

For UMTS network optimization and troubleshooting, a protocol analyser works on typical network environments that involve multiple vendors.  They provide operators with insights into the problems in 3G networks and customer’s needs.  Rather than merely collecting and reporting data, they become tools for exploring the root causes of network problems.

KPIs and how to use them

A KPI is a mathematical formula describing network quality and behavior for optimizing a network.  A clear and easily understandable comparison of the ideal KPI values points, with actual observed network performance, help an operator determine whether action taken to improve network and service quality have succeeded.

KPIs are made-up of performance related data: for example, performance related data event counters can be used to count protocol messages that indicate successful (or unsuccessful) procedures. Standards groups assist with this process.  For example, documented in 3GPP 32.403 are a long list of easy-to-define Success and Failure Ratios based on performance measurement definitions.  These values are useful, because they give an overview of network quality and behavior and are helpful for identifying problems in defined network areas.  For example, when GRPS Attach Failure Ratio is extremely high in a defined SGSN area this indicates a potential problem.

Finding root causes

Whenever a KPI value indicates a problem, it is then necessary to find the root causes using a drill-down analysis procedure.  The first step to find the root cause is to analyze the reject cause values of Attach Reject messages.  The sum of each possible Attach Reject cause value is displayed as a column in a table on a protocol analyser. In addition, graphical overviews — bar diagrams or pie diagrams — make it clear which are the most common reject cause values. 
Sometimes it is not enough to determine that the KPI results indicate an erroneous procedure or not.  Another problem emerges when analyzing the results: if the reject cause value is, for example, ‘network failure,’ typically this is not sufficient to determine the root cause of the problem and more analysis is required.
From 3GPP 24.008 (Mobility Management, Call Control, Session Management) an operator knows that the cause value ‘network failure’ is used “if the MSC or SGSN cannot service an MS generated request because of PLMN failures, e.g. problems in MAP.”
Most likely, the root problem of this Attach Reject seems to lie inside the core network.  It can be analyzed in more detail using the next step parameters of Attach Request messages (ATRQ) that are essential for routing core network messages, especially IMSI, and determining the relation to the appropriate Attach Reject (ATRJ) cause values. This is an example of a procedure that requires not only data acquisition, but context-related filtering, extracting and storing of call parameters belonging to single user and/or call procedures.

After IMSI analysis, it might be discovered for example that that all ‘network failure’ rejected attach attempts were sent by roaming subscribers.  Further investigation might show that there were no roaming contracts signed between the monitored PLMN operator and the Home PLMN operator of the roaming users.  Therefore, SGSN was not able to connect to the roaming users’ HLR, as indicated by cause value ‘network failure.’  From the point of view of the roaming subscriber, this result is unacceptable network behaviour, but from the point of view of a network operator, the network executed correctly.

In this case, the root cause was easily found and based on flexible presentation of the analyzed data.  (Step one: Show number of ATRJ messages sorted by included cause value.  Step two: Show IMSI related to Attach Reject with cause equals ‘network failure’).  Such techniques are often reported by existing performance measurement and troubleshooting software tools.
What is missing, however, is a drill-down analysis that goes further and includes steps and answers to deeper questions. Unlike the example above, not all ‘network failures’ indicate correct network behavior.  And how can such ‘correct network failures’ be distinguished from ‘unacceptable network failures’ that may show the same reject cause value, but have been caused by incorrect network behavior — for example interconnection problems between home and visited PLMN?  It is important to know if measurement equipment offers drill-

down analysis capability, and equally important to know the type of drill-down analysis provided.

For example, it’s important that a KPI protocol analyser offers highly flexible presentation methods for extracted data parameters, such as IMSI and cause values.  This flexibility allows users to determine which parameters are shown in a single statistics table and how parameters are arranged in columns and lines. Advanced drill-down analysis capabilities are achieved linking KPIs to the detailed list of calls that contributed to generate the KPIs themselves. A multi-interface call trace application that supports Iub/Iur/Iu/Gr interfaces is used to identify the network area responsible for the problem.

Custom configurable KPIs

For accurate benchmarking activities, a predefined set of KPI is, invariably, not sufficient. Operators need to have the ability to define their own KPIs according to their own rules. Using a protocol tester, operators can create KPIs containing the specific selected parameters that they need to carry out ad hoc network analysis.  They can capture specific messages or specific abnormal network conditions and then, using simple arithmetic operations, simple Boolean operations, or simple correlation functions (for example, counting all cell reselection procedures triggered by a paging message) they can identify problem root causes. With drill down capabilities they can then analyze the problem on a per call and per service basis.

Statistics & display options

As operators optimize their networks and identify the problem domains, they want to review and analyze the same set of KPI measurements from several perspectives and in different ways.  They may start their analysis from diverse starting points that vary depending on the type of analysis and service they focus on. Once they have seen the first measurement KPI results table, they will often want to gain deeper insights into data details by browsing through the data.

To help accomplish this, some protocol
analysers offer data entry points called ‘dimensions’ or views, along with a main analysis path that guides users as they browse through the data to following a line of inquiry.  These measurement systems allow operators to visualize KPI measurement results in these ways:
*  per Service
*  per Network Element
*  per Subscriber

Once the operator measures a KPI, these ‘dimensions’ can provide a quick means of looking through the acquired data to narrow down the problem and ultimately the root case.

A common KPI, like call drop rate, is meaningless if it is not possible to breakdown the measurement by service, by network element and by subscriber.  A very high call drop rate, for example, can occur just for video calls and not for voice calls.  The call drop rate might be higher in a portion of the network connected to one specific radio network controller (RNC) rather than in another area of the network connected to another RNC.

Finally the call drop rate may affect particular subscribers like roamers and business users that might be more sensitive to quality of service.  Because of this, once a KPI has been measured it is necessary to be able to have access to the list of calls that generated that specific KPI in order to understand the impact of the quality degradation onto the final subscriber.

UTRAN specific KPIs

The ‘classic’ success and failure ratio KPIs, based on protocol events counted on land line interfaces, as well as some throughput rates measured on the same interfaces, are not sufficient to provide an overview of UMTS network and service quality.  In fact, nearly 70 percent of the UMTS problems are found in UTRAN arena.  The bigger problems involve the radio interface (Uu) or on interfaces close to radio interface (Iub, Iur).

When using a protocol tester, new, dynamic KPI definitions can be based on protocol-related event counters that also take cellular radio interface parameters into account: the signalling events that are regulated by network protocols can be correlated with the conditions of the radio interface and, therefore, they indicate what network problems most affect the ultimate quality of service perceived by subscribers. For example a high sustained throughtput over time for a specific subscriber session performing file download can be jeopardized and reduced by frequent retransmissions on the radio interface that typically indicates a radio link quality issue.

Service specific performance measurement

It is also necessary to look at what kind of service is behind each call, because optimization and troubleshooting processes may differ from service to service. 

A protocol analyser needs to examine different services separately by breaking them out into the appropriate service, such as: Adaptive Multi-Rate (AMR) voice calls; PS calls (PDP contexts); Multimedia calls (H.324M); and Short Message Service (SMS).  But even further classification is possible, and all measured and displayed data can be arranged so that it is displayed by cell, RNC, MSC, SGNS, APN, etc.

Protocol tester users can look at a long list of 3G-H.324M KPIs, to garner insights about what’s happening on their network:
*  Service Access or Service Release Times
*  Service Set-Up Success Rate or Dropped Session Rate
*  Peak Signal to Noise Ratio
*  Frame Rate, Payload Bitrate: the bitrate carrying video and audio signals reflecting the effective bandwidth utilization.
*  Dropped Pictures and video delay
*  Audio frame error rate, frame loss rate or Audio-Video Sync
*  Jitter
*  H.245 retransmissions

Conclusion

KPIs with breakdown per service (voice, photo, video or packet), per network element (cell, NodeB, RNC, SGSN, MSC and others) on a call by call by subscriber basis (such as IMSI or MSISDN) are needed to navigate through data acquisition results and to narrow the scope of problems to isolate their root causes.  KPI protocol analysers help in this analysis by providing an independent third-party analysis tool for UMTS network performance. 

Measurement-based KPIs not only help report the presence of UMTS network problems, but also help operators derive the root causes of problems.  However, for them to do so, once they know the problem, it is important that they drill down to the root cause in the network.

FMC services will require new approaches for billing and OSS, with operators needing to cover a range of potential future business models, says Dean Bubley,  of Disruptive Analysis

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 will require foresight and flexibility on the part of the service provider and, equally importantly, their back-office infrastructure.

In particular, FMC services will need 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 are fixed-only or mobile-only. Local competition and regulatory environments result 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, WiMAX and OFDM add additional disruption to FMC value chains.

The net result is that any future FMC service provider will have to contend with a unprecedented number of ‘moving parts’. Although future technologies like IMS and all-IP communications would, theoretically, simplify the process of deploying FMC services, Disruptive Analysis expects to see huge innovation in FMC, well in advance of the promised “IP everywhere, single device/bill/number/ provider” utopian future.

This is not to say that “elegant” FMC solutions will not appear. For example the BT Bluephone and the Motorola/Avaya/Proxim PBX-based solution, are finely-crafted technical approaches, using complex dual-mode devices and end-to-end management. However, Disruptive Analysis believes that while these and other sophisticated, engineering-led approaches will probably succeed in the medium term, there will be a lot more marketing-led or service/billing-layer FMC offerings emerging, while the inevitable glitches are ironed out.

Many FMC providers will 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 will mandate 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 will mean 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 business marketplace

Although the residential marketplace is larger in terms of absolute number of potential customers, it may well be that many FMC services start to be deployed in the enterprise first. This is an area that poses particular new complexities for mobile operators. Although in theory they could offer outright “fixed-mobile substitution”, especially to SMEs, it is clear that historic services will 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. At the same time, many corporates are closely

scrutinising their existing cellular spend, which is often spiralling higher at a rapid pace, and is typically poorly controlled and lacking centralised policies.

In many ways, the trends from the fixed/IP side of the market are running ahead of cellular innovation, particularly with the current huge emphasis on WLAN and VoWLAN. Compelling arguments abound for reducing “wasted” in-building cellular spending, when existing fixed/WLAN networks could provide cheaper or free “on-net” calls. As a result, IP-based fixed/wireless integration may end up setting the agenda for subsequent fixed/mobile convergence, to the detriment of the slower-moving cellular providers.

Many corporates also have cellular coverage blackspots in their buildings, a situation which is likely to worsen with the move to 3G. A variety of solutions exist to provide coverage. By definition, this could also be deemed to be a form of FMC, especially as an increasing number of such solutions look to leverage the existing copper or fibre plant in the building. In the case of IP-connected picocells, coverage may link directly with the company’s LAN, while “local” softswitches are also emerging, facilitating tight integration with the firm’s PBX, even to the extent of treating ordinary cellphones as ordinary “extensions” on the private voice network.

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 will put 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.

Billing is critical

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 will be complicated, and will probably need several rounds of trial-and-error to perfect. Platform flexibility will be critical. Among the most difficult aspects to reconcile will be:

*  Prepaid billing: Virtually unheard-of in fixed telephony, outside discount international operators.
*  Subsidies: Mobile phones are often “locked” to a given provider. Conversely, most fixed telephony devices are bought independently from service provision.
*  Bundled Minutes: Most mobile postpaid contracts include bundles of minutes, and maybe SMSs and other data components, whereas most fixed telephony bills separate out a fixed “line rental” charge and strictly pay-as-you-use call charges.
*  Tariffing Variations: Costs vary substantially. For example, calling non-geographic numbers is often much more expensive from a mobile phone. In data pricing: cellular networks often charge $1-5 per MB of data, while even stringent “capped” broadband services usually offer 1-2GB for perhaps $30 per month.
*  Discount Call Plans: Many fixed operators’ networks/IN and billing systems are capable of allowing discounts on user-selected frequently-called numbers and business hierarchies, whereas this is not typical of most mobile operators
*  “Local” FMC calls: Fixed-line services are tied to a specific location, and usually have different tariffs for local and long-distance calls. While calls to/from mobile networks can easily be priced separately, when the services are separate, this may not be commercially-viable in the context of FMC offers.
*  Individual users vs. Households: Mobile phones (and services) are typically geared to use by a specific individual, while fixed phones, especially in domestic situations, are usually shared among all family members. New billing/tariffing mechanisms, like “shared family minutes”, with ways for the bill-payer to “permission” individual family members’ usage allowances, may be needed.
*  Revenue-share: Fixed operators do not generally collect payments on the part of 3rd-party content owners or service providers (except for interconnect), whereas mobile operators usually “own” the overall bill and conduct direct revenue-share among the various participants in their “ecosystem”.
*  Separation of Support and Control: Customers’ interfaces with their operators differ between fixed and mobile. Integrating these into centralised FMC functions, perhaps spanning multiple providers, raises significant issues around authorisation, provisioning and fault management.

Architectural battle

Having asserted that billing and associated OSS (Operational Support Systems) 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. Already, it seems likely that something of architectural battle is brewing, between the IN (Intelligent Networks) and traditional billing/OSS camps in enabling this type of flexibility.

The 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 may end up being more “IT-centric” or more “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 nderlying 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 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.

In all, though a customer-centric approach is preferable — the late adoption of network to open APIs such as OSA/Parlay and Diameter will make pure customer-centric solutions difficult to achieve. Similarly, the current network-based approaches provide insufficient customer lifecycle management. A hybrid approach — best of both worlds — will best meet the needs driven by fixed mobile convergence.

Conversely, the types of content-oriented service described above (eg FMC gaming 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.
The number of “starting points” for an average FMC customer, in terms of existing service contracts, legacy CPE equipment and individual usage modes, budget and payment preferences, is likely to make it difficult for operators to create “standard” packages and service bundles. Some customers may want a single bill, while others’ preferences (or the regulators’) may mean multiple ones are necessary.

Furthermore, given the traditional differences between fixed and mobile operational, billing and tariffing approaches discussed above, FMC offerings will need a long period of evolution and trial, before a particular structure can be safely “enshrined” in the network.

Lastly, the complex multi-operator FMC value chains will place 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 will be driven by the ability to negotiate favourable contracts with “suppliers” and the ability for software infrastructure to support and bill for those contracts appropriately. Security authentication and service authorisation across networks or operators may also be a difficult test for the network-centric approach.

Customer self-service

When one considers the already bewildering number of permutations and options for a typical single-user mobile phone tariff, the notion of easily-accessible and packaged FMC offerings starts to appear ridiculous. Instead, it seems probable that ‘menus’ of service components will be needed. Using the web, to provide an FMC customer with the equivalent of an online retailer’s storefront, is likely to be a good analogy of the type of interface required.

This would allow the customer to self-manage his or her family’s (or company’s) services in great detail. A manager could have visibility of a salesman’s overall time spent speaking to clients, across both fixed and mobile networks, and temporarily permit expensive cellular data roaming and WiFi access, during a critical customer conference abroad.
 
Perhaps even more compelling is the use of this type of customer-facing system to deal with support queries. It is highly probable that many early FMC offerings will fall down on technical calls from customers, that their existing agents and processes are ill-equipped to deal with. Diagnosis of problems that might involve a corporate customer’s internal IT department and network may generate more acrimonious bouts of finger-pointing and blame-deflection. While a web-based troubleshooting or fault-reporting system will not solve all these problems, it may reduce the cost of customer support, which is likely to be substantially higher for FMC services than traditional, better-understood offerings.

DIY FMC

The performance of operators in marketing, billing, and supporting FMC services has another dimension.

Over the last 10 years, the advent of the public Internet and dedicated corporate IP networks has reduced some of the value of fixed operator-provided services. Core voice traffic has started to move to VoIP, often as a “user-owned” application or from 3rd-party competing service providers.

Meanwhile, cellular operators have generally been able to keep control of applications, either by “owning” them directly, or at least controlling gateways to 3rd-parties. This, coupled with the acceptance of “paid-for” network-resident services like SMS, has enabled profitability, and a limit to the risks of commoditisation and value-erosion.

As IP capabilities appear in the mobile domain, a major challenge for operators will be to maintain control of services and applications. It will be theoretically possible for customers to bypass their operators and build/buy their own FMC applications. The availability of powerful smartphones and PCs, coupled with Internet-centric software will facilitate arbitrage. Mobile SIP may accelerate the type of commoditisation of voice services seen in the fixed/Internet world, especially through VoIP providers like Vonage, or “free” VoIP services like Skype.

Put simply, whoever controls the most valuable aspects of an IP communications system (i.e. the routing, switching, security and network-resident applications) will gain the most economic benefit.

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 will need to deliver customers far greater value in terms of application packaging, service and convenience. Billing and customer-centric capabilities will come to the fore.

Andy Singer is general manager of Radio Waves, a company that offers a diverse range of microwave antennas, from dedicated point-to-multipoint fixed wireless networks to point-to-point microwave links providing backhaul for mobile operators.

Recently the company has opened a manufacturing facility in the UK to bring it closer to the European market, which Singer views as a natural market for Radio Waves’ technically innovative and highly specified designs. Keith Dyer got the lowdown on this antenna manufacturer that is competing on quality and reliability, rather than merely on cost.

Mobile Europe:
Andy, first of all, many readers may not be aware of Radio Waves’ company background, and why you are keen to bring an enhanced European focus to Radio Waves.

Andy Singer:
Absolutely. Radio Waves is in some ways very lucky, because we have only one focus, and that is on the design, manufacture and marketing of microwave antenna systems. We eat, sleep and breathe it — it’s all we do.

We were founded in the early 1980s and, historically, we came out of being a traditional niche player in the news-gathering marketplace. Then came the tech crash and after that we took our technologies into point-to-point and point-to-multipoint microwave antennas. Since that point we have expanded rapidly and grown a huge focus in that area, which means that we can build products faster and better than our competitors who have more of a general approach. We supply high-quality, competitively priced microwave antennas for unlicensed ISM & UNII bands, Wi-Fi, MMDS (2.5 & 3.5 GHz), LMDS, point-to-multipoint and point-to-point microwave applications.

Mobile Europe: So, what has that focus delivered in terms of your product portfolio?

AS:
We design and manufacture microwave antennas covering frequency bands from 1.3 to 60GHz. We have standard parabolic or flat panel antennas for point- to-point and point-to-multipoint deployment. Our Xcelerator-® product line offers the best quality and performance of any 5 GHz flat panel antenna, and our ProLine point-to-point standard parabolic and high performance series antennas give coverage from 2-640 GHz for terrestrial microwave point-to-point applications, including the interconnection of GSM and cellular base stations. Then there are the millimeter microwave LMDS type horn antennas in which we have taken a market lead, globally. We are also responsible for making some associated equipment, such as cables, LMR jumpers, flextwist and most recently our own design of hot standby couplers.

Mobile Europe: It’s an extremely technical field but could you point out some areas in which your focus on design has given you a clear technical advantage?

AS:
A principal example might be our development of the hybrid Cassegrain Feed System, a more efficient feed system which uses a sub-reflector type feed for high frequency MW antennas. A typical antenna utilises a rectangular waveguide feed system, sometimes called a buttonhook feed. This can mean an antenna which has poor sidelobe performance. In other words, its performance is degraded. A hybrid Cassegrain system is more efficient in that it gives a lower antenna profile and improved pattern performance. Radio Waves was the first to develop that.

An example of the advantage the hybrid Cassegrain can give us is our Discriminator-â„¢ antenna. The Discriminator is a one foot dish, moulded out of plastic with a reflective coating, that delivers the side lobe performance of a two foot dish. We optimised the shape of a parabolic reflector by letting software determine the best shape, giving us Category A performance in a one foot dish.

It’s something operators find very exciting because they can cut back on the need for large antennas.

Mobile Europe:
Talking of operators, how important a part of their operations would you say microwave is, and do you see its importance growing?

AS:
Clearly the biggest single opportunity for us with mobile operators is for cellular backhaul systems — either from base station site to base station site or from base station site to the mobile switching centre.

Here their networks are really built on microwave. Whether you are talking about the introduction of UMTS/ EDGE or1xEVDO networks, whatever the technology, operators want to drive users to increase their call minutes and data usage. And technology is allowing them to do more and more all the time. I’m talking about the introduction of Mega pixel camera phones, of video and music players on phones and so on. So it’s going to be all about the bandwidth from site to site — and think how clogged they will be when all of this happens. The only answer is more and bigger pipes, and that means either fibre, or E1 connections, or Microwave. Even if there is equivalent growth in the other methods, Microwave will grow anyway because of the need to increase pipes so much. It’s exciting to be a part of that.

Mobile Europe:
There’s a view that Microwave links are more efficient comparatively in less developed networks and economies because there is not as much fibre as in more developed countries. Would you agree?

AS:
You could say it’s even more likely in rural or developing countries where there is not as much easy access to fibre. But there are other reasons for the deployment of Microwave — for instance to do with managing expenditure. Fibre and E1 connections are both about leasing, but you can buy your own Microwave systems. So opex is down and you can also attach a ROI to your capital investment in the network.

Mobile Europe:
So. given the opportunity, what are your routes to exploit it?

AS:
We have three main channels. One is through OEM microwave radio manufacturers. For example, Stratex Networks provides a turnkey approach to operator customers. They buy antennas from Radio Wave and sell them as part of a system to end users. Stratex Networks is a large OEM customer and someone we think does a very good job with Eclipse — the first software definable capacity radio — and they started a trend with that. In the 5 GHz unlicensed area we also work with Aperto Networks, who have been very successful because they can offer relatively high capacity even though it’s in an unlicensed band.

Our second route is distributors and value added resellers, in which an important area for us will be establishing relationships with suppliers who appreciate the value our systems can add to their customers’ own businesses. We provide training to our VARs, and currently have a number of them through the EMEA region, including the UK and Russia.

The third is going direct to market, like we do with some cellular operators. Some of them like a relationship with a turnkey provider, and others feel they get savings by doing it themselves.

Mobile Europe:
What has been the motivation behind the establishment — and now I understand the expansion — of your UK manufacturing plant, based in North London.

AS:
Our UK manufacturing plant was something we attempted to do about two years ago. Then we began to get serious a little over a year ago. The primary reason behind it is that the growth in the last few months has been significant. If we had the ability to manufacture and ship to customers on a more local basis, we knew that  customers would really appreciate this.

It is easier logistically and financially for them and us compared to shipping equipment out on a boat from half way round the world. Many suppliers have six to eight week manufacturing lead times and we can now do two to three weeks for customers in the territory. So the primary reason for the UK plant was to allow for very efficient delivery whilst keeping our high quality standards of manufacture.

Mobile Europe:
You mentioned sales growth. What level of growth have you been experiencing, and what are the competitive pressures you face?

AS:
Our sales growth has meant that we have expanded to twice our previous headcount in 18 months, bringing us up to 85 people. But it is still a competitive environment.

One of the different things has been in pricing of raw materials. There has been a spike in demand globally, and steel and aluminium costs have rocketed.  We have seen a 50% and 25% increase in those two raw materials respectively — and that is against a background where telecoms equipment prices have been very competitive.
 
But this is relatively new — business has increased significantly recently and we have increased our market share.

Mobile Europe:
What do you think are the reasons for that growth — both in shares and in market share?

AS:
The reason for our growth is the higher level of service and the quality and reliability of our products.

We have heard some horror stories about the other manufacturers’ products which have been shipped to customers. Our manufacturing system allows us to provide a very high level of service to our customers. They really appreciate that.

When you are talking about major group operators our customers are looking for that higher level of service.

Something that is underexposed is ease of installation. If there is less assembly work at the site, and a Radio Wave antenna is simpler to install — what’s that worth? Again, it is the same for maintenance costs. So by simplifying our design that is something we offer the marketplace in both those areas.

There has also been global consolidation of operators and most operators have developed groups at corporate HQ to review products and develop rigorous specifications. We’re really in favour of that because we do have solutions with excellent specifications. So we can meet their needs, whereas producers at lower costs may not be approved.  We see more of that happening and also  OEMs need to have a very vigorous approval process.

A Radio Waves antenna goes on the tower and it stays on the tower, and continues to perform and deliver consumer satisfaction for our customers and our customers’ customers.