LTE: opportunities and impact on operators

About LTE:

LTE is an acronym for Long Term Evolution, it is a 4G wireless communications standard developed by the 3rd Generation Partnership Project (3GPP) that is designed to provide upto 10 times the speeds of 3G networks for mobile devices such as smartphones , tablets and wireless hotspots. 4G technologies are designed to provide IP-based voice, data and multimedia streaming at speeds of at least 100 Mbit/sec and up to as fast as 1 GBit/sec. It is basically dealing with much more high speed than one would have expected. For example: while downloading, a movie gets downloaded in just one second...that is the speed they are provided by the operators.

The first commercial LTE networks were launched by TeliaSonera in Norway and Sweden in December 2009; as of 2012, there were 117 commercial LTE networks in various stages of commercial service. But, the plan is for 130 LTE deployments by the end of 2013 or in start-ups of 2014.

Opportunities and Impact on Operators:

As per recent stats new Long Term Evolution (LTE) mobile phones and proclamations of unsurpassed network speeds, Mobile Network Operators (MNOs) are invested heavily in the role. As LTE will play in their future competitiveness. LTE network rollouts are underway at various stages in major U.S. and global markets, so as per this the time is now for MNOs to monetize these investments by delivering new, innovative advanced communications services alongside voice to enterprise end-users and consumers.

According to research firm Informa  70% of global operators believe 4G services should be launched everywhere by 2013. The sense of urgency is not simply perceived but very real, resulting from a small but closing window of opportunity for MNOs to be the provider of choice when it comes to delivering unified communications services – including mobile video calling, instant messaging and presence, and Web collaboration – to customers. Top players such as Apple and Google are chomping at the bit to seize mobile subscribers and revenues, while the increasingly mobile workforce now demands a consumer-grade communications experience that matches what they have come to expect on their tablet, iPhone, Android and BlackBerry devices.

The ability of MNOs to capitalize on this opportunity will go a long way toward shaping the future of mobile broadband communications, including but not limited to what services are available to enterprise end users and consumers, who delivers these services and, of course, what customers will have to pay for these services. A better word than capitalize is monetize. Mobile operators must start the process of monetizing LTE today.

In all markets, LTE subscribers used significantly more mobile data than 3G subscribers. Specifically, in Korea and Japan, markets often used as leading indicators of mobile trends. At the same time, decreases in relative Wi-Fi usage in all markets were also noted and Korea registered an absolute decrease. While Wi-Fi usage is still very significant, the data points to a possible trend towards a decrease in reliance, suggesting an opportunity for LTE operators. LTE operators' strategy to reset pricing plans during the transition to 4G appears to be working. Various survey by mobidia’s data shows significant decreases in unlimited plans and increases in larger-sized, volume-limited plans. As an example, only seven percent of LTE subscribers are using unlimited plans compared to 24 percent of 3G subscribers. Additionally, the percentage of subscribers on 2G or higher plans increased from only 10 percent of 3G subscribers to 62 percent of LTE subscribers. So, to conclude the impact is severe at present on operators but the future is hopeful and operators can invest in this technology.

Vivek Chaturvedi

Class of 2015

The Connected World

Over just a few decades, mobile communication has become one of the largest and most significant platforms, with six billion connections and transforming the way we communicate and access information, entertainment and the internet. Now, a new wave of connectivity is on the horizon where everyone and everything around us that might benefit from a wireless connection . We are about to see connected cars, buildings, medical monitors, TVs, game consoles and a whole range of connected consumer electronics and household appliances. Many of these will be connected wirelessly and intelligently, communicating and interacting with each other, thereby creating the connected life. Beyond connectivity, mobile operators will play a crucial role in working together with a range of industry partners in health, automotive, education, smart cities and a range of vertical industries to accelerate the launch of valuable connected services.

Mobile networks play a pivotal role in the development of the connected life providing a scalable, standardized global platform to support the growing demand for intelligent, secure connectivity. New connected wireless devices are set to surpass the number of mobile handsets over the coming decade and create significant new business opportunities for mobile operators, vendors and industry partners. Machine research estimates that by 2017, there will be over 10 billion cellular connections . Almost half the population of the earth now uses mobile communications.

A billion mobile subscribers were added in the last 4 years to leave the total standing at 3.2 billion. There are still many adults and young people who would appreciate the social and economic benefits of mobile technology but are unable to access it, highlighting a huge opportunity for future growth and a challenge to all players in the industry ecosystem to expand the scope of products and services to tap this demand. Despite challenging economic headwinds in many regions, the market is expected to grow even more strongly on the dimension of connections over the next five years, with 3 billion additional connections expected to be added between 2012 and 2017, a growth rate of 7.6% p.a. Given this dynamism, it is no surprise that the mobile industry makes a substantial economic contribution, with mobile operators alone expected to contribute 1.4% to global GDP in 2012 and their revenues expected to grow at a robust 2.3% p.a. to reach US$1.1 trillion by 2017.

Mobile infrastructure is now as important to a country’s economy as its energy grid or transportation network – it is a key enabling infrastructure that drives and supports growth in the wider economy. The high level of investment is needed to continue the development of this infrastructure so that capacity can be built to meet the ever growing demand and so that new services can be launched which bring greater benefits to the wider economy . Emerging markets are the major engines of mobile connection and subscriber growth – in particular Asia Pacific will add nearly half of all new connections between now and 2017 (1.4 billion) .

Network operators are continuing to develop strong value propositions to deliver new and innovative services to users. As technology continues to evolve, so the mobile ecosystem has built new business models to deliver new services in communications and adjacent services. Mobile remains a vibrant and evolving industry constantly finding new ways to inter-connect the user’s world in spheres such as automotive, utilities, health and education, and new ways to manage financial transactions. In emerging markets, growth will be driven by the increased penetration of smart phones, while in developed markets it will be driven by both greater Smartphone adoption and increased download speeds made possible by new technology such as 4G .The mobile industry has always made a significant contribution to public funding. By 2017, its contribution to public funding is projected to be US$550 billion – as a result of spectrum fees as well as direct and indirect taxes. It is important that this level of financial commitment should be structured in a fair and predictable manner, in order to protect growth and employment.

As quoted by Douglas Adams “First we thought the PC was a calculator. Then we found out how to turn numbers into letters with ASCII — and we thought it was a typewriter. Then we discovered graphics, and we thought it was a television. With the World Wide Web, we've realized it's a brochure.”  but before you become too entranced with gorgeous gadgets and mesmerizing video displays, let me remind you that information is not knowledge, knowledge is not wisdom, and wisdom is not foresight. Each grows out of the other, and we need them all. Today our very survival depends on our ability to stay awake, to adjust to new ideas, to remain vigilant and to face the challenge of change. The large house in which we live demands that we transform this world-wide neighborhood into a world – wide brotherhood. Together we must learn to live as brothers or together we will be forced to perish as fools.

Aditya Basu

Class of 2014