In Gigabit Era, Fixed and Mobile Networks Will Reach 10 Gbps Per Device

With gigabit Internet access speeds now shaping the context of the consumer Internet access market, it also should be acknowledged that current development work, historical precedent and competitive markets already suggest that multi-gigabit speeds up to 10 Gbps already are on the standards agenda and product roadmaps for both fixed and wireless networks.

At a time when consumers actually do not have access to applications that require a gigabit, much less 10 Gbps, that might seem an example of pure marketing hyperbole.

What might be shocking is that history suggests 10 Gbps is precisely where we should expect bandwidth to go.

Basically, since the time of dial-up access, we have seen linear increases in bandwidth that very much resemble Moore’s Law. Indeed, some even argue that Internet access bandwidth, in terms of the top marketed speeds for consumers, have increased precisely as Moore’s Law would suggest computing power grows.

What will likely come as a bigger surprise is the improvements we will see with 5G and future mobile generations, where mobile or fixed wireless speeds will reach gigabit ranges (one Gbps up to 10 Gbps) as part of the standards.

source: Arris

source: Cablelabs

Precisely how all that bandwidth can be provided at prices regular consumers are willing to pay is the issue.

And that is why any number of development initiatives, mobile and fixed, are key. Basically, all the efforts aim to supply gigabit bandwidth on networks that are efficient enough to support consumer price points.

In that regard, much attention now is going into fixed wireless.

AT&T, for example,  is working on “AirGig,” a method for combining fixed wireless with power line transmission for communications, without building towers, laying cables or acquiring new spectrum.

All three of those attributes have the potential to dramatically lower the cost of delivering gigabit services in the access network.

AT&T’s Project AirGig has several key advantages:

• Easier to deploy than fiber
• Uses license-free spectrum
• No need to deploy towers, dig trenches or connect cables

At&T expects to conduct field trials in 2017.

Combined with the dominant role of cable TV networks in the access network, and the upgrades to gigabit speeds, serious questions can be asked about whether fiber to the home will continue to be viewed as the “best” way to deliver gigabit Internet access and other services to consumers.

“Project AirGig has tremendous potential to transform internet access globally, well beyond our current broadband footprint and not just in the United States,” said John Donovan, AT&T chief strategy officer.

AT&T says it has more than 100 patents or patent applications supporting this new technology and other access technologies.

source: AT&T

“We’re experimenting with multiple ways to send a modulated radio signal around or near medium-voltage power lines,” said Donovan. “There’s no direct electrical connection to the power line required and it has the potential of multi-gigabit speeds in urban, rural and underserved parts of the world.”

Project AirGig is therefore one more potential platform for Internet access and communications that uses fixed wireless.

As part of Project AirGig, AT&T Labs invented low-cost plastic antennas and devices located along the power line to re-generate millimeter wave (mmWave) signals that can be used for 4G LTE and 5G multi-gigabit mobile and fixed deployments.

“These patent-pending devices can mean low hardware and deployment costs while maintaining the highest signal quality,” said Donovan.

Also,  5G standards will include multi-gigabit speeds, and the cable TV industry already envisions 10 Gbps service. Nokia already has demonstrated 10 Gbps symmetrical speeds on hybrid fiber coax, supporting the CableLabs “full duplex” version of DOCSIS 3.1.

All that illustrates a principle: advertised Internet speeds are mostly about marketing, at this point, not “need.” The clearest use case for most accounts is that multiple users in a family or household watch lots of high-definition format streaming video simultaneously.

Generously allocating 10 Mbps per stream would mean a need for 70 Mbps for seven simultaneous HDTV streams.

Some users running servers out of their homes plausibly need similar levels of bandwidth. But the average consumer arguably needs nowhere near 100 Mbps.

A reasonable 2015 analysis of functional need, per user, might have looked something like this:

• 5 Mbps or less: Basic web surfing and email
• 5-10 Mbps: Web surfing, email, occasional streaming and online gaming with few connected devices
• 10-25 Mbps: Moderate HD streaming, online gaming and downloading with a moderate number of connected devices
• 25-40 Mbps: Heavy HD streaming, online gaming and downloading with a lot of connected devices
• 40+ Mbps: Hardcore streaming, gaming, and downloading with an extreme number of connected devices.

The fundamental point is that we now are in a phase of development where end user need does not drive bandwidth growth. Suppliers and apps are pushing the trends.

1/3 of Telco Execs Ponder Moves "Up the Stack" into Applications

There are very good reasons why global telecom executives are looking for a range of new revenue generators: the legacy revenue streams are shrinking.

Over the past several years, the telecom business has entered a period of slow decline, with revenue growth down from 4.5 percent to four percent, EBITDA margins down from 25 percent to 17 percent, and cash-flow margins down from 15.6 percent to eight percent, say Paul-Louis Caylar and Alexandre Ménard, McKinsey partners.

Among U.S. telecom companies, landline and mobile voice now account for less than a third of total revenues, down from 55 percent in 2010.

Over the last half decade, mobile data revenue growth has offset the losses in voice and messaging. Mobile data, in fact, now represents 65 percent of total revenues. In 2010, mobile data represented just 25 percent of total revenues.

A third of the 104 respondents to a 2015 McKinsey survey of senior industry leaders said they were preparing to move into adjacent businesses such as financial services, information technology services, media, or utilities in search of new opportunities and revenue streams, McKinsey says.

With the possible exception of media services, most of the opportunities seem to involve Internet of Things to a great extent.

By 2025, as Few as 110 Telecom Service Providers Could Still be in Business

Eventually, the world will have about 10 global-scale telecom providers, with about 100 local network service providers, where today there are perhaps 800 service providers, according to Bell Labs.

Scale always has mattered, but hyperscale arguably matters even more as the world shifts to cloud-based, ultra-high-bandwidth, ultra-low-latency networking literally connecting almost everything.

One reason scale might matter is that investment in state-of-the-art networks will produce capacity 66 times greater than today, by about 2025. The amount of data each person has stored in the cloud will grow by about 20 times.

Local access speeds on fixed networks will grow by perhaps 100 times by 2025, up from perhaps 100 Mbps today to 10 Gbps by 2025.

Radio improvements (multiple input, multiple output) will be something on the order of 250 times today’s performance, by 2025.

source: Bell Labs

India Mobile Market Share Rearranged with Reliance Communications-Aircel Merger

The consolidation of India’s mobile market has taken a big step as Reliance Communications and Aircel are merging their businesses.

The combined entity will have 187.64 million subscribers, creating a new number-three mobile business behind Bharti Airtel Ltd (255.7 million) and Vodafone India Ltd (199.4 million). Until the merger, Idea had been the number-three provider.

The merger vaults the new company into the “top-four” ranks, creating significant separation between the fifth and all other smaller providers.

Nobody yet knows what further changes will occur as Reliance Jio enters the market, either.

source: Telecom Lead

Can Regulators Boost Internet Access Speeds by Enabling Cable TV Competition?

source: Ofcom

With the caveat that there are many institutional and historical processes at work, one supply-side policy communications regulators can implement--or should have implemented--is legalizing and aggressively supporting deployment of cable TV networks.

That appears to lead not only to more competition in a market, but also seems to lead to higher overall Internet access speeds.

Likewise, one demand-side development that has helped spur speed upgrades, as well as deployment footprint, is the triple-play bundle pioneered by cable TV companies.

Such are the conclusions one might draw from recent Internet speed tests in the United Kingdom, where Virgin Media, if not ubiquitous, passes about 44 percent of U.K. homes.

One data point: a recent speed test shows Virgin Media providing the fastest downstream speeds, compared to Internet service providers using the BT wholesale network.

In those tests, Virgin Media speeds in the 7 a.m. to 3 p.m. portion of the day were 79 percent faster than BT’s speeds in the same time period, using one test methodology.

In another test, Virgin Media was more than twice as fast as BT in the 7 a.m. time period.

In the 6 p.m. to 3 p.m. period, Virgin Media was either 46 percent faster or twice as fast, depending on test method.

Peak and Off-Peak Download Speed Tests Results September 2016
Provider	tbbx1 Test (1 download)			httpx6 Test (6 downloads)
	7am-3pm	6pm-midnight	% difference	7am-3pm	6pm-midnight	% difference
BT	24.8 Mbps	23.9 Mbps	-3.8%	21.8 Mbps	21.2 Mbps	-2.8%
EE	14.2 Mbps	13.2 Mbps	-7.6%	14.4 Mbps	13.6 Mbps	-5.9%
Plusnet	23 Mbps	21.6 Mbps	-6.5%	18.7 Mbps	18.5 Mbps	-1.1%
Sky	15.3 Mbps	14 Mbps	-9.3%	13.9 Mbps	12.5 Mbps	-11.2%
TalkTalk	14.7 Mbps	13.1 Mbps	-12.2%	13.8 Mbps	13.3 Mbps	-3.8%
Virgin Media	44.6 Mbps	34.9 Mbps	-27.8%	52.6 Mbps	44.5 Mbps	-18.2%

source: Think Broadband

Software Will be Biggest Revenue Driver in 2030 Autonomous Vehicle Ecosystem

Software will be the biggest autonomous vehicle value chain winner, with $25 billion in revenues in 2030, a 28 percent compound annual growth rate, according to Lux Research. By that point it is possible autonomous vehicle ecosystem revenues could reach $87 billion.

Optical cameras and radar sensors will amount to $8.7 billion and $5.9 billion opportunities in 2020, respectively. By perhaps  2030 computers will be biggest hardware opportunity on-board autonomous cars, amounting to a $13 billion opportunity.

Ironically, some industries will be severely disrupted. Uber drivers, for example, will be replaced by autonomous vehicles. Auto sales should decline, as more people forego car ownership.

And insurance sales volume could drop as much as 80 percent, according to KPMG and Deloitte.  

source: Lux Research

source: Business Insider

DSRC or 5G?

It is not yet clear whether autonomous car communications (vehicle-to-vehicle and vehicle-to-infrastructure) will use 5G networks or dedicated short range communications (DSRC).

Indeed, it is likely some applications will make more sense for one or other other of the two methods, while yet other connection platforms also are used, as well.

But it is clear that the stakes are quite high for mobile operators, as revenue growth premised on ever-growing subscriptions for mobile data, plus rising recurring payment streams, are close to saturated in some markets.

That means the industry already is searching for the next big driver of incremental revenues.

source: Business Intelligence

source: Visteon Electronics

According to analysts at Deloitte, we already are at the peak of the smartphone era. In fact, 2016 “will likely mark the end of the smartphone growth era, and the start of its consolidation,” Deloitte argues. “A mere nine years after the launch of the first full touchscreen smartphone, adoption is nearing a plateau, at 81 per cent of UK adults, and 91 per cent of 18–44 year olds.”

NCTA Kills its National Convention (Name Change Notwithstanding)

As someone who has spent about 30 years in and around telecom and cable TV industry events and media, I can attest that when events come and go, or media come and go, it tells you something about change in the industry.

For 65 years, U.S. cable TV executives have met annually at an event formerly known colloquially as “the national show.” That event in recent years was renamed INTX. But INTX now is going away, cancelled by the NCTA.

“We believe large trade show floors, dotted with exhibit booths and stilted schedules have become an anachronism,” said NCTA CEO Michael Powell.

Contemporary venues emphasize conversation, dialog, and more intimate opportunities to explore and interact with technology,” said Powell.

Left unsaid was that, over the past decade or two, it had become less important for buyers or sellers to be there. There simply were fewer buyers, so sellers could work with them directly. And anything of any importance already was known before any particular edition of a trade show. There was, in the colloquial, increasingly no news of any consequence.

Also, with the maturation of the business model, a convention once driven by programmers had become a venue mostly driven by technology firms. But there are other venues for technology.

Also, at a time when every part of the telecom business has become more competitive, and every segment is trying to wring costs out of its business, executives had to question whether the outcomes from spending money to attend that annual event were producing outcomes commensurate with investment.

At the same time, though it continues to use a technology platform that is specialized and distinct, cable TV operators now are part of the broader communications business. And there are lots of venues for that industry, nationally and globally.

As the global industry continues to consolidate, other segments of the industry are going to rationalize as well.

Effort, time and money spent “intra-industry” are less important than investments inter-industry, given the loosely-coupled nature of the communications ecosystem, which in turn has become part of the broader Internet ecosystem.

It has been a good 65-year run. But too many things have changed.

Korea Telecom Sees New Value from Fixed Network

Korea Telecom, like Verizon, now sees different strategic value for the fixed network. AT&T likely agrees, up to a point.

The stated upside for Korea Telecom fixed transport network capacity upgrades is said to be “home video, mobile broadband, and VIP leased lines.”

Consumer video includes support for bandwidth-intensive 4K video formats, but telco upgrades to fiber-to-home or fiber-to-node long have been premised on incremental video entertainment revenues. That is not especially new.

Nor would anyone find trunking network support for business and enterprise customers too surprising.

What is different is the use of the fixed network as backhaul for mobile broadband. Again, while mobile backhaul always has been key revenue driver for cell tower connections, coming small cell requirements represent a qualitative change.

It is one thing to support networks of macrocells. That fiber-to-tower market has been important for many service providers for some years.

Up to this point, in the U.S. market, there has been a need for backhaul to perhaps 300,000 macro cell sites in the United States and 200,000 towers. All that will change with new small cell overlay networks to support capacity upgrades for 4G and 5G networks.

Ignore for the moment potentially millions of enterprise small cells. Public networks in urban areas might be built out more extensively than anything seen before.

If in some urban areas the density is roughly “fiber to every other light pole,” That implies potentially millions of new backhaul sites to be supported.

That in turn will require dense fiber backhaul networks. So the new strategic value of the fixed network will extend beyond consumer video/broadband and enterprise/business connections to mobile small cell backhaul.

The additional incremental change is backhaul for fixed wireless small cells.

Cord Stackers More Satisfied Than Cord Cutters (No Surprise)

Almost by definition, consumers who like a product will buy more of it than consumers who do not like a particular product. So it is with entertainment video.

Overall satisfaction with paid streaming video service is highest among cord stackers who buy both linear and over the top video, and lowest among cord cutters, who, by definition, have abandoned linear video.

The latest J.D. Power study finds that although the number of customers who cut the cord on pay TV is growing, the majority of streaming video customers still purchase a linear TV service in addition to a streaming video service.

About 60 percent of streaming customers are cord stackers; 23 percent are cord shavers (those who still subscribe to TV but have downgraded their service package); 13 percent are cord cutters (those who have recently canceled TV service); and four percent are cord nevers (those who have never subscribed to pay TV and only subscribe to streaming video service).

Overall satisfaction is lowest among cord cutters, followed closely by cord nevers, while satisfaction is highest among cord stackers and cord shavers.

Connected Car Benefits for Insurers

Though some desired business outcomes from Internet of Things advances will reduce the cost of inputs such as energy, arguably the biggest benefits will come from direct impact on business models or policy outcomes (lower air pollution, less traffic, accidents avoided, equipment protected, lives saved).

IoT sensors, for example, could help insurance companies better assess risk, and therefore premiums, charged to its customers. That is one direct benefit of connected air applications.

Since the basis of the insurance model is risk arbitrage, IoT sensors would help in several ways, allowing companies to safely provide “safe driver” discounts, while better matching premiums to risk in other cases.

That is one reason connected car applications are seen as early adopters: there are advantages for drivers (safe drivers, at any rate) and insurance companies. When an innovation had tangible benefits for both buyers and sellers, adoption can occur faster, because there is less friction (inertia or resistance).

source: Business Insider

"Fiber to Home" Not Setting U.S. Internet Access Speed Agenda

With the caveat that the U.S. market is somewhat unusual in having robust fixed network competition on a facilities basis, it is hard to deny that cable TV operators now are setting the agenda for Internet speed upgrades.

A few years ago, one might have argued that Google Fiber was setting the agenda. A decade ago, you might have argued that Verizon’s FiOS was setting the bandwidth agenda.

These days, it is multi-gigabit services enabled by DOCSIS 3.1 that will likely set the commercial deployment agenda, given the ubiquity of cable TV networks across the country.

It is hard to tell at this point how important--or when--symmetrical bandwidth will become important for cable operators. At the moment, with some caveats, downstream bandwidth likely remains the key driver of marketplace positioning.

Downstream speed tends to be--with price--the way consumers evaluate offers, and downstream capacity grows at a 50 percent to 60 percent compound annual growth rate.

In the next wave of platform development, it seems likely that dramatic leaps in mobile (perhaps in small cell or fixed applications) will complement and possibly compete with fixed networks, to some extent. The new competition will center on multi-gigabit speeds, at a headline level.

Perhaps the more-important development is that mass-deployed bandwidth in the hundreds of megabits range will be widely available, from fixed and mobile networks.

For many veterans of the telecom industry, the notion that “fiber to the home” no longer sets the speed agenda will be shocking. The importance of physical media periodically shifts, so we might yet see another shift back to fiber access as protocols continue to advance.

source: Cablelabs