Optus Pioneers 3X Carrier Aggregation for LTE, Delivering Speeds up to 317 Mbps

Australian mobile operator Optus has become the first telecommunications provider in the world to aggregate three different frequency bands, using both frequency division and time division multiplexing to support its fourth generation Long Term Evolution services.

The Optus “3x Carrier Aggregation” (3x CA) system combines 1x FDD and 2x TDD1 formats to supply the Newcastle NSW suburbs of Lambton, Mayfield and Mayfield West.

The move means Optus customers with the latest LTE category 9 smartphones, such as the Samsung Galaxy S6 edge+ and Samsung Galaxy Note 5, will experience speeds as high as 317 Mbps.

“We plan to switch on 3x CA technology in the Melbourne CBD in early September and roll out to the Sydney CBD early next year, followed by the Brisbane and Adelaide CBDs from mid-2016,” said Dennis Wong, Acting Managing Director Optus Networks.

TV White Spaces Inches Closer, In India and United States

Global technology giant Microsoft will be working with the Andhra Pradesh government on a TV white spaces pilot project providing four schools in Srikakulam with Internet access.

As a part of the project, the Z.P. High School will act as the base station, while three other campuses would be receivers and will be located at a distance of 10 km or more from the base station.

Wi-Fi has a range of only about 100 meters, whereas the 200-300 MHz spectrum band available in the white space can reach up to 10 kms, making TV white spaces a new way to provide Internet access, without using licensed spectrum.

TV white spaces also moved a bit closer to reality in the United States as the Federal Communications Commission issued new rules on the upcoming 600-MHz spectrum auctions that will enable TV white spaces nationwide, creating technical rules for use of the duplex gap, guard bands, 600 MHz service band and channel 37.

As always, where it comes to license-exempt spectrum, concern about interference issues is a reason for concern. It also is fair to note that such expressed concerns also represent contestant business issues.

Where entities that benefit from use of licensed spectrum will express concerns about interference from additional license-exempt services, so entities that benefit from license-exempt spectrum will raise issues about potential interference from licensed entities.

Precisely how much TV white spaces spectrum will be available in any specific market will vary. But TV white spaces potentially can be used in channels 14 to 20. In principle, that means more than 50 MHz of new spectrum could be made available for TV white spaces.

LTE Devices Were 58% of Global Smartphone Sales in 2Q 2015

Fourth generation Long Term Evolution network smartphones represented 58 percent of global smartphone sales in the second quarter of 2015, up from 26 percent in the second quarter of 2014, according to research firm GfK.

LTE-based smartphone unit growth was 129 percent year over year.

"India is expected to be the largest contributor of absolute smartphone unit growth globally this year,” said Kevin Walsh, GfL director of trends and forecasting.

In the second quarter of 2015, smartphone sales value grew eight percent over last year while unit sales grew by six percent.

In China, high-end device demand increased 49 percent year over year in the second quarter of  2015, though overall LTE device sales fell 10 percent.

Unified Wi-Fi, Mobile, Satellite Backhual Using Millimeter Waves?

It increasingly is clear that 5G and low earth satellite technologies are intimately related, as are core networks based on network functions virtualization and access-agnostic edge networks, fixed and mobile networks generally.

As a new paper by Samsung Electronics suggests, mobile 5G and LEOs might both take advantage of millimeter wave frequencies, with the LEOS serving as backhaul for mobile transmitters or direct enterprise backhaul links.

If a unified millimeter wave set of networks (satellite, mobile, Wi-Fi) can be created, small cell networks would be essential. But that might be easier than at present, since Wi-Fi nodes directly served by LEO constellations would be possible.

Think of the present village kiosk, served by a geostationary satellite and then distributing signal using Wi-Fi, and you'll get the concept.

If, in fact, bandwidth increases by an order of magnitude (10 times) about every five years, LEO constellations might be among the few viable backhaul mechanisms able to supply that amount of new capacity, at low cost, in developing regions.

No Surprise: Study Finds Churn is Related to Device Customer Service

You likely would not be surprised to learn there is a link between customer churn and user experience with their devices, as well as a link between perceived poor customer or repair service.

A 2015 Ovum study found that poor customer experience around phone problems can increase churn when customers blame phone problems or poor repair service on the operator or retailer, according to Stas Wolk, Cellebrite VP.

According to the study, which surveyed 4,000 smartphone users across four countries, 14 percent of respondents said that they would look into purchasing their next handsets through different providers, based on their malfunction experience.

This number increased to 18 percent among customers who sought help for issues with decreasing software speed, Wolk says. And nearly 70 percent of smartphone users report having experienced device issues in the past year.  

Of those users who plan to switch providers following dissatisfaction with operators’ repair services, 25 percent cited customer service as a top three reason for churn.

Unreported problems can be an equally big problem, over time. When asked who they first turned to for help after discovering a smartphone problem, 28 percent of consumer respondents said they turned to no one and continued to use the phone as it was.

Some 33 percent of respondents, who encountered problems after the warranty on the device expired, reported they did not report the issues to their carrier.

The service provider, more than any other single contributor in the ecosystem, is going to take most of the direct impact of service activity related to use of the devices, whether that is “fair” or not.

A revamped customer service experience could capture those 14 percent  to 18 percent of customers at risk of switching to a different provider, while bolstering loyalty among the rest of an operator’s existing customer base.

Consumers prefer the convenience and immediate results of easy and effective self-serve solutions.

Of all possible repair channels, 79 percent of customer respondents said they would “definitely” or “likely” use a self-service solution to solve their smartphone malfunction woes. In comparison, 68 percent responded that they would likely resort to in-store service, and 67 percent would opt for online service.

Is 5G a Breakthrough in Combating "Dumb Pipe" Problem?

The “access” network traditionally has been--and remains--a way for users to get access to communication features provided by the core network. That feature of access networks does not change with the advent of fifth generation networks.

What might be quite new--if anticipated new applications are enabled as many believe--is that the 5G network will be the first access network whose value, features and business models are shaped and determined by the core networks in a new way.

For service providers concerned about “dumb pipe” and “low value commodity services,” 5G could be a breakthrough.

It is more than a breakthrough in mobile access network speeds that make mobile access a full substitute for fixed access, for the first time. Access speeds between a gigabit per second and 10 Gbps represent the biggest breakthrough in mobile access network capacity, ever.

That might not be the most-important change, though. Traditional core networks provided differentiated services for business customers. But 5G might be the first network to enable differentiated services for consumers, appliances and sensor networks.

In fact, it might be feasible to build custom networks--tuned or optimized for particular applications, using a single, unified network, not an overlay--at prices the end users and networks can afford to buy.

You might say the access network features become a richer part of the core network. That has potentially significant implications for the threat of “dumb network” status.

To be sure, access networks traditionally have been “dumb pipes” giving users connections to value provided by the core networks.

That will continue to be true for 5G and future network generations. What is new is the degree to which the access network will be recreated as a platform for differentiated services.

If regulators do not get in the way, that is a big deal.

Telecom Services are Digital Products, With "Digital" Economics

There it is, again: marginal cost pricing. “Carriers have already sunk a lot of expense into 4G LTE network upgrades (including purchasing spectrum licenses), and now the biggest portions of these costs have been paid,” argues Glenn Fleishman, Macworld senior contributor.

There is room for debate about about the financial truth of that notion.

Capital has been invested. The networks are built out and operating, and there are scores of millions of customers loaded onto those networks.

Whether the mobile carriers have yet recouped all of the invested capital might be a subject of some debate.

But it certainly is true that the cash spent to build out the networks is generating recurring service fee revenue. And, as Fleishman notes, “ their network infrastructures have been largely built out, and their current costs won’t increase much with additional customers or data usage.”

So what will service providers do to take customers from other providers? To the extent possible, they will price not at full “recovery of capital” levels, but on the incremental cost of serving the next customer.

Such marginal cost pricing happens in markets for digital products. And communication services are digital products, subject to all the economies any other digital application experiences.

So pricing will trend, over time, towards marginal cost. And what is the marginal cost of the next message, the next phone call, the next megabyte of usage? A number so small it is hard to measure. Or, as I call it, “near zero” pricing levels.

As always is the case, “price” and “cost” are different things! So the retail price might not actually reflect “cost” so closely. But the actual marginal cost of the next unit is quite literally “near zero.”

So something more than “mere competition” is at work here. The structural reality is that a digital product’s retail price trends towards zero.

That is the long-term structural reality of telecom service pricing.