interview


Arun with a view

Ericsson's Arun Bhikshesvaran

Five years ago Ericsson counted only GSM players T-Mobile, AT&T and Rogers on its roster of North American clients. Today, due in part to attrition in the vendor community, the acquisition of Nortel’s infrastructure business and the coalescence of the CDMA community around the LTE standard, the Swedish firm has a market leading position in the US, with kit and deals in place at all the tier one carriers, and many of the following pack.

Because of its sheer size, and its early migration to LTE, the US market is now of vital importance to Ericsson. The firm now has 14,000 staff in the US, just 5,000 fewer than in its native Sweden and has relocated its CTO, Håkan Eriksson, to Silicon Valley. Back at the end of the last century Ericsson was at the forefront of the a technology divide between Europe and the US that, at times descended into open hostility; today things couldn’t be more different.

Arun Bhikshesvaran, Ericsson’s VP for strategy and market development in the US, believes that the country will remain one of the world’s three most advanced markets for some time to come, along with Japan and South Korea. Good access to broadband, fixed and mobile, and a culture of early adoption will keep these three markets in a state of equilibrium at the vanguard of the industry, he says. Each is likely to excel in different areas, though, and he suggests that it is in the device space where the US will stand out.

“The presence of Google, Apple and potentially HP with Palm is going to lend a lot of weight in the US,” he tells Telecoms.com during Ericsson’s Business Innovation Forum event in Silicon Valley in May. “The combination of the OS and the device is something we have yet to find anywhere else, apart from RIM in Canada, perhaps. All the other vendors are working on somebody else’s OS, or somebody else’s device. Even Nokia is working on Microsoft now. So you have a unique combination here in the US and that leads the rest of the world.”

The other area in which the US is among the leaders, of course, is in the deployment of LTE. Bhikshesvaran says that Ericsson’s involvement in some of the early rollouts, from Metro PCS and Verizon Wireless, have enabled the firm to identify four key areas of preparation.

The first of these is interoperability testing on the device side, he says. “When you have many devices loading up you need to make sure you’ve done enough testing that the protocol interaction between the device and the network is exactly what it should be,” he says. “If it isn’t then what you get is a tremendous overload in signalling that puts artificial load on the network.”

Interoperability testing for data is far more complicated than it was for voice, Bhikshesvaran says, and a number of conclusions remain to be reached. How long a device should be left inactive before being put into dormancy mode is one example, he says, stressing that “it’s important to do that testing up front so you have an idea of how you dimension your network.”

It is equally important that IP infrastructure is put in place before the deployment of LTE eNodeB boxes, he says. The self-organising nature of LTE networks mean that each eNodeB unit will require a number of IP addresses as it configures itself with the network after installation. Properly addressed, this can make the process of the base stations “coming alive” extremely smooth, Bhikshesvaran says, claiming an eNodeB integration rate of “close to 100 base stations per week” during the deployment of the Metro PCS network. IP infrastructure is also key to session continuity when handing over between 3G and LTE, he says.

Interoperability testing in the Evolved Packet Core is the third area that needs to be adequately prepared for, while the fourth is backhaul. Before Verizon had even appointed a supplier for its LTE network it had provisioned the backhaul, Bhikshesvaran says. “Verizon probably started thinking about backhaul 18 months before they signed with us. They were so advanced that, by the time we showed up there on site with our base stations, the backhaul issue was already taken care of. It really does require that much forethought to make it work.”

Verizon’s deployment model for its LTE network involves it supplying spectrum to partner carriers in certain markets in return for them building a part of the network. It’s not the only novel approach that LTE is bringing to the US, with newcomer Lightsquared making a high profile bid to monetise an all-wholesale model. Bhikshesvaran believes that these types of innovation are a matter of timing more than finance, with operators keen to get an LTE service established as soon as possible.

“If operators have to do this with a few partners then that’s fine, they should go and do it. But four years down the line, when everything is stable and mature, they may have different business models in place,” he says. “I think some of these things might be revisited and questioned, with operators asking themselves why they are doing something a certain way, what the economics are and whether it’s better for them to build or own the networks. The same questions are coming up now for 2G and 3G. It’s just a function of time.”

Time changes everything, certainly, as Ericsson’s rise to prominence in the US illustrates. But what will time do to that prominence? Bhikshesvaran says he doesn’t take competition lightly, but declines to name his biggest challenger, preferring to talk in hypothetical terms. “The kind of company I would worry about is one that can pull a fantastic story together that connects everything from user experience, through the devices, all the way to the core of the network on a TCO platform that nobody else can compete with . If there’s a company that can do that, I’d be worried.” Any takers?

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