CCOO, Celcom Axiata Berhad: “LTE will challenge traditional backhaul assumptions”

Suresh Sidhu, chief corporate and operating officer at Celcom Axiata Berhad, Malaysia

Suresh Sidhu, chief corporate and operating officer at Celcom Axiata Berhad, Malaysia, is taking part in the ‘Quiz the CxO’ segment on Day Two of  the LTE World Summit, the premier 4G event for the telecoms industry, taking place on the 24th-26th June 2013, at the Amsterdam RAI, Netherlands. Ahead of the show we find out more about Sidhu’s views on how networks can best be optimised for LTE and where RCS/VoLTE fit into the operator picture.

What major developments have there been with regards to the LTE industry in your region this past year?

The region has seen LTE spectrum awards in Malaysia and Singapore and this has been followed by very early deployments in Singapore across both 1800MHz and 2600MHz bands. We have also seen some very aggressive LTE roll-outs in the region, with close to 100 per cent population coverage in South Korea and Japan.

What are the chief technical challenges you are facing?

The key challenge is planning for and ensuring a seamless customer experience through the availability and co-existence of 2G, 3G and 4G networks. Currently we are upgrading our existing cell sites to cater for LTE and in addition, we are upgrading our backhaul infrastructure in a timely manner to ensure sustainable growth. In Malaysia, the national regulator has requested for LTE backhaul sites to be fiberized, adding to further rollout complexity.

The LTE World Summit, the premier 4G event for the telecoms industry, is taking place on the 24th-26th June 2013, at the Amsterdam RAI, Netherlands. Click here to download a flyer for the event.

What are the key techniques for network optimisation in LTE and what effect can it have on the customer experience?

It is critical that LTE network optimisation is performed end-to-end, taking into consideration the faster and asymmetrical data throughput across network elements. On radio access, it is imperative to optimise the multipath propagations that LTE-MIMO antenna technology delivers. For the core network, the use of network probes with Deep Packet Inspection coupled with the use of web caching further aids in optimising data traffic routing. Both techniques deliver a cost-effective solution in ensuring a superior end-user LTE experience.

Is VoLTE part of your plans and what benefits will it bring both to operators and consumers?

Celcom is actively following developments in this area. However, VoLTE will likely only become a part of our service offering in 24 to 36 months, as the technology matures and networks evolve from circuit to packet-based systems. We look forward to VoLTE, as it enables operators the ability to offer a differentiated class and quality of service coupled with Rich Communications Suite (RCS) integration. However, a wide LTE coverage area is essential prior to VoLTE deployment.

Do you believe that RCS services can genuinely help the industry compete with OTT?

The success of RCS services depends on the speed at which operators are able to integrate, test and deploy applications over their platforms in addition to ensuring a steady stream of new applications and services. Operators face a challenge in monetising these applications in an environment where OTT applications are offered as a freemium. There are also organisational challenges that telcos need to consider as they are not product innovation factories, whereas the OTT players are used to the rapid development cycles of testing, launching and discarding applications and services.

Pricing for LTE is a controversial subject. Are operators getting it right?

Operators are caught between wanting to increase tariffs for LTE for rapid LTE monetisation on the one-hand and incentivising LTE migration on the other in order to free up 3G network congestion. Many operators appear to offer LTE with little to no premium, which puts further strain on profits and margins. Celcom believes the right pricing strategy is to position LTE as an extension to 3G with larger data caps at a slight price premium. Device, network and application strategies are key considerations in pricing for LTE.

Do you think that LTE offers great opportunities for monetisation or does it present challenges?

LTE offers numerous opportunities in creating new revenue streams via product and service differentiation. We believe that LTE, with its faster data speeds and lower latency, encourages greater data consumption of OTT video, peer-to-peer sharing and multiplayer gaming type applications. In order to capitalise upon this trend, operators need to include application-based charging and service pass concepts as part of their charging mechanisms.

Furthermore, with an LTE overlay over existing networks, operators have the opportunity to create new Quality of Service and Policy Control-based charging mechanics in further drawing incremental revenues not only from LTE but also from their existing 3G networks.

Is there still a need to establish a business case for LTE deployment or is the long-term ROI potential clear?

The long-term ROI is clear. However in the shorter term, LTE deployment should be based upon the needs of the market coupled with the availability of LTE-enabled devices that support the LTE bands which have been assigned in-country.

Where do small cells fit into your plans, if at all?

Depending on the small cell wireless technology deployed, small cells fit in certain niches where they are more cost effective as opposed to a ubiquitous wifi, 3G or 4G overlay. However, the debate on the exact nature of small cells is likely to continue. Today Celcom is deploying WiFi, Nano/Pico and Femto cells to enhance gaps in coverage or provide a richer data experience. A convergent approach is needed but we have yet to see a compelling technology solution.

What impact does LTE have on your backhaul strategy and technology choices?

We believe LTE will challenge traditional backhaul assumptions. The gradual upgrade approach may well be discarded by the step-change approach, mostly in favour of fibre. The need for consistent, high availability bandwidth will likely drive this change.

What do you think will be the most exciting new development in LTE in 2013?

The innovative pricing strategies and roll-out criteria adopted by the operators in deploying LTE across their existing 3G footprint.

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