Mobile operators need offload to be smart and cost effective

By Julian Bright

While acknowledging the need to relieve capacity bottlenecks by offloading data traffic from their networks, mobile operators are looking for ways to better manage the process in order to maintain customer contact and build value. The debate over how to achieve this greater degree of control, and the relative merits of using wifi networks or femtocells for the purpose, was a theme at Informa’s Broadband Traffic Management congress in London, November 16-18, where a day’s proceedings were given over to examining some of the key issues surrounding data offload.

Topics up for discussion included the choice of offload technologies available to mobile operators, such as carrier-grade wifi and metro femtocells; their relative cost and performance benefits; and the opportunities that each provides to develop services and hence drive revenues.

Estimates varied as to the proportion of data traffic that is currently subject to offload. In the Czech Republic, Telefonica/O2 puts the figure at around 20 per cent for handsets but acknowledges that this may be lower than many operators are experiencing. The figure for PC data traffic offload is as high as 80 per cent, according to the operator.

Telefonica/O2 would like to see a higher proportion of smartphone traffic being offloaded from the network, but believes that its customers are not using wifi offload either because their terminals do not support handover and authentication, or because they are “leaking” to other Wi-Fi networks that are free to use. Martin Prosek, the operator’s video and content platforms specialist, said that only around 8 per cent of handsets in the Czech Republic are Wi-Fi enabled, compared to 15 per cent in the UK. He said device support was key and that a “smart proposition” was essential for a successful offload implementation.

This included support for IEEE 802.1x authentication and especially the EAP – SIM and/or AKA protocols, said Prosek. The latter being particularly important for mobile operators in order to keep the subscriber on board and prevent them leaking out from the operator’s network. He complained that mobile phone manufacturers paid insufficient attention to operator based WiFi services. Whereas support for Wi-Fi access via the Symbian platform was relatively good, Android offered insufficient support for EAP-SIM, and PC equipment manufacturers felt no relation to operators at all, he said.

Informa’s own research shows that the current growth in demand for offload will continue, only starting to tail off after 2014. Nevertheless, the use by operators of WiFi and femtocells for traffic offload will continue to make business sense even after the introduction of LTE. Basing its calculations on a theoretical UK mobile operator model as part of its latest cost-per-Gigabyte research, Informa concludes that by 2015 when many operators will have deployed LTE, per-Gigabyte costs will have fallen to the point where offload becomes less necessary.

In reality, however, many operators will see that they can still save costs with offload so will continue doing it and delay deploying LTE, said Informa senior analyst, Dimitris Mavrakis. In the meantime it makes sense to upgrade HSPA or use offload or optimization to deal with capacity issues, he suggested, but noted that offload only makes sense where there is a capacity problem in the network.

Discussion as to the preferred option for offload, wifi or femtocells, prompted the observation from more than one speaker that as Wi-Fi networks are already widely deployed, they represent too good a proposition for operators to ignore. However, in order to extract value from wifi offload mobile operators will require carrier-grade Wi-Fi networks that are more tightly integrated into the operator’s network and back office environments than at present, and deployment of which will incur significant costs. Contrary to the accepted wisdom that Wi-Fi is the cheaper option, femtocells were said by one analyst to provide a “bigger bang” for the operator’s “buck”.

Though not represented at the conference, a number of wifi providers say they are developing carrier-grade products designed to provide seamless handover from 3G/LTE networks while keeping down the associated network infrastructure cost and complexity. By giving operators the flexibility to route offload traffic back to their core network as well as directly to the internet, these products promise greater visibility and management control as part of the offload process.

However, Femto Forum chairman, Simon Saunders, said that operators wanting improved management of the wifi offload process would need to change out their existing wifi networks for carrier-grade products, so undermining the argument that existing coverage of wifi is giving the technology a head start. Nevertheless, at least one operator is proceeding with the wholesale build-out of new, national wifi coverage, he said.

As well as offloading traffic from the RAN and backhaul networks, operators are looking at whether and under what circumstances they might want to offload traffic from the core network. A speaker from InterDigital said that some offload strategies offer more value and some less, but how that was managed from the radio network to the core was absolutely critical.

Basic femtocell offload which is available today, takes traffic from the mobile operator’s radio access and backhaul network, but tunnels traffic back to the operator’s core network. This fits with mobile operators’ need to monetize services through the personalization of services and the application of policy management; something which can’t be said of many current wifi offload approaches.

Future femto offload approaches which are due to be standardized in 3GPP by end-2011 or early 2012, will provide different options for operators. SIPTO (selective IP traffic offload) and LIPA (local IP traffic offload) will provide operators with more flexibility in how they handle different traffic types. SIPTO allows operators to selectively offload some traffic directly to the internet, bypassing the radio access and core networks, while LIPA, which is due to be standardized in 3GPP by 2011/12, is useful for offloading local high bandwidth content in the home.

Other interested parties in the offload discussion included fixed wireless providers such as Ireland’s Imagine, a WiMAX operator which sees mobile offload as an opportunity to tap into mobile operators’ revenue streams. Imagine regards mobile broadband and fixed providers as its main competitors, but says it is getting interest from mobile operators who want to sell WiMAX as an adjunct to HSPA, particularly in areas of congestion.

With the incumbent’s FTTH offering expected to be some years away and Ireland likely to follow behind the UK in licensing spectrum for LTE, with the first LTE networks unlikely to appear before 2014, Imagine sees a window of opportunity during which it can provide offload capacity for overstretched HSPA networks. The company says it will launch dual-mode 3G/WiMAX devices in 2011 and has a relationship with an MVNO that will allow it to provide a single billing solution.

Also jumping on the offload bandwagon was French TV and telecoms group TDF, which proposed using broadcast networks for video/TV offload from mobile networks as an option that provides no limit to user numbers and no risk of saturation.

TV and video traffic on mobile networks represented 20 per cent of total data traffic in 2009, and could rise to 40 per cent by 2018, according to Vincent Grivet, TDF’s director of mobile TV. In order to accomodate this level of growth an increase in network capacity increase on existing 3G sites of between five and ten times would be required, but would be a waste of mobile operators scarce spectrum resources. However, the cost of delivering mobile TV services over a broadcast network was one tenth that of unicast, and could support an unlimited number of simultaneous users, Grivet said.

Thus far mobile operators had failed to engage with mobile broadcast, but the advent of new devices and over-the-top providers will potentially drive the development of mobile broadcast services, which can offer an effective mobile offload solution, he said.