Smarter where it counts

Anthony Lacavera, Chairman, Wind Mobile

With the LTE North America conference taking place on the 8-9 November 2011 at the Fairmont Dallas Hotel in Dallas, Texas, USA, we managed to catch up with Anthony Lacavera, chairman of WIND Mobile, who speaks  about the challenges of launching an LTE network in a competitive market.

As one of the newest wireless operators in Canada it’s not surprising that WIND Mobile is looking to innovate. In a market as competitive as Canada, which is dominated by the large incumbents of Telus, Bell, and Rogers any way it can differentiate itself is going to help it succeed. WIND gained a GSM license in 2008 after the Canadian government auctioned off AWS spectrum, and launched mobile and data services in December 2009. As of September 2011, it has just over 375,000 subscribers, according to WCIS statistics, and operates in the five large English speaking markets of Toronto, Vancouver, Calgary, Edmonton, and Ottowa.

Despite reports from some quarters that WIND has found acquiring subscribers difficult, Lacavera tells Telecoms.com that the WIND’s entrance into the market was significant for being the first new greenfield network in the whole of North America for 25 years. “We started building over a 1000 cell sites. It’s entirely our own network and we have no entanglements with the incumbent operators, being Bell and Rogers.”

With such a new network it’s no surprise to learn from Anthony Lacavera, WIND’s Chairman, that its network is completely IP based and LTE ready and that it’s running network trials of the technology in all its major markets. The peak speeds it has achieved are in the 40Mbps range with a sustained throughput of 20-25Mbps, though Lacavera acknowledges that this won’t necessarily translate into the end user experience. “These are production trials so what can really be achieved is anyone’s guess. We’re actually going to do some controlled roll-outs before we actually we do a full commercial launch.”

Lacavera is also frank that the move to LTE is motivated by marketing rather than technical or performance related. He believes that only a small niche of very high-end users would genuinely benefit from having LTE right now and that the majority of consumers are actually still getting to grips with smartphones. “It’s similar to the PC evolution, when a lot of years went by before people really knew how to use PowerPoint, Excel or Word,” he says. “We’ve in that same phase right now in my opinion with respect to mobile app consumption. People are just starting to figure out how to use them, download and integrate them into their daily lives.”

The reason it’s looking to launch LTE then is to act as a halo effect for the network in the eyes of consumers. “Carriers are under pressure to roll out LTE as there’s a competitive pressure to say that whoever has the fastest network has the best network,” says Lacavera. “That’s obviously not true, but that is what the broad market believes.” Perhaps controversially he lays the blame at the foot of the equipment vendors. “I guess you could say that the manufacturers of LTE network equipment such as Nokia [Siemens Networks], Ericsson and Huawei have been very successful at PR campaigns that have put out a perception globally that faster is better – as opposed to latency, coverage, and throughput.”

Lacavera also isn’t rolling out LTE in the hope that it will solve the WIND’s concerns over the data crunch. “The growth in demand and consumption is geometric”, Lacavera says. “As consumers abandon the traditional broadcast outlets for video, cable and satellite and they migrate to IP, I think the demands are only likely to continue on an exponential trajectory that will continue to put a strain on networks.”

WIND also has to contend with the fact that it only has a 5x 5MHz of bandwidth to play with in its Western markets, compared to 10x 10MHz in its Eastern regions, which could lead to network strain.

One of the ways that WIND plans to deal with these issues is for it to be smarter than competitors over how it uses the spectrum it has available. One technique it that it is examining closely is data profiling. Lacavera explains:

“One of the things that we’re doing at WIND is that we’re starting to profile user content consumption patterns and see if we can optimise the network, per content, per subscriber. So if for example, a subscriber is accessing a lot of financial services, but has other content, such as sport or news as a lower priority, could we optimise that user’s streams so they do receive very high quality news information but with lower priority than other types of content.”

This approach could prove to be doubly smart, as not only will it make the best of limited spectrum, it could actually improve the customer’s perception of the network. “That user’s perception of the network would be as good or better [than before], because the financial news information could be delivered more robustly.”

While this technique is just at the trial stage Lacavera is looking forward to being able to charge a premium for a service that will be of benefit to both the customer and the carrier. As such, it’s looking to protect the technology from rivals. “This overall exercise is in its early stages but we are certainly a leader. Whereas the other Canadian carriers treat all data types similarly we are building technologies to see if we can optimise per user, per content type.”

Another option would be to encourage consumers to think about their mobile networks in the same way that they do with their electricity grid – as a limited resource. WIND hopes to incentivise its users to download music and movie content over their handsets overnight when network usage is low. “It’s a model that users are already familiar,” explains Lacavera. “We are in the process of trying to secure patents with respect to peak to off-peak profiling.”

Lacavera is also refreshing honest about potential backhaul issues particularly in smaller markets where fibre infrastructure is virtually non-existent. “I do anticipate that we will have a problem with backhaul, in those smaller markets. We would go out there and do our best but I wouldn’t want to offer a service that could not perform as advertised so I would defer a launch in those markets. There’s no point in building out the radio access if you don’t have the backhaul.”

As far as handsets go, Lacavera is not worried about the absence of an Apple iPhone that operates on its AWS frequencies. Instead he’s more than happy to see the widespread adoption of Android devices. “The adoption of Android that we can see is beyond explosive, so we’re quite encouraged. Six months ago if you’d asked me, I would have said that we look forward to Apple making the iPhone 5 available on AWS. Today, I would say it’s much less important to us as consumers are really jumping at high-end Android phones from a number of manufacturers.”

Another option to deal with the need for more spectrum for data would be to acquire some through partnering with other smaller competitors to share frequencies. He is also certain that to create a wider LTE network beyond its core markets tower sharing will be a necessity. “Given the sheer geographic expanse of Canada we would not be able to build out LTE without tower sharing.” While this concept is familiar in Europe in it is rare in North America and Canada, though the hope that Sprint and LightSquared’s widely publicised deal will break the mould.

There’s little doubt it makes economic sense, but the problem is making is happen. “The government policy with respect to tower sharing is key for us. Today, even though tower sharing is mandated by the government we only shared five out of a thousand sites with incumbent operators.

“In Europe carriers get on along better it seems. I think [in Europe] the market is much more mature and carriers realise that tower assets are not strategic assets. It’s really about the subscriber acquisition cost, the marketing and obviously you want to keep your costs as low as possible. There’s no magic in building a cell-site if you can share it you might as well do it and cut your costs in half. It’s about being smarter where it counts.”

The LTE North America 2011 conference takes place on the 8-9 November 2011 at the Fairmont Dallas Hotel in Dallas, Texas, USA.