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Showing posts from February, 2018

How Big a Revenue Opportunity are "Smart Cities" IoT Services?

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By some estimates smart cities represent the biggest opportunity for mobile service providers.
Others might disagree, connected home or connected car or manufacturing will be bigger market opportunities.
IoT technology revenues across 12 key smart city technologies and verticals is predicted to grow from around $25 billion in 2017 to $62 billion in 2026, according to ABI Research.
Among the drivers are smart meters and video surveillance, representing $20 billion of the expected revenue.
Of course, “smart cities” might include so many verticals that it is not a single market.

source: Frost and Sullivan

Will 5G Make Packet QoS (Prioritization) Unnecessary?

Network neutrality remains as obscure a topic as ever, despite efforts to reduce it to a bumper sticker slogan. Virtually everyone agrees on the original and basic version: no blocking websites; no censoring online content; no throttling, degrading or discrimination of network performance based on content.
Also, disclosure to consumers about how networks are managed.
Where there is disagreement is when network neutrality is stretched to cover any number of other practices, such as zero rating or packet prioritization. The former is exclusively a matter of business practices. Can, or should, an internet service provider allow consumers access to services, apps or sites without charge?
The latter is a matter of importance for some classes of apps that actually require deterministic performance.
“AT&T is not interested in creating fast lanes and slow lanes on anyone’s internet,” says Bob Quinn, AT&T senior EVP. “What we do care about is enabling innovative new technologies like au…

FCC Readies Spectrum Auctions in 28-GHz, 24-GHz Bands

Assuming the U.S. Congress clarifies rules on upfront payments, the U.S. Federal Communications Commission will hold spectrum auctions in the 28-GHz and then 24-GHz bands in November 2018, for 5G network use.

“It is my intention for the United States to hold an auction beginning this November of spectrum in the 28 GHz band, followed immediately thereafter by an auction of spectrum in the 24 GHz band,” said Ajit Pai, FCC chairman.

That will follow auctions of 600-MHz spectrum, opening up spectrum sharing for 150 MHz of spectrum in the 3.5-GHz band.

“I intend to propose the next steps needed to make the 3.7 to 4.2 GHz band available for commercial terrestrial use,” said Pai.

In addition to those spectrum moves, Pai also noted that the FCC Spectrum Frontiers Order opened up nearly 11 GHz of spectrum in the bands above 24 GHz for mobile use.

“We followed up by making an additional 1,700 MHz of millimeter wave spectrum in the 24 and 47 GHz bands available for terrestrial 5G wireless use,” …

Ninth Circuit Rules FTC Does Have Authority to Oversee Internet Access

With the caveat that the U.S. Ninth Circuit Court of Appeals often makes rulings that are overturned (79 percent), the Ninth Circuit Court of Appeals unanimously ruled that the Federal Trade Commission acted within its authority in bringing a claim against AT&T over its data-throttling practices.
Some will say that the decision validates the oversight the Federal Trade Commission will exercise over internet access services, as proposed by the Federal Communications Commission in its recent Restoring Internet Freedom order.

Window of Opportunity for Paid Prioritization is Shutting

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Despite some fears, in some quarters, about paid prioritization of packets, is that a realistic fear? If the value of packet prioritization--paid or not--is guaranteed performance (low latency), 5G (and advanced 4G) should--by definition--eliminate the problem, and therefore the possibility of profiting from services that offer higher quality assurances..
In other words, the potential value of packet prioritization is quality assurance for applications that require low latency (packet arrival times).
But when a 5G network routinely has latency in single-digit milliseconds, is prioritization still needed, and if so, for what apps? In other words, does 5G actually eliminate the problem that packet prioritization is said to solve?
And, if that is true, then fears about paid prioritization are misplaced. As much as some internet service providers might like to sell packet prioritization services, there might not be a market for such services on 5G networks.
Perhaps paid prioritization could…

5G Will Severely Erode or End Value of "Paid Prioritization"

Is there value in packet prioritization--paid or not--in the 5G era? The prioritized packets value proposition has been latency improvement. When a 5G network routinely has latency in single-digit milliseconds, is prioritization still needed, and if so, for what apps?
The point is that the feared “packet blocking and throttling” still is barred by Federal Communications Commission policy, while “paid prioritization” has a slim window for relevance until 5G arrives.
The stated fears about removing common carrier regulation from internet access will prove misplaced.
As often is the case, telecom regulators and industry executives do not agree on the impact of regulations.  EU Commissioner Andrus Ansip, for example, does not believe network neutrality rules hamper investment in 5G.
Ericsson CEO Börje Ekholm, on the other hand, believes such rules will prevent the creation of new 5G services. “The principle of net neutrality is not to discriminate [against], throttle or degrade based on co…

Historic Change in Telco Business Thinking

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It is not hard to understand that telecom’s historical geographic legacy--specified areas of operation--has implications for operator efforts to grow application businesses at scale. In other words, service providers of all types are accustomed to creating services and apps that run on their own networks, in their licensed territories.
In a new ecosystem where applications run “over the top,” without regard to geography, and where revenue models often require scale, that older mentality often is unhelpful.
One salient and helpful development, in that regard, are the new OTT video streaming apps designed expressly to run on any network, at scale. We sometimes miss the importance.
Where in the past apps were designed to run on “my network,” now apps are being created to run on “anybody’s network.” In other words, the new apps are borderless (to the extent allowed by copyright rules).
That is a fundamental prerequisite for apps in the internet era, especially those with scale requirements…

What Will 5G Cost?

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Will 5G cost so much more than 4G that the business model breaks? If orders of magnitude more bandwidth have to be delivered, and if propensity to pay does not change but incrementally, what happens to capex cost?
What happens if the number of cell sites grows two orders of magnitude?
The number of U.S. cell sites, for example, could balloon from perhaps 80,000 to as many as a million, estimates Jack Waters, Zayo Technologies CTO.
What happens to backhaul costs? Will advanced radio arrays cost less, more or the same as today's radios?

Some fear capital investment could be double to triple the levels of 4G. By other estimates, 5G will require just four percent higher capital investment than did 4G.
Those are huge uncertainties.
But cost parameters are changing so much that some expect 5G capital investment might actually be less than 4G, even if the historic trend is that each next generation mobile platform requires incrementally more investment.
Over the last several decades, infr…

90% of Internet Users Now Use Cloud-Based Apps

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Perhaps 3.6 billion global consumers now use cloud computing, in the form of the apps and sites they use regularly. If there are a total four billion internet users globally, that suggests 90 percent of world internet users use cloud-based  applications and services.
That has obvious implications for the computing industry.
source: wearesocial
In 2017, Amazon Web Services generated about $18 billion of revenue for Amazon. Microsoft, which includes its cloud apps in its cloud revenue segment, booked perhaps $27.4 billion in cloud revenue.
From 2016 to 2017, AWS revenues grew 42 percent from $12 billion to $17 billion, while Microsoft's cloud revenue contributions grew about nine percent.
Looking just at customers of cloud computing services (and not including applications), AWS has perhaps 34 percent installed base; Google 20 percent; IBM 15 percent; Microsoft about 15 percent. source:Credit Suisse
In 2017, enterprises spent about as much on cloud infrastructure services as they did bu…

"Winning" is Not What It Used to Be

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What does “winning” look like for telco internet access? In the monopoly era, this was no question at all. In the competitive era, maximum feasible market share is something else, entirely.
And that underpins nearly all business models. In the monopoly era, a network could be built on the safe assumption that upwards of 95 percent of locations passed would generate revenue.
In the competitive era, it is doubtful whether maximum possible success ever leads to market share more than 45 percent. In other words, no matter how good a service provider is, or how powerful its value proposition, more than half of all locations will not generate any revenue.
Rough implication: the cost of building a network, “per customer,” doubles.
source: Speeda

In Singapore, SingTel, the leader, had 44 percent market share in 2014. source: Alpha Economics
In Nigeria, MTN, the market share leader in 2017, had 39 percent share.
source: Pulse The clear implication is that no service provider, anymore, can build a …