The strategic lessons from 4G roll-outsEIRA HAYWARD ANALYSES THE CHALLENGES OPERATORS HAVE FACED WHILE ROLLING OUT THEIR 4G LTE NETWORKS AND CRUCIAL LESSONS OTHERS SHOULD BEAR IN MIND

Operators across Europe are playing catch up with their counterparts in the US and parts of Asia as they develop and roll out LTE networks, and there are a number of strategic lessons that need to be learned.

In the US the most competitive of the worlds LTE markets with seven opera-tional networks both Verizon and AT&T struggled to provide a consistent service in the early days of their networks and DUHFXUUHQWO\HQJDJHGLQDHUFHPDUNHW-ing war of words over who has the most reliable network.((WKH8.UVWRSHUDWRUZLWKDQ/7(

network, has had to meet its fair share of challenges too. According to Mansoor Hanif, director of network integration and LTE at EE, the company was grappling with merging its two networks, upgrading the network and rolling out LTE all at the same time.

The biggest challenge for LTE is trans-mission you need to provide support in a stable way on the radio network but to get the speed to the end user it needs to be end to end across the whole network, he says.

The transmission links from the radio

network to the core require a massive upgrade which is off the scale compared to anything thats been done before.

Theres a dearth of the skills needed to do the job in Europe, he adds.

In Europe everyone is suffering, one of the main reasons for the delay in roll-outs across Europe is that everyone is struggling to understand how to do it cost-effectively and fast. In Europe, cer-tainly in the UK, theres a limited number of really skilled people with IP networking and telecoms expertise together, and its DVLJQLFDQWFKDOOHQJH

Charge a premium?The question of how to charge for service looms large when you speak to com-mentators about LTE EE has chosen to charge a premium for LTE, a move that is quite different from the prevailing attitude in the US.

Simon Williams, head of telecoms and media at NTT Data, which has worked with a number of operators around the world including Japans DoCoMo to help them roll out LTE networks, says that achieving coverage is critical and wonders if EEs choice of pricing delivers this long term.

You cant exploit LTE until you have penetration. There are two elements to penetration, roll out of the network and roll out of devices, he says.

For customers, LTE is faster and comes with lower latency, while for operators LWLVFKHDSHUDQGPRUHHIFLHQWWRUXQ so Williams personally would price for uptake. Both economic models work - but I would price for penetration. I would price competitively with 3G to encourage uptake of 4G margins are healthy as the ARPU goes up and the costs come down, he says.

However, Warren Tucker, MD of Accen-tures network practice in the UK and Ireland believes there is little evidence to suggest that consumers are willing to pay more for LTE.

In these austere times we are seeing a trend towards customers more actively tracking usage to keep within their bun-dle, he says.

While EE is taking advantage of its UVWPRYHUVWDWXV:LOOLDPVDQGRWKHUVthink it will drop its current premium charges once other LTE operators are up and running.

MLL Telecoms CTO Peter Jennings adds that its important to consider the objectives of the LTE network. Some may be turning to it to help alleviate capacity from already stressed legacy networks, whilst others may be seeking to add value and enhance their mobile broadband proposition in order to remain competitive, he says.

Either way, its important to strike a balance between network investments, new pricing schemes and increasing WUDIFZKHQSODQQLQJIRU/7(UROORXWEE was criticised for expensive plans with limits on the amount of data that could be consumed. Its important to communicate the advantages of an overall quality experience, while offering a compelling user experience one that

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is better than 3G.Chris Nicoll, principal analyst at Analy-

sys Mason, comments that each market is unique in its challenges. But I think there are elements that are common in every market, something of a pattern or a RZRYHUKRZ/7(VHUYLFHJHWVLQWURGXFHGand then matures over time, he adds.

Even if EEs decision to opt for pre-mium pricing on LTE goes against the current run of playthough weve seen operators start with premium pricing in other markets there is already plenty about its pricing strategy that others would do well to note, adds Nicoll.

EE launched a range of tariffs tar-geting different aspects of the market, such as BYOD with a SIM only service, as well as smartphones and data products. Were seeing this lesson being applied over and over again, especially now the ecosystem of LTE devices is so broad and so strong, he observes.

Nicoll says that operators need come to market with tariffs and plans that take advantage of LTEs seemingly excellent data connectivity and which properly exploit consumer trends and habits.

People have one or two smartphones, a tablet, a laptop, a personal Wi-Fi hotspot. LTE is enabling not just a richer mobile experience but the ability to consume data over multiple products, he says.

Open up the pipeIts been shown time and again that more connectivity equals more consump-tion and to prove this point ARPU in the US has not decreased as the LTE market has become more competitive. Nicoll thinks that operators need to work to open up the pipe and create compelling content and a compelling experience. But they also need to be aware that consumers are on data tariffs and dont want to consume it all on an advert or news article.

EEs Mansoor emphasises the need to have the right people in place.

You have to make technical and management decisions all the time every 10 minutes, if you dont have the right

team to be able to do that they will get stuck in the complexities of the network, he warns.

At the moment the big market for LTE is the consumer market, but this could change over time as network coverage increases and businesses become able WRH[WHQGWKHRIFHH[SHULHQFHZLWKacceptable performance for employees on the move. Says Nicoll: Operators are having to move from connectivity model to a value and service model. Mobile devices are extensions of peo-ples personalities people like to have DJDGJHWWKDWUHHFWVWKHLUSHUVRQDOLW\so operators have to move from Im delivering a service to Im delivering a social service if you will. I think opera-tors recognise that they need to make this shift and the market is shifting very quickly.

All about the brandIn such a shift brand positioning is critical, comments Nicoll, operators have to have brand awareness among their intended customers you can be the value brand, the premium brand the quality or infotainment brand, but youve got to have a brand and execute on it exceptionally well.$FFHQWXUHV7XFNHULVPRUHVSHFLF

about how he sees this brand execution playing out: In mobile we expect to see a greater emphasis on high QoS mobile CDNs, premium content acquisition including video and the continued pursuit of M2M related industry vertical solu-WLRQVWKDWDUHVSHFLFDOO\LPSURYHGDVDresult of faster data speeds and lower latency networks.

For example, in the US we have com-panies such as UPS deploying a dynamic mobile van tracking and routing solution that saved over nine million gallons of fuel a year as a result of re-routing vans to avoid delays caused by making left KDQGWXUQVDFURVVRQFRPLQJWUDIF8OWL-mately, such industry vertical solutions could enable operators to move from a cost-based pricing model to a val-ue-to-the-customer based pricing model generating greater returns.

Expert advice

Accenture has worked with the likes of Telecom Italia on their LTE network roll out; head of network practice Warren Tucker highlights some of the key operator challenges: Deploying a new RAN is not a business as usual process and cuts across many func-tions, so a full end-to-end process is needed to manage all dimensions of the upgrade.

Robust capacity planning is needed to ensure the right resources are in the right places at the right times across all third parties and the operators own organisation.

Plan in realistic timescales for activities outside their control such as landlord/local government agreements and reconstruction of antenna systems.

Ensure adequate coordination between in-ternal marketing plans, LTE site deployments, backhaul upgrades and onsite commission-ing activities. Activities are commonly inade-quately coordinated: e.g. RAN equipment is installed but delays in backhaul provisioning mean the site cannot be activated.

Invest in workow tools with so many handoffs between RAN vendors, local contractors, backhaul upgrades as well as back ofce functions to ensure supplier payments and capex management there is huge potential for each handoff to introduce signicant delays in the process.

Establish a way to solve bottlenecks: given an LTE network upgrade is not an every-dayprocess, there is potential for bottlenecks to build up. Successful operators have estab-lished War Rooms to track the milestones associated with each site and each stage of deployment together with teams who can quickly analyse and implement xes to bottlenecks.

Establish a standard set of SLAs, which include commercial levers to ensure supplier responsibilities, and making sure you allow sufcient time for live trials to iron out teething issues.

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