To level-set LTE migration progress, we opted for a sanity check with ACG Research principal analyst Bill Rubino about all things LTE, who gave us the low-down on which 4G LTE vendors are on the scoreboard, developing an evolved packet core (EPC) technology, where LTE equipment mergers and acquisitions might happen, and operator deployments of LTE networks.
In terms of what's really going on, which carriers are on the map with LTE network deployment?
The big thing right now is that Scandinavian carrier TeliaSonera has the only official commercially deployed LTE network. Its deployments are in only two cities -- Oslo, Norway, and Stockholm Sweden -- although that will be expanded to a few more markets. The carrier is using Ericsson and Nokia Siemens equipment, although Huawei will maintain a portion of the network in Oslo. Even though it was included in the LTE trials, Huawei will have very limited involvement there. Which carriers are out there with bigger deployments?
Verizon is the biggest carrier that has put a stake in the ground, saying it will have a commercial LTE network available before the end of 2010. Verizon Wireless will initially roll out services in 25 to 30 metro areas, but it will take time. Verizon is using Alcatel-Lucent equipment for its network trial. With the cost of migrating 3G networks to 4G, what are the actual advantages of LTE for carriers?
Operators will have a lot more bandwidth with 4G. For the customer, that means a bigger and fatter pipe to access content that the typical cell phone can't access. Customers will have access to more applications, especially almost HD-quality video to the laptop, which will drive this migration. In addition to network efficiencies, will carriers be able to charge more for LTE voice and data services?
Carriers will take a close look at how they charge for data because right now plans are unlimited. Once you allow a service like that, it's tough to go back and charge differently. But operators will probably offer tiered LTE service packages. Customer reactions to the changes will depend on the pricing levels. When you introduce a new service, the novelty of it is so great at first that people will pay almost anything just to latch onto it. It's easier to drop prices over time than increase them once a service is launched. In terms of LTE equipment, there's a lot of focus on developing the evolved packet core for LTE. What is it and where does it live in the network?
The evolved packet core (EPC) is essentially where everything (voice and data) comes off the cell towers and aggregates into the giant core of the network to be sent to the Internet or somewhere else. It's the aggregation point for everything to go to the network. The EPC lives between the cell tower and the Internet. There will be aggregation points for cell towers that will eventually feed into the EPC. So traffic could come off the microwave towers and hit Ethernet switches, then be aggregated and hit the evolved packet core. Which LTE vendors are the active participants in evolved packet core technology?
The evolved packet core (EPC) is one piece of LTE technology, and a few players already have an advantage. If you look at Alcatel-Lucent and Ericsson, they're really good with both radios and have some IP expertise. They can build equipment for EPCs, and they can build things on the radio side with antennas and the radio access network. But because this is an all-IP network, other companies like Cisco and Juniper with tremendous IP experience can take advantage of adding a lot of expertise to the evolved packet core because of their footprint in the carrier IP networks. Does the evolved packet core require a brand new type of equipment?
EPC equipment is brand new for LTE, but the footnote here is that it uses LTE standards. Still, a lot of vendors are taking existing core routers and modifying the software slightly or adding new cards to turn them into EPC equipment. So it's doable, but the other approach is to build something brand spanking new. That's what Starent was doing when it was acquired by Cisco. Starent was in EPC equipment and had relationships with a lot of other vendors that were planning to OEM or use them. Cisco came in and scooped it up. With its IP expertise and this piece of equipment built specifically for EPC, Cisco has a big advantage. Have the other major equipment vendors done something similar to play in the evolved packet core?
Cisco did an acquisition, and others are leveraging existing technology. Juniper is retrofitting. Juniper announced Project Falcon, which is taking its existing core router and modifying it slightly so it can be equivalent to work within the evolved packet core. Alcatel-Lucent is modifying an existing core router, adding some cards to it and adding some hardware. Ericsson and Nokia Siemens are also leveraging existing technology.
Tellabs acquired mobile packet core company WiChorus and is building new equipment. It can leverage that with some existing core technology as well and is able to mix all that together. Tellabs initially focused on WiMAX but was able to modify this for LTE as well. Are startups playing a major role in LTE evolved packet core technology? And if so, are acquisitions on the horizon?
There's a lot of work going on with policy controllers called PCRF (policy and charging rules function) for the EPC that do a lot in terms of deciding whether a customer can have access to the Internet or access to certain services within the carrier. Alcatel-Lucent makes its own, but a lot of little companies are out there making their own as well. There is potential for some of those little PCRF companies to get acquired. The thing that will decide whether they get acquired is whether their products have already been trialed in networks. In terms of differentiating one company over the other, there probably isn't much to say. Big players don't play here so much. Which other vendors will get a boost from LTE networks?
One interesting area is how you backhaul traffic from the cell tower to the packet core. Operators will carry a lot more traffic because it's going to be all-IP traffic. Today, they use fiber optics or copper. As the technology for packet-based microwave gets better and better, the cost per bit goes down and will continue to go down. So packet-based microwave may be another area that has potential growth. Carriers are going to need to increase the number of cell sites over time, and if they don't want to run fiber, which could be very costly, the next thing would be microwave. If laptops and netbooks are the first LTE devices, how will they be LTE-enabled?
When LTE networks are enabled, first there will be LTE dongles you plug into your laptop. There have been rumors that laptops and netbooks will eventually have some kind of LTE wireless card in them -- like when Wi-Fi came out. Eventually, there will be LTE phones, but not right now. How will carriers get a return on their LTE technology investments?
Currently 3G and 2.5G networks separate voice and data, with voice carried on circuit-switched networks. LTE actually combines voice and data on one all-IP network. Ultimately, that means you don't need as much equipment because one pipe will handle it all for LTE services. That makes the network a lot more efficient to operate. How gradual will the migration be from 3G to 4G?
There's so much data on 3G networks that it's swamping the voice calls, and the LTE migration will help that. As we integrate 3G and 4G, operators will have a lot more bandwidth to handle the all-IP traffic. If you look at Verizon, it won't shut off the 3G jets just yet. It will migrate to LTE because not everyone is going to have an LTE card or dongle in their laptop, and we don't even have LTE phones yet. What are the challenges of providing voice over LTE?
To deploy LTE voice, the issue is taking voice and data and running it together on an all-IP network. Different solutions were posed last year on how to standardize on voice over LTE. Verizon's LTE rollout will be data only at first because you would need an LTE phone for voice. If you used an LTE dongle on a PC, you could use Skype, but that's not an LTE voice solution.
FYI:Bill Rubino is a principal analyst at ACG Research specializing in service provider mobile network infrastructure. He has worked in the telecom industry for more than 20 years and previously was senior product manager at Motorola, responsible for its wireless broadband product line. He also worked at Nortel, Sycamore Networks, Bay Networks, Wellfleet Communications and Proteon. Rubino has also been involved in different networking technologies, including wireless broadband, intelligent optical switches and core routing technologies. He has worked with the IETF and the IEEE and has received two routing and switching patents. He can be reached at firstname.lastname@example.org.
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