Qualcomm claims 30 5G fixed wireless access deal wins

5G has opened up a whole new channel for Qualcomm to flog its modems through and it seems to have got off to a decent start.

The company has announced that its X55 5G Modem-RF System has been bought by over 30 global OEMs to form part of fixed wireless access customer premises gear that they’ll start flogging sometime next year. The bandwidth promised by 5G makes fireless a viable alternative to fixed broadband in certain scenarios and it looks like that market is picking up.

Here are 34 companies that were prepared to admit they were making Qualcomm-powered FWA kit: Arcadyan, Askey, AVM, Casa Systems, Compal, Cradlepoint, Fibocom, FIH, Franklin, Gemtek, Gongjin, Gosuncn, Inseego, LG, Linksys, MeiG, Netgear, Nokia, Oppo, Panasonic, Quanta, Quectel, Sagemcom, Samsung, Sharp Corporation, Sercomm, Sierra Wireless, Sunsea, Technicolor, Telit, Wewins, Wingtech, WNC, and ZTE.

“The widespread adoption of our modem-to-antenna solution translates into enhanced fixed broadband services and additional opportunities to utilize 5G network infrastructure for broad coverage in urban, suburban and rural environments,” said Qualcomm President Cristiano Amon. “Due to the development ease of our integrated system and industry movement toward self-installed, plug-and-play CPE devices, we expect OEMs will be able to support fixed broadband deployments beginning in 2020.”

In related new Qualcomm has also unveiled a new reference design that integrates 5G and Wi-Fi 6 for all your FWA home gateway needs, claiming it’s a plug-and-play alternative to boring old fixed line broadband. They’ve whacked the X55 modem and the Networking Pro 1200 platform into one handy package that Qualcomm will be hoping companies such those listed above will build into their gear.

“This new home gateway reference design can help ISPs and broadband carriers deliver triple-play home internet to customers, including fiber-like high-speed data, television and phone services, all with support for hundreds of devices, in a high-performance single-box solution powered by the latest connectivity offerings from Qualcomm Technologies,” said Nick Kucharewski, GM of the Wireless Infrastructure and Networking Business unit at Qualcomm.

Qualcomm is showing all this shiny new FWA gear off at the Broadband World Forum event currently underway in Amsterdam. FWA has been a theme of the show for a little while, but this is probably the first year is has the potential to steal the limelight from fibre and that sort of thing. Having said that it’s still hard to see why anyone would opt for that when proper fibre was available.

All Modes Lead to Home: The New Broadband Access Boom

Mobile broadband in the form of 4G and now 5G may have been grabbing the headlines for the past few years, but in the background the fixed line broadband market has been growing steadily, driven by both regulatory imperatives and operator expansion ambitions on the supply side, and the increasing use of bandwidth-hungry applications on the demand side.

Here we are sharing the opening section of this Telecoms.com Intelligence special briefing to look at the status of the broadband market and explores how stakeholders can best capture the opportunities and overcome the challeges.

The full version of the report is available for free to download here

Introduction: The Many Flavours of Broadband

Although demand for ever higher-capacity broadband connections are often associated with entertainment services, for example high-definition video streaming or connected gaming, much of the demand for fixed line broadband connectivity is linked to the pervasiveness of digital lifestyles, as growing numbers of people require reliable Internet connectivity to support an ever broader range of applications — remote working, financial services, medical care services, e-commerce and more – and an increasing number of devices.

Ovum, the research firm, reported that by Q1 2018, 1 billion consumers worldwide had been connected to broadband access networks. The firm forecast that the total number of broadband subscribers would top 1.1 billion by the end of this year. More than 20 million broadband subscribers per quarter have been added during the past two years.

Broadband access is an encompassing concept. Competing technologies have flourished during the past two decades. Some ride on the legacy copper PSTN networks – the various iterations of DSL technology and, most recently, Gfast – while others deliver fast Internet connections via cable networks, especially in North America. Satellite connections have also played a (limited) role.

In recent years, fibre connections running all the way to homes or buildings – collectively, fibre-to-thepremises
(FTTP) — has evolved from a niche, high-end solution to becoming a mass market proposition, though this varies wildly from country to country. This medium promises the fastest broadband access speeds to support the most demanding of applications and, as will be evident at the Broadband World Forum in Amsterdam (October 15-17), it is
still witnessing ongoing technological innovation as various flavours of passive optical networking (PON) technologies, such as XGS-PON and NG-PON2, come to market.

Meanwhile, thanks to the ascendency of 4G cellular technologies — primarily LTE, but also WiMax – and the arrival of 5G, fixed-wireless access (FWA) is also gaining increasing, albeit still limited, traction. This option is usually associated with rural and/or underserved areas but is now becoming a viable option in urban areas where the deployment of fibre is challenging or deemed uneconomic.

In addition to the differences between technologies, what qualifies as ‘broadband’ has also been evolving. In 2010, when Finland became the first country to set out the national policy to define access to broadband Internet as a basic right, the threshold was set at 1 Mbps downlink.

The FCC has been using 25 Mbps/3 Mbps (downlink/uplink) as the benchmark to evaluate how well fixed broadband has been deployed. By way of contrast, the US regulator has adopted 5 Mbps/1 Mbps as the benchmark for mobile (LTE) data service coverage.

At the beginning of September 2019, the Norwegian government started the consultation process to make broadband access a statuary obligation by the operators, becoming the latest country to elevate or aim to elevate broadband access to the status of a legal right. Here the government proposed two sets of metrics on which to gather comments: 20 Mbps/2Mbps and 10 Mbps/2 Mbps.

In its policy paper, titled ‘Connectivity for a Competitive Digital Single Market – Towards a European Gigabit Society’, published in 2016, the European Union’s vision included Internet access downlink speeds for all European households of at least 100 Mbps.

Sweden is the most aggressive country when setting its broadband targets. The country’s ‘Broadband Strategy’, published in 2016, defined a ‘completely connected Sweden by 2025’ in three tiers: 98% of all households and businesses should have access to a downlink speed of at least 1 Gbps; 1.9% should have access to 100 Mbps; and the remaining 0.1% should have access to at least 30 Mbps.

For any deployment of broadband connectivity to succeed, a number of factors need to be in place: There must be market demand that can be met by broadband connectivity; the technologies being used should be tried, tested and future-proof; the broadband service providers must be able to achieve a positive return on investment; and there should be a favourable regulatory environment.

Given the current market conditions impacting the suitability of the different technologies (see the next section), projected potential service uptake, and the drivers on the supply and demand sides, this report will focus on developments related to two key technologies: FTTP and 5G-based FWA.

The rest of this briefing includes sections on:

  • The Winners and the Others
  • It’s the Economics: When Fibre Makes More Sense than 5G, and Vice Versa
  • How the Public and Private Sectors Can Help
  • An interview with Nick Green, 5G Business Lead and Marketing Director, Three UK

To access the full briefing please click here

When Fixed Wireless Access makes sense

Telecoms.com periodically invites third parties to share their views on the industry’s most pressing issues. In this piece William Webb, telecoms industry consultant, explores the scenarios in which Fixed Wireless Access is most useful.

Getting copper, cable or fibre to homes and offices is tough. Typically, it requires digging up roads, paths and gardens, using expensive labour, taking months or years and overcoming multiple bureaucratic hurdles. It gets ever-harder as the better opportunities are addressed first, leaving areas where houses are further apart and the willingness to pay for high-speed broadband less clear.

With a take-up rate of 1/3rd and 10m home spacing, costs of providing fibre can easily be £2,000 per home connected. And with wholesale broadband prices at around £15/month that means a payback of over 11 years – a long time for investments that can easily run into billions. In suburban areas with greater home spacing and lower take-up, payback can extend towards 20 years.

Those difficulties have led many, over the last 30 years, to consider wireless as a way around the need to dig. Fixed wireless access (FWA) has been tried around the world with bespoke technologies, with WiMax, with cellular solutions and now with variants of 5G. To date, none have been particularly successful and wireless provides only a tiny fraction of the home broadband connections.

FWA has failed in the past because the economics were never as good as hoped. Often the range of the base station was less than expected and many homes within range were unable to get an adequate signal due to local blockage resulting in too few homes per base station. Self-installation of the customer premise equipment (CPE) rarely worked, leading to relatively expensive installation costs. And often the existing competition upped their game, providing higher data rates and lower prices such that the wireless solution became unattractive. All of these factors remain true, suggesting serious questions need to be asked about any FWA proposals.

The current US deployments by AT&T and Verizon look likely to fall into many of these traps. Base stations and masts are expensive so the operators try to push the range to the limit. This results in many homes not being able to get a good signal, and weaker signal conditions at some pulling down the overall cell capacity. Getting fibre to the masts is expensive and if that much fibre is being laid why not just extend it to the homes anyway? The amount of spectrum that they have is also limiting. While much greater than at cellular frequencies, it is insufficient to allow for many homes in a cell to have simultaneous Gbit connectivity and have some spectrum spare for wireless backhaul or repeaters. And the competition in the US is intense with most homes already being served by copper, cable and in some cases fibre.

But despite all that history and the pessimism, there may be a role for FWA. It could succeed in areas where:

  • Current broadband speeds are below around 20-40Mbits/s, such that for some homes the broadband speed becomes a limiting factor.
  • Fibre is expensive to deploy, perhaps because homes are farther apart, access rights are limited, or likely take-up rate for the service is low.

FWA has been helped by the availability of 60GHz spectrum. This brings three big advantages over other mmWave or FWA spectrum:

  1. The spectrum is unlicensed so there are no costs of spectrum acquisition, and deployment can start immediately.
  2. There is a lot of spectrum – between 7GHz and 14GHz in many countries. This allows for relatively profligate usage to homes and for wireless backhaul, keeping costs much lower.
  3. There is low-cost equipment, building on the back of chipsets developed for WiGig and on a growing global marketplace generating economies of scale.

But mmWave frequencies bring challenges of low range and the need for line-of-sight connections if Gbit rates are to be delivered. This inevitably means a lot of base stations. So the economics only work if the overall base station cost can be kept low. This requires:

  • Using existing structures for masts – lampposts are ideal as they also have power available.
  • Using wireless backhaul from the lampposts to avoid the need to run fibre down the streets anyway.
  • Using low cost fibre connectivity to a cluster of lampposts ideally by accessing existing ducts, removing the need to dig.
  • Using low-cost base stations (often called “access points” or APs) designed and built more like Wi-Fi routers than cellular base stations.

These conditions all need to be met – otherwise the economics of broadly one base station per eight homes will just not work. Barriers can include limited access to lampposts or excessive rent charging from local authorities. Initial experience suggests that there are many towns, villages and outer suburban areas where FWA can be made to work. Where it does, it not only lowers the through-life cost by 50% or more, it is much faster – deployment can happen in weeks rather than the months or years needed to bury fibre. That is good news for those awaiting broadband, for politicians keen to move up the broadband league, and not least for investors who start to see revenues almost immediately.

In a country like the UK, FWA could easily access 20% of the home broadband market. It will not succeed in urban areas where fibre is already deployed, or where the economics of fibre work. Gbit FWA will not work in rural areas where the range needed is too great (although other, lower speed solutions can be helpful here). But in between there are many homes and businesses who might otherwise have to wait a decade for fibre. It could be deployed by a new dedicated FWA operator or as part of a toolkit of solutions from fibre broadband players. It could be used as a way to provide service to areas before eventual fibre deployment, or as a long-term solution.

There is one other barrier to its success. Many have become fixated on “full fibre”. This is a technology obsession – what is needed is high speed broadband to the home not glass buried under the front driveway. This view has arisen because of the assumption that only fibre can provide the near-infinite bandwidths assumed to be needed in the future. But this is false because (1) there is little evidence of rapid bandwidth demand growth and (2) wireless can also provide extremely high bandwidths using ever-higher frequencies. If wireless can deliver what it needed more quickly and cheaply then why not use it? But for many, fibre has become something of a religion, and it is hard to shake those kind of beliefs.

 

William Webb smallProfessor William Webb is CEO of the Weightless SIG, the standards body developing a new global M2M technology. He is also Director at Webb Search, an independent consultancy, where he acts as a consultant for companies including Tutela. Previously, he was a Director at UK regulator, Ofcom.

Three goes live with 5G broadband service

UK telco Three has become the latest to join the 5G bonanza with the launch of its 5G Fixed Wireless Access (FWA) service in London.

With plans to launch the service in 25 cities throughout the UK, the FWA proposition looks to be a challenger to traditional broadband services. We have been told the new service will promise speeds of 100 Mbps between the hours of 8pm and 10pm, peak times for streaming in the living room, offering an alternative to fibre broadband for speed hungry customers.

“Three’s 5G is going to revolutionise the home broadband experience,” said Three CEO Dave Dyson. “No more paying for landline rental, no more waiting for engineers, and even a same day delivery option. It really is the straightforward plug and play broadband that customers have been waiting for.

“We’ve taken a simple approach with one single truly unlimited data plan to give customers the opportunity to fully explore 5G and all its exciting possibilities. The ease and immediacy of it all means home broadband using 5G is going to be key to the future of the connected home.”

Looking at the deal offered, there are some interesting elements. Three is promising a ‘plug and play’ experience, meaning customers will no-longer have to wait for an engineer to start the service, while contracts can be taken to new homes if the customer moves. This of course depends on whether Three has launched 5G in the new area, though removing the dependence on physical lines into the home can offer some benefits.

Although this does look like a promising opportunity to disrupt the traditional home broadband market, questions still remain over the long-term viability of FWA as an alternative to the delivery of connectivity over physical infrastructure.

There is a business case for FWA in the remote regions, where the commercial attractiveness of connecting ‘the last mile’ with fibre falls dramatically, though these are not the areas which Three will be targeting to start with.

The launch today is in certain areas of London, while Three is promising to connect 25 towns and cities by the end of the year. These will most likely be the more urbanised areas, this makes commercial sense after all, perhaps targeting regions where fibre penetration is lacking.

As Heavy Reading Analyst Gabriel Brown points out, £35 a month is not overly aggressive pricing, and the 100 Mbps download speeds are very achievable. Users might experience higher speeds during the day, though the proposition might well be more attractive financial and performance wise than many cable services today.

This is where Three could find its appeal. As Brown points out, accessibility to fibre services is a challenge today in the UK. If Three is able to target the regions where Openreach, Virgin Media and the fibre ‘alt-nets’ are missing, there could be a tailored audience for the speedy and reasonably priced 5G FWA service.

Played smartly, Three can drive additional revenues through the business. And while Three does already have 800,000 broadband customers with its 4G FWA service, this could be a notable driver of new revenues for the business. 5G network deployment is going to be an expensive business, therefore sweating the assets in every way possible will be an important factor.

This product opens up a new world for the challenger brand. Over the last few years, subscriber growth in mobile has been relatively flat, though should Three push towards the convergence game, there could be new opportunities to engage new customers with a new message.

5G: Enabling the future telco and beyond

Telecoms.com periodically invites third parties to share their views on the industry’s most pressing issues. In this piece, Ashu Singh, Lead- Solutions Engineering at Tata Communications Transformation Services discusses an effective guide to operationalising and commercialising 5G networks

By 2025, 5G will account for 15% of the global mobile industry – GSMA Mobile Economy Report, Feb 2019

5G is not breaking news anymore, and neither is it hype that you can afford to ignore. Early adopters have embraced the 5G wave and have been busy planning and deploying data-centric networks. Others have been approaching 5G with some restraint, strategizing their move by closely consulting with authorities and facilitators.

Regardless of where they are along their 5G journey, the fact remains that 5G is a game-changing, all-IP solution that can benefit users and CSPs alike. What’s more, 5G adoption is almost always coupled with industry-wide digital transformation, which functions to challenge and disrupt the human-machine connection as we know it.

Meeting the challenges in operationalising 5G

Drawing from experience, TCTS believes that the 5G ecosystem will largely be attributed to open source contributors and vendors who are standardising the reference architectures for its operationalisation – be they the Open Network Automation Platform (ONAP), the European Telecommunications Standards Institute (ETSI), OpenRAN, Open CORD (Central Office Re-architected as a Datacenter), or so on. Among mainstream OEMs, 3GPP, Broadband Forum, and several others are doing great work in developing standards around NG-Radio, fronthaul-backhaul, standalone (SA) and non-standalone (NSA) core architectures, while simultaneously building the technology gears required to run 5G networks.

The main challenge with 5G operationalisation or commercialisation, as always, would be appropriately planning, building and operating networks of highly complex nature. 5G-enabled projects are often intended to enable futuristic and definitive use cases, driven towards greater socio-economic commitments and purposes.

Steps for an effective 5G deployment   

  1. Strategic planning and governance: To begin with, 5G would require precise long-term planning, involving not only RF but also integrated fibre. Such planning will be key for transport networks as well the X-haul, while targeting the throughput and scenarios governed by ultra-reliable low latency services. The governance will extend to FWA as well, since it is the sole solution to the present broadband crunch and the time-limited demands of networks (since FTTx types of solutions will be non-economic for such scenarios).
  1. Making the right technology choices: 5G networks are going to be densified and localised, and so the application of mmWave as a choice needs to be done carefully. Transport networks would need careful planning around fibre deployment, IP/MPLS and so on. 4G-to-NSA-to-SA migration strategy will be key to an impactful and end-to-end 5G rollout. Such a project is likely to be governed by virtualisation at the core and RAN. CSPs will have to exercise discretion in terms of ascertaining future flexibility, and selecting the right vendor and open source platform/tools for different domains, while keeping the services live and the costs, contained.
  1. Testing to perfection: Prior to any large-scale deployment, it is advisable to have a virtualised test environment where prototypes or small-scale replicas can be tested and run on near real-time networks, by enabling 5G services encompassing URLLS, eMBB and mMTC. This must be governed by DevOps methodologies so that CSPs may test and assess multi-vendor networks that are a mix of proprietary and open source software. In-house development and having a 3rd party vendor-agnostic service partner can be beneficial as well, bringing a broader outlook into the picture.
  1. Orchestration and operationalising: In the end, it all comes down to operationalisation, and that is where the role of orchestration becomes even more important. The master of orchestration will oversee the end-to-end domain architecture, managing the life-cycle of network elements, services, resources, traffic paths, and so on, to make network visibility and service availability efficient and effective. From a business perspective, and in regard to commercialisation, network slicing and multi-access edge computing would assume priority as enablers of new revenue streams and transformative, yet disruptive, business models.

 

About the author

Ashu Singh, Lead- Solutions Engineering, Tata Communications Transformation Services (TCTS)

Ashu SinghAshu Singh is a leading the Global Solutions for Telco Cloud and Virtualisation at Tata Communications Transformation Services (TCTS) and has been focussing on innovative solutions around next-gen technologies like Network Slicing, SDN/NFV, ML and Blockchain in Telecom. Prior joining TCTS, Ashu has worked for Cisco Systems, Netcracker Technologies and Idea Cellular Ltd. in diverse roles spanning across Mobile Packet Core Engineering, SDN/NFV Solutions Presales and Prepaid Billing Operations respectively. Ashu, holds an Electronics and Telecommunications Engineering degree from Army Institute of Technology, Pune, India.

FWA is starting to gather momentum in UK

The idea of Fixed Wireless Access (FWA) has been belittled in the past, but it is moving beyond ‘flash in the pan’ territory and becoming a genuine alternative across the UK.

Some have been harping on about the benefits of FWA for years, while others have snubbed the concept for more traditional means of broadband connectivity, but there is growing interest in the technology throughout 2019. The latest to join the hype is Macquarie Capital, yet another private investment company looking to capitalise on the sluggish telco segment. Here, the team is backing the rollout of FWA solutions in rural communities.

“The roll-out of superfast and ultrafast broadband has too often focused on the UK’s urban centres – leaving untapped investment requirements in the UK’s rural communities,” said Oliver Bradley of Macquarie Capital.

“We believe that using Macquarie Capital’s unique principal investment and development expertise there is a significant opportunity to work with Voneus to accelerate the deployment of UK rural broadband, this will help unlock significant economic and social benefits for the UK.”

Working alongside emerging ‘alt-net’ Voneus, Macquarie Capital will invest £10 million initially and an additional £30 million through various different build-out phases. FWA will be the tip of the spear, as Voneus looks to focus on 900,000 homes across the UK countryside who still don’t have access to Superfast broadband services.

“Macquarie Capital’s backing is a huge endorsement of Voneus’ business model and vision, as well as an indication of how much work still needs to be done to connect the many homes and business across the UK that still do not have access to decent broadband services,” said Steve Leighton, CEO of Voneus.

While the only option for genuine 100% future-proofed broadband connectivity is fibre, the FWA revolution does offer considerable benefits. Firstly, it is faster to deploy as last-mile connectivity is over-the-air, removing the complications of civil engineering. Secondly, it is cheaper to deploy raising the interests of the telcos. And finally, it satisfies the need for the moment.

FWA could be viewed as half-way house on the road to full-fibre deployment as it offers the connectivity speeds which are required today. Some Government targets for broadband infrastructure are non-sensical as they focus on technology not the desired outcome. If the immediate desire is to deliver relevant download speeds in the home, this can be done through FWA solutions. There is no reason why FWA can’t address the immediate challenge, assuming of course there are on-going plans to rollout fibre infrastructure over a reasonable period of time simultaneously.

This is what Voneus is proposing. It will deliver FWA connectivity in areas which have largely been ignored by the traditional providers, while also working the business case to deploy full-fibre broadband in the future.

This approach might irritate some of the traditional telcos in the UK, but there are cases around the world where it has been proven a success. Over in the US, Starry is a FWA ISP which is rapidly expanding. Although it is focused on multi-dwelling units in major cities, the theoretical business model, and customer appetite has been proven.

Closer to home, Three and Vodafone have also launched their own FWA propositions for 5G. It will be interesting to see how these convergence strategies play out, but Three already has 800,000 home broadband subscribers through its acquisition of UK Broadband. This is an area of great potential for these two broadband challengers, especially should the reliability of FWA be proven as 5G rolls out across the country.

The idea of a fibre spine and wireless wings is not a new one, but it is certainly one which has merit. Here, Voneus could certainly gain traction in areas which have been neglected by the traditional player because of the high-cost of deploying infrastructure. FWA can be a good idea, just as long as its not the final goal for the ISP in question.

Unlimited data is inevitable with 5G, but try telling operators that

We’re quickly moving into the 5G era and many assume the concept of unlimited data bundles will be commonplace, but how will the telcos fare in this new world?

As it stands, the telcos are under pressure. This is not to say they are not profitable, but many shareholders will question whether they are profitable enough. Tight margins and a squeeze on core revenue streams are common enough phrases when describing telco balance sheets, but this could get a lot worse when you factor in unlimited data packages.

As Paolo Pescatore of PP Foresight pointed out, when you offer unlimited data you are effectively killing off any prospect of revenue growth per subscriber in the future. In some markets, there are still fortunes to be made, but in some, such as the UK where 4G subscription penetration is north of 100%, where are you going to make the growth revenues from when consumers are demanding more for less?

More consumers are seeking unlimited or higher data allocations but are not willing to pay for the experience. Some MNOs might be able to resist, but the more rivals who offer such tariffs the more the rest will be forced into line. It’s the race to the bottom which is profitable in the short-term, but growth will end quickly. The price per GB is only heading one direction and unlimited data allocations will end the prospect of upgrading customers.

O2 fighting for air

This is the conundrum which the telcos are facing in the UK right now. All four have announced their 5G intentions and all four are promising big gains when it comes to the next era of connectivity.

Starting with O2, the only one of the four MNOs not to have released 5G pricing to date, this is a telco which looks to be in the most uncomfortable position. Over the last few quarters, the management team has boasted of increased subscriber numbers, but this can only go on for so long in the consumer world. Soon enough, a glass ceiling will be met and then the team will have to search for new revenues elsewhere.

This is of course assuming it plans to go down the route of unlimited data, it might want to stick with the status quo. That said, if everyone else does, it will not be able to fight against the tide for fear of entering the realm of irrelevance.

The issue here is one of differentiation. The idea of attracting new customers by offering ‘bigger, meaner, faster’ data packages will soon end and telcos will have to talk about something else. O2 does have its Priority loyalty programme, but with rivals launching their own version this USP will fade into the noise.

Differentiation and convergence are two words which have been thrown around a lot over the last few years, though O2 has thus far resisted. Last year, CEO Mark Evans suggested he was not bought into the convergence trend and would continue as a mobile-only telco, though this opinion does seem to be softening.

If O2 is going to be competitive in the almost inevitable era of unlimited data, it will have to source growth revenues from somewhere. It is making a push into the enterprise connectivity world, which will bring new profits to the spreadsheets, though does it want its consumer mobile business to stand still?

Bundles of fun

This is where the other telcos in the UK have perhaps got more of a running start in the 5G era. EE has its connectivity assets in broadband and wifi to add value, as well as a content business of some description. Three is already known as the data-intensive brand, while its FWA push will take it into some interesting connectivity bundling options. Vodafone also has FWA, a fibre partnership with CityFibre and is arguably the leader in the enterprise connectivity market. The rivals are offering more than mobile connectivity as a stand-alone product.

Looking at Vodafone to begin with, the recent announcement is certainly an interesting one. The innovative approach to pricing, tiering tariffs on speeds not data allocation, will attract some headlines, while it is also super-charging its own loyalty programme, VeryMe. It has secured content partnerships with the likes of Sky, Amazon, Spotify and gaming company Hatch, while its FWA offering also includes a free Amazon Alexa for those who sign-up early enough.

Combining the FWA product or its fibre broadband service, courtesy of CityFibre, also gives them the ‘connectivity everywhere’ tag, a strength of BTs in recent years, to allow them to communicate and sell to customers in a different way. Perhaps it is missing a content play to complete the convergence bundle, but it is in a strong position to tackle the 5G world and seek additional revenues should the unlimited craze catch.

The same story could be said of Three. With the acquisition of UK Broadband, it has forced itself into the convergence game and kicked off the ‘race to the bottom’ with an unlimited 5G data offer. As long as you have a Three 4G contract, you can get 5G for no additional cost, assuming you have a 5G compatible phone of course.

Three’s strength and weakness lies in its reputation. It is known for being the best telco if you have an insatiable data appetite, this works very well for the 5G era, though it is also known for having a poor network. Three regularly features at the bottom of the network performance rankings, especially outside of the big cities where it has not done nearly enough to satisfy demands.

This will of course change over the next couple of months. Three is working to improve its network with additional sites and a new Nokia 5G core, however it will have to do a lot to shake off the reputation is has acquired over the last few years.

EE is perhaps the most interesting of the four. It has lost its position as the market share leader when it comes to 4G subscriptions, but it does have the reputation for being the best in terms of performance throughout the country. It is regularly the fastest for download speeds, but its 5G pricing is by far the most expensive to be released so far.

That said, with the BT assets it has for wifi and broadband, as well as the content options, there is plenty for the consumer to be interested in. Should BT be forced to readdress the pricing conundrum, it might not have the fear regarding a glass ceiling on revenues as there are plenty of other products to engage the consumer. It will be able to find additional revenues elsewhere.

MVNO no you didn’t

Outside of the MNOs, you might also start to see some competition. MVNOs are nothing more than ‘also rans’ today, but Sky has officially entered the 5G race. This is an interesting competitor, one who could cause chaos to the status quo.

Firstly, understand mobile is not the primary business for Sky. This is an add-on, where it is seeking to drive additional revenues and attract more customers through bundled services. It is the leader in the UK when it comes to premium content and has a thriving broadband unit also. Sky can add services on top of connectivity to make itself seem more attractive than the traditional mobile service providers.

Then again, there are only a couple of MVNOs who can pose this challenge. Sky is one, while there are persistent rumours Amazon wants to get involved with the connectivity game and Google has its own Fi service. These are also companies who are at the mercy of the MNOs in terms of the commercial agreement with the MVNOs, so damage is likely to be limited unless one network owner decides to go down the wholesale infrastructure route.

But you cannot ignore these companies. They are cash-rich, constantly searching for new ways to make money and have incredible relationships with the consumer. They are also the owners of platforms and/or services which are very attractive to the mass market; bundling could be taken into a new context with these firms.

Diversity is our strength

This is of course only looking at the services which are common throughout telco diversification plans today, there are other options. Orange has launched a bank, has experimented in energy services and is making a move towards the smart home in partnership with Deutsche Telekom. Over in Asia, gaming is an important element of many telcos relationships with consumers and this trend is becoming much more prominent in the European markets also.

Elsewhere, the smart home could certainly offer more opportunities for telcos to add-value to an emerging ecosystem, while the autonomous vehicles offers another opportunity and so does IOT. The issue which many of these telcos are facing is competition from the OTTs. Arguably, the battle for control of the smart home might already have been won by the OTTs, though the same could be said for autonomous vehicles and IOT.

In many of the emerging segments, telcos will remain a connectivity partner though they certainly need more than that. This will remain a consistent stream of revenue, though it will also sleepwalk telcos to utilitisation. In IOT, as an example, the major cloud players are crafting business units to engage enterprise businesses for edge and IOT services; this is a market which the telcos would love to capitalise on for both enterprise and consumer services.

Security is another which is increasingly becoming a possibility. The concept of cybersecurity is generating more headlines and consumers are becoming more aware to the dangers of the digital world. Arguably, the telcos are in the strongest position to generate revenue from this segment; there is trust in the brand and they have largely avoided all the scandals which are driving the introduction of new regulation.

Unlimited data is certainly not commonplace today, but with the services of tomorrow promising to gobble up data at an unfathomable pace, it would surprise few to see more people migrating to these tariffs. The question is how you make money once you have migrated everyone.

Diversification and the acquisition of new products is not a simple task, but then again, it is becoming increasingly difficult to imagine how single revenue stream telcos will be able to survive in the world of tomorrow.

 

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Vodafone UK enters the 5G FWA fracas

Vodafone UK has debuted its 5G Gigacube to further expand its connectivity portfolio, perhaps gaining more of a foothold in the broadband market.

Although Vodafone is primarily associated with the mobile segment in the UK, it has been making positive moves in the broadband market over the last twelve months. Having signed a partnership with CityFibre last year to deliver fibre broadband services, the 5G Gigacube offers another twist to the portfolio.

Vodafone claims the 5G Gigacube can offers speeds of up-to 1 Gbps, the dreaded conditional statement which been suggested to mislead customers, while 64 devices can be connected simultaneously, and the range can be as great as 90 metres. There are still a lot of unknowns and nuanced language in these statements, but it does seem to be priced competitively as you can see below:

Data allowance 100 GB 200 GB Unlimited
12-month contract £25 (£83 upfront) £33.33 (£42 upfront) £41.67 (£42 upfront)
30-day contract £25 (£271 upfront) £33.33 (£271 upfront) £41.67 (£271 upfront)

Interestingly enough, there have also been some clues into the way in which it will be marketed.

Due to the offering being mobile by nature, there aren’t geographical limitations, in theory. If you are a small business without a fixed office, the plug and play feature allows you to effectively carry connectivity wherever you are. This could be applied to a variety of situations, such a pop-up restaurants or bars, and could potentially open-up new markets for broadband products.

It also tackles another interesting challenge in the consumer broadband market. When a customer moves home, there is no guarantee that customer will be retained; it depends on offers which are available wherever that customers actually moves to. With a plug and play, mobile driven, broadband solution, contracts can be retained irrelevant as to where the customer lives.

Although we have been teased with the launch of the 5G Gigacube over the last couple of weeks, its debut today completes the puzzle when it comes to convergence.

Convergence is one of the most consistent buzzwords over the last couple of years, but that is for a very good reason. Not only are convergent customers more likely to be retained year-on-year, it increases the profitability of subscriptions. Most telcos would rather have one million customers taking two services than two million taking one, and this product offers Vodafone another opportunity to make the most of the buzz.

Announced earlier this month, as the telco switched on its 5G networks, Vodafone will offer a convergence connectivity product, combining a home wifi solution with mobile for £50 a month. And to sweeten the deal, customers will also receive an Amazon Alexa speaker for free.

Vodafone has largely been viewed as an ‘also-ran’ over the last decade, O2 and EE have built a considerable leadership position, though the former-market leader has been rebuilding over the last few years.

The turnaround in the business does seem to coincide with the introduction of Vodafone UK CEO Nick Jeffery. During his tenure, the team has built a converged network, Redstream, addressed customer service with the introduction of chatbots, the retirement of legacy IT systems, reinvigorating the brand and creating a business which is contextually relevant. Although this is not mission complete, you can see the progress which has been made.

Vodafone feels like a new business at the moment and it couldn’t have happened at a better time. The world is about to enter into a new era of connectivity with 5G and FWA challenging traditional home broadband. Vodafone is positioning itself very well.

Industry says Government should focus on outcomes not specific tech

Being forward looking is an excellent quality to have in a national government, but when objectives are focused on technology not the desired outcome, it is a risky approach.

In this instance, it seems the UK Government can do nothing right. For years, the focus of the fixed industry was G.Fast not fibre, believing that the connectivity half-way house was a sensible strategy. There might have been adequate arguments made at the time, but with hindsight they do seem underwhelming.

Now the position is to drive towards a full-fibre, connected nation, with targets to connect every household with the future-proofed lines by 2033. However, some are now questioning whether this is an over-correction.

The issue seems to be that the UK Government is focused on technology, not delivering the desired outcome.

“We will cover the overwhelming majority of the UK with fibre, but there are also other technology developments which will contribute to a connected Britain,” said Clive Selley, CEO at Openreach. “These include FWA [Fixed Wireless Access] and low-orbit satellites, and we have mentioned balloons, we should be open-minded.”

Fibre should be the objective but doesn’t mean you have to deliver it to everyone and everywhere tomorrow. As Selly pointed out during his time on stage at the Connected Britain event, connecting the first 80% of premises to fibre is not an issue. It is expensive, it is time consuming, but its not complicated. The next 10% is going to be much more difficult, and the final 10% is where they haven’t worked it out yet.

Another interesting point is whether customers actually need fibre connectivity right now. In the desire to go end-to-end, you have to wonder whether fibre is needed for the last-mile. Long-term, of course it will be necessary, but it is about addressing the desire not the technology.

“In my opinion, government has been focusing too much on full-fibre,” said Three CEO Dave Dyson. “I would like the government to take a step back and understand what people actually need. Full-fibre is an answer, but it is not the only answer.”

Again, we would like to emphasise fibre should be the long-term aim. But, you have to ask what the actual objective of the UK Government is. In this case, it is to deliver faster connectivity to citizens across the entire country, irrelevant to the local environment.

Understanding fibre is the long-term objective, but the mid-term objective is accessibility to faster and more reliable connectivity is an outcome-focused strategy. This is where fixed-wireless access can play a role, as can low-orbit satellites and even balloons. The last mile can be delivered through a variety of options, as long as the foundation of the network is fibre, giving the option to extend in future years.

Unfortunately, it seems the UK is in a difficult position of its own making. In not embracing fibre earlier, it is behind the trends. A commitment to full-fibre might have been the right call 6-7 years ago, but the situation has changed. The current strategy does not necessarily present the UK with the best route towards the full-fibre nation; the plan should be evolved to consider context.

Here is pragmatic example, how many people actually need speeds north of 150 Mbps right now? Not many. Fibre is the best option for the long-term, but focusing on developing the foundations, delivering the experience which customers need and expect, while also creating a more sustainable approach to ROI should be the mid-term objective.

As Dyson pointed out, FWA offers the team a more readily available opportunity to drive revenue on a per-user basis. It allows them to react to customer demand as opposed to forecasts. However, for the proposition to work as promised fibre needs to be rolled at least to the cabinets everywhere.

This is a divisive topic. Some believe the telcos should bite the bullet and simply pay to get fibre everywhere. Holding them accountable is perfectly reasonable, but you have to also take into account the telcos have to make money as well.

When you consider context, financial demands and future-proofing the network, the equation is a very difficult one to balance. Fibre should be the long-term objective, but right now the demands are for faster broadband while also addressing the appetites of those in the rural communities. The other options to satisfy the connectivity demands of today should not be ignored, which is perhaps what is being done with the Government’s hardcore focus on full-fibre.

Strategies should be outcome focused not technology defined. This is perhaps the problem the UK is facing today.