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Femtocells Asia Trip Report: Four themes from the Four Seasons

Femto Hub Blog (Mar 28 2009) Asia-Pacific

Categories:
Hot Topics: 4G, Applications, Network, Standards
Regions: Americas, Asia-Pacific, EMEA
More: Femto Events, Market Research
Value Chain: Enabling Technologies, Femtocell Specialists, Network Equipment Vendors, Operators
Other: Jobs, Misc
  1. By David Nowicki

    Avren Femtocells Asia took place earlier this week on 23-24 March at the glamorous Four Seasons Hotel at Chinzan-so in Tokyo, Japan.  As usual, Avren Events did a great job lining up an impressive list of operator speakers from around the world.  Andy Tiller did a nice write-up of the operator talks here.

    The conference produced four distinct themes…
         
    1.)    Femtozone Services! Operators, vendors and analysts can’t get enough.
    2.)    Trial Results. Progress, Problems and Solutions
    3.)    Coverage in Asia: Great outdoors, but questionable indoors
    4.)    Mobile Broadband. The success of this service continues to defy gravity
     
    Femtozone Services
    This topic used to be 1 or 2 slides in everyone’s presentation as a futuristic concept. Now it has come front and center.  It was the focus of 3 (Softbank, NEC and Airvana) of the first 5 presentations. For Softbank, the change from earlier trial results, deployment plans and technical considerations was noticeable. Although services will not be included in the SBM offering until “phase 2” of the SBM rollout (presumably in 2010), it is nice to see that prototypes are working in the labs and that the marketing teams are starting to design compelling services tailored to the Japanese market. I was impressed with consumer emphasis of the Softbank videos. The dramatic expressions, comical scenarios and  superb localization of the femtozone services is in the style of Japanese popular TV - a sign that SBM is working hard to communicate the femtocell value proposition to everyday consumers rather than just to the femto-savvy conference attendees.
     
    Coverage
    In the early days of femtocell discussions, only North American operators talked openly about coverage problems. The rest of the community seemed content and more concerned about using femtocells for capacity offload and fixed mobile substitution. Now, we are learning that coverage is a more widespread problem than initially reported. Operators from Singapore, Taiwan, Japan, Korea and China as well as those from the US and Europe discussed vary degrees of coverage issues in their countries. For example, 84% of customer complaints in Taiwan were because of poor indoor coverage. That is a remarkable figure and matches comments from operators in Singapore and others across Asia. I ran my own tests over the preceding weekend. Out of the five wireless networks in Japan, two had no signal at all in the main ballroom of the hotel (conference location), two others had just 1 or 2 bars of coverage and one had an average of 3 bars with occasional glimmers of 4-5. This was in sharp contrast to the exceptionally good coverage available near the window or just outside the walls of the hotel. As you can imagine, this translated into shaky voice coverage and low data rates for conference attendees. I can’t wait for the day when operators have deployed both femto and pico solutions for such an occasion.
     
    Trial Results
    It was refreshing to see so many operators talk openly about trial results. This was the highlight of the conference. And as you might expect, early femtocell trial results have provided further motivation to move to commercial service and have also uncovered issues that are currently being addressed. The good news is that the femtocells appear to be delivering great coverage, increasing data rates, and offloading traffic.  Mr. Shih,  VP, Mobile Business Group for Chunghwa Telecom (CHT) made a number of savvy comments regarding the drivers for femtocells. He was optimistic about using femtocells to solve hard coverage and capacity challenges in Taiwan while still cognizant that technical challenges are currently being worked. Georg Loeffelmann, Group CTO Area/Conceptual Planning for Mobilkom Austria, one of the more cautiously optimistic operators in the room coming from the engineering side of the house, asked whether Femtocells for capacity or coverage? Even amidst his skepticism surrounding femtozone applications, his answer was that it depends on the situation and that femtocells can be used for either capacity or coverage. In the end, Mobilkom Austria appears to have one of the more successful mobile broadband businesses in Europe and would like to use femtocells to offload capacity and continue its impressive growth.
     
    Mobile Broadband
    Karim Taga from Arthur D. Little (also from Austria) gave a comprehensive view of the mobile broadband landscape in Europe including what femtocells mean to cable operators. Karim’s data showed that Europe is enjoying a boom in mobile broadband with countries such as Austria leading the way. The success of mobile broadband extends beyond Europe as operators from Asia reported similar data. The remarkable factoid is that much of the mobile broadband usage comes from home. Operators know this because the traffic is evenly distributed across the network and follows a similar pattern to broadband traffic in the home (peaking late at night). Subscribers are using data card services at home even though they may have a broadband connection with Wi-Fi as well. The reasons for this behavior are frankly puzzling but it is a clear trend that requires further analysis. Operators were speculating that this may be from (a) the simplicity of using one connection wherever you are (b) the plug and play nature of the USB dongle obviating the need to configure your home Wi-Fi network (c) the low cost of both mobile broadband AND the broadband connection, and (d) the increased freedom (net neutrality) offered on the wireless networks.
     
    As a final note, Mike Thelander from Signals Research Group (SRG) gave an impressive follow-up talk on the business case for femtocells. SRG’s most recent work shows that for the average mobile broadband user (using just over 1 GB of traffic), a compelling business case for the operator emerges based on network cost savings alone! This result follows the presentations that were given in by Randy Luening from SRG at the MWC in Barcelona showing that the customer lifetime value often doubles across a number of scenarios and market segments across the globe. Working closely with the Femto Forum, SRG have created a very comprehensive model of the business case proposition for femtocells. This model will soon be available for members of the Femto Forum and the 100 page white paper will be available for anyone to download on the website.

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