1 From “Walled Gardens” into the “Telecom Chaos” Key trends in Contemporary Communication Systems Jens Zander Director, Royal Institute of Technology, Stockholm

Outline – Technology track Key trends and challenges (JZ) Key area: Infrastructure (Jan Markendahl) –Mobile Broadband and the ”Revenue Gap” (”teaser” today) Key area: Services & user behavior (Zary Segall) –What would Google do ? Meeting 2: Networks & Services (Gerald Maguire) Meeting 3: Personal logistics & Terminals (Mark Smith) Meeting 4: Infrastructure deployment (Jan Markendahl)

3 Part I: Key challenges & trends

4 Trend 1: Much more for (even) less

The Long term Vision: Wireless - A “Disappearing” Technology Penetration Time Exclusive ”Everyone” has it Vanishing (”Hidden”) technology ” Things that communicate” Personal & home networks Mobile access anytime – anywhere 1 device/person 10 devices/person devices/person

6 Trend 1: (Much) More for less First fixed IP access – then mobile access Vision 2000 Mobile Web-browsing – the multimedia service platform Interactive information services Streaming audio/video Rich exponentially growing content Adapted to small terminals + Location & context aware services + Same price as mobile telephony TODAYs reality: Same price as home-ADSL Mobile telephony prices dropping Take-off was delayed – but happening now

7 Traffic volumes rapidly increasing Flat rate tariffs create data traffic boom Typical users: –EDGE 50 MB/month –HSPA 800 MB/month Revenues are not following. Example: Data traffic + 300% Revenues +11% Traffic Revenue Time Voice dominatedData dominated Revenue gap Volume (”major operator data”)

8 Why is it so expensive ? High bandwidth Wide Area High speed mobility & lossless handover Real time/low delay 1 Mbit/s at GSM service quality  times more expensive The 4 cost drivers

9 The street light analogy Why are parts of Sweden dark at night ? –Technical limitations ? –User demand ? –Economical limitations ?

New ways to provide low-cost capacity Technology: Not an issue ! Business model: Cooperation ! 10

11 A new ballgame from “full coverage” to capacity (Klas Johansson, ”Cost Effective Deployment Strategies for Heterogeneous Wireless Networks”, Doctoral Thesis, KTH 2007)

12 Cost drivers Transmission Site buildout, installation and lease Base station equipment, RNC, O&M and power Greenfield deployment (Klas Johansson, ”Cost Effective Deployment Strategies for Heterogeneous Wireless Networks”, Doctoral Thesis, KTH 2007)

13 The convergence point – the multimode terminal Moore law works for electronics – not for physical infrastructures Life-cycles –Terminals: months-years –Infrastructure: years-decades Terminals will –”always” contain the right mix of ”tools” and use the proper spectrum –Tailored to customer & application needs GSM/GPRS/EDGE/WCDMA/HSPA/WLAN/DVB-H/LTE ”Quadruple-band”

14 Trend 2: Bits are just bits and can be produced anywhere – now also in the mobile domain! Services provided by anyone - except the network operator ?

15 Open IP access- ”Intelligence Outside” ”Dumb” IP- connectivity ”Dumb” IP- connectivity ”Intelligent Network” IMS ”Intelligent Network” IMS Service 1 Service 2 Service 3Service n Content provider User Terminal Service 1 Service 2 Service 3 Service n Content provider User Terminal High QoS Simple Terminals Low flexibility High cost Required for new demanding applications End-end principle Best effort High flexibility Low cost Mature application platforms The Walled Garden The Outback

16 Computing in the cloud Arbitrary distribution and physical location of resources: –Computation –Storage –Sensors –…. ”Infinite” bandwidth Services not tied to neither networks nor access

The changing value chain Affecting industry players Telco operator vendors consumers ’90s and before today and the future Telco operator vendors evolved users

Mobile services.. ”over the top” Sufficient mobile bandwidth: Services ”over the top” (IP) No need for networked services New Actors: –Apple (Appstore) –Google (Android Market) New Service paradigm –Try & Buy Death of SMS, Voice..? (Google Talk ?)

19 Some consequences: Mobile TV Mobile TV – –Operator provided service –Streaming –Real-time –Existing TV-content is dead ! Personal Multi Media –Individual personalized content –Non-real time – on demand –Time-shifting is ”out there” and lives - but without access operator intervention! Mobile TV ISDN WAP

20 Questions for discussions Where is TS going in mobile ? –High quality bit-pipe provider? –Content aggregator –(e.g. Mobile entertainment) ? –Generic IP based Services –Business solutions ….

Part II: Challenges and potential Showstoppers ahead ….

The Challenges & potential ”Showstoppers” Spectrum ”Shannon” Energy Cost Complexity – Reliability Legal issues Health Hazards ? New business models ?

Do we need more spectrum for wireless access services ? Basically no: Higher data rate – short range communication But: More spectrum – cheaper systems – less energy Low power Low Infrastructure Cost Spectrum Efficiency

Opportunistic (Overlay) Access (”Cognitive Radio”) Dynamic Access Modes for White Space Access ? Underlay Access (”UWB”) Temporarly unused spectrum, ”holes” Primary users

Business implications ? From ”exclusive ownership” – to commodity Lower price of spectrum due to –Increased supply of spectrum –Increased interference from secondary users Easier access to spectrum - more competition More difficult to guarantee service ? New spectrum business models ?

Energy Global scale: –Energy consumption of IT-technology not neglectable (2% of CO 2 -emission) –3G technology example Base station RF output (at antenna): 60 W Power input: 6 kW (Efficiency 1%) Reason Spectrum efficient – not power efficient Application scale: –More processing, more power- battery life does not keep up –Low cost low maintenance (disposable) devices _ extremely low power consumption

Storage Mobile Storage rapidly increasing –100KB  1TB.. and more Cost down –HD < 10c / GB –Flash < 1$/GB Always connected and everything stored centrally OR Everything in the devices ? New storage based internet paradigm ?

billion of users Complex networks Complex expensive devices Complex to use Does not scale billion of users and devices Even more complex networks Complex but in-expensive devices Simple to use and deploy Extremely reliable Affordable for everyone YesterdayTomorrow The Vision Complexity & Reliability

Some conclusions Key Opportunities: –Moore’s law keeps going: more memory, more processing in less space –Plug-and-play / Zero configuration systems Key challenges: –Energy – both global and battery life –Spectrum – plenty availblable but difficult to access –Complexity – Reliability

30