Mobile operators face a massive increase in network cost due to mobile data explosion
May 16, 2012 // Jean-Pierre Joosting
The tremendous growth in mobile data traffic — Solon Management Consulting expects a more than 15-fold increase between 2011 and 2016 for Germany alone — will put strong pressure on operators.
Mobile operators face significantly higher cost for providing additional network capacity. According to the Solon white paper "Mobile Data Growth: How operators can handle the traffic explosion" which is being released today, the cost for access and backhaul network could almost double within five years. Solon recommends a set of measures that will enable operators to provide bandwidth in a more cost-efficient way.
"Mobile operators need to act now to meet the mobile cost challenge," warns Stephan Kalleder, Principal at Solon and author of the white paper. Without adequate countermeasures, network expenditures will increase from 12 per cent of revenues in 2011 to 23 per cent of revenues in 2016 according to Solon estimates. "Since voice revenues are expected to grow moderately at best, the future profitability of mobile operators is strongly determined by how quickly they can improve the network cost base," says Kalleder.
Mobile operators can take two major approaches to significantly reduce the risk of cost outstripping data revenues: optimization of the existing infrastructure and network sharing. Network optimization concentrates on expanding network capacity through the migration to LTE and on actively managing data traffic. If mobile operators accelerate the LTE deployment, they will benefit from additional spectrum allocation and higher spectral efficiency. In addition, Solon proposes to more actively manage data traffic through implementing different tariff and policy models or by offloading mobile traffic to fixed lines. Another focus is on optimizing video delivery since mobile video consumption is likely to drive around 70 percent of the anticipated traffic growth over the next five years.
Entering into network sharing agreements has proven to be a highly successful strategy especially for smaller to mid-size operators. "By sharing the same infrastructure — from base stations to backhaul, mobile operators can save up to 35 per cent of the cost of the shared site," says Kalleder.
If operators adopt the proposed infrastructure and network measures, Solon expects operator's EBITDA margins to remain fairly stable. "At the same time, mobile operators need to develop new revenue and tariff models," adds Marc Sier, Managing Director at Solon Management Consulting. "Monetizing data is a big challenge but finding the right pricing models and opening up new revenues streams such as M2M or partnership models will enable operators to close the revenue gap and even increase profitability."
The Solon Telecoms white paper "Mobile Data Growth: How operators can handle the traffic explosion is available for download.
Optimized RF Silicon-On-Insulator (SOI) drives monolithic integration of multi-band radios
June 19, 2013
STMicroelectronics has developed a silicon-on-insulator (SOI) CMOS process that can integrate all the RF functions of multi-band ...
Fully certified FlexRay transceiver enables ESD robust in-vehicle communication
IoT will be next silver screen, says media exec
Hard drives to hit billion-dollar mark by 2017 in video-surveillance applications, says IHS
Li-ion energy storage technology helps make smart grid for Pellworm Island even smarter
Data Fusion: the next frontier of software integration
June 19, 2013
In the last few years, the functionality of our mobile devices has come so far that consumers now treat them more like personal ...
“Prototype to Production”, the new Digi-Key trademark
STMicro signs memory design agreement with Rambus
X-FAB optimizes 180nm process for portable analog applications
InterviewSilica moves to fast lane in Europe's LED market
In the booming market for LED lighting, electronics distributor Silica intends to lead the pack by offering technological excellence at application level. The company is currently planning to offer tailor-made ...
Filter WizardCheck out the Filter Wizard Series of articles by Filter Guru Kendall Castor-Perry which provide invaluable practical Analog Design guidelines.
Linear video channel
READER OFFERRead more
The SoCKIT evaluation kit is Arrow's latest development tool, featuring an Altera Cyclone V SoC with a dual-core ARM Cortex-A9 MPCore processor integrated within its 28nm FPGA fabric.
Altera SoCs allow embedded system developers to differentiate their end product with customized hardware and software, and extend the product lifecycle through hardware and software updates in the field. This month, Arrow Electronics is giving away five SoCKIT evaluation kits featuring Altera’s ARM-Based SoCs, worth €249 each, together with the free entrance to one of Arrow’s SoC workshops organized throughout Europe.
And the winners are...
In our previous reader offer, Freescale Semiconductor was giving away five IMX6Q, Sabre-lite kits, worth £128.06 each.
Lucky winners include Mr. X. Salada Sole from the UK, Mrs A. Peric from Germany, Mr Z. Janosy from Hungary, Mr D. Gacina from Croatia and Mr B. Boris from France. All should be receiving their packages soon. Let's wish them some interesting findings with their projects.
December 15, 2011 | Texas instruments | 222901974
Unique Ser/Des technology supports encrypted video and audio content with full duplex bi-directional control channel over a single wire interface.