Setting the Pace for Mobility Innovation
Sanjay Rohatgi, Managing Director, Service Provider, Cisco India and SAARC
Today, more things are connecting to the Internet than people. Cisco's Internet Business Solutions Group (IBSG) predicts some 25 billion devices will be connected by 2015, and 50 billion by 2020. As per Cisco Visual Networking Index (VNI) global mobile data traffic will grow 13-fold from 2012 to 2017, reaching 11.2 Exabytes per month in 2017. In India, IP traffic will reach an annual run rate of 33.6 Exabytes in 2017, up from an annual run rate of 5.5 Exabytes in 2012.
The IP Traffic is going to increase at a major scale amounting to 33.5 Exabytes of information; and this increase is expected to come from consumers of which the dominant will be Gen Y. 66% of all consumer internet traffic will be IP video and mobile data traffic will grow 4X faster than fixed IP traffic. Video is a big contributor to this growth with over 4 billion hours of video watched each month on YouTube and more than 20% of global YouTube views coming from mobile devices. As it stands 94% of GenY likes to upload photos, 73% upload videos to share or store in internet sites. In India, total Internet video traffic (business and consumer, combined) will be 63% of all Internet traffic in 2017, up from 36% in 2012.
Consumer, content and mobility
All these numbers point out and showcase how the consumers are taking up content in a big way. The ever increasing demand for smartphones and other devices is generating staggering amounts of mobile data. Meanwhile 3G, 4G and Wi-Fi deployments are rising and the world is clearly shifting from coverage and capacity to service; and the importance of customer experience is rising amongst operators worldwide. The use of Wi-Fi for Internet access is exploding as more mobile devices are Wi-Fi enabled, the number of public hotspots expands, and user acceptance grows.
Distinctions between consumer and business services on mobile devices have become blurred. Wireless usage is shifting indoors. Network analytics show that the majority of mobile data usage - close to 80 percent - is indoor and nomadic, rather than truly mobile. Given the above, Wi-Fi is expected to surpass wired traffic; by 2016, 51 percent of IP traffic will be delivered over Wi-Fi networks. Global Fixed/Wi-Fi was 49% of total Internet traffic in 2012, and will be 56% of total Internet traffic in 2017.
The exponential growth in mobile traffic means that service providers (SPs) must manage their networks efficiently to meet increasing consumer demand for consistency and seamless data exchange. They should look for a solution ready for rapid, large-scale deployment. Technology architectures should be transparent, secure, scalable, and manageable and allow operators to finance, deploy, and start new services quickly.
In order to accommodate exploding network traffic and profit from it, innovative mobile solutions are needed. SPs need to optimize their network with the solutions that are cost-effective to offload large amounts of mobile data traffic, while delivering a host of new services. SP Wi-Fi solutions provide cost-effective coverage and capacity to meet the scale and quality required by mobile data users today.
SPs recognize that trend and see tremendous business opportunity represented by this shift because it relates to emerging monetization use cases that are propelling the market's rapid growth. SPs are expected to offer a differentiated experience to their customers and find new ways to engage with their customers. They are looking at delivering new, better and more personalized connected experiences, and gain more intelligence about the networked connections to deliver new revenue-generating services.
SPs are looking to harness technologies like cloud, manage OTT and enable BYOD and build an infrastructure for video, mobile, and cloud or managed services. They need a 'Network of Services', which deliver a more visual, social, mobile and personal experience to end users. An optimal mix of macro and Wi-Fi could be the Holy Grail. SPs are adopting Wi-Fi as an essential complement to mobile services, given the shift to Wi-Fi-enabled devices and increasing number of users choosing to connect to the Internet through Wi-Fi. This means, Wi-Fi could enhance customer experience and open up new monetization streams for SPs.
SPs are turning to Wi-Fi to complement their networks and seek solutions that enable subscriber data management. They are looking at Wi-Fi not just from the point of view of offload but also to meet the demand of businesses and consumers for connected services.
Several trends in the market are causing operators to incorporate small cell solutions into their network to help address mobile data traffic issues. Small cell technology solutions can be placed in locations where significant amounts of data are generated, such as shopping malls, stadiums, university campuses, and public transportation hubs and where subscribers spend most of their time besides their home and offices.
In addition to economies of data offload, SP Wi-Fi offers new monetization opportunities by taking advantage of the intelligence inherent in the network, including policy, hyper-location, and context, application, and device information. It helps in increasing SPs' revenue and market share through subscriber retention. With such solutions SPs can:
- Rapidly define new service plans using customizable, policy-building blocks
- Simplify policy control and service catalogue management
- Accelerate time-to-market for new service plans
- Increase revenue through market segmentation
- Improve customer satisfaction with personalized, tiered, and interactive services
For a long time mobile operators viewed the unlicensed spectrum and Wi-Fi as an extension of their fixed broadband business or as a complementary hotspot business, but not as a viable extension of their mobile business. Now, with transition from a mobile voice business model to a mobile data model, more and more tier-one mobile operators are taking a closer look at how to take advantage of the unlicensed spectrum and Wi-Fi as part of their mobile strategy. They realize that the operator with the best licensed and unlicensed strategy will deliver the most data service and the best mobile experience at the highest profit margin.
Wi-Fi has today becomes ubiquitous with most personal mobile devices, including smartphones, Tablets, cameras, and game consoles enabling a wireless connection. What's more, robust carrier-grade Wi-Fi networks have the ability to outperform 4G networks and are also secure; next generation hotspots offer roaming that is as transparent as cellular roaming. According to Cisco VNI by 2017, Global Fixed/Wi-Fi was 49% of total Internet traffic in 2012, and will be 56% of total Internet traffic in 2017. Customers seek a seamless experience akin to using a mobile phone, which transparently and invisibly transfers the signal from one cell tower to the next to provide uninterrupted services.
Companies like Cisco are working with the Wi-Fi Alliance and the Wireless Broadband Alliance, for the development of a set of new standards, called Next Generation Hotspot, to give users a seamless mobile experience with Wi-Fi. Increased adoption of SP Wi-Fi will be possible through widespread deployments, availability of user devices that support the technology, cost efficiency, capability to address new users and devices without mobile subscription (without a subscriber identity module [SIM]), spectrum capacity and standards availability for integration into mobile core networks.
Needless to say, Wi-Fi has created a large market opportunity for operators, and that opportunity is attracting increasing competition. As providers attempt to secure locations and launch services, the race to capture this opportunity will increase. As demand for mobile devices and network connectivity continues to grow, both Wi-Fi and traditional mobile networks will be critical to meet the needs of a growing number of 'mobile' consumers. Clearly SPs are in an enviable position to successfully integrate their networks and enhance customer experience. The need for them to transition is NOW!