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LTE Focus: Small cells and app ecosystems are key to success

By CAROLINE GABRIEL

Published: 11 September, 2009

READ MORE: Application Environment | Femtocell | LTE | Wi-Fi

As might be expected at such an early stage of a technology's life, this week's LTE Focus conference in Amsterdam raised as many questions as it answered, especially about the thorny problem of how carriers are going to make a profit from mobile broadband. Alcatel-Lucent made the case for the mobile industry - cellcos, vendors and their new partners - keeping control of mobile Web 2.0 with an ecosystem geared to new services. Others took the view that Google, Apple and the rest are doing a fine job of coming up with the applications, and operators need to use LTE to create a cost efficient fat pipe - probably shared with other cellcos, probably offloading less attractive traffic to other systems. Two of the few points of agreement - 2014, not 2011, is the year for LTE to hit mass markets; and success will depend on ever smaller cells.

Houston Spencer, ALU's VP of solutions and marketing in northern Europe, made the point powerfully that "we have a bad track record of identifying applications" (by "we" he meant the industry as a whole, not ALU itself, whose many contributions to wireless, via Lucent/Bell Labs, were rather poignantly recalled). But the Bell Labs offices are largely gone now and the 'next big thing' is more likely to come from Silicon Valley or even China, some argue. Not if ALU can help it - its new mission is to be the hub of a new ecosystem, it recently announced ng Connect, which makes friends of those web services players and creates a climate to foster innovation that can be leveraged by cellcos using their new networks.

"Anybody still tied to the idea of a linear value chain - you stake your place and pay rent at one end and collect rent at the other - is fooling themselves," he said. "That only works for the 'killer app' - which you know about upfront and know how much to charge." He said nobody has a clear idea of what the applications will be that make LTE successful so a big all-embracing ecosystem is needed to pool expertise and ideas, test and simulate potential apps in real trials - "this is not just about ideas".

Areas that he believes have strong potential for carrier controlled mobile broadband include new forms of media, enterprise collaboration, e-healthcare, digital signage, cloud computing and in-car systems.

Steve Rayment, CTO of carrier Wi-Fi vendor BelAir Networks, was taking the opposite view - that cellcos need to accept the open internet and the new web services players and find more cost-efficient ways to boost their capacity to cope with smartphones and other new devices. This means offloading a great deal of traffic from a cellular macro network that will always be limited in capacity, even with LTE, if operators do no secure large swathes of spectrum. Currently, BelAir offers a Wi-Fi based offload option and has a 52% share of the installed base of carrier-controlled WLans, including the Wayport network recently acquired by AT&T, and Cablevision's huge network of Wi-Fi access points around its New York/Long Island/Connecticut territory (which has reduced its cable churn by 9% and, Rayment claims, carries more data than Verizon Wireless' entire national network.

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