Wireless broadband:
global experiences of users
Ewan Sutherland
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National Broadband Summit, Washington,
DC, 27-29 April 2003 Wireless broadband: global experiences of users Ewan Sutherland |
| Introduction |
Mr Chairman Thank you very much for the invitation to speak here today. As a foreigner it helps me to learn about the domestic US debate and also allows me to contribute an international perspective, one based on global best practice. I want to give a very explicitly global view of developments in broadband and where wireless fits into the broader picture. My text and slides will be on the INTUG web site as soon as I can find a hot spot. I have managed to be in South Africa, Hong Kong, Japan, Australia and a bunch of European countries and it is only April. Like Sam Paltridge from the OECD and Taylor Reynolds I was in Geneva for an ITU Workshop on Broadband a couple of weeks ago. Broadband is a subject of intense interest around the world, not least in where countries stand compared to one another. People are aware that 10Mbit/s or 100Mbit/s can be delivered to the home or the coffee shop for US$20 or 30 per month. There are already a few hundred ADSL lines in Nouvelle Caledonie, with satellite to connect to the Internet. INTUG is a global body, representing users around the planet. We share best practice and how to overcome the obstacles to getting there. We have heard the half-truths peddled by incumbent operators and we have countered those arguments. We know from users in the leading countries what is going on. We are neither going to be fooled nor are we going to accept the second rate or the third rate. Financial markets saw wirelines telecommunications as boring, as being so 1980s. They continued to think mobile was exciting until 2001 with the dot.bomb. Since then they have considered the whole telecommunications sector to be dead. The only remaining investment by venture capitalists has been is Wireless LAN companies and this seems to teeter on the edge of irrational exuberance. The balance between wireline and wireless broadband is a very strange one. It varies enormously, depenidng on how the fixed operators are regulated and how they behave. Where they have been able to capture regulation, then fixed broadband remains expensive and the prices steeply graded in order to protect leased line revenues. It also forces rivals to use wireless, rather than unbundled local loops. As the discussion in the international panel made clear, the price competitiveness between offerings in different countries varies enormously. Too many countries are still log-jammed in narrowband, whether wireline or wireless or both. Some operators are even trying to pass off unmetered ISDN as entry-level broadband. The operators are to too busy defending revenues from leased line, from ISDN and from additional lines used for computers. Just as IP telephony is a threat to the revenues of the traditional fixed operators, so Voice over Wi-Fi or WiFone or whatever you want to call it, is a threat to the mobile operators. We are also seeing the potential to deliver data by Digital Audio Broadcasting (DAB) and Digital Video Broadcasting (DVB). I am not sure that anyone really knows how this will play out, but IP datacasting looks to have an interesting future. A crucial factor will be the features and the technologies included in the consumer devices. I do not think any one country or continent has all the elements of global best practice. Indeed, one of the messages is of the individuality of each success story. There are common elements, but also specific factors which have caused the successes and failures. |
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| Asia |
Nonetheless, the highest concentration seems to
be around the East China Sea. Some simple figures:
In Asia there are hundreds of millions of customers with GSM (a purportedly obsolete French technology). The majority of those individuals are without a fixed line. This is an enormous challenge if they are to be provided with broadband. One approach will require massive wiring of apartments and that will give maybe 300 million people 10 to 50Mbit/s, 100Mbit/s if the fibre is taken into the residence. However, it will require the deployment of wireless technologies for many of the rest for primary access. For all it is has potential for residential access and public access. It is a considerable challenge and a business opportunity. |
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| Fixed Wireless Access |
One of the strange and almost mysterious
failures has been Fixed Wireless Access (FWA). Spectrum and licences have
been assigned in any number of countries, but it is very, very rare to find
a customer and a viable service. There have been some successes as voice, for example in Sri Lanka. However, there are few examples of success as data and several failures. In the UK, Her Majetsy's Government has found a solution in "easing" the planning rules concerning unsightly masts and antennae. The UK has what was, I think, the first WLL bankruptcy in the form of Ionica. Sonofon was an interesting case. It is a well established Danish operator for mobile telephony with customers, masts and backbone network. It obtained licences for FWA and proposed a national service. Suddenly, the SBC-affiliate, the Danish fixed incumbent, discovered ADSL and switched on a service which offers 256kbit/s for almost US$ 50 per month. Arguably one of the worst broadband offers in Europe, but enough to kill Sonofon's FWA offer dead. Without competition - the Danish incumbent owns a significant part of the cable television network - it can get away with such offers. There have been some quite ugly collisions between CDMA/WLL for voice telephony with mobile telephony. In India GSM licences were issued and had only very modest success. The fixed incumbent operators then began to deploy CDMA-WLL for telephony. Gradually, they tried to edge into limited mobility and attack the market for "mobile telephony", albeit with limited mobility. It is interesting regulatory and market dynamics. Similar problems have emerged in South Africa. |
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| WLAN |
Global best practice for Wireless LANs is
to make available both 2.4GHz and 5GHz bands without licences or, if this
impossible, with very broad class licences. WLAN is already one of the features of the avant garde household. It is a useful and eventually essential add-on to a fixed broadband connection. For the home with multiple PCs and domestic appliances such as:
We are seeing widespread adoption of WLAN in businesses, despite well-publicised security problems. There are vast numbers of lap-tops which come with WLAN pre-installed. This is pushed hard by Intel. The business models for public services using WLAN hot-spots seem to vary enormously. Most obviously in the scale of their deployment with the result that in DC you have seek out a hot spot, but in Seoul and Tokyo they are found easily. This is because tens of thousands of hot spots are being deployed. However, Cometa Networks seem to be about to remedy this. It becomes easier to find hotels and conference centres with WLAN services, also airports and railway stations. As I indicated earlier, one reason that this is easier in South Korea and Japan is that the hardware and the lines are cheap and easily available. Adding 10,000 broadband lines to a network of a few millions costs close to nothing. They also have a large customer base to whom WLAN can sold as an additional service. The other aspect is that you have millions of customers familiar with "real" broadband at home. You can sell broadband in public spaces to these people. Very rapid deployment is essential in order to create a consumer market, it also creates demand for new devices.
Source: Broad Group
It is clear that in South Korea and in Japan, hot spot access is being sold as if it were an extension of the residential broadband market and it is priced accordingly. It is not presented at rocket science and priced at NASA rates. In South Africa, the incumbent operator claims a right to all telecommunications that cross a property line, self-provision is forbidden. ADSL costs about US$ 100 per month for 256kbit/s downstream. Consequenly, there is enormous interest in WLAN not only for theobvious uses, but also for point-to-point and serving business parks. Of course, SBC in the shape of Telekom South Africa, is doing everything it can to suppress this technology. |
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| 2.5G and 3G |
I could talk for hours on the failures of
mobile telephony. I could go into the cartel that is behind the
pricing of international mobile roaming and SMS. Nobody every thought you
could make money out of the signalling channel, it was pure overhead. Or
the abuses of fixed-to-mobile call termination, the extra fifteen or twenty
cents you pay to call mobile phones in Chile and Switzerland, Japan and
the United Kingdom. I just hope George W was not making calls to Tony's cellphone. Though given the nature of the relationship, maybe Tony was calling George W. I never understood why people were so surprised by the success of SMS, it is only a personal telegram device. Maybe I have read too many noneteenth century novels, but people were forever sending telegrams. You do not have to be an engineeer to realise that SMS can be provided by a device and a network considerably less sophisticated than GSM. For example, the Blackberry in North America runs on the bi-directional pager network. There are enormous opportunities for consumer electronics manufactuers here for Wi-Fi. devices Table: GPRS and EDGE data rates.
Looking at the tariffs for GPRS, we can see just how high they are:
Looking at SingTel, the roaming prices range from US$7 to almost US$ 20 per megabyte. Firstly, I am not at all sure that we are accustomed or want to buy in Megabytes. Secondly, we can become so sloppy, throwing around enormous files, that these prices look outrageous. I could talk about the great wave of enthusiasm that lifted 3G up almost to the heavens and then cast it down again. Despite claims of complementarity, there is clear and demonstrable competition between 3G and WLAN for:
From the other direction, we are seeing the development of Wi-Fi phones such as the Cisco 7920 and the Spectrum24 NetVision. The enormous doubts about 3G have undermined the development of applications and handsets. In turn their absence or paucity, provides negative feedback. |
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| Conclusion |
There is a constant need to identify global
best practice in:
The alphabetic variants of IEEE 802.11 seem to have killed off HomeRF and also Hiperlan. They seems to have done some damage to 3G. However, much less than was self-inflicted as a result of greed and gullability. The 3G stock offers look increasingly like those mail messages we get from people offering us money from Nigeria. Doubtless, the advocates of free markets will claim this is evidence that markets work. I would be much more cautious. WLAN enthusiasm in the USA seems to be driven in part by the failure of fixed line broadband. It is the regulatory success of the RBOCs that has driven people to look for alternatives. Naturally, the bureaucracy is a bit slower. We are still waiting for a lot of countries to assign the spectrum for WLAN and to support both 2.4GHz and 5GHz, also for Fixed Wireless Access. The ITU's World Radiocommunication Conference (WRC-03) should help. Nonetheless, the desire to issue wholly unnecessary licences remains strong in many countries. The South Korea and Japanese business models are of a single platform offering "any time, any service, any device" across ADSL or cable, or WLAN or 3G or whatever else comes to hand and is available and cost-effective. It is supported by a cluster of business drivers in cheap and ubiquitous broadband, fierce (if not always sustained) competition and consumer electronics manufacturers. Thank you very much for your attention. |
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