R9 per GB for mobile data?
Nokia Siemens Networks (NSN) believes it can offer technology to mobile network operators that offers users 1GB of data per day for $1 (US).
Karri Kuoppamaki, head of technology for Nokia Siemens Networks in Africa, told journalists at a press briefing in Sandton that this is the solution to their projection that the average data usage per subscriber will be 1GB/day by the end of the decade (2020).
According to their projections, there will be 10 times more subscribers and 100 times more traffic per subscriber than at the start of the decade, Kuoppamaki said.
“As an engineer, this explosion in data demand is exciting,” Kuoppamaki said. “It’s a new challenge for which we can develop new technology.”
From a technical perspective this has driven the industry to improve efficiency and enhance the architecture of networks. However, this is only one side of the coin, Kuoppamaki said.
“The other side of the coin is: how do you do that profitably? Is it possible to meet customer demand for more data and still do sustainable business out of it?”
To achieve their vision of enabling operators to provide low-cost broadband profitably, NSN relies on two products it recently introduced, Kuoppamaki said: Liquid Net, and its customer experience management (CEM) technology.
CEM is “taking network insights andturning them into ways to improve customer experience,” said Kuoppamaki.
Liquid Net, on the other hand, is trickier to explain. In brief, Nokia Siemens Networks says that Liquid Net lets operators move capacity around their network to where there is demand, using techniques such as beamforming.
Kuoppamaki said that this technology, in combination with a number of other external factors such as the availability of spectrum, will let operators profitably meet the demand for more data.
Karri Kuoppamaki
Asked to clarify their statement of providing to users a gigabyte of data per day at US$1, Kuoppamaki explained that they aren’t commenting about future pricing strategy, but about how much data users will be consuming in 7 years and what they will be paying for it.
“It’s hard to say what sort of pricing models will be in place 7 years from now”, Kuoppamaki said. “This is about what the price of consumed traffic will be at the end of the day.”
Challenged about how the capital investment in Nokia Siemens Networks technology factors into the price calculation, Kuoppamaki said that carriers are making big investments in next-generation technology with a large margin of uncertainty.
“Am I making the right decision for shareholders and will I bring value to customers? The answer to that question is not easy,” he said.
He was also asked if Liquid Net makes the planning of an operator’s radio access network (RAN) more complicated, to which Kuoppamaki said that it actually simplifies things to a certain extent.
Instead of doing capacity planning on a site-by-site basis, mobile operators can plan on a cluster or even network basis with Liquid Net.
However, it can be more complex, he added, which is why NSN provides software and services such as planning tools for heterogeneous networks.
Asked whether it wouldn’t just be easier for networks to stick with straight-forward RAN plan and keep charging ad-hoc rates of R1-R2 per MB, Kuoppamaki said; “Initially, yes.”
However, as traffic grows and demand increases, operators will need to do something to meet it profitably, he added.
“If you only take the easy path, you will pay for it in the long run,” Kuoppamaki said.
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