Addressing Femtocell Integration Challenges

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1 Addressing Femtocell Integration Challenges Manish Singh VP, Product Line Management

2 Key Business Drivers Key Challenges

3 3C Stifling 3G Adoption Coverage, Churn, Capacity Unhappy Coverage Customer Base 3G suffers from inadequate indoor signal penetration Consumer spends ~ 60% - 70% time in indoor environments Poor Coverage = Poor Voice + Poor Video + Lower Data Rates Churn Consumer paying higher price for 3G / HSPA expects high quality of service Poor coverage increases churn Churn = ~ $100/month ARPU Loss + ~ $400 New customer acquisition cost Capacity Indoor users transmitting at high power High Power = Low Battery Life More Cell Sites = Higher OpEx + CapEx Tough to be a 3G carrier Top Line Hit Bottom Line Miss

4 Key Business Drivers Revenue Forecast for US Mobile Users Mobile Broadband Driving Growth Wireless data services are now a $115bn global market, growing at 28% annually, contributing ~2 pts to aggregate telecom services revenue growth outstripping fixed Source: Merrill Lynch 2007 broadband revenues and growth Source: Merrill Lynch 2007 $ M Source: IDC Voice Data TeliaSonera Mobile Broadband Traffic Grew ~ 400% in 1yr 600% 500% TeliaSonera's Data Traffic Growth in % 2 billion mobile broadband users by % 200% 100% Femtocells Accelerate Mobile Broadband Demand 0% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Source: TeliaSonera at LTE Summit 2008

5 What Is Driving this Growth? Demographics Devices Demand Internet Generation: Years Old Internet-Ready Devices Internet Applications & Content Ideal Conditions for the Perfect Data Storm

6 BUT, Consumers Want MORE for LESS The Era of Flat Rate AT&T and T-Mobile on Tuesday moved quickly to match Verizon's $99.99 all-you-can-eat wireless Following the lead of its competitors, Sprint Nextel Corp on Thursday unveiled a $99.99 pricing plan that gives customers plan, leaving just one big carrier Sprint Nextel on the sidelines. Source: USA Today, 02/18/2008 unlimited minutes, text messages, , Internet access and other wireless service applications. The new plans will give Vodafone customers reliable and fast unlimited access to their favorite social network Source: Kansas City Business Journal, 02/28/2008 sites, and the whole of the internet... Price / Bit MUST Go Down!! Source: Vodafone, 05/1/2008

7 FemtoZone Services Beyond Voice and Data Parental Control Home Entertainment 3G / IMS Core Home Security Macro Network Base Station Nanny Monitor Digital Home Home Automation Monetize Dead Minutes Service Integration Real-Time Notification Real-Time Monitoring

8 Femtocell Network Rollouts Capacity Femto in 2.1GHz Rural Femto in 2.1GHz Sub-urban Femto in 2.1GHz 3G / HSPA Networks in 2.1GHz GSM / GPRS / EDGE Networks in 900MHz / 1800MHz Urban Femto in 2.1GHz Dense Urban Demand based Capacity / Coverage Nation-wide Network Coverage Low Broadband Proliferation High

9 Key Business Drivers Key Challenges

10 Network Integration Challenges: IP RAN vs SIP / IMS Architectures Iu-CS Iu-CS IP-RAN Tunneled Iu Security Gateway Iu Concentrator Iu-PS MSC Iu-h Security Gateway Femto Gateway Iu-PS MSC Tunneled Iu SGSN New Iu-h SGSN AAA System (e.g. HSS) IuCS MSC IuCS SIP / IMS Iu OR Iu-h Security Gateway Diameter Femto Gateway SIP RTP IWF AS CSCF MGC MGW IuCS IuPS 3G RAN IuPS MSC SGSN Gn GGSN Gi Packet Data Gateway Gi Wi Wm IMS Call Control Cx AAA System (e.g. HSS) SIP Iu-to-SIP FGW SGSN SIP in FAP

11 Trillium Repertoire Loaded Control Application Forwarding Application Control Application Forwarding Application IP-RAN Stack Manager RRC PDCP RLC MAC-b,MAC-d,MAC-sh MAC-HS,MAC-ES MAC-E* RANAP SCCP M3UA SCTP Iu-UP GTP Stack Manager RRC PDCP RLC MAC-b,MAC-d,MAC-sh MAC-HS,MAC-ES MAC-E* RANAP HNBAP RUA SCTP Iu-UP GTP PHY IP (IP Sec) PHY IP (IP Sec) Tunneled Iu New Iu-h Control Application Forwarding Application CC/MM/GMM/SM Forwarding Application SIP / IMS Stack Manager RRC PDCP RLC MAC-b,MAC-d,MAC-sh MAC-HS,MAC-ES MAC-E* RANAP SCCP M3UA SCTP Iu-UP IuCS GTP IuPS Stack Manager RRC RLC MAC-b,MAC-d,MAC-sh MAC-HS,MAC-ES MAC-E* PHY PDCP SIP / RTP TCP / UDP SCTP IPSec PHY IP (IP Sec) Iu-to-SIP FGW SIP in FAP FAP: Under the Hood

12 Good News: 3GPP Standardizing Iu-h Iu-h interface between FAP and FGW Architectures remove SS7 bottlenecks Scalable to add ~100Ms FAP Support Iu-Flex with NNSF in FGW Two Finalists RANAP / RUA / SCTP + HNBAP OR RANAP / SCTP FAP Iu-h New Iu-h Stack Manager New Iu-h Security Gateway Control Application RRC RLC Femto GateWay MAC-b,MAC-d,MAC-sh MAC-HS,MAC-ES MAC-E* PHY PDCP Iu-CS MSC Iu-PS SGSN Forwarding Application RANAP HNBAP Iu-UP RUA SCTP GTP IP (IP Sec)

13 Femtocells Cost Challenge The 4 th C Femtocell is the compelling solution to the 3C Challenge If it can meet the 4 th C = Cost Low per-unit cost for Femtocells is a MUST 4 th C Solutions Software and Silicon Integration Custom silicon addressing femtocell requirements Software integrated with silicon to meet the performance needs CPE Device Convergence STB+Femtocell, Residential Gateway+Femtocell Drives BOM cost down through higher level of integration & component re-use Delivers True Quad-Play: Voice + Video + Data + Mobility

14 CPE Convergence: Fixed / Mobile Operator Example Customer Premises Wireline Secure adsl / FTTX Network ( Mbps) Fixed Voice Internet Access IPTV Mobile Voice Wireless Untrusted Access Network (Security? QoS?) The New Paradigm Secure adsl / FTTx Network ( Mbps) Set Top Box Femtocell Customer Premises Mobile Voice Fixed Voice Internet Access IPTV Femto-enabled STB Compelling IPTV story True Quad-Play Reduced Churn Increased ARPU 100% Secure = more content Managed QoS reused for voice 4 medium blended applications Drives ROI for FTTx build out Huge CapEx / OpEx savings

15 All-IP Network Challenges P2P Traffic - Wireline ISP s Nemesis DPI Service Delivery over All-IP networks Traffic Shaping will P2P traffic clog Mobile Broadband Networks? QoS delivery of real-time voice, video, data over IP network? Securing All-IP networks Security DDoS Ever-emerging New Threats IDS, IPS Unlike wireline, wireless networks are limited by access capacity

16 Traffic Management Challenges IuCS MGW PSTN MSC-Server GMSC Tunneled Iub RNC IuPS Internet NodeB SGSN GGSN IuCS MGW PSTN MSC-Server GMSC FAP Internet Tunneled Iu Security Gateway FGW IuPS SGSN GGSN Internet Direct Tunnel Traffic Offloading

17 Will Wireline DPI Solutions Fit NGMN? Today s Wireline DSLAM CMTS DPI Box DPI Box Bump in the Wire Tomorrow s NGMN Bump in the Wire is NOT right for NGMN Another box additional CapEx, increased OpEx Increases round-trip latency another network hop DPI function MUST be embedded in Femto Gateways Access Networks DPI Enabled Femto Gateways Same problem, but need a different solution

18 Conclusions Key Business Drivers for Femtocells Coverage Capacity Growing Demand for Mobile Broadband Key Challenges for Femtocells Cost CPE Device Convergence Traffic Management DPI! DPI!! DPI!!! Network Architecture Harmonization New Iu-h State of the Femto Nation Multiple trials in North America, Europe and Japan Major commercial rollouts in 2009

19 Thank You femtocell.html