Evolution to LTE in the Middle East will require DSI

Middle East operators know that brand innovation relies on the speed at which they adopt LTE. Concurrent to LTE investments should be investments in Diameter signalling infrastructure – critical behind-the-scenes communications necessary to make LTE succeed

Doug Suriano, CTO, Tekelec

Spending growth on network planning and optimisation for Europe, the Middle East and Africa (EMEA) is predicted to be less than half that of the Caribbean and Latin American (CALA) region, according to Analysys Mason research – with a CAGR in EMEA of 5.2 per cent compared to CALA’s 12 per cent for the period of 2011 to 2016.

However, does that reflect what is truly happening with LTE investments in EMEA and the consequent signalling increases that will come with it?

As EMEA mobile operators invest in LTE, a sophisticated signalling infrastructure will be required to handle the huge surge in Diameter messages triggered by LTE effectively. The LTE Diameter Signalling Index predicts that LTE Diameter signalling traffic in EMEA will see a 320 per cent CAGR from 2011 to 2016, making it the second fastest growing region in the world.

In comparison, according to the Cisco Visual Networking Index: Global Mobile Data Traffic Forecast Update, 2011–2016, mobile data traffic for the region will grow at a CAGR of 76 per cent.

The LTE Diameter signalling increase will require more sophisticated roaming arrangements than at present, concurrent data sessions, video streaming, QoS guarantees and behavioural changes via social networking. All of these trends will create exponential increases in diameter signalling volumes MNOs must manage.

Always-on smart devices and advanced services will require Diameter signalling to set-up data sessions, authorise subscriber activity, authenticate subscribers and accurately charge for data usage. The constant ‘pinging’ and orchestration will require that EMEA operators either proactively manage Diameter traffic now using Diameter Signalling Routers (DSR) at the earliest stages of LTE, or invest in DSR solutions once the network builds out.

Waiting could increase the risk of outages and add costs when deploying in markets where smartphone uptake is increasing and the sophistication of services is on the rise.

Middle East LTE deployments

According to the Global mobile Suppliers Association’s (GSA) Evolution to LTE report published on November 2, 2012, operators in Bahrain, Oman, Saudi Arabia and the UAE launched seven LTE networks, with Saudi Arabia leading the way with three. Since then, Zain Kuwait launched its LTE network, part of the eight-committed LTE networks planned across Bahrain, Jordan, Kuwait, Lebanon and Oman.

About 7.5 million Middle East subscribers will be on LTE by the end of 2015, according to a report issued by Signals and Systems Telecom, a market intelligence and consultancy firm.

According to the report, Saudi Arabia will account for more than 5.4 million subscriptions by 2015. That represents a CAGR of 197 per cent from 2011 levels. There have been LTE launches by all three major incumbents in Saudi Arabia – a market that was amongst the first to offer TD-LTE user devices commercially. Saudi Arabian mobile operator, Mobily, launched its first LTE service in the Middle East last year, followed closely by STC. Zain KSA has also made LTE announcements this summer about deploying in Riyadh and other cities within the eight countries it serves across the Middle East and North Africa.

Middle East LTE trends

As with the rest of the world, in the Middle East LTE brings new opportunities for innovative services, packages and personalisation. As Khaled Bassuny, senior vice president of customer care for Mobily said, “LTE will lead to completely new customer segmentation and a completely different brand to what we have today. The package that caters for your LTE customer will be completely different. We’re talking about new packages; new services; new promotions; new bundles; especially once we introduce 4G handsets.”

Each of these new offers and groups of services will likely require sophisticated management of network equipment and subscribers’ data plans – thus generating new Diameter signalling traffic. One-time location-based promotions, for example, will require communications with the subscriber database and the policy engine to determine a customer’s location and his or her willingness to receive advertisements. Alternatively, a shared data plan for a family or small business will generate Diameter signalling messages traversing between policy servers and charging systems to ensure accurate billing and account management.

Another business issue with LTE is how operators will collaborate with over-the-top (OTT) providers – a group likely to become even more appealing to customers as LTE spreads.

Several Middle East operators are considering the formation of a consortium to protect against potential revenue losses to OTT parties. This organisation would ‘create a global Arabic social networking platform’ according to Developing Telecoms. Such a platform would reach the world’s 350 million Arabic speakers. This would reduce the potential success of third-party OTT applications on a country-by-country basis, and allow the operators to maintain a greater share of customers’ voice, messaging, video and mobile data activity.

As Du CEO Osman Sultan said, "Network traffic doubles every eight to nine months, but revenue is heading to a plateau, so we need to claim part of the new revenues alongside OTT players."

As with innovative LTE services, a foray into OTT activity generates new Diameter signalling as well. If operators guarantee quality of service for video delivery or a VoIP call, for example, Diameter manages network resources.

A third key consideration is the introduction of Apple’s iPhone 5, the first LTE-enabled iPhone. As this phone becomes available in new countries, adoption will spur an uptick in LTE subscribers and their use of advanced services. Demand could be very steep. Analysys Mason wrote that ’the UAE grey market price soared to five times the recommended retail price’ upon its launch.

With the growth in iPhone 5 users will come new waves of Diameter traffic to authenticate and authorise new users, to roam between LTE networks and between LTE and 3G networks (when LTE coverage is not yet nationwide or available in an international country) and when accessing new applications and services that all consume data traffic.

Summary

As evidenced in the LTE Diameter Signalling Index, roaming, concurrent data sessions, video streaming, QoS guarantees and behavioural changes via social networking will drive Diameter signalling in the Middle East, the broader EMEA region, and other regions of the world.

As MNOs roll out LTE services, they will need to manage communication among multi-session devices and increasingly sophisticated networks. Diameter Signalling Infrastructure will effectively coordinate and orchestrate as long as it includes:

· Digital signalling routers

· Policy servers

· Online and offline charging

· Mobility management entities

· Policy control enforcement points

· Session management user data repositories

Those elements will comprise the New Diameter Network (NDN), which provides a more centralised approach (as opposed to a mesh approach) to effectively route, measure and monitor Diameter traffic.

The NDN will prove essential to EMEA operators, which must acknowledge the need to move toward service-oriented, all-IP networks if they are to support consistently growing business models.