Questions & Answers

How are sales via the channel going so far this year for you? Do you predict that this year is going to be better than last year, and if so, by how much? If not, why not?

Andy Tow, Avenir Telecom managing director:

If I had to make a prediction I’d say, yes, we are on course to increase channel sales year on year. Why is this? Because in 2010, our channel will have all of the recession-busting tactics in place that we carefully set out and trained on last year. Tactics such as cross sell, up sell, customer loyalty schemes, working with individual resellers on the 80/20 rule, and so on.

Our channel partners have taken all of these to heart and the result has been a quantifiable decrease in customer churn (which O2 will testify to), an increase in sales, and a resilience to recession and downturn.

There is a lot more activity around 4G, or long term evolution (LTE), this year. What steps is your business taking towards the roll out of 4G? What technologies are you looking at using (ie, VoLGA)? When will the UK have 4G networks to play with, and what opportunities will this make for mobile dealers?

Andy Tow, Avenir Telecom managing director

Keith Horsted, GTeq channel development director:

Déjà vu, it’s started again, the great 4G media hype and the associated confusion that goes with it. At a cost of over £22 billion for a 3G licence and the continuing roll out of 3G networks, why are people are already talking about 4G? Are the networks ready to scrap their investment and adopt a new technology?

There is no doubt that the advent of smartphones has increased mobile data usage to the point where some networks are creaking to the point where something has to be done to maintain or even enhance the customer experience. One option is to enhance the network capabilities to provide greater data speeds, quality of service and even traffic prioritisation, so that customers can download more and more information and even hold mobile video conferences. It sounds simple, but the 4G standard has yet to be agreed and the commercial and technical issues have yet to be resolved.

There are five different technologies associated with 4G. They include the following:

Keith Horsted, GTeq channel development director:

orthogonal frequency division multiplexing (OFDM), which splits the signal into different frequencies; mobile WiMAX, also know as 802.16e; ultra mobile broadband (UMB), also known as CDMA 2000 EV-DO; multiple-input multiple-output (MIMO) wireless LAN technology; and long term evolution (LTE), which is designed for GSM/UMTS-based technology and is said to support 45Mbps to 145Mbps in current test networks.

Each technology has its own pros and cons, but it is likely that LTE will be the preferred option in the UK, as it requires less investment to work with existing infrastructure.

However, one of the main disadvantages of any packet switched wireless network , such as LTE, is that voice calls and SMS messaging, the main revenue generators of mobile network operators, are no longer available, as they are based on a circuit switched radio and core network infrastructure. Consequently, it is likely that there will be some fallback mechanism to support these functions. This could include the use of voice over LTE via generic access (VoLGA), which effectively connects the existing mobile switching centres to the LTE network via a gateway. VoLGA is based on an existing generic access network standard (GAN) that allows mobile access over generic IP access networks, such as WiFi. Orange already deploys this technology, so its future adoption should be relatively straightforward if the other networks decide to follow.

Telefonica has chosen O2 UK to test the 4G concept and claims that in ‘ideal conditions’ download speed of ‘up to’ 340Mbps could be achieved; however, the reality is somewhat different with actual download speed ‘in excess of’ 140Mbps being achieved in a recent trial. Services could be available towards the end of 2010, but the cost and commercial model associated with the new technology are not available, so it is difficult to know how compelling any switch might be.

Tim Deluca-Smith, WDSGlobal vice president of marketing

LTE is a much talked about next generation network technology. However, LTE isn’t without its detractors. Roll outs suffer continuous delays and many critics have suggested that its standards and protocols have been designed without consideration for the user experience.

One of the main concerns lies with how the technology handles voice. In the long term, the goal is that voice will be carried as VoIP through IP Multimedia Subsystem (IMS).

However, in the short term there’s a patchwork of work-arounds being debated, the most favoured being Circuit Switch Fallback. This simply means that the handset will ‘fallback’ to a 3G network if a user wants to make a call; but this has latency issues and may threaten the stability of a data application that’s open and connected to the LTE network.

Importantly, support for LTE within handsets is likely to begin with the smartphone segment. This exposes valuable enterprise users and early adopters to a potentially questionable user experience. Such devices are also built to multi task. Will tasks that require a consistent IP connection to the cloud tolerate a fallback or radio handover?

For all of the infrastructure deals that are announced and the huge investment being made by operators, surprisingly little attention seems to be given to the potential burden on customer care and the user experience.

Tim Deluca-Smith, WDSGlobal vice president of marketing

Tow, Avenir Telecom: My own view is that the technology is a complete red herring. The end user isn’t interested what is being used, or how technologically superior it is. They want to know what it does, how it benefits them, what it does better, faster, more efficiently or more cheaply. It is the application and the marketing approach that will win sales, not the technology itself.