Bad neighbours? A comparison of LPWA technology options

Screen Shot 2016-05-11 at 10.24.43While the carrier community is celebrating the steady arrival of 3GPP defined cellular IoT that will enable the use of existing GSM networks with minimal impact through upgrades, there remains significant interest in alternative solutions in the unlicensed space.

Some of this interest comes from service providers who lack access to licensed spectrum, but the majority is being driven by use cases where the long range, extended battery life, and very low cost of Low Power Wide Area (LPWA) wireless technologies is a fundamental necessity. What is emerging though is a fragmented area of largely proprietary solutions, making it difficult for users to decide on which option best suits their particular use case.

The key approaches to unlicensed M2M connectivity can be split in to two groups: UltraNarrowBand (UNB) technologies; and those that employ some form of spread spectrum modulation (SSM).

Growth forecasts for the M2M market underline the need for these LPWA systems to be able to co-exist in license exempt spectrum and that any LPWA solution should be able to support  many connected devices – and this requirement is only going to become more important over time as the number of devices increases.

Real Wireless recently carried out a study that compared the levels of interference between networks using these two different physical layer architectures. This required us to model a scenario in which a UNB and a SSM network had overlapping coverage areas and various other sources of interference, including non-LPWA users, in order to study the ability of both technologies to mitigate interference.

This insight gained was that UNB and spread spectrum modulation networks can only effectively co-exist in very low capacity deployments. Shared channel operation, either between a SSM and a UNB network, or two SSM networks, would result in mutual interference and uplink blocking of both networks, except in cases of very low simultaneous user numbers.

In other words, the reality is that a SSM LPWA network architecture should be considered a ‘bad neighbour’, and multiple unlicensed IoT networks can only effectively share access to spectrum when they all also share a UNB architecture. However, given the number of use cases for these technologies, they will undoubtedly coexist in one location. As a result, this study has significant implications for technology choices in this important growth market.

To find out more about our study and approach to modelling of unlicensed IoT solutions, download our new white paper today.

Mobile coverage in rural areas – a step in the wrong direction?

Mobile_Phone_Mast_at_Two_Burrows_-_geograph.org.uk_-_272976The UK currently has around 54,403 mobile phone masts dotted around the country — many of which are on land leased to the major telecoms companies by local landowners.

4,000 leases are due to expire this year, and this could lead to serious consequences for  telecoms companies and consumers alike. In the absence of any regulation, lease renewal negotiations could lead to significant demands from landlords for rent increases in a large number of cases. Telecoms companies will then need to either pass on this cost to the consumer, through more expensive tariffs, or remove macrocells completely and create coverage or capacity gaps. The Telegraph recently wrote an article on this topic.

Macrocells are still vital to mobile coverage

Despite advances in small cell technology and Wi-Fi calling, macrocells remain the backbone of the mobile network, delivering the majority of the UK’s coverage and capacity.

There’s no alternative to macrocells, either, that doesn’t involve some form of relationship with a property or asset owner. In-building connectivity solutions like small cells and DAS do improve coverage and capacity in homes, offices and public buildings, but they will never replace macrocells entirely and do not provide wide area coverage in towns and around the countryside.

Operators need to protect their investment

Vital infrastructure is often expensive to provide and macrocells are no different. Operators naturally want to keep hold of their existing assets, given they’ve invested heavily in constructing macrocells in the first place.

Operators and landowners both know the difficulties with finding alternative sites for macrocells and obtaining planning permission and the time and cost associated with doing this would be significant — whilst the operators could resort to invoking code powers this is not a step that would be taken likely but it cannot be discounted completely as an idle threat.

How rent rises will affect mobile provision

The first impact of rent rises is likely to be felt by users in those locations where high costs force MNOs to remove macrocells, resulting in coverage or capacity gaps. Site closures aren’t going to happen overnight, though. MNOs will fight to keep their sites at rental levels that are either at or below the current level. But if landowners insist on increasing site rent by excessive amounts then users will no doubt have to bear the brunt of the costs through higher tariffs. Most likely the operators will pass some costs onto the users and absorb the majority but this will lead to less investment in new infrastructure in their networks and invariably lead to a negative impact on the digital economy generally.

Can the government intervene ?

The story of land rentals is an old chestnut in the mobile industry. The cycle of site acquisition, rental renewals and notices to quit will carry on as long the mobile industry exists — unless the government  is prepared to intervene to help regulate the rental levels that MNO’s pay for this essential infrastructure. At the same time, MNO’s need to realise that landlords and building owners should not have their genuine development plans for their land or property undermined by MNO macrocells that may have been on there for many years.

The reliance the British public currently places on their mobile communications and, within a few years, the reliance that the Police and other emergency services will have on their vital communications being carried by mobile networks suggests that this particular debate should be opened up and that representatives from the various parties (MNO’s Property owners and Government) can create a solid and sustainable basis that will help maintain mobile communications services throughout the UK.

Competition: the consumer’s friend?

For a relatively small country with 60 million inhabitants, the UK has four (or six, depending on how you count shared networks) operators competing for subscribers.

Add MVNOs in equation and the contrast between the UK and others – like the US – become readily apparent.

The immediate impact of this is good news for consumers. The options on offer mean UK operators need to prioritise low prices to stand out; in fact average revenue per user in the UK can be as low as a third of that in the US.

However the long-term consequences of this could well be hindering the UK – something that is often forgotten about when discussing how the market will develop.

Low pricing for consumers results in lower profitability for operators, which in turn means a lack of investment in infrastructure. This is compounded by the fact that constructing multiple networks results in an inefficient duplication of resources, which could otherwise be used to increase network coverage, capacity and performance.

So whilst we are a small country with a high population density, coverage continues to be a real challenge. Despite being nearly 40 times the size of the UK, the United States generally enjoys far more complete coverage.

Whilst consumers therefore see low pricing as beneficial and advantageous, in the long run they ultimately receive less ‘bang for their buck’.

With profit margins shrinking in a pricing race-to-the-bottom, operators are facing hard times. It’s not hard to see these figures leading to internal pressure for consolidation – which would in turn have a negative impact on competition.

Innovation too is hampered. After all, with multiple competitors watching your every move in an attempt to capitalise on any mistakes, can we blame any operator that doesn’t want to experiment with a non-proven technology?

One would hope that this situation would ultimately self-regulate, with operators folding in times of excessive competition and springing up when potential revenue is attractive enough, but the high stakes that are currently involved in entering or leaving the market make this unlikely.

But recent EC merger decisions suggest that we are beginning to see proactive steps taken towards resolving this. Rather than obsessing over operator numbers, the focus has shifted towards policing their behaviour at the wholesale level. The thought process being that this will encourage MVNOs to compete more intensely in retailing mobile services, whilst increasing efficiency in the underlying networks and allowing network operators to reap the financial benefits from greater economies of scale.

What is implicit in this is an increased recognition of the benefits that resource sharing can bring. However, I would argue that the EC regulators will need to start thinking about more the sharing of more than just networks.

By encouraging spectrum sharing we can begin to enable access to the wide channel bandwidths, that are likely to be necessary to meet future demand for mobile broadband, and avoid exacerbating the issues surrounding spectrum scarcity we may encounter in the future – something that Sweden, France and Mexico have already begun considering.