Huawei Shares Nine Driving Forces of MBB – Exploring the Business Opportunities in MBB Era

Driving force 1: user experience

Going through different economic development stages, such as the agricultural, industrial, and service economy, society enters the experience economy era, in which user experience will bring the premium price, competitiveness, and differentiation. In the MBB era, the network with good user experience will attract more subscribers, higher service usage, and greater income.

As the mobile network flourishes and mobile data traffic increases greatly, traffic generates incomes for operators. In this situation, user experience on MBB services is a key factor to increase operators' revenue and has become the primary productive force. On the forum, Mr. Xu Zhijun, a Huawei rotating CEO, emphasized that user experience was the primary productive force and key to future success.

Mr. Wang Tao added that SMS and voice services were the main revenue sources for carriers in the 2G/3G era while user experience was equivalent to network quality and was not regarded as an independent concept. As the 4G MBB era is coming, user experience is subject to both the network and content distributions/sources and illustrates the quality experienced by users. In respect to user experience network optimization is both necessary and crucial to improve service performance.

Driving force 2: three seconds

Video and web browsing are two essential mainstream services in the MBB era. Service wait time is the most decisive experience KPI in human-machine interaction. According to the research findings of Huawei mLAB and university institutes, start timing when users click the play button. More than 95% of users can maintain good attentions within 2 seconds after the play button is clicked, and their attentions begin to distract 3 seconds later. When the wait time exceeds 5 seconds, 70% of the users can still maintain good attentions. However, when the wait time exceeds 9 seconds, only 20% of users can maintain good attentions.

According to the research findings, the MBB network can be classified into three experience levels based on the wait time. When users' wait time is less than 3 seconds, the network experience is excellent. When the wait time is 3 to 5 seconds, user experience is good. When the wait time is 5 to 8 seconds, user experience is acceptable.

In terms of how to control users' wait time within 3 seconds, Huawei insists that carriers, content suppliers, and smartphone manufacturers need to cooperate with each other. For example, content suppliers can adapt the content to terminals' requirements while carriers can enhance network performance reduce network delay.

Driving force 3: video

As the main force to promote the network traffic growth, video services directly affect carriers' revenues. Carriers can explore more commercial modes based on video services. Huawei has collected statistics using the most popular movie The Amazing Spider-Man 2 on Youtube as an example. This movie lasts 2 hours 21 minutes and 35 seconds. During this period, videos at different bit rates are provided by content websites based on network conditions. When users watch a movie with different network experiences, the generated traffic gap is large. When the video resolution is 1080p, the used traffic is 6.37 GB. When the video resolution is 720p, the used traffic is 2.3 GB. When the video resolution is 360p, the used traffic is 0.58 GB.

More importantly, video services will remodel the entire MBB industry. It will redefine the pipeline, service mode and ecosystem. More and more carriers begin to acquire TV media or content suppliers or become their shareholders.

Eric Mauskopf from YouTube stated that by 2018 video traffic will account for 79% of the total network traffic, half of which is provided by CDN networks. Mobile video traffic will increase with a compound annual growth rate (CAGR) of 70%. In parallel, the bandwidth requirement of a video rises sharply with the video resolution evolving from standard definition (SD) to high definition (HD) and to ultra HD 4K. YouTube and its partners are improving the video codec rate to occupy less bandwidth and are investing key technologies to reduce the buffer time.

Driving force 4: mobile IoT

From 16 million connections 20 years ago to 7 billion connections today, human being is still the main body of wireless network connections. Wireless networking in the future will not only serve human, but implement interconnection between a person and object or between multiple objects. Widespread networks lay the foundation for building a fully interconnected world. Huawei predicts that the total number of connections in the world will reach 30 billion by 2018 and 100 billion by 2025.

Wang Tao said: "If we want to build an interconnected world with controllable cost, we need to constantly enhance network capabilities and explore what kind of internet of things (IoT) services can be provided by carriers." He pointed out that cellular technology and other technologies are required in a number of IoT application scenarios. Industries and applications involved in 5G must be expanded in the industry to increase market share.

5G is defined as the combination of the evolution of current technologies and revolutionary technology innovation. It is not only the infrastructure of the next-generation mobile communications network, but also the enabler of the future digital world. It helps build up a fully connected society and enables everything interconnected.

Driving force 5: sufficient spectrums

On the basis of annual traffic growth, IMT predicts that 1960 MHz spectrums are required within the telecom industry by 2020. Huawei emphasizes that regulators should allocate more than 2 GHz spectrums to the telecom industry by 2020. Otherwise, the industry will experience poor development. Especially for carriers, without sufficient spectrum resources, the network cannot be built at low cost.

Wang Tao said that bands lower than 6 GHz were the first choice in the industry and should be fully used. The international telecommunication union (ITU) proposes technical solutions related to spectrums lower than 6 GHz at WRC-15 in 2015 and technical solutions related to spectrums higher than 6 GHz at WRC-19 in 2019. Huawei insists that more spectrums be allocated to the telecom industry at WRC-15 and WRC-19.

In addition, unauthorized bands should be used. Licensed-assisted access (LAA) being tested by Huawei is a technology that MBB can be used on unauthorized bands.

Driving force 6: mobilization of enterprise services

Enterprise service revenues vary with the types of services offered by carriers. Revenues of enterprises providing basic telecom services are less than those providing commercial services. Huawei is devoted to aiding carriers increase their business service revenues, for example, by using LTE technology to build private networks for enterprises.

According to Huawei survey involving more than 1000 decision makers and experts, the most important factors affecting future incomes include MBB, cloud computing, and big data.

Driving force 7: software-defined mobile network

Due to the increasing demand for bandwidth, base stations need to support more bands in the future, which increases the network deployment complexity. In parallel, different applications possess a multitude of network requirements. Some of them may require traffic while some may require time delay. Therefore, network architecture needs to be more flexible and resources can be scheduled based on demands. At the market level, carriers are facing fierce impact of over the top (OTT) services. Therefore, an automatic, open, programmable network is needed to shorten the product go-to-market time and launch a new service quickly.

Wang Tao said that introduction of the software-defined network into the entire network architecture were the solution to the above problems, including software-defined radio interface.

Driving force 8: network cloud

The entire network cloud will maximize the benefits of the network function virtualization (NFV). Huawei has released NFV solutions, namely Cloud Edge, as an important part of SoftCOM strategy to provide NFV deployment capability for carriers.

Driving force 9: 4.5G

LTE will continually evolve to 4.5G over the next few years. Three targets for 5G proposed by Huawei include 1 ms delay, user rate of 10 Gbit/s, and 100 billion connections. Targets for 4.5 G include 10 ms delay, user rate of 1 Gbit/s, and 30 billion connections.