The 4th generation: Reaping what we sow

With this year being heralded by experts as the true beginning of the region's 4G-telecom era, actually delivering more advanced mobile services is still a reality in the making. One of the executives at the forefront of the industry's transition is Yi Xiang, president of Huawei Middle East. The global ICT solutions provider has played a decisive role in progressing regional mobile technologies over the past decade, including all four of the currently deployed 4G Long-Term Evolution (LTE) networks in the Middle East. Talking exclusively to Arab News, he sheds light on a few of the challenges likely to intensify within the industry this year and which - unless handled tactfully - have the potential to make or break emerging communication platforms.
Consumers in Saudi Arabia today are not only vying for the latest in high-end consumer electronics; they are actually responsible for motivating the development of some of the world's most progressive information and communication technology (ICT) networks ever seen. Wireless networks in particular are laying the foundation for a new era of communications with global mobile broadband traffic likely to swell by up to 500 times within this decade.
The introduction of Long-Term Evolution technology (often just referred to as LTE) is particularly remarkable in this region today. One of the latest global standards in wireless communication, LTE is championed by many experts to be the clear successor to the telecom status quo, even dubbed by some as the first true fourth generation (4G) technology.
With the first LTE deployments in the Middle East having taken place within the last year, the potential benefits to subscribers are undeniably lucrative. For one, it takes into account that across the Middle East data is an increasingly larger part of our daily mobile consumption. LTE thus opens up enormous network capacity and enables significantly faster data speeds for accessing content on the go. Once established, the standards also simplify operators' own infrastructure and are relatively easy to scale out once. By reducing costs in this way savings can then be passed on as lower costs to the consumer.
This horizon may be teeming with potential, but the journey there has only just begun. The truth is that local operators, technology vendors, and regulators are all being challenged to reconsider many of their core operations in the LTE era. Experts are working in particular to confront three fundamental challenges - the allocation of more wireless capacity, the development of LTE-compatible devices, and how to monetize these new and enhanced services.
As we anxiously await the shift to better mobile communication, these challenges are likely to intensify before they are resolved. What then are industry players doing to cultivate long-term value for both themselves and their end users?
Managing the Wireless Farm
As legacy ICT networks are revamped by their newer and faster counterparts, analyst have warned repeatedly that operators around the world could see their plans to launch LTE hampered owing to the pace at which regulators have moved to free up additional wireless space, or spectrum. These resources are not inexhaustible, and the situation becomes even more complex as international and local regulations debate how much wireless spectrum is fair for any given population. For regional LTE networks in particular, providing enough spectrum will be crucial in managing (if not preventing) the interferences seen by everyday subscribers.
The act of spectrum re-farming, or the reallocation of existing & underutilized wireless frequencies, is one method that is being considered to address this dilemma. It may seem simple, but how do we measure underutilized, and do we risk cutting certain people off in order to connect others? The path forward is far from set.
Getting to the Device Level
As countries like Saudi Arabia look to enter the 4G realm, another crucial consideration is not just having enough wireless frequency, but agreeing on specific ranges to develop consumer electronics. The Global mobile Suppliers Association (GSA) revealed in a report this April that there are now approximately 347 LTE devices that have been unveiled globally, with routers, smartphones and tablets all taking a share of the market. It's big business to say the least. When a line of devices is programmed for a certain frequency range, changing that range involves costs of revamping both the network equipment as well as the devices themselves. The GSMA-one of the world's foremost industry authorities - recently detailed this dilemma in a 2012 report noting that by 2015 there will be 38 different frequency combinations used in deploying LTE. Illustrating this lack of harmonization as a significant challenge, the regional adoption of LTE might be stalled unless harmonized spectrum plans are agreed by device manufactures and regulators.
A Healthy Balance Sheet
When it comes to the bottom line, LTE transitions are also proving tricky as operators work to cost out their entire portfolio of mobile services.
Most mobile users will still continue to dip in and out of 2G, 3G and 4G coverage in their daily lives. LTE's extraordinary increase in both speed and bandwidth will also be compounded by the fact that many service providers are now pinning their growth hopes on subscribers taking up more extensive mobile data packages. Some operators have also been looking to drive revenues from working with the increasingly powerful third-party content providers using their networks, but again, this would require companies to move away from just charging for "access" to having completely new monetization tools.
In planning for network deployment, which of these various groups are ready to pay, and what they will pay for, is no easy measure.
The Path Ahead
This may all seem very technical, but what the telecom industry has not changed in the past decade is changing now - in a drastic way.
Transformation will clearly involve not just isolated efforts, but collective action through timely but necessary deliberation on each of these core issues. More detailed studies on local LTE deployments will also need to begin as the technology takes its first breath of air in the Middle East. Regulators will likely take on even more responsibilities in keeping 4G services competitive, with operators trying to balance wireless innovations with parallel investments in fixed, hard-line networks.
In a regional ICT market that analysts predict could be worth more than $ 170 billion by 2015, how these challenges are addressed - and by whom - will impact social and business communities far beyond the telecom sector alone.

— Yi Xiang is president of Huawei Middle East.