Jeff Thompson co-founded Towerstream in December 1999 and serves as President and CEO. Prior to Towerstream, Mr. Thompson co-founded and was Vice President of operations of EdgeNet Inc. Jeff Thompson holds a B.S. from the University of Massachusetts.
Creative solutions are required to handle the staggering amount of mobile data traffic expected over cellular networks. Mobile offloading, in which best-effort Internet traffic is separated from high-value, delay-sensitive traffic is one answer. This requires different networks to work together seamlessly as one network with the goal of providing users with the best connection and service experience possible.
With the surge in popularity of smartphones, tablet devices, and the mobile web, one of the hottest topics among Internet providers and cellular carriers today is how to cope with the corresponding increase in data transferred over cellular networks. It is frightening to think that existing carrier infrastructure is not equipped to handle this massive amount of data transfer, which will only continue to increase as smartphones and tablets grow in popularity. According to data from NPD, smartphones made up 42 percent of all US handset sales in the second quarter of 2010, up from 28 percent in 2009. ABI estimates that nearly 90 percent of total mobile network data traffic in the US will result from smartphones by 2014, and Morgan Stanley estimates that within five years, half of all Americans’ web browsing will be done on mobile devices. Smartphones use 50 times the bandwidth of traditional cell phones, and the rollout of Long Term Evolution (LTE) networks is projected to only improve the bandwidth from 3G by approximately four times. These vast increases in mobile data traffic are forcing operators of wireless networks to consider more creative ways to handle such a staggering amount of traffic. Without effectively taking advantage of alternative technologies, handling this data on current networks is like fighting a tsunami with an umbrella. As we move toward a future where smartphones will outnumber traditional cell phones by 2014, it is imperative to find a more legitimate solution to deal with this data tsunami. Increasingly there has been a view among telecom professionals that operators should not bear the full cost of transporting low-revenue-per-bit traffic on expensive, optimized, mobile networks. More and more leaders in the space have been paying close attention to the concept of mobile offloading (or Internet offloading). The premise behind mobile offloading is to separate best-effort Internet from high-value, delay-sensitive traffic and manage each type of data accordingly. Currently most cellular sites have insufficient bandwidth behind them to handle 3G and 4G data. Moreover, these networks are already running hot due to the increased usage of the mobile web on smartphones. In order for an alternative network to be successful, it needs a carrier class backhauling capacity. In this article, I will examine potential solutions that wireless networks should be considering to cope with the reality of increasing data transfer so that these networks can continue to provide excellent, uninterrupted service to their customers. The commoditization of voice According to the CTIA, the number of text messages sent per cellular user increased by nearly 50% last year. Also in the last year, the amount of data in text, email messages, streaming video, music and other services on mobile devices surpassed the amount of voice data in cellphone calls. With changes like these and others increasingly leading to voice being commoditized, cellular companies have been forced to redefine themselves through new business models like prepaid or pay-per-use data plans in addition to selling applications through branded app stores. Since voice plans are becoming more and more competitive, and consumers can make phone calls at increasingly low prices through VoIP, cellular companies are trying to hold onto the old business model – where the bulk of their money was made through voice plans – for as long as they can. They are attempting to squeeze every last bit of toothpaste out of the tube before consumers turn away from high priced voice plans. As such, data plans are increasingly becoming the chief source of revenue for the cellular companies, and if it wasn’t for the rise in data ARPUs, they would all be nearing a financial meltdown. Revolution in hardware equals evolution in data transfer There is no doubt that smartphones like the iPhone and those using the Android OS, as well as tablet devices like the iPad, have revolutionized the way consumers of all ages access and interface with the web. Thanks to devices like the iPhone 4 and Sprint Evo 4G, for example, consumers now have the ability to interact with one another through video conferencing. Important for business and families alike, video chat is sure to gain in popularity as more and more devices offer this capability. With this advancement, however, comes a dilemma. Video chat necessarily drains bandwidth to work properly, and continued reliance on obsolete 2G, 3G, and fledgling 4G networks is not an adequate solution for users who want to take full advantage of video conferencing. This is one of the reasons that Facetime is currently only allowed over WiFi. Not to mention the majority of younger Internet users who increasingly demand access to the Web wherever they may be – whether watching streaming video while in the waiting room at the doctor’s office, checking NFL scores on ESPN.com while in a cab, or updating their Facebook status while on line at the grocery store. Some believe that WiFi will step in to solve the problem. According to a recent study by location-based mobile media company JiWire, for the first time in the US, the number of free wireless hotspots outnumbers paid WiFi locations – with 55.1 percent of public WiFi locations available at no charge to users. This represents a 12.6 percent increase from Q1 to Q2 2010; WiFi use in general increased 17.3 percent in the same time period. However, based on the current ad hoc system of free and paid WiFi hotspots around major cities in the US, networks and carriers must strive for a better solution. A robust WiFi network is needed to provide consumers and businesses with strong, reliable access to the mobile web. Let’s take this opportunity to dispel some common misconceptions about WiFi. First, newer WiFi units on the market have Quality of Service (QoS) built in for voice and video, and high-performance WiFi units can easily travel 1500 feet in an outdoor environment. Second, newer WiFi units possess excellent wall penetration characteristics in an indoor environment. Furthermore, antenna technology has also come a long way. MIMO and other smart antenna technologies not only provide increased ranges and penetration of WiFi signals, but also mitigation of the high noise floor concerns of unlicensed spectrum. WiFi is now capable of carrying up to 200Mbps (the older WiFi started at 11MB, 1 MB less than Verizon's new LTE network). When built properly, a WiFi network can be as reliable as the best cellular networks. Let me be clear, I do not think that WiFi is a replacement for the cellular networks, but it’s certainly a must-have method of assistance. The major carriers can no longer ignore these extremely fast, inexpensive WiFi networks and chip sets. However, WiFi networks capable of cellular quality must be built with QoS, reliability, and sufficient backhaul. WiFi networks must allow consumers to use their phones as phones – by supporting SMS messages in addition to calls – and not just as a hub to access data. It requires only a little more capital to support a carrier class network that experiences very low latency and can handle QoS. These networks must also improve in order to allow seamless connectivity and hand-off capabilities. For example, I hate it when my iPad constantly prompts me to join a WiFi network. This is far from user-friendly. Another common misconception is that if we were able to magically upgrade to 4G service tomorrow, all connection issues networks are experiencing would disappear. Under the current system, this is not likely. Instead, offloading data traffic to WiFi networks is a key item to get people off 4G networks and save some of that spectrum. We believe that WiFi is the quickest and most efficient solution to offloading this traffic and, as WiFi technology continues to mature, it will undoubtedly be able to handle the significant increase in bandwidth that is needed for an effective offload. The amount of data that next generation networks will need to handle is something that will only continue to build in the coming years as consumer adoption of smartphones and tablets increases, and there is no magic bullet solution. At Towerstream, we believe that 4G is not one standard, like Wimax or LTE. We think 4G represents an entire network consisting of LTE, WiMAX, WiFi, and femtocells all working together seamlessly as one network with the goal of providing users with the best connection and service experience possible. This is a goal that all networks should aspire to meet.