1. Experience voice in 4G Cartagena , 27 August 2013 Dario Talmesio
Experience voice in 4G Cartagena , 27 August Dario Talmesio Principal Analyst Operator Strategy

2. £1.3 billion annual revenue
Leading provider of specialist information and services to the academic and scientific, professional and commercial business communities.
Leading provider of industry analysis, technical training and events to the global telecoms and media business communities.
We are here today representing our Industry Research business, but beyond research ITM is also heavily involved in bringing together telecoms communities at events like this (over 120 each year) and also through our broad array of specialist telecoms training courses. It’s a unique mix of services that we rightly believe places us at the very heart of the global telecoms community.
On a bigger scale, ITM belongs to Informa PLC – a FTSE-120 company with 8.5k employees worldwide and 1.3 billion pounds in annualised revenue. Beyond the telecoms industry, we work across a large number of industry verticals, including health, pharmaceutical, financial services, agriculture, transport and others.
This gives us the reach and scale needed to operate profitably in today’s global markets.
£1.3 billion annual revenue
FTSE-150
9,000 employees
£80 million annual revenue
500 employees

3. About Informa Telecoms & Media
Informa Telecoms & Media delivers strategic insight, key market data and forecasts. We’ve been helping our clients make better business decisions for more than 25 years.
Our aim is to be accessible, responsive and connected both to markets we serve and our clients’ business goals.
We have 65 analysts in nine research offices offering pragmatic advice to the leading global operators and builders of communications infrastructure.
These analysts are informed, objective and a ready to apply practical ‘real world’ experience to your business challenges and opportunities.
So let me dive more deeply into providing an overview on Informa Telecoms & Media.
We deliver strategic insights, key market data and forecasts on the global telecoms and media sectors – something we’ve been doing for over 25 years now. We have been built by a number of strategic acquisitions over the years, but rebranded under the ITM brand back in 2005.
Ever since then, the ITM brand has gone from strength to strength and we enjoy stronger and stronger market recognition.
Our aim is to be accessible, responsive and connected both to markets we serve and our clients’ business goals.
Our analysts are informed, objective and ready to apply practical, real world experience to business challenges and opportunities.

4. Local knowledge, global understanding
65 analysts in 9 countries
London
Chicago
Beijing
San Francisco
Boston
Dubai
Riyadh
Singapore
We have always believed that our global reach has been key to our success.
In fact, our analyst team is structured quite differently to other research houses.
We have classic analysts focused on specific aspects of the market (e.g. networks, smartphones, content), but also have a 20+ strong teams of regional analysts. They track the day-to-day impact of macro trends on a micro-basis in their countries and regions of expertise.
This provides us a balanced overview of high-level industry trends on a global basis, but a unique understanding of the dynamics at an individual country level.
LTE is a good example – on a global level, it would be easy to think the whole world is transitioning rapidly to LTE, but obviously the picture locally varies enormously with wide-ranging strategic priorities being adopted by operators.
São Paulo
Johannesburg
Brisbane
17/09/201817/09/2018
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5. Our analysts

6. LTE connections by geography, 3Q12 ~90% of total global connections
Where is LTE today?
LTE connections by geography, 3Q12
~90% of total global connections
182 live networks in 75 countries (August 13)
Reaching almost 1 billion people
~125 million connections to LTE networks at 2Q13-end
Over 948 LTE-enabled devices, according to GSA
Global commercial LTE network deployments, August 2013
Number of LTE-enabled smartphones by operator, 2012-end 2012
Source: Informa Telecoms & Media

7. Today LTE is still a USA & Asia (success) story
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8. But LTE is at the top of everyone’s priorities
What will be the single most important area of focus for telecoms and TV operators in 2013?
Which technologies and strategies will drive profitable top-line growth in your organization in 2013?
Every year for the past 11 years, we have run a survey of telecoms and media executives to test their sentiment for the coming 12 months.
We call this our Industry Outlook and we typically poll opinion from up to 1,000 stakeholders from across all parts of the sector value chain.
The idea is to gain a clear view on:
priorities for the next year
Gauge the level of optimism that exists in the industry
Understand the strategies that will dominate
Identify key enablers – be they new technologies, business models or partnerships
This year was no different.
For the first time, we see that LTE has floated to the top of priorities. This is for a sub-segment of respondents from CSPs (carriers)
It is clear that LTE is seen as the most important focus.
Source: Informa’s Industry Outlook Survey 2013, Oct 2012, CSP respondents only, n=280
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9. What are the main challenges?
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10. And what opportunities?
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11. LTE to reach almost 16% Global penetration by 2018-end
LTE Forecast By region
Cellular subscription forecast - technology split for 2018
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12. LTE: Which operators have had the most success?
Top 10 largest LTE operators by connections, 2Q13
Not charging a premium for LTE over 3G is used by some of the most successful LTE operators, measured by subscriptions.
Main strategic LTE tariffing choice facing operators is: charge a premium over 3G (if so, how much?) or price LTE on a par with 3G?
LTE operators that charged a clear premium over 3G are adjusting their prices to bring them in line with 3G rates.
Operator
LTE connections
% of total base
Current premium v 3G (%)*
Verizon Wireless
31.1m 26  0
AT&T Mobility USA
17.3m 16
NTT DoCoMo
14.2m 23
SK Telecom
11.0m 41
Sprint Nextel USA
9.2m 17
KT Corp
6.0m 37
LG U+
5.9m 50
KDDI
5.3m 14
Softbank Mobile
T-Mobile US
4.7m 11
Operators that have priced LTE services at a significant premium to 3G have seen anaemic LTE subscription growth, while those that have priced LTE on a par or very comparably to 3G have seen the strongest LTE subs growth.
In the absence of LTE smaprtphones, operators in the Nordics for a long time priced LTE at a significant premium to 3G and as a consequence saw limited LTE subscription growth compared to the aggressive operators, for instance in the US, where operators were focussed on LTE smartphone growth soon after launch.
We’re also seeing operators make a real effort to simplify monthly tariffs with the launch of LTE. This simplification is taking many forms, from offering the same rates for 4G access as for 3G, to segmenting monthly data allowances based on the concept of size, eg, “small, medium and large”, which is what Rogers Wireless in Canada and Telstra in Australia are doing with good results.
*Lowest-priced LTE monthly subscription compared with lowest price 3G subscription
Source: Operators, Informa Telecoms & Media
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13. What are the lessons learned in how to position and market LTE to consumers?
Source: AT&T
Here are two screenshots from operator’s current 4G marketing, which emphasis not only speed, but “what you can do” with 4G.
The ambitious and most successful early adopters used LTE to improve perceptions about the quality of their networks and the performance they offer, and within this to compete on price. As more LTE devices come to market, operators will be able to differentiate more on the type and range of devices they have on offer. However, as happened with 2G and 3G, the similarity of operators’ device portfolios means that pricing and market positioning will be the principal ways they continue to differentiate in the LTE era.
Speed Coverage Latency demos on operator websites
What can users DO with 4G?
What are the end-user benefits?
How will their experience change?
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14. Are any “LTE services” emerging?
Vodafone Sky Sports & Spotify
Popular services used to promote LTE benefits
Consumer
Business
Download
High-definition video streaming and VoD
High-speed file transfers
Upload
Personal content sharing; consumer cloud applications
Enterprise cloud applications
Latency
Online gaming; real-time voice and video communications
Real-time voice and video communications; corporate VPN
EE Film
EE (UK)
Source: Informa Telecoms & Media
joyn
MetroPCS (US)
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15. How are consumers using LTE? How much data are they consuming?
25% of LTE usage is video, 15% music
43% of users use less or not public Wi-Fi
Customers on Vodafone’s fixed-broadband replacement service use GB per month
LTE accounts for 35% of total data traffic
LTE will surpass 3G traffic in early 2013
Users on MetroPCS unlimited LTE data plans consume 2-2.5GB on average per month
LTE smartphone users consume ~50% more data versus 3G smartphones
Average monthly LTE smartphone usage is 1.6GB vs 1.1GB on 3G
LTE smartphone users consume 8x more data compared to 3G users
Source: All data as reported by operators directly
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16. But consumers are also using IP-Voice and IP-Messaging service
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17. Selection of options available for LTE voice
Dual-mode devices: In this case, the handset includes two different modems. One
is used for CS voice, which is usually transferred over an existing 2G or 3G network
while data is enabled by the LTE network. Verizon was the first operator to offer these
handsets and is expected to have pushed handset manufacturers to include the easiest
solution for voice so that LTE smartphones will be available from the first day of the LTE
network operation. Although this solution allows for a minimal network disruption,
the handset’s real estate and battery life are major drawbacks. Therefore, this solution
is only expected to be short term, and more advanced LTE voice handsets are launching
in the market already.
• CS Fallback (CSFB): In this case, the handset establishes a circuit-switched session
when a voice call is initiated or accepted, thus anchoring the handset on the CS
network. This requires some integration with the MSC, an issue that has been
addressed by vendors plus anchoring the device to the 2G/3G network essentially
means that data is server by these networks too, thus limiting the data speed.
Nevertheless, CSFB is expected to be the major technology for LTE voice before VoLTE
is widely deployed due to its ease of implementation and the ubiquity of CS networks.
• VoLTE with Single Radio Voice Call Continuity (SRVCC): This technology is arguably
the most advanced and suitable for LTE networks. When in LTE coverage, voice is
packet-based but when a user roams out of LTE coverage, SRVCC allows for handover
to a 2G/3G network and to the CS domain. Although a delay of up to 800msec was
necessary to enable the handover in the initial SRVCC standard, improvements are
taking place so that the call delay is minimized. More discussion on SRVCC standards
can be found below, in the section on relevant standards.
• OTT VoIP: In this case, the operator partners with an OTT company to offer voice as
another data service over the LTE network. This solution would only work where LTE
coverage is extensive but it is possible that Tier-2 or Tier-3 operators could partner with
a widely-deployed
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18. Voice “for” LTE, VoLTE & the prospects for voice revenues
Will LTE rejuvenate the voice market?
Voice “for” LTE, VoLTE & the prospects for voice revenues
Selected early conclusions on voice for LTE
VoLTE branding in Korea
Live VoLTE deployments
SK Telecom (Korea), August 2012
LGU+ (Korea), August 2012
MetroPCS (US), August 2012
User perception of interim voice for LTE solutions has been “surprisingly” positive
Clear evidence of a shift to unlimited voice, e.g Verizon Wireless, EE, Swisscom
There is a deep level of scepticism about the ability to monetise VoLTE/RCS
“Rich” and “HD” voice services are “table stakes”, not premium services
The “business case” for VoLTE appears to be based primarily on spectrum usage efficiency
Operators are generally committed to VoLTE, but will not feel rushed to launch
Operators that begin to approach nationwide coverage will move quickest to VoLTE
Potential scenarios for voice
Operators will be able to charge a premium for VoLTE/RCS services
Operators will begin to win-back traffic lost to alternative providers
Operators will see some incremental increases in voice revenues
Best case scenario
VoLTE/RCS will have no impact on traffic erosion to alternative providers
Operators will be unable to charge any premium and prices will continue to decline
Voice revenue declines will continue and, potentially, accelerate
Worst case scenario
VoLTE/RCS will help slow the decline of traffic loss to alternative providers
Operators will not be able to charge any premium
Voice revenues will continue to decline, but at a slower rate
Likely scenario
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19. Metro PCS: first US operators to introduce VoLTE services in mid-2012
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20. SK Telecom: largest VoLTE deployment to date
HD Voice: Service name for VoLTE
- 4.5 Million Users (May 2013)
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21. Verizon: Roadmap to VoLTE’ s launch in 2014
Completed LTE Rollout (June 2013)
500th U.S. market covered with 4G
Verizon LTE now covers 298 million people across the U.S., reaching 99% of its 3G footprint  
LTE network is handling 57 percent of its total data traffic.
Deployment of small cells on late 2013
Now focussing on adding voice capabilities to the 4G network.  (VOLTE)
VOLTE to commercially launch in early 2014 with a more widespread rollout and not a series of market-by-market launches
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22. Operators Survey: Primary voice solution for LTE?
Source: The status of the LTE ecosystem 2013, Informa Telecoms and Media
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23. Operators Survey: When is VoLTE going live?
Source: The status of the LTE ecosystem 2013, Informa Telecoms and Media
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24. Primary voice solution for LTE?
Source: The status of the LTE ecosystem 2013, Informa Telecoms and Media
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25. Concluding remarks LTE is an evolution, not a revolution
VoLTE will gradually happen as a barer technology
Barriers are still there: coverage, penetration, roaming
Business case for VoLTE as a rich-communication enabler is still unproven but further developments are expected in
OTT-communication services are well established and will wok on parallel with operators’ services
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26. Questions?
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27. Informa Telecoms and Media dario. talmesio@informa
Informa Telecoms and Media @dariotalmesio Dario Talmesio Principal Analysts M: F: