Mobile Network Operators Must Address Data Costs to Remain Viable

By Erin Harrison August 02, 2011

Keeping up with mobile costs is a significant challenge for mobile network operators who will need to implement wider use of offload, optimization technologies to reduce operating costs, according to an industry report issued this week.

Even with the increased deployment and utilization of LTE networks, global MNO data delivery costs could increase to $370 billion annually by 2016, a seven-fold increase on their 2010 level of $53 billion, according to the firm’s latest research.

In order for them to financially viable, network operators will have to explore means of addressing data delivery costs and inefficiencies in base station operations, according to a new report from Juniper Research.

Future operating costs could be significantly reduced by the deployment of data offload solutions such as WiFi networks and femtocells, Juniper’s latest research asserts.

Dr. Windsor Holden, author of the report, “Mobile Operator Business Models,” said the case for reducing network inefficiency is both environmental and economic.

“By implementing solutions designed to reduce energy wastage, not only will MNOs markedly cut their operating costs but they will following sustainable business practices which reduce greenhose gas emissions,” Holden explained.

The report also identifies savings at the base station level, identifying both active and passive network sharing as a means of reducing site lease costs and reducing energy loss by using feederless sites and remote radio heads. Juniper’s research also recommended that “operators in developing markets that are reliant on diesel to power off-grid generators should accelerate their transition to renewable alternatives.”In related news, TechZone360’s Susan Campbell recently noted the growing phenomenon in mobile networking. Throughout the world there is increased spectrum, new devices, on-demand video content and thousands of applications that are all contributing to the explosive growth in the consumption of mobile data.

While this trend is not only adding more complexity to the overall customer experience, it is also taxing packet core gateways and backhaul networks.

Alcatel-Lucent’s “Achieving End-to-End Wireless IP” explores the challenges service providers are facing in the quest to design and build their networks to support peak usage. To complicate matters, that peak can be unique for each cell, depending upon the type of load and the time of day. Even these challenges can seem minor compared with the mobility of users.

Erin Harrison is Executive Editor, Strategic Initiatives, for TMC, where she oversees the company's strategic editorial initiatives, including the launch of several new print and online initiatives. She plays an active role in the print publications and TechZone360, covering IP communications, information technology and other related topics. To read more of Erin's articles, please visit her columnist page.

Edited by Rich Steeves

Executive Editor, Strategic Initiatives

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