The explosion in demand for mobile data traffic is putting a lot
of pressure on network operators, particularly as they face
significantly higher costs for adding network capacity.
Moreover, the cost of providing access and backhaul network
infrastructure could almost double in the next five years,
according to Solon
Management Consulting, which in a white paper lays out a set of
measures that network operators can enact to provide bandwidth in a
more cost-effective way.
"Mobile operators need to act now to meet the mobile cost
challenge," warns Stephan Kalleder, principal at Solon and author
of the white paper.
Network expenditures will increase from 12% of revenues in 2011 to
23% in 2016 if adequate countermeasures aren't taken, Solon
estimates. "Since voice revenues are expected to grow moderately at
best, the future profitability of mobile operators is strongly
determined by how quickly they can improve the network cost base,"
Mobile network operators have two primary options when it comes to
significantly reducing the risk of cost outstripping revenue, Solon
says: optimizing existing network
infrastructure and network sharing.
The former entails expanding network capacity by migrating to LTE
and actively managing data traffic. Accelerating LTE deployments
will result in additional spectrum allocation and higher spectrum
efficiency. Benefits can also be realized by more actively managing
data traffic via different tariff and policy models, or by
offloading mobile traffic to fixed lines. Optimizing video delivery
is another potentially beneficial step to take as mobile video
consumption "is likely to drive around 70 percent of the
anticipated traffic growth over the next five years."
Entering into network sharing agreements is a second option for
mobile network operators, one that's proven highly successful for
smaller to mid-range mobile network operators, Solon notes. "By
sharing the same infrastructure - from base stations to backhaul,
mobile operators can save up to 35 per cent of the cost of the
shared site," Kalleder says.
Our partner NetAmerica Alliance
shares this vision and is built to bring these efficiencies to the
rural mobile market. Their shared 4G LTE network approach helps
rural carriers migrate to 4G at significantly less cost than a do
it alone approach.