Network Sharing Helps Mobile Operators Cope with Exploding Data Demand

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," Kalleder stated.
 
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.

Written by Kevin Kutcher at 09:00
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