IP: The Way To Go?
By Carlo Longino, Thu Sep 13 00:00:00 GMT 2001

Internet protocol-based networks offer carriers huge benefits.

The build-up to 3G provides mobile operators a chance to take advantage of one of the hottest technologies in the mobile realm - all-IP (internet protocol) networks. Since circuit-switched voice accounts for the majority of traffic over existing mobile networks, circuit-based systems are clearly the best choice for today's networks. But tomorrow's networks must be optimized for data, making IP-based packet-switched networks the optimal choice.

Using IP transport technology not only makes it easier to deal with the bigger mix of traffic resulting from widespread use of data services, but also offers other key benefits: increased flexibility for expansion and growth, reduced network ownership and management costs, and rapid service deployment.

"Current mobile data services are relatively primitive and slow, and essentially unattractive to potential users," says Anthony Alles, CEO of network equipment maker Tahoe Networks. "The challenge is to break the mobility barrier for Internet protocols, and build the equipment necessary to enable the mobile Internet business case."

Cost savings

Instead of building proprietary, closed circuit-switched networks (or relying on leased circuit-switched networks) for backhaul and transport, carriers can take advantage of existing IP-based networks and the cost savings they offer.

For most carriers, transport and backhaul costs represent the second-largest network operations expense. These costs (which can often be up to half of all operations costs) continue to grow as the number of mobile subscribers grows.

Quality of service also becomes an issue, as an estimated 50 percent of mobile outages stem from backhaul failures, often on these leased lines.

This provides carriers with a choice that provides savings on either side. They can lay their own fiber networks and lease out their excess capacity, or merely lease bandwidth from existing optical network providers (of course, some carriers already own extensive regional and metro-area optical networks, such as KPN in the Netherlands through its KPNQwest venture).

As the price of bandwidth continues to decrease and the supply increases, leasing capacity is increasingly attractive. It also allows carriers to shed some of their engineering burden and concentrate on other aspects of their business.

This scenario also offers global carriers yet another advantage in the form of another economy of scale to exploit. A carrier with a global footprint can find a similarly global network provider and make international calls and data services as easy (and cheap) as sending a packet of data across a VPN is for other corporations is today.

Another area of cost savings comes through the use of so-called "future-proof" software-based network equipment. Investments will not be needed for costly hardware upgrades; innovation and new services will be dependent on software, not new switching and transmission equipment.

Capital investment will be focused on equipment that by being "smart" (in terms of its capabilities) will in a sense be "dumb".

Everything that flows through it (be it voice calls, text messages, streaming media) will merely be another type of data. Equipment will be able to deal with any type of data, sending it and leaving it for the end gateways and user devices to sort out. And any type-specific equipment in the network will be software-upgradeable to a large extent, providing for future technical innovation and growth.

Enabling services

"The driver for revenue growth in the mobile market is changing from adding new users to keeping existing subscribers and increasing average revenue per user (ARPU)," says PricewaterhouseCoopers telecoms consultant Noel Taylor.

"To do this means having to identify additional sources of revenue offered by 3G, from providing new services such as data and content to developing new business models involving multiple parties such as content partners and advertisers. Such new services are likely to be introduced rapidly due to the competitive nature of the marketplace and operational support systems (such as IP-based networks) need to be rapidly configurable to support new services and business models."

Service differentiation will be the key competitive metric in future mobile networks, and creating services that drive usage will be a do-or-die for mobile carriers. So anything that makes such services easier to develop and brings them to market more quickly is a must-have.

The first advantage of IP-based networks is ubiquity. Turn to an Internet service like Microsoft's Hotmail for an example. Hotmail's servers are fixed in a certain location and found by the use of specific IP addresses. Through the use of the domain name system, when a user types in "hotmail.com" in their browser, the browser sends a request to the Hotmail servers at their specific IP address, allowing access from any Net device, anywhere in the world.

But more importantly for mobile users, the system works in reverse as well. So when the Hotmail servers get the page request, they see it coming from a specific IP address and know that's where their answer to that request should be routed.

So what does this mean for mobile users? First, that roaming will work just as it should. By using IP addressing and IP-based networks, network-dependent features as simple as voicemail will work anywhere in the world just as they do on a user's home network. Just as a user can access their data on Hotmail from any network in the world, mobile users will have access to their home networks, data systems, and servers.

But an even more exciting side of this is the amount of personalization possible. The current IP standard (IPv4) supports only 4 billion unique addresses, most of which are currently in use. But IPv6 will use 128-bit addressing as opposed to the current 32-bit addressing, meaning there are an essentially infinite number of addresses available.

What this means for today's Internet user is that each time they log on, chances are they have a different IP address, leaving personalization dependent on cookies and other less reliable methods.

But using IPv6 will give each user's device a specific, permanent address, unlocking a world of personalization and the push technology that was supposed to dominate the Web several years ago. Also, the security measures inherent in IPv6 will allow for greater access to sensitive personal and corporate data.

"Wireless IP is much more than mobile users accessing stock tickers and sports scores," says Scott Hilton, a vice president at Lucent Technologies. "For example, mobile users will now be able to increase their overall productivity by accessing the mobile operators' network and work as if they were in the office, using e-mail, processing sales orders or collaborating with co-workers and suppliers."

Another new feature enabled through IP networks is the idea of IP mobility. The ubiquity mentioned above can be stretched even further when a user maintains the same IP address, but uses it on different networks and with different devices.

That is to say that when a user is in their office, they're connected through their PC to a LAN or wireless LAN and receive information and services that way. Then, on the drive home, their mobile device is connected via the mobile network, on the same IP address. But the network is smart enough to know that the user is on a mobile device at that time, so it tailors the information accordingly. Then, when the user logs on to their home PC at night, it is used as the conduit.

This is an exciting scenario for carriers and application providers. Since the IP-based network will be platform-agnostic (just as the wired Internet is today), any type of data can be sent across any part of the network.

But IP mobility is smart enough to tailor that data to the device using the address at that time. So e-mail, news updates, instant messages, and other kinds of data will be able to follow users around from network to network and device to device.

And this ubiquity is important, especially for messaging functions. "Messaging is rapidly becoming location and device independent, and mobility integration is critical for convenience of use and anywhere, anytime availability," says Ericsson Messaging President Sture Ostland. "Messaging-over-IP will rapidly advance the integration of voice mail, e-mail and fax mail and usher in a new era of advanced personal communication services."

High quality

But one question remains, certainly in the eyes of users - will all-IP networks be able to deliver an acceptable level of service? This concern looms large especially for voice calls, where voice over IP systems will be used to transform voice into merely another form of data.

VoIP systems are already in use, including several Web-based systems which offer long-distance and international calls at a fraction of the rate most telephone companies charge. They use the public Internet as a means of transmission, bypassing the more traditional undersea cables and satellites to cut costs.

But those cuts come at a price. Using the Internet, with its varied network topographies, traffic jams and bottlenecks, means that a call is only as strong as the weakest link across which it travels.

Sometimes even traveling a short geographical distance means a call has to leap across several networks, and calls to locations with poor infrastructure (like many of the countries that are popular destinations for web-based calls) are doomed to poor service.

But an important distinction must be made between these and other IP networks. VoIP applications (and all others) won't be sent out to mobile users across the Internet; they will run on managed, private networks that merely use the internet protocol as a means of transport.

So instead of users' calls fighting for bandwidth on the public Internet, they will be routed smoothly along a private, closed network.

IPv6 will also help maintain high levels of quality. The new protocol allows for packets not only to be prioritized, but also to be identified as part of a particular "flow" that needs to arrive in real time (be it a voice call or media stream), and can then be provided with a higher level of service relative to other, less time-dependent packets.

The optical networks likely to be used for backbone and transport functions in mobile IP networks have also long been capable of providing the "five nines" - the 99.999% uptime requirement of wired telephone companies - which surpasses the reliability of most current wireless networks.

Many of the general features of packet-based networks will increase quality as well. Since the services will maintain a constant network connection, gone will be some of the longest and most error-prone parts of today's mobile data services: dial-up, sign-in, and verification.

The layered architecture of IP networks will also help carriers maintain quality. The application layer, which houses all the applications and services, is separate and distinct from the control and connectivity layers. This keeps the elements that route traffic and control the network separate from applications and from each other, allowing for more complete control and better evolution of capacity and functionality.

All the transmission equipment is housed in the connectivity layer, keeping it out of the control layer. And in the same way, all applications and their servers are kept away from network transport layers.

The benefits inherent in such a layered IP network architecture combined with highly reliable optical networks, as well as the benefits of IPv6 combine to offer carriers a level of quality that will certainly exceed that of today's mobile networks.

So the way forward seems clear - the benefits of building an all-IP network certainly outweigh ditching legacy circuit-switched and traditional network equipment designed for a wireline world.

And as more carriers emerge and airtime becomes further commoditized, service differentiation will be the key to revenue growth and customer retention. Anything that can shorten the product development cycle and bring revenue-generating services to market more quickly will be a boon to operators.

And mobile IP can do just that.

Carlo Longino is a freelance writer based in Austin, Texas. His previous experience includes work for The Wall Street Journal, Dow Jones Newswires, and Hoover's Online.