Navigating Complexity - The Quest for True IPX

Sponsored by
October 2013
Navigating Complexity:
the Quest for True IPX

© 2013 Questex Media Group LLC
All rights reserved. No part of this
publication may be reproduced or
transmitted in any form or by any
means, electronic or mechanical,
including photocopy, recording,
or any information storage
or retrieval system, without
permission in writing from the
publisher.
04
02
09
17
18
13
14
06
12
Navigating complexity: the quest for true IPX
As the internet moves more and more into the mobile realm, mobile in
turn is moving more and more into the era of all-IP networks.
Key findings
Foreword
IPX – not just a network to interconnect operators – also a cloud based
platform to add new services
IPX connectivity grows
The majority of respondents (56%) say their company is connected to
an IPX now – up from one-third in 2011.
LTE roaming
LTE isn’t just about internet connectivity. Operators are also looking at
new service/revenue opportunities enabled by that all-IP capability.
QoS on the RAN
Few telco have actually launched QoS on the RAN, and almost half have
no plans to.
Future outlook
Methodology
Acknowledgments
VoLTE
VoLTE – still in the fledgling stage for most players – is being driven
mainly by efforts to improve cost efficiency and quality.
LTE: it’s still about speed
Almost half of those surveyed have launched LTE and the key driver,
not surprisingly, is higher data speeds.
RCS
While RCS is commercially ready, operators have been slow
to embrace it.
0302
Contents
LTE networks are growing at an extraor-
dinary rate as confirmed by more than 200
network deployments in just three years.
Data networks were first deployed in order
to promote demand for fledgling mobile
data services, but how things have changed!
These LTE networks are being rolled out to
satisfy a tsunami of mobile data demand. A
proliferation of smartphones, an explosion
of mobile apps and a savvier mobile user,
have all combined to create a shift in sub-
scriber expectations towards truly personal
and relevant interactions. These factors are
all coming together to cause disruption in
the telecom industry - for operators and
all the companies in their business ecosys-
tems. IP is changing the business dynamics,
services, network deployments and sub-
scriber expectations and IPX is enabling the
way operators, networks and services inter-
connect.
IPX enables three key aspects for an
operator: a seamless roaming experience,
scale and services. With a growing number
of domestic LTE networks, the next biggest
challenge for operators is to enable LTE
roaming so that subscribers can take full
advantage of the LTE speed and experience
while they are on the move internationally.
Operators want their subscribers to have a
consistently great experience and so they
should ensure that their subscribers con-
nect to LTE networks instead of falling back
to 2G/3G networks when roaming. As our
operator ecosystem is moving into an all IP
world, SAP Mobile Services is helping solve
these challenges. We successfully enabled
the first LTE roaming traffic flow between
China Mobile, Hong Kong and Globe Tel-
ecom, Philippines enabling subscribers to
enjoy LTE coverage whilst roaming. Over
IPX – not just a network to
interconnect operators – also a cloud
based platform to add new services
the last couple of years, we have seen the
number of operators connected to IPX grow
to a critical mass, and large scale IPX inter-
connection is now looking more like a reality
rather than a possibility.
The other key change with IPX is around
peering. IPX peering is an essential develop-
ment to expand roaming coverage and cre-
ate a seamless LTE roaming environment.
The recent LTE roaming Diameter peering
agreement between SAP Mobile Services
and Etisalat is a step in that direction. It
enables us to grow the IPX community, al-
lowing subscribers of Etisalat operator com-
panies to roam on SAP Mobile Services’ IPX
customer networks and vice versa.
As the first IPX service provider to
launch cloud-based RCS services over the
IPX connection, strategically, we see IPX
not just as a network to interconnect op-
erators in order to exchange data, signalling
and voice traffic, but also as a cloud-based
platform to add new services such as VoLTE
and RCS. With this cloud-based approach,
operators will be able to add new services
quicker and at a lower cost.
Since the last global IPX report in 2011,
there have been some significant changes in
the IPX world. There is much greater clar-
ity, activity and interest around IPX. The
adoption of IPX has continued apace. As
this year’s survey highlights, 57 percent of
operators are now connected to an IPX net-
work. Not only that, understanding of and
expectations from IPX, have progressed too.
We’ve essentially moved on from an indus-
try trying to understand the basic benefits
of IPX such as quality, privacy and security
to one that has specific demands and ex-
pectations from IPX implementations.
In this 2013 edition of the IPX Survey
“Navigating Complexity: The Quest for True
IPX”, the aim was to gain further insights
into subjects such as LTE, RCS and VoLTE
deployments as well as into focussed topics
such as QoS over RAN. Did you know that
30 percent of operators are not planning to
launch VoLTE services? And more than half
of the operators are going to launch RCS?
What does this say for the confidence in
VoLTE and RCS? Are these findings in sync
with your own opinions? It is questions like
these that this report seeks to address.
In order to delve into what the industry
is thinking and how they see IPX networks
evolving, Telecom Asia independently sur-
veyed about 170 respondents from within
the telecoms industry. To get to the heart of
the business needs of IPX uptake, the report
also includes insights from one-to-one dis-
cussion with senior executives in this space.
This unique report is not only useful
to those working with mobile services and
wholesale providers, but also to those work-
ing in the telecoms industry as a whole. The
report aims to enhance the knowledge base
of peers and customers and enable them to
build sound strategies around IPX. The re-
sults should provide you with a clear direc-
tion and critical information, equipping you
to drive deployments and revenue, generate
new revenue streams, plan for LTE roaming
through IPX and maintain competitive ad-
vantage in an IP-based world.
John Sims
President
SAP Mobile Services
Foreword

Introduction
04
As the internet moves more and more
into the mobile realm, mobile in turn is
moving more and more into the era of all-
IP networks. Much of this is being driven by
the rise of LTE, which is ostensibly an all-IP
proposition. More to the point, however, with
worldwide mobile data traffic set to increase
13-fold between 2012 and 2017, reaching
11.2 exabytes per month, according to Cisco
Systems’ Visual Networking Index, cellcos
are under pressure to address data service
delivery not only on their own networks, but
beyond them via roaming services. Compli-
cating the issue is the fact that most cellcos
have to support roaming for all-IP services
while also supporting legacy voice, SMS and
data services at home and abroad.
The mobile industry’s default solution to
the problem is IPX (IP Exchange), a concept
spearheaded by the GSM Association that
promotes common specs for end-to-end
IP traffic delivery and quality of service that
gives cellcos a cost-effective way to manage
LTE services across networks.
When Telecom Asia first researched the
topic of IPX in 2011, there was a lot of inter-
est in IPX but comparatively little activity.
At that time, the majority of operators were
in the planning stages of IPX, with deploy-
ments expected in the next one to three
years, pending the outcome of trials with
partners, and to an extent depending on the
progress of LTE rollouts, as many operators
saw LTE as the major driver for IPX. Also,
there was considerable debate over what
counted as “true” IPX.
Things have progressed quite a bit in
the last two years, as LTE rollouts have ac-
celerated and as a number of IPX providers
have arisen to help cellcos connect their
LTE roaming traffic quickly without going
through the laborious process of bilateral
agreements.
In 2013 alone we’ve seen a lot of activ-
ity surrounding IPX. In July, for example,
PCCW Global launched an HD video calling
service for enterprise customers and car-
rier partners over its IPX. The month before
that, BICS said it had performed the first
intercontinental LTE roaming connection
over IPX between Europe and Asia after
enabling Swisscom’s LTE users to roam to
Navigating complexity:
the quest for true IPX
South Korea, while Tata Communications
and Telecom Italia Sparkle implemented
what they billed as the world’s first LTE
roaming peering between two IPX provid-
ers, enabling both carriers to exchange LTE
roaming traffic on their respective IPX plat-
forms.
SAP Mobile Services, which enabled
the first commercial LTE roaming service
between Globe Telecom and China Mobile
Hong Kong late last year, entered into an
IPX peering agreement in August with Etis-
alat UAE, the largest operator in the Middle
East and Africa, to deliver LTE roaming traf-
fic to all of its mobile operators.
Meanwhile, May was a particularly busy
month for IPX activity:
• The GSMA and i3forum launched a de-
ployment initiative involving live com-
mercial pilots for voice traffic over IPX
conducted by Deutsche Telekom, Or-
ange, Telecom Italia, Telefónica, Telia-
Sonera and Vodafone. Both organiza-
tions said the pilots will “pave the way
for the technical and commercial agree-
ments necessary to use IPX to intercon-
• Over half of survey respondents say
they are connected to an IPX.
• Many operators are still at least one to
three years away from deploying IPX –
partly because it’s too soon, and partly
because the IPX services market is clut-
tered with players sending mixed mes-
sages over just what does and doesn’t
count as an IPX connection.
• However, a number of operators feel 2013
Key findings
nect any voice services”, and provide “a
major stepping stone toward interoper-
able communications services such as
VoLTE and RCS.”
• AMS-IX Hong Kong (established by
Hutchison Global Communications and
the Amsterdam Internet Exchange)
launched an Inter-IPX service to allow
IPX providers to peer IP traffic at the lo-
cal level.
• TeliaSonera International Carrier (TSIC)
launched its IPX service, with 200 PoPs
and support for TSIC roaming and
signaling and VoIPX, with LTE signaling
services and “a comprehensive suite of
additional IPX services” to follow later in
2013.
• Ooredoo in Qatar launched what it said
was the first IPX enabled network in the
Middle East using Tata Communica-
tions’ IPX+ platform. Voice is the first
app to be run on the IPX, with signaling,
data roaming (GRX and IPX) and LTE
roaming on the service roadmap.
will be the year IPX takes off as LTE prolif-
erates, demand for roaming support in-
creases and new services come online.
• Voice remains the most common ser-
vice running over IPX, but other up-and-
coming services include SMS, video and
GRX.
• It’s still early days for LTE roaming and
Diameter signaling, with a majority of
operators looking at other options be-
sides IPX to handle LTE roaming.
• Many operators see potential value in
VoLTE, and are more likely to use IPX
as an interconnect solution but still see
VoLTE as a near-future technology.
• Overall, operators have been slow to
adopt RCS services, but deployments
and trials are happening, and many see
it as a potential source of new revenue
and a ticket to competing with OTT ser-
vices. However, the key word is “poten-
tial” – many operators aren’t yet ready
to bank on RCS just yet.
• A number of operators are looking at
offering QoS in the RAN for latency-
sensitive services like VoIP and video,
but almost half of respondents have no
plans to implement it, as the technology
is too new. And wholesaling RAN QoS to
OTT players is, for now, right out.
With the bustle of activity on the IPX
front, we decided to revisit the state of IPX in
the mobile sector and gauge its progress. To
what extent are operators taking advantage
of IPX services? What value do they see in
IPX? What services are they running on IPX?
What services would they like to run on it?
And if they’re not using IPX, what are they
waiting for (besides perhaps an LTE license)?
The short answer is: more operators are
using IPX – but it’s still early days as opera-
tors work out their LTE strategies and try to
sort through what is, at the moment, a con-
fusing landscape of IPX services.
Introduction
05
Navigating complexity: the quest for true IPXNavigating complexity: the quest for true IPX

know claims more than 100 IPX connections
because they include ‘IPX ready’ connections,
instead of just real IPX connections. Some op-
erators in Europe have told me they have 400
IPX connections – because they name all their
voice connections as IPX-ready!”
Stone of Two Degrees confirms this is one
reason why his company is “in a holding pat-
tern”on IPX.
“We signed an SMS hub agreement with
someone,and they said,‘Fantastic,you’re con-
nected to our IPX!’ And I said, ‘Well, no we’re
not, we’re connected to your SMS hub’. ‘Oh
well that’s over our IPX infrastructure!’ I said,
‘Look, let’s not confuse things. I’m connected
to your SMS hub via an IPconnection.That is a
lot different from IPX’.”
Stone explains that it’s a definitional issue.
“When I think of an IPX connection, I think of
multiple layers of service, rather than a voice
connection, an IP connection or an SMS con-
nection as a standalone.”
If you asked operators two years ago – as
we did – if they were using an IPX network, the
answer was more likely to be no.Ask the same
question today, however, and the answer is
more likely to be yes.
Indeed, the majority of respondents to
our 2013 survey (56%) said their company is
connected to an IPX now. That may not be a
landslide in favor of IPX, but it’s a significantly
higher number than our 2011 IPXreport,which
found that only a third of operators were using
IPX.
Andrew Kwok, president of international
and carrier business for Hutchison Global
Communications, and chairman of Conexus
Mobile Alliance, says that interest in IPX has
grown as LTE network deployments have also
grown,thus driving greater demand for IPX.
“The industry’s been talking about IPX
for over eight years now, but at that time the
technology wasn’t mature enough,” he says.
“But now, the technology requirement for IP
is there, the customer desire is there and the
local access network is there, and we’re not
going to put that traffic on a traditional plat-
form or some internet platform, because we
need a higher standard of service quality and a
well-definednetworktocarrydifferentkindsof
apps and services.”
Kjetil Hanshus, VP of group relations at
Telenor Global Services – which is building its
IPX infrastructure now – concurs. “It’s been
about six years since I first heard about IPX,
but only this year am I seeing that it has gained
more momentum. More operators are inter-
ested now, and it will grow quickly now that
there is greater demand for data connectivity,
driven by end-user needs and expectations.”
Hanshus also predicts that some regions
will naturally grow faster than others – espe-
cially Europe. “In Europe, IPX has picked up
speed due to LTE kicking off interest in it,and it
will probably passAsia Pacific.”
For those who are connected to an IPX,we
wanted to know what services they’re deploy-
ing over it.
By far the most popular IPX service re-
mains voice (almost 80%) – which is only to
be expected since voice was one of the first
It’s also a question of suffi-
cient critical-mass coverage,Stone
adds. “The IPX world is about one
point for many services, and we
haven’t really seen anyone create
the critical mass where we can get
the reach we need from that provider.
That’s important to us because once you
transit more than one IPX, you’re effectively
doing off-net services. IPX-to-IPX is fine, but
when you get three IPXs in the chain,it defeats
the purpose of not having direct connectivity.”
Consequently,Two Degrees is“waiting for
the IPX market to whittle its way down from
the 50-60 people we see now to four, five or
six large operators.”
GRX vs IPX
Kwok says one benchmark for determin-
ing real IPX-readiness is Diameter support.
“We can install a DRA for a mobile operator so
theydon’thavetosourcetheirownequipment
to connect with us.If you’re not IPX-ready,you
cannot offer this. Otherwise you’re just offer-
ing pure IP transport.”
TheinterestinrunningGRXtrafficoverIPX
is significant because most operators expect
to be running LTE side by side with HSPA/W-
CDMA/EDGEtrafficforquitesometime–and
that is contributing to the confusion over what
counts as an IPX, because some operators
want to connect to GRX hubs and do IP inter-
services deployed over IPX in its early days.
Indeed, our 2011 IPX survey found that around
the same percentage of respondents at that
time was mainly running voice over their IPX
network.
Voice still dominates IPX
However, a number of other services are
fast catching up as IPX becomes more preva-
lent. The second most popular service is SMS
(45.5%), with video a close third (42%), and
GRXin the No.4 slot (almost 41%).
Interestingly, our follow-up interviews re-
veal that many operators do have very specific
requirements based on market expectations,
and IPX service providers are responding to
those demands. For example, Kwok says that
in addition to services like signaling, data
roaming (mainly LTE), VoIP (VoLTE) and bilat-
eral IP transport, HGC’s IPX service also sup-
ports BlackBerry.
“That’s a service you won’t find in the
GSMA’s recommendations for IPX services,
but we put it there because there’s demand
for BlackBerry roaming,” says Kwok. “We take
a market-oriented approach to IPX. If my cus-
tomer is pushing me to do this, I will bend over
backward to achieve that.”
A spokesperson for Telefonica Global Ser-
vices – which has already rolled out its own IPX
network – says that its catalog of services “is
not huge, since as yet there are not that many
commercialinterconnectiondealsthatusethe
IPX hubs.” However, he adds, “We have tested
RCS, VoIP and videoconferencing on our IPX.
We expect to see more activity in this space
toward the end of 2013 and begin to build in
2014.”
Telenor’s Hanshus says that the carrier
already has an SMS platform on its IPXand of-
fers SS7 signaling service, and will migrate all
its services onto IPX, including data roaming,
voice, and even international administration
services. “It is wise to connect our data cent-
ers.”
HanshusalsosaysTelenorGlobalServices
will interconnect with other carriers and fixed-
line platforms.”
For operators that haven’t started LTE
connect there rather than commit to a direct
IPXconnection,says Bell ofTelstra Global.
“That’s what a number of other people are
doing – IP-enabling their GRX,”he says.“In es-
sence you could define that as an IPX because
you’re bringing virtual IP into the exchange.
But when they did that, they were only get-
ting 40-50 kbps connection speeds. And we
showed them that when you connect on a na-
tive IPX backbone that can distinguish differ-
ent traffic types so you can protect high-value
services for the operator, you can get around
10-12 Mbps.”
Bell says that GRX is okay for operators
that don’t have all that much data traffic.“But
if roaming is a big source of revenue for you,
you don’t want your customers getting 40-50
kbps connections that are so slow that they
stop roaming and switch to Wi-Fi, because
then you’ve lost that revenue stream.”
That’s key, he says, because roaming traf-
fic for many cellcos will be a mix of IPX and
GRXtraffic,in which case traffic differentiation
becomes even more critical.
“Whereas it’s more difficult for a GRXto go
up to IPX, it’s much easier for an IPX connec-
tion to also support GRX,” Bell explains. “We
can create dedicated tunnels for GRX connec-
tions, and the operators that aren’t ready for
IPX per se can get an IPX connection so they
can test it, and run their GRX traffic on it in the
meantime.”
Source: Telecom Asia/TelecomsEMEA
Figure 1
Has your company connected to any IPX networks?
0706
services yet, answers vary depending on lo-
cal market needs. For example, Colin Stone,
wholesale and interconnect manager for New
Zealand’s Two Degrees Mobile – says voice
isn’t of much interest because his company is
primarily a mobile broadband access provider.
“We run a very small voice trading busi-
ness, and moving that to an IPX takes away
that arbitrage opportunity because of the
direct connectivity you get,” he explains. “So
we’ll be looking at moving our GRX, LTE roam-
ing,SMS,MMS and maybe voice.”
Market confusion
For the operators that haven’t yet con-
nected to IPX, we asked them when they plan
to do so. The most common response was
“one to three years” (48.6%), with another
15% planning to wait even longer (four to five
years). A little over 12% said they will connect
to IPXthis year.Almost a quarter said“never”.
Interestingly, our follow-up interviews
shed quite a bit of light on the reasons that
operators are holding back on IPX. For a start,
many are still in the evaluation stage, such as
du, based in Dubai, which tentatively plans to
integrate with IPX networks and hubs after its
DRA (Diameter routing agent) deployment,
says Saleem Al Balooshi, du’s EVP of network
development and operations. ”We are cur-
rently evaluating multiple IPXnetworks as part
of our LTE data roaming project and expect to
offer this by Q1 2014.” 
Even more telling, however, is the reason
many operators give for still being in the evalu-
ation stage – the IPX market is too cluttered
and even baffling.
“At the moment there’s utter confusion,”
admits Nathan Bell, head of marketing, port-
folio and pricing at Telstra Global. “There are
so many interpretations of what is an IPX,
because the term tends to be rather loosely
used.As a result, the experience with IPX right
now is similar to the early days of online order-
ing where you order something off the internet
and when it arrives,it’s either not the color you
expected or requires more assembly than you
thought.”
Kwok of HGC agrees. “One operator I
Figure 1.2Figure 1.1
If yes, what services have you
deployed through IPX?
If no, when do you plan to connect
through IPX?

Kwok agrees, saying that GRX providers
that upgrade to IPX platforms will find it dif-
ficult to keep up with LTE data demand com-
pared to facilities-based IPXservice providers.
The second shortcoming, he says, is the
ability to support mission critical apps that de-
mand high reliability and low latency. “I don’t
think GRX operators have the ability to control
that.”
Bell says that testing will help operators
build up the experience and awareness of IPX.
“Right now the key thing is to get operators to
start testing it, experiencing it for themselves
and showing them what they can do with it –
ideallywithoutanupfrontcommitmenttoit,so
they get comfortable with it.”
Benefits: privacy, security,
QoS
An important consideration in looking at
the state of the IPX market is what operators
think they’re getting (or will get) out of IPX.We
askedoperatorstorankthetopbenefitsbyim-
portance (i.e. most important, important, not
important).
By far the highest ranked benefit was“pri-
vate and secure network” – a point echoed by
Fatiha el Afghani, head of VoIP and IP conver-
gence for Orange’s international carrier divi-
sion,in a follow-up interview.
“IPX is not the answer to everything, but it
does address the need for quality and security
in the IP world,”she says.“IPX is the answer to
providing value-added services that operators
need.Thereisalwaysthepublicwebforpeople
who don’t care about or need security.”
A distant but strong second for “most
important” was “support for different com-
mercial models”, reflecting the fact that LTE
operators are still trying to work out their op-
timal business model for LTE-based services
beyond the usual voice/data packages.
For the“important”category,LTE roaming
was the top pick, as well as“support for differ-
ent operational models”.
What’s not important? Commercial trans-
parencyandconnectionconsolidation,though
that depends who you ask. Stone of Two De-
greessaysthattheabilitytoreachmanydiffer-
entoperatorsviaoneconnection“is important
to us, because we are a small company and
don’t want to have 200 connections – we try
to operate on four or five.”
Stone also emphasized QoS as a major
LTE isn’t just about internet connectivity. Operators are also looking at new service/
revenue opportunities enabled by that all-IP capability. So we asked respondents
about their various plans for LTE-related services.
benefit of IPX.“A key benefit we’re looking for
is one point,many services,so theoretically we
get a capacity decrease on our international,
and the QoS depending on the service can
be managed on that one point,” he says.“Also
having QoS is extremely important to us in
looking for a provider – how good are they with
working with multiple customers, skillsets in
terms of ease of deployment,and so on.”
Indeed,QoSisarecurringthemeinthefol-
low-up interviews. Telefonica Global Services
tells us that “clearly the possibility of ensuring
end-to-end quality of service in the IP connec-
tion is the main benefit,” as well as hubbing
benefits to make connections easier.
Byungki Oh, VP of business collaboration
at the Group Corporate Center for KT, names
“QoS guarantees and interconnection with
multiple operators”as his top benefits of IPX.
For Alex King, general manager for IR,
corporate messaging and premium services
at Telstra, “greater control over quality” is a
longer-term benefit, whereas “operational
cost savings is the biggest benefit we see in
the short term.”
One of the big questions for mobile op-
erators for both LTE in general and IPX in
particular is LTE roaming, as roaming is a
significant cash cow for the operator busi-
ness. We asked operators to tell us their
roadmaps for launching LTE roaming once
their LTE services are up and running.
(Note: for each of the questions our
survey asked regarding LTE roaming, close
to half of respondents told us they hadn’t
launched LTE roaming yet. So the results
in the following section should be read with
that caveat in mind.)
In terms of readiness, around a third
of respondents say they’re commercially
ready to offer LTE roaming, and can do so
at launch. Another 23% say they can launch
LTE roaming within a year of launching LTE,
while another 10% say it will take over one
year.
Telefonica Global Services tells us that
although it is carrying out a number of pilots
for LTE roaming,“it’s currently still too early
to offer this type of roaming”. Telefonica
expects its first LTE roaming commercial
agreements to be up and running at the end
LTE roaming
NitipongBoon-long,VPandheadofthein-
ternational business department atThai cellco
DTAC, listed “ease of manage, cost improve-
mentandguaranteedroamingquality”.Healso
noted that there could also be real benefits in
content peering,“but I don’t see any operators
viewing IPXas content exchange platform yet.”
Telenor’s Hanshus says that service level
agreements are a key driver as well. “For us,
the driver is being able to manage and control
our services on a single platform rather than
lots of interconnected platforms. We can of-
fer SLAs. We also plan to offer services on the
doorstepofbusinessunits–wecanofferthem
end-to-end SLAs.”
AlBalooshiatduputs“guaranteedend-to-
end QoS between operators”at the top of a list
of IPX benefits, as well as a single point from
which to connect to them all. Other benefits
cited by du include reduced time-to-market
for all LTE and IMS-based services, reduced
opex, secure connectivity with roaming part-
ners, flexibility in Diameter signaling routing
options, and guaranteed Diameter signaling
interoperability.
IPX connectivity grows 0908
Once you deploy LTE, when will you
offer LTE roaming?
Main benefits of IPX interconnections
Figure 3
Figure 2
What percentage of your LTE roaming destinations
are connected via Diameter hub?
Figure 4
of this year, and will see “a clear ramp up of
LTE roaming activities” in 2014.”
One key point raised in follow-up inter-
views is that operator plans for LTE roam-
ing are in some cases determined by the
business ecosystem in which they operate
– particularly for cellcos that are part of a
bigger telecoms conglomerate.
For example, Telstra has enabled LTE
roaming with just one carrier to date – its
Hong Kong subsidiary CSL – and uses the
IPX of Telstra’s international arm, Telstra
Global, for that purpose.
Then there’s Telenor Group, which owns
multiple LTE licenses covering Denmark, the
Nordics, Montenegro and soon one in Asia
Pacific (Myanmar), all of which will rely on
Telenor Global Services for LTE roaming.
“We will be a global partner for these op-
erations, and we will launch Diameter rout-
ing, and also peering, that all of Telenor will
use,” says Hanshus.
Hanshus says the carrier plans to start
offering Diameter and peering services later
this year, and will ramp availability as neces-
sary. “In the Nordics, we aim to have those

services in place by next summer.”
Meanwhile, Orange says it is still in the
trial stage of LTE roaming, but has set no
dates for when it will launch LTE roaming
services. Fatiha el Afghani says that the car-
rier is trialing LTE roaming and data signal-
ing at an international wholesale level, but
points out that LTE roaming is a complicat-
ed undertaking, starting with the fact that it
uses the new Diameter protocol.
“Operators need to adapt their equip-
ment at the interconnection level to be able
to support it,” she says.
The other complication is that, in the
longer term, LTE roaming has to support
more than just data connections, says Yves
Bellego, Orange’s director of European net-
works (strategy & spectrum).
“In the future, there will be voice roam-
ing and VoIP roaming. LTE roaming offer-
ings typically offer no VoIP, and use circuit-
switched fallback to handle voice roaming to
ensure voice connectivity,” Bellego says. “It
will take time to support VoLTE, but it’s a bit
premature in existing networks.”
answer: not that
much. Just over 21%
said less than half of their
roaming destinations were
connected via Diameter, and 18%
said none of them were. Only 7.5%
said they were using a Diameter hub for all
LTE roaming destinations.
Diameter hub usage
That includes KT, according to Oh. “Of
the eight operators with whom we provide
LTE roaming service, all of them are con-
nected via Diameter hub,” he says. “Diam-
eter hub is installed on the edge of KT’s
network for Diameter signal connection be-
tween operators.”
By contrast, “less than 1%” of Telstra’s
LTE roaming destinations are via Diameter
hub, says King.
The results do reflect upon the fact that
it’s still early days for LTE roaming, and that
LTE roaming itself is complicated by issues
such as coverage and fallback capabilities,
observes Kwok of HGC.
1110
LTE roaming
However, adds, Philippe Lucas, VP of
standardization and eco-system develop-
ment at Orange, it’s not essential to offer
VoLTE roaming right away, “as we have cir-
cuit switched fallback”, and in any case there
won’t be large developments for VoLTE
roaming support in any region until at least
sometime next year, when enough opera-
tors have deployed VoLTE at home.
“The home operator must have VoLTE
– it will take time for any Orange opera-
tion to deploy it,” he says. “Also, even if the
home operator has VoLTE, it doesn’t mean
the destination operator is supporting it for
roaming.”
Hanshus agrees that LTE data roam-
ing will be the main driver in the immediate
future. “VoLTE will be an add-on using the
same infrastructure, so not the main driver
for us.”
(We will cover operator views on VoLTE
more in-depth in the next section.)
We also asked operators to tell us what
percentage of their roaming destinations
are connected via a Diameter hub. The
“Some LTE networks only have
maybe 30 cell sites in the country, so
they’re not going to have LTE roaming yet,”
Kwok says.
Hanshus says Telenor Global Services
is still in the process of implementing di-
ameter hubbing. “All Telenor business units
will be connected over time, based on which
units need it most.”
Orange’s Lucas also points out that de-
ploying an all-new roaming protocol is a sig-
nificant undertaking in itself.
“SS7 has been used for 20 years, so it’s
quite a challenge to move to a completely
new protocol,” he says. “We have to ensure
that there are no issues and that security is
done right. That may delay it a bit, to ensure
the technical competence is there. Experi-
ence is building all the time. But I’m confi-
dent we’ll have something on a large scale
pretty soon.”
One of the issues LTE operators face
when setting up roaming agreements with
hubs is reach – how many destinations can
the hub connect you to? Consequently, how
many hubs would it take to get you connect-
ed to the places your users want to roam?
We asked operators how many hub pro-
viders they use to enable LTE roaming, and
we received a healthy mix of responses. The
most common response (18%) was one pri-
mary and one secondary hub, but over 11%
said they use only a primary hub, 9% said
they use two to three hubs, and almost 13%
said they use more than three.
IPX vs bilateral
Nitipong says that once DTAC acquires
an LTE license, it will look to a multiple-
hub option to establish roaming coverage
quickly. “Most likely we would just have an
amendment to existing roaming agreement
How many hub providers do you use to enable LTE roaming?
How will you run LTE roaming?
Figure 5
Figure 6
and use a few roaming hub providers to get
fast coverage.”
This being an IPX survey, of course we
asked operators to tell us their preference
for running their LTE roaming – via QoS
enabled by an IPX network, bilateral agree-
ments, or some other method? And the re-
sults suggest that IPX is not the most popu-
lar choice overall.
To be sure, over 44% of respondents
said they would run LTE roaming via an IPX
network. Oh says KT uses IPX for its LTE
roaming service. Telstra’s King says likewise
(although, as mentioned above, the com-
pany uses its own IPX run by Telstra Global).
But 28.6% said they would go with bilat-
eral agreements, and another 27% said they
would use “another network”, which puts
IPX in the minority – at least for now.
Still, cellcos that haven’t yet launched
LTE are decidedly looking at IPX seriously.
“To do outbound roaming, we will have to
look at IPX providers, and that’s on our to-
do list for later this year,” says Stone of Two
Degrees Mobile, which is planning to launch
LTE in the first half of next year.
LTE roaming

With voice being a popular service for
IPX, and with VoLTE now popping up as a
commercial offering in LTE networks, we
asked operators about their own VoLTE
plans.
Unsurprisingly, VoLTE is still in the
fledgling stage for most players. Almost
46% said they are planning to launch VoLTE,
but haven’t done so yet, and less than 4%
have actually launched VoLTE already. An-
other 4.5% say they’re just about to do so,
and 16.6% are still in the build or test phase.
Notably, almost 30% say they have no plans
at all to launch VoLTE.
The main motivators for launching LTE
are fairly evenly divided between cost effi-
ciency (46.6%) and voice quality (44.4%).
“Avoiding CS fallback” was only cited by
9% of respondents, which makes sense
when remembering that until LTE networks
achieve 100% coverage in enough markets,
VoLTE
Do you plan to launch VoLTE? What is the main driver
of VoLTE?
Figure 7 Figure 8
avoiding CS fallback is going to be next to
impossible anyway.
The follow-up interviews reveal a variety
of opinions about the need for VoLTE.
Telefonica Global Services says VoLTE’s
value lay in the “increase in quality in terms
of reduced setup times, audio quality with
the possibility of wider codecs, and the pos-
sibility of implementing voice with more ser-
vices such as video or RCS.”
Du’s Al Balooshi also emphasizes qual-
ity and efficiencies. “VoLTE will provide bet-
ter customer experience with shorter call
setup time and high-quality voice. It also
requires lower bandwidth, which will result
in savings on RF spectrum compared with
3G and 2G.” 
Nitipong of DTAC sees VoLTE as a re-
sponse to OTT voice services eating into
traditional voice revenue. So does KT’s Oh.
“The main drivers we see for VoLTE are
to provide innovative communication ser-
vices with better quality and features and
provide differentiated services against OTTs’
VoIP services,” Oh says.
However, King of Telstra isn’t so sure
about the need for VoLTE, at least for the
immediate future.“Given 3G equivalent cov-
erage and CS fallback, deployment of VoLTE
and an associated business case/model
remains questionable in the short term,” he
says.
Kwok of HGC says that he initially didn’t
see the drivers for running voice on IPX at
first, at least for operators that already have
TDM support for voice and can drop down to
3G. But he says that there is a definite case
for running VoLTE on IPX because it com-
bines high-quality voice with network QoS.
“If you really want just high-quality voice,
you can find apps that can do that already,
most of them free – Viber, WeChat, etc. But
1312
As you consider VoLTE, how will
you manage interconnects?
What is or will be your
commercial model as you
move to VoLTE?
Figure 9 Figure 10
LTE: it’s still about speed
Two years ago, many operators felt that the status of IPX would arguably depend
on the status of LTE. However, that hasn’t been entirely the case in practice, says
Fatiha el Afghani, head of VoIP and IP convergence for the international carrier
division of Orange.
“IPX is a reality today, even before LTE deployments”, she says, and points to
Orange’s multiservice IPX services as evidence. “We launched in April 2012 and
have around 130 customers. IPX helps prepare for LTE and other networks, and
ensures edge-to-edge quality of service for services like voice and GRX signaling,
and now it can do the same for LTE.”
Even so, for the purposes of this report, we took the opportunity to ask cellcos
about their LTE status to put current IPX activity in the context of all-IP mobile
broadband rollouts.
A little under half of respondents (46.4%) reported they have already launched
LTE. Another 28% plan to launch LTE sometime in the next two to three years,
though to put that in perspective, 10% intend to launch LTE before the end of this
year. Just over a quarter said they have no plans to launch LTE at all, though it’s
worth remembering that (1) some of the respondents to our survey are not cellular
operators (see our Methodology section at the end of this report) and (2) some of
those that are cellular operators don’t yet have LTE licenses from their respective
regulators.
We also asked operators what they see as the top driver for LTE adoption.
And for the most part, it’s still about the speed. Close to 60% of respondents
named “higher data speed” as the top driver. That number suggests that for all
the industry advice about focusing more on QoS and new service possibilities,
operators are still fixated primarily on LTE’s boosted data throughput – which is an
easy sell in this data-hungry age.
Still, that’s not the only thing they’re interested in. Almost a third also named
“new services” as their top driver. So, many operators do see opportunities to take
LTE beyond its obvious potential as a speed booster.
Also notable is the fact that few operators see LTE in itself as a competitive
differentiator – less than 5% named “follow or beat the competition” as a top
driver.
And why not? When everyone is moving to LTE sooner or later, the technology
itself isn’t much of a competitive advantage. Also, cellcos don’t see LTE as a way to
counter the threat of OTT players, according to our survey. If nothing else, LTE is
enabling them.
Figure 11
What is the top driver of LTE?
you’re putting VoLTE on top of IPX for highly
differentiated service quality,” he explains.
“Future LTE handsets will be encrypted for
noise cancellation, and people talk about
high-end voice with full duplex capabilities.
So I do think there’s a chance to rescue the
voice business beyond just offering VoLTE
as a service differentiator.”
We also asked operators how they plan
to manage their VoLTE interconnects. The
majority (almost 61%) plan to rely on IPX,
with the remainder using whatever inter-
connect management they already have in
place (to include legacy TDM).
We also asked operators what com-
mercial model they have in mind for VoLTE.
A slim majority (55%) plan to leverage IPX
transparency for termination rates and
transit rates, but the rest plan to stick to tra-
ditional pricing models.

RCS
Do you have plans to deploy Rich Communications Suite (RCS)?
Figure 12
What do you see as the main driver for RCS?
Figure 13
Another hot topic in the LTE services
space is Rich Communications Suite (RCS),
as industry groups like the GSM Association
lobby for adoption of RCS as a competi-
tive necessity for cellcos looking for a way
to keep up with OTT services that are oth-
erwise hurting their cash cows of voice and
SMS.
To be sure, RCS is already a commercial
reality. In Asia Pacific, KT, SK Telecom and
LG U+ launched “joyn” RCS services in De-
cember 2012. In Europe, Vodafone, Orange
and Telefonica (Movistar) all launched joyn
in Spain last year. Orange also launched
joyn in France this past June, with plans to
launch it in Orange’s remaining European
markets throughout 2013 and 2014. Tel-
efonica says Germany is next on its RCS
rollout list as we went to press. Germany
already has RCS services via Vodafone Ger-
many and Deutsche Telekom.And in the US,
MetroPCS launched joyn late last
year.
Overall, however, opera-
tors have been slow to em-
brace RCS, as our survey reflects. Less than
7% of respondents say they have launched
RCS, and while another 13% say they will
launch RCS later this year, close to a third
say they won’t launch RCS for at least an-
other year. And just over 48% say they have
no intention of launching RCS services, pe-
riod.
For those who are already running RCS
or plan to do so, half are backing the new
RCS-e version. The other half are going with
the older RCS 5.x.Also, close to 60% plan to
run hosted RCS.
Fighting off OTTs
In terms of motivations, the majority
of respondents (around 70%) see new rev-
enue streams as the main driver for adopt-
ing RCS. The other 30% see RCS as a way
to fend off OTT competition. Interestingly,
however, in our follow-up interviews, opera-
tors spent more time talking about the latter
than the former.
“We launched joyn to provide innova-
tive communication services and compete
against OTTs,” says Oh of KT. For example,
he says, “The most unique feature is inte-
gration of RCS and text messaging [SMS
and MMS] in a single UI that automatically
sends messages in an appropriate format
– RCS to RCS recipients, and SMS/MMS to
non-RCS recipients.”
Joyn also supports higher capacity file
sharing, he adds: “up to 100MB per mes-
sage, compared to 20MB from other OTT
messengers. And it provides strengthened
security based on carrier-grade network
quality of service.”
Bellego of Orange takes a macro view of
RCS’s capabilities to explain how it will help
cellcos on the OTT front. “Joyn will deliver
an enriched communication experience for
customers by bringing together the servic-
es that customers are already familiar with
– voice calls, messaging, accessing music,
photos and files and so on,” he explains.
“Initially for example, it will allow cus-
tomers to share videos,music and files while
chatting on the phone or while they are mes-
saging, either one to one or with many.”
But the longer-term vision, Bellego
adds, “is that joyn will become the core
communications platform for our IP net-
works, including LTE voice and video experi-
ence over IP. We are also opening the RCS/
joyn framework to allow developers to build
other rich services.”
That, Bellego insists, will help operators
distinguish themselves from OTT messag-
ing services that are neither interoperable
nor as multifaceted as joyn. “This will help
us protect revenues as well as engender loy-
alty among our customer base.”
Nitipong of DTAC isn’t quite as con-
vinced. “We’re looking into it, but I’m not
sure whether RCS will really help to com-
pete with OTT or not.”
Kwok of HGC/Conexus also takes a
more cautious tone, saying RCS is a tricky
proposition for operators precisely because
15
RCS
14
it offers them a chance to compete with OTT
players – and cellcos don’t exactly have a
great track record on that front.
“When a traditional mobile operator
launches an OTT service, compared to a
pure-play OTT, they normally fail, and they
fail ugly,” Kwok says. “Only the pure-play
OTT can be successful, because the mobile
operator can’t help thinking about what the
OTT service is going to do to its traditional
SMS revenue, which is dying. If I launch this
or launch that, what will its impact be on my
existing revenue?”
RCS comes with similar challenges, he
says. “It’s tough as a revenue proposition
because OTT players offer their services for
free. To ask customers to pay for RCS is dif-
ficult in that situation, but operators don’t
want to give away services for free.”
Stone of Two Degrees concurs. “It does
come up in conversation around LTE and
IPX and whether we should be looking at
more integrated RCS products and servic-
es. But it’s not high on the agenda because
when we look at it in terms of our three-year
roadmap, it’s one of those things that no one
can put a true monetary value on. So it gets
pushed further down the product roadmap
in favor of other things where revenues are…
well, not guaranteed, but they have higher
EBIT numbers associated with them.”
Stone also agrees that telcos in general
need a little more convincing that RCS will be
worth the effort to roll out. “I think it’s seen
more as a future product. Telcos historically
have been concerned about change,worried
about over-the-top and bastardization of
current revenues. It’s harder to make a dol-
lar now than it used to be, and I think there’s
a little bit of skepticism over how much new
revenue RCS can really bring versus the
movement away from current products and
services in an RCS-type environment.”
Kwok says Hutchison is interested in
RCS and testing it, but doesn’t see it as an

exclusive alternative to the option of part-
nering with OTT players. “We also have ini-
tiatives to talk with the big OTT players and
try to cooperate with them instead of relying
solely on a mobile carrier launch of this kind
of VAS.”
Telenor’s Hanshus says, “As a carrier
we will look into RCS. We will closely moni-
tor operator demand, but have no specific
plans beyond offering connectivity where
needed.”
He adds that support for RCS will
of course be market-driven. “It could all
change tomorrow.”
Looking toward video
There’s also interest in using RCS for
video services, at least from 54% of the op-
erators we asked. As for what kind of video
they’re interested in, it’s a fairly broad mix.
Premium video content was the most popu-
lar single category (30%), but there was
also support for video messaging (27%),
video broadcast (23%) and distribution
(20%).
Oh says that KT’s joyn service already
supports video sharing during voice calls, as
well as HD-voice/HD-video call integration.
Some operators aren’t waiting for RCS
to launch video-based services. Du – which
has not yet launched RCS but plans to do so
as part of its IMS RFP,possibly later this year
– already offers video calls for mobile users,
and several video conferencing solutions for
enterprise customers, says Al Baloosh.
Kwok says that high-definition vide-
oconferencing (HDVC) is on his IPX service
roadmap, but isn’t putting a lot of hope in
apps like video telephony. “Even with 3G,
the capability and capacity was there for
video calls, but for whatever reason people
didn’t want the other person to see them on
mobile.”
However, he adds, “I do have the hope
that video content providers will give me
more traffic and business.”
For which services have you or
would you introduce QoS on the RAN?
Figure 15QoS on the RAN
Finally, we also asked operators to give us their thoughts on
launching services with QoS on their radio access network (RAN).
Currently, few have actually done so (only 17%), and while 36% say
they plan to do so “soon”, 47% say they have no plans at all.
Fatiha el Afghani of Orange says that cellcos “have new opportu-
nities regarding radio, and minimizing the flaws, but nothing is really
defined. LTE is new, so everyone has to develop expertise together.”
Kwok at HGC agrees. “We haven’t seen any big discussions sur-
rounding that. It’s not very mature yet.”
Bellego of Orange points out that QoS in the RAN is just one
piece of a more complex QoS puzzle. “You need to have QoS on the
service part, which can then be extended to other services, and you
must also have it at the interconnection point level – from access to
core to interconnection/IPX with other operators.”
As for what services operators are prioritizing on the RAN, voice
and video are at the top of the list (at 70% and 60%, respectively).
HD voice also ranks fairly high at 54.5%.
“At the moment, we’re focused on services that are intolerant to
time delay such as voice and video,” says King of Telstra.
Lucas of Orange says that the focus for QoS with LTE should
start with real-time services, VoLTE and data. “Then you go deeper,
for example video for interpersonal communications, which is an ex-
tension of voice, video for streaming and so on.”
Gaming, interestingly, rates pretty low in terms of QoS at the mo-
ment (18%). While a good gaming experience does depend on low
latency and QoS, not all games come with that requirement, whereas
both voice and streaming video generally need acceptable QoS in
any situation.
Another question we asked is whether operators would be inter-
ested in leasing that QoS RAN capability out to third parties, i.e. OTT
players. The response was a pretty firm “no” from well over 80% of
respondents.
Do you have plans to offer video services beyond RCS?
If yes, indicate those you’re most interested in:
Figure 14
Figure 14.1
1716 RCS

© 2013 Questex Media Group LLC
All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical,
including photocopy, recording, or any information storage or retrieval system, without permission in writing from the publisher.
Sponsored by
Contributors:
John C. Tanner, Michael Caroll, Joseph Waring
Engage with SAP:
sapmobileservices@sap.com
twitter: @SAPMobileSrvcs
Our IPX survey collected data via an online survey open to telcos
across the world, as well as follow-up interviews with operator ex-
ecutives.
The 170 respondents to our survey were employed in a wide
spectrum of telecoms sectors, including wireless (26%), integrated
(22.4%), wholesale (17.6%), wire-line (12%) and “other” (the re-
mainder).
Similarly, respondents came in a variety of sizes, from 1-10 mil-
lion subscribers (20.6%) and 10-50 million (18%) to as small as less
than a million subscribers (also 18%), with almost 8% sporting over
100 million subscribers.
By region, 41% of those surveyed are based in Asia Pacific, 34%
in the Americas, 20% in Europe and 5% in the Middle East & Africa.
18
Methodology
Acknowledgments
Fatiha el Afghani, head of VoIP and IP convergence for international carrier division, Orange, Paris
Saleem Al Balooshi, EVP of network development and operations, du
Nathan Bell, head of marketing, portfolio and pricing, Telstra Global
Yves Bellego, director of European networks (strategy & spectrum), Orange, Paris
Nitipong Boon-long, VP and head of the international business department, DTAC
Kjetil Hanshus, VP of group relations, Telenor Global Services
Alex King, general manager for IR, corporate messaging and premium services, Telstra
Andrew Kwok, president of international and carrier business, Hutchison Global Communications, and
chairman of Conexus Mobile Alliance
Philippe Lucas, VP of standardization and eco-system development, Orange, Paris
Byungki Oh, VP of business collaboration at Group Corporate Center, KT
Colin Stone, wholesale and interconnect manager, Two Degrees Mobile
Telefonica Global Services, Madrid
Future outlook
As LTE networks spread and demand for high-speed data ser-
vices continues to expand rapidly, IPX deployments have accelerat-
ed. The IPX market has evolved significantly over the last two years,
which is reflected in our survey that shows a majority of respondents
(56%) are now connected to an IPX network compared to only 30%
two years ago.
We also found a higher level of clarity among operators about
the perceived benefits of moving to IPX. Top of the list is a private
managed and secure network, followed by support for different
commercial models, support for LTE roaming as well as lower costs.
Most operators have developed specific requirements and expecta-
tions for IPX.
But as the markets and network deployments continue to evolve,
so have the definition and complexity of the role that IPX plays.There
are different points of view on what it is to be “IPX-ready” vs having a
true IPX connection. Besides differences in terminology, some telcos
are still in the evaluation stage because they feel the IPX market is
cluttered and are waiting for consolidation and more clarity.
Despite these obstacles, the industry is definitely leaning toward
one connection for multiple (if not all) services to both simplify inter-
connectivity and reduce costs. Voice of course is by far the dominant
service running through IPX, with 80% of those that have connected
to an IPX network running voice. But a wide range of other services
is now also being connected via IPX, including SMS, video and Diam-
eter signaling.
The IP nature of LTE means that IPX will pretty much be required
for LTE roaming and interconnect (almost half of those surveyed
said they will run LTE roaming over an IPX network). And although
just 19% of operators currently connect all their roaming destina-
tions via Diameter hub, that is likely to increase sharply as many in
the industry say Diameter is necessary to quickly and cost-effective-
ly scale and rebuild connections with roaming partners.
How each service is deployed over IPX varies and is still open for
discussion. But the medium-term outlook is indeed bright, with half
of those that haven’t yet connected to an IPX network planning to
make the move over the next one to three years. That growth will be
driven by the 53% of telcos that have yet to deploy LTE as well as the
46% of operators that are planning but haven’t launched VoLTE.

Navigating Complexity - The Quest for True IPX

More Related Content

What's hot

Viewers also liked

Similar to Navigating Complexity - The Quest for True IPX

Navigating Complexity - The Quest for True IPX