Going on holiday this summer? In this post, Michel van Veen, IPX business manager for SAP Mobile Services takes a look at the how Local Breakout and IPX will enable operators to meet the strategic challenges presented when customers roam.
As LTE rollouts gain pace, consumers will have access to new networks and higher data speed. While it will take time for the end-user market to catch-up with the industry’s perceptions, the industry still needs to address certain expectations around LTE.
At first glance the roaming advantages dominate the LTE experience. Local Breakout, a mechanism where roaming traffic does not traverse back to the home network and is handled by the local operator, allows for cheaper tariffs and will also bring increased localised revenue. The challenge for the network operators is to understand how and where the placement of Local Breakout can be advantageous for them.
Networks are only likely to allow Local Breakout if they can either guarantee reciprocal partnerships with other networks or have a larger network than one that simply exists in one country. Networks will need to restructure tariffs to include Local Breakout and it is likely to become a key selling point for operators. While this selling point won’t remain unique for long, it will be the operators that can react fastest with a Local Breakout proposition that stand to gain more.
SAP are a sponsor of the LTE Asia conference, taking place on the 18th-19th September 2013 at the Suntec, Singapore. Click here to download a brochure for the event.
There are still a number of challenges for operators on the use of Local Breakout, beyond working out what they can charge. Guaranteeing Quality of Service will become even more important, especially with a greater use of data and cloud services by consumers. For example, my phone backs up the photos I take with it to my Dropbox account. If I took my phone on holiday and it switched to a local network because I have Local Breakout on my contract, I would expect the holiday photos to upload to Dropbox in the same way. If I found that I had lost my phone and all my photos and they weren’t backed-up, due to a poor network, that would cause a customer service issue (to put it lightly)! It also raises the question of who is accountable: the network you were using at the time or the operator with whom you signed the contract that included Local Breakout?
Naturally network operators will be keen to avoid such scenarios. They will want to build on a solid infrastructure that will allow connectivity for Local Breakout and other services. The infrastructure change will be provided by IPX. With IPX we gain scalability and flexibility, but also a resetting of the boundaries between providers and networks within the sector. Those able to utilise a larger IPX footprint will naturally have greater opportunity to propagate services. The adoption of the new Diameter standard will be key to the success of IPX implementation and should result in high quality services becoming available throughout the industry.
Applying strategic thought to the new roaming challenges provided by Local Breakout, will be key to the success of LTE and networks’ performance in the future. Coupled with the infrastructure demands that need to be met with IPX it will be interesting to see how the networks rise to the challenge.