Scenario Planning on LTE mobile network Virtualization

Xue BaiSupervisor : Prof. Heikki HämmäinenInstructor : Nan Zhang

MSc. in Communications Ecosystem

Aalto University

Agenda

• Research Objectives

• Background of LTE & LTE virtualization

• Methodology

• Scenario planning

• Brainstorm(PEST model)

• Key Findings

• Conclusion

• Future work

Objectives

• The mobile networks are expensive and scarce• Network virtualization reduces the amount of infrastructure

– reduces energy usage

• What are the alternative scenarios of virtualized LTE network for next 5 years?

• Supporting strategic questions:

– What is the role of key stakeholders in LTE virtualization?– How will different scenarios influence the mobile network

virtualization in the future?

Background --- LTE(Long-Term Evolution )• A standard for wireless communication

Figure  1:  Basic LTE system architecture(Harri&Antti 2011)

Core network

Radio access network

Background --- LTE Core network virtualization

Figure  2:  3GPP compliant OpenFlow controlled gateway architecture (Jari 2013)

HSS

MME PCRF

UE E-UTRAN

OpenFlow Controlled GW

S-GWP-GW

OpenFlowController

forwarding forwarding

Operator’ sIP services

S1-MME

S1-ULTE-Uu SGi

Gx Rx

S11

S6a

1-n

Background --- LTE Access network virtualization(Air interface)

Figure 3:  Virtualized LTE eNodeB protocol stack (Yasir 2012)

Methodology ---Scenario Planning(1/2)

• To forecast the future?– Too difficult

• To envision alternative futures (= scenarios)– Not just the probable futures, but also the improbable ones– Not to forecast, but to bound the uncertainty

Methodology ---Scenario Planning(2/2)

Figure  1:  Scenario  planning process (Schoemaker 1993)

Methodology ---Brainstorm

• An individual or group process of idea generation

• To identify key trends and uncertainties

• PEST analysis – Economic / industry forces– Social forces– Technological forces– Political / regulatory forces

Importance

UncertaintyKey uncertainties

Key trends

Key findings ---Major stakeholders(value network)

Network equipment

provider

Service/content provider

End-user

Mobile virtual network operator

Mobile network provider

Key findings ---Scenario analysis(1/5)

MNO: Mobile Network OperatorCSP: Cloud Service Provider NEP: Network Equipment ProviderMVNO: Mobile Virtual Network Operator

Key uncertainties:U1: Will LTE virtualization result in intense competition in the mobile market ?U2: Will virtualization of LTE lower the costs?

High competition

Low competition

Cost reduction happend

No cost reduction

Sc.1:Regulator-driven competition

Sc.3: Cooperation between NEP and MNO

Sc.2:MNO-driven mobile market

Sc.4: Balance between CSP and NEP

Key findings ---Scenario analysis(2/5)

Sc.1:Regulator-driven competition• Regulator has the power to increase the competition.

• MNOs will be pushed to give the cloud out.

• NEPs may own the network, since they operate the network now.

• CSPs may establish their own mobile network to compete with MNOs.

• CSPs/NEPs may challenge the leadership position of MNO in the market.

• More new players will entry the market.

• Price to consumers may decrease.

High competition

Low competition

Cost reduction happend

No cost reduction

Sc.1:Regulator-driven competition

Sc.3: Cooperation between NEP and MNO

Sc.2:MNO-driven mobile market

Sc.4: Balance between CSP and NEP

Key findings ---Scenario analysis(3/5)

Sc.2: MNO-driven mobile market

• MNOs may try to replace the role of CSPs.

• CSPs may rent the network from MNOs to reduce the cost.

• NEPs may need expand to provide ICT solutions to keep their profit.

• High barrier will be set for new entrants.

• The price for consumers may not decrease significantly.

High competition

Low competition

Cost reduction happend

No cost reduction

Sc.1:Regulator-driven competition

Sc.3: Cooperation between NEP and MNO

Sc.2:MNO-driven mobile market

Sc.4: Balance between CSP and NEP

Key findings ---Scenario analysis(4/5)

Sc.3: Cooperation between NEP and MNO

• MNOs may sale the network to NEPs/MNVO to compete with CSPs.

• The price for consumers may decrease.

• High barrier will be set for new entrants.

• The level of virtualization is not high.

High competition

Low competition

Cost reduction happend

No cost reduction

Sc.1:Regulator-driven competition

Sc.3: Cooperation between NEP and MNO

Sc.2:MNO-driven mobile market

Sc.4: Balance between CSP and NEP

Key findings ---Scenario analysis(5/5)

Sc.4: Balance between CSP and NEP

• MNOs will not take the role of CSPs.

• MNOs may rent/sale the cloud services to CSPs.

• MNOs may rent/sale the network to NEPs.(No threaten to MNOs)

• The revenue of MNOs may increase because of the better performance.

• The price for consumers may not decrease.

• High barrier will be set to new entrants.

High competition

Low competition

Cost reduction happend

No cost reduction

Sc.1:Regulator-driven competition

Sc.3: Cooperation between NEP and MNO

Sc.2:MNO-driven mobile market

Sc.4: Balance between CSP and NEP

Conclusion & Future work

• The level of LTE virtualization will be determined by the cost reduction.

• LTE virtualization may change the market value network in the future.

• Scenarios are built from the perspective of LTE virtualization.

• Key uncertainties are correlated to a certain extent.

• Strategic planning can be done by any given key stakeholder in the future.

• Cost reduction can be measured in OPEX and CAPEX.

Thank you!