Technology and Services for the Future ofGlobal Wireless Roaming

Martin GutberletPhil Redman

December 22, 2004 ATC

1© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

Roaming for Global mobile user will become moreimportant

More international travel due to globalisationInternational travellers generate a high averagereturn per user (ARPU) for mobile operatorsInternational travellers are more likely to besenior management.International subscribers need more support forupcoming data services like wireless emailSubscriber demands are becoming more sophisticated– Same quality of service for voice and data as in home country– Same charging models and tariffs as in home country

More variety of networks and handsets generates theneed for international seamless access

2© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

Evolving wireless technology and non existing globalstandards generate enhanced demand for multimoderoaming

Multiplestandardroaming

Two-standard roaming

In-standard roaming

In-standard roaming describesexchange between differentnetworks using one mobiletechnology like GSM=> multi-mode handsets withautomatic roaming

Roaming between twostandards likeGSM and CDMA=>dual system handsets orsemi-automatic roaming

Multimode handsets arenecessary for seamless accessbetween several standards likeGSM (2G) + CDMA + W-CDMA(3G) + WiFi (802.11x)Short term: Different handsets

Com

plex

ity

3© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

WCDMAGSM EDGEGPRS

CDMAOne

CDMARev. B

CDMAEVDO

<115 Kbps <384 Kbps <2 Mbps?

<153 Kbps 384 k-2.4 Mbps

802.16e

802.20 and proprietary precursors

4G

100s Kbps?

HSDPA

>2 Mbps?

10s Mbps?

1 to 2 Mbps?

IP-optimizedbroadband

technologies

2G 2.5G 3G 3.5G

4G

Evolution of mobile technology forWANs and Metropolitan-Area Networks

CDMA1XRTT

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Mobile Wide Area Network Technology and PenetrationOctober 2004

GSM (2G)

W-CDMA (3G)

TDMA

CDMA2000

Technology Connections (000) Main regions Trend

1.139,993

11,379

84,898

127,000

Worldwide

Europe, APAC

Japan, US

US, CEE, APAC

Stable

Growing

Declining

Growing

Othersincl. ESMR, APMS, TACS

88,761 ROW Declining

Declining

PDC 58,551 APAC, Japan Declining

CDMA One 100,105 US, CEE, APAC

5© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

Even with compatible technology,differences in frequency remain.

KeyRed — CDMA-basedBlue — GSM-basedGreen — Both

Geographic Convergence:Moving Slowly Toward Worldwide Standards

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Evolving wireless data technologies resulting in a variety ofnetworks without full seamless access support

Seamless access between different network technologies is not going to befully supported due to heterogenous and increasing variety of mobilesystems.

Dual system devices and subscriber authorisation ( based on Dual ModeRemovable User Identity Module, R-UIM) will widely become available

3G voice and data roaming will become available.

Global WiFi roaming will be restricted due fragmented market of publichotspot operator and conflict of interest of operators.

Preferred roaming within defined operator networks will became easier dueto launch of feature to pre-define roaming settings on handset (Over TheAir, OTA, message).

Pre-Paid roaming for different WAN technologies is upcoming.Full transparency for services will not be fully supported

– No full language support and character settings for SMS/MMS

– No full support of supplementary voice feature like call forwarding

Upcoming wireless data networks like CDMA EV-DV without roaming.

7© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

Balance between Cost control and Quality of Serviceespecially for upcoming data roaming

illustrative

Price

Quality of Service

Costcontrol

LowbandwidthguaranteedHigh latency

no VPN

Mediumbandwidthguaranteed

Medium latencyVPN

HighbandwidthguaranteedLow latency

VPNSecurity

The balance ofcost control isdepending on theapplication aninternationaltraveller uses. Ifthe applicationrequires higherbandwidth e.g. tosynchronise withan email system ahigher datathroughput isrequired resultingin increased cost.

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Predominantly voice roaming —data roaming expensive but available mostly over GPRSGSM roaming predominant--developing CDMA capabilitiesSingle phone solution for CDMA available in limited quantities

1Q05

AWE Cingular Nextel SprintPCS T-Mobile Verizon

Single Phone

SIM Card Replacement

Phone Rental

Phone Rental/One Number

Number of Countries 103 65 95 90 146 130

Number of Phones 1 5 4 Rental 19 1

Avg. CPM $1.29-$5.29 $.79-$2.49$1.29-$3.99 $2.99 $.99-$4.99 $.99-$1.49

Activation Charges $0 $0 $0 $65 $0 $0

US International Wireless Roaming

9© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

European headquartered mobile operatorsconsolidating in a Global market

10© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

International roaming offerings of top 5players for enterprises based in Europe

Offerings

4 international roaming zones3G roaming in 7 countriesMobile VPN in more than 26 countriesOffer global contracts to enterprises

Member of starmap allianceown mobile VPN offerings for 3 countries3G roaming agreement with T-Mobile

Gartner’s view

Largest international footprintBest in class for 3G roaming

3 international roaming zones & Wifi roamingMember of freemoveown mobile VPN offerings for TMO countries

7 international roaming zonesMember of freemoveown mobile VPN offerings for France&UK

High variety of roaming zonesMember of starmap allianceOnly national contracts

Large footprint in Eastern EuropeBest in class for Wifi bundles

Attractive offerings in own networkOnly 2 supported Blackberry sets

Small own VPN coverage limitsofferings for internationalenterprises

More national than internationaloriented approach

+

+

o

-

-

11© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

Upcoming business offerings from International MobileOperators alliances headquartered in Europe

Reduced number of roaming zones (3-4 world-wide)

Offerings from MNOs for mobile virtual network offers with reduction oftariffs in the range of double-digits % based on on-net services

Offerings from mobile alliances for 4 roaming zones independent from theselected network operator in countryReduced tariffs for services in visited country if it will stay in the samenetworkExample: Two knowledge workers travelling together to France and callingeach other

Further reduction of tariffs for defined countriesFlat fee offerings for push based wireless email service (e.g.Blackberry)

Same rates for SMS and MMS services in and outside country

Upcoming seamless access services bundling GSM, 3G and Wifi

12© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

Business considerations for roaming

Where did you go?– International travellers and knowledge workers have different travel patterns

depending where they home based

Why did you go there?– Trips for pleasure are less demanding than going for a business journey for a

week

Where did you call?– Outbound call patterns are depending from visited and home country

What is your traffic profile?– Duration and # of calls

What services do you use?– Voice

– Messaging like SMS/MMS

– Data

Action item: Analyse your Global travel patterns and communicationneeds before you start renewing mobile contracts

13© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

European Roaming Consolidator: Freemove

History: Formed in 2003 as Unity Alliance03/2004 launch as Freemove11/2004 large marketing campaign started

Alliance Member: Orange (France), Telefonica Moviles (Spain), Telecom Italia (Italy), T-Mobile (Germany)

Objectives: Revenue: 10% traffic growth, ARPU increaseCost reduction: Reduction of procurement costsReduction of R&D costs

Global footprint: 170 Mil. Managed customers in Europe20 European territories, 230 Mil. Potential customers

Customer segments: Large accounts: “Multi National Customers (MNC)”

Offerings: -One face to the customer (Key client management)-Enhanced billing reporting-simplified roaming (4 roaming zones) indep. from network-easier tariffs like flat fee for wireless email /Blackberry

14© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

European Roaming Consolidator: Starmap Mobile Alliance

History: Formed in 10/2003 as StarmapRe-launch in 02/2004 as Starmap mobile alliance11/2004 marketing campaign started

Alliance Member: Amena (Spain), Eurotel (Czech Republic), o2 (Germany, UK & Ireland), One (Austria), Pannon GSM(Hungary), sonofon (denmark), sunrise (Switzerland), Telenor Mobil (Norway), Wind (Italy)

Objectives: Revenue: traffic growth, ARPU increaseCommon sourcing and technology development

Global footprint: 53 Mil. managed customers in Europe

Customer segments: Large accounts: “Multi National Customers (MNC)”

Offerings: - GPRS & MMS roaming- Xda II Pocket PC

15© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

WiFi Roaming: Improving

Poor coverage and expensive WiFi Hotspot roaming has impeded enterprise adoption

Wireless Broadband Alliance•International companies

BT Openzone (UK) China Netcom (China) Korea Telecom (Korea) Maxis (Malaysia) NTT Communications (Japan) StarHub (Singapore) Telstra (Australia) T-Mobile (US)

•18,000 hotspots, 11 countries(11,000 by T-Mobile, 5,000 in US alone)

•Roaming and preferred pricing

Hotspot Aggregators: Boingo, Joltage, TrustiveHotspot and Dial-up: Wayport, iPass, GoRemote,Fiberlink, RemotePipes, Airpath, and FatPort

16© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

Leading wireless MSPsinclude iPASS, GoRemoteand Fiberlink.

Bundle remote accesstechnologies (VPN, dial-up,broadband) and wirelessWi-Fi Hot Spot services.

To come — policy-basedmanagement software andcontrol. Routing based on:– Security– Speed– Cost

Completeness of Vision

VisionariesNiche Players

Challengers Leaders

Ability toExecute

(From ”U.S. Managed Remote-Access 1H04: Leaders, Visionaries" 3 May 2004)

iPass

FiberlinkCommunications

VirtelaComm. MegaPath

Networks

NetificeCommunications

SBCQwest

MCI

AT&TGoRomoteSprint

As of March 2004

InfonetServices

Aggregating Remote Technologies Into One Service

17© 2004 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

Recommendations

Roaming tariffs should be simpleand predictable.Limit users with internationalservice.Base your choice more on serviceand costs versus devicepreference.

Make sure both voice and data are available; check allcosts first.Strategize by region or country--do not try to centralise yet.Evaluate WiFi as an alternative to international cellulardata roaming. Use VPN-based security.

Three EnterpriseStrategies:

•Multiband Phone•In-Country Purchase

•Rental Phone