A good place to start on this topic of convergence is to link back to the piece we wrote on WiFi offload and also consider the words of Craig Cowden, the CEO of Charter, who was speaking at FierceWireless’ Next Gen Wireless Networks Summit in Dallas this week, discussing WiFi and mobile convergence. Cowden said Charter, with its Spectrum Mobile MVNO, already uses public Wi-Fi hotspots to help offload traffic from its underlying mobile virtual network operator (MVNO) service with Verizon. “75% of our existing MVNO traffic is actually offloaded onto our Wi-Fi and Wi-Fi offers.” I’m presuming he is including private, in home, WiFi offload as well as public offload in this statistic, 75% would otherwise be extremely high. Even saying that, there’s no doubt they would be benefiting from reduced wholesale access costs to Verizon via their network of public WiFi access points.
Interestingly, in addition to optimising its MVNO costs with more Wi-Fi, Cowden said, “We’re always looking at how we can optimize the cost structure of our products,” and so the company is also considering “the use of our distributed wireline assets to help with small cell placements.” This would be via the use of small cells that would tap CBRS spectrum. “We would look to place small cells on strand mount because it provides power, backhaul and right of way,” said Cowden. “But we’re not always going to have aerial strand mount. We also have to look at other form factors — rooftop and pole attachments.”
Charter have long been reported to be investigating a push into CBRS. However, this is one of the first times that Cowden has openly stated that they are investing in CBRS and have been actively testing in multiple cities. It’s a positive story for the broader industry conversations around convergence and private LTE. In particular, it highlights the perfect use case for MVNOs moving further into the radio network in a cost effective and resource efficient way versus the traditional MNO route of needing to spend big on spectrum licenses and rolling out a country wide RAN.
Interestingly, Cowden makes note of this private LTE strategy supporting better access for rural communities, which amazingly is still a huge problem in the US with around 10%, or 30-odd million people, of the population still suffering from poor access to good quality ICT services, something we noted in our post: “The Digital Divide: Is the telecoms model broken?”
For me, the convergence of access technologies will be a key driver for MVNOs in the future. Not only from a cost efficiencies perspective, by offloading in high density areas, but also by aggregating multiple access technologies, they can give customers the optimal connection wherever they are. Arguably, this is even better than what the MNOs could provide with their single network.
There is, however, an elephant in the room when it comes to this convergence piece and that is the user experience. Providing users with a seamless, uninterrupted connection experience across all these different access technologies is a nut yet to be cracked. We talk about the importance of user experience in our post here. It is increasingly obvious that user experience is now one of the primary drivers of customer life time value and as a result, also any company’s revenue growth. The bar for quality digital experiences is being set high by the Netflixes, Facebooks and Googles of this world and users are expecting this same quality of experience from their telecoms and connectivity providers. However, there remains a considerable delta between what telecoms companies are providing and what users are getting and, indeed, are expecting.
There are various factors for this delta but with specific respect to convergence, there is clear standout problem which is that the broader industry has not agreed on a standard for user hand-off between different access technologies. There are multiple standards depending on the industry i.e. WiFi or Mobile but also custom OEM variants, this has led to significant fragmentation across the landscape.
With multiple technologies coming together from different industries, all with varying and sometimes competing agendas, the challenge to create a unified and seamless user experience across all these factors is a big one. I attended a great event last week with our good friends at WiFi Now where the convergence topic was discussed in detail. User experience was the key theme that kept coming up across the three day event. In today’s digital world, users know what experience they want from their brands and they are impatient when they don’t get it. When you layer on the hyper-competitive nature of the connectivity industry we operate in, there is little room for error by service providers.