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Access to the Global Internet: Which Technology Will Win? For most of the world Access to the Global Internet: Which Technology Will Win? For most of the world in 5 years (aside from North America and part of Europe): Phone = Cell Phone Internet = Wireless Internet • Evolution + 3 G builds on existing networks + Huge volumes + Global spectrum – Separate network – Optimized for voice – Old technology 6/5/2000 • Revolution + + IP networks Optimized air interfaces Design for converged traffic New technology for low cost – No global spectrum or approval – No market momentum – Timing? Richard E. Howard

Industry Directions for Networking FPLMTS standards begin 1990 1992 GPRS standards begin 1994 3 Industry Directions for Networking FPLMTS standards begin 1990 1992 GPRS standards begin 1994 3 M Internet Users 1 st GPRS customers 1998 1995 Microsoft & AT&T still competing with Internet 2000 153 M Internet Users Cellular Telecom Approach – Efforts to define wireless data networking standard (General Packet Radio Service - GPRS) begin before full impact of Internet explosion is felt • Internet-Based Approach – Use Internet standards for networking and mobility with extensions to interoperate with cellular air interfaces (e. g. , GPRS, CDMA 2000) • 6/5/2000 Richard E. Howard

3 G Mobility: The “Evolutionary” Route to Wireless Data Paul Mankiewich and Rich Howard 3 G Mobility: The “Evolutionary” Route to Wireless Data Paul Mankiewich and Rich Howard Bell Labs, Lucent Technology 6/5/2000 Richard E. Howard 3

3 G Cellular Systems: The Enabler of the Global Internet First Contact With the 3 G Cellular Systems: The Enabler of the Global Internet First Contact With the Internet for Most People in the World Will be Wireless Networks become the point of access that funnels end user experience into the Internet 6/5/2000 Richard E. Howard 4

Integrated Wireless Services--The Vision GPRS/ EDGE/ TDMA Base Station Wireless Backbone and Gateways • Integrated Wireless Services--The Vision GPRS/ EDGE/ TDMA Base Station Wireless Backbone and Gateways • codec converter • bandwidth manager • store & forward • playback Multimedia & Messaging Server • integrated voice and data • video postcards • in-call image up/download UMTS/ CDMA 2000 Base Station Bluetooth IP Network Content Cable, x. DSL, V 90 10/100 -Base. T Radio Hub Location Services Wi-Fi (Wave. LAN) Wireless PAN 6/5/2000 Wireless LAN Richard E. Howard 5

Migration of Digital Cellular Systems Circuit-Switched Voice Packet-Switched Data Packet-Switched GSM Circuit-Switched Voice Packet Migration of Digital Cellular Systems Circuit-Switched Voice Packet-Switched Data Packet-Switched GSM Circuit-Switched Voice Packet Data GPRS EDGE IS-136 Circuit-Switched Voice Packet Voice & Data over EDGE IS-136+ EDGE GPRS: General Packet Radio Service (17. 6 kbps x 8) EDGE: Enhanced Data for GSM Evolution (59. 2 kbps x 8) UMTS: Universal Mobile Telecomm Systems 6/5/2000 UMTS CDMA 2000 Packet Voice & Data over UMTS (WCDMA) Richard E. Howard 6

Mobility Subscriber Projections: Analyst View 1. 3 B by 2004 5/99 Est 6/5/2000 5/99 Mobility Subscriber Projections: Analyst View 1. 3 B by 2004 5/99 Est 6/5/2000 5/99 Est EMC Richard E. Howard 7

The Voice/Multimedia Revenue Gap ($ Millions) Today’s IP Market Today’s Voice Market Data Services The Voice/Multimedia Revenue Gap ($ Millions) Today’s IP Market Today’s Voice Market Data Services 37, 092 Switched Telephony Internet Access 15, 471 Fax IP Telephony 64, 775 1, 890 IP VPN Total 462, 763 419 54, 872 Total 527, 538 W ire le Today’s IP Market Today’s Voice Market Source: International Data Corp, 1998/Level 3 6/5/2000 = 9. 4% ss is m uc h wo r se Richard E. Howard

Consumer Cocktail: Do. Co. Mo I-mode • Service offered: - Security trading (2 traders) Consumer Cocktail: Do. Co. Mo I-mode • Service offered: - Security trading (2 traders) - Banking (31 banks) - Travel - Concert tickets - News - Network game - Total of 1300 I-mode web sites • Subscriber uptake: - Service Launch February 22, 1999 - 20, 000 in March - 100, 000 in April - 90. 000 new subscribers/week in August - August 99: 1. 2 million subscribers (24 million Do. Co. Mo users) - E-mail and mobile banking most popular 6/5/2000 Richard E. Howard 9

I Mode in Japan: 6 M Subscribers in Under 1 Year (and the Rate I Mode in Japan: 6 M Subscribers in Under 1 Year (and the Rate is Increasing) ~140, 000 new subscribers/week Do. Co. Mo Website 6/1/2000 6/5/2000 Richard E. Howard 10

Wonder Swan • Hand-held Game Device • Sold 1. 4 M units in Japan Wonder Swan • Hand-held Game Device • Sold 1. 4 M units in Japan in one year • Email send and receive (SMTP) • Internet Access (mini-browser) • Remote download of mini-games 6/5/2000 Richard E. Howard 11

Wireless Data in the Japan Market Applications and Network Capability Linked to Market Segment Wireless Data in the Japan Market Applications and Network Capability Linked to Market Segment Cost of Service is “Clearly” Low (10 Yen = 8 Cents) High School Girls 10 YEN P-Mail Business Professional Value Mail Capability Speed 64 K Market Segment H. S. Girl 6/5/2000 Application 64 K Dating Connection Richard E. Howard 12

Mobility: Data vs Voice • Almost all traffic (and revenue) is voice – BUT, Mobility: Data vs Voice • Almost all traffic (and revenue) is voice – BUT, mobile data is growing much faster than voice – US is behind Europe and Japan • Japan is approaching 50% data traffic • Today systems are circuit switched and spectrally inefficient – 2 G systems => ~$600/hour for video or $60/hour for MP 3 – 3 G systems have • IP backbones • Lower cost per bit • Easy service creation What will be the services? • Who will pay the bills? • 6/5/2000 Richard E. Howard 13

Migration of Digital Cellular Systems Circuit-Switched Voice Packet-Switched Data Packet-Switched GSM Circuit-Switched Voice Packet Migration of Digital Cellular Systems Circuit-Switched Voice Packet-Switched Data Packet-Switched GSM Circuit-Switched Voice Packet Data GPRS EDGE IS-136 Circuit-Switched Voice Packet Voice & Data over EDGE IS-136+ EDGE GPRS: General Packet Radio Service (17. 6 kbps x 8) EDGE: Enhanced Data for GSM Evolution (59. 2 kbps x 8) UMTS: Universal Mobile Telecomm Systems 6/5/2000 UMTS CDMA 2000 Packet Voice & Data over UMTS (WCDMA) Richard E. Howard 14

Mobility Subscriber Projections: by Technology UMTS GSM Subscribers in Thousands 6/5/2000 Lucent WNG View Mobility Subscriber Projections: by Technology UMTS GSM Subscribers in Thousands 6/5/2000 Lucent WNG View Richard E. Howard 15

3 G Data Options 6/5/2000 Richard E. Howard 16 3 G Data Options 6/5/2000 Richard E. Howard 16

Transition to Next Generation Networks Today’s Wireless Networks Next Generation Networks Internet / Advanced Transition to Next Generation Networks Today’s Wireless Networks Next Generation Networks Internet / Advanced Services PSTN Packet Mode Servers Mobile Switches MSC High Speed Data, Multimedia, Voice over IP, etc. … … n 99% Mobile Voice Circuit Derived Feature Control, Network Management, Billing, etc Circuit Mode Servers Network Servers Voice, LS Circuit Data, etc. IP / ATM Core Network Base Stations n Wireless Control Servers PSTN Radio Clients Universal Services - Voice or Data & Wireless or Wireline n Client/Server Model - Internet Derived (IP) n The next generation architecture uses Internet based client-server platforms to enable universal services and reduce network cost structure. 6/5/2000 Richard E. Howard 17

Services Rollout 3 G Video WAP launch Visual, High Speed Web cam GPRS Intranet Services Rollout 3 G Video WAP launch Visual, High Speed Web cam GPRS Intranet Video clips TV Conference Music Mobile Office Schedule Management Work flow Management Electronic Conference File Sharing SMS 1 Q 1999 6/5/2000 m-banking m-stock trading Information email Services 4 Q 1999 Interactive TV Radio Multi-player Games Portal Link m-cash Chat Room Web access Picture clips Route planning 4 Q 2000 4 Q 2001 Richard E. Howard 18

The Devices are Awesome • Docomo • Pocketboard Motorola Star. TAC™ clip. On Organizer The Devices are Awesome • Docomo • Pocketboard Motorola Star. TAC™ clip. On Organizer Neo. Point™ 1600 smartphone Nokia 7110 phone & 9110 Communicator Samsung MP 3 Phone 6/5/2000 Ericsson R 320 WAP Phone & MC 218 Mobile Companion QUALCOMM pd. Q™ smartphone Bandai Wonder. Swan Sharp Zaurus 1 0 Richard E. Howard

Can 3 G Deliver? : UMTS Capacity Estimates • Overall about 6 x increase Can 3 G Deliver? : UMTS Capacity Estimates • Overall about 6 x increase over IS-95 for voice – 3 x comes from bandwidth--5 MHz vs 1. 25 MHz – 2 x from modulation, coherent detection, and signal processing tricks. • For user rates up to ~128 kbps (BER=~1 e-4 ) – 1. 8 Mb/sec total for all 3 sectors in 5 MHz of spectrum each way. – About 5. 4 Mb/sec/basestation total for a 15 MHz up/15 MHz down license • => ~42 users/basestation at 128 kbps • Range ~2 -3 Km => Can cover UK with about 10 -20 K basestations – Capacity for about 1% of the population at 128 kbps – Smart antennas can increase this by at least 4 X • If 10% of the population wanted 128 kbps continuous (e. g. MP 3) – ~20 -40 K basestations with 4 antennas in a terminal – Reasonable flat-rate pricing possible Courtesy Gee Rittenhouse 3/7/00 6/5/2000 Richard E. Howard 20

Will UMTS Happen? : Results of UK UMTS Spectrum Auction License A B C Will UMTS Happen? : Results of UK UMTS Spectrum Auction License A B C D E Winner TIW UMTS (UK) Limited Vodaphone Limited BT (3 G) Limited One 2 One Personal Communications Limited Orange 3 G Limited Price £ 4, 384, 700, 000 £ 5, 964, 000 £ 4, 030, 100, 000 £ 4, 003, 600, 000 £ 4, 095, 000 ~$34 B says it will! Rest of Europe by Fall 6/5/2000 Richard E. Howard 21

Backups 6/5/2000 Richard E. Howard 22 Backups 6/5/2000 Richard E. Howard 22

Multiple Access Schemes FDMA TDMA Different Carriers Different Time Slots CDMA FHSS Different “Languages” Multiple Access Schemes FDMA TDMA Different Carriers Different Time Slots CDMA FHSS Different “Languages” 6/5/2000 Orthogonal Time Slots & Carriers Richard E. Howard 23

Enhanced Data for Global Evolution (EDGE) • • Defines an evolution of GSM and Enhanced Data for Global Evolution (EDGE) • • Defines an evolution of GSM and TDMA technologies to support high bit rate circuit and packet data services Builds on GPRS (General Packet Radio Service) air interface and network with adaptive modulation and coding Uses 200 k. Hz bandwidth channels Two versions of EDGE: – EDGE Classic enables full backwards compatibility with current GSM (4/12 reuse) – EDGE Compact enables limited spectrum (< 1 MHz) deployments • Channel structure supports: – Peak throughputs up to 474 kbps – Average throughputs up to 384 kbps (up to 200 kbps for EDGE Compact with limited spectrum deployments) 6/5/2000 Richard E. Howard 24

Wireless data network Macrocell-mobile r~3 -5 km Minicell-mobile r~1 km Picocell-pedestrian r~100 m Increasing Wireless data network Macrocell-mobile r~3 -5 km Minicell-mobile r~1 km Picocell-pedestrian r~100 m Increasing data rate, decreasing cell size • • • Macrocellular data rates ~384 kbps (UMTS-FDD) Minicellular data rates ~1 Mbps (UMTS-TDD) Picocellular data rates ~1 -20 Mbps (Bluetooth, hyper. LAN) BLAST technology used in every one 6/5/2000 Richard E. Howard 25

Internet Volume Approaches Voice Projected Crossover Data=10 x. Voice 1999 2000 Worldwide voice/modem traffic Internet Volume Approaches Voice Projected Crossover Data=10 x. Voice 1999 2000 Worldwide voice/modem traffic w o h S e M e h T y! ne o M è Projected Actual ç New networks will need to be deployed as demands for data and interactive services approaches capacity of existing voice/data networks Source: Internet Society 6/5/2000 Richard E. Howard 26

Real Time Services Via GPRS & IP: Phase 2 - VOIP Starting at Terminal Real Time Services Via GPRS & IP: Phase 2 - VOIP Starting at Terminal IP Client in terminal for Voice and packet data SGSN Mob Manager GGSN 7 RE Feature Servers • Packet Voice (VOIP) starts with an IP Client in the terminal, the call model resides in feature servers 7 RE Resource on the IP network. 7 RE Signaling Gateways Servers IP/ATM Core Network Traditional Circuit voice supported by MSC Packet Gateway 5 ESS Switch Customer Care NM Servers Packet Gateway To Data and VOIP Gateways Circuit Data IWF APs Call Control Servers • Traditional Circuit voice is supported as before. PSTN ANSI-41 Backbone Network Use Today’s Wireless Voice Infrastructure and Interconnect with the Packet Core Network at a PSTN trunk level. 6/5/2000 Richard E. Howard 27

Enhanced Data for Global Evolution … (continued) • • • Handoff enabled through reselection Enhanced Data for Global Evolution … (continued) • • • Handoff enabled through reselection procedures Current work in ETSI to define Vo. IP and Real-Time services over EDGE in GSM Release 2000 Phase 1 – Standards: Release ’ 99 – Large deployments start in 2002 • Some initial deployments start in 2001 – Supports best effort packet data at speeds up to about 384 kbps • Phase 2 – Standards: Release 2000 – Large deployments start in 2003 • Some initial deployments start in 2002 – Will add Voice over IP capability 6/5/2000 Richard E. Howard 28

3 G Solution Direction • • • 6/5/2000 One Network delivering Voice and Data 3 G Solution Direction • • • 6/5/2000 One Network delivering Voice and Data services – Supporting all major 3 G Technologies to enable operators to meet global market needs – IP Centric Network Architecture for Internet derived services – Future proof platform that evolves with the IP networking industry – Working with Sun to deliver next generation services with carrier grade reliability (99. 999%) Flexible Service Creation – Provides platform for integration of mobile and internet environments – Rapid service delivery for Lucent developed and third party services – Retain value in wireless network by creating operator controlled value added interfaces • Operators want to be more than an IP pipe provider Rapid Network Deployment – Easy to install and maintain – Self Optimizing – Integrated maintenance capabilities to reduce life cycle costs Richard E. Howard 30