re: EMC on TDMA to GSM in Latin America
>> GSM Advocated as the Choice for TDMA Operators in Latin America
Mike Davies
EMC cellular
December 12, 2001
e-searchwireless.com
Since the first GSM network in the Americas was launched in 1998, the technology has expanded rapidly both in terms of subscribers and in terms of coverage. As of September 2001, GSM accounted for 5% of the 79 million subscribers in the Americas (EMC World Cellular Database), while there are now over 15 live GSM networks in the region. It was in this context that various regional operators, suppliers and other interested parties gathered at IBC's GSM Americas 2001 conference in Rio de Janeiro, Brazil, between 4-5 December 2001 in order to discuss the current and future developments of the technology. Over 500 delegates had registered for the event, approximately half of whom were Brazilians.
The majority of the speakers could be divided into operators - who provided their experience of GSM migration or deployment, and vendors - who were promoting their particular strategies for 3G or TDMA to GSM migration. There were also several keynote speeches delivered by the GSM Association, the 3GPP and the Global Mobile Suppliers Association.
Two keys areas of discussion emerged from the two days of presentations. The first of these looked at the migration of TDMA to GSM in the region and several of the recent GSM success stories.
From TDMA to GSM
The first speaker at the conference, Nicola Gatti from TIM, illustrated TIM's GSM strategy in the Americas region. With interests in, among others, Entel PCS in Chile (the first GSM operator in the region) and Digitel in Venezuela, TIM has been a key developer of GSM in the Americas. Mr Gatti felt that GSM combines several 'winning factors' that late entrants to the market, as GSM operators in the Americas often are, need to be able to compete against the incumbent operators. These advantages included:
- The economies of scale that can be found in GSM, reducing the cost of investment
- The various VAS
- The benefits of roaming
- A clear migration path to 3G.
Mario Fumi, from Entel Bolivia, along with several other operators, echoed these sentiments. Mr Fumi suggested that in 1996, Entel Bolivia decided to deploy TDMA for its 900MHz licence in order to achieve maximum impact through rapid roll-out. However, among the problems that Entel Bolivia experienced with its TDMA deployment were the high cost of investment, the restriction of VAS and difficulties with roaming. So GSM was adopted for the 1900MHz network that was launched in Q4 2000 as it improved on all these issues and, in addition, the handsets available for GSM were more diverse. According to Mr Fumi, Entel Bolivia uses its two different technologies to position itself as an innovator within the market and, while there will be no differentiation between the networks in the short term, in the medium term the TDMA network will be focused towards prepaid subscribers while the GSM network will provide the VAS.
Telcel of Mexico had already deployed TDMA in its 1900MHz spectrum when it decided to deploy GSM. Although Telcel dominates the Mexican market with a market share of over 80%, part of its decision to migrate to GSM was in order to continue competing with the CDMA operators in terms of handset variety and services. The speaker from Telcel shared the following strategies for the immediate future of its TDMA and GSM networks:
- Consolidate the operation of GSM/GPRS services expanding coverage to the major cities
- Evaluate the alternatives for evolution of GSM between interoperability of TDMA with GSM/GPRS through GAIT, installing GSM/GPRS in the 850MHz band and installing GSM/EDGE in the 850MHz and 1900MHz bands
- Integrate the technologies and services cost-effectively.
The migration from TDMA to GSM in the case of CTE Personal in El Salvador was even more complicated as it had 'to build a GSM network within the TDMA network, sharing the frequency and infrastructure, and to allow migration without interruption in communication and keeping the same phone number'. By running the two networks in parallel through narrowed bandwidth, CTE Personal was able to migrate its customers within eight months. As illustrated by Edgar Lopez, the Marketing Manager of CTE Personal, this also required significant development of customer loyalty through campaigns to minimise churn rates during the process. Among these campaigns were an attractive prepaid offer and a series of advertisements emphasising the improved VAS. By avoiding service interruption, allowing customers to retain the same number and, where possible, exchanging TDMA handsets for equivalent GSM models, churn rates were also minimised. Mr Lopez stressed that it was important to provide a time frame for migration otherwise subscribers would delay the process.
Alcatel, the vendor responsible for CTE Personal's migration, and Nortel were also on hand to provide their motivations for promoting a TDMA to GSM migration path. In general, these matched those of the operators: GSM provides economies of scale, VAS will generate new revenue streams and GSM has a clear migration path to 3G. Hayete Gallot from Nortel also looked at the challenges facing those operators wanting to achieve a successful TDMA to GSM migration. These challenges were:
- Building a cost efficient network by maximising the synergies between the networks without disrupting the existing TDMA network
- Freeing up spectrum for the GSM network
- Ensuring roaming with the existing TDMA network
- Retaining subscribers in the process
- Reducing time to market to compete with cdma2000 1xRTT operators or 'greenfield' operators.
Focus on VAS
The second topic emphasised at GSM Americas 2001 was that of VAS services. As mentioned above, many operators feel that as a technology GSM provides a greater level and variety of VAS. Entel PCS in Chile was not only the first GSM operator in the Americas, but is also considered to be one of the leading operators in terms of VAS. Among the services it offers are purchasing drinks from vending machines or metro tickets from identified outlets using SMS. Marco de Lissicich, the CEO of Entel PCS, defined four key factors for the success of VAS. Firstly, they must be efficient and work at an acceptable rate. Handset development and some level of standardisation would assist in achieving this. Secondly, the economic factor would mean that users would expect to pay for what they used. The final two factors were that services would have to be both easy to use and gratifying for the subscribers.
Olli Rissanen from TIM Peru examined several ways in which these key factors could be met. He suggested that VAS, in the initial stage, should be kept simple, possibly with written instructions and that the users would have to be educated about the workings of VAS, making them easy to use. Marketing campaigns would be central in this education programme. Providing material that is desired by the consumer and changing it frequently would ensure that it was a gratifying experience, while billing developments would cover an operator's economic concerns. Mr Rissanen also stressed the importance of signing proper copyright agreements before entering the realm of VAS, but encouraged all operators to move quickly into some form of VAS provision in order to gain a competitive advantage.
Two further case studies were given by Digitel of Venezuela and Hola of Paraguay which concentrated on their experiences with the introduction of SMS. Both speakers from these operators indicated that their SMS capacity had been exceeded as a result of the success of the service.
The Future Of Gsm In The Americas
During 2001 GSM has made further progress into the Americas. Several networks have been launched, the most recent of these being Digicel in El Salvador which launched its GSM-900 network in November 2001. As Telcel and other operators migrate their TDMA networks and greenfield operators launch, the presence of GSM will be even greater. In addition to the above, further opportunities will be available following the upcoming spectrum auctions in Uruguay, Colombia and Ecuador. Like the rest of the world, it looks as if GSM is becoming a feature of the wireless landscape. <<
- Eric - |
