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Summary

On September 10, 2018, Huawei held its fifth Ultra-Broadband Forum (UBBF) conference, covering four key topics: premium broadband, cloud network synergy, metro network architecture, and optical networking 2.0. The premium broadband track featured keynote speakers from some of the biggest and most influential carriers in Europe and Asia. The key message from these sessions was that broadband speed remains an important area for investment, but investing in speed alone isn't enough. To maximize the customer experience, operators must offer high-speed broadband plus efficient, high-quality services.

Broadband focus shifts away from raw speed

Given that this was the Ultra-Broadband Forum, how to efficiently deliver ultra-high-speed services using a combination of access technologies (especially FTTB and Gfast) was high on the agenda. Some of the speeds discussed at UBBF 2018 were eyewatering, with companies such as Hong Kong Telecom (HKT) already delivering 10G down to consumers' homes. However, some operators appear to be taking a more cautious approach. Swisscom, for example, discussed its strategic roadmap to deliver "service bandwidth" (i.e. only the bandwidths consumers need to receive the services they desire with the quality they expect). Even by 2021, Swisscom estimates that 100Mbps will suffice for many Swiss households – a long way from 10Gbps.

However, unlike in broadband conferences of old, speed was by no means the main topic of conversation, with a bigger focus placed on quality of experience (QoE). Gavin Young, head of the Fixed Access Centre of Excellence at Vodafone Group, summed up the importance of QoE when he stated: "Our job is not to just make a network faster, but to make it invisible."

In other words, the network should affect the customer's experience as little as possible. This means that on top of providing a high bandwidth, the network must be very low latency and with zero packet loss. Of course, this applies not just to the core network, but to home Wi-Fi as well, and "smart Wi-Fi" was certainly one of the buzzwords at UBBF 2018, with numerous service providers noting the importance of investing in this part of the network. The future is not dumb pipes, but very intelligent and dynamic ones.

Efficiency was also a key theme, with the need – as highlighted by Ryan Ding, president of Huawei's Carrier Business Group – to decouple capex from traffic growth, and opex from network scale. Technology and techniques such as network automation, and AI data analytics to remove complexity and simplify operations, were cited by many of the attending operators as helping them reduce deployment and O&M costs.

A topic that was largely missing, however, was monetization of the premium broadband experience – especially in the consumer market. To some extent, this is understandable given that UBBF is a technology-focused conference. However, with broadband subscription and ARPU growth slowing in many regions, the absence of any real discussion (other than a brief presentation from HKT on smart home and consumer IoT) around how premium broadband could help monetize new services in future was notable. Gabriela Styf Sjömans, CTO and acting COO of Telia Group, stated that in her view, "most [future] opportunities will come from the enterprise." This suggests that although some telcos are not exactly giving up on the consumer market (which Ovum believes will remain an essential part of their business), they are certainly looking more toward B2B for future growth.

Appendix

Further reading

Consumer TMT Revenue Context Model, 2017–22, CES006-000025 (May 2018)

Developing Business Strategies for a Smart Wi-Fi Gateway, CES006-000008 (February 2018)

Broadband Pricing Interactive Tracker: 2018, CES005-000017 (August 2018)

Consumer Broadband Subscription and Revenue Forecast: 2017–22, CES005-000008 (March 2018)

The Road to 2022: Key Consumer and Entertainment Trends, CES003-000266 (September 2018)

Author

Michael Philpott, Senior Practice Leader, Consumer Services

michael.philpott@ovum.com

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