Smart Expansion of LTE at 1800/2600 MHz in Hong Kong

At the MWC 2013 LTE Forum, Christian Daigneault, CTO of CSL, talked about CSL’s LTE deployment. In November 2010, CSL launched the world's first LTE/DC-HSPA+ network in partnership with ZTE.

It’s a pleasure for me to be here to introduce CSL and the experience that we had with LTE over the past two years. Back in 2010, we were the first company to launch a dual band LTE network in Asia.

CSL: Hong Kong’s Mobile Broadband Leader

CSL was established in 1983 and is owned by Telstra Australia. CSL has been leading on the technology front not only in Hong Kong but in the world.  Some recent technology milestones are: CSL launched the first All IP HSPA 21 Mbps network in Asia in early 2009. CSL LTE network was launched in 2010, and offered commercially to the mass market in August 2011. In July 2012, we signed the world’s first LTE roaming agreement with SK Telecom and we have signed another LTE roaming agreement with Telstra as well.

Why LTE so Early?       

You could ask why we were so early to launch LTE in Hong Kong. The population density and high GDP means that smartphone penetration is very high. Typically, in Mongkok and Causeway Bay, everybody owns one or two mobile devices. Mobile penetration is more than 200%. Hong Kong is the world’s fastest broadband service for both fixed and mobile. Therefore, customers in Hong Kong are used to the best service, and they expect the same level of service for their mobile devices as they experience with their fixed network.

Several studies have confirmed that Hong Kong has the world’s fastest mobile and fixed broadband. One that I often refer to is Ookla’s Speedtest.net, a popular test for all smartphone applications and fixed internet that shows Hong Kong as the fastest. Rankings from Akamai State of the Internet and ITU reports also show that Hong Kong is number one. Hong Kong is even ahead of other “very fast” Asian countries such as Korea, Japan, and Singapore.

There is an application called OpenSignal that is available for Android phones and will come to iPhone very soon. Millions of people have already downloaded the application to test speed; this is crowd-sourcing. In terms of LTE speed, Hong Kong is number two in the world, just behind Sweden. The reason that Sweden is faster is likely to be the wider bandwidth. In Hong Kong, we are using 15 MHz at 2600 MHz and 10 MHz at 1800 MHz. In Sweden, there are many markets with 20 MHz. So the bandwidth available could make the difference.  

The Mobile Data Explosion

In our two years of experience with LTE, you can see the growth in traffic. Over the past six to eight months, the LTE growth has been tremendous. Before that time, we mainly sold dongles and a few handsets. Popular devices from Apple, Samsung, HTC and Sony devices have entered the market, and so many other new devices are now available. Everything we sell is LTE; we don’t promote 3G anymore so LTE traffic is picking up very fast. Now we carry 25 percent of the traffic on LTE, and we predict that by the end of the year 2013, the volume of LTE traffic will be equivalent to that of 3G traffic. From that point, LTE will be dominant in Hong Kong. 

There was 200% traffic growth in Hong Kong last year. We are seeing this is slowing down though, mostly because the driver of growth over the past few years has been the conversion to smartphones. 70% of our customers have now converted to smartphones, and once everyone has converted, growth slows.

2+ Years of 4G LTE Maturity

Over the past two years, we have learned a lot. Many features have improved, and we are now improving customer experience, handover reliability and “stickiness” to 4G so that users do not return to 3G too often. 

There were some important milestones achieved. In November 2010, we launched the HD-Voice at the same time as we launched LTE, bringing a much better voice quality through 3G fallback. In April 2012, we launched our first smartphone. Just last week, we teamed up with ZTE to demonstrate VoLTE and e-SRVCC using HD-Voice. We are doing that in our lab using our model network. In the next few months, we plan to bring that to the live network in a larger scale proof of concept.

Innovative 4G LTE Plans

It took some time, but we now have a variety of very good LTE devices. LTE is not all about technology; it is also about our market offers. We want to aggressively move our customers to LTE so they can enjoy the enhanced experience but also to offload the 3G layer. We have not charged a premium to move customers to LTE though. We have several innovative offers that we introduced to the market. We have various offers for our two brands (1010, one2free, high-end, mass-market-end)  as well as a multi-user and multi-device plan. The wireless penetration is more than 200% in Hong Kong, therefore many people own several devices; so we combine all the SIMs together into one volume plan so that users can share the data with friends and family. With multi-device, a single person can have several SIMs. These plans are all based on the volume of data used. In Hong Kong, we still have unlimited data plans for a single SIM but we have gradually moved to volume-based pricing over the past two years. Most of our customers now prefer volume-based plans to unlimited plans and we plan to remove all unlimited plans soon.

World’s First Roaming Pacts

We introduced the first LTE roaming agreement with SK Telecom in the summer of 2012. Earlier this year, we launched 4G roaming with Telstra. There are some challenges because it is a new roaming protocol using IPX and Diameter. We have gone through the hurdle successfully, and we are now in discussions with several operators across the world to introduce LTE roaming.

LTE Performance Today

About 20 to 25 percent of traffic is now LTE. Early adopters (I don’t think this is representative of long-term users) consume almost double the traffic as those on 3G. At the very beginning, we had many dongles, which typically consume more traffic. We initially introduced the iPhone 5 on 3G and after a few weeks enabled it over to LTE. We found that a user consumes about 30% more traffic on the same device when it is moved to LTE, just because of the technology shift and faster speed of LTE.

We have also learnt that circuit switched fallback (CSFB) is very good, and it is transparent to users. In typical situation, it introduces about one to two seconds additional set-up time, but customers have not been complaining about this. This is the least of their concern I would say. Everyone is concerned about the data throughput for internet pages, and they are also concerned about not getting any dropped calls. So the call set-up time has not really had a negative impact, and CSFB is very acceptable. The average speed experienced by the customer now is about 15 Mbps in typical situations, which is 5 Mbps faster than 3G average.

LTE Network Expansion

We started two years ago with a minimum deployment that was leveraging the 3G DC-HSPA+ network. Our LTE 2600 MHz coverage was not very dense initially, having introduced LTE for every four sites. In the last year, we have expanded with LTE 1800 MHz at all sites. 1800 MHz is the coverage layer, and on top of that, we will also add 2600 MHz to every site in the summer of 2013. So we have 2 × 15 MHz at 2600 MHz and 2 × 10 MHz at 1800 MHz overlaid. We have tremendous LTE capacity already, and we target to fully re-farm our 1800 MHz spectrum in 2014 to have a full 2 × 20 MHz, which will give 70 MHz of LTE spectrum. We are in a very good position to sustain capacity for the next few years. This is why we focus very much on LTE. We think with this additional bandwidth, we can guarantee much better customer experience and throughput.

ZTE’s New SDR Solution

We have leveraged ZTE’s software-defined radio to very quickly deploy LTE at 1800/2600 MHz at all of our sites. We were the first user of ZTE’s dual band SDR, so we were certainly the motivation for them to develop it. Access to LTE in the 1800 and 2600 MHz is very common for many operators, so I figured that there would be demand to incentivate vendors such as ZTE to develop. The new RRU 8884 is four radios in one package. It supports 1800/2600 MHz, MIMO, 2G and LTE in the same footprint. It was very important for cities like Hong Kong. We have 900 MHz, 1800 MHz, 2100 MHz and 2600 MHz bands. So you can imagine the antenna sites: they are mostly rooftops loaded with these types of RRU boxes. A very small footprint was key to deploy two frequency bands at the same time.

Fostering Innovation with ZTE

There are a few innovations that we are working on and that are critical to meeting our future capacity requirement. We have signed a joint innovation agreement with ZTE in 2012, and I think that Hong Kong is a great real life lab for ZTE. Hong Kong is complex environment in terms of customer demand, density of traffic and challenging radio environment with water, mountains, and high buildings; if you can design something to work there, it will very likely work anywhere in the world. Right now we are experimenting and developing VoLTE together with ZTE. We are preparing the network, and we believe that VoLTE is mostly needed in our case to meet the increased capacity requirement that will come from offloading 3G traffic onto the 4G network. It also allows us to re-farm the 3G spectrum to LTE over the next few years.

We are also working with ZTE on a radio optimization tool called Netmax. It is a very important tool for our future because optimizing a multiband, multilayer network is becoming unmanageable with current tools. Other innovations include small cells, carrier aggregation, active antennas, and E-MBMS. We are ready for carrier aggregation in terms of having the radio at 1800/2600 MHz already installed, only a software upgrade will be required. We are working on this. For sure, we need to have devices that support all frequency bands; we’d like to encourage vendors to develop carrier aggregation at 1800/2600 MHz with full 20 MHz bandwidth. Especially in Asia and Europe, there will be large demand for these bands since several LTE networks have been deployed at 1800/2600 MHz.  

New multibeam antenna technology also needs to be developed, and it’s critical in a high-density city like Hong Kong. We need to build several layers of coverage, from the top of buildings down to the street. We need antenna beamwidth of 5 to 10 degree dedicated to different buildings, in the horizontal plane but also in the vertical plane. Antennas are key to increased capacity in the future.

I also see some opportunity for E-MBMS. In some locations in Hong Kong like our MTR, customers are watching the same content at the same time and I think that MBMS could provide substantial capacity gain.

Those are the projects we are working on currently in our joint innovation center with ZTE.      

Managing Customer Experience End-to-End

I’d like to say it’s not all about building an LTE network. We are also focused on end-to-end customer experience and how to define and monitor this experience. Like many other operators, we are investing in new tools to do this; but we are doing it at the customer level. Voice service is very traditional, and we have been managing the experience with the same tools and processes for many years. For data experience, new tools are required. With our traditional tools, we may see KPI at the BTS level looks good, that the average delivered speed is good and everything looks all right, but the user may not be having a good experience at all. We are now looking at KPIs from the customer angle, for each customer. It is not just something we are talking about; we are doing it on our network now. This is where we can start differentiating with better customer experience management; since everyone in Hong Kong has deployed LTE, everyone is equal in terms of technology. However, there is a big difference between how operators can optimize the customer experience and handle each customer issue with wireless broadband internet.   

In Closing

In closing, I would like to summarize in three points:

• The network experience is the main driver of customer satisfaction. Customer experience is not only about speed; it is not 100 Mbps or 1 Gbps. It’s being able to deliver perhaps 1 Mbps or 2 Mbps necessary for HD video on smartphone anytime, everywhere, with no buffering. We have now implemented the net promoter system (NPS) and any network problem is immediately reflected in the customer feedback. If we have capacity congestion in the network, we will immediately see a difference in our NPS. Everyone in our organization realizes that network experience is a main driver of customer satisfaction.
• Expanding capacity with LTE 1800/2600 MHz is a smart way to enhance customer experience. We were fortunate to have very good spectrum position, and we leverage it using the right technology for more cost efficient deployment.
• We are now at the turning point in investing in 4G expansion over 3G. All our customer growth is in 4G while 3G traffic remains stable.  Most of our investment is going into LTE because it is the future.