Virtualized MVNO solution of new concept for supporting entering the MVNO market

Transcription

1 Virtualized MVNO solution of new concept for supporting entering the MVNO market Realizing improvement of customer satisfaction by providing diversified services

2 INDEX INDEX 2 Introduction 3 The growing MVNO market 3 The four challenges faced by new MVNO businesses entering the market 4 1. Reducing investment risks 4 2. Reducing operating costs 4 3. Providing stable services 4 4. Distinguishing your company with diversified services 4 NEC s virtualized MVNO solution 5 1. The virtualized MVNO solution structure 5 2. The key technologies for NFV 6 Methods for solving the issues using NEC s MVNO solution 7 1. Reducing investment risks 7 2. Reducing operating costs 7 3. Providing stable services 7 4. Distinguishing your company with diversified services 8 The reason why NEC is chosen worldwide The leading company in NFV/SDN Unrivaled excellence as an SIer Contribution to the growth of the MVNO market 10 Summary 10 2

3 Introduction In recent years, MVNO has been receiving attention worldwide. The market is expanding annually, prompted by the sudden rise of MVNO usage by smartphone users wanting to reduce their communication costs. In response to this trend, the number of businesses entering the market is growing substantially as well. With increasing numbers of businesses entering the MVNO market, successful entry into the market will depend on the types of services you can provide, what the price plans you set and how many attractive services you release. In this highly-advanced technological race, the only way businesses will be able to implement these services and plans is through the practical application of a genuine MVNO solution. With regards to MVNO businesses, there are two types of switches: layer 2 connections and layer 3 connections. Due to the high flexibility of designing services provided by layer 2 connections, it is much easier for businesses to showcase their uniqueness or identity. On the other hand, however, a great deal of investment and skill is required to implement and operate layer 2 connections. As a result, businesses considering the use of implementing layer 2 connection services are faced with several pressing questions. For starters, many are unsure if they will be able to recover the cost of their initial investments, let alone meet the price plans and services provided by their competitors. And finally, they are not sure whether they will be able to overcome the technical hurdles required to operate this type of communications system. In this white paper, we will examine four of the major issues that companies seeking to enter and expand their businesses in the MVNO market are going to face. We will also introduce the method of how to tackle these issues using NEC s virtualized MVNO solution. The growing MVNO market The separation, division and privatization of public communications made enormous advances following the trend in global privatization of these public services in the 1980s. As well, the opening up of MVNO services to new businesses has further laid the groundwork for a highly competitive market through the liberalization of communication rates. This so-called liberalization of communication has in turn led to technological innovations in the industry that have spawned the rise of numerous MVNO technologies worldwide. Needless to say, communication costs have been decreasing significantly ever since. These decreases in costs have led to the growth of numerous businesses and millions of new subscribers in the MVNO market, and this trend shows no signs of stopping. On the other hand, however, the demand for even more diversified services will only escalate in the future. As is well known, with the popularization of smartphones, services like mail and browsing, SNS, online storage, music and videos have become standard, commonplace services in recent years. The M2M (Machine to Machine) market, which allows for autonomous information exchange between devices without human intervention, is also growing rapidly. Unlike voice-based services, M2M provides optimal services to suit the diversified and unique needs of each individual company. However, while the theory may sound simple, the actual running and maintenance of this technology is quite complex. An MVNO with network SIer capabilities will be required. In order to realize MVNO s full potential, businesses must be able to provide outstanding services that were previously impossible with MNO alone. Nevertheless, if MVNO is used to its fullest, the prospects for growth are limitless. 3

4 The four challenges faced by new MVNO businesses entering the market Without a doubt, new businesses entering the MVNO market will face many hurdles. The following introduces the solutions corresponding to the four main issues. 1. Reducing investment risks Dedicated carrier grade appliances are not only expensive but highly complex in structure. As a result, new challengers in the MVNO business will face large initial investments as well as equally high risks. Most companies would find it ideal to be able to start with an investment sum proportional to the scale of their company Reducing operating costs It is simple mathematics, but in order for businesses to make a profit, daily operating costs must be kept to the absolute minimum. Operating costs include items like building and electrical fees, not to mention the daily wages paid for maintenance workers. Building a structure beyond a company's capabilities from the start, without the technical manpower required to operate the system, will no doubt lead to numerous maintenance complications. Any business most companies would find it ideal to only have to pay for the actual operating and maintenance costs Providing stable services In this respect, a team with a certain amount of knowledge and expertise is going to be required. Dedicated equipment is expensive. However, inexpensive equipment is unreliable and unstable, and most newcomers to this business do not possess the qualified personnel and end up facing various operational and technical difficulties. Most companies would find it ideal to not require any specialized operational skills in this new field Distinguishing your company with diversified services Diverse and creative services are a must, unless you want to be trapped in a price-war with the competition. Again, M2M is the key for companies desiring a head-start to the future here. For when it comes to providing cutting-edge services, a genuine MVNO solution is perhaps the only practical solution available... 4

5 NEC s virtualized MVNO solution We at NEC are confident that our virtualized MVNO solution is the key. However, before we introduce our method and approach, we would first like to provide an overview of our solution and NFV s virtualization technology. 1. The virtualized MVNO solution structure The general structure and functions of our solution are as follows: OSS/BSS vmvno-gw DPI vpcrf OCS/SPR MNO Network SRC Virtual platform CGHV COTS server The Internet * COTS : Commercial Off-The-Shelf vmvno-gw (virtualized MVNO gateway) The integrated gateway of GGSN (3G) /P-GW (LTE) forms the core component of our solution. By setting the gateway on the MVNO side, connections can be made with both the MNO network's SGSN/S-GW. As well, because of layer 2 connections, the IP addresses and networks of each company can be managed, with enhanced multi-network and security capabilities. DPI (Deep Packet Inspection) Discriminating the traffic of video transmissions and P2P on the application level can be performed. As a result, not only can each subscriber's communication and application usage be grasped in real-time, but bandwidth controls based on the subscriber s contract policy can also be controlled, resulting in a more flexible billing system. vpcrf (virtualized Policy and Charging Rules Function) This function places you in control of your own policies and billing rules. These policy controls provide the framework for all traffic controls as well as the diverse service billing charges. Because bandwidth control policies and rules can be flexibly controlled, any bandwidth scenario can be supported, including policy combinations regarding use charge amount and use time per subscriber and so on defined by an MVNO operator. OCS (Online Charging System) This function grasps communication usage in real-time. It compares the current volume with preset communication usage and sends the result to the vpcrf. Communication charges can therefore be calculated online. By using this function, businesses can provide users with flexible pricing plans such as prepaid type plans, and so on. SPR (Subscriber Profile Repository) The SPR receives service orders from customer management servers etc. and manages this information inside the vpcrf's profile information management system. By consolidating subscriber profiles (contract information, category, policy, priority, etc.), this information can then be sent to various devices such as the vpcrf. OSS/BSS (Operation Support System/Business Support System) This is a handy one-stop service system that will empower the operation and duties of MVNO businesses, by handling the providing and billing of services. The OSS provides operational support that will optimize management resources pertaining to communication services, while the BSS will make business management easier. 5

6 2. The key technologies for NFV NFV (Network Functions Virtualization) is a technology that enables the virtualization of network functions. By implementing software with network telecommunications equipment functions on the virtualization platform provided on the COTS server, it is no longer necessary to implement these functions by using dedicated equipment as was the case previously. The network equipment (routers, gateways, firewalls, load balancers and so on) for which dedicated appliances had to be used can in many cases be replaced with a COTS server. This means that NFV can handle sudden fluctuations or changes in the structure in a more flexible and virtual way. In addition, promoting the aggregation and integration of physical equipment can reduce the power consumption and management costs. The following explains the CGHV and SRC, two key technologies enabling the NFV. Future One COTS server can be equipped with various functions. vmvno-gw vpcrf Firewall,NAT, etc. * MVNO-GW and PCRF functions can be integrated on a single physical server. Virtual platform COTS server SRC CGHV vmvno-gw / vpcrf CGHV (Carrier-Grade HyperVisor) By using software to add expansion functions for carrier technologies on a kernel-based virtual machine (KVM), which is a Linux standard virtualization technology, CGHV can be introduced into virtual platforms. CGHV can suppress variations in processing time, which are a particular problem in virtualization, enabling carrier grade real-time processing and reliability. In addition, the virtual switch that applies Intel s Data Plane Development Kit (DPDK) enables the provision of virtualization and high-speed processing of the data plane in a COTS server. SRC (Service Resource Controller) SRC is a MANO (Management & Orchestration) product compliant with ETSI NFV framework. Assigning optimal virtualized resources to support the real-time capabilities and reliability of carrier grade communication services enables integrated management and orchestration of the SDN (Software Defined Network). As a result, optimal resource controls are provided to handle traffic fluctuations, machine malfunctions, user requests and support, while taking into account the detailed requirements of communications services and node types. 6

7 Methods for solving the issues using NEC s MVNO solution The following introduces the methods of how NEC s MVNO solution will handle each of the four previously mentioned issues. 1. Reducing investment risks Cost-effective because of the system integrating 3GPP and LTE Since the system is designed to integrate both GGSN (3G compatible) and P-GW (LTE compatible), the vmvno-gw is cost-effective because there is no need to implement two separate systems. Minimize your initial investment and start small Since the virtualized MVNO solution applies the NFV concept, operations can be performed on the COTS server. As a result, small businesses can start small using just one U rack, resulting in a substantial reduction of the initial investment. Operations can be managed using an affordable COTS server Dedicated devices are not only expensive, but the procurement process is equally time-consuming. However, the MVNO solution, which applies the NFV concept runs on an affordable COTS server, leading to additional reduction of costs. In addition, due to the COTS server, it can be applied to any system platform vendor and shorten the lead time. Maximize your existing facility As long as you use the standard connection interface, this system is compatible with existing facilities made by other companies. Since it is possible to connect the vmvno-gw with other companies PCRF and OCS, investments in plant and equipment can also be reduced. 2. Reducing operating costs Its compact size makes it both energy and space-efficient All applications are installed on the COTS server using NFV s virtualization technology. This compact system will lead not only to an energy-saving, space-efficient workspace, but a cost-effective one as well. Fault Restoration is automated, thereby reducing maintenance costs As a result of the virtualized environment of SRC, non-stop usage is possible using virtualized functions such as live migration and auto healing. By enabling a non-stop system with automated fault restoration, maintenance costs will also be significantly reduced. 3. Providing stable services A stable system is provided with CGHV Because of KVM-based hypervisor is used, and CGHV executes a virtualized system and can handle carrier grade demands, this system is incredibly dependable. No special skills are required to run the COTS server Because the NFV operates on an COTS server, no special skills are required to handle special equipment as was previously the case. Only the most general knowledge pertaining to operations and maintenance of the COTS server is required. Full maintenance support culminating from decades of experience and achievements NEC, which has provided mobile core products at the forefront of Japan s highly advanced mobile industry since its inception, will provide full support to MVNO businesses worldwide, from initial installation to maintenance. 7

8 4. Distinguishing your company with diversified services The following describes specifically how you can distinguish your services for two main targets (smartphone users and M2M) Target 1: Smartphone users Distinguishing factor: Offering diversified services and clear pricing plans To distinguish your services from other companies, it is essential to provide diversified services and clear pricing plans that meet the specific needs and characteristics of your smartphone users. The key here is to not just reduce prices, but to offer reasonable prices that prevent wasteful usage by your customers. Let us examine some typical use cases. Heavy user restrictions Heavy users who excessively occupy communication zones, reduce the overall network communication speed, and thereby create a negative impact for general users. By placing an upper limit on the usable communication volume during a given period, excessive traffic and occupation of communications zones of heavy users can be regulated. This results in improved stability of the overall network and better communication experience for more general users. The costs incurred by MVNO businesses to handle traffic issues caused by heavy users can also be reduced. Pricing plan Communication capacity upper limit: 5GB/month Communication speed: 1Mbps Monthly rate: $10 Communication traffic (GB) Monitor the upper limit of user communications. vpcrf New Policy Policy OCS 1Mbps (1 to 20 days) Reporting the volume of communication usage MNO Network The new policy will be applied 20 days after the upper limit has been exceeded. vmvno-gw The Internet 128 Kbps (20 to 31 days) * Configure groups consisting of multiple users Purchasing additional communication usage Users can purchase additional communication if their prepaid communication volume is running low. For example, if restrictions have been applied due to excessive network usage, the user can purchase additional communication usage to remove the restriction. This in turn will lead to even greater profits for MVNO businesses worldwide. The costs incurred by MVNO businesses to handle traffic issues caused by heavy users can also be reduced. Purchasing communications Additional Purchase Screen 500MB 1GB 3GB $ 5 $ 10 $ 25 Update the user s communication capacity. Additional 1GB purchase New Policy Monitor the upper limit of user communication. Policy vpcrf OCS Client management server (portal server) Reporting the volume of communication usage MNO Network The Internet Volume of communication usage Total communications up to and including the additionally purchased 1GB can be used. vmvno-gw 8

9 Package Services By monitoring the data traffic over applications, businesses can then offer reasonable pricing packages to suit each user. Since these packages will cater to each user s specific tastes as well, the user will feel the cost benefits of these pricing services as they are allowed the freedom to select the precise services that suit their needs. At the same time, this enables MVNO businesses to offer even more creative and diverse services for their users. For example: - Allow access to sites other than video viewing sites, which will be restricted. - Allow access only to specialized sites like schools or cram schools. - Allow access to the use of mail and SNS only and restrict other services. Pricing plan Package name: Non-video site package Monthly rate: $20 Non-video site package can be used. Restricted use of video site package Non-video site SNS Video site package vpcrf MNO Network vmvno-gw DPI Policy Update Policy User selection plan Available plans: Monthly rate: $12 User-selected sites can be used. Restricted use of non-user selected sites User selection SNS User non-selection SNS Target: M2M Distinguishing factor: providing good, cost-effective services As features of M2M, M2M consists of many terminals (and sensors) and generates very small traffic compared to that of smartphones. As stated above, since the features of M2M are quite different from those of smartphone, operators may think that M2M applied to the current mobile core network is very inefficient. On the other hand, the traffic generation period from terminals (and sensors) can be controlled by M2M. Therefore, the network bandwidth can be used efficiently. Consequently, improved, cost-effective M2M services can be provided by using MVNO to configure the M2M dedicated network. 9

10 The reason why NEC is chosen worldwide The following describes the reasons why NEC s MVNO solution is chosen by businesses worldwide. 1. The leading company in NFV/SDN Just as virtualization rocked the IT industry worldwide in the last decade, we are now approaching the next virtual revolution. This time, however, the revolution is going to take place in the networking world. NEC has always led the world through our development and commercialization of SDN/OpenFlow. Our operational experience and capabilities remain at the forefront to this day. With regards to NFV, shipment of vepc products has been started. The vmvno-gw technology mentioned in this, which also uses NFV, has been commercialized as well. Without a doubt, NEC is the leading company in the NFV/SDN field. 2. Unrivaled excellence as an SIer NEC is not only a vendor but an SIer as well. Our company, which has realized the construction of networks for countless facilities, can apply our experience and knowledge again, to provide the utmost support for the expansion of MVNO businesses. Now, with the growing need for services like M2M, which require advanced and customized services for each individual user and company, NEC s expertise will be in high demand. 3. Contribution to the growth of the MVNO market NEC will support companies planning to enter the MVNO market, developing original, unsurpassed solutions from all aspects based on the features of the MVNO market. NEC will continue to improve the solutions to contribute to market development. Summary Japan is one of the leading countries in the global mobile industry. From the advent of mobile communications to today, NEC has consistently provided high quality mobile core products. This wealth of experience and knowledge is now being put to full use through the development of MVNO products, leading to the successful commercialization of our vmvno solution, the "world's first NFV concept." NEC will continue its efforts to realize NFV/SDN, and at the same time, apply its cutting-edge technologies to provide solutions for the growth of MVNO businesses worldwide. 10

11 For more information contact: NEC Telecom Carrier Business Unit 1st Carrier Services Division The system name, product name, company name and logo in this catalog are trademarks of the company or registered trademarks. Please note that the contents of this catalog including specifications and design may change without notice. NEC Corporation, 7-1 Shiba 5-chome, Minato-ku, Tokyo As of September 2014 Cat.No. F E