Emerging Technologies in Mobile and Wireless Data Network EvolutionProceedings of the Research Seminar on Telecommunications Business

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Helsinki University of Technology Publications in Telecommunications Software and Multimedia Teknillisen korkeakoulun tietoliikenneohjelmistojen ja multimedian julkaisuja

Espoo 2003 TML-C11

Emerging Technologies in Mobile and Wireless Data Network Evolution Proceedings of the Research Seminar on Telecommunications Business

Editor Sakari Luukkainen

ISBN 951-22-6622-9 ISSN 1455-9749

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Helsinki University of Technology

Telecommunications Software and Multimedia Laboratory P.O. Box 5400

FIN-02015 HUT Tel. +358-9-451 2870 Fax. +358-9-451 5253

Helsinki University of Technology

Telecommunications Software and Multimedia Laboratory Publications in Telecommunications Software and Multimedia

Teknillisen korkeakoulun tietoliikenneohjelmistojen ja multimedian julkaisuja TML-C11

Espoo, 2003

Emerging Technologies in Mobile and Wireless Data Network Evolution

Proceedings of the Research Seminar on Telecommunications Business II, spring 2003

Editor: Sakari Luukkainen (Lic.Tech.)

Keywords: mobile networks, wireless neworks, telecommunication business & investments, UWB, AdHoc, UMTS, WLAN, SDR, CDPD, EDGE, MMW, 60 GHz, MPEG-4, MVAS,

Wireless Instant Messaging, Mobile Entertainment

The articles have been written by the students of the course T-109.551 Research Seminar on

Telecommunications Business II in the spring 2003. The authors have full copyright to their articles.

Technical editing by Eino Kivisaari.

http://www.tml.hut.fi/Studies/T-109.551/2003/Proceedings.pdf ISBN: 951-22-6622-9

ISSN: 1455-9749

URN:NBN:fi-fe20031401

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Preface

Mobile and wireless technologies are now in a discontinuous phase. As cellular mobile networks evolve from enhanced GSM to next generation systems by providing faster data connections, personal area networks (PAN) and wireless local area networks (WLAN) are also gaining popularity. Several wireless technologies are emerging, the success of which is unclear due to complex market dynamics, technology development and risks related to both.

WLANs have already proved their effectiveness in the indoor business usage by extending the evolution of fixed LANs but the transition from voice to data in mobile networks has so far been slow despite the high expectations. Do we see in the outdoor data usage a complementary development of wireless and mobile technologies or does a single radio interface take a dominant role in the future like in the case of GSM?

The experiences gained so far indicate that it is very difficult to predict the demand of new technologies and related services. Nevertheless, the launch of a service or R&D project usually requires large investments which imply big risks. The development of end user behaviour is more incremental than discontinuous. That is why it seems that we need parallel incremental evolution of services during the revolu- tion of radio related technologies. Another important issue is to realize that each emerging radio interface has its own strengths and weaknesses both in economic and technical terms. It is likely that the future network environment is a heterogenic multi-radio network which provides the end user a single subscription with differ- ing service quality depending on the geographic area in question.

This publication is a collection of research reports written during the course Re- search Seminar on Telecommunications Business at Helsinki University of Tech- nology. The course is especially designed for students taking Telecommunications Management for their major but is as well suitable for all students that like to develop their techno-economic analysing skills in the telecommunications area. The aim of the Telecommunications Management major is to help the students to understand the structure and dynamics of economic life and industry with a special focus on the telecommunications by combining business and technology studies.

The course provides an opportunity to rehearse scientific writing and presentation skills. The goal of the spring 2003 seminar was to investigate the challenges service providers face when updating their network infrastructure to offer emerging mobile and wireless data services taking into consideration both business and fast developing technology requirements and possibilities. One major challenge is to move from a technology-oriented to a business/service-oriented approach.

As a result of hard work we have now a collection of interesting papers of several possible technological scenarios in the mobile and wireless data network evolution.

I want to thank all the contributors from excellent papers as well as lively discus- sions during the seminar sessions.

Sakari Luukkainen Espoo, June 5th.2003

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Positioning EDGE in the Mobile Network Evolution ... 6

UMTS and Its Market Analysis ... 16

UMTS Investment Study ... 25

CDPD Service ... 32

5 GHz WLAN ... 37

WLAN Operator Cases ... 42

Ad Hoc Networking as an Internet Access Technology ... 51

Market Strategy Evaluation of Ultra Wide Band Technology ... 57

60 GHz MMW Applications... 61

Introduction to Software Defined Radio ... 66

MPEG-4 Technology and Business Strategies... 71

Changing MVAS Environment ... 75

MMS and WIM Technology and Business ... 81

Mobile Entertainment ... 89

In this paper, we present EDGE technology along with its business opportunities. EDGE gives GSM the capacity to handle services for the third generation of mobile networks. EDGE was developed to enable the wireless transmission of large amounts of data at a higher speed than before. EDGE will allow GSM operators to use existing GSM radio bands to offer IP-based multimedia services and applications. Implementing EDGE will be relatively easy and will require relatively small changes to network hardware and software.

1 INTRODUCTION

EDGE technology gives GSM the capacity to handle services for the third generation of mobile networks. EDGE was developed to enable the wireless transmission of large amounts of data at a higher speed than before.

EDGE will allow GSM operators to use existing GSM radio bands to offer IP-based multimedia services and applications at theoretical maximum speeds of 384 kbps with a bit-rate of 48 kbps per timeslot and up to 69.2 kbps per timeslot in good radio conditions.

Implementing EDGE will be relatively easy and will require relatively small changes to network hardware and software as it uses the same TDMA (Time Division Mul- tiple Access) frame structure, logic channel and 200 kHz carrier bandwidth as today’s GSM networks, which allows existing cell plans to remain intact.

This paper focuses on firstly studying the technology behind EDGE and secondly on studying business related issues.

This paper is organized as follows. Sections 2 and 3 present cellular network evolution along with mobile service evolution towards 3G. In Section 4, EDGE technology is studied. Section 5 presents vendors EDGE strategies. In Section 6, EDGE enabled services are presented.

Section 7 shows terminal availability. In Sections 8 and 9 EDGE investment costs and revenues and EDGE investments strategies are studied. Finally in Section 10, the future role of EDGE is discussed. Concluding remarks are provided in Section 11.

2 CELLULAR NETWORK EVOLUTION Cellular radio networks are generally divided into three generations.

Analogue cellular systems, such as Nordic Mobile Tele- phone (NMT), are considered to be the first generation of cellular technologies.

The second generation is the present digital network generation which includes systems like Global System for Mobile communications (GSM), Digital Cellular System (DCS), Digital Advanced Mobile Phone System (D- AMPS), and Interim Standard –95 (IS-95). The second generation includes also enhancements to GSM: High Speed Circuit Switched Data (HSCSD), General Packet Radio Service (GPRS) and Enhanced Data rates for GSM Evolution (EDGE). These enhancements are called the generation 2G+ or 2,5.

According to International Telecommunications Union (ITU) specifications, the third generation cellular networks will offer data transmission speeds up to 2Mbps. Univer- sal Mobile Telecommunications System (UMTS) is one of the mobile communications systems being developed within the ITU framework known as International Mo- bile Telecommunications IMT-2000.

GSM

9.6kbps UMTS

2Mbps

HSCSD 57.6kbps

GPRS 115kbps

1999 2000 2001 2002 2003 EDGE 384kbps

Figure 2.1. Evolution paths of GSM towards third generation networks

The different GSM evolution paths are shown in Figure 2.1. The data rates are the maximum data rates theoreti- cally provided by different systems. In reality, maximum data rates are achieved only in very limited circumstances, if at all.

Positioning EDGE in the Mobile Network Evolution

KATJA KOIVU

TELECOMMUNICATIONS SOFTWARE AND MULTIMEDIA LABORATORY

HELSINKI UNIVERSITYOF TECHNOLOGY

P.O. BOX 5400, 02015 HUT, FINLAND KATJA.KOIVU@HUT.FI / KATJA.KOIVU@OMNITELE.FI

SAMI VESALA

COMMUNICATIONS LABORATORY

P.O. BOX 3000, 02015 HUT, FINLAND SAMI.VESALA@HUT.FI / SAMI.VESALA@OMNITELE.FI

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3 EVOLUTION OF MOBILE SERVICES Voice services are still the most important services provided by mobile communications networks. However, the earlier presented enhancements to ordinary GSM technology bring new possibilities for various data services.

At the same time, the importance of other than voice services grows rapidly.

The development of mobile data services follows the evolution path of cellular technologies. The first generation analogue cellular systems offered extremely slow and un- reliable data connections and identification methods were not well developed.

The second-generation digital cellular systems made an improvement to the data services and data rates. In addition, Subscriber Identification Module (SIM) cards in GSM phones improved security and enabled, for example, safe bank connections and using of cellular phones for money transactions.

The Short Message Service (SMS) provides guaranteed delivery of small data packets even if the phone is switched off when the message is first sent.

Now, second-generation services offer higher bit rates and packet-switched connections. The development path ad- vances towards UMTS and third generation services that offer the ground for many high-speed services. In addition, wearable computers and totally computerized homes can be a part of everyday life after a few years. Wireless Local Area Network (WLAN) products and other possible wireless network applications can have a remark- able role in parallel with advanced cellular network services.

3.1 Multimedia Message Service

The multimedia message service (MMS) has become a significant issue for mobile operators future growth strategies. MMS is expected to be the most important service for operators, content providers and service providers since MMS will provide them with a new source of revenue now and in the 3G markets.

The key to MMS is to maintain the fundamental features that have made SMS a success story, while offering consumers a more versatile and personal experience. MMS will enable consumers to send and receive multimedia messages between mobile terminals as well as between terminals and content servers. MMS messages combine image, sound and text, and even animation and video. The camera phones, which are currently available, do not pro- duce pictures, which are bigger than 100Kbytes.

Now, mobile operators have started to push MMS services seriously. At the start of 2002, only a single operator, Norway’s Telenor, had launched MMS-based picture messaging. By November 2002, over 60 operators worldwide were offering picture messaging.

One of the key factors that will determine the answer to whether or not large numbers of consumers will take pic-

ture messaging part of their lifestyle is service pricing.

MMS-compatible phones are expensive and users will only be persuaded to buy these camera phones if they can afford to use them. The widespread usage of SMS text messaging has been enabled by service pricing which is both easy to understand and fairly cheap. [1][2]

3.2 HSCSD and GPRS enabled services and data rates in practice

Today, HSCSD and GPRS connections are mainly used for accessing email, getting information from the Internet, web surfing in general, entertainment (e.g. downloading video clips, music, etc.), banking and shopping. The data rates achieved by using HSCSD and GPRS with terminals available on the market are quite similar.

The current terminals and networks do not support much over 40 kbps data rates in practice – this means slower and more unstable connections than ordinary fixed-line modems can offer.

HSCSD connections are more stable compared with GPRS connections because of the circuit-switched nature of HSCSD. Even though, it is not assured, that a HSCSD user gets all the three timeslots his terminal can carry for the downlink traffic. In many cases, circuit-switched speech is prioritized over HSCSD and GPRS traffic and thus timeslots first allocated for data are allocated for speech on the go. In the current GPRS networks only CS- 1 and CS-2 coding schemes are used. The average C/I from tested networks leads to 11,5 kbps/timeslot. There- fore in practice, the networks offer “best effort” service quality and slow connections.

Giving data users enough capacity is also a pricing issue.

Adding capacity to the network is always an extra investment. Operators in Finland have different pricing strategies and thus also their network parameters for GPRS traffic differ from each other.

4 EDGE TECHNICAL FUNDAMENTALS Enhanced Data rates for GSM Evolution (EDGE) is a major enhancement to GSM/GPRS data rates and it improves the GSM air-interface performance significantly. EDGE offers improved data rate through optimized modulation (8-PSK) and it introduces a large number of channel coding schemes along with Incremental Redundancy (IR), Link Adaptation (LA) enhancements and in the near future adaptive multirate (AMR).

The new modulation and the possibility to adapt the transmission rate to channel quality are the core of the EDGE concept. Introducing EDGE in a GSM network does not imply changes in the basic architecture. In any case, modifications of the Mobile Station (MS), Base Station (BTS) and Base Station Controller (BSC) are needed, which means, among other things, software and hardware upgrades in circuit- and packet-switched parts of the network.

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EDGE offers both circuit- and packet-switched connections depending on the platform it is implemented in. The scope of the EDGE phase 1 standard is to increase GPRS bit rate, improve GPRS link quality control (EGPRS) and to offer high circuit-switched data rate with fewer timeslots and fast power control (ESCD). The scope of the EDGE phase 2 includes supporting real-time services over EGPRS.

GSM networks have already offered advanced data services from single SMS and circuit-switched 9,6 kbps data services to 64kbps HSCSD and 160 kbps (theoretical speed) GPRS. With EDGE, the data rate offered by the original HSCSD or GPRS networks can triple. [3]

4.1 8-PSK modulation in GSM/EDGE standard EDGE is specified to reuse the channel structure, channel width, channel coding and the existing mechanisms and functionality of GSM, HSCSD and GPRS. The enhancement behind tripling the data rates is the introduction of the new modulation type.

The modulation type that is used in GSM is the Gaussian minimum shift keying (GMSK), which is a kind of phase modulation. EDGE introduces the octagonal phase shift keying (8-PSK) modulation in addition to the existing GMSK, see Figure 4.1.

(0,0,1)

(1,0,1) (d(3k),d(3k+1),d(3k+2))=

(0,0,0) (0,1,0) (0,1,1)

(1,1,1)

(1,1,0) (1,0,0)

Figure 4.1. 8-PSK signal constellation principle The number of symbols sent within a certain period of time, the symbol rate, remains the same as for GMSK but an 8-PSK signal is able to carry three bits instead of one.

The total data rate is therefore increased threefold.

An 8-PSK modulated signal is more sensitive to errors and thus the highest data rates can only be achieved with limited coverage. GMSK modulation is more efficient under very poor radio conditions and therefore EDGE coding schemes are a mixture of both GMSK and 8-PSK.

[3][4]

4.2 Enhanced general packet radio service (EGPRS) Enhanced general packet radio service (EGPRS) is build on top of GPRS.

Four different coding schemes are defined for GPRS (CS- 1 to CS-4). Each has different amounts of error-correct- ing coding that is optimized for different radio environ- ments. For EGPRS nine modulation and coding schemes

(MCS) are introduced. Classes MCS-1 – MCS-4 use the basic GSM 0.3 GMSK modulation, whereas classes MCS- 5 – MCS-9 use the new 8-PSK modulation. Table 4.1.

shows EGPRS modulation and coding schemes along with their maximum throughputs.

Table 4.1. EGPRS modulation and coding schemes

Another improvement that has been made to EGPRS standard is the ability to retransmit a packet that has not been decoded properly with a more robust coding scheme, whereas for GPRS re-segmentation is not possible. In GPRS once packets have been sent, they must be retrans- mitted using the original coding scheme even if the radio environment has changed.

4.3 Link adaptation

EGPRS uses automatic link adaptation (LA). LA is used to select the best MCS for the radio link conditions. LA uses the radio link quality measured either by the mobile station or by the base station to select the most appropri- ate modulation and coding scheme for transmission of packets. Each modulation and channel coding class is optimized for a certain range of C/I (interference) values, outside of which the data rate no longer increases together with the C/I value, but saturates. LA algorithms compare the estimated channel quality to threshold values and that leads to optimized throughput. In reality, the link adaptation may not be close to the ideal situation where the maximum data rate is (as a function of the C/I curve) achieved by switching channel coding class “on the go”. [3][4]]

4.4 Incremental redundancy

Another way to choose the optimal channel coding class is to use the incremental redundancy technique (IR). In- cremental redundancy initially uses a coding scheme with very little error protection (such as MCS-9) and without consideration for the actual radio link quality. When information is received incorrectly, additional coding is transmitted and the resent information is soft combined in the receiver with the previously received information.

IR adjusts the code rate of the transmission to true channel conditions with incremental transmissions of the re- dundant information until the decoding is successful. For the mobile stations, incremental redundancy support is

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mandatory in the standard. The information about the radio link is not necessarily to support incremental redundancy. IR gives additional 2-3dB to the radio link. [3][4]

4.5 Enhanced circuit switched data (ECSD)

Enhanced circuit switched data (ECSD) is based on the current HSCSD is GSM networks. The ECSD architecture is mainly based on HSCSD transmission and signal- ing.

ECSD does not increase the maximum 64 kbps data rate of HSCSD but it makes the network more efficient: the same data rates can be achieved with allocation of fewer timeslots and simpler MS implementation.

Circuit-switched data connections up to 64kbps are sufficient for providing various transparent and non-transparent services, e.g. interworking with audio modems and ISDN at various data rates and various video based services ranging from still image transfer to videoconferencing services.

In the future, Enhanced Adaptive Multi Rate codec (EAMR) enables the transfer of high-quality speech and music. The same restrictions apply to EAMR connections as apply to ECSD, as EAMR is also circuit-switched.

[3][5]

4.6 EDGE evolution towards GERAN Rel5

GSM/EDGE radio access network (GERAN) Rel5 includes a definition of enhancements to the GPRS radio link interface and will provide support for conversational and streaming service classes as defined for WCDMA.

With the adoption of the UMTS Iu interface and the UMTS quality of service (QoS) architecture in Rel5, GERAN and UTRAN can be efficiently integrated under a single UMTS multi-radio network. In addition, GERAN will include performance enhancements for existing services.

IP Network HLR

MSC/VLR

SGSN RNC

RNC BTS

PSTN

GGSN UTRAN

Network Subsystem

GPRS-backbone BTS

EDGE BS BSC BTS

GPRS/EDGE Radio Network

Core Network UMTS Radio Network

Figure4.2. A simplified model of the combined GSM GPRS/EDGE and UMTS network [6]

In general, the goals and impacts of GERAN Rel5 specification are to enable GERAN to the same 3G CN (core network) as UTRAN creating first steps towards efficient resource optimizations in multi-radio networks, and to enable GERAN to provide the same set of services as UTRAN, making the radio technology invisible to the end-

user, while allowing operators to efficiently manage the available spectrum. The existing GERAN radio protocols need to undergo significant modifications, and this will increase the complexity of radio interface protocols. In addition, standardization of the GERAN Rel5 should support a true multi-vendor environment and GSM/EDGE radio access should be backwards compatible, i.e. support of services for pre-Rel5 terminals must be ensured.

[3][4]

4.7 GERAN Rel5 features

In the 3^rd Generation Partnership Project (3GPP) Rel5 overall, the most significant new functionality is the Internet multimedia subsystem (IMS). From the GERAN perspective, the support for the IMS services implies introduction of the Iu interface, and definition of the header adaptation mechanism for the real-time protocol (RTP), user datagram protocol (UDP), and Internet protocol (IP) traffic. Rel5 includes also major enhancements for speech:

wideband AMR speech for enhanced speech quality, half- rate 8-PSK speech for improved speech capacity, and fast power control for speech. In addition to the abovementioned enhancements, Rel5 implies location service enhancements for Gb and Iu interfaces and inter- BSC and BSC/RNC network assisted cell change (NACC).

[3]

4.8 GERAN Rel5 system architecture

To connect to the WCDMA/GPRS core networks, GERAN will use the Iu interface, as shown in Figure 4.3.

The Iu interface connects to the circuit-switched domain (Iu-cs) and to the packet-switched domain of the core network (Iu-ps). GERAN also connects to the second-generation core network nodes by using the A and Gb interfaces. These interfaces remain intact in Rel5 to support Rel’99 terminals. Iu-ps interface is not used for Rel´99 terminals because the functional split between the radio access network and the core network differ substantially between Iu and A/Gb.

BSS

RNC

Um

GERAN

UTRAN BSC BTS BTS

GSM/WCDMA Core Network MS

MS

Iur-g A Gb

Iu

Iur-g

BSS

RNC

Um

GERAN

UTRAN BSC BTS BTS

GSM/WCDMA Core Network GSM/WCDMA Core Network MS

MS

Iur-g A Gb

Iu

Iur-g

Figure 4.3. GERAN architecture in Rel5

The radio interface Um between GERAN and the mobile station is based on the Rel99 radio interface link specifications. However, several modifications are needed on radio link protocol layers in order to provide adequate radio bearers for real-time services. These modifications

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imply to support for cell reselection for packet-switched domain, separation of user and control planes, and transparent modes in the radio link protocol layers. [3][4]

4.9 Modifications to the GSM network imposed by EDGE

The implementation of GSM EDGE requires basically only TRX change to EDGE TRXs in the GSM base stations and software updates to GSM BSC and GPRS IP- backbone. A bigger investment would most probably be the upgrade of Abis interface from 16 kbit/timeslot connection to EDGE capable 64 kbit/timeslot connection. [6]

The impact of EGPRS on the existing GSM/GPRS network is limited to the base station system due to the mi- nor differences between GPRS and EGPRS. A new trans- ceiver unit capable of handling EDGE modulation as well as new software that enables the new protocol for packets over the radio interface in both the base station and base station controller. The core network remains intact. [4]

A-bis

A-bis MSC

G n G n

GGSN

BSC AA 2G SGSN BTS

BTS

OSS

GSM/EDGE

Iu Iu

Figure 4.4. EDGE implementation [7]

In Ericsson case, EDGE is compatible with recent equipment. If an operator has an Ericsson RBS 2000 macro base station from 1995 or later, it is easy to take on EDGE.

Some additional hardware using plug-in transceivers, and new software that can be installed remotely is all that is needed for operators to start offering high-quality Mo- bile Internet services over their existing infrastructure. [8]

In Figure 4.4, the elements for EDGE implementation are shown.

4.10 EDGE radio network planning compared with GSM/GPRS planning

If we think the implementation of EDGE of the radio network planning perspective, the same principles as in the GSM/GPRS network planning apply. As in GPRS, EDGE performance is dependent on the achievable C/I (and RXlev) in the network. The most effective means to gain high performance in good radio conditions is to come up with a optimized frequency plan. Frequency plan optimi- zation can make a significant difference for the achievable throughput.

Propagation estimations

Coverage Analysis

Interference matrix

• co-channel

• adjacent channel

Frequency plan

Separation constraints TRX requirements

Figure 4.5. Frequency planning principle

EDGE deployment doesn’t bring dramatic changes to radio network planning with GPRS. Main concerns are the allocation of capacity and steering of traffic to wanted layer/cell/TRX. Changes to transmission capacity will be needed, if larger scale EDGE deployment per cell/area is done.

The easiest way to implement EDGE from the network planning point of view is the TRX replacing strategy, where new frequency plan is not mandatory. The replacing can be done for every 1-3rd site to achieve coverage and EDGE services e.g. hotspots or rural area can be se- lected for EDGE, but with limited amount of data throughput.

Higher data amounts with EDGE can be offered if it is implemented by bringing an additional EDGE TRX dedi- cated to data usage to (some of) the cells in the network and/or by reserving more timeslots for the use of EDGE data users from the TRXs. However, that leads to decrease in the GoS experienced by the speech users. In real life these actions are not always possible to perform and they will require significantly more implementation and planning work.

In order to utilise EDGE performance in full, a totally new frequency plan and possibly new GSM cell structure are required.

5 VENDORS’ EDGE STRATEGIES

Due to the delays in UMTS implementation compared to the early predictions, most vendors have taken EDGE back to the table. EDGE as a technology was firstly developed to support the GSM evolution towards 3G in especially US markets. As UMTS hype began in 1999/2000 EDGE was put to less priority among most of the vendors, because UMTS implementation seemed to happen so fast and with large scale that it was natural to shift all focus to support this.

After the enormous UMTS license fees most of the operators’ capabilities to invest in to the networks were decreased significantly. At the same time making the UMTS technology work needed more work from the vendors than anticipated, which together with the operators decreased investment capabilities caused the delays in UMTS implementation. EDGE was again an issue, because the needed investments on it are a fraction of those needed for UMTS and the end user performance is quite close to UMTS in the beginning. Of course the capacity offered by UMTS

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is enormous compared to EDGE, but as there is no pres- sure on the capacity side for the operators (because the data traffic haven’t proved to increase still) UMTS capacity is not really needed yet.

When the US operators, for example AT&T, started to implement EDGE capable HW as they decided to go for the GSM evolution towards 3G rather than IS-95 based, there was suddenly a need for the operators to start making EDGE terminals as well. As the biggest reason for the US operators to choose GSM based system is the roaming traffic gained globally, there is a clear need to have EDGE happening in the Europe and Asia as well. This was the reason why EDGE marketing started again with full steam for European operators as well by the biggest vendors.

The biggest two vendors, Nokia and Ericsson, are the most active with EDGE marketing. Nokia has been clearly the market maker in Europe and Asia Pacific for EDGE. It’s of course in interests of all the vendors to make EDGE a success, but due to its strong position in terminal market, Nokia is in better position to drive the market than it’s competitors. Ericsson has clearly taken a follower role in EDGE market, focusing clearly on driving the UMTS market. This is also partly due to the difficult financial situation of Ericsson currently, where the ability to take risks in new market areas is limited. When the two vendors are compared from the point of view of needed in- crements to the legacy network infrastructure (to make EDGE possible), Ericsson is in stronger position than Nokia with better applicability of the older infrastructure in the field.

All the other noticeable GSM network vendors (Siemens, Alcatel, Motorola, Nortel) have taken a reactive role with EDGE, waiting for the market to start up. Outside USA there has been little marketing done for EDGE by these vendors and they are clearly waiting and seeing whether the big vendors (mainly Nokia) can have the market cre- ated for EDGE and then jumping on board. Of course they all have EDGE infrastructure and terminals as well in their road-maps, but they are not put into number one priority and committed on.

The problem with EDGE is for a network vendor that it has been earlier positioned as 3G technology thus com- peting with the UMTS market. So, as the potential UMTS market is clearly bigger than EDGE, it has been decided by most vendors not to drive EDGE strongly towards their customers. This could have an negative effect on the UMTS sales. The answer is to position EDGE more as a enhancement to existing GPRS networks and to co-exist with UMTS.

Currently as first Nokia and then Sony-Ericsson have committed to bring EDGE terminals to Europe-Asia GSM bands as well, it seems that the market is clearly starting.

The availability of terminals and thus necessary penetration is in vital role in possible EDGE success. [9][10][11]

6 SERVICES ENABLED BY EDGE

The Release 99 EDGE implementation does not offer significant new possibilities for services compared with the current HSCSD and GPRS networks.

As mentioned before, circuit-switched data connections up to 64kbps are sufficient for providing various transparent and non-transparent services, e.g. interworking with audio modems and ISDN at various data rates and various video based services ranging from still image transfer to videoconferencing services. Packet-switched connections are optimal for bursty data traffic, e.g. web browsing and email.

In Rel5 UMTS 3GPP traffic classes are enabled in EDGE and thus 3G services delivery across all frequency bands and bearers becomes possible. Handovers across GSM/

EDGE/WCDMA are enabled from the start. However, there are still uncertainties in standardization of Rel5 and the Iu interface.

When compared to GPRS phase 1 QoS classification, the QoS grouping of UMTS release 99 takes into account the applications that will become available through the increased data rates of UMTS and EDGE. The main distin- guishing factor between the traffic classes is the sensitiveness of applications, as presented in Table 6.1. [6]

Traffic class Example of application Fundamental characteristics Conversational Voice and video Preserve time relation between

class telephony information elements, low delay Streaming Real time Preserve time relation between,

class streaming video low level retransmission Interactive Web browsing and real Preservation of content,

class time control channels retransmission, "request response"

Background Downloading of files Delay insensitive, preservation of

class and email content, retransmission

Table 6.1. QoS classes for UMTS and EDGE

Conversational and streaming classes are mainly intended to be used to carry real-time traffic flows. The main difference between them is the delay sensitiveness of the classes. Interactive class and background class are mainly meant to be used by the Internet type applications e.g.

web browsing and e-mail. Due to looser delay requirements compared to conversational and streaming classes, both provide better error recovery by means of retransmission.

Datarate

ConversationalBackground

0 8 16 48 128 473 2048

ConversationalInteractiveConversationalStreamingConversational _Voice

Corporate solutions Infotainment

Voice

FAX Collaborative working

Communication Transaction

services Advertising

Audio clip downl.

Video clip downl.

Short Messaging

Corporate Data Access WEB Browsing WAP Applications

E-mail

Video streaming

Multimedia Messaging

Video telephony

Audio streaming Gaming

WCDMA WCDMA

EGPRS EGPRS GPRS GPRS

Figure 6.1.Service QoS Requirements for Bearers, Data rates and services 2003 [7]

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The main difference between interactive and background class is that interactive class traffic will have higher priority in scheduling than the background class traffic. This means that background applications may use transmission resources only when other applications do not need them. [3]

Although the conversational class is specified in the QoS classes of UMTS release 99, the most delay-critical applications such as speech and video telephony will be carried on circuit-switched bearers in the first phase of the third generation mobile networks. Later it will be possible to support delay-critical services as packet data with QoS functions. Different QoS requirements of services are shown in Figure 6.1.

7 TERMINAL AVAILABILITY

The first terminals for EDGE will be on the market by 2H2003 by Nokia and Motorola. These are aimed for the US market, but will have also European GSM frequencies available. For example the Nokia 6200 will have GSM 1900/1800/800 frequencies and support for MCS1-9. With the same timetable Nokia will also introduce an EDGE terminal with GSM 900 frequency available.

The Motorola t725 will have also both European frequencies imbedded and supports MCS1-9. The t725 will be available by 2H2003.

Sony-Ericsson has also said that it will bring EDGE capable terminals for both European and US markets in the second half of 2003. An interesting product will be also the PC-card with GPRS/EDGE from Sony-Ericsson, which will be available also in the second half of 2003.

The most important fact when EDGE terminals are considered is the information given by Nokia, that it will include EDGE to all of its GPRS terminals that are introduced after 6/2003. Nokia has also said that it will have EDGE included in all of its terminal categories from the beginning of 2004. This is extremely good news for EDGE, since it almost positively ensures that the terminal penetration will start to develop and that other vendors will join in manufacturing EDGE terminals. It also gives operators a positive signal to include EDGE in their network evolution strategy as a realistic option. [9][11]

8 INVESTMENT COSTS AND REVENUES EDGE is a further development of the GSM/GPRS networks and thus it can be integrated in the already estab- lished GSM/GPRS networks with relatively low investment. Beside from the hardware and software upgrades, it only affects the network by increasing capacity and data rates. The cost of operation will not increase. Operators can deploy EDGE using the existing GSM spectrum.

EDGE has higher spectral efficiency than GSM/GPRS and thus there is free capacity for carrying more data and voice traffic and for serving more subscribers.

The size of the investments on EDGE depends on the operator. The worst case is that large part of the network infrastructure is old enough to not support easy EDGE implementation. The capability of the infrastructure depends of the network vendor. In some cases the base stations must be fully replaced by newer ones before EDGE can be implemented. In typical cases only EDGE capable TRXs and BSS software must be implemented along with changes to Abis interface capacity. If the network infrastructure is new enough, the base stations can be already equipped with EDGE capable TRXs. Then only software and enhanced transmission capacity must be implemented and thus costs can be kept quite minimal.

In typical cases of operators’ network evolution the changes are made concurrently as much as possible. This means that for example if the network infrastructure is old enough to require new base stations if EDGE is considered, can the changes planned so that UMTS/EDGE capable base stations are introduced at the same time. This lowers the needed investments (and the operational ex- penses) for EDGE, which would separately be quite enormous. Similarly EDGE capable infrastructure can be moved to replace older infrastructure in the needed areas if available. This also makes the investments lower. De- pending on the situation of the operator, the following costs are related to EDGE implementation:

- EDGE capable GSM/GPRS base stations - EDGE capable TRXs

- EDGE capable BSS software - Possible capacity upgrades to BSC - Enhancements to Abis capacity - NMS/OMC changes

- Possible upgrades to GPRS core network

- Network planning costs (site configuration planning, frequency planning etc.)

- Operational costs of implementation

Since the investments needed for EDGE are highly dependant on operators network, strategy and cost structure and network vendor’s capability and pricing towards a specific operator, it’s quite impossible to give generic cases of the needed total investments. It can however be said that they are a fraction of that needed for UMTS. EDGE can be implemented to every third site for example, so it enables lots of different capacity/coverage strategies, which can be used to optimize the costs involved. Some practical cases have shown that the pricing for EDGE TRXs and BSS software is quite similar or only a bit higher to that of GPRS equipment. This can also be due to the fact that the vendors need the reference networks up and running, which usually means that the margins for the sales are kept lower than usual.

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As the EDGE capable terminals reach a feasible penetration percentage, the data traffic is more economical to be served with EDGE rather than GPRS, this is because the capacity provided by EDGE is almost 3-fold compared to GPRS, with relatively small investments needed. This fact also allows more capacity for speech service, taken that the network is parameterized accordingly. This enables greater revenues for an operator. Also the higher throughput offered by EDGE for the users can be priced higher than the conventional GPRS. Later if the GERAN offers same QoS functions as UTMS it will create even more possibilities to generate revenue from the users. [11]

9 EDGE INVESTMENTS STRATEGIES Different second-generation systems have different evolution paths towards third generation IMT-2000 services.

Network operators that are not granted UMTS licenses can implement EDGE to offer IMT-2000 alike services.

However, an operator with UMTS license may still deploy EDGE to create a wireless data market before third generation CDMA systems are launched or use EDGE in areas where there is no UMTS service.

9.1 GSM operators without 3G licenses

For those operators without 3G license, EDGE offers a pretty straightforward business case as a stepping stone before UMTS. Of course an operator can choose not to go for UMTS at all and offer high data rate services with GPRS/EDGE network. This type of stepping stone approach is currently used by some of the US operators (such as AT&T), which have not decided the UMTS bandwidth and are implementing GSM-EDGE networks as this is written. In Europe most of the countries have already granted their licenses so there are very few left to implement this strategy. In Asia, there is a technology standard war going on between CDMA2000, WCDMA and TD- SCDMA. In this area EDGE is clearly seen as a less attractive option.

EDGE as a stepping stone to UMTS can be seen only feasible in markets with no strong UMTS commitment:

No licenses yet awarded or they are very inexpensive or no present market push for 3G or if the GSM business is still developing. Besides US, this kind of situation exists e.g. in East-Europe. Although if the first UMTS launches (e.g. Hutchison UK, Italy) are successes and UMTS terminals come faster to market and are more strongly sub- sided than the EDGE terminals, then the window for EDGE feasible will become smaller rapidly for this type of strategy. The only clear situation is in the US, because they will not have UMTS licenses awarded for some time.

If this type of strategy is chosen by the operator, all the services can/will have to be planned on top of GSM- EDGE. This means that if for example streaming services are to be offered must EDGE standardization support this.

In the first releases of EDGE the QoS will be similar to GPRS, which doesn’t enable similar services as can be offered by the UMTS.

EDGE as a stepping stone can require EDGE to be implemented over the network, which of course will make the investments bigger as well. If the network is built directly to support EDGE then the investments can be made smaller. Of course EDGE can be implemented only to e.g. cities and GPRS elsewhere, which lowers the incremental costs.

9.2 GSM operators with 3G license

EDGE and WCDMA can also be complementary 3G technologies that together will sustain the operator’s need for nation-wide mobile data and speech capacity during the expected traffic boom. They are both IMT-2000 capable radio access technologies in different frequency bands.

They can both provide 3G services for the end-user, accessing a common core network, given that the Iu-interface is standardized to be supported by the GERAN as well.

Possible business cases for the operator with a UMTS license are for example the following:

EDGE used as a complementary solution, to different coverage areas. In this case EDGE is implemented e.g.

to more rural areas and UMTS to the cities and sub-urbans and main roads. This case makes it possible to offer high- data rate services also in the areas where UMTS coverage is not available. The investments of EDGE implementation can be made lower by guaranteeing that the infrastructure in the “EDGE areas” is the most EDGE capable one, if possible by swapping.

This case requires though that there will be multi-mode terminals available quite rapidly (i.e. UMTS/EDGE/

GPRS), because otherwise the experienced throughput can be higher in the rural areas than in the cities, which is not very feasible.

EDGE and UMTS co-exist, for different user segments.

In this case EDGE and UMTS are implemented to same coverage areas, but used to serve different user segments.

For example EDGE could be used to offer robust data for corporate access and UMTS to offer fancy 3G services, such as video streaming etc.

This case will require quite large investments, because EDGE is to be implemented over the network or at least to most locations. This case would also require that there would not be multi-mode terminals widely available very rapidly, so the segmentation could be made more easily through terminals. [11]

10 FUTURE ROLE OF EDGE

In Figure 10.1, the current situation of EDGE globally is depicted.

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Figure 10.1. Global situation of EDGE in 2002.

As can be seen from the figure, the only market areas in which public commitments to EDGE have been made is the US and Asia Pacific. In Europe, which is the key market area for a larger scale EDGE success, has not yet seen any public EDGE commitments from the operators. Al- though the biggest vendors claim to have multiple con- tracts for EDGE deliveries, no of them are public yet in Europe.

The future role of EDGE depends very highly on the following:

- The success of EDGE in USA - The availability of EDGE terminals - The early success of UMTS - Subsidisation of UMTS terminals

- The completeness of EDGE standardization

The biggest guarantee that EDGE will become one of the steps of GSM network evolution, which be implemented as well, is the availability of EDGE capable terminals.

This has already happened as Nokia & Motorola will bring the terminals by the 2H of 2003. Basically this was obvi- ous after the big US vendors started to implement GSM- EDGE networks. The only question mark is whether EDGE will be widely deployed or will it become a niche technology.

This depends much on the early success of UMTS in Eu- rope. If the first implementations in 1H2003 succeed, which will bring in more network launches in 2H2003 and 1H2004, then EDGE will more probably stay as a niche technology deployed only to part of the networks.

This is because when UMTS succeeds, the focus of the industry is again shifted to UMTS and the investments on GSM networks will be minimized. Then EDGE will probably experience similar situation as HSCSD did. Most probably there will be also operators, which will not go for UMTS in the near future and for those EDGE offers a feasible solution. Altogether early UMTS success would

make EDGE a niche technology.

If UMTS success won’t happen in short term, due to for example technical difficulties, then EDGE has a better chance to become a widely deployed technology. In this case there will be wider range of EDGE terminals available before UMTS is deployed in larger scale. This will also bring in more EDGE operators as the investments on network technology are considerably smaller.

The long-term success of EDGE is also dependant on the operators strategy on driving UMTS with terminal subsidization. This is easily the case in countries where the license terms are tight and demand a quite rapid and wide UMTS deployment.

The most probable case is that EDGE will live alongside UMTS and will in most cases be used as a geographical complement to UMTS. The UMTS early success is not very likely, so it will give operators a chance to consider EDGE as well (which is already ready as a technology) and invest still to their GSM networks. Also as the technology develops in the future, it will be more likely that EDGE will be included in the terminals very cheaply in the long run. This makes the multi-mode terminal manufacturing more feasible to the vendors. So it seems that EDGE will have a relatively good future ahead, especially in those countries, which don’t have too tight UMTS license terms for the operators or have granted licenses cheap. In the long run the standardization must succeed to include the Iu-interface support to GERAN, otherwise EDGE can easily be positioned as the “poor man’s UMTS”

in the market as similar QoS and services cannot be offered. [9][10][11]

11 CONCLUSIONS

EDGE is relatively easy and cheap to bring to the operators network. It demands for significantly minor changes to the operational side as well. This means that it can be quite attractive for an operator, which have not made strong commitments to UMTS.

EDGE uses 8-PSK modulation, which enables approxi- mately 2,5 times the performance or capacity of GPRS.

This new modulation scheme requires new radio parts for the terminals as well, which means that new terminals must be introduced from the vendors and the penetration of the EDGE capable terminals grow enough before this capacity gain compared to GPRS can be fully utilized by the operators. At the moment there are commitments made from the biggest vendors to introduce EDGE terminals by 2H2003.

The size of the investments on EDGE depends on the operator. The worst case is that large part of the network infrastructure is old enough to not support easy EDGE implementation. The capability of the infrastructure depends of the network vendor. In some cases the base stations must be fully replaced by newer ones before EDGE can be implemented. In typical cases only EDGE capable TRXs and BSS software must be implemented along with

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changes to Abis interface capacity. If the network infrastructure is new enough, the base stations can be already equipped with EDGE capable TRXs. Then only software and enhanced transmission capacity must be implemented and thus costs can be kept quite minimal.

The strategy for an operator to choose on EDGE depends on many things. Most of it can be even personal (prefer- ences of decision making people) or contractual (towards vendors) reasons, which drive the network evolution. But in principle one deciding factor is the commitment towards UMTS and the license terms of the UMTS license.

For those operators without 3G license, EDGE offers a pretty straightforward business case as a stepping stone before UMTS. For operators with UMTS license a strategy of EDGE and UMTS co-exist, but for different user segments, can be useful if EDGE is decided to be deployed as widely as (or wider than) UMTS. Another strategy can be seen to deploy EDGE as a complementary solution, to different coverage areas. This is the most feasible strategy if there are multi-mode terminals available widely.

The future role of EDGE depends very highly on the success of EDGE in USA, the availability of EDGE terminals, the early success of UMTS, subsidization of UMTS terminals and the completeness of EDGE standardization.

The most probable case is that EDGE will live alongside UMTS and will in most cases be used as a geographical complement to UMTS. The UMTS early success is not very likely, so it will give operators a chance to consider EDGE as well (which is already ready as a technology) and invest still to their GSM networks. Also as the technology develops in the future, it will be more likely that

EDGE will be included in the terminals very cheaply in the long run. This makes the multi-mode terminal manufacturing more feasible to the vendors. So it seems that EDGE will have a relatively good future ahead, especially in those countries, which don’t have too tight UMTS license terms for the operators or have granted licenses cheap. In the long run the standardization must succeed to include the Iu-interface support to GERAN.

REFERENCES

[1] http://www.nokia.com (accessed 2003)

[2] http://www.ovum.com/go/ovumcomments/016489.htm (accessed 2003)

[3] Halonen T, Romero J, Melero J 2002. GSM, GPRS and EDGE performance - Evolution towards 3G/UMTS. Wiley.

[4] http://www.ericsson.com/products/white_papers_pdf/

edge_wp_technical.pdf (accessed 2003)

[5] Penttinen Jyrki. 2002. GPRS in Wireless Data. WSOY.

[6] Rantanen J. 2001. The Third Generation Cellular Network Solutions from Operator’s Perspective. Master’s thesis. TKK.

[7] Auramo J. 2002. Enhance Your GSM Networks to 3G with EDGE. Presentation. Nokia.

[8] www.ericsson.com (accessed 2003)

[9] 3GSM World Congress 2003, Cannes, France, 17-22 Feb- ruary 2003.

[10] “Advanced Mobile Networks in Practice” Conference, Helsinki 11-14 November 2002 .

[11] Sources within Telecommunications Consultancy company Omnitele Ltd.

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ABSTRACT

Since the analog cellular systems involved in our life, mobile communications have evolved to its third generation (3G). The richness of features and functionalities with high quality of service in 3G will bring people to a fascinating world. UMTS is the European vision of 3G mobile communication systems. One of the key functionalities of UMTS is the ability to provide services anywhere and anytime. In UMTS the mobile equipment will be used for any possible purpose such as communication, entertainment, business and all kinds of services. This essay briefly reviews the evolution of UMTS systems as a 3G platform for mobile communications, classifies the end user services provided by UMTS, analyses the UMTS markets, and presents UMTS vendors’ products and strategies as well as their recent activities in 3G. The specification on 3G is an evolving process. Many features and functionalities of UMTS are still under development.

Vendors battle on pushing their UMTS networks and technologies. Though the process of development and deployment UMTS will be tough, UMTS shall finally change the way of our life and bring people to a brilliant new world.

1 INTRODUCTION

Since the introduction of commercial cellular systems in the late 1970s and early 1980s, mobile communication is evolving to its third generation, 3G. The first generation, 1G, mobile communication systems transmit only analog voice information and provide basic mobility. The most prominent 1G systems are Advanced Mobile Phone Sys- tem (AMPS), Nordic Mobile Telephone (NMT), and To- tal Access Communication System (TACS). They were incompatible due to the scope of national specifications.

The development of the second generation, 2G, mobile communication systems was driven by the growth need for systems compatibility, capacity, coverage and improved transmission quality. The development of 2G mobile communication systems started in early 1980s. 2G emphasized on the mobile networks compatibility. Speech transmission was still the main supported services, but data transmissions and supplementary service such as fraud prevention and encrypting of user data became standard features of 2G systems. The main 2G systems include:

- Global System for Mobile Communications (GSM) was firstly opened in Finland in 1991.

- Digital AMPS (D-AMPS) started its commercial operation in US in 1994.

- Personal Digital Cellular (PDC) was put into commercial use by NTT in Japan in 1994.

- Code Division Multiple Access (CDMA) started its commercial operation in Hong Kong and Korea in 1995.

Today, multiple 1G and 2G standards are used in worldwide mobile systems, and most of them are incompatible.

The most successful implementation of 2G is GSM. Due to the regional nature of 2G mobile communication systems specifications, GSM did not succeed completely in implementing globalization.

Based on GSM, the third generation, 3G, aims to implement the globalization of mobile communications. The research for 3G started in 1991. The primary requirements for 3G as described in (Kaaranen, et al. 2001, p. 2) are:

- The system must be fully specified and world-widely valid, the major interfaces of the system should be standardized and open.

- The system must have clearly added value to GSM in all aspects and be backward compatible at least with GSM and Integrated Services Digital Network (ISDN) at the beginning.

- The system must support multimedia and all of its com- ponents.

- The radio access of 3G must provide wideband capacity be generic enough to be world-widely available.

- The services must be independent from radio access technology and the network infrastructure must not limit the services to be generated.

With the evolution of communications technologies, the traditional telecommunications and the Internet are merging rapidly. The combination of these two worlds and the trends of telecommunications moving to “All IP” require 3G to fulfill more requirements except above primary ones to fit the changes.

Universal Mobile Telecommunications System (UMTS) (Kaaranen et al. 2003) is the European vision of 3G mobile communication systems. It represents an evolution in terms of services and data speeds from today’s 2G

UMTS and Its Market Analysis

GUOYOU HE

TELECOMMUNICATION SOFTWAREAND MULTIMEDIA LABORATORY

FIN-02015 HUT, ESPOO, FINLAND GHE@CC.HUT.FI

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mobile networks. UMTS represents the move into 3G of mobile networks. It addresses the growing demand of mobile and Internet applications for new capacity in today’s overcrowded mobile communications. UMTS increases transmission speed up to 2 Mbps per mobile user and establishes a global roaming standard. It allows many more applications to be introduced to a worldwide base of users and provides a vital link between current multiple GSM systems and the ultimate single worldwide standard systems for all mobile telecommunications.

The specifications of UMTS are under development in Third-Generation Partnership Project (3GPP) (3GPP 2003). To reach global acceptance, 3GPP is introducing UMTS in phases:

3GPP R99 Most of the specifications were frozen in March of 2000. It laid the foundations for high-speed traffic transfer in both circuit switched and packet switched modes by defining enhancements and transitions for existing GSM networks and specifying the development of new radio access network.

3GPP R4 Most of the core technical specifications were frozen in March 2001. It is a minor release with the evo- lutions including Universal Terrestrial Radio Access Net- work (UTRAN) access with Quality of Service (QoS) enhancement, Circuit Switched (CS) domain evolution with introducing Mobile Switching Center (MSC) server and Media Gateways (MGWs) based on IP protocols, enhancements in Location Communication System (LCS), Multi- media Messaging Service (MMS), Mobile Execution En- vironment (MexE), etc.

3GPP R5 Most of the specifications and technical reports were frozen in March 2002 or June 2002. It is a major release aiming to utilize IP networking as much as possible. IP and overlying protocols will be used in both networks control and user data flows, i.e. implement “All IP” network, but the IP-based network should still support circuit switched networks. The features of this release mainly include the introduction of IP Multimedia Subsystem (IMS) (3GPP 2002e), enhancement in Wideband Code Division Mutiple Access (WCDMA) (Holma and Toskala 2001), MMS, and LCS. In 3GPP R99 the basis for the UMTS radio access is WCDMA. In 3GPP R4/R5 GSM/EDGE Radio Access Network (GERAN) is specified as an alternative for radio access to build a UMTS mobile network.

3GPP R6 It is still being defined with the target June 2003.

In this release, a lot of enhancements and improvements in IMS, Multimedia Broadcast/Multicast Service (MBMS), MMS, QoS, GERAN will be specified. Many new services such as digital rights management, speech recognition and speech enabled services and priority service will be specified.

UMTS is already a reality. Japan launched the world’s first commercial WCDMA network in 2001. Nokia and AT&T Wireless complete first live 3G EDGE call on November 1, 2001. Telenor launched the first commercial UMTS network in Norway in December 1, 2001. On February 20, 2002, Nokia and Omnital Vodafone made

the first rich call in an end-to-end All IP mobile network.

In 2002, many of the main UMTS vendors announced their progresses in the battle of pushing their 3G networks and technologies (UMTS Forum 2003; UMTS World 2003). The main purpose of this paper is to review the evolution of UMTS, investigates the UMTS services and market situation of UMTS deployment, and analyzes the current situation of UMTS development.

2 EVOLUTION OF UMTS

To address the globalization issues, 3G introduces WCDMA (Holma and Toskala 2001) as the new radio access method. WCDMA is a global system for 3G mobile communications and allows all 3G subscribers to be able to access all 3G networks. It has better spectral efficiency than Time Division Multiple Access (TDMA) in certain condition and is more suitable for packet transfer than TDMA based radio access. For using WCDMA, new radio access network, UTRAN, composed of Base Sta- tion (BS) and Radio Network Controller (RNC), has to be added due to the incompatibility between WCDMA elements and GSM equipment, and the interoperability of GSM/UMTS has to be handled. For taking care of the interoperability, EDGE Radio Access Network (E-RAN) is modified to be able to broadcast system information about WCDMA radio network in its downlink and interworking functionality is introduced into the evolved 2G MSC/VLR for handling WCDMA.

The 3GPP R99 (3GPP 2002a) of UMTS introduces WCDMA as radio access and effectively utilizes existing GSM/GPRS system providing the basic communication services for both (Circuit Switched) CS and Packet Switched (PS) traffic together with a rich set of Value Added Service (VAS) and supplementary services. The Core Network (CN) is divided into CS domain and PS domain for handling circuit switched and packet switched traffic respectively.

The CS domain contains 3G MSC/VLR and Gateway MSC (GMSC). These two elements can be physically separated or combined. The 3G MSC/VLR evolves from GMS MSC/VLR by merging the transcoders required for speech coding conversion from the radio network to MSC/

VLR. The Visitor Location Register (VLR) is an integral part of the Mobile Switching Center (MSC) in 3G. The 3G MSC/VLR is responsible for CS connection management activities, Mobility Management (MM) related issues such as location update, location registration, paging and security activities. The GMSC takes care of the incoming/outgoing connections to/from the external networks. It initiates a location info retrieval procedure to find the correct 3G MSC/VLR for call path connection, and establishes a call path towards the 3G MSC/VLR under which the addressed subscriber is to be found.

The PS domain is evolved from General Packet Radio Service (GPRS) (GSM Association 2003). It contains Serving GPRS Support Node (SGSN) and Gateway GPRS Support Node (GGSN). The SGSN node supports packet communication towards the access networks for both GSM

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Base Station Subsystem (BSS) and UTRAN. SGSN mainly takes care of Mobility Management (MM) related issues such as route update, location registration, packet paging and security. The GGSN node maintains the connections towards external packet switched networks such as Internet. This node is responsible for route info retrieval and routing packets to/from SGSN for further relaying. It also takes care of session management.

The Registers part is composed of Equipment Identity Center (EIR), Home Location Register (HLR) and Au- thentication Center (AuC). This part does not deliver traffic. Instead it contains addressing and identity information required for MM and security for both CS and PS.

HLR contains permanent data of the subscribers and is responsible for MM related procedures. AuC is a data- base generating the Authentication Vectors that contain the security parameters used for security activities, it can be an integrated part of HLR. EIR contains the identification information related to the User Equipment (UE).

Compared to R99, the changes in 3GPP R4 (3GPP 2002c) are extended remarkably to CN instead of in the radio access network. Especially in the CN CS domain, the MSC/VLR and GMSC are evolved into (G)MSC server and MGW to separate Communication Management (CM) and actual switching as well as related functions into separate physical entities.

The MSC/GMSC server is evolved from the MSC/GMSC.

It mainly comprises the call control and mobility control parts of a MSC/GMSC. Whole connection process is con- trolled by the (G)MSC server(s), user data goes through MGWs, which maintain the connection and act as

switches. The MSC server contains CM main functionality and takes care of MM. VLR is also integrated into it.

The MGW contains the functionality of performing actual switching and network inter-working. It may contain other functionality such as performing circuit packet conversion in VoIP calls, etc. The relationship between MSC/

GMSC server and MGW is one to multiple. It means that one MSC/GMSC server can control numerous MGWs.

The number of MGWs under one MSC/GMSC server is scalable and the MSC server amount may be dimensioned in the system.

The largest new functionality in 3GPP R5 (3GPP 2002d) is IP Multimedia Subsystem (IMS) (3GPP 2002e). IMS has a uniform way to Voice over IP (VoIP) and other real- time and non real-time IP services such as multimedia services. All the access networks can be IP based. The traffic can be always packet switched, and all the services can be moved to the PS domain. The HLR is evolved to Home Subscriber Server (HSS) providing enhanced features for support IMS. 3GPP R5 contains all the possibilities for traffic treatment. No matter the traffic coming from the access network is packet switched or circuit switched, which can be relayed to the external network either in circuit switched or in packet switched manner.

In 3GPP R5, the GERAN can be connected to the CN with Iu interface. Regarding to this interface, the traffic from GERAN can get the same treatment as the traffic from the UTRAN. When IMS is in use, the CS domain will not be need any more. So one of main differences between R4 and R5 is that CS can quit service in R5, and the whole network will finally transfer to “All IP”.

Category Description

Fun WWW, video, post card, snapshots, text, picture and multimedia messaging, datacast, personalisation applications (ring tone, screen saver, desk top), jukebox, virtual companion, etc.

Work Rich call with image and data stream, IP telephony, B2B ordering and logistics, information exchange, personal information manager, dairy, scheduler, note pad, 2-way video conferencing, directory services, travel assistance, work group, telepresence, FTP, instant voicemail, colour fax, etc.

Media Push newspaper and magazines, advertising, etc.

Shopping E-commerce, e-cash, e-wallet, credit card, telebanking, automatic transaction, auction, micro-billing shopping, etc.

Entertainment News, stock market, sports, games, lottery, gambling, music, video, concerts, adult content, etc.

Education Online libraries, search engines, remote attendance, field research, etc.

Peace of mind Remote surveillance, location tracking, emergency use, etc.

Health Telemedicine, remote diagnose and heath monitoring, etc.

Automation Home automation, traffic telematics, machine-machine communication, etc.

Travel Location sensitive information and guidance, e-tour, location awareness, time tables, e-ticketing, etc.

Add-on TV, radio, PC, access to remote computer, MP3 player, camera, video camera, watch, pager, GPS, remote control unit, etc.

Table 3-1: The possible types of services in 3G networks