SPRING 2008
UMA ToDAY
17
For mobile operators, one of the most successful weapons in the battle for the building is the
deployment of Home Zone services. A Home Zone service is based on a mobile operator defining
a service area around a subscriber's home where the operator can aggressively price service. For
example, when a subscriber is within his or her Home Zone (i.e., the subscriber is being served by
the cell tower nearest to home), mobile calls are charged at land-line rates. Introduced in a number
of Western European countries, these first-generation Home Zone services have proved popular with
consumers. Unfortunately, as these services are based on using the macro radio access network
(RAN), they also present a number of significant challenges for mobile operators.
Revenue Leakage:
As a subscriber's "Home Zone" is based on the cell tower(s) that services their
home, in many situations a subscriber could be served by the same tower throughout their day,
whether at home, work or in transit.
Shrinking Margins:
As the Home Zone service uses the macro RAN, an operator's cost of service
delivery remains the same. As a result, operators are directly sacrificing service margins.
Poor Performance:
Unfortunately, the home is often ill-served from the macro RAN, as it is
plagued by poor indoor coverage, particularly with high-speed 3G technologies.
To address these cost and performance challenges, mobile operators are beginning to launch the
next generation of Home Zone services, known as "Home Zone 2.0" (HZ2.0). HZ2.0 services are
defined by two primary characteristics.
First, they use a low-power femtocell or Wi-Fi access point deployed within a subscriber's home to
address revenue leakage and poor performance.
The low-power access points overcome wireless service coverage issues. Moreover, these access
points improve the performance of the handset in the home because the radio resource is closer to
the device. The signal is stronger and as a result, data rates are typically higher. A stronger signal
also leads to lower power consumption on the handset, as the handset needs to transmit only a short
distance. Finally, offloading voice and data traffic to the micro radio access point frees up valuable
macro network spectrum for outdoor mobile service delivery.
With a relatively small coverage radius (typically within the home), low-power access points
constrain the home `zone' and address the revenue leakage issue of alternative approaches. This
improved Home Zone resolution helps operators keep the benefits of the HZ2.0 service actually within
the home.
Second, HZ2.0 services use a subscriber's existing home broadband access connection for
backhauling mobile services. Broadband penetration in developed markets ranges from 35-60% of
households. For mobile operators, broadband represents an ultra-low cost transport network that
improves the margins for voice and data service delivery.
Also, a wired broadband network provides fast, reliable IP transport for new revenue-generating mobile
data services. When delivered through high-speed 3G femtocells or Wi-Fi connections, subscribers get
a true broadband mobile data experience.
HoMe Zone 2.0 DePLoYeD ToDAY
Home Zone 2.0 is not just a concept; operators
have begun to deploy services today. ABI Research recently published a report projecting the number
of HZ2.0 (femtocell and dual-mode handset (DMH)-based) subscribers to reach more than 250
million worldwide by 2012.