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Pipeline Publishing, Volume 7, Issue 10

	This Month's Issue:
	Unlocking Next Gen Networks

What You Really Need to Know About Solving the Capacity Crunch

By David Chambers

The growth of next generation networks like LTE have ushered in quite a quandary for service providers around the world. Wireless providers are now, or will soon be, able to offer high-speed, low-latency data in many areas, but this is proving to be a double-edged sword as rapidly increasing consumption of mobile data traffic is causing a “capacity crunch” for many of them. A number of wireless providers are facing major challenges as a result and must re-evaluate how best to meet forecast demand and charge for usage while providing a user experience customers demand.

As traffic levels grow, some popular solutions wireless providers are actively considering or currently implementing include investing in more 3G capacity, offloading to Wi-Fi or femtocells, and optimizing pricing policies to change user behavior. However, in order to truly optimize next-gen networks in terms of revenue growth and customer experience, wireless providers need to take a much more holistic look at the issues across various departments like pricing, marketing, and applications.

Working to optimize any piece of the network in one siloed department is a bit like trying to solve a city’s major traffic congestion issues only by building more roads. Eventually, those roads will clog up as well. Smart city planners and engineers would look at different combinations of solutions that can work together, such as building new roads and encouraging telecommuting, adding more bus and public transportation routes, etc.

In that same vein, there is no single strategy wireless providers can implement to solve the capacity crunch problem. They must make their own selection from a wide range of technical and marketing approaches across various departments. The different mixes they choose will begin to differentiate the customer experience from different wireless providers and usher in a new era in competition for the telecommunications industry.

With that in mind, let’s take a look at ten complimentary capacity crunch solutions wireless providers may consider:

Increasing consumption of mobile data traffic is causing a “capacity crunch” for service providers.

Traffic shaping: With extreme examples of unlimited data use being quoted by several network providers – and figures of 40-50% of network capacity being consumed by 2-3% of users being commonly cited – traffic shaping alone could dramatically increase available capacity. A common example is tracking the monthly data usage of subscribers and throttling back or reducing data speeds when the usage cap has been exceeded. Service providers have found more positive results from their customers by taking this approach. Individuals can choose to accept the reduced service for the remainder of their monthly cycle, or pay a fee to restore high-speed capacity immediately.

Expand range of data tariffs: Many providers have recently introduced monthly caps on their data plans to help solve capacity crunch issues. With this approach, educating the customer so that the meaning of data tariffs is fully understood is key.

Approaches to consider include charging premiums or blocking some types of data traffic, such as streaming video which places high demands on network resources. Such services may be restricted to offpeak times or only through Wi-Fi/femtocells on some tariffs; premium tariffs could be charged for higher performance and/or priority.

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