News Brief

ZTE Awarded the Best Practice Award2010 Competitive Product for Packet Transport Network Industry Accolade By Frost & Sullivan
9 September 2010, Shenzhen ZTE today announced it has won the prestigious Best Practice Award 2010 Competitive Product for Packet Transport Network Industry. The accolade was awarded to ZTE by Frost & Sullivan, a world leader in growth consulting company. Winning this award is a direct recognition of ZTEs contribution to the PTN field. This is the second time ZTE has won one of the celebrated Best Practice Awards following receipt of the Best Practice Award2009 IPTV Equipment Vendor of the Year in 2009. Based on its research in 2009, Frost & Sullivan believed that with the acceleration of the commercialization of PTN, this market is beginning to take shape. Based on its unique market engineering method, Frost & Sullivan conducted a comprehensive evaluation of the PTN market, organizing an expert panel to evaluate the overall strengths, market share, technical strengths and product advantages of a number of mainstream vendors in the industry including ZTE. With its significant advantages in PTN technologies and commercial deployment, ZTE won the honor. Since starting its PTN standard research and product development in 2004, ZTE has submitted 118 proposals, 164 invention patents and 13 basic patents related to international standards to organizations including IEEE, ITU-T, and IETF. ZTE is a key player driving the development of PTN technologies and industry supply chains. ZTE was the first in the industry to introduce an entire range of PTN products, covering the entire network from the core layer to the access layer. All five of ZTEs PTN products have powerful networking capability and application support capability, enabling support for the most accurate and refined time synchronization solutions in the industry. The large capacity and low power consumption design can fully meet the green evolution needs of networks as well as their core business needs. As the industrys first-class PTN solutions provider, ZTE has entered into in-depth partnerships with operators across the globe, with solutions widely adopted in many countries and regions including Finland, The Republic of Montenegro, Brazil, Malaysia, and Vietnam. In the Phase-1 PTN project for China Mobile, ZTE has successfully delivered commercial PTN networks in 27 provincial regions including Beijing, Shanghai, and Guangdong. According to the Market Share: 1Q10 optical networks, global and regional report by leading market research firm Ovum, ZTE continued to maintain fast growth in the optical networking market and was already one of the global top 3 players in terms of market share. PTN has become a key driver for ZTE in the deployment of next generation optical networking technologies, in order to excel in the marketplace.

www.zte.com.cn

A Monthly Publication

Vol. 12 No. 10 Issue 129 October/2010

P3

Press Clipping Mobile Data Demand Will Expand Market for TDD, Says ZTE Head
An exclusive interview with Shi Lirong, CEO of ZTE, by leading industry magazine Global Telecoms Business

Focus

P7

Building Profitable Bearer Networks

P12

ZTE seeks to work with operators to build profitable and evolvable bearer networks through sound solutions, quality equipment, and first-class service

A Reconfigurable Gateway for the Coexistence of PTN and MSTP

Considering the long-term coexistence of 2G and 3G, the best way to capitalize on existing network infrastructure is to carry 2G voice services over SDH, and 3G and EOS services over PTN

P10

Cluster Routers: The Best Choice for Future-Oriented Backbone Networks

The reliability, scalability, and energy efficiency of an IP backbone network gives operators a distinct market advantage

P14

Promonte Leads with All-IP Transformation

The successful implementation of the Promonte project helped the company improve the quality of its mobile bearer network

Interview Rooted in China: Stepping Forward to World-Class Excellence

An interview with Zeng Xuezhong, Senior Vice President of ZTE Corporation

Editorial Board

16

Editor-in-Chief: Jiang Hua Deputy Editor-in-Chief: Huang Xinming Editorial Director: Zhao Lili Executive Editor: Yue Lihua Editor: Paul Sleswick Circulation Manager: Wang Pingping

Third Eye Future-Oriented IP Services Boost Operators Ability for Service Delivery
ZTE is expected to succeed in gaining access to the high-end optical network equipment market with the introduction of ZXONE 8000

20

Subscription / Customer Services

Subscription to ZTE TECHNOLOGIES is free of charge Tel: +86-551-5533356 Fax: +86-551-5850139 Email: wang.pingping@zte.com.cn Website: www.zte.com.cn

P21

P24

Editorial Office
Address: NO. 55, Hi-tech Road South, ShenZhen, P.R.China Postcode: 518057 Tel: +86-755-26775211 Fax: +86-755-26775217 Email: yue.lihua@zte.com.cn

Research Note LTE-A Leads Future Wireless Communications

By introducing key techniques including Carrier Aggregation (CA), enhanced MIMO, relay, and Coordinated Multi-Point Tx/Rx (CoMP), LTE-A can meet or even surpass all IMT-A requirements

21

ZTE Profile
ZTE is a leading global provider of telecommunications equipment and network solutions. It has the widest and most complete product range in the worldcovering virtually

Business Model Analysis of Managed Services

Managed services are driven by the transformation of telecom operations in terms of financial targets, business performance, deployment capability, management optimization, and risk transfer

24

every sector of the wireline, wireless, service and terminals markets. The company delivers innovative, custom-made products and services to over 500 operators in more than 140 countries, helping them achieve continued revenue growth and shape the future of the worlds communications.

News Brief

27
October 2010

ZTE TECHNOLOGIES

Press Clipping

Mobile Data Demand Will Expand Market for TDD, Says ZTE Head
September 29, 2010 Source: Leading industry magazine Global Telecoms Business (September/October 2010 issue)

he new president and CEO of ZTE is enthusiastic about the future of Chinas home-grown version of 3G mobile technologyand its LTE upgradeas a way of tackling the huge strain that data services are putting on mobile networks. Shi Lirong, the 46-year-old telecommunications engineer who took over at the top of ZTE at the end of March 2010, believes that many of the 500 operators that already have time-division duplex spectrum will consider migrating to the TD version of LTE. The technology can bring new value to operators, says Shi, in an exclusive interview with Global Telecoms Business. TDD spectrum is valuable and the TDD spectrum is cheaper, he adds. Some operators are already deploying the more usual frequency-division duplex version of 3G and then LTE, but, says Shi, because of spectrum limitations they are considering TDD spectrum for their data services. China Mobile pioneered TD SCDMA, a TDD version of 3G technology that was invented in China. When Chinese telecoms operators were reorganized in 2008, each of the three companies was allocated a different 3G technology: China Unicom got conventional WCDMA, as used in most of the world. The Chinese government told China

Shi Lirong: innovative software-defined radio is a unified platform for 2G, 3G and 4G LTE

October 2010

ZTE TECHNOLOGIES

Press Clipping

Telecom to use the Qualcomm version of 3G, and China Mobilethe biggest operator in the worldwas allocated TD SCDMA. There was some cost to China Mobile, as the then CEO, Wang J i a n z h o u , t o l d G l o b a l Te l e c o m s Business in 2009: TD SCDMA did not have the volume advantages that would drive cost down. But the sense of the industry appears to be shifting in favour of TDD, as customers around the world start to use mobile broadband at levels few ever expected. And the attraction of TDD is that it is efficient for data, which tends to flow unequally upstream and downstream. The system can dynamically adjust the timeslots for each direction, freeing space for other users. There are lots of new opportunities with TDD, says Shi, who was in charge of ZTEs sales and business development operations for 11 years until his promotion earlier this year. He started out as an engineer, with a masters degree in telecommunication and electronic system engineering a s w e l l a s a m a s t e r s d e g r e e i n engineering.

Focused on Innovation

Is it engineering that excites him, or the prospects of sales for ZTE? Both, it seems. We are more innovation focused: we can bring propositions to our partner operators, he says, neatly straddling both. Our innovation is oriented to market needs and oriented to the needs of our customers, he says. We believe in the future if ZTE wants to lead the telecoms industry. This strategy is the number one priority. But he swiftly moves on to his second priority for his leadership of

the company: market share. Currently more and more operators know that ZTE has good technology and good total cost of ownership, and we can deliver, he says. The company can execute on the projects on which it works, he says. We have very competitive products now, so we hope we can grow more market share. This is the result of high spending on research and development, he says: consistently about 10% of turnover. Revenue was $4.5 billion in the six months ending June 30 2010, according to the companys results published in August, and was increasing by more than 10% a year. Profit in the first half was $129 million, a rise of 12% year on year. That means that annual spending on R&D is getting close to $1 billion. We have a huge R&D investment, says Shi. We can develop lots of innovative products. About 10% of that R&D spend is on forward-looking research, he noteson projects such as next generation basestations and network. ZTE has a patent portfolio of over 30,000 patents in China and 4,100 patents overseas, covering 2G, 3G and 4G, including what it says are essential patents in LTE and UMTS. In 2009, ZTE says it ranked number one in patent applications in China, and it tripled the number of international patent applications. One result of this investment has been the companys software-defined radio equipment, says Shi. This is a system that allows an operator to hedge its bets on when demand for 3G will start to overtake the need for 2G base stationsand when, in turn, it will need to ramp up 4G services. The answer, according to ZTE, is to install a single standard of

hardware and put the difference in the software.

Software-Defined Radio

Its a unified platform for 2G, 3G and 4G LTE, he says. We are the first company to develop and deliver this software-defined radio equipment. CSL, Telstras mobile business in Hong Kongconveniently just a few kilometres from ZTEs headquarters in Shenzhen in southern Chinais an enthusiastic user of the vendors SDR, but there are others, says Shi, listing South African operator Cell-C, Portugals Sonaecom and KPN of the Netherlands. SDR is even more flexible than just providing the ability to move through the GSM family of technologies. We can even combine CDMA, WiMAX and TD-SCDMA in the same platform, smiles Shi. So, if a WiMAX operator wanted to do so, it could consider a move to the TDD version of 3Gan intriguing possibility. The company makes WiMAX systems, which are also TDD: it has, for example, supplied Telefnica with equipment for one of the first WiMAX networks in Spain. More and more people are considering the TDD spectrum, as FDD can be very limited and expensive, says Shi. With more data focus and broadband focus, operators need more spectrum resources, so people are considering TDD for wireless broadband. When the reorganization of Chinas telecoms operators was completed in 2008, it had taken a long time to sort out, leaving all three some way to catch up with the rest of the world in 3G operations. But that meant they all invested heavily and quickly in 3G and ZTE was a huge beneficiary.

ZTE TECHNOLOGIES

October 2010

Volume Advantage

The smartphone is still priced too highly. People are asking what will be next after Apple. I think ZTE can provide this.

We got the number one market position in Chinese 3G, mainly because ZTE is more competitive in technology and total cost of ownership, says Shi. It is competing in China with all four of its international rivals: Huawei is Chinese; Alcatel-Lucent has its own Chinese subsidiary, Shanghai Bell; and both Ericsson and Nokia Siemens Networks have a significant presence in China. There are five vendors and all five vendors compete, says Shi. But ZTE claims to have won the five-way battle in terms of market share. The three operators all assessed the network quality and ZTEs performance is the best with the three operators, he says. Best on what basis? For example , China Unicom calculates factors such as power consumption and so on.

This success in the first 3G investment phase gave us a volume advantage and therefore we became more cost effective and more experienced in 3G, he adds. So we will get more chances in the second phase and the third phase. Thats given ZTE a good market share in its homeland, and no doubt helped with volume efficiencies worldwide. In Asia Pacific our market share is high, says Shi. And he has his eye on other parts of the world: I hope in the near future in big countries Brazil, Russia, South Africa, Nigeria we will get higher market share. In the developed world, ZTE has had a number of successes, but its probably fair to say that the company has not achieved the same sort of market share as it has in the Asia Pacific region and other emerging markets. In Europe and North America there is big potential, Shi accepts. Politics possibly plays a part. Both ZTE and its Chinese rival Huawei and they are fierce rivalshave had political opposition in the US, but Shi is quick to respond that ZTE is a public company, with shares quoted on two stock exchanges. We are a listed company, not only in Shenzhen but also in the Hong Kong region, he says. Everything is very strict, as we follow Hong Kong regulations. Its more transparent and more regulated. Around 21% of ZTEs shares are foreign owned, he adds, and in 2010 the company appointed an American as an independent board member. This is Timothy Seifert, a former Freshfields lawyer who is general counsel of Alibaba, a Chinese online trading company. We are quite confident that ZTE is a very different Chinese

October 2010

ZTE TECHNOLOGIES

Press Clipping

company, says Shi. China has also changed, like ZTE has changed from a small company to a big company. Our thinking has also changedthats very important, he adds. So in the US, ZTE has started slowly. The ZTE corporate motto is step by step, he notesthough a more formal corporate slogan is bringing you closer. It has started its approach in the US with handsets and terminals. It was two years hard work, he notes, but that was the right strategy, which appears to have paid off. Now the main operators are choosing ZTE for the devices, he says. We have delivered handsets to Verizon. In the longer term ZTEs ambition is to provide an affordable smartphone, says Shi. The smartphone is still priced too highly. People are asking what will be next after Apple. I think ZTE can provide this. But meanwhile the next step in the step by step approach to the US market is to approach the networks, he continues. We have some successful middle and small operators. Next step, we hope we can get into tier one operators.

Tier One Customers

Tier one is the clear goal. Our strategy is focused on the big countries and the big operators, multinational operators like MTN, Bharti, Vodafone, France Telecom, he says. We are more focused on those operators. The company is very careful when dealing with smaller operators and, he added, in India we are very careful because there will be consolidation. There are many operators fighting for market share in India.

ZTE doesnt completely avoid small companies, though. In June 2010 the company signed a deal with a small Canadian start-up operator, Public Mobile, to design, build and operate an end-to-end CDMA network which includes wireless, core network, service platforms and IP architecture. ZTE will also deploy over 1,000 base stations for the network. That deal, said at the time to be worth $350 million, was funded by the Export-Import Bank of China. When you provide the equipment and the technical solution, sometimes we provide a package of financial facilities, says Shi. This can bring value for operators. We have lots of different financial partnersChinese and European banks. A financial package is not standard, but sometimes we can provide a package if the operator needs it, he notes. Customers also have their own channels for finance and they evaluate the financial costs, but if we can provide this we like to do so. Its an option for our operators. He adds: We are a listed company and we have very strict regulations on risk control. The design, build and operate part of that Canadian contract is intriguing too. Managed services are a very important strategy for ZTE, says Shi. We dont announce very much about it, but we have already provided services in many countries. The company has 2,000 people providing managed services in different countries over the last three or four years, he adds. We employ some very professional people. Shi lists MTS in Indiathe joint venture between Shyam of India and Sistema of Russiaas well as another Indian company, Idea Cellular, and Cell-C in South Africa as managed

services customers. We believe we can see a very high potential in this area, with more and more networks, adds Shi. Z T E s c o n t r a c t s a r e m a i n l y greenfield, where we have built the network, but some we take over, along with the existing operational staff, he notes.

Management Efficiency

Meanwhile, ZTE is as focused as most other vendors on trimming costs. The company wants to optimize our internal management, he says: Cost saving is also very important. He means internal cost saving, by optimizing its structure. ZTE has to reorganize our structure to be more flat and more effective. That means he will be setting clear goals for different departments in the company, and assessing their performance. He wants to save money on travel by making more use of IT and telecoms. Globally we have 400-500 videoconference terminals. We dont need to travel. Where next? The bringing you closer slogan Shi mentioned earlier is intended to reflect ZTEs corporate high concern for humanity, the companys global vision and insight, the value of dedication to the development of the communications industry. Top issues include corporate social responsibility, green technology, carbon reduction, solar powered handsets and green technology for our customers, says Shi. We need to bring ZTE propositions to the operators, to the people, to the community. Thats very important. With R&D, technology, products, service, we hope we can contribute to the community. Thats very important.

ZTE TECHNOLOGIES

October 2010

Focus

Building Profitable Bearer Networks

By Han Lijin and Chen Jianye

s networks converge and mobile Internet, Internet of Things, and Cloud Computing become prominent, bearer networks will need to be capable of high bandwidth, QoS, expansibility, and reliability. In the face of growing competition, network operators must reduce bit cost, realize efficient and reliable transfer of packet services, improve user satisfaction with broadband services, create new services and rapidly deploy them, and construct low-cost TCO bearer networks to recover costs. These are the considerations when constructing a bearer network. Low TCO, high benefits, and sustainable development are particularly important in network construction. With this in mind, ZTE foresees seven development trends for bearer networks.

October 2010

ZTE TECHNOLOGIES

Focus

ZTE adopts the latest technical standards to accommodate the seven development trends of bearer networks, and to coincide with the focal points of operators constructing networks.

The company senses the pulse of full service operation, and is dedicated to providing end-to-end network solutions.

Development Trends of Bearer Networks

Development trends in bearer networks include flat structure, convergence, broadband, packet transport, optimized operation and management, evolution towards IPv6, and energy efficiency. Flat structure Flat network structure implies a s i m p l i f i e d n e t w o r k h i e r a r c h y, converged control layer, and unified OAM. Construction costsincluding costs for transfer interfaces between equipment layers, and investment in machine rooms, transport, and power suppliesare lowered, as are maintenance costs. A flat network structure also reduces the risk of network failure so that user satisfaction is guaranteed. Convergence A converged network comprises unified backbone network technology a n d c o n v e rg e d s e r v i c e g a t e w a y. In the backbone forwarding layer, converged IP and optical transport layer technology is the development

direction; in the backbone control layer, Generalized Multi-Protocol Label Switching (GMPLS) technology with converged data and optical transmission is the development direction (because network resource use and distribution is optimized). Service gateway convergence implies the convergence of Service Router and Broadband Remote Access Router (SR+BRAS) in a fixed-line environment, and convergence of SR, BRAS and xGW (SR+BRAS+xGW) in a full-service environment. This effectively cuts down network TCO. Broadband Market competition, service expansion, and technological advancement drive the development of broadband bearer networks. Operators agree that bearer networks must have high bandwidth. Service expansion has mostly been driven by wireless Internet services and fixed video services; and as a result, bandwidth demands for fixed and wireless networks have grown rapidly. Bearer networks with higher bandwidth therefore need to be constructed for operators to become much more competitive. Technological advancement depends on the progress of microelectronic technology, the improved capacity of optical transmission equipment, and the

rapid development of broadband access technology. Packet transport A broad technical consensus has been reached that telecom services should be IP based. Traditional fixed telephony is evolving to VoIP, and mobile networks are also evolving to all-IP. With the trend toward packet services, packet transport networks with packet interfaces and packet cores are inevitable. The packet interfaces must support not only traditional E1/STM-N interfaces but also FE/ GE/10GE/40GE/100G interfaces, and the network core must adopt a packet design to utilize bandwidth efficiently and to better support various packet characteristics. Optimized operation and management Optimized operation and intelligent management improves network profitability, and helps in situations where profits are falling or growth in the user base has slowed. Intelligent management involves using a unified network management system for rapid service deployment, centralized performance monitoring, and accurate fault locating. Optimized operation aims at offering differentiated services through service segmentation and real-

ZTE TECHNOLOGIES

October 2010

Access
Telecom Plane
VIP RNC

MAN
PE BMSG CDN CDN P

Backbone
P

Service
DHCP/ BSS/ DNS NMS AAA OSS OAM ISPB

IGW

CTN6000
Base station

PTN

CTN9000 T1200/M6000 ZXR10 5900

SW/OLT SW/OLT

CR/P

ISPA

ZXR10 T8000
MAN

PE Internet MGCF/IM-MGW SBC CSCF IMS

HG SW/ONU

ZXR10 T8000 ZXR10 8900 ZXMP M720

OTN

ASBR

ASBR

FTTB/C

Public Plane

IPTV OTN OTN/WDM

ZXMP M820 ZXONE 8000

ZXMP M920 ZXONE 8000

IDC

GGSN

Figure 1. ZTEs end-to-end bearer network solution.

time network resource control so that quality value-added services can be provided. Evolution towards IPv6 As the Internet expands and demand for IP addresses by new services such as the Internet of Things grows, the number of available IPv4 addresses is rapidly decreasing. An address bottleneck will therefore ensue, and the need to introduce IPv6 is pressing. The IPv6 industrial chain is nearing perfection after several years development, and IPv6 network equipment is now coming into commercial use. The era of widespread commercial use of IPv6 is fast approaching. Energy efficiency Energy conservation, emissions reduction, and environmental protection have become strategic goals of most countries around the world. With such high energy consumption, the communications industry recognizes

that environmental awareness must be a core value. Domestic and international operators have set targets for energy saving and emissions reduction. This protects the environment, cuts costs for the operator, and strengthens commercial competitiveness.

A Profitable End-to-End Network Solution

ZTE adopts the latest technical standards to accommodate the seven development trends of bearer networks, and to coincide with the focal points of operators constructing networks. ZTEs end-to-end bearer network is the solution to building a profitable network. As shown in Figure 1, CTN9000/6000 is deployed in the access and aggregation layers of telecom planewhich adopts 1588v2/G.8261 high-precision clock synchronization and MPLSTP technologies to create a packet transport network. ZXR10 8900 carrierclass series switches are employed in the aggregation layer of public plane

to realize convergence. ZXMP M720 (OTN equipment) should also be deployed in the MAN layer to save fiber resources. In the service control layer, an advanced converged gateway M6000/T1200 improves reliability of the network by introducing highly reliable backup technology. In the MAN backbone layer, a flat broadband network is constructed using ZXWM M920 (40G/100G high-capacity OTN equipment) and ZXR10 T8000 (high-end cluster router support 16+64 chassis cascade). In terms of network operation and management, the NetNumen platform is used for quick end-to-end service deployment, and GMPLS technology is used for convergence of support networks in the control plane of the bearer network. IPv6 is also used for smooth evolution to NGN. ZTE seeks to work with operators to build profitable and evolvable bearer networks through sound solutions, quality equipment, and first-class service.

October 2010

ZTE TECHNOLOGIES

Focus

Cluster Routers:
By Zhu Haidong

The Best Choice for Future-Oriented Backbone Networks

t took only ten years to increase the interface rate of a router from 2.5Gbps to 10Gbps, 40Gbps and even 100Gbps. Changes in the Internet have proceeded rapidly and have gone well beyond what could have been imagined. The Internet has developed from a simple data carrier to a central part of the information infrastructure of whole societies. And the IP backbone network, a pillar of the Internet, is now required to bear an increasing amount of data traffic. As the growth of IP services continues to boom, data within the backbone network becomes more c o m p l e x . I P T V, Vo D , a n d P 2 P traffic places greater demands on the scalability and reliability of the network. Reliability and self-healing To d a y s I n t e r n e t c o m p r i s e s a countless number of operator nodes. The stability of operator backbone networks not only influences the networks and services run by operators

themselves, but also the entire Internet. Considering the vast ocean of data exchanged over the Internet in real time, even a small failure can result in multi-million dollar losses. Therefore, IP backbone networks must be self-healing, highly reliable, and capable of automated troubleshooting and recovery in the event of sudden abnormality. Such networks must also guarantee availability under normal operation. Scalability and growth The IP backbone network is a scalable network. Internet traffic doubles every 12 months, with IP traffic growing exponentially. With the rise of mobile broadband access, video and interactive services, and new network services, the growth of traffic carried over the IP backbone network is expected to accelerate rapidly. Backbone networks must therefore have excellent scalability to counter the skyrocketing amount of data. If scalability is not addressed,

investors will not be able to transform their existing commercial networks to suit their business growth, and in full accordance with an ideal network structure plan. Additional nodes will add complexity to a clear and neat network, which in turn will impact service support and network maintenance. Nodes should guarantee reliable continuation of services under a non-optimal network structure, and provide more flexible, intelligent service control capabilities. Such requirements are part of the growth of a network. Full-service bearer The IP backbone network is also a converged network that bears many kinds of services. Today, almost all services are based on TCP/IP, and all applications can be provided on a uniform network. Bearer networks are converged at all layers, and the IP backbone network is the starting point on the path to convergence. By rapidly responding to market

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demands, ZTE has introduced the ZXR10 T8000 carrier-class router which is designed to meet current and future service needs. It supports 16+64 chassis cascade, and is suitable as the Internet core node, backbone network super node, and egress of a large MAN. ZXR10 T8000 is an ideal choice for operators aiming to build a flat network and looking toward the long term evolution of their uniform bearer network. Multi-level assurance To ensure the backbone network is reliable, ZXR10 T8000 provides technical assurance in three aspects. It applies Non Stop Routing (NSR), hot patching, and In-Service Component Upgrade (ISCU) technologies for dynamic loading of functions. Using active/standby switching of inter-frame logical entities, a single router and a cluster of routers can be expanded smoothly without causing interruption to running services. For the numerous routing table entries and complicated forwarding relations in a backbone network, ZXR10 T8000 adopts distributed processing, routing filtering, and protection mechanisms to rapidly screen failed nodes. This eliminates routing instability and maintains stable forwarding relations between the nodes. ZXR10 T8000 also assures reliability at five levelssystem architecture, equipment components, operating system, protocol processing, and message flowsto ensure steady operation with 99.999% availability. Ultra-large capacity cluster Scalability of an IP backbone network can be improved by increasing the capacity of a single device, changing the network structure with distributed network layers where multiple devices are deployed in one node, and placing multiple routers

NOC

2G/3G

Backbone

IPTV

IMS

NGN

EPC

Metro ISP Peer IDC

Figure 1. ZTEs IP network solution.

into a cluster. Clustering is a cheaper way of meeting demands of service growth, network performance, and capacity expansion without creating additional network complexity. ZXR10 T8000 supports multi-chassis cascade and linear capacity expansion. The switching capacity can reach up to 200Tbps. At present, the ZXR10 T8000 line card provides a 100Gbps wirespeed port at each slot that supports smooth upgrade to 400Gbps. Independent intellectual property rights ZTE owns independent intellectual property rights for ZXR10 T8000. Its ZXROS system is a modular multiprocess system. Using differentiated kernel and user mode, independent component process space, and full distributed processing, it enables the operating system to be open and reliable, and paves the way for multiservice bearing and control. After years of research and development, ZTE has made breakthroughs in top-class router

chipsets, and has built its own chip system that provides for continuous evolution of equipment and technology. Energy conservation By applying energy-saving technologies such as smart power supply, smart dormancy process, smart service adjustment, smart line-card startup, and smart fan control, ZXR10 T8000 is energy efficient and consumes 23% less power. Backed by a full product range, and drawing on years of network construction experience, ZTE can provide a total IP network solution with well-defined architecture, as shown in Figure 1. An IP backbone network employing ZXR10 carrier-class routers provides independent service access layers, differentiated SLA, and security assurance, thereby meeting the needs of operators. The reliability, scalability, and energy efficiency of such a network gives operators a distinct market advantage.

October 2010

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Focus

A Reconfigurable Gateway for the Coexistence of

PTN and MSTP

By Zhao Yue

Challenges for Operators

s 3G mobile services develop a n d d e p l o y m e n t o f LT E networks rapidly approaches, a next generation Packet Transport Network (PTN) technology is necessary for operators to reduce TCO and enhance the competitiveness of their mobile broadband networks. Since conventional SDH networks will coexist with IPbased networks for some time to come, smooth evolution from SDH to PTN is a key issue that needs addressing. Considering the long-term coexistence of 2G and 3G, the most simple way to capitalize on existing network infrastructure is to carry 2G voice services over SDH, and 3G and EOS services over PTN. To accommodate the expansion of 2G services, 2G BTSs must be built or EOS services swapped from SDH to PTN. When PTN is used to bear services at the new BTS side, there may not be any idle STM-1 interface at the BSC side for connection with PTN. As a result, services sent from BTS to BSC may not be transmitted through equipment at the PTN core layer, but rather through the original 10G/2.5G MSTP at the core layer. Because EOS services are transported over SDH, substantial bandwidth is

consumed. If these services are swapped to PTN, which is more suitable for data service bearing, more SDH bandwidth resource would be available for 2G services. To make full use of bandwidth resource in MSTP and to address the above networking issue, a PTN and MSTP hybrid networking solution (see Figure 1) is a good solution. The following issues must be considered: How to enable cross-domain traffic transfer between BTS and BSC How to provide cross-domain endto-end (BTS to BSC) protection How to realize cross-domain NMS interconnection between PTN and MSTP

How to convert OAM information between PTN and MSTP

Non End-to-End Interconnection Solution

PTN and SDH implement pseudowire decapsulation through the STM-1 or STM-4 interface and the original E1 signals are recovered for transmission. Because MSTP and PTN belong to two separate ringsPTN access ring and MSTP convergence ringthey perform intra-domain traffic scheduling respectively. Traffic from BTS to BSC is configured separately for network management. E1 to VC12 end-to-end traffic is configured for PTN, while VC12 to VC12 end-to-end traffic is
PTN MSTP

BSC

RNC

Optical Interconnection

Original MSTP Convergence Ring

PTN Convergence Ring

New PTN Convergence Ring

New NodeB

Original MSTP Access Ring

Original PTN Access Ring

New PTN Access Ring

BTS NodeB

NodeB NodeB NodeB New BTS New BTS

Figure 1. PTN and MSTP hybrid networking.

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October 2010

configured for MSTP. The MSTP and PTN rings are independently protected. A non end-to-end interconnection solution (see Figure 2) is easy to implement and deploy on the existing network. No alteration to existing PTN and MSTP is necessary. However, the solution has high risks in network topology. Single node failure may occur between the PTN access ring and MSTP convergence ring, and this may lead to service discontinuity between BTS and BSC. Moreover, the solution fails to provide end-to-end protection, endto-end OAM, or NMS interconnection b e t w e e n P T N a n d M S T P. A n y network failure entails layer-by-layer troubleshooting. This affects rapid fault locating, recovery, and QoS.

PTN

MSTP

BTS

RNC PTN Access/ Convergence Ring NSTM-1/4 MSTP Convergence/ Core Ring BSC

NodeB

Figure 2. Non-end-to-end interconnection.

Packet Access Domain MSTP Convergence Domain

SDH Gateway Card

C.STM-1 NE1 BTS NE1 FE NodeB OAM Interworking / Synchronization Information Exchange / Coordinating Protection Unified NMS PTN MSTP FE/GE RNC BSC

Active LSP Standby LSP

Figure 3. Reconfigurable gateway solution.

Reconfigurable Gateway Solution

ZTE has launched a reconfigurable gateway solution for interworking between a newly-built PTN and existing MSTP. The solution provides unified NMS, service and OAM information conversion, end-to-end protection, and clock synchronization. These help operators integrate existing resources and realize smooth evolution of networks (see Figure 3). In China Mobiles 2G/3G backhaul network, MSTP was first deployed at the convergence layer where there is redundant bandwidth. At the access layer, where bandwidth is scarce, a new PTN has to be built. To protect China Mobiles initial investment, ZTE supplied a reconfigurable SDH gateway for MSTP and PTN hybrid networking, which allowed the transfer of both 2G and 3G services. ZTEs reconfigurable gateway solution has advantages over a traditional tunnel solution: Low cost and easy deployment: The reconfigurable SDH gateway has

low-cost hardware that meets high technical requirements. It can be easily deployed with no change to MSTP topology and without impacting existing traffic. Cross-domain traffic transfer: PTN supports a reconfigurable SDH gateway. After PTN simulation, TDM traffic is converted into E1 signals, which are first transferred to PTN gateway nodes, then to MSTP through the STM-1/4 SDH interfaces, and finally to BSC. In this way, traffic encapsulation overhead is saved and bandwidth utilization is increased. End-to-end OAM: A reconfigurable SDH gateway makes it possible to convert PW alarms in the PTN domain into VC12 alarms in the MSTP domain, and vice versa. This helps implement end-to-end alarm management, and end-to-end OAM of network devices of different vendors. End-to-end protection: End-to-end protection can be realized through

SDH protection and PTN protection as well as interoperability of PW 1+1 protection and MSTP VC-12/VCG 1+1 protection. Cross-domain NMS interconnection: The interworking of Data Communication Network (DCN)PTNs NMSand Data Communication Channel (DCC) of MSTP allows fast fault locating and recovery. The reconfigurable gateway solution meets customer requirements for high performance, low cost, and low power consumption. It supports easy and flexible deployment in the newlybuilt PTN without impacting existing services, and provides reliable end-toend protection, rich OAM functions, fast troubleshooting, and convenient end-to-end management. Because EOS services are smoothly swapped to PTN, SDH bandwidth resources are saved for bearing 2G voice services, and this helps operators protect their investments in SDH.

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Focus

Promonte Leads with

By Li Lei

All-IP Transformation

We are very happy to establish this new partnership with ZTE and together build a future-proof network which will benefit both Promontes customers and the environment. Christopher Laska, Promonte CEO

ontenegro is located in southeastern Europe and has a coast on the Adriatic Sea. With its picturesque coast and a mountainous northern region, the country is a popular tourist destination. The Telenor Group, headquartered in Norway, is the sixth largest provider of telecommunications services worldwide, and its subsidiary, Promonte, is Montenegros largest mobile operator. Promonte is 100% owned by Telenor and its mobile subscriptions account for 50% of the population. As Montenegos tourism industry has developed, its mobile market has grown rapidly so that mobile penetration now exceeds 200%. Promontes networks were costly to maintain and did not support smooth upgrade to LTE, so the company decided to upgrade its existing network to grow and consolidate its market share. After a vigorous selection process by Telenor and Promonte, ZTE was chosen as the sole vendor for the upgrade of the 2G/3G network (with some sites being upgraded to LTE in 2013). ZTE supplied high performance IP Transport Network

(IPTN) products for construction of the bearer network. ZTEs new generation SDR base stations were installed to replace the original ones, and a plan was made to deliver LTE services by 2013. This represented an evolution of mobile services from TDM to allIP. Montenegro is a mountainous country, and microwave is the dominant technology for wireless base stations. Issues such as utilizing and boosting bearing efficiency, fast provision of new services, improving user satisfaction, and managing CAPEX and OPEX, required careful consideration to ensure long-term evolution of mobile network and to build an outstanding bearer network. With packet-based kernel, IPTN can carry packet services efficiently. Because Promonte holds ZTEs IPTN products and solutions in high regard, ZTE was chosen above all others to build the bearer network. One network to enable multi-service access: New base stations are all IP based. A number of E1 and STM-1 services, as well as services from

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other networks, are still carried by the existing network. ZTE provided a complete IPTN solution to cope with this situation. IP RAN was used for access and aggregation layers, to carry both Ethernet and TDM services. ZXCTN 9008 served as a PE node of the MPLS network for access to all services from RAN and the core side, while ensuring network security through node redundancy. Delivery of high-quality services in tourist season: Because Promonte employed microwave technology to build the original network, the maximum bandwidth of its three national backbone rings was only 600MB. IPTN can provide an IP-based networking mode and implement bandwidth multiplexing on the link, resulting in a higher utilization rate for microwave link. IPTN has a perfect QoS mechanism and can deliver differentiated services based on service class. This satisfies the requirement for highquality service delivery during the tourist season.

Reliability is the basis of network: IPTN features robust reliability, a complete OAM mechanism, and protection schemes such as PW dualhoming and tunnel protection, which provide end-to-end and hierarchical protection from service layer to link layer. High reliability, redundant critical board, and universal board design allow equipment to operate normally even in severe weather. Smooth evolution to LTE: IPTN supports bearer technologies such as IP RAN and Metro-E, and is capable of smooth evolution to LTE. Fast delivery: To guarantee network stability prior to the tourist season in summer, Promonte required network swap to be completed before April 2009. This involved collocation of nearly 300 2G/3G base stations and core network equipment. As the infrastructure network, the mobile bearer network had higher requirements. Prior to service swap, ZTE needed to complete installation and commissioning of transmission equipment at all nodes and ensure

they passed acceptance tests within three months. Many stations were located in the mountains where the terrain was difficult and the roads were icy during winter. Some stations on the mountaintop were only accessible by helicopter. Despite installation challenges caused by the environment, ZTE engineering staff braved the bitter cold to complete the installation and commissioning of the transmission equipment earlier than agreed. All items passed an acceptance test on the first attempt, and this gave a strong indication of success in subsequent service swap. ZTEs swift response was greatly appreciated by Promonte. The successful implementation of the Promonte project helped the company improve the quality of its mobile bearer network. It can now deliver muchimproved services to attract more customers, drive service growth, and consolidate its leading position in Montenegros mobile communications market. Montenegro is well on the road to an all-IP era.

October 2010

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Interview

Rooted in China: Stepping Forward

to World-Class Excellence
By Zhao Lili

An interview with Zeng Xuezhong, Senior Vice President of ZTE Corporation

&T/EXPO COMM CHINA 2010, to be held in Beijing this October, will be the most influential ICT event this year. The theme of the EXPO is tri-network convergence, and topics such as TD/LTE/4G evolution, green telecom, and Internet of Things will be discussed. In the lead up to the event, journalist Zhao Lili interviewed Zeng Xuezhong, Senior Vice President of ZTE Corporation, to find out how ZTE is working with Chinese operators to develop a new industrial chain in a new industrial environment. Journalist: 2009 saw the birth of 3G in China, and the countrys three major operators have been involved in 3G network deployment and operation ever since. What role has ZTE played in Chinas 3G deployment? And how will ZTE establish strategic partnerships with these operators to develop their networks to LTE? Zeng: In 2009, Chinas Ministry of Industry and Information Technology issued 3G licenses to China Mobile (TDSCDMA), China Unicom (WCDMA), and China Telecom (CDMA). This marked the formal entry of China into the 3G era, and for the first time, placed Chinese telecom vendors on an even footing with foreign competitors. ZTE is not only a key participant in Chinas 3G network construction, but also an advocate for 3G

Zeng Xuezhong has been Senior Vice President of ZTE since 2006. He graduated from Tsinghua University with a bachelors degree in engineering in 1996, and with an EMBA in 2007. Mr. Zeng joined Zhongxingxin in 1996. Between 1997 and 2006, he acted as Senior Project Manager, Assistant to the Regional General Manager, Manager of Guiyang and Kunming Branches, Deputy General Manager and General Manager of the Second Sales Division, and Vice President of ZTE. Since August 2006, he has been Senior Vice President of ZTE overseeing the Third Sales Division. Mr. Zeng has many years experience in the telecom industry, including more than 10 in managerial positions.

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industry development and technological innovation. According to a report released by iSuppli in January 2010, ZTE holds the largest share in Chinas 3G market. In the TD-SCDMA sector, ZTE has been a strategic partner of China Mobile throughout its TD network constructionfrom the phase one and two network trials in 2007 and 2008 to the large-scale phase three commercialization in 2009. ZTE has played a key role in China Mobiles technical innovation, industrialization, network deployment, and service delivery. ZTE has also become the industry leader in CDMA, holding the largest market share in China since 2007. Close cooperation was established with China Telecom after it was awarded a CDMA license, and ZTE infrastructure equipment has now been deployed in 27 provinces throughout the country. ZTE helped China Telecom build approximately 60% of its local CDMA networks at the prefecture level, and undertook most of its 3G network planning, construction, and maintenance. ZTE has also been a key supplier to China Unicom since the company started WCDMA network deployment in 2009. ZTEs market share increased during phase two, phase three, and phase four of China Unicoms WCDMA project. The largest share was clinched in phase four of the project, which covered 20 provinces and 108 cities. Leveraging its implementation efficiency and service capability, ZTE became the leader in fast project completion. Moreover, network tests were passed with excellent results. All this demonstrates ZTEs comprehensive strength in the WCDMA field. Operators worldwide are closely

monitoring the evolution of 3G to LTE, and some are even initiating the process. ZTE is devoted to LTE research and development, and is continually increasing its strategic funding in both FDD and TDD. We have applied for more than 1,700 LTE patents, and own basic patents of the LTE standard. With a quality product portfolio and a growth strategy that is prudent and sustainable, ZTE is ranked among the Top 3 players in terms of LTE strength by research firm Garnet. ZTE offers sophisticated services for TD-SCDMA, CDMA2000, and WCDMA, working with operators to develop the whole industrial chain. We are highly recognized by operators for our innovation mechanism, long-term strategies, and enhanced brand image. Chinese telecom vendors are certainly capable of competing with global telecom giants. The 3G era is a turning point for Chinas telecom industry and is of far-reaching significance. J: The theme of P&T/EXPO COMM CHINA 2010 is tri-network convergence, and the Chinese government has put in place support policies to speed up this process. What changes will happen in Chinas telecom industry, and what challenges and opportunities will this present to equipment vendors? Zeng: In January 2010, the State Council passed a general proposal for speeding up the convergence of telecommunications, broadcast TV, and Internet networks. This proposal will alter the whole industry, not only driving the growth of telecommunications, broadcast TV, and Internet businesses in China, but also presenting opportunities and challenges to all parties in the industrial chain. Tri-network convergence will

change the competition pattern of Chinas telecommunications industry. For equipment vendors, it will lead to increasing demands for equipment because of network construction and upgrade requirements. More importantly, as telecom operators transform into service providers, equipment vendors will also transform from simple equipment suppliers to end-to-end full-service solution providers. The group of three major operators in China will expand to include CATV operators. These new operators will have diversified business models and will challenge traditional operators with their control over TV content and broadcasting rights. Both telecom and CATV operators will have to innovate and explore new areas of business to gain a competitive advantage, and this will create new market and cooperative opportunities. Demand for triple play services will g r o w, a n d e m e rg i n g m u l t i m e d i a services such as position shift TV (PSTV), interactive TV, high definition video, mobile monitoring, and mobile TV, will be widely sought after. Moreover, with the current bandwidth restrictions for broadband services, telecom operators will be compelled to increase network access bandwidth and to widely deploy FTTH networks. Likewise, because cable networks are incapable of bidirectional transmission, CATV operators will be compelled to restructure their networks as digital two-way systems. Changes brought about by trinetwork convergence will present opportunities and challenges for equipment vendors, but the opportunities are greater than the challenges. The entire industrial chain will be reshuffled. Infrastructure equipment vendors, service equipment

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Interview

vendors, OSS providers, high-end integrated terminal suppliers, and content and service providers will become the markets focus of attention. With the most complete range of infrastructure, service, OSS, and terminal equipment, ZTE has much experience in integrated broadcasting and control platforms, interactive and converged services, transmission, IP, fixed-line networks, and service software. Drawing on the advantages of our products and end-to-end network solutions, ZTE will continue to be a key player in tri-network convergence, and will further improve its ability to rapidly respond to operator needs. J: Green technology, carbon reduction, a n d e n e rg y c o n s e r v a t i o n a r e o f

paramount importance in todays telecommunications industry. What requirements are implied by these issues and how will equipment vendors and operators adapt to such requirements? Specifically, what is ZTE doing to minimize negative environmental impact? Zeng: Green products, carbon reduction, and energy conservation are now integrally linked to the sustainable development of telecom enterprises, and represent a revolution in values, concepts, production modes, and lifestyles. In a recent government work report, Premier Wen Jiabao stated that the global financial crisis was giving rise to a technological and industrial revolution, and that great efforts should be made in developing emerging

strategic industries including new energies, new materials, information networks, and high-end manufacturing. The ICT industry is vitally important in promoting a low-carbon economy. Telecom vendors and operators must play an active role in a new low-carbon economy, and are obliged to promote healthier, more sustainable telecom models. To create green, innovative networks, and to drive sustainable development across the industry, ZTE has incorporated energy conservation and environmental protection into its technological innovation, product R&D, and manufacturing. We have been active in drafting international standards, and have established a complete green operation and evaluation system

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power consumption of base stations implies limiting the use of auxiliary devices associated with power supply, cooling, and maintenance. When combined with new energy resources such as solar or wind, power savings of around 50% are achievable. These efforts are examples of how ZTE is developing green, low-carbon, and energy-saving products. J: Driven by new service demands, new business models and new technologies such as Cloud Computing, Internet of Things, and mobile Internet have emerged and are being enthusiastically promoted within the industry. How will vendors and operators change their supply and demand relationships to cope with new forms of competition? Z e n g : T h e e m e rg e n c e o f C l o u d Computing, Internet of Things, and mobile Internet has driven operator demands for new products, industrial convergence, and business innovation. Increasingly, equipment vendors are being asked to not only provide upgrade solutions for products and platforms, but also to develop new products. They must meet network requirements in a new industrial environment. Today, the telecom industry is converging with IT, entertainment, Internet, and even traditional logistics, and this trend inevitably presents challenges and opportunities to all parties in the industrial chain. Traditional telecom enterprises, however, may have little knowledge of other fields. Providing operators with new products and technologies is not the only role played by telecom vendors; they must also work with operators to explore future technological trends, network development, and business models. As well as helping operators increase

efficiency and profitability, vendors will become long-term strategic partners in the joint exploration of new market opportunities. With the widespread deployment of 3G networks throughout China, operators have transformed into fullservice providers. 3G service operation has become a primary focus, and mobile Internet strategies have been put forth. Since the first half of 2009, ZTE has been helping China Telecom build its software stores and this year won a project to build China Unicoms software store. ZTE is working hard to enhance its service innovation, and is partnering with operators to offer high quality feature-rich 3G services. J: Finally, what are the future plans of ZTE in China? Zeng: China is a very important market for ZTE. In the coming years, we intend to continue helping domestic operators explore opportunities and to maintain our own high speed growth. Drawing on our strength in integrated solutions, quality project delivery, and technological innovation, we will cooperate with our partners to satisfy requirements for mobile broadband, to thoroughly enhance service quality, and to contribute to the countrys industrialization and information building. On the whole, ZTE will enhance its ability to deliver integrated solutions and resources, and will seek to improve its competitive strategies, product planning and deployment, and market behaviors to provide operators with a full range of products and services. Although rooted in China, ZTE is stepping forward to worldclass excellence by further improving operational efficiency and developing its global strategy.

incorporating product research, implementation, supervision, and management. Environmental protection is at the forefront of our product design, testing, and manufacturing, and this helps reduce TCO while i m p r o v i n g p r o f i t a b i l i t y. G r e e n packing, transportation, installation, and operation and maintenance are implemented as part of our logistics and project delivery. Moreover, we provide unified all-IP platforms, IMS core networks, IP service engines, multi-mode BSCs, and renewable energy sources for network evolution and convergence. Power consumption of base stations can be reduced by 30% or more over a 24 hour period, which translates into savings of up to 6,300kWh per site each year. Reducing

October 2010

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Third Eye

Future-Oriented IP Services Boost Operators Ability for Service Delivery

August 9, 2010, selected from the global-growth consulting firm Frost & Sullivan

ptical network is the backbone of the entire telecom network. Wi t h t h e a d v a n c e m e n t of optical component and silicon technologies, optical network is witnessing a shift from single pointto-point topology to ring and mesh topologies, accompanied by increased automation of equipment.

Large-Capacity ODUk Digital Cross Connection

In April 2010, ZTE launched ZXONE 8000 series, a large-capacity digital cross-connect equipment, to cope with the requirements of bandwidth and large-granule service grooming in metro network. The equipment can help operators build intelligent and flexible transport grooming network at IP granularity, thus adapting to future metro networks. ZXONE 8000 can perform highspeed and intelligent grooming of services at granularities of ODU0/1/2/3 and provide OTN digital cross-connect capacities ranging from 800Gb to 1.6Tb and 3.2Tb. It implements non-blocking digital cross connection at granularities of ODU0/1/2/3. Frost & Sullivan states that ZXONE 8000 has reliable system architecture. Its cross-connect unit

employs advanced N:M protection mode to identify cube-level failure rate, resulting in much higher equipment security compared to traditional N+N protection mode with square-level failure rate. ZXONE 8000s other salient features include: flexible access of varieties of services like STM-1/4/16/64/256, POS, GE/10GE/ 40GE, OTU1/2/3, DVB, ESCON, FC-N (N=1, 2, 4, 8, 10); dual-plane intelligent control via loading WSON to accelerate service provisioning; multiple restoration paths for critical services to enhance service survivability and boost network utilization, analyzed Fox Hu, consulting manager of ICT practice, Frost & Sullivan.

Greener and Simpler

Wi t h t h e v a s t l y i n c r e a s e d investment on 3G services, operators will come under increasing pressure to drive down network investment cost and improve ROI, cited Cheney Ji, consultant of ICT practice, Frost & Sullivan. Green network results in lower operational cost. ZXONE 8000 can be deployed in core layer optical network. It recorded power consumption of 34.650W and 27.455W per 10G

bandwidth respectively under separate tributary and line mode and transponder mode. The service processing system enables full utilization of bandwidth reducing network construction and operational cost. Intelligent service control helps to lower maintenance cost. By integrating GMPLS control plane to the network, ZXONE 8000s service processing system (ROAMD and digital crossconnect system) can implement highly intelligent service operation. Operators can perform hierarchical QoS management, implement networklevel service restoration and balance link load; making the network more intelligent and easier in service control and maintenance. As a result, the network operation and maintenance cost can be reduced. According to Frost & Sullivan, core layer optical transport network market has high technical barrier. ZTE is expected to succeed in gaining access to this high-end optical network equipment market with ZXONE 8000. Its outstanding system architecture and performance can help operators build high-performance and large-scale intelligent optical transport network, accommodating development of future metro networks.

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Research Note

LTE-A
By Mi Dezhong

Leads Future Wireless Communications

or its high speed and low latency, LTE has attracted much attention from leading telecom operators and equipment vendors worldwide. Operators are now increasing their LTE investments, and are actively engaged in LTE testing. Commercial LTE networks have been available since 2010. To ensure longterm evolution and compliance with IMT-Advanced (IMT-A) specifications, 3GPP has initiated research into LTEAdvanced (LTE-A) and has adopted it as the preferred 4G candidate. LTE-Asmoothly evolved from

LTEboasts higher peak data rates (1Gbps in the downlink and 500Mbps in the uplink), and higher spectral efficiency (30bit/s/Hz in the downlink and 15bit/s/Hz in the uplink). It supports various deployment scenarios, enabling seamless coverage from macro cells to indoor areas.

Coordinated Multi-Point Tx/Rx (CoMP). Carrier aggregation To reach the required peak rates, LTE-A supports a maximum bandwidth of 100MHz. Such high bandwidth is hard to find in the available spectrum resource, and also poses a great challenge to hardware design of eNodeB and User Equipment (UE). Moreover, a key technique is needed to fully utilize spectrum scattered on various frequency bands. To meet these requirements, CA has been introduced

Key Techniques for LTE-A

A number of new technologies have been introduced into LTE-A to meet IMT-A requirements. These key techniques include Carrier Aggregation (CA), enhanced MIMO, relay, and

October 2010

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Research Note

into LTE-A. CA supports both continuous and non-continuous Component Carrier (CC), as shown in Figure 1. This not only improves peak data rates and system throughput, but also addresses the issue of spectrum discontinuity. Asymmetric carrier aggregation is also supported in LTE-A. In a typical scenario of asymmetric carrier aggregation, downlink bandwidth is larger than uplink bandwidth. To allow compatibility with LTE, LTE-A Rel-10 specifies that each CC adopts existing LTE bandwidth and is backward compatible with LTE. In LTE-A Rel-11 or above, other nonbackward compatible carriers will be introduced. In practical scenarios for carrier aggregation, one or more CCs can be scheduled per UE depending on the transmission requirement and capability. Enhanced MIMO Multi-antenna technology improves channel capacity and spectral efficiency by expanding transmission dimension. In LTE-A, more antennas are supported in the uplink and downlink, and MultiUser Multi-Input Multi-Output (MUMIMO) is enhanced in the downlink, as shown in Figure 2. Compared with LTE Rel-8 (which supports single-antenna transmission), in the uplink, LTE-A supports up to four transmit antennas. For the Physical Uplink Shared Channel (PUSCH), up to two codewords and four layers are supported with Single-User MultiInput Multi-Output (SU-MIMO). For the Physical Uplink Control Channel (PUCCH), transmission quality is improved through transmit diversity. In the downlink, the number of transmit antennas is expanded from four to eight, and up to two codewords

and eight layers are supported. This greatly improves downlink transmission throughput and spectrum efficiency. Moreover, dynamic switching of SUMIMO and MU-MIMO is supported, and performance of downlink MUMIMO is optimized through enhanced feedback of Channel State Information (CSI) and a new codebook design. Relay In relay transmission, a relay node or relay station is introduced between eNodeB and UE. The relay node is connected to eNodeB via a wireless link. In the downlink, data is transmitted from eNodeB to relay node,

and then to the end user, while in the uplink, data is transmitted from the end user to relay node, and then to eNodeB, as shown in Figure 3. In LTE-A, relay is used as a tool to improve highdata-rate coverage, to support group mobility and temporary network deployment, and to enhance cell-edge throughput. Relay falls into two categories: type 1 and type 2. Type 1 relay has an independent cell ID, and provides resource scheduling and hybrid automatic retransmission functions. For an LTE Rel-8 UE, type 1 relay works as an eNodeB; however for an LTE-A UE, type 1 relay has more powerful

LTE CC1

LTE CC2

LTE CC3

LTE CC1

LTE CC3

LTE-A carrier

LTE-A carrier

LTE-A carrier

Continuous CA Figure 1. Typical scenario of carrier aggregation.

Non-continuous CA

Downlink
Support up to 8x8 antenna configuration Support dynamic SU-MU MIMO switching Enhanced MU-MIMO feedback

Uplink
Support up to 4x4 antenna configuration PUSCH supports SU-MIMO PUCCH supports transmit diversity

Figure 2. Enhanced multi-antenna solution.

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UE

preprocesses channel state information under certain assumptions, and feeds back information such as precoding matrix indicator and channel quality indicator to eNodeB. For SRS-based feedback, eNodeB uses channel reciprocity and obtains equivalent downlink channel state information according to the SRS sent by UE. This scheme is suitable for a TDD system.
eNodeB

Prospects of LTE-A
Relay Node

UE

Figure 3. Principle of relay transmission.

JP

CS/CB

Figure 4. Principle of CoMP.

functions than an eNodeB. Type 2 relay has no independent cell ID, and no control information except traffic is transmitted. Type 1 relay is now adopted in LTE-A Rel-10. CoMP In LTE-A, CoMP is considered a useful tool for improving high-data-rate coverage, cell-edge throughput, and system throughput in both heavy and light load scenarios. CoMP involves uplink CoMP reception and downlink CoMP transmission. Uplink CoMP reception improves cell-edge user throughput by joint multi-cell reception of user data, and this has very limited impact on RAN1 specifications. Depending on whether traffic data is obtained

at multiple coordinated points or not, downlink CoMP transmission is divided into Joint Processing (JP) and Coordinated Scheduling/Beamforming (CS/CB). JP achieves transmission gain through joint processing, while CS/CB reduces inter-cell interference through coordination, as shown in Figure 4. To s u p p o r t d i f f e r e n t C o M P transmission modes, UE needs to provide feedback on channel state information. Three feedback schemes are defined for CoMP: explicit feedback, implicit feedback, and Sounding Reference Symbol (SRS)based feedback. For explicit feedback, UE feeds back information such as channel coefficient and channel rank without preprocessing channel state information. For implicit feedback, UE

Carrier aggregation uses band aggregation to expand transmission bandwidth; enhanced MIMO increases cell throughput by further expanding MIMO dimension; relay improves coverage through relay of radio transmission; and CoMP increases cell-edge throughput by coordinating multiple cells. By introducing these key techniques, LTE-A can meet or even surpass all IMT-A requirements. As of July 2010, ZTE has concluded seven LTE commercial contracts, and built nearly 50 LTE trial networks for telecom operators worldwide. The company also places great importance on LTE-A, taking an active part in drafting related standards and submitting proposals that have been adopted by 3GPP. With in-depth research into key LTE-A techniques, ZTE has developed an array of competitive solutions. ZTE is now working hard to develop a LTE-A prototype, and has made good inroads to this end. ZTE is leading the telecommunications industry toward wireless broadband communications. In 2012, its LTE-Abased eNodeBs are expected to be deployed globally. This will allow people to enjoy feature-rich multimedia services and high-speed connectivity using mobile broadband.

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Research Note

Business Model Analysis of Managed Services

By Wang Xinqiang

hen bidding begins for large-scale network projects, managed services are often considered an admission ticket. Many operators see managed services as a business strategy for globalization. Vodafone and Warid, for example, use unified RFPs and share bid evaluations, and have built a joint global business evaluation s y s t e m . S o u t h A f r i c a s M T N i s considering adopting a managed services strategy in both developing and undeveloped countries. As well as basic network operation and maintenance, operators are demanding more in terms of revenue management, business management, and terminal management, and managed services have become an increasing focus of attention.

maintenance of the network layer, business layer, and customer layer based on a Service Level Agreement (SLA). Managed services adopt standard processes, reusable resources, flexible value chain cooperation models, and revenue distribution schemes so that operators can optimize their business and financial performance and focus more on core businesses.
Business Layer Customer

There is no standard definition of managed services, and this is ZTEs current understanding of application scenarios for managed services in the telecommunications industry. The term managed services originally referred to any user facility management service provided by operators to enterprise users. It was overly simple and did not take into account SLAs. The SLA is the foundation of service

Service Management

Business Consulting

Customer

A&C Partnership

Collocation

SDP Management

Application & Content

SLA Assurance

Network

Maintenance

Operation

What are Managed Services?

Managed services are professional network management services that include integration; and operation and

Vendor

Design Plan Optimization

Network Deployment

Service Layer Spare & Logistic Facility Management

Figure 1. Hierarchy of managed services.

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October 2010

delivery, and service capability is an absolute prerequisite. Managed service solutions should adapt to the business models of operators and the following should be considered: Support measures for product solutions (product maintainability, interface openness, and SDP) Integration with third-party products and client devices Delivery cooperation model and income distribution program Three changes should be considered for business models: Changes in the profit model (resulting from changes in the cost and revenue models) Changes in the value orientation (from equipment selling to service or business selling) Changes in the customer relationship (from a buyer-seller relationship to a partner relationship)

home markets of other operators, competition has heated up. Shorter time to market for new products and rapid development of new business is therefore necessary to compete. Management optimization: The emergence and convergence of new technologies, new businesses, and complicated value chains have made network management more difficult. Supply chain management, network technologies, and services, need to be simplified and integrated so that operators can focus on core businesses and front-end markets. Risk transfer: The risks associated with new technologies and new
600000

businesses should be shared with equipment suppliers in order to minimize investment risk. Service management is an essential part of the new telecom ecosystem and this creates win-win opportunities for all participants. By optimizing and sharing resources, complementing business abilities, and sharing risk, service management creates additional sources of income. The need for service management is also evident when the CAPEX and OPEX of mobile operators is examined and OPEX broken down (as shown in Figures 2 and 3). CAPEX of global mobile operators

US$m

400000

200000

Driving Force of Managed Services

Managed services are driven by the transformation of telecom operations in terms of: Financial targets: As the telecom market continues to slump and the telecom ecosystem deteriorates; new approaches to cost reduction, streamlining revenue, cash flow performance, and ROI must be sought. Among these, reducing OPEX is the most critical. Business performance: New technologies are continually e m e r g i n g . To i n c r e a s e c o r e competency in the market, new technologies must be obtained and business performance improved at reduced cost. Deployment capability: Since competition is globalizing and new operators are asserting themselves with new technologies in the

0 2005 2006
CAPEX

2007
OPEX

2008

2009

2010

Source: Pyramid Research.

Figure 2. Mobile operators CAPEX and OPEX.

Network Services 70%

Share of OPEX
100 90 80 70 60 50 40 30 20 10 0 Source: Pyramid Research. Cost of Services 25% R&D 2% Cost of Equipm ent Sales 15% Depreciation and Amortization 25%

Transport 10%

Interconnection, Termination, and Roaming 18%

Selling, General, and Administrative 35%

Figure 3. OPEX breakdown for a typical mobile operator.

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Research Note

Managed service capability is important in the decision-making process for product purchases. Outsourcing of managed services has become a better choice for operators, and it is crucial for manufacturers to provide professional services.
reached peak value (about US$137bn) in 2007 and has declined steadily ever since. New business expenses in CAPEX have increased from 10% in 2000 to 30% in 2010. OPEX of global mobile operators is three times CAPEX (about US$400500bn annually). However, since 2008when operators were equipped w i t h c o n v e rg e d , a l l - I P n e t w o r k technologiesOPEX growth has slowed. For a typical mobile operator, service costs account for 25% of OPEX, 70% of which are for network service. The ratio of network service expenses to total service expenses in OPEX and CAPEX (e.g. for service management tools) has grown from 33% in 2005 to 45% in 2010. Conflicts and opportunities in next generation network transformation promote service management: The traditional resource-based profit model of bearer networks is being challenged, and bit paradox has become the bottleneck of next generation business network operation. The value chain model is an inevitable trend, and virtual operation and managed services have come into fashion. Managed services at the business layer involve risk sharing while next generation network profit models are sought. The development of an industry profit model goes hand in hand with development of managed services business models. Manufacturers can thus provide more solutions and business models to meet customer needs in the value chain. services from virtual operators and enterprises may be a blue ocean for traditional network vendors. The active roles of IT enterprises in the managed services field will give rise to new competitive arrangements.

Conclusion

Development Trend of Managed Services

Managed service capability is important in the decision-making process for product purchases. Outsourcing of managed services has become a better choice for operators, and it is crucial for manufacturers to provide professional services. Network-layer managed services will dominate the market, and will be provided by device manufacturers with product operation ability or managed services providers. Business-layer managed services have an uncertain future because industry profit models are still being explored. However, the total available market is growing rapidly and business-based market segmentation needs to be tracked. Marketing of customer-layer managed services will also be segmented and more suppliers will offer managed services. The growing demand for managed

The transformation of the telecom business models has led to the development of managed services. New networks, new businesses, and highvalue domains have grown quickly as a result of value chain managed services. The NGN business profit model is still being explored, with risks being shared with manufacturers. The network layer, business layer, and customer layer have different capability requirements for managed services. Equipment suppliers should develop and offer different managed service solutions according to different paths and modes. B u s i n e s s m o d e l s o f d i ff e r e n t manufacturers have a common point in taking advantage of their own products and resources. Managed services capabilities can be improved through organizational transformation, cooperation, and mergers, and profit can be made by selling competitive solutions.

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News Brief

CSL and ZTE Set to Commercially Launch the Worlds First Dual Cell HSPA+ (42Mbps)/LTE Network
7 September 2010, Hong Kong At the LTE Asia 2010 Conference today, CSL Limited (CSL), Hong Kongs leading mobile network operator in partnership with ZTE Corporation, a leading global provider of telecommunications equipment and network solutions demonstrated CSLs progress to being the first in the world to simultaneously deploy DC HSPA+(42Mbps)/LTE technologies on an entire network. CSL and ZTE demonstrated to the world live LTE service with pre-commercial USB modems running various broadband, multi-media applications, including high-speed file download/upload, internet browsing, HD video download and streaming performance, and many other features that will resonate with the next generation of mobile users. This gives the delegates a first-hand experience with the LTE service being deployed all over Hong Kong.

ZTE Awarded 2010 IPTV Equipment Vendor of the Year Accolade

29 September 2010, Shenzhen, China ZTE has been recognized as the Best Practice Award 2010 IPTV Equipment Vendor of the year, marking the second time it has received the accolade. It received the award based on research conducted by leading consulting company, Frost & Sullivan. Among IPTV vendors, ZTE ranked third in the world IPTV middleware market in terms of subscribers in 2010 H1, and was the leader in the IPTV middleware markets of Asia and China in 2010 H1. With the development of the global broadband market, IPTV content and application has become more important. As one of the latest broadband applications, IPTV has attracted industry attention.

ZTE Supplies Over 3,500 3G Equipment to Taiwan VIBO Telecom

Total shipment of SDR base-stations is over 250 thousand units worldwide
27 September 2010, Shenzhen, China ZTE today announced it has signed a contract to supply WCDMA wireless equipment to VIBO Telecom Inc. As a subsidiary of theTaiwan Kinpo-Compal Group, VIBO is the leader of pure 3G WCDMA operator in Taiwan. Under the agreement, ZTE will supply more than 3,500 3G basestations to replace VIBOs existing 3G network around Taiwan within one year. The base-stations to be provided for VIBO are based on ZTEs industry-leading Software Defined Radio (SDR) technology. In recent years, ZTE has achieved a breakthrough across the global UMTS markets based on its leading edge SDR technical platform. To date, the total shipment of ZTEs SDR base stations is already over 250,000 units, used by more than 60 operators in over 40 countries.

ZTE to Build CDMA Network for Polkomtel

Data services main driver for nationwide network in Poland
14 September 2010, Shenzhen, China ZTE is to upgrade Polish operator Polkomtels national CDMA network. ZTE will supply equipment for the network in the 450MHz (L band), upgrading existing infrastructure to improve coverage and enable data and Push-to-Talk services. Polkomtel is one of the largest operators in Poland, with about 14 million subscribers. ZTE Poland will supply all equipment for the network including base stations and controllers, switching nodes, service platforms, and a GoTa digital trunking system. There is a growing demand in Poland for data services and high-bandwidth applications. Our subscriber base wants to be connected and make use of social networking. ZTEs CDMA technology enables Polkomtel to stay ahead of the competition and offer consumers the quality of services and innovative applications they are looking for, said Jarosaw Bauc, President of the Board at Polkomtel.

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News Brief

ZTE Launches the Gecko, the Worlds First Multi-Carrier Super-Mini CDMA Base Station
30 September 2010, Shenzhen, China ZTE today announced the launch of Gecko, the first multicarrier super-mini CDMA base station available in the industry. The innovative Gecko is small in size (measuring 26cm18cm 5.8cm), lightweight, easy to mount and satisfies operators networking requirements, such as indoor blindspot coverage and hot-spot traffic distribution. The Gecko helps operators make up for any deficiencies, improves network quality, enhances user experience and builds highefficiency and high-quality CDMA networks. Z T E s G e c k o b a s e s t a t i o n supports several IP networking modes and achieves access by using various transmission resources (such as MAN, LAN, PON, xDSL, and satellite). Its coverage radius can reach 300 meters, thus meeting high service standards for use in offices, hotels, retail and entertainment outlets, as well as providing high quality indoor 3G data and voice services.

ZTE Launches Industrys Most Complete 100G End-to-end Carrier Network Solution
Carrier network operators to benefit from comprehensive range of UWB products and services
28 September 2010, Shenzhen, China ZTE today announced the launch of the industrys most complete 100G endto-end carrier network solution, which will provide the bandwidth capacity for network operators to meet increasing network traffic demands. The explosive popularity of IT applications, HD video services and cloud computing has led to a massive spike in network traffic. For carrier networks to provide sufficient capacity, operators need to expand and upgrade their networks smoothly. Through the deployment of ZTEs ZXWM M920 and ZXONE 8000 as part of the Ultra Wide Band (UWB) 100G carrier network solution, operators can eliminate any traffic bottleneck in the core networks, and fully meet the demands of the growing data business. To achieve the 80-wave, 100G ultrawide system capacity, ZTEs complete solution incorporates the use of ZXR10 T8000 in the IP layer to realize the smooth upgrade from 10G to 100G. ZXR10 T8000 is a telecom-class 100G routing cluster system with the largest capacity in the industry, which can support multiple services with compromising performance in case of full-service overlapping. By using chips with self-owned intellectual property, ZXR10 T8000 can maximally support 16+64 multi-chassis system and 200T switching capability.

ZTE Launches Converged Service Network Platform

SDP as a Service solution announced at SDP Global Summit
15 September 2010, London ZTE today launched its Converged Service Network (CSN) at the SDP Global Summit in London. ZTEs CSN incorporates traditional SDP architecture and cloud computing features, enabling an SDP as a Service (SDPaaS) solution for the first time. The CSN provides an efficient and stable service network platform for operators, third-party application providers, and individual or group application developers. The CSN is a new service network platform integrating mobile and fixed network infrastructure onto a basic platform that supports both Internet and telecoms services, providing a flexible solution with efficient management and control features. Traditional SDPs also provide the flexibility to support and manage different services, but are not able to support multi-domain service convergence, or an environment where developers can collaborate and share innovative services.

Gecko Base Station

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