Telecommunications

August 25, 2006
T&M Industry: Raising the Bar of Expectations

Geetanjali Babbar

INTRO -- Never has the need for test been greater. As the pace of innovation has increased, so too has the pressure to get new, differentiated products to market quickly. Consumer expectations continue to increase; in electronics markets, for example, integration of many disparate functions is required in a small space and at a low cost. The economic downturn of the past three years has not curbed the need to innovate, but instead has only added the restraint of fewer resources. Meeting these demands is now a factor in business success; whom ever can meet these demands fastest, most consistently, and most reliably, has a decided advantage over their competition. All of these conditions drive new needs for validation, verification, and manufacturing test. Communications test and measurement (T&M) will help accelerate the wireless evolution by providing the design tools, test equipment, and consulting services that are crucial for wireless device and infrastructure development, manufacturing, deployment, and operation.

NEW DELHI -- The wireless world is accelerating. 3G is quickly moving on to 3.5G, 3.9G and 4G and is changing the way the world communicates. The evolution of wireless technologies including cdma2000, GPRS, EGPRS, W-CDMA, HSDPA and 1xEV, allow development of new wireless devices that combine voice, Internet, and multimedia services.

India has been witnessing a robust growth in the test and measurement space. This growth has been observed across all industry segments. There has been an increase in private participation in aerospace and defence. Telecom service providers have been investing in T&M.

With the robust growth in subscriber base, handset manufacturing is attracting many key global players to India. International companies such as Nokia, LG, Elcoteq, Ericsson, ZTE, Samsung, LG, etc. have announced their manufacturing plans for GSM and CDMA. In the year gone by, both private and public sector telecom service providers invested in tools for network deployment and upgradation. GSM, EDGE and WCDMA stack development will continue to be on an increase. The new telecom manufacturing companies in the country are expected to boost the communications T&M market.

The telecom sector has also contributed to the development of T&M industry. MNCs are showing interest in India and are increasingly shifting their R&D bases here. R&D in 3G handsets shall continue. In fact, we foresee the participation from India on R&D for 4G handsets as well. HSDPA, WiMAX and DVB-H are new focus for several companies in India DTH are also expected to be in demand.

In addition, test and design houses are rapidly evolving into centers of innovation where cutting-edge R&D is undertaken. 3G mobile in the shape of UMTS with WCDMA as radio access technology is already a reality. UMTS/WCDMA offers business users and consumers an evolution of their current mobile experience to add video and other exciting new services.

Almost all the major mobile manufacturers are currently present in India. As they scale up production to full capacity, T&M industry will witness a significant growth. With telecom being the largest and quickest growing industries in India and with the regime of 3G and 4G coming in, the communications T&M industry is in for a bright future.

The communications test space strongly depends on the developments on the communications market. The driving forces of this market are the need for means of communication, for security and for steadily increasing transmission capacity. Especially in the countries with up-and-coming economies, wireless communications will play a part in considerably increasing the productivity and the quality of life. Therefore, every company participating in the value-added chain must be able to offer high-grade technologies at a favorable price.

Key Technology Trends

In the past few years, the number of standards and technologies in the wireless area increased considerably. Wireless networks for Internet via WiMAX, mobile handheld TV or infotainment in the automotive sector: The applications are becoming more attractive for the end users, while presenting greater and greater challenges for manufacturers and network operators. The next-generation of mobile radio is already emerging alongside HSPA: UMTS Long Term Evolution (LTE).

There are business cases for a variety of standards, depending on different technological and country-specific requirements, and different use cases. One consequence is an increased need for interworking between technologies.

Today's world runs on electronics - from the cell phones in people's pockets to anytime-anywhere Internet access. For advancing these and other essential applications and products, Agilent Technologies has been the pioneer in introducing innovating and cutting-edge technologies for T&M.

After the mobile communications, the next big splash in the telecom space is broadband. It is estimated that by the end of 2010, India will have approximately 20 million broadband subscribers. The technologies that can make this happen are DSL, WLAN, WIMAX and Mobile 3G.There will be large scale deployments of broadband network infrastructure in India for the next few years. RF and microwave measurements will become absolutely critical for these operators.

Service providers such as BSNL, VSNL, Reliance and Bharti are engaged in a fierce battle for market leadership in the broadband area. These service providers have realigned their business models to suit this market; even traditional players in the mobility space such as Airtel, Tata Indicom and Reliance have setup separate business units catering to broadband customers.

Another potential growth market is operational support systems (OSS). Now that most of the network infrastructure is in place and due to growing competition within telecom operators, there will be more focus on, a) predicting network failures in advance, b) offering new services, c) knowing subscriber trends/profiles, and d) proactively aligning business/marketing policies as per changing market dynamics. All this requires OSS deployment.

Also, network management is being given due importance to improve quality of service (QoS). As networks become more complex and use multiple vendor network elements, they will require monitoring tools to troubleshoot, maintain and optimise their networks to meet QoS and SLA requirements of customers. T&M instruments are being developed to help achieve these objectives. There is a shift from network to customer-centric service management.

Another trend is that of telecom merging with IT. We might hear more of Infocom than just pure telecom in the days to come. Wireless communications are connecting us, our homes and businesses in new ways. Everyday we become more reliant on wireless systems - from massive communication satellites to tiny RF identification tags; from global cellular networks to the hand-held, mobile devices that deliver our news, entertainment, personal messages and more. An unplugged world requires absolute confidence in the connections that replace the wires.

The entire communication industry is witnessing the revolution right now with the convergence of services in the wireline space. The most commonly used term for the convergence of this service is the triple-play service, which means playing out the voice, data and video from the same interface in the customer premise. It is worth noting that this is the drive, which is going to benefit most of the home customer since the industry is focusing on the growth from the residential customer more from this triple play service.

Industry is witnessing IPTV deployment among service providers in India. According to a study done by ABI Research, total subscribers for IPTV may exceed 120 million by 2010 with Asia Pacific constituting roughly 47 percent of the total subscribers worldwide. China and India are seen as major markets. This technology offers customers services such as video-on-demand (VoD), interactive TV, etc. and is fuelling the next level of telecom industry revolution.

Jairam Pillai, managing director, National Instruments India added that the communications industry has been a driving force in the worldwide T&M market, and the Asia-Pacific region is seeing a more rapid CAGR than other regions. This trend is likely to continue for the next five to six years, India's rapid development in this space can be counted on to sustain this trend.

New Technologies a Challenge

Commenting upon the possibilklities of today's key technologies to shape tomorrow's communication testing industry, Frank Gröger, head, strategic marketing, Rohde & Schwarz, said: "The new technologies are a challenge for the communications test industry. It is therefore important to start participating in their development even during the standardisation phase and to involve customers early on. This is how we can provide specialist support to customers at each step along the value-added chain. The T&M industry thus helps its customers to develop and manufacture new user equipment fast and efficiently."

"The telecom operators are investing in a high-speed IP-based infrastructure over which they will be able to match the video offerings of cable through IPTV service. The cable operators are working towards providing toll-grade quality voice service using Voice over IP (VoIP) technology. JDSU is uniquely positioned to enable both sides to expand their offerings through our test and measurement portfolio which targets the triple play applications and the new network infrastructures that deliver them," added Irfan Modak, managing director, Acterna India.

"In the communication service provider space, we are seeing a race between the telecom and cable operators to deliver on the promise of Triple-Play: voice, video, and data with broadband connectivity delivered to the consumer by a single provider," added Irfan.

Past vs. Present

Like the communications industry, the T&M industry is also undergoing consolidation. Some companies were sold, and other companies sold parts of their business operations. Rohde & Schwarz, however, has been strong enough to achieve above-average growth on its own. The latest figures from the Prime Data market research institute show: "In the test and measurement fields surveyed, Rohde & Schwarz was the world's second largest supplier in 2005."

One of the key growth drivers is wireless boom. Wireless industry is growing by leaps and bounds. From R&D to manufacturing and deployment, investment is growing all across these segments. The future of wireless will be riding on 3G deployment and value-added services. On the other hand, wireline broadband is another key segment, which is helping T&M business grow. The explosive growth of infotainment industry is another area that will influence growth in T&M business.

According to Irfan Modak, networks are experiencing a "centrifugation". More network intelligence and service provisioning is being driven from the core to the edge of communication networks. As such, having equipment that is sophisticated enough to handle new broadband applications and portable enough to be used in the outside plant is vital to the success of NGNs.

"Fiber optics is seeing a resurgence, driven in large part by the build out of passive optical networks (PoNs) serving as the last mile broadband connection via fiber to the home (FTTH)," he added.

In August 2005, JDSU acquired Acterna, the trusted communications test provider. Now that Acterna is part of JDSU, network operators and manufacturers worldwide have access to a portfolio of award-winning instruments, systems, software and services that help reduce network costs while improving performance and reliability. JDSU is a world-wide market leader in providing fiber characterisation T&M and services to the telecom industry as more fiber becomes "lit up" to deliver broadband multimedia to the consumer.

Helping Customers Cut Expenses

Customers can reduce costs if they decide in favor of products that perform measurements extremely fast and efficiently. The Rohde & Schwarz CMU mobile radio tester, for example, is available in different configurations so that customers can choose the model that best suits their budget and applications. Many mobile phones for the Indian market are presently being tested by means of Rohde & Schwarz products.

"Rohde & Schwarz offers products for all price segments and applications. Spectrum analyzers such as the R&S FSL, signal generators such as the R&S SML or the R&S TSMU drive tester provide powerful features at prices that were unimaginable a few years ago. The Smart Instruments are a family of such powerful products especially for small budgets," added Frank Gröger of Rohde & Schwarz.

Shankar Roy Chowdhury, general manager, marketing, T&M, Agilent Technologies India, said: "Agilent offers the broadest T&M portfolio in the market today. From home entertainment to homeland security, from wireless and wireline communication to network reliability, Agilent offers its customers unmatched breadth and depth of measurement tools and expertise. Through innovation and expertise, we keep our customers on the cutting edge of technology."

Agilent's wireless design and test solutions span the entire product - development life cycle, from R&D through manufacturing. These solutions address every major category of wireless networking, with well defined road maps to incorporate emerging standards.

Cellular phones have exhibited the largest growth in the consumer electronics and communications sector. There is an increasing requirement for mobile handsets that can support advanced 3G wireless technologies like W-CDMA and HSDPA, and that can work for days rather than hours. With the broadest portfolio of design and test solutions in the wireless domain, Agilent provides solutions for the challenges customers face while designing and manufacturing next-generation mobile handsets.

Major Challenges

New technologies always call for T&M solutions that can handle them. A major change certainly is the convergence of the various media. Mobile reception of TV or Internet applications will soon be common. Rohde & Schwarz has already taken the lead in this field. The company's many years of experience in mobile radio are merging with its expert know-how in broadcasting. Rohde & Schwarz is thus able to support its customers in development, production and service alike. In times of fast technological changes, it is crucial to ensure that the customer's investment in T&M equipment will remain safe even in the future.

Manufacturing is yet to achieve the critical mass in India. This is n important factor that is acting as a damper to real growth. Import duty on T&M products is still very high. As T&M plays a crucial role in influencing quality across the life cycle of electronic products and services, the government needs to lower the duty to allow increase in usage of T&M.

"We mentioned how triple-play is becoming the catch phrase these days. While it sounds so good to have the triple-play service at home, there are many challenges in its implementation. Foremost is the requirement of the high-speed connectivity from the network to the customer location. The present copper wire system is inadequate to handle large bandwidth required for the video or the cable TV transmission. This is fuelling the R&D and deployment of the Ethernet Passive Optical Network (EPON) or General Passive Optical Network (GPON)," added Shankar Roy Chowdhury of Agilent Technologies.

From the triple play service perspective, the test challenges are both in the R&D and the deployment stage. Due to the complexity of the multicast IP technology involved, the video quality MDI and the channel zapping time is of critical importance to the service provider. Moreover it is also essential to check for the scalability and the response of the network and the content server. Agilent, which is the largest supplier of the core router tester, has the modular solution based on N2X and Network Tester to address these needs of the IPTV testing and the Quality of user Experience.

Frank Gröger of Rohde & Schwarz informed that technologies related to the third-generation of mobile radio and their evolution, WiMAX, wireless connectivity standards and the mobile TV standards are important for end users. These technologies allow numerous appealing applications that range from data-intensive downloads from the Internet via wireless access to TV on the mobile phone. T&M customers need platform concepts that can support various standards. In addition, it must be possible to easily add new standards at any time.

"The future challenges are the growing technological requirements and the limited budgets. The T&M industry must create innovative products and improve large-scale integration to be able to offer favorably priced products," added Frank.

To summarise, the growth of the Indian economy is mainly based on the growth of telecom sector. In the course of time, the entire private and public sector will be provided with communications equipment. This will increase the demand for high-grade T&M equipment and stimulate the economy as a whole.