The ability to “virtualize” is critical for operators evolving toward ThinkingNetworks™.

Network Function Virtualization (NFV) implementations and virtualization of the Evolved Packet Core (EPC), as well as systems outside the EPC (e.g., billing), can significantly reduce network costs and help operators become more efficient in matching resources to network and service demands. NFV gives service providers the ability to elastically assign compute and storage resources through a software-only approach.

Assigning resources only where needed is important when it comes to Diameter network elements, especially the Diameter Signaling Router (DSR) and Policy Server (PCRF), which have to be “cloud ready” in order to successfully control LTE EPC functions.

Virtualization will essentially partition the resources of a hardware platform into unique “virtual machines.” These virtual machines replicate standalone functions currently supported on separate hardware. If more compute resources are needed to support a Diameter function, any available hardware can be chosen and a new instance of the virtual machine created by the hypervisor.

The same hardware could also be used to support instances of a policy function at the same time, if enough compute resources exist. It’s that ability to dynamically allocate additional compute and storage resources when needed – using a common pool of hardware – that makes virtualization so important.

The move to NFV implementations will mean operators expand virtual functions to support multiple regions, or extend functions to other partners as part of their cloud offerings. For example, MVNOs or multinational operators looking to put their packet core into the cloud can manage all services and countries through one implementation.

A Closer Look At NFV

At Tekelec, we have developed the Orchestrator, which determines through analytics and other inputs when additional resources are needed. The Orchestrator instructs the Virtualizer (the hypervisor) to create another instance of a function. The Virtualizer creates additional resources, and other instances of the DSR or PCRF per the Orchestrator’s instructions.

Since the Orchestrator is the function that determines what, when, and where additional compute and storage resources are needed, it goes into action when traffic levels in the Diameter network increase. It identifies the rise in traffic and determines if additional DSR or PCRF resources are needed to support the rise in traffic.

Once the Virtualizer implements the new instance of DSR or PCRF, the IP Flow Manager directs IP flows to the new instance of the function (since routing tables will not reflect newly configured hardware).

The communication and cooperation among these components gives networks the ability to expand and contract based on real-time traffic conditions. That capability will become invaluable to operators trying to balance the need for innovative services with the need to maintain network performance levels – both essential to the customer experience.

Mobile operators will continue to invest heavily in their relationships with customers, as they want to champion their brands as Apple, Samsung and Google have done. They also want to ensure their revenues and profits are not further eroded long term by third-party applications and over-the-top providers.

To create positive consumer perceptions about their brands and to deepen their customer relationships, operators know they have to differentiate according to more sharply defined customer wants and behaviors. This means offers and supporting network resources must evolve to dynamically adjust according to how people behave as individuals and in groups. This may include sharing data in real time with advertisers, or optimizing Quality of Service according the needs of an over-the-top application. In short, operators are are becoming “digital-lifestyle providers.”

The most critical element of this transition to digital lifestyle provider status is an adaptable, dynamic and flexible network, one that understands the customer in detail and responds to their actions with personalized, informed reactions. In short, operators require ThinkingNetworks™. This is not a ‘rip-and-replace’ proposition; rather, it is a phased evolutionary approach that adds and changes technological resources as the operator’s business changes according to market demand.

To evolve today’s mobile networks toward this more effective end state, we see four key overlapping phases, including:

• The New Diameter Network (NDN)
• Virtualize through the Cloud
• Monetize in mobile and social-networking environments
• Realize a policy-driven, software-defined ThinkingNetworks™ end state

In the first phase, operators tame the ‘signaling storm’ that could compromise their investments in Diameter-based environments through the New Diameter Network, which brings agility and speed to routing and signaling and provides crucial policy insight about subscribers and their devices, behaviors and apps. Policy becomes the ‘big brain’ of the network, keeping all relevant gateways, databases and operator systems informed. It also facilitates the real-time personalization that is essential to today’s demanding customers.

With that network humming, operators are ready to move into the second phase – a cloud environment that virtualizes network resources. This adds the benefits of on-demand resource allocation and optimal capacity utilization. It also exploits industry trends in software-defined networking (SDN) and standardized hardware improvements that are bringing down CapEx and OpEx unit costs.

In Phase 3, operators turn the tables in the market and go from passive ‘pull’ status to active, relevant ‘push’ vehicles, capable of interacting with entire social networks based on user interests and group behaviors. And, just as the human brain takes in multiple data points simultaneously to influence one’s actions, “one-of” consumer transactions suddenly become a dynamic real-time web of interactions. The network can then push revenue-generating recommendations, offers and ads based not just on one-to-one behaviors, but across this pulsating network of group insights, preferences and decisions.

Finally, in phase 4, ThinkingNetworks™ continually listen, learn and optimize. Instead of periodic off-line reporting and inexact capacity planning exercises, the operator is now given the power to adapt resources according to that delicate balance among business plan goals, network conditions, and customer desires.

The end game is achieved by giving the operator the capabilities they have sought for so many years: the ability to serve the market more quickly, more dynamically and more cost-effectively, and this is what brings differentiation and puts the operator in the driver’s seat as digital lifestyle providers.

To learn more read the new whitepaper: The ThinkingNetworks™ Revolution: A Call to Action for Digital Lifestyle Providers

Everyone is busily preparing for GSMA’s Mobile World Congress in Barcelona next week, the theme for which is “The Mobile Horizon”. No doubt many operator discussions will focus on what’s next in LTE networks, and there most certainly will be an endless stream of “cloud” announcements.

These are exciting developments for the industry that hold great promise for better overall delivery (leading to improved customer satisfaction) at a reduced cost, but there is a cautionary tale in the background: you can’t scale your network through LTE upgrades or ‘cloud’ virtualization alone; your signaling environment has to be equally robust.

To understand this better, let’s unpack the market and network dynamics that got us to this point. As consumers rapidly adopt mobile devices and applications as part of their immersion into a digital lifestyle, the demand for bandwidth becomes outsized, leading to traffic chokepoints, even on important traffic. Soon everyone is unhappy.

In an effort to remedy this problem, operators have adopted strategies such as WiFi offload and creative offer packaging and pricing. These are good “holding actions,” but are not sufficient in the long term. Operators know this and are deploying LTE network capabilities in the hopes of being able to better serve these same demanding consumers with a more cost-effective (and eventually all-IP) network.

Finally, there is a great flurry of data center activity to put everything in a cloud environment for on-demand access to resources.

Likewise, software-defined networking (SDN) holds promise as a means to virtualize network resources in ways that will serve these varying levels of demand in the most dynamic, low-cost ways.

All of these are useful tactics, but they don’t really get the whole job done.

Recall that at the highest levels, SDN separates the control plane, i.e., the orchestration of resource allocation in the data center from the “data plane”. Inside the data plane, of course, resides the actual end-user payload. But a less-often discussed component – Diameter signaling –allows the great variety of servers, gateways and other network elements to set up sessions, authorize users and enable charging for the newest and potentially most profitable services.

Cloud virtualization certainly allows the two SDN planes to operate and scale in balanced, complementary ways so that one only spends what is needed to grow the network, but still serves user demand . At the same time, signaling must be even more robust.

According to the Tekelec LTE Diameter Signaling Index™, while data demand is growing at unprecedented rates, the signaling associated with this demand is growing three times faster!

Without an adequate signaling infrastructure based on a centralized, core Diameter signaling architecture, the network continues to be constrained by the communication path between elements such as gateways, charging systems and policy engines.

So while you’re noshing on tapas at the Fira Gran Via next week, consider not just your LTE network element and cloud needs, but the Diameter signaling requirements that actually ensure these investments deliver on their promise.

Downtown DC has braced for the arrival of up to 800,000 people, who will observe the 57th U.S. Presidential inauguration today. The event will be tweeted, shared and recorded on video by the assembled crowds, some of whom will be using 4G services and applications on their smartphones.

Besides the additional data traffic surge, Tekelec expects this event to generate increased Diameter signaling traffic, thanks to an increased density of LTE device users attending the ceremonies. In fact, the 57th Inauguration is sure to be very different from the 56th in terms of technology: four years ago, smartphones only had approximately an 11 percent market penetration – and BlackBerrys outnumbered iPhones two to one.

Additionally, LTE was not yet in service anywhere in the world.

Now, more than 55 percent of Americans own a phone that is capable of video streaming or Internet connectivity – a total of more than 100 million Smartphones. Add to the mix a new, dedicated free Inauguration app with live streaming (Inauguration 2013), and it’s easy to see how mobile data and subsequent Diameter signaling traffic will surge.

The density of LTE-enabled devices means that 4G coverage will be seriously tested during periods of peak usage, thus forcing subscribers onto 3G and Wi-Fi networks. Also, attendees’ mobility in and out of coverage areas may cause subscribers to switch from LTE to 3G networks, and back again. The result on the core network will be periodic spikes in Diameter signaling traffic.

It will be interesting to see how operators fare once users start comparing what they expect from their devices and mobile network providers, and what actually ends up taking place to either enhance or mitigate the Inauguration experience.

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When natural disasters like tropical storm Sandy hit, IP networks bring about a different challenge than traditional networks. Where network operators traditionally could block or throttle traffic after a storm to ensure congestion would not bring down networks, the status quo now is to have many elements of the network under the control of a 3rd party, which means operators cannot directly control all parts of their networks in a crisis.

Because IP invites many new methods for communicating, it also has to invite many new methods for managing the network. And as we see it, the network must be controlled at two different points: the packet network where the data flows, and the control plane where the signaling controls the sessions.

We also see two distinct forms of signaling, with signaling in the RAN and signaling at the core with Diameter. These forms of signaling serve different purposes. The signaling at the RAN typically establishes data session (or voice session if applicable), and signaling in the core uses Diameter to authorize and authenticate subscribers. Though the latter is not invoked as frequently as RAN signaling, it is just as critical to the operations of the network.

As proven during Sandy and other natural disasters, congestion of the core signaling network is a key concern operators have to address when friends and families flood lines in search of loved ones. When the core fails, nothing works, therefore making the core becomes a critical component in the network. This was also true within the SS7 domain, where operators also blocked traffic at the core level.

But, in using a point-to-point architecture, where the Diameter end-points are actually embedded within a network element, blocking of traffic could become difficult, if not impossible. That is attributable to the fact that congestion control can be applied only at the point at which the function resides. It’s well accepted, therefore, that a centralized approach to end-to-end core network congestion control is most effective.

The Importance of a Diameter Signaling Router in Crisis Situations

Geographic redundancy and traffic control is paramount to a robust signaling network that can survive any crisis. There exist countless examples of how the SS7 network survived calamities such as floods, earthquakes, fires, and even terrorist attacks. It was usually geographic redundancy and optimal routing managed through the core rather than the end points that made this possible.

In a Diameter world, the Diameter protocol itself does not inherently support automatic re-routing and disaster recover functions like SS7 did, but the same can be accomplished through a centralized routing function in the network core. That’s why a Diameter routing agent like our Diameter Signaling Router (DSR) is becoming so important to preventing core signaling outages during a crisis. The DSR ensures messages reach their destination through alternative routes known to the DSR. That means the messages so important to subscriber databases like the Home Subscriber Server (HSS) , policy servers (PCRF), charging systems and gateways will get through in times of disaster.

And most importantly, it means operators can continue to generate revenue from services requiring Diameter signaling, even in times of disaster.

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Telecom Asia today quoted Gulzar Azad, Mobile Partnerships Lead – India and APAC at Google during this week’s LTE Asia event in Singapore (where Tekelec has made partnership and customer-win announcements).

Azad stressed that mobile operators need to think in terms of service delivery, not data plans, meaning they have to go beyond monthly subscription fees and add value to the types of services OTT players, content providers and others are currently driving.

He suggested operators expand their thinking on limiting their networks so they can better capitalize on the likes of Facebook, Google Plus and others by using them as platforms on top of which they can build multiple channels for not only local or regional audiences, but also global ones. By aggregating, augmenting and adding their own content, mobile operators can do more to create and monetize services tied to their own brands.

All mobile operators pushing for success will have to start thinking of themselves as “digital lifestyle providers,” and with that comes a need to work harmoniously with OTT, M2M, cloud, mobile advertising and mobile payment services.

Making It Happen
Mobile operators moving toward this type of business model will be required to work with third parties (whether social networks, OTT or mobile advertisers). That means orchestration, and lots of it, will be needed to expose policies, subscriber data, charging data, and analytics – all critical to LTE services.
Additionally, it will require operators scale for the millions of new devices populating LTE networks, and accommodate the multi-session nature of new devices.

These challenges all point to a need for a new Diameter network (NDN), as Diameter is the protocol that facilitates policy and charging rules for new business models and the protocol that ensures secure interconnection among partners and privacy for subscriber information.

As revealed last week in the Tekelec LTE Diameter Signaling Index®, global signaling traffic will grow more than three times faster than mobile data traffic over the 2011-2016 period, reaching nearly 47 million Diameter messages per second (MPS) by 2016 (a 252% CAGR over the forecast period).

Roaming, concurrent data sessions, video streaming, QoS guarantees and behavioral changes via social networking over mobile devices will all account for these tremendous surges in Diameter signaling traffic and will mean DSRs and other elements of an NDN will grow in importance.

Today we released our Diameter Signaling Index – a first-of-its-kind “guide” designed to help architects, engineers and marketers calculate the impact of devices and services on network signaling traffic.

It’s perfectly timed, as the iPhone 5 will be a prime example of the multi-session nature of new devices and the multi-tasking that will ensue for each subscriber. The consequent surge in Diameter traffic will require unprecedented levels of orchestration and communication among user to devices, cell towers, policy servers, charging systems, and subscriber databases and gateways.
As indicated in the report (which took a conservative road in its assumptions), there will be 47 million Diameter messages per second by 2016, representing a compound annual growth rate (CAGR) of 252% between 2011 and 2016.

The iPhone reflects the type of sophistication that will trigger more use cases around policy, which will in turn trigger more Diameter signaling. Mobility management functions and roaming will all have substantial impact.
So what does it all mean for operators, who obviously know what’s coming and have been building Diameter signaling strategies into their planning?

It means that what used to be addressed with a mesh approach to Diameter must now be addressed with more of a centralized approach. A centralized Diameter signaling architecture will be needed to effectively route, measure and monitor Diameter traffic so that signaling storms are held at bay, and so that the customer experience is optimized rather than compromised.

And since authentication will be invoked each time someone powers on an LTE device, or every time someone activates a new device (as with the 10 million iPhones forecasted to be sold this month), there could be as many as 60 million authentication messages generated by that event alone.

So, just as the original iPhone changed phone usage habits, so too will the LTE iPhone have an impact on LTE networks. New usage profiles and patterns combined with tiered service plans and the associated policy and charging information will equal A LOT of Diameter traffic. Charging for example could represent as many as 6 Diameter messages per session (depending on the type of session, billing arrangements, and numerous other factors, 6 is conservative).

New business models such as sponsored traffic and advertising also will require Diameter interactions, which means we’ll see more centralization of Diameter architecture to accommodate the evolution to LTE – on the iPhone and other devices.

With the Olympic Games just around the corner, network engineers everywhere are asking the same question: ‘How big an impact will the Olympics have on wireless networks?’ The Olympics can serve as a microcosm of analogies to a bigger issue – the impact of data surges on Diameter signaling, especially where LTE coverage is available.

The Olympics pose an opportunity for service providers to monitor Diameter signaling traffic and analyze the trends for future engineering. In doing so, they have many points to consider:

For one, it will be interesting to see how the cellular networks perform in London. Though the packet network will be upgraded to support higher data rates, the signaling core will remain SS7, as LTE will not be implemented in time for the Games.

Two, the devices and the savviness around their use have only improved since the last Olympics in Beijing, so social media and mobile devices will be the primary media over which events will be viewed and information shared. Video usage will be off the charts in comparison to what was possible in China, where the first “digital” Olympics took place (albeit on far fewer channels than are available today). There’s no question the London Games will generate unprecedented amounts of video content via official and not-so-official channels, such as Olympic Committee YouTube channels and related Facebook, Twitter and other social media channels. All will see significant increases in their traffic as viewers in different countries elect to watch through their iPads and Smartphones.

NBC alone is expected to deliver 5,535 hours of programming, with HD programming available through broadcast channels. Additionally, NBC (and other broadcasters like the BBC) will provide live streams through various web sites and social media. While this may not have a direct impact on London mobile networks, there may be residual impacts on home networks where LTE is available, as social media connections will inevitably increase Diameter signaling –especially where connections are left on all day, and if policy is implemented to assure certain quality levels or to control congestion.

Another interesting point to ponder is the level of personalization that will emerge in these Olympics. For example, NBC will allow viewers to select what view of an event they want (i.e., what apparatus in a gymnastics event they want to see). That ability may generate a significant amount of video streams and hence a lot more signaling (albeit Diameter signaling as opposed to SS7 signaling).

In addition to watching the impact of actual video consumption, operators should watch closely the impact of WiFi, as roamers will have about 100,000 hotspots throughout London with which to alleviate roaming fees they’d otherwise incur on the mobile network.

In all, London will strive to provide 4 times the capacity than was possible in Beijing. With so many visitors and professionals covering the events (21,000 reporters converging on the city to cover the Games), every Gigabyte of capacity will count.

Not only should mobile operators consider the impact on London’s networks, but also the impact on their own networks, as fans not able to travel to London will watch their favorite athletes through the numerous online channels being made available to them.

With millions of Smartphones and tablets sold in the last several years (especially iPads and iPhones), expect a huge increase not only in data traffic but in signaling traffic as well.

As stated earlier, Diameter will be affected anywhere 3G or LTE is deployed. It’s just not clear yet how significantly. We suspect there are enough subscribers on LTE networks today to have an impact on any service provider’s network.

With so many variables to Diameter traffic engineering, it is impossible to put a number on the amount of Diameter traffic we will see just by evaluating data. Suffice it to say, however, there will be significant impacts on signaling as a whole, and where policy is implemented in 3G and LTE networks, that impact will be much greater.

Ever wonder what Lily Tomlin was doing when she would say “one ringy dinghy, two ringy dinghy”? Or how about Sarah in Mayberry RFD when Andy would pick up the phone, turn the crank a few times, and ask her to connect him to Aunt Bea? These are all examples of signaling being used to connect calls in the days before electronic switching. When you wanted to make a call, you turned a crank on the side of the phone, which then triggered “signaling” in the form of a light illuminating and a bell ringing on a switchboard.

The operator would then ask a series of questions so she knew how to connect your call (signaling again), after which she would manually plug a cord into a jack on the switchboard, completing the circuit to the destination, or to another operator in another city.

Signaling has changed drastically through the years, with everything involved now fully automated. Signaling allows the various elements within a network to communicate with each other regarding a specific connection. But nowadays, signaling takes many forms, depending on its purpose. There is signaling between a mobile device and the cell tower. There is signaling between the cell tower and the core network. And there is signaling within the core of the network. Regardless of its purpose, signaling up to now has been nothing more than pure overhead, contributing little to service provider revenue.

Though signaling has taken many forms over the years, the industry is now making a concerted effort to consolidate technologies and reduce the number of signaling methods used in networks to just two: Session Initiation Protocol (SIP) for connecting voice and video, and Diameter protocol for authorizing and authenticating subscribers and their devices.

Not only is Diameter used to access subscriber databases authorizing network access, but it also is used for charging as well. Most importantly, Diameter is used by network elements to communicate with the Policy and Charging Rules Function (PCRF).

It is the PCRF in the Evolved Packet Core (EPC) that allows service providers to personalize services they deliver to their subscribers, whether tiered service plans, parental controls or others. The role of policy in the network continues to grow as service providers get more and more creative with the rules they can generate to control the traffic in their networks and define new services.

The PCRF not only contributes to the bottom line on the balance sheet, but it generates new revenue streams for service providers such as mobile advertising and over-the-top (OTT) application subsidies.

Never before has one function in the network represented so many new opportunities for service providers, which are literally redefining the role that they play in the mobile ecosystem. They can now offer to their subscribers more intelligent choices tailored to their lifestyles, while also engaging new partners previously seen as competitors for the purpose of creating more compelling services.

OTT players such as Google, Facebook, and YouTube depend heavily on the network to reach their subscribers, but until now have contributed little to nothing back to the service providers as compensation for the network costs. But that can change as OTT players come to realize the value of becoming partners. As that happens, signaling will continue to move to the spotlight as a revenue generator rather than a pure cost of doing business.

As that happens, Diameter will be the signaling protocol that makes monetization of OTT services possible, and it might possibly be the one technology that will change the face of service provider business models forever.