Archive for December, 2015

AI and smart cities

Wednesday, December 30th, 2015

I have written quite a bit about artificial intelligence (AI) over the last 20 years – and perhaps even earlier than that. (Searches in our blog go back to 1999)

This in itself is an indication that things aren’t moving all that quickly. But looking back – in particular at the capabilities of smart phones and their apps – I can see that progress has been made. Certainly not through big bang events, but slowly and steadily nevertheless. And this is how progress should be made around artificial intelligence, because it will absolutely transform human society and we need time for that to happen.

And it is crucially important that we remain in charge of the process.

Give the way that issues relating to the environment, climate and innovations such as the nuclear energy have had a huge effect on humanity it is clear that we will need to stay in charge. The fact that we have nuclear treaties in place and have not used nuclear bombs since WWII – and that we have been making progress at COP21 in Paris – are indications that we can operate as a global society.

Looking at AI as a process of evolution, not revolution, some of the doomsday scenarios – like the prediction that robots are going to replace us – should be tempered by the fact that from a scientific point of view such an outcome would be at least a century away. This would mean that AI will continue along the lines of its current evolution, and that humanity can stay in charge. What needs to happen within the next decade is an international organisation along the lines of the Non-Proliferation of Nuclear Weapons Treaty and the United Nations Framework Convention on Climate Change Treaty (which forms the basis for COP21).

Already private industry has set up a working group to manage AI in drones and has asked the government to come up with regulations.

All of this is important and needs to happen; and the signs are that international collaboration will eventually lead to some sort of a treaty on AI.

However this should not us stop looking at the many benefits that AI will have to offer in the short- and medium-term of this century-long development, and this will be more in line with our recent smart phone experiences.

This brings me to the topic of smart cities. Those cities that are opening up their data and using the currently available AI software products (advanced algorithms, predictive analytics, learning adaptability) will be able to create new applications. Such applications and services could take you around town based on the input you provide to set up a guiding tour, shopping tour, transport suggestions. In relation to a tourist tour for example, you could look for themes like archaeology, modern history, architecture, parks, children activities, etc.

Or people planning to move from one place to another could key in specific data regarding information on schooling, age care, health care, work, etc to get an intelligent response back to where the best places are for those people to settle in relation to schools, healthcare and community facilities, transport and so on.

Businesses could find the best location in relation to the availability of the type of people they need, where the lowest rents are, the most prestigious sites, transport and so on.

Retail and trade applications that work both ways – for both the providers and the customers – are another area where AI is going to flourish over the next five years or so (the sharing economy).

This is the AI area that cities should look at in their transformation to a smart city. These AI products work well if there is an holistic strategy towards a smart city, as the applications will operate across the various silos on which most city bureaucracies are still based. Once a strategic plan is used to generate a much flatter structure, and to address the reluctance of bureaucrats to create an open government and open data platform, AI will be of great benefit in the running of a smart city and will create economic and social benefits for its citizens and businesses.

Paul Budde

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The pros and cons of municipality networks

Tuesday, December 29th, 2015

Given that there is now worldwide understanding that it is the cities that will lead many of the major developments in smart energy, smart transport, smart communications and so on, it is important to look at the reality of the push for smart cities.

In general it can be said that many of the smart city developments we have seen over the last decade have been developed in isolation, rather than within a holistic overall strategy. That is not a criticism – more of an observation. At the same time those who started early might have stumbled initially, but they are now well-advanced and ahead of the pack. But all councils/municipalities that are now embarking on smart cities will have to do so based on a sound strategic plan, as we have mentioned on several occasions.

If we look at cities that have been involved in the early developments we can make some of the following observations …..

Municipality broadband networks – well over 100 of them in America and a similar number of them in Europe  – were simply based on providing telecoms access as an alternative to the incumbent players who refused to provide first-class broadband. While there are good reports that this has been beneficial for the local citizens, very few other social and economic benefits were derived from these infrastructure projects. These projects did not have a holistic smart city vision at their heart – did not look for opportunities where the infrastructure could be used for other sectors (healthcare, education, transport, energy, etc). While in the USA most of the municipality networks have been, and still are being, installed by the local electricity companies, these companies have at least used the telecoms infrastructure for their own purposes as well (e.g. smart meters), however still not with the holistic view that we nowadays take in relation to ‘future energy’.

It is only now that cities have begun to realise that the infrastructure can be used for all of those other applications; unfortunately it was never taken into account when the municipality network was originally designed. In order to create a smart city literally tens of thousands of sensors linked to all sort of devices, construction elements, buildings, utility assets and so on are needed. This will require an integral design, with wireless networks (LTE, 5G, Wi-Fi), and a rethink of the use of the fibre network as a backbone network for a smart city.

On the energy side, cities are now actively pursuing renewables, energy efficiencies, battery storage, PVs and EVs, and the utilities simply can’t keep up with this because their ICT networks are not sufficiently up to scratch to make that happen. Furthermore it is extremely hard for them to develop the appropriate new business models, making sure that they get a return on their investments while at the same time maintaining the ageing infrastructure which is attracting less and less revenue.

These problems are worldwide and to date no one has come up with a good solution. It is, however, interesting to see that in some of the developing countries they are deciding against big grids and are simply building distributed systems only. They did the same thing in telecoms. They didn’t build fixed networks, concentrating instead on mobile, and in the case of Africa went from 4% telephone penetration to today’s 70%-plus within a decade. This is now stimulating investments in fibre-based backbone networks, and while it is hard to replicate this in developed economies we might at least be able to learn something from it.

However, those who haven’t even embarked on implementing intelligence and automation into their networks will be facing an uphill battle. For example, many utilities are still in that very early stage where they have hardly any visibility on what is happening in their network, and so are in no position to start talking to city authorities on how they can play a role in the development of a smart city. This is the case in New York City, where the local government has an excellent plan (NY Rev), but the question is whether their new energy vision can in fact be implemented. While they have the political leadership the current situation ‘on the ground’ is such that there are no easy solutions to put that plan into action.

There are also few or no incentives for the existing players to invest in new technologies without a clear understanding of what the return will be on their investment. Furthermore, there are conflicts of interest within the industry and around the possible business models aimed at bringing in new players and new investments, as the business model for that is not clear at all.

The new vision also challenges current and recently established policies and regulations, and while intuitively competition is a good thing, at the same time some parts of the economy are simply too difficult to open up, as in the end it is in the national interest to have a reliable national electricity system. So far nobody has solved this one.

However, others we have also reported on are already further advanced and are actually among the leaders in the smart city movement, seeing it as a new business opportunity. They are very much learning on the job and no doubt many mistakes will be made, but one thing is certain – these will be the winners and the survivors.

We also see cities making desperate pleas for FttH networks. The telcos are using their monopolistic powers to stop that from happening, and in the USA the dysfunctional political system in that country allows this. There is also a rethink now taking place among municipalities – moving their strategy away from providing an alternative telecoms service to looking at a broader use of new gigabit networks for the full smart city concept. But, here again, these new strategies are still in the early stages, with no real examples so far of cities that have developed the concept in a holistic way.

Another issue that needs to be addressed is city politics. Smart city policies need to be bipartisan. It is no use having the long-term plans in place if they are going to be demolished by short-term politics when a new council is elected. We have seen instances of this in cities that are paraded as shining examples of smart cities, such as Barcelona and Chattanooga. Again, the key to success is to put up a sound holistic strategic plan before you embark on smart city projects.

Finally, it is critical to address the financial issues. If cities are indeed becoming key in the implementation of, for example, the Paris Accords on climate change or the federal policies on clean energy, innovation, new job creation, renewables and so on, they also need to have access to the funds to do so, and to date this issue is nowhere near being resolved, certainly not in the western economies. Countries such as China, Singapore, Korea and Japan, as well as the Scandinavian countries, have far better collaboration in place between federal and city governments and the local industries involved in building smart cities. There are lessons to be learned here.

On a more positive note, at this stage all parties involved – cities, telcos, utilities and the broader industry – are increasingly coming to the understanding that they will have to collaborate in order to develop the smart cities that are needed to face the challenges of the future, be it creating new jobs in the sharing and networked economy, addressing traffic congestion and pollution, climate and environmental issues, energy efficiency, and generally creating liveable cities for its citizens and its businesses.

Paul Budde

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Israel telecoms undergoing major reform

Monday, December 28th, 2015

Israel’s telecoms sector is undergoing major transformation due to the recent introduction of new wholesale arrangements for its fixed-line infrastructure. This, combined with the entrance of additional mobile operators a few years ago, has created a much more competitive telecoms environment in Israel.

Israel’s fixed-line wholesale reforms came into effect early in 2015 and have increases competition in the fixed line voice and broadband sectors. Israel’s former Communications Minister approved the reforms in November 2014; allowing other operators to rent infrastructure from major players Bezeq and HOT Telecom and offer fixed services including television, Internet and fixed voice. It was hoped the reforms would reduce prices for customers and remove the need to acquire separate broadband connections and ISP accounts from different providers.

Both Bezeq and HOT Telecom have focused on improving network performance by deploying fibre in access networks, resulting in increasing average download speeds. Unsatisfied with the rate of progress, however, the government undertook to improve the quality of broadband service by establishing a public private partnership tasked with deploying an alternative fibre network. The venture is known as Unlimited.

The introduction of new mobile operators into the Israeli market a few years ago has taken its toll on the three existing operators. In 2015 Israel’s veteran mobile operators – Cellcom, Orange (Partner) and Pelephone continue to lose subscribers and market share to newer market entrants. Cellcom’s and Pelephone’s subscriber bases have been shrinking since 2011, while Orange’s began to decline in 2012. In an effort to turn around its fortunes, Cellcom recently entered the wholesale market and has started offering triple-play bundles. In addition it has launched its own TV services with content accessed by set-top box as well as on handheld mobile devices.

Other factors which have helped drive competition in Israel includes the establishment of full mobile number portability and regulatory barriers that prevent operators from linking sales of handsets to services, or offering discounts to customers that commit to longer periods. Strong competition has led to operators focusing on mobile data and content opportunities as well as on costs, resulting in a number of infrastructure sharing agreements.

For detailed information, table of contents and pricing see: Israel – Telecoms, Mobile and Broadband

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Denmark’s TDC to complete DOCSIS3.1 deployment by 2017

Thursday, December 24th, 2015

Denmark has benefited from a competitive telecom market which has led to the country having Europe’s highest broadband penetration rate and one of the highest penetration rates in the mobile sector. The fixed-line sector continues to lose revenue and customers as more people forego fixed phones for VoIP and mobile-only solutions.

Growth in the mobile market has been stimulated by consumer demand for data services, and this is set to continue strongly during the next few years as telcos are able to make use of additional spectrum in the 1800MHz band expected to be auctioned in 2016. In addition, the ITU’s November 2015 decision to set aside 700MHz digital dividend spectrum for mobile broadband will enable the regulator to auction these assets as well, so improving access to broadband in rural areas. All four main operators – TDC Mobile, Telenor Denmark, Telia and Hi3G – have launched LTE- Advanced services, and have deployed carrier aggregation technologies to make better use of their spectrum assets.

There is excellent cable and DSL infrastructure in place, and effective competition between the platforms in most areas. A progressive regulatory regime has encouraged operator access to both copper and fibre networks. Fibre has a fast-growing footprint. TDC’s network of vectored VDSL lines has been available to ISPs on a wholesale basis since early 2015. In addition, TDC is also investing in DOSCIS3.1 technology for its YouSee branded cable broadband offer. With the work expected to be completed in 2017, YouSee will provide a 1Gb/s data service to about 65% of premises in the country. These developments will help realise the government’s objective for all premises to have access to services of at least 100Mb/s by 2020.

This report introduces the key aspects of the Danish telecom market, presenting comprehensive data on the fixed network services sector and profiles of the major operators. It also analyses market statistics and assesses the key regulatory issues including interconnection, local loop unbundling, number portability and carrier preselection. In addition the report reviews the latest developments in the mobile voice and data markets, including an analysis of regulatory issues. The broadband market is analysed, with statistics on the DSL, cable and fibre sectors used as a basis for analysing the market’s developments and likely scenario to 2020.

For detailed information, table of contents and pricing see: Denmark – Telecoms, Mobile, Broadband and Digital Media – Statistics and Analyses

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4G LTE set to gain traction in 2016 in Thailand

Wednesday, December 23rd, 2015

A generally improved commercial environment has presented increased opportunities for the development of the internet in Thailand. Over the last decade, the estimated number of internet users in the country has increased more than fourfold. Internet user penetration reached 38% in 2015. ISPs have recovered from their earlier reputation for unreliable performance and a failure to invest in improved infrastructure; and the government has been fixing the regulatory regime.

The Thai telecom market is a complex commercial environment, with a mix of state-owned companies and private operators functioning under a wide variety of corporate and regulatory structures and interfaces. There are three major fixed-line operators – one government-owned and two private. Fixed-line services are outnumbered by mobile phone services by a ratio of more than 15 to one. While reasonably good infrastructure has been put in place to support data services, this segment of the market has only recently been experiencing significant growth.

What was once an all-powerful duopoly – AIS and DTAC – was still dominating the market despite the entry of a number of new players. Number three in the market, True Move, has been the only one to challenge the big two in any fashion, however. The market is still in need of regulatory change and the will to address this will be a big factor in shaping the future market.

The country has been making a strong push into broadband services. Fixed broadband penetration continues to grow slowly in Thailand reaching 30% household penetration in 2015. There have also been changes in the wireless broadband market with the roll-out of more 3G networks followed by 4G/LTE. Fibre-to-the-home (FTTH) continues to grow strongly in major metropolitan areas. In 2015 AIS commercially launched its residential fibre broadband service, ‘AIS Fibre’, offering connection speeds of up to 1Gbps via FTTH. In late 2015 the Provincial Electricity Authority announced the rollout of the country’s first smart grid electricity project, by early 2018.

The local mobile sector has seen a sustained period of high competition with heavy price-cutting as the battle for market share raged. There is likely to be a push for consolidation, especially as the market gets closer to saturation. The government’s sectoral reform should also have a major impact on the shape and direction of the market. Mobile subscriber penetration saw a significant fall in 2014/15 due to decline in subscriber growth by all operators, especially DTAC. 3G penetration continues to grow very strongly, with over 90% of subscribers now on 3G networks in 2015.

For detailed information, table of contents and pricing see: Thailand – Telecoms, Mobile and Broadband

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