September 2009 Archives

xG Technology proclaimed in 2005 that they have a revolutionary technology which allows wireless broadband using unlicensed and licensed frequencies. They said they could build the equivalent to a WiMAX network without the need to spend a massive amount on spectrum auctions and moreover, their technology had better range than WiMAX.

It seemed too good to be true and after some years of waiting, the communications industry got impatient. After all, this revolutionary technology had the potential to change the way wireless networks are deployed. If it was real, where was it? Again, it seemed beyond what was possible and after time, even patient old me figured the story didn't add up. I even asked the company to show us the technology so we could set the record straight.

xG responded with an invitation for a visit a short while after.

I drove to xG Technology's Florida headquarters and met the management team and drilled them with questions. I was the first person from the outside to see the company's xMax technology in action and wanted to come back with an accurate story. Of course, I wanted to know what you want to know - are they going to change the wireless world or not? Are they going to give WiMAX and LTE a run for its money? Most importantly, I wanted to understand how it is possible for a company few have heard of to go up against the major wireless players and win - doing something in a different way.

The results of my questions can be summed up as follows... The company bit off more than it could chew in 1995 and should have waited before talking.

A discussion of xMax, frequencies used, etc



It is obvious now they underestimated the complexity of what they were trying to accomplish. xG had to develop a wireless technology in a noisy spectrum from scratch. This is far more difficult than developing technology in a licensed spectrum where interference is a relative afterthought. They had to build base stations, chips, test gear and even a phone. In the world of WiMAX you can purchase chips from one vendor, test systems from another and phones from other companies. Time to market in WiMAX is much shorter as an entire ecosystem is developing products which interoperate and interconnect with one another. Imagine building it all yourself in spectrum which most engineers will tell you is not usable.

When you realize the size, scope and you might even add lunacy of the undertaking, it makes sense that the company spent $100 million dollars developing it all. Moreover, while they have about 50 engineers today, they averaged about 30 during their corporate history. It does seem impossible when you think about it.

Now that we got that out of the way - on to some specifics about the solution.

What frequencies does it run on? Currently 902-928 MHz but it is software definable meaning the solution can potentially be used in white space situations as well.

I had a chance to see the digital and RF boards which end-user devices would incorporate. At this point they are 2-8 times as large as a comparable WiMAX chipset but I would expect them to come down in size over time and as they are produced in volume.

xG xMax digital and RF boards

Voice is transmitted over the network via SIP with header compression and other techniques which minimize latency, bandwidth use, etc. The company's first handset the TX60 has integrated WiFI.

TX60 with soon to be added flip antenna

Perhaps the most interesting stat is they estimate that 700 MHz spectrum costs about 12 times more than equivalent xMax coverage when you factor in the cost of the frequency auctions.

Mobile base switching center

I was further told that one of the company's customers Townes Tele-Communications, Inc. has a few towers and their 100 foot tower has a range of 2.5 miles while one at 350 feet in the air has 6-8 mile range and is superior in coverage area to the nearby GSM equipment.

Now for the real-world test. President and CTO Joe Bobier handed me a TX60 phone and told me they are still working on their battery management technology. This phone had none I was told.
 

With that we made a call and I started talking to the command center from a few feet away. The voice quality? It was good. As good as any cell phone for sure. We then went into the test vehicle which had a massive power inverter for laptops which run diagnostics on the phone in a real-world setting. The quality was still great.

xG Technology command center

 

We drove for 30-45 minutes and the voice quality never diminished except in one spot where everyone warned me voice quality would be a bit choppy. Generally There was no latency or anything which made you think you were talking on any phone which is inferior to what you may use today. I kept asking the people on the other end to count to ten when we were near overhead wires or in areas I suspected there would be poor reception. Other than the spot mentioned above, the quality never diminished.

Mobile testing in South Florida

As the test ran on, the phone got "fry an egg on me" hot and at some point the sound stopped working. The phone was still connected according to the laptop but you couldn't converse. We called once more and after a while the voice couldn't be heard again.

It is worth pointing out that the phone was plugged into the laptop which graphed its diagnostics and this meant the phone was charging and subsequently running hotter than it would have on batteries alone. It was as hot as early WiFi phones I had tested some years back and Joe suspected the heat was the issue with the phone. I have no reason to doubt this assertion.

In summary, it works. Was it a perfect demo? No. But they never are and when you compare this to what the wireless carriers have had years to perfect, you come away very impressed. There are lots of discussions we can have about noise floors in the 900 MHz spectrum and how the company deals with interference but they are beyond the scope of this article. Moreover, we drove around enough residential and commercial areas that I am satisfied that I experienced a real-world test.

Who is the target for this technology? Incumbents (playing in other areas) CLECs, cable companies, mobile operators, OEMs,content providers such as Google, MVNOs, etc.

What does it cost? Well for a cool $2 billion you could have 70% POP coverage for 452 metros or about 90% of the population of the US. This would include at least a megabit of bandwidth per channel.

I know what you are thinking. Can it scale? The answer of course is I don't know but any customer is going to test it out before they buy and the company knows this. In addition, the description of how xG lays out its channels leads me to believe they have thought this issue through well.

But in the end there is nothing like a real-world volume test to know for sure.

So was it worth the trip? Yes. Can xMax from xG Technology change the wireless world? Quite possibly. But before we go too far down this path it is worth mentioning that areas of coverage are exclusive meaning only one carrier can pick up each city or metro area. This is an important consideration for companies looking to become a next-gen wireless carrier.

For now I believe the question has been answered. At least for my demo, xMax worked well and is real. When you realize that this company may have found a way to take a frequency riddled with wireless garbage and turn it into a fully functioning wireless voice and data network you start to see how much of a game changer this could be for the wireless industry.

Skype has been doing a great job integrating with Asterisk, ShoreTel, Nortel, Cisco and others. It took years to get the ball rolling but now the momentum is strong and further shows just how serious the software-based phone company is about integrating with SMB and enterprise customers.

I spoke with Ian Robin Skype's Head of Commercial Development Business regarding the progress the company is making integrating with equipment providers and the channel.

The video below has the details.

Last week's most interesting tech news may just be the controversy brewing in the world of net neutrality where FCC Chairman Julius Genachowski is looking to extend these principles to wireless networks. To me it makes sense that all networks should embrace net neutrality and subsequently charge users accordingly. In other words if I want to stream infinite amounts of music and videos, I should be allowed to as I realize I have to pay for my greater than average usage. Currently I use Skype video on an EVDO wireless network when no broadband alternatives exist and I am always fearful my carrier will shut me down for doing so. Why? Because the terms of service of many wireless carriers forbid VoIP and restrict the amount of bandwidth used per month. I would rather pay a few dollars more per month for EVDO and not live in fear. Moreover, if I want to see my family on Skype, I prefer to see them at the highest resolution and best quality possible and it upsets me that deep packet inspection tools are used by carriers to slow "undesirable" net traffic and in turn potentially reduce the clarity of video calls.

When I purchased an iPhone a while back I wanted it purely for web browsing but AT&T forced me to purchase a voice plan which cost me more than $40/per month. Did I feel like I was being ripped off? Sure. But I knew the phone was subsidized and moreover I knew telecom rules, rates and regulations in the US have often defied logic. For many years it cost much more to call someone one town over than it did to call someone across the country. Local calls while generally free cost the carrier money. In the nineties a thriving international callback business was launched when people realized they could call into the US from an international number and hang up and let a computer call them back from the US where rates were far cheaper. This International callback space preceded the IP communications market but similar to VoIP, it looked for opportunities to reduce phone rates by playing on the inconsistencies in international telecom rates and regulations.

Carriers have to deal with these inconsistencies while trying to generate profit in a world where VoIP has wreaked havoc on their ability to make money. Thankfully the cellular market exists because if it didn't, AT&T would be a very different company - perhaps more similar to Kodak as it watches its monopoly (duopoly, etc) position erode.

Part of the reason the FCC is talking about net neutrality principles has to do with Apple denying Google Voice into the app store. As most journalists know,  you are better off getting information out of the CIA than you are out of Apple - when it doesn't want to comment that is. Google says Apple didn't approve of their application, Apple said it hasn't decided. I believe Apple realizes this application will cut into AT&T revenue, making it less feasible for it and other carriers to pay the hefty fees the iPhone commands from carriers. You may recall an application called Newber which was developed last year allowed the iPhone to have a second phone line and bypass calls which would normally ride on the AT&T wireless network. It should be no surprise that Apple didn't approve of this application either - or as they like to say about VoIP apps when the FCC asks, -- "We are still considering it."

But back to the Apple/Google or should I say AT&T/Google controversy? Recently AT&T happened to point out that Google Voice doesn't adhere to net neutrality principles because it doesn't allow calls to areas of the countries where termination rates are high. Actually AT&T has a good point and while many "free press" advocates are complaining that this is not an apples to apples comparison because Google is not a telephone company.

While this is true, Google is not an underdog and it is difficult to feel sorry for a company which has a monopoly on web searching. Moreover, this dominant position has allowed the company to help wipe out much of the newspaper and magazine business which many argue is reducing the quality of articles consumers have access to. Amazingly Google can give things away all day long without affecting its stock price. They build browsers, operating systems, applications, services and all the while they don't have to make money from any of it - their core search business fuels the destruction of value in countless industries. In fact blogger Flourian Seroussi thinks Google is dumping and feels they need to be brought to justice.

The reason the newspaper discussion above is relevant is because Google seems to thrive on destroying business models as it looks for new ways to potentially generate revenue. These moves are all considered to be positive for consumers but in the newspaper and magazine example, there is little money left for serious investigative reporting at these organizations. I wonder if Google continues down its desired path, will it also reduce AT&T's ability to invest in its network? Likewise for other carriers worldwide.

Remember that $40/month I paid AT&T above? Some of it went to reinvesting in a faster network. I may not like to pay it but I do realize carriers need to make profit.

So yes, if Google wants the world to be utopian and fair then it needs to connect to all numbers as well. The company argues that it shouldn't need to do this but I find the argument less than convincing. One of the things which has bothered me about Skype and now Google Voice is that they tell you they aren't cannibalizing carrier revenue because you need a phone line to leverage these services. What they are doing however is cannibalizing the carrier's ability to make money as long-distance is where the profit lies.

Andy Abramson reminds us that AT&T actually had a service called CallVantage which was years ahead of most all other VoIP players and he further explains that AT&T could be in a much different position if they didn't kill this product. To me it is obvious that when AT&T put back the old Ma Bell back together they realized they were in a monopolistic position to control traffic and it was far better to control the pipes and make money from information providers than it was to rely on other carriers to uphold net neutrality principles. So killing CallVantage made sense to them at the time.

The challenge to AT&T now is what happens if the femtocell market becomes essential to their future? These devices take cell traffic off 3G and 4G networks and funnel it through devices which are connected to broadband lines - similar to how WiFi telephony works via local access points.

In other words, perhaps AT&T will soon have to deal with net neutrality principles from an "information service" perspective - whether it wants to or not. And when it does, its perspective on net neutrality may begin to change.

There are no simple answers here but the ramifications wireless FCC changes could be tremendous, enabling consumers to take advantage of Google Voice on the iPhone today, perhaps at the expense of long-term investment in 4G networks worldwide.

As international outsourcing claims more jobs, two things happen - unemployment in developed nations increases and companies lower their costs. As sad as this is for now unemployed workers, it is a byproduct of automation - the internet and IP communications. Moreover it accelerates during recessions. In order for the trend to cease, the standard of living has to increase in developing nations to a point where it doesn't make sense to move jobs away from developed countries.

It seems evident that one of the results of the economic crisis of this past year is deflation/margin compression which while generally bad for the economy actually helps reduce the lure of developed nations as a place to hire.

In an article in the Asian Pacific Post, TMC Senior Contributing Editor Brendan Read who among other things is a major part of TMC's Customer Interaction Solutions magazine was quoted. Here is an excerpt:

Brendan B. Read writes on TMCnet that the reasons for moving call centres to the Philippines are all too familiar: cost cutting, reluctance to invest in new technologies, and, unsaid but all-too-real: a challenging economy and the popularity of web self-service.

"The moves are also the latest retrenchments of contact centers in Canada, due to and accelerated by a relatively strong Canadian dollar, pushed by commodity chiefly oil price rises, that has made it less competitive as a location," he explained.

What does scare me about this trend is that the current US administration hasn't mentioned how technology has changed the global landscape on hiring and competition. It seems discussing this trend and how to solve it should be at the top of the list of priorities. The Bush administration didn't mention it either but during the first seven years of this decade while jobs were being lost to other countries, housing and finance employment related to a housing/debt bubble took their place.

Now however we are left with increasing unemployment and I fear developed countries will not see rapid job creation until the global standard of living reaches approximate equilibrium.

Having said that, the Obama administration needs to address these challenges head-on as the need for a President to ensure he provides an environment where citizens can find jobs is probably the most important priority after ensuring public safety. Sure, fixing health insurance is great but I just have trouble understanding how it is a more important priority than making sure we reduce unemployment in the US.

I guess what I am wondering about specifically is where is the employment tax credit which was discussed during the campaign? Moreover, why are all people out of work not forced to take career training - to better themselves in some way (every way)? I can understand if a person can document that they are on five interviews a day - perhaps they have no time to be trained but for all other able-bodied citizens receiving any government assistance, it is obvious they need training - in computers, foreign languages, science, selling on eBay, whatever will help them generate income.

I realize these topics are beyond my usual scope but it is the technology discussed in TMC publications, my blog and TMCnet which has enabled a massive transformation in the way the world employs people and I hope the thoughts outlined above are implemented so we can ensure that developed nations have the most employable and best-trained workforce possible.

I truly beleive it is irresponsible to discuss technology without discussing solutions to the problems these advancements can create for society.

I should end this post by expressing dismay that every US administration doles out taxpayer dollars to so many who are underprivileged without pushing those people to be as employable as possible. After all, if you give a person a fish they eat for a day, teach them to fish and they eat for a lifetime.

In the year 2000 when society was in the midst of realizing how technology and the internet in particular was going to change the world, I noticed there was a need by companies and carriers to better understand the hosted communications space. There were a number of companies with very compelling business models being launched such as Congruency, the early pioneer and leader of the communication ASP movement.

Shortly after realizing the need for education in the market, TMC launched a magazine titled Communications ASP. The magazine was a hit with advertisers and readers for about six months until the VC community and the tech market as a whole seemed to turn on the term ASP" I haven't a clue to this day why the acronym wasn't accepted but it seemed to get lumped in with other technologies which were left for dead but emerged later - like "ecommerce," "VoIP" and others.

Suffice it say this publication and dozens of companies in the space were sentenced to death when funding was cut off by investors. I credit Marc Benioff, the founder of Salesforce.com, for defying gravity and keeping his ASP and the entire movement going.

This leading hosted CRM company showed Wall Street that the ASP model was a good one and now we take for granted that hosted communications and hosted everything else is something the market needs - especially in a slow economy. But now we call it "cloud-based" computing or "hosted" or "on-demand" or whatever seems to be trendy at the moment.

I was thinking about the history of ASPs during a meeting with Evolve IP's Scott Kinka, the senior vice president of network services. Kinka's company supplies hosted voice, security, UC and messaging services to companies in the U.S. During our conversation he kept mentioning call center wins and how companies are embracing hosted contact center solutions.

He in turn referenced Paul Adams, the director of product management for enhanced services at Broadsoft, the company supplying Evolve IP with equipment which allows their company to in turn provide services to their SMB, enterprise and call center customers.

I know Broadsoft very well as a major player in IP communications - their BroadWorks platform is a vital cog in the carrier machine of providing services for customers.

During a recent conversation with Adams, I asked about the company's call center strategy and he explained that they added contact center functionality about three to four years ago, and since that time they have been adding features, allowing the product to support more formal and larger centers.

Recently BroadWorks 16 expanded contact center functionality even more with the above trend being adhered to. I asked him how his company's products compare to premise or CPE equipment and he explained they are competitive with many hosted solutions but aren't focusing on the high-end centers where their needs to be a focus on blending (inbound and outbound agents coordinating calls) and multichannel routing. Interestingly, Scott goes into the sales process explaining this limitation upfront and it hasn't been a barrier to winning large deals, which he says are in the 400- to 500-seat range.

One of the advantages Broadsoft brings to the table is its integration with UC solutions and FMC. You see, Broadsoft's  end-customers get to take advantage of the latest in numerous technologies and they get it all integrated into their contact center solution.

And as agents become more informal and mobile, the company's ability to track calls while they are connected, including hold times, etc. mean that reporting becomes more accurate and call center management becomes more detailed and effective.

BroadWorks 17 is the next version in the pipeline and we can expect it to have enhanced reporting and ACD functions. A while back, Broadsoft purchased competitor Sylantro to pretty much become the 800-pound gorilla in the space. As the company continues to innovate and roll out new products, it can instantaneously upgrade the world's hosted contact center solutions provided by carriers. This is great for customers and yet another challenge for CPE vendors. But it seems there is still room to innovate on the high-end where Broadworks is not looking to compete - at least for now.

In the past few days I have run into two Blackberry Tour users. One had positive things to say and one terrible things. Om Malik sums up the problems. In short, Om got his social circle to switch to the device and then ended up with egg on his face as it failed to perform adequately for his friends. Let's keep in mind Apple has one platform for their smartphones and it still has problems - even after a few generations. In fact the company is looking to fix a battery drain problem as you read this. What do you expect from RIM, Nokia, Samsung, HTC and others?

If there is a silver lining here it is that the Tour seems like it has the right specs and if the bugs get worked out, the next gen device should be much better. I heard similar complaints which led to praise about the Storm. And it is not like RIM is a novice in this space - they are a major smartphone force with over a decade of solid experience. That's what makes these missteps so surprising to me.

For smartphone companies there is obviously tremendous pressure to get to market quickly but it seems obvious to me the negative press surrounding buggy launches makes it risky business to introduce  a less than perfect consumer electronics product.

I had a meeting with Jiri Kuthan AVP Engineering of Tekelec regarding some of the challenges his company sees in the communications and technology markets. The first is security which he says is an underappreciated topic. One point he made was that operators are beginning to think more systematically about SBCs. They aren't just throwing boxes at their problems anymore as he says but instead they are beginning to focus on systematically improving their security policies and procedures.

He is not discounting the importance of the SBC, just explaining there is more to it than adding equipment to handle the problem.

Another point he made was that identity or lack of it is a problem online. Jiri said, "How many calls did I receive which were anonymous which were of use to me." He continued, "Anonymity is a perfect vehicle for annoyance, spam, fraud, security attacks."

He went on to explain that there are numerous political and technical issues which come up - specifically, privacy protection vs. identity exposure.

We didn't go into much detail beyond these concerns but I hope to have my team work even more closely with Tekelec going forward so we can share solutions to some of the problems outlined above.

Leveraging Ecosystems Eclipses Developing Products

Widgets for TVs, application stores for wireless phones, applets for the connected home and automobiles... The trend is clear as smart ecosystems have emerged on the scene as a new way to generate revenue while locking in customers to specific hardware/software solutions. For many manufacturers such as Avaya, Cisco, RIM, Nokia, Apple and makers of televisions, it is no longer adequate to focus exclusively on the products your company develops. Now you have to figure out how to build a smart ecosystem around your offerings in order to leverage an able and willing (hardware and software) developer community who will evangelize your platform and develop long-tail applications, services and add-ons which boost the value of your ecosystem.

In order to help educate the emerging smart ecosystem community, TMC has partnered with Crossfire Media and distinguished college professor Mary Cronin PhD to launch a smart ecosystem portal containing news, thought leadership and analysis called SPEC which stands for Smart Product Ecosystems Connection and located at www.specosys.com.

As you may recall, Crossfire Media is home to Carl Ford and together we have already partnered to build online and live communities (4GWE and M2M Summit) in the 4G and M2M spaces.

This partnership also includes Mary Cronin, a professor in the Information Systems Department of Boston College's Carroll School of Management. Mary is a true thought leader in the space and you can expect to hear her prescient thoughts on how ecosystems will take root and evolve. Her first article is titled Five Rules for Smart Product Ecosystems.

The coverage areas will extend into a variety of industries and for now they include Telecom & Mobile; Health & Medical; Automotive & Telematics; Home Automation and Connected Home Entertainment Devices; Energy Monitoring and Personal Energy Management Solutions. We are open to adding new areas so drop us a line with suggestions.

It is evident that as time goes on, companies in all industries will be looking to tie their products and services into more and more ecosystems. They will either develop their own and/or leverage others on the market. In order to stay up to date on the investment, partnering and other opportunities ahead, be sure to bookmark the new SPEC smart ecosystem site and check back often.