Explosive consumer demand for mobile Internet and Cloud-based content throughout Asia has created widespread data bottlenecks, bandwidth shortages, and excessive data charges over terrestrial 4G/LTE mobile networks. The one-to-one unicast architecture of mobile networks is not designed for the highly asymmetric nature of consumer demand for video today, where 5% of Internet content typically accountsfor 80% of all downloads. Exacerbating the congestion is the linear-limited growth of cellular networks, which can only expand by getting more spectrum, building more cell sites, and waiting for more technological breakthroughs. When faced with the potentially thousand-fold increase in data traffic in the next 10 years, and the fact that billions of people in remote regions remain unconnected, this problem will need a new structural delivery solution.
Asymmetric consumption of content, illustrated:
One-to-one unicast architecture
The cellular networks of today are optimized for unicasting services (i.e., link-based one-to-one communications) and thus are inherently disadvantageous in massive contents delivery, especially in vehicle applications with stringent demands on volume capacity, cost effectiveness, ubiquitous coverage, and consistent quality of services (QoS). Given the exponential growth in mobile traffic, it is well established that the mobile bottleneck problem cannot be coped with using cellular infrastructure expansion alone – an entirely different network architecture must be introduced in order to exploit the unique characteristics of mobile multimedia contents.
Built upon the above principles and its past success in CMMB terrestrial broadcasting technologies, our team has developed the world’s first truly converged satellite-terrestrial & broadcast-unicast convergent network which can provide order-of-magnitude performance benefits in terms of system capacity, cost, and coverage for the mobile multimedia markets. Specifically, our solution involves a powerful L-band mobile broadcast satellite, Silkwave-1, that delivers nearly 100 Mbps of multimedia contents to an unlimited number of vehicle users over vast areas. Relative to existing network solutions, the CMMB satellite-terrestrial network is not only superior in data rate, coverage, and cost effectiveness, but also advantageous in service flexibility and the richness of its ecosystem.
Given the data and user growth described above, traditional network operators have three key choices: increase their spectrum, increase the efficiency of existing transmitters and equipment, or increase their number of transmitters.
Availability of additional spectrum is extremely scarce and furthermore comes at a great cost, so is not a viable option for mobile network operators. Furthermore, the absolute amount of spectrum is limited, hence this is not a long-term solution.
Boosting the efficiency of existing equipment (e.g. the move from 3G to LTE) is the most efficient way to enhance their networks, but is costly. Furthermore, owing to continuous upgrade cycles, this has a high probability of lowering returns, as good but lower capacity equipment is retired before it reaches the end of its economic life.
Operators have been significantly boosting their number of transmitting towers to increase capacity and reach. However, this increase has not kept pace with increases in subscriber numbers. As a result, the number of 3G subscribers per Base Transceiver Station (BTS) has increased almost four-fold in the past five years. Bandwidth is thus shared across a larger user base, leading to a deteriorating user experience.
Infrastructure in place for expansion
After the roll-out of service in China, all required infrastructure is in place for an international expansion. The three beams of Silkwave-1 will seamlessly cover west Asia such as India and Pakistan and Southeast Asia such as Indonesia, Malaysia, Thailand, Vietnam and the Philippines. The full operation in China will continue while expanding into other Asian markets. Silkwave-1 will have the capacity to offer full services to such markets with regional diversity through its beaming forming capabilities simultaneously, which is what CMMB Silkwave aims to capitalize on through its international expansion.
Highly replicable business model
The business model is easily replicable in new markets as CMMB Silkwave will benefit from the established device ecosystem and easily adaptable user interface and offering, enabling CMMB Silkwave to easily export the service to new markets. Being one of the largest manufacturers of electronics in the world, the Chinese device ecosystem has the scalability to easily meet the demand arising from international expansion.
Sustainable competitive advantage
Drawing on experience and contacts accumulated through operations in China, as well as support of the One-Belt-One-Road initiatives, CMMB Silkwave expects to easily be able to obtain necessary approvals, source relevant content and facilitate the receiving side of the service. CMMB Silkwave will have the exclusive spectrum rights as long as the satellite orbits are utilised, and holds the exclusive rights to the CMMB and Next-Generation broadcasting standard outside China.
Silk Road initiatives
Through China’s One-Belt-One-Road initiative, China provides financial and economic assistance to its neighbouring countries along the ancient route called the “Silk Road” as well as the maritime belt. A large number of the countries included in the initiative will be within the coverage of Silkwave-1, which lays the ground works for solid governmental support when venturing into new markets.
India, Indonesia and Africa are the priority markets for CMMB Vision, after China, given that they are within the coverage area of the satellite and are deemed very attractive for a digital multimedia broadcasting service. Both markets have large populations, high penetration of Internet multimedia use and are experiencing explosive growth in data traffic.
India has the world’s second largest population totalling 1,324 million people. National GDP has surpassed US$ 2.2 trillion and has risen by more than a trillion over the past two decades. In this process of economic growth, India has brought millions of citizens into a new and growing cohort called the emerging middle class . India’s telecom sector has substantial growth potential, especially compared to developed markets, given that 75% of the population has a mobile connection and only 11% are smartphone users . While LTE only covers about 2% of the population in India, 62% have access to 3G networks.
Indonesia is the world’s fourth most populated country with over 261 million people. The country has had strong economic growth over the past decade, and despite the relative slowdown in recent years, the development remains impressive . GDP stands at US$ 932 billion. The country has a strong track record in poverty reduction, more than halving the poverty rate since 1999 to 11.3% in 2014 . The telecom sector is well developed with mobile penetration of 127% and 26% of the population using smartphones . The 3G network covers 89% of the population, while the LTE network only covers 10% of the population.
Africa is the world's second-largest and second-most-populous continent (the first being Asia). At about 30.3 million km2 (11.7 million square miles) including adjacent islands, it covers 6% of Earth's total surface area and 20.4% of its total land area. With 1.2 billion people as of 2016, it accounts for about 16% of the world's human population. It contains 54 fully recognised sovereign states (countries), nine territories and two de facto independent states with limited or no recognition. Smartphone adoption is higher in the developed world at 65% in 2015 and projected to grow to 76%. However, the progression in the developing world is faster with an increase of 23 points from 40% in 2015 to 63%. Sub-Saharan Africa should reach a total of 540 million smartphones from 380 million at the end of 2015.