Circuits to Packets - policy and regulation for the IP transition

CIRCUITS TO PACKETS ITU Telecom World Doha, 7th December 2014

MARTIN GEDDES FOUNDER & PRINCIPAL MARTIN GEDDES CONSULTING LTD

With annotations

What is this presentation

about?

Packets can mean voice

quality problems

1

Regulators have a role in

managing quality

2

It is time to consider new

commercial and technical models

3

1 2 3

Packets can mean

quality problems

1

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Phone calls:

basic facts

|9

IPX

High perceived

value The first application of

networks is usually voice, and take-up among

network users is typically close to 100%

|10

Failure is very visible

Even short failures are very obvious. The endowment effect means that losing the

quality level you have become accustomed to causes great dissatisfaction. This can create a

crisis of legitimacy for regulators.

|11

Low data volume

Everyone knows that voice doesn’t use much ‘bandwidth’, but that isn’t really the issue.

|12

High quality

need

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14/12/2014 | ©2014 Martin Geddes Consulting Ltd

Every application, including voice, has a ‘budget’ for quality.

Time

One part of the ‘budget’ is the end-to-end packet delay

Variability

The other is the amount of variability in loss and delay,

since even the cleverest software cannot adapt if this

is too high.

|16

Circuits

In the world of circuits, we reserve capacity for individual calls.

TDM circuits… (Time Division Multiplexing)

Zero Variability

You aren’t competing with other users, so you

experience total isolation from what everyone else is doing on the network.

…to packet-based statistical multiplexing

MORE DEMANDS ON OUR

‘TIME BUDGET’

2G, 3G, 4G OTT WiFi

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Packet world

More Variability

|22

So why use packets?

|23

Money is the answer, what is your question?

— Richard Shockey

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14/12/2014 | ©2014 Martin Geddes Consulting Ltd

Fill the silences

We long ago discovered we could pack in about 30% more

calls into a TDM circuit by filling the silences in our speech.

Intensify resource sharing

Packet networks take ‘fill the silences’ to its logical conclusion. It’s bit like taking a small

piece of land, and sharing it among many

people.

14/12/2014 26

Waiting time

This comes at a price: more waiting and variability.

|27

Examples of performance

problems

|28

BT 21CN VOICE

The UK incumbent operator spent a lot of money trying to replace circuits with packets for landline voice calls

FAILED Yet the project was infeasible from the

outset: they tried to fit the packet signalling within the timing constraints of the circuit

network, which was impossible.

|30

IPX

These are not isolated issues, but are endemic to our industry. Consider the

standard for quality-managed packet voice, IPX.

IPX Specification IR.34 v9.1§6.3.4

This does not specify a working phone call! The

average over a month could still allow for a 40 minute

period with 100% loss, and be compliant.

IPX performance and cost issues Why? Media and signalling are joined, which forces traffic the “long way”

?

Session Border Controllers

|34

De-jittering

De-jitter at every boundary

Because circuits have zero variability, we locally optimise to “low variability”.

|35

This creates the maximum

possible total packet delay.

|36

Result? Quality budget is

used up

|37

Everything fails under load. Why? No call admission control (CAC), so no graceful degradation.

Large European MNO’s enterprise converged voice service

|38

Unmanaged performance hazards Why? No schedulability limits in CAC.

(and every other UC vendor)

|39

VoLTE High cost of association management Why? It needs IMS

High cost of quality Why? Weak scheduling; waste in code space + backhaul

Limited revenue Why? Assurance only offered to telephony, not other apps

|40

VoLTE High cost of association management Why? It needs IMS

High cost of quality Why? Weak scheduling; waste in code space + backhaul

Limited revenue Why? Assurance only offered to telephony, not other apps

|41

VoLTE High cost of association management Why? It needs IMS

High cost of quality Why? Weak scheduling; waste in code space + backhaul

Limited revenue Why? Assurance only offered to telephony, not other apps

|42

Small cells Failure due to timing issues Why? Media, signalling, network control are on the same path. These lack isolation; have a coupled load; result is self-induced failure.

|43

Small cells Failure due to timing issues Why? Media, signalling, network control are on the same path. These lack isolation; have a coupled load; result is self-induced failure.

|44

Broadband voice Growing voice quality problems Why? Worsening “non-stationarity” QoS suffers from “quality inversion” AQM creates new failure hazards Clever voice codecs just add more delay

|45

Broadband voice Growing voice quality problems Why? Worsening “non-stationarity” QoS suffers from “quality inversion” AQM creates new failure hazards Clever voice codecs just add more delay

See “Networking and the Internet’s ‘global

warming’ problem”

|46

Broadband voice Growing voice quality problems Why? Worsening “non-stationarity” QoS suffers from “quality inversion” AQM creates new failure hazards Clever voice codecs just add more delay

See “The six challenges of selling QoS”

|47

Broadband voice Growing voice quality problems Why? Worsening “non-stationarity” QoS suffers from “quality inversion” AQM creates new failure hazards Clever voice codecs just add more delay

See “Why Active Queue Management should worry telco investors”

|48

Broadband voice Growing voice quality problems Why? Worsening “non-stationarity” QoS suffers from “quality inversion” AQM creates new failure hazards Clever voice codecs just add more delay

|49

DSL Lack of service continuity Why? ADSL – 30 sec retrain outages VDSL – frequent short retrains

|50

DSL Lack of service continuity Why? ADSL – 30 sec retrain outages VDSL – frequent short retrains

|51

Systemic risks

Going from 400+ to 6 switching centres with IP Transition: can

anyone model the performance risks in disaster situations?

(Answer: not really.)

|52

Why all these problems?

We’re trying to build network skyscrapers…

But we’re in the “digital medieval” period; the science

isn’t yet ready.

Result? Failure

under load

Statistical sharing = Variability

Source: Wikipedia/Imperial War Museum

It’s like when we moved to jet aircraft. We didn’t understand the dynamic loading properties of the

materials.

Source: Wikipedia/Krelnik

The result was catastrophic failure in operation. Passengers

were flying what were in effect experimental

aircraft. (SDN/NFV are experimental technologies being pushing

into deployment…)

|59

Why? Circuit thinking!

“Monoservice fallacy” The mistaken belief that

capacity and schedulability are the same thing.

|60

Two very common basic technical errors: More capacity solves schedulability problems. Average measures are what matter.

|61

Two very common basic technical errors: More capacity solves schedulability problems. Average measures are what matter.

|62

Two very common basic technical errors: More capacity solves schedulability problems. Average measures are what matter.

|63

IMS manages capacity constraints

not schedulability constraints You might want to

ask for your money back.

|64

This will get worse!

SDN/NFV create more variability

and aggregate failures.

|65

Current regulatory framework has no concept of

schedulability

Quality fraud

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14/12/2014 | ©2014 Martin Geddes Consulting Ltd

“Bad” network operators take the cash for delivering

voice, but will engage in “quality fraud”.

1 2 3

Regulators have a role in

managing quality

2

Future packet voice dystopia

|70

Sustainability trap International voice quality assurance market will become irrelevant Why? Price reductions due to no quality floor Performance crises needing more equipment OTT outperforms PSTN/PLMN

|71

Sustainability trap International voice quality assurance market will become irrelevant Why? Price reductions due to no quality floor Performance crises needing more equipment OTT outperforms PSTN/PLMN

|72

Sustainability trap International voice quality assurance market will become irrelevant Why? Price reductions due to no quality floor Performance crises needing more equipment OTT outperforms PSTN/PLMN

|73

Sustainability trap International voice quality assurance market will become irrelevant Why? Price reductions due to no quality floor Performance crises needing more equipment OTT outperforms PSTN/PLMN

|74

Economic crisis in voice market!

Costs can’t drop (due to market size and overheads)

but prices can!

|75

The OTT quality arbitrage is finite

So OTT can’t take up the

slack

Future packet voice utopia

|77

Sustainable growth

New revenue Quality floor and price floor established Wide range of assured services

Lower costs Decreased requirement to buy equipment

|78

Sustainable growth

New revenue Quality floor and price floor established Wide range of assured services

Lower costs Decreased requirement to buy equipment

THE BIG QUESTION!

How to get trustworthy services,

that are affordable, and enable innovation?

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So, what

to do?

|81

Understand packets!

“Translocation as a Service” (with contention) vs

Circuit fragment (without contention)

Need to understand

what the packet

service is!

4 REALITIES TO DEAL WITH 1. The business model will change 2. The media will shift from circuits 3. Your power is over the E164 numbering 4. The future value is in trusted services

4 REALITIES TO DEAL WITH 1. The business model will change 2. The media will shift from circuits 3. Your power is over the E164 numbering 4. The future value is in trusted services

4 REALITIES TO DEAL WITH 1. The business model will change 2. The media will shift from circuits 3. Your power is over the E164 numbering 4. The future value is in trusted services

4 REALITIES TO DEAL WITH 1. The business model will change 2. The media will shift from circuits 3. Your power is over the E164 numbering 4. The future value is in trusted services

4 REALITIES TO DEAL WITH 1. The business model will change 2. The media will shift from circuits 3. Your power is over the E164 numbering 4. The future value is in trusted services

|87

Issue: Retail Numbering

does not impose a quality requirement.

|88

Outcome-oriented policies

(not tied to implementation mechanisms)

Answer…

|89

Issue: Wholesale Can’t compose

quality along the supply chain.

|90

New market role: Translocation

assurance provider

Answer…

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14/12/2014 | ©2014 Martin Geddes Consulting Ltd

MEASURE QUALITY

Measure & enforce

The job of the ‘assurance’ provider

1 2 3

It is time to consider new

commercial and technical models

3

|94

Commercial approach

SET A PRICE FOR QUALITY

High Standard

Low

E164 NUMBERS • Your global trusted

brand for quality assurance

• You can’t control the media delivery…

• …so focus on preserving value in the numbering and signalling

E164 NUMBERS • Your global trusted

brand for quality assurance

• You can’t control the media delivery…

• …so focus on preserving value in the numbering and signalling

MARKET STRUCTURE

MEDIA

SIGNALLING

IDENTITY

The three basic jobs that get done in delivering phone

calls

TODAY’S REVENUE MODEL

MEDIA

SIGNALLING

IDENTITY

Minutes No billing for unanswered calls

No user charge for numbers

COST STRUCTURE

MEDIA

SIGNALLING

IDENTITY

Translocation costs

Association costs

Numbering costs

TODAY’S (RELATIVE) COSTS

MEDIA

SIGNALLING

IDENTITY

Falling fast

Falling slowly/rising

Fixed/rising

POSSIBLE FUTURE MODEL?

MEDIA

SIGNALLING

IDENTITY

Bill and keep

Charge for unanswered or rejected calls

Pigouvian tax

POSSIBLE FUTURE MODEL?

MEDIA

SIGNALLING

IDENTITY

Bill and keep

Charge for unanswered or rejected calls

Pigouvian tax Anti-spam

POSSIBLE FUTURE MODEL?

MEDIA

SIGNALLING

IDENTITY

Bill and keep

Charge for unanswered or rejected calls

Pigouvian tax

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Compensate for negative externalities

What is a Pigouvian tax?

THREE REGULATORY QUALITY LEVELS

Threshold

Target

Stretch

Basic conformance

Threshold

Target

Stretch

Lose number or license

Tax substandard services

Threshold

Target

Stretch

Pigouvian tax on numbering

Threshold

Target

Stretch

No tax

Tax substandard services

Drive market developments

Threshold

Target

Stretch

STRETCH QUALITY TARGET USES

1.Criteria for license renewal and setting price of license.

2.Trade SMP for higher quality. 3.Encourage development of

new markets.

STRETCH QUALITY TARGET USES

1.Criteria for license renewal and setting price of license.

2.Trade SMP for higher quality. 3.Encourage development of

new markets.

Significant market power

STRETCH QUALITY TARGET USES

1.Criteria for license renewal and setting price of license.

2.Trade SMP for higher quality. 3.Encourage development of

new markets. Such as higher definition, WebRTC assurance, video.

Offer quality assured and unassured number ranges

SOLVE “NET NEUTRALITY”

Fair and non-discriminatory pricing of quality is possible!

(How? Ask me!)

Technical approach

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Take control over the systemic

performance hazards (as operators and their

suppliers aren’t doing it)

FILL THE GAP IN STANDARDS FOR QUALITY

• The ITU needs to step up! • Provide scientific and thought

leadership • Create standards for composable

quality metrics that are a strong QoE proxy

THREE LAYER POLYSERVICE MODEL

Superior traffic costs more to deliver… so should attract a premium

Economy

Standard

Superior

Standard traffic is today’s off-peak Internet… but is consistently the same

Economy traffic does not drive capacity upgrades

Cost of 80 hours of voice/month?

25¢

(translocation cost only, based on UK cost metrics)

SUMMARY 1. Move the money! Identity and assurance is

where it will be. 2. Light touch on how services are delivered,

but a strong grip on what quality. 3. Pro-consumer and pro-citizen policies that

align with packet technical reality.

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