Amdocs Network Research: LTE Alone May be Unable to Ease the Wireless Capacity Crunch as Hotspots Get Hotter

Annual State of the RAN Report Shows LTE Hotspots Could Reach Full Capacity in 2-3 Years*; Increased Demand for Data Will Accelerate Small Cell Adoption and Carrier-Grade Wi-Fi


ST. LOUIS, Feb. 4, 2015 (GLOBE NEWSWIRE) -- Amdocs, the leading provider of customer experience solutions, today released new research into mobile traffic showing that the ever-increasing demand for data may exhaust the capacity of 4G/LTE network hotspots within the next two to three years*. The annual Amdocs State of the RAN research highlights the urgency for service providers to develop a "smart data" capacity strategy and prioritize investment where there is a demonstrated return on investment (ROI) and allocate capacity automatically and dynamically to maximize customer experience and profitability.

This year's report focuses on areas with high smartphone penetration – downtown/city centers and some of the world's major stadium events. These radio access network (RAN) "hotspots" are getting hotter as smartphone and other wireless devices proliferate and consumers take advantage of new technologies, including 4G/ LTE. The research is based on analysis of more than 25 million voice and data connections at some of the busiest network locations around the world in the past 12 months.

Key findings include:

  • Hotspots continue to get hotter: The top 20 percent of locations in cities account for 80 percent of all network traffic. This intense concentration of demand will accelerate the adoption of new network technologies, including the proliferation of small cells and the introduction of carrier-grade Wi-Fi to ease the burden.
  • LTE alone will not solve the problem: Per subscriber usage continues to grow; in many instances doubling over the last year. LTE is delivering increased network capacity by offloading as much as 50 percent of traffic from 3G networks but the ever-increasing demand for mobile data may exhaust this new capacity within 2-3 years*.
  • The RAN has the biggest impact on network customer experience: Eighty percent of dropped voice calls and more than 50 percent of data throughput issues originate in the RAN, which provides wireless mobile connection for phones and tablets and other devices, using a combination of technologies, including macro cells and small cells utilizing 3G, 4G and increasingly Wi-Fi for offload. Any improvements here will present a significant opportunity for service providers as 25- 40 percent of customer churn is network related.
  • Data demand is fueled by new devices and the "technorati" dominate consumption: The majority of network data usage is being driven by only 10 percent of subscribers – the "technorati." This segment of heavy data users consumes up to 10 times more data per session than the average user, comprising 80 percent of the overall network traffic. The ability to identify and address high-demand subscriber segments will be critical to managing scarce network capacity.
  • Social media and "second screens" dominate stadium events: Sporting and entertainment events already create significant surges in mobile data demand. During the event itself social media uploads and "second screens" (watching content on a mobile device at the same time) creates a double spike, increasing data sessions by up to 50 percent. Voice calls during events drops by up to 50 percent as fans concentrate on the action.

"This research shows that service providers are facing a multi-dimensional challenge – to provide ever-increasing network capacity, greater coverage and better quality, particularly in mobile hotspots," said Rebecca Prudhomme, vice president for product and solutions marketing at Amdocs. "The answer is no longer simply just about adding hardware – small cells and Wi-Fi will offer new options ‒ but to introduce smart solutions to prioritize investment and allocate resources automatically to maximize customer experience and profitability. Through the combination of Amdocs' vendor-agnostic RAN solutions, big data analytics and B/OSS market leadership, Amdocs enables service providers to deliver a dynamic quality of experience."

* Based on Amdocs' insights to RAN capacity at analyzed locations and considering Analysis Mason's expected 42.5% wireless network traffic CAGR: Wireless network traffic worldwide: forecasts and analysis 2014–2019, Analysis Mason

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About Amdocs

For more than 30 years, Amdocs has ensured service providers' success and embraced their biggest challenges. To win in the connected world, service providers rely on Amdocs to simplify the customer experience, harness the data explosion, stay ahead with new services and improve operational efficiency. The global company uniquely combines a market-leading BSS, OSS and network control and optimization product portfolio with value-driven professional services and managed services operations. With revenue of $3.6 billion in fiscal 2014, Amdocs and its more than 22,000 employees serve customers in over 80 countries.

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This press release includes information that constitutes forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995, including statements about Amdocs' growth and business results in future quarters. Although we believe the expectations reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurance that our expectations will be obtained or that any deviations will not be material. Such statements involve risks and uncertainties that may cause future results to differ from those anticipated. These risks include, but are not limited to, the effects of general economic conditions, Amdocs' ability to grow in the business markets that it serves, Amdocs' ability to successfully integrate acquired businesses, adverse effects of market competition, rapid technological shifts that may render the Company's products and services obsolete, potential loss of a major customer, our ability to develop long-term relationships with our customers, and risks associated with operating businesses in the international market. Amdocs may elect to update these forward-looking statements at some point in the future; however, the Company specifically disclaims any obligation to do so. These and other risks are discussed at greater length in the Company's filings with the Securities and Exchange Commission, including in our Annual Report on Form 20-F for the fiscal year ended September 30, 2014 filed on December 8, 2014.


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