CSL rolls out software-controlled upgrade from 2G to 3G
Tarek Robbiati: all of CSL's 2G and 3G services
on a single integrated network
If you want to see the future of fixed and mobile telecoms,
there's a good argument for going to Hong Kong. Fixed operators
such as City Telecom are delivering speeds up to one gigabit
into apartments for remarkably low prices, while mobile
networks are running some of the fastest HSPA+ networks in the
world and already preparing for the next generation of mobile
Tarek Robbiati heads CSL, one of the most innovative mobile
operators in what is the hugely competitive market of Hong
Kong. Robbiati, a former deputy CFO of Telstra, the Australian
incumbent, was given the additional role of running Telstra
International just days after Global Telecoms Business
The relationship with Telstra is close: the trademark for
Telstra's 3G network is Next G, and CSL used exactly the same
brand for its 3G network in Hong Kong. The main difference is
that the Australian network is supplied by Ericsson, and the
Hong Kong vendor is ZTE, which is based in Shenzhen, the
southern Chinese city just across the border.
Telstra closed down a CDMA network so it could up its 3G
network. In Hong Kong, CSL replaced its existing GSM network
with a single network that runs both 2G and 3G services.
"We overlaid the existing network, and then we migrated all
our customers seamlessly to the new network," says Robbiati.
"Then we shut down the old 2G network. Now all our 2G and 3G
services are on a single integrated network."
Though Hong Kong is relatively small the changeover involved
2,200 base station sites - in what is a hugely challenging
environment, with most of the population concentrated in
high-rise buildings around the harbour, and the rest scattered
across mountainous countryside.
The first stage of the process was in February-March 2009,
when the new network was launched. The single integrated
network was fully operational by the end of September. "We then
started the new leg of the network transformation," says
Robbiati. The company started to re-farm the 900 megahertz
bands, originally restricted to exclusively 2G, for 3G
services. "We were harnessing the power of SDR."
SDR means software-defined radio, which means the radios in
the base stations can be switched - under software control -
from 2G to 3G. "It has been talked about for some time, but no
one else was doing it until CSL," says Robbiati. "Now we have
2.6 million customers using it."
The beauty of using SDR mean that there was no construction
involved at all in re-farming the 900 megahertz channels for
3G. "The engineers did some fine tuning, but it was all done
with software," says Robbiati.
The benefit of using some 900 megahertz capacity is that it
has better indoor and outdoor coverage than the 2,100 megahertz
bands that typically carry 3G.
"Hong Kong is probably one of the most difficult places to
service," he says. "We have 3,000 buildings that are more than
30 storeys high - but only 6% of the surface area of Hong Kong
is built on."
He waved out of the window of the Grand Hyatt Hotel in
Wanchai, on the northern shore of the main island of Hong Kong.
"There are customers behind those mountains: we provide them
with 3G service."
So does the SDR technology allow CSL to move to LTE? Yes,
but there's no need for it yet, says Robbiati. "HSPA+ has a lot
of life yet. It's not over at all," he says. "It's just
beginning. It can be extended with software."
Yes, it's possible to move on to LTE, "but at the moment
there are no devices", he notes, adding that commercial
quantities of chipsets for terminals are unlikely before "the
end of 2010".
That means CSL is unwilling to roll out an LTE network so
soon after it's transformed 2G into a combined 2G/3G network.
"Why roll out the infrastructure if you don't need it?" he
In LTE terms, "the most progressive carrier in the world is
Verizon Wireless", he adds, but it is planning to use the 700
megahertz band, "which is highly suitable for a large country
like the US". Verizon Wireless is planning first services later
in 2010, but Robbiati expects it will be 2012-13 before the
technology takes off.
Devices and chips
"We are ready for a rollout of LTE. We can do it quickly -
but why? Because at the moment there are no devices."
LTE will need an all-IP backhaul network, "and a lot of
spectrum and a new network, but for us these are all
non-issues", he adds. "The only issues for us are the
availability of the chipset."
CSL licensed the Next G brand for its 3G network from
Telstra, and used a team of Telstra engineers to support its
own team during the build-up in early 2009.
Robbiati admits that by using different vendors - Ericsson
and ZTE - the Australian and Hong Kong operations of the group
are able to compare the performance of the suppliers'
equipment, "but I won't share that information with you", he
"ZTE was a natural choice for us as we are in China and the
research and development is 45 minutes across the border. If
anything is needed we cam draw on the resources."
And the results? "We are very pleased with the relationship.
This is the first SDR in the world, and Hong Kong is a very
competitive environment. Hong Kong consumers are sophisticated
and highly brand-conscious - more than in my home town of
Robbiati worked in Europe for more than 15 years, at
Accenture, Lehman Brothers and then Orange UK, before heading
to Australia to join Telstra to become deputy CFO in 2005.
Though he has a financial background, he has a keen sense
that marketing and technology are important. "Quality of
service is important, and very few players emphasise that. We
know that customers don't like dropped calls and slow speeds.
We want to emphasise network quality and quality of
CSL segments its customers and provides different brands for
each segment - including a corporate and business brand called
1010, "which has an 85% share of the corporate sector". There's
even a "no frills" brand, New World Mobility, "for those who
just want a mobile".
Meanwhile the transformation of the network gives CSL "a
great opportunity to upsell 2G customers to 3G", says Robbiati.
"The customer base is already very data rich." Already 35% of
the data revenue comes from non-SMS traffic. "People are used
to consuming services," he adds.
The company has a range of services - some of its own design
- that it offers to the market. "We want to make our offer
unique. We package content, and we deliver proprietary
applications and services, and we leverage third-party
For example, the company offers a bandwidth-on-demand
option. Customers can opt for HSPA speeds of 3.6 megabits a
second, 7.2 megabits or 21 megabits. "All the bundles are
unlimited, but you pay for speed."
There's a number of traditional content services, such as
news, stock prices and betting. "But we've introduced a set of
proprietary applications and services, such as a music
subscription. There's a flat rate to listen to as much music as
you want on your handset. And you can also access the music on
your PC in hifi quality." And there are movies and mobi-series,
TV productions designed for watching on a mobile phone.
CSL is "just mobile", says Robbiati. "But innovation in
wireless is just gigantic, and is overturning wireline," he
"The telecoms industry is complex and requires a lot of
investment." Mobile provides a better return on investment
because there is a shorter time to market. "There are some
things that are not easy to do with mobile on a massive scale -
such as high-definition content," he admits.
That's partly because the notebooks that many customers use
as terminals just not have a powerful enough processor for
movies. "The CPU is not fast enough and people complain the
video isn't working."
But that's probably a temporary issue: network speeds and
chip performance just improve with time. And before too long
there will no doubt be enough terminals on the market to
justify that investment in LTE. GTB
Group MD of Telstra International since late 2009 and CEO of
CSL since July 2007
Master of science in nuclear physics and electronics
engineering from École Nationale Supèrieure
d'Ingènieurs, Caen, France
Master of science in business administration from Institut
d'Administration des Enterprises, Caen, France
MBA from London Business School, UK
Senior manager at Accenture, UK
VP and senior equity research analyst with Lehman Brothers,
VP and head of corporate finance, Orange UK
Deputy CFO of Telstra, Australia
Appointed CEO of CSL, Telstra's mobile operation in Hong
Appointed group MD of Telstra International