Evolve to richer voice with Voice over LTE (VoLTE)

Winning the revenue advantage with LTE smartphones

NSN White paper November 2013

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CONTENTS

Voice will become data 3

Executive summary 3

1. Why implement VoLTE 4

2. VoLTEofferskeyadvantagesinfourmainareas 6

3. How to evolve to VoLTE: Approaches to consider 10

4. OptionsforprovidingvoiceservicestoLTEsmartphonesubscribers

12

5. VoLTEsolution:PartofNSNLiquidNet 14

6. Conclusion 15

Glossaryofabbreviations 15

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Voice will become dataTheadoptionofLTEisfollowingtheexampleof3Ginearlythe2000s,butatamuchfasterrate.ForoperatorsevolvingtoLTE,providingvoiceononenetworkanddataonanotherdoesnotmakefinancialsense.Instead,voiceissettobecomeanintegralpartofLTEasitistodaywith2Gand3G.Asthisevolutioncontinues,LTEandVoiceoverLTE(VoLTE)arebecomingthemainstreamtechnologyandby2016,VoLTEwillaccountaround10%ofallLTEsubscriptions.

TheimplementationofVoiceofOverLTE(VoLTE)willhavefar-reachingimplicationsandwillbringmanyadvantagesforoperators,includinghigherefficiencyandlowercosts.Asvoicebecomesdata,VoLTEwillenablearichmultimediavoiceexperience,helpingtoimprovethecompetitivepositionofoperatorsagainstOTTplayers.

TheevolutiontoVoLTEwillproceeddownseveralpaths,withboththetechnologychoicesandtimingdependentonexistingtechnologies,thespectrumavailable,currentandfuturevoicestrategies,andlocalmarketconditions.AsoperatorsdecideontheappropriateLTEstrategy,whethertooptforhotspotsornationwidecoverage,forexample,theyarealsochoosingtheirapproachtoVoLTE.Insomecases,theywillstarttheirevolutiontoVoLTEwithCircuitSwitchedFallback(CSFB)andoncehavenationwideLTEcoverage,theywillimplementfull-fledgedVoLTEservice.Makingtheoptimumchoicewillbecrucialtocompetesuccessfullyinanenvironmentwherechangeisthe only constant and subscriber expectations will only increase.

• WhyimplementVoLTE? Explosive demand combined with increasing pricepressureandcompetitionfromOTTplayersaredrivingtheevolutiontoLTE,which opens up new business opportunities foroperatorsandhelpsthemimprovethecustomer experience.

• Whatarethetimelinesfortheintroduction ofVoLTE?

ThemassmarketintroductionofLTEsmartphoneshasbegun,andby2016VoLTEisprojectedtoaccountfor10%ofallLTEsubscriptions.

• WhatarethekeyadvantagesofVoLTE? VoLTEsupportshigherspectralefficiency,OPEXsavingsfromconsolidationandoptimization,bettervoicecallquality,and

newopportunitiesformoresophisticatedvoice-basedservices.

• WhatarethemainfactorsbehindthedecisiontoimplementVoLTE?

WhenoperatorsaremakingthedecisiontoimplementVoLTE,thereareseveralkeyfactorstobearinmind,includingtheirexistingmobiletechnology,theLTEspectrumandcoverageavailable,localmarketandcompetitiveconditions and their business objectives.

• WhatarethemainapproachestoimplementingVoLTE?

OperatorscanimplementfullIMSVoLTEandmultimedia,startwithCSFBforvoiceandIMSformultimedia,orrelyonCSFBoverthelongertermandtargetLTEfordata.

• VoLTEfromNokiaSolutionsandNetworks(NSN)

Executive summary

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1. Why implement VoLTEExplosivedemandfordata,greaterdemandforquality,andintensepricecompetitionarethreegoodreasonsforadoptingVoLTE.Capacityneedsareprojectedtoincrease1000-foldby2020asaveragedailyusagerisesto1GB.Atthesametime,marketdevelopmentssuchasOTTvoicearesqueezingprice-per-minuteandputtingunprecedentedpressureoncosts.Fortheirpart,subscribersincreasinglywantfaster,morereliableandricherservices,andtheyarereadyandwillingtoswapproviderstogetwhattheywant.Some40%ofhighvaluecustomersarelikelytochangeoperatorsinthenext12months.

Theseescalatingdemandsaredrivingtheintroductionofhigh-capacity,all-IPnetworks,withLTEprovidingtheradioaccessformobileconnectivity.AsLTEsmartphonescomeonthemarketandmore high-bandwidthapplicationssuchasHDvideoareintroduced,thesetrends will only accelerate.

Asthefirstradiotechnologythatisfullypacket-based,LTEprovidesfasteraccessratesandlowerlatency,aswellasenablingoperatorstoenjoyalowercost-per-transmitted-bitbyusingnetworkresourcesmoreefficiently.LTEisthekeytoprovidingcost-effectivecapacitytocatertogrowingdemandforhigh-bandwidthservicessuchasmobilevideo.

BySeptember2012,morethan290operatorshadcommittedtoLTEin93countriesandmorethan90commercialnetworkswereupandrunning.Infact,LTEis“thefastestdevelopingmobilesystemtechnologyever,”saystheGSA.

1.1 LTE provides the foundation for richer voice and data services

LTE-basedall-IPnetworksopenupopportunitiestointroducenewbusinessmodels,offerricherservicesandenhancebusinessperformance.Theyalsomakeitpossibletoimprovethecustomerexperiencewithvoiceservices,whichisatoppriorityofmanyoperators.DuringtherecentlaunchofVoLTEinKorea,forexample,operatorsSKTandLGU+stressedsuperiorvoicequalityintheirmarketingcampaigns.Asvoiceservicesarethedominantsourceofrevenueformobileoperators,accountingforaround60%oftheirtotalrevenue,thereiseveryreasontoensureapositiveexperience.Goingforward,VoiceoverLTE(VoLTE)isthelogicalchoicetoprovidehigh-qualityvoiceservices over the same technology that is driving the data revolution.

1.2 VoLTE subscriptions will grow in parallel with LTE

OnceVoLTEcapablesmartphonesareintroducedonamassmarketscale,whichiswidelyexpectedin2013,thenumberofVoLTEsubscriptionsandtheintroductionofVoLTEservicesonLTEnetworks

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areprojectedtogrowquickly.ARCchartpredictedinMay2012thattherewillbeasmanyas74millionVoLTE-enabledsubscribersbytheendof2016,representingapproximately10%ofallLTEsubscriptions.

Takingintoaccountrevenue,qualityandOPEXdrivers,VoLTEistherighttechnologychoiceforoperatorstomaintaintheirexistingrevenuesandmoresignificantlytoenablenewbusinessopportunities(seesection2).TheunderlyingquestionisnotwhethertoimplementVoLTE,buthowandwhen,whichisdiscussedinsection3.

Phone / technology

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Figure1:Althoughvoicerevenueisprojectedtodeclineslightly,itwillcontinuetobesignificant.(InfoneticsJune13.2012)

Figure2:LTEphoneuptakewillgrowsteadilyastheLTErolloutcontinues.(YankeeGroup2012)

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2.   VoLTE offers key advantages in four main areas

VoLTE will typically be adopted in parallel with CS voice with a gradual transitiontoIMSVoLTE.ThetimingofthetransitionwillbecrucialforoperatorstoavoidlosingouttoOTTplayersandtakefulladvantage oftheadvantagesofVoLTE,whichcoverfourmainareas:

• Spectralefficiency:Spectrumrefarmingmakesitpossibletosignificantlyreducedeploymentcostsandhandletwiceasmanycalls with the same spectrum.

• Reuseofexisting2Gand3Gspectrumreducestheneedfornewspectrum

• Significantreductionindeploymentcostscomparedwithspectrum purchase

• Networkandplanningoptimizationcutscostsandenables future-proofnetworkmodernization

• Bettervoicecallquality:Shorterdelaysandfastercallset-uptimes improve the customer experience

• Richervoice:Creatingamultimediaenvironmentthatincludesvoice enables competition with OTT players

2.1  Higher spectral efficiencyImprovedspectralefficiencymakesitpossibleforVoLTEtohandletwiceasmanycalls,helpingtooptimizetheuseofradioresourcesandreducecosts.LTEofferstwicethespectralefficiencyof3G/HSPAandmorethan6timestheefficiencyofthelatestGSMtechnology.Thisfreesupmorecapacityfordata,whichinsomenetworksalreadyoutpacesvoicevolumebyafactorof50-100.AsbothdatavolumesandLTEdevicepenetrationgrow,spectralefficiencytocarrymorevoicewithlessbandwidthwillbecomeakeyadvantage.

ItispossibletousenewfrequenciesforVoLTE.Regulatorshavereallocatedinmanymarketsnewlowerfrequencybands(700,800MHz,oftencalled“digitaldividend”)whichcannowbeusedforLTE.BecauseoftheirgoodcoveragecharacteristicsthesefrequenciesareextremelysuitableforLTEvoiceimplementations.

Re-farmingfurtherimprovesspectralefficiency.WhenoperatorsintroducenewtechnologylikeLTEonthesamefrequencyspectrumtheyareusingfor3G,forexample,theycanrefarmthespectrumtouseitmoreefficiently.

Spectralefficiency Simplification Voicequality Richervoice

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2.2  SimplificationConsolidationisthekeytoOPEXsavingswithVoLTE.ByintegratingthevoiceanddatadomainsonthesameLTEnetwork,operatorscansignificantlyreducetheiroperatingcosts.Theintegrationofnetworkresources,theoptimizationofnetworkandservicemanagement,andthesimplificationofservicedeliveryallhelptoreducecosts.

Byrelyingononeradiotechnologyandusingre-farming,operatorscan adopt smart spectrum allocation to reuse existing spectrum andreduceoperationalcostsfortheradionetwork.Inaddition,transitioningtofullall-IPtechnologyresultsinsignificantsavingsontransmission costs.

Accordingtoourcalculations,theconsolidationofthecorenetworkenablesfurthercostbenefits:60%loweroperations&maintenancecosts,75%lowersitesupportcostsand65%lowerenergycosts.

2.3 Better voice call qualityThelowlatencyofLTEprovidesclearbenefitsforVoLTE.Shorterdelaysandfastercallset-uptimesenablehighqualityvoiceanddataconnections,helpingtoimprovethecustomerexperience.HighDefinition(HD)voiceisthedefaultwithVoLTE,andaspastexperiencehasshown,improvedqualityencourageslongertalktimeandreduceschurn.MuchlowerdelayandhighcapacityalsoenableHDvideoqualityforvideocalls,andthecallset-uptimerequiredforswitchingbetween communication methods such as chat and voice is much shorter.

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Figure3:LTEofferstwicethespectralefficiencyof3G/HSPA

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Internet-basedVoIPservicestendtogenerateagreaterloadonmobilenetworks,whichhasanadverseeffectonquality.BecauseOTTvoiceappstypicallyusemorenetworkresources,operatorsneedtoinvestinmorecapacitytohandleOTTvoicetraffic.Inaddition,thequalityofOTTvoiceisoftenvariable,andoperatorsenjoyanadvantageherebecausesubscribersoftenconsidertheirmobilevoiceservices more reliable.

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Figure4:RefarmingLTEtocurrentvoicefrequency

Figure5:Internet-basedVoIPservicesgenerateahigherloadonmobilenetworks.

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2.4 Richer voiceVoLTEandRichCommunicationsService(RCS)arebasedonthe sameIPMultimediasubsystem(IMS),soVoLTEismuchmorethatanIP-basedvariantofexistingCSmobileservice.Byenablingsophisticatedvoice-basedservices,itoffersnewrevenuepotentialas well as a customer experience that cannot be matched by OTT providersorCS-basedvoiceservicesalone.IMS-basedVoLTEsupportsanRCSmultimediaserviceportfolio,includingprivacy,buddylists,presence,videoshare,videocall,multimediamessaging,chat,filetransfer,andmanymore.

Someoftheseservices,inparticulartheonesincludedinRCS-e,orenhanced,werelaunchedrecentlyinSpain.RCS/RCS-earebothbasedonIMS,whichenablesafastlaunchofrichVoLTEserviceswhensufficientLTEcoverageisavailable.

ByimplementingVoLTE,operatorscantakefulladvantageofthecapabilitiesofsmartphonesthathaveanRCSclient.Allservicecapabilitiesareavailablebydefault,whichmakesitmucheasierforsubscriberstofindandselectattractivenewservices,significantlyloweringthethresholdforadoptingthem.WithOTTvoiceservices,subscribersneedtodownloaddefinedOTTclientsoftwareandselecttheservice.Thiscanbeaninvolvedprocessthatmanywillforget orforgo.

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3. How to evolve to VoLTE: Approaches to consider

The evolution to VoLTE is a process that can be made in several stepsandimplementedinseveralways.Someoperatorswillmakethedecisiontooffer,eitherinitiallyoroverthelongerterm,acombinationofCSvoiceandLTEdataonLTEdevices.Eventually,however,therevenue-generatingopportunitiesfromenrichedvoiceservicesforLTEsmartphonesarelikelytobesocompellingthatmost,ifnotall,operatorswilladoptfullIMS-basedVoLTE.Providingvoiceanddatasimultaneouslyoverthesamenetworkwillallowoperators to ensure an optimal customer experience.

ThefactorsaffectingthischoiceaswellasthepaceofdeploymentofVoLTEwilldependontheexistingmobiletechnology,whether2G/3G/HSPAorCDMA;theLTEspectrumavailableinagivenlocation,whichwillhaveanimpactofLTErolloutandcoverage;localmarketconditions;andtheoperator’sbusinessobjectives,whethertosticktobasicvoiceandsmsservicesorofferadvancedservices.Takingallthesefactorsintoaccount,therearethreemainapproachestointroducingvoiceservicesforLTEsubscribers:

• ImplementIMSVoLTEandmultimedia. The target with this approachisanall-IParchitectureandadvancedservices.Withthisapproach,3Gcoverageand/orcapacityareinadequatetoprovidethelevelofservicerequired,andLTEcoverageisalreadygoodandgrowingfast.

• ImplementCSFBforvoiceandIMSformultimedia,e.g.RCS in the initial stage and evolve to VoLTE when LTE coverage is nationwide. Thisapproachrequiresgood3Gcoverageandcapacityandsupportsastrategyofofferingadvancedservices.LTEcanbeused to provide extra data capacity in congested areas.

• ImplementCSFBoverthelongterm and evolve to VoLTE only whenthemarketdemandsit.Inthiscase,thereisnorequirementtogobeyondvoice,SMSandbasicdata.LTEcoverageislimited,andLTEistargetedonlyfordata.NationwideCScoverageisbasedmainly on 2G.

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The most common way to introduce voice service in early phase oftheLTEisCSFB,whichcanbeusedalsoforroamingaslongasnecessary.InCDMAmarkets,suchasNorthAmericaandJapan,CDMAoperatorsarerollingoutLTEandforexampleofferingCDMAvoicewithSimultaneousVoiceandLTE(SVLTE).FirstcommercialIMSVoLTEnetworkshavebeenlaunchedinSouth-KoreaandUS.InothermarketscommerciallaunchofIMSVoLTEisexpectedin2013andonwards.

Coverage evolution VoLTE implementation Market situation

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Figure6:Factsaffectingchoiceandtimingofoperator’sVoLTEdeployment

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4. Options for providing voice services to LTE smartphone subscribers

Asdescribedabove,thereareseveraldifferentoptions,basedoneitherCS,CSFBorfullVoLTEtechnology,forprovidingvoiceservicesto LTE smartphone subscribers.

4.1 Use CS technologies to provide voiceCSvoicemakestheintroductionofvoiceservicesinanLTEenvironmentfastandeasyasitisbasedontheoperator’sexistingvoicecoreenvironment.ThefirstLTE-capablesmartphonesalreadysupportvoicewithCSanddatawithLTE,andthusenableabridgetowards LTE.

4.1.1 Implement Simultaneous Voice and LTEWhenLTEisanoverlaytoaCDMAnetwork,thecurrentapproachtodeliveringvoiceisSimultaneousVoiceandLTE(SVLTE).Inthiscase,voiceserviceisdeployedasaCDMACSvoiceservicerunninginparallelwithLTEdataservices.Thissolutionisenabledbydual-modehandsetsandnoadditionalnetworkfunctionalityisneeded.Dual-mode handsets can conduct simultaneous LTE data sessions and legacy voice calls.

4.1.2   Use Circuit Switched Fall Back (CSFB) as a bridging technology to VoLTE

Withthisapproach,CSFBestablishesasignallingchannelbetweenthecircuit-switchedvoicecore(MobileSoftSwitch)andtheMobilityManagementEntity(MME)intheLTEpacketcorenetwork(EvolvedPacketCore).Thisallowshandsetsattachedtothepacket-switchedLTEnetworktochangeovertoaCSnetworkforincomingandoutgoing voice calls. Ongoing data sessions in LTE will also switch overto3G/HSPAnetwork,andwhenthevoicecallsends,thehandsetreturnstoLTE.SMSmessagesaredelivereddirectlyoverthesignallinglink,sonofallbackmechanismisrequired.

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4.2 Implement IMS-based VoLTEVoLTEputsIMSattheheartofthevoicecorenetwork,managingtheconnectivitybetweensubscribersandtheimplementationofpolicy control. The Telephony Application Server (TAS) manages voice servicesandsupplementaryservicessuchascallforwarding,callwaitandcalltransfer.

IMS-basedVoLTEalsoenablesaRichCommunicationsServices(RCS)offering.Foroperatorsrunningbothfixedandmobilenetworks,aVoLTEsolutioncanbringfurthervaluebyenablingasinglevoicesolutionforboththefixedandmobiledomainsandmakingitpossibletocreateaunifiedvoicecoresolutionthatprovidesserviceforallaccess domains.

4.2.1  Deploy VoLTE without full LTE network coverageWhenLTEnetworksarenotubiquitous,devicesareoftenconnectedtotheCSnetworkratherthantheLTEnetwork.Callcontinuityandservicesynchronizationbetweenthenetworksarethereforeimportantissues to bear in mind.

ThecorenetworkmustenableVoLTE-capableLTEhandsetstocontinue voice calls when subscribers leave an LTE coverage area. The 3GPP-standardizedSingleRadioVoiceCallContinuity(SRVCC)functionhandsoveranycallstartedinLTEtothelegacynetworkinordertoensure a continuous voice connection.

IMSVoLTEandcircuit-switchednetworksareexpectedtoprovidethesamevoiceservices.Inaddition,servicemanipulation,e.g.callforwardingactivation,needstobeanaccessagnostic.WhenaserviceisactivatedwithanLTEhandset,ithastobeactivatedonallmobilenetworksatthesametime(2G/3G/LTE).

Dependingondemand,itmaybeunnecessarytoloadIMSandHSSasthemajorityofvoiceservicesmaycontinuetobeprovidedbytheCSnetwork.UntilLTEnetworkcoverageisubiquitous,there-useofcurrentnetworkregisterscouldprovideopportunitiesforcostsavings.

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5. VoLTE solution: Part of NSN Liquid Net

NSN’sVoLTEsolutionreusesexistinginvestmentsandprovidesaseamlessexperienceforsubscriberswhen2G/3GandLTEnetworksare used in parallel and handovers are a common occurrence. This solutionisbasedontheabilitytoprovidefullIMSonanexistingcircuit-switchedvoiceroamingecosystem,enablingre-usabilitythatminimizes investment and operational costs. The solution is provided withtheOpenCoreSystem,partofNSNLiquidNetarchitecture,whichis built on COTS ATCA hardware and allows dynamic resource handling betweencurrentandnewnetworkfunctionsandservices.

IntheOpenCoreSystem,corevirtualizationisusedtobringmoreflexibilitytothecorebyrunningallthekeycomponentsonasingle,commonplatform.LiquidNetmanagesanddeliversservicesandcontent,dynamicallyprovidingthecapacityneededtoensurethebestcustomer experience at the lowest cost.

OperatorscanthereforeruntheMSS,IMSandEPConthesamephysicalATCAplatform,whichcutsOPEXbyreducingfootprintandenergy consumption. Capacity can be dynamically allocated to LTE subscribersusingeitherCSFBvoicecallscontrolledbyMSSorVoLTEcontrolledbyIMS.FurtherOPEXsavingscomefrommoreefficientnetworkmanagementoffewernetworkelements.

Forhybridoperators,theVoLTEsolutioncanbringevenmorevaluebyprovidingasinglevoicesolutionforbothdomains.Inthiscase,itispossibletobuildaunifiedvoicecoresolutioncapableofprovidingserviceforallaccessdomains.TheNSNVoLTEsolutionisfullycompliantwithGSMAIR.92andIR.94specifications,alsocommonlyknownastheGSMA’sVoLTEinitiative.

NSNGSMAspecification-compliantVoLTEsolutionwillmakeinterworkingstraightforwardandalsoensurethewidestchoiceofdevicesforendusers.Thissolutionenablesthefollowing:

• MobileCoretransitiontofullIMSarchitectureviaOpenCoreSystem,ensuringoptimizedexpenditureinCAPEXandOPEX.

• FullreuseofexistingbackendinfrastructureinvestmentswithaCSFBandVoLTEdeploymentstrategy.

• Voicefeatureparityacross2G/3GandLTEaccesstomaintainhighofend-usersatisfaction.

• FlexiblesolutionthatisMSCvendor-agnosticandcanbedeployedinanymarket.

• OpenCorearchitecturethatpromotesagradualmigrationofsubscriberstothenewIMS-baseddomain.

• Mostefficientwayfor3GPPproviderstoshiftexisting2G/3GvoiceservicestoanIMSarchitecture,which,inturn,enablesoperatorstotapintotheemergingvalue-addedRCSecosystem.

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6. ConclusionLTEisraisingthegameformobilebroadband.Itisthefirsteverglobalmobilebroadbandtechnology,andmeasuredinnetworks,devicesandsubscribers,LTEisachievingthefastesteveruptakeofanymobiletechnology.Itisalsothefirstradioaccesstechnologythatis100%packetbased,whichcombinedwiththeall-IPnetworkcore,translatesintogreaterefficiency.

VoLTE,whichdoesmuchmorethanmerelyreplicateCSvoice,willhaveasimilarimpact,enablingarichmultimediaportfoliothatincludesbrowser-basedappsforvoicecalls,chat,communicationsforlocation-basedservices,videoconferencing,etc.Inanutshell,VoLTEwillhelpoperatorsmaintainexistingrevenuesandmoresignificantly,createnew business opportunities and revenue streams.

Inmostmarkets,operatorswilladoptVoLTEinparallelwithCS.Theirgo-to-markettimingwillbecrucial.TheyneedtohavetheirVoLTEofferinginplaceattherighttimeastheLTEsmartphonesarealreadyinmarketandfortherightsegmentstocompetesuccessfullywithOTTplayers,gainnewrevenuewithrichmultimediaandvoiceservicesandachievethefullOPEXbenefitsofVoLTE.

ATCA–HWplatformisbasedonaseriesofAdvancedTCA™

CAPEX – Capital expenditure

CDMA–CodeDivisionMultipleAccess

COTS–commercialoff-the-shelfproduct

CS – Circuit Switched

CSFB–CircuitSwitchedFallback

EPC–EvolvedPacketCore

GSMA–GlobalSystemforMobileCommunications Association

HSPA–HighSpeedPacketAccess

HSS – Home Subscriber Server

IMS–IPMultimediaSubsystem

LTE – Long Term Evolution

MME–MobilityManagementEntity

MSS–MSCServer

NVS – NSN mobile VoIP Server (TAS)

OPEX – Operating expenditure

OTT – Over the Top

PS–PacketSwitched

PGW–PacketDataNetworkGateway

RCS(-e)–RichCommunicationSuite(-enhanced)

SGs–InterfacebetweenMMEandMSCserver

SGW – Serving Gateway

SRVCC–SingleRadioVoiceCallContinuity

SVLTE – Simultaneous voice over LTE

TAS – Telephony Application Server

Glossary of abbreviations

NokiaSolutionsandNetworks P.O.Box1 FI-02022 Finland

Visiting address: Karaportti3,ESPOO,Finland Switchboard+358714004000

ProductcodeC401-00854-WP-201311-1-EN

©2013NokiaSolutionsandNetworks.Allrightsreserved.

Public NSNisatrademarkofNokiaSolutionsandNetworks.NokiaisaregisteredtrademarkofNokiaCorporation.Otherproductnamesmentionedinthisdocumentmaybetrademarksoftheirrespectiveowners,andtheyarementionedforidentificationpurposesonly.

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