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transcript
Fixed-Mobile Convergence StudyIIR Mobile Billing Systems 2004
Dr. David Watrin, Swisscom Innovations,
David.Watrin@swisscom.com
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Agenda
Swisscom presentation
The drivers for Convergence
The Convergence approaches & strategies
Open questions/issues
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Swisscom Innovations:Sustained innovation as a business rationaleINO’s main mission regarding the Swisscom Group
is to be:
the central source of innovation
the major source of long-term technical strategies
the preferred technical consultant
with a strong business focus.
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
An internal yet independent central unit
Swisscom Innovations
CEO
SwisscomEnterprise Solutions
AG
Group Communications
Group Human Resources
Group Operations & Related Businesses
Group Finance & Controlling
Group Information Systems
SwisscomMobile AG
SwisscomFixnet AG
debitel AGSwisscomSystems
AG
SwisscomIT Services
AG
Strategy & Group Steering
Group Headquarter
Group Companies
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Swisscom Mobile
Switzerland's leading provider in the Swiss mobile communications market with a 66% market share
3.8 Mio NATEL® customers
25% of Swisscom Mobile's shares are held by the British-based Vodafone Group Plc and the other 75% by Swisscom Ltd.
Swisscom Mobile Customers
Prepaid / post-paid customers (in Mio)
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Swisscom Fixnet
Within Swisscom Fixnet the different business areas generally act independently:
– Retail Business (sale of network services and products)
– Swisscom Fixnet Wholesale (sale of network achievement)
– Customer Care– Operator Services
(information services)– Payphone Services (public call
boxes)– Cards (Taxcards, Prepaid
Cards)– Bluewin (sale of Internet
services and products)
Swisscom Fixnet in figures
Net turnover 2003 (consolidated)
CHF 5.856 billion
Private customers
2.95 million
Business customers
296'000
ADSL subscribers
389'000
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Context of the presentation
This presentation shares results of a task at Swisscom Innovations in the context of an exploration project
An official statement from Swisscom CEO, Jens Alder, dating back from August could be found in the press
– Swisscom Fixed and Mobile will be kept separated at least for the next three three years,
– Currently there is no concrete plan for a fusion.– Furthermore a fusion would raise legal implications
(e.g. the 25 % equity of Vodafone) which are not fully assessed(http://www.espace.ch/artikel_9538.html)
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
But, … what are the roots of the non-convergent situation? Non interoperable
technologies, yes but…
In the mid 90’s Telecom Markets are liberalized. Historical Operators must grant their competitors an access to their fixed network.
Mobile Telephony was a new market… and a promising one!
Back Office
Systems & Processes
Front Office
Systems & Processes
Back Office
Systems & Processes
Front Office
Systems & Processes
Fixed Operator
Mobile Operator
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
A decade later, prices are dropping but we still don’t observe a convergent price…
Source: http://www.bakom.ch/imperia/md/content/deutsch/telecomdienste/grundlagenundkonsultation/fernmeldestatistik/datenvombakomerhoben/stainofiziellejuni04.pdf
Development of average fixnet and mobile prices in Switzerland since 1998 (year of market liberalisation)
SFr. 0.00
SFr. 0.50
SFr. 1.00
SFr. 1.50
SFr. 2.00
SFr. 2.50
SFr. 3.00
1998 1999 2000 2001 2002 2003
Fixnet: costs of a 3min call(long distance, peak tariff)
Mobile (to fix): costs of a 3min call(peak tariff, most common type ofsubscription)
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
But new & innovative pricing schemes allowed Fixed-to-Mobile substitution… The O2 case in Germany
– “Homezone” (“Genion”) is a single-phone scheme employed to encourage fixed-to-mobile substitution
– Customer can use mobile phone to place calls within 500 m from the home zone for the same price as landline
– 74% of O2 new adds sign up for the “Homezone”
– ARPU increased to €340/year – 50-100% usage increase within the home zone
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
New technologies have the potential to reinforce this substitutionOnePhone
Dual mode DECT/GSM phone
300 m from the home zone calls were routed via PSTN network, and switched to [Cellnet’s] GSM in other areas
Two separate subscriptions
Two bills
No convenience: need to switch manually between the networks
Size of the handset
High cost of the handset
DISCONTIN
UED
BluePhone Future fixed-mobile convergent
phone (GSM & Bluetooth-DSL) (Variant based on WIFI & BB)
Incoming and outgoing voice and data calls within the “BlueZone” routed via the fixed line
User benefits: – Better in-building quality– Lower call cost – One handset, one number– One bill– Seamless handover
The partnership with Vodafone allows BT to act as an MVNO and avoid Fixed-to-Mobile substitution
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Fixed Operators are also facing a new competition from Cable Operators In July Cablecom
(Switzerland) launched its Triple Play offer
Free calls during evenings and WE
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
However Fixed operators still have strong arguments and are starting a new move Reliability and broadband capacity are still better than what Mobile Operatorscan offer
SMS over fixed network
Convergent Data Network
– VPN Unifié service, based on FT and Orange IN focused on corporate users
– Virtual network between mobile phones and company’s extensions
– Private numbering plan and tariffs
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Major operators founded the Fixed Mobile Convergence Alliance (FMCA)
The Alliance aims to accelerate the development of Fixed-Mobile Convergence products and services
The establishment of open standards is a key requirement to allow customers a greater choice of handsets and devices and to enable interworking between vendor equipment
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
The vision for Fixed Mobile Convergence Convergence is the digitized takeover of
communications and information in a network and device agnostic manner producing new services
Network Convergence
Voice and Data Circuit-Packet Service
Convergence
Fixed-Mobile, One Bill Unified Channel,
Bundled Services
Device Convergence
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Why convergence? The operator point of view Convergence should not be seen at an internal
competition. There is a clear advantage from a group perspective to bring new products to the market
Mobility is an add-on in the competition against cable operators
A tighter and more integrated relationship with the customer reduces churn
Infrastructure costs could be reduced on the long term
DATA VOICE VIDEO Mobility
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Why convergence? The customer point of view Full mobility allowing access to personal
information and content at anytime and anywhere: e.g. address book, agenda, music, video
Transparent network for the customer: e.g. One number one device for Voice services
One commercial partner: e.g. one bill
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Convergence: the brave new world!
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Telecom Operators are presently favoring a network based approach to convergence France Telecom announced an all-IP strategy
based on IP Multimedia Subsystem
Ability to have multiple application servers participate in one session for multiple services to a single endpoint
Access agnostic, roaming, multimedia, …
– wireless, 3G wireless, WiFi, DSL, FTTP, …
Open standards based
– Network, application, enterprise, …
Centralized user profiles
– Shared across multiple applications
Integrated user interface / portal
– Ease of use, access from anywhere
Service brokering between applications
– Ensures interoperability of new converged services between subscribers
Ability to have multiple application servers participate in one session for multiple services to a single endpoint
Access agnostic, roaming, multimedia, …
– wireless, 3G wireless, WiFi, DSL, FTTP, …
Open standards based
– Network, application, enterprise, …
Centralized user profiles
– Shared across multiple applications
Integrated user interface / portal
– Ease of use, access from anywhere
Service brokering between applications
– Ensures interoperability of new converged services between subscribers
3RD PARTY SERVICESLEGACY SERVICES
APPLICATIONLAYER
SESSIONLAYER
END POINT AND GWLAYER
SCP
MULTIMEDIA
TELEPHONY
SERVER
SUPPLMENTAL
MULTIMEDIA
SERVICES
PARLAY,SIP,
HTTP,XML
NETWORK
CAPABILITYGW
NON-TELEPHONYMULTIMEDIA
SERVERS
SIPNon SIP
IADSG &
MEDIAGW
MEDIASERVE
R
IM-SSF
Profile and
Preferences Mgmt
CSCF
SC
PSTN
SERVICE BROKER
HSS
IP Multimedia Subsystem (IMS)IP Multimedia Subsystem (IMS)IP Multimedia Subsystem (IMS)IP Multimedia Subsystem (IMS)
DSL, 802.11, GPRS
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Such a focus might alter the convergence vision
Switch
Data plane
Signaling planeSubscriber
SS7
Simplified network architecture of PSTN
BTS
BSC MSC
PSTN
Other MSCs
HLR
VLR
EIRAUC
DTAP
MAP
MAPMAP
ISUP
Simplified network architecture of GSM
Services, Content
Access Access
PSTN, ISDN, xDSL, etc. GSM, UMTS, etc.
IP Multimedia Subsystem
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
The OSS/BSS convergence should also be considered in the early phases Experts say that IMS will reach its full maturity
in 5 years
OSS/BSS convergence might be reasonably achieved in 3-4 years
In the manner of the O2 example an early OSS/BSS convergence might offer an interesting alternative
+3-4Y +5Y
OSS/BSS Convergence
Network Convergence
Market preparation; Organisation changes
Convergence with seamless handover
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
The different strategies for an OSS&BSS Convergence
Strategies:
– Anew – Conquer– Integration
– For each scenario: internal convergence – IN/IT or Pre/Postpaid
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
The different strategies for an OSS&BSS Convergence
Internal Convergence Conquer
Mutual Integration
Build Anew
+3-4Y
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Why an internal convergence? A focus on Billing
Back OfficeSystems & Processes
Front OfficeSystems & Processes
Data /Content
Customer
Back OfficeSystems & Processes
Front OfficeSystems & Processes
Data /Content
Back OfficeSystems & Processes
Front OfficeSystems & Processes
WirelessVoice
RetailVoice
Data
Customer Customer
Prepaid Prepaid PrepaidPostpaid Postpaid Postpaid
Residentia
l
Residentia
l
Residentia
l
Corpora
te
Corpora
te
Corpora
te
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Content Billing might justify Pre- and Postpaid convergence The necessity to monitor content expenditure
on the postpaid bill will require a real-time assessment of the balance and real time service control
Such a balance management will be redundant with the functionalities from the prepay system
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
The “build Anew” strategy
Back OfficeSystems & Processes
Front OfficeSystems & Processes
Data /Content
Back OfficeSystems & Processes
Front OfficeSystems & Processes
Data /Content
Back OfficeSystems & Processes
Front OfficeSystems & Processes
WirelessVoice
RetailVoice
Data
Prepaid Prepaid PrepaidPostpaid Postpaid PostpaidImplementation of a new convergent Mediation Component, Rating
Engine,Invoicing Engine, Customer DB, Financial system…
Operators are usually not ready for such a costly approach
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
The “Conquer” Approach
It can be expected that one system is more flexible than the others
Such a solution offers a reduction of the migration effort
Back OfficeSystems & Processes
Front OfficeSystems & Processes
Data /Content
Back OfficeSystems & Processes
Front OfficeSystems & Processes
Data /Content
Back OfficeSystems & Processes
WirelessVoice
RetailVoice
Data
Prepaid PrepaidPostpaid Postpaid
Extended Application
Prepaid Postpaid
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
The “mutual integration” strategy: an intermediary Pre- and Postpaid Convergence Active Mediation by
leveraging the existing components offers an interesting approach
However other ones are also foreseable
* Openet’s property
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
The “mutual integration” approach would be based on open interfaces The integration approach goes through a modularization of the
functions and open interfaces
The harmonization of the Customer DB can face “philosophical” issues: MS-ISDN vs Fixed telephone number. The TMF SID could offer solutions
WirelessVoice
RetailVoice
Data
Rating & Discounting
Convergent Billing
Rating & Discounting
Rating & Discounting
AAA SCM BM AAA SCM BM AAA SCM BMOSA Parlay,Jainslee,Web Services,XML, …
OSA Parlay,Jainslee,Web Services,XML, …
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Convergence will impact the whole business
Customer Experience
Basis of Value Creation
Revenue Models
Service Pricing
Business Models
Service Economics
Service Usability
Convergence
Business Design
Business Performance
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Convergence will challenge the organization
“One Office” Business Systems
& Processes
Any Service
Customer
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Some remaining open questions
The ownership of the converged network and its related regulation
The interconnect revenues in regards to the evolution towards an all-IP environment
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David Watrin,IIR Mobile Billing Systems 2004,27-30 September 2004
Conclusion
Time and cost of the different scenario have to be assessed
The adequate strategy should be derived from these
Telecom Operators have to tackle the organizational challenges laid by convergence
Telecom Operators need to tackle the next generation services
When should the implementation of Convergence start?