© 2011 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 1 Created by the BTA Team (ps_bta@cisco.com) Cisco Confidential 1 © 2011 Cisco and/or its affiliates. All rights reserved. Created by the BTA Team (ps_bta@cisco.com)

Competing on TCO: Superiority of the Cisco Solution Cisco Knowledge Network

7-24-12

Sanjeev Mervana, Sr. Director, Product & Solutions Marketing, Cisco Systems

Ray Mota, Managing Partner, ACG Research

© 2011 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 2 Created by the BTA Team (ps_bta@cisco.com)

Sr. Director – Product and Solutions Marketing,

Cisco Systems, Inc.

Managing Partner, ACG Research

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• Introduction

• Network Evolution

Industry Trends

Shifts in Technology

• Cisco’s Solution

Refresher of Network Virtualization (nV)

Cisco’s Application of nV

• Importance of TCO

ACG Report and Whitepaper

Cisco’s UCE&MB TCO Tool

• Q&A

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Source: Cisco VNI Global Forecast, 2011–2016

94 EB per mo

31 EB per mo

110 EB

per mo

77 EB

per mo

59 EB

per mo

44 EB

per mo

2011 2012 2013 2014 2015 2016

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Application Virtualization

Network Virtualization

Management

Core Edge Agg Access

Optical

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Now topology agnostic and all the way to access and mobile networks

Simplifies the Network

Improves Network Economics

ASR 9922/ 9010

9006 / 9001

ASR 9000 System

ASR 9000v

nV

nV

nV

nV

ASR 901

ASR 903

ASR 903

ASR 903

Increased Service Velocity Quickly deploy new services

Multi-dimensional Scale System and services scale

Simplify Operations Reduce overall TCO

Integrated A to Z Management

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ASR 9000 System is compared to a competing routing solution

ASR 9000v

nV

nV nV nV nV

Core Network

100 GE Up Links

10 GE Up Links

GE Access

Ports

nV: Network

Virtualization

ASR 9922/9010/9006

Core Network

100 GE Up Links

10 GE Up Links

GE Access

Ports

Competing Routing Solution

ALU 7750

ALU 7450 ESS-6/

ALU 7705 SAR 8

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Cost comparisons are made by modeling a aggregation/access network build-out over a 5 year period

Assumptions

• Network Demographics • Network Topology • Network Equipment Type &

Models • Equipment Prices • OpEx Parameters

Traffic Projection & Engineering

• Traffic Forecast • Traffic Engineering • Port Requirements

Network Configuration

• ASR 9000 System o ASR 9922/9010/9006 o ASR 9000v

• Competing Router o Aggregation o Access

TCO Comparisons

• CapEx Calculations • OpEx Calculations • TCO Comparisons • Financial Metrics

Modeling Process

• Modeling process is “bottom-up” similar to design and build-out of actual network • Network demographics are for a typical aggregation network—1000s of households • Traffic projection models triple and quad play usage • Each network element is configured down to the line card using vendors’ data sheets • Equipment prices are at market rates—heavily discounted

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Traffic projections are used to dimension network requirements

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

Residential Subscribers 250,000 300,000 350,000 400,000 450,000 500,000

DSLAMs 350 400 450 500 550 600

GE Ports per DSLAM 8 9 10 10 10 11

GE Access Ports 2,800 3,600 4,500 5,000 5,500 6,600

ASR 9000v 114 132 153 164 175 200

10 GE Ports on Single ASR 9000 Cluster Node 114 132 153 164 175 200

Number of ASR 9000 Clusters 1 1 1 1 1 1

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A detailed OpEx model is used—it is driven by the network configuration outputs from the modeling process

$-

$2

$4

$6

$8

$10

$12

$14

$16

$18

$20

ASR 9000 System Vendor A Vendor B

Mill

ions

OPEX Breakdown

Power Cooling Floor Space Tech Support & Service Network Care

Savin

gs 7

1%

Savin

gs

60%

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CapEx and OpEx estimates are used to create a cash flow analysis

-$10

-$5

$0

$5

$10

$15

$20

$25

$30

$35

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

Mill

ion

s

Cisco ASR 9000 System Cash Flow

Revenue OPEX CAPEX Cumulative Net Cash Flow

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A Business Case for Scaling the Next Generation Internet with the Cisco ASR 9000 System

Available for download:

http://blogs.cisco.com

&

http://www.acgresearch.net

And search for

“ACG Business Case for Next-Generation Internet”

• Cisco ASR 9000 System achieves dramatically reduced TCO through its network virtualization (nV) technology

• CapEx is reduced due to high port densities and more card slots per chassis

• The ASR 9000 System’s network virtualization design simplifies network operations and reduces operations expense (OpEx).

• TCO is reduced by up to 73% over competitive solutions that lack nV technology.

• The payback on the investment in a complete ASR 9000 System is less than one year.

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• Cisco’s UCE&MB architectural approach for mixed access solutions (Mobile, Fixed, T1, Ethernet) is up to 37% lower TCO than competition

• Cisco’s solution has the lowest CAPEX due to high port density, scalability, and unified access for mobile, fixed, T1, and Ethernet – up to 36% lower CAPEX than competitors

• Cisco’s innovation provides significant OPEX reductions:

Cisco nV contributes to lower OPEX by up to 59%

Cisco’s solution has the lowest power consumption - up to 38% lower than competition

• Tool available via your Cisco Representative

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• Scenario-specific view of financial and non-financial metrics: TCO, OpEx, CapEx, Cash Flows, NPV, Chassis Count, etc.

• Ability to export input/ output/ assumptions for particular scenarios

• Tool available via your Cisco Representative

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• We’ll be happy to answer them.

• Please use the Q&A box to the right of the screen.

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Thank you.

Created by the BTA Team (ps_bta@cisco.com)