Mobile and Broadband Contentsand IPTVIP Transformation
Eshwar Pittampalli, Ph.D., P.E.
July 15, 2008
Outline
1. Introduction
2. Service and Business Drivers
3. IP Transformation Considerations
4. Raising the Top Line
5. What Makes the Difference?
6. Conclusion
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Transformation:Beyond business as usual
“IP transformation”
= “IP” + “Transformation”
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Transformation:Beyond business as usual
“IP transformation”
= “IP” + “Transformation”
Service and Business Drivers2
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Service drivers: Anywhere, any device, any service,
Single IP network for all access methods and applications
Wide variety of linkages between services and terminals
VoD on mobile devices
Video telephony via computers
Internet access, telephony and IM via TV sets
Gaming on everythingValue of linkage between services and
networkinfrastructure remains
End-to-end QoS per service type
Close coupling between service delivery and content storage
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Technology enablers
IP everywhere
Small, low-cost consumer devices support advanced IP functions
Switches and routers in access and aggregation network support session-based QoS — under control of policy management
Access nodes are becoming (and must be) increasingly intelligent
Wireline access nodes support intelligent video handling for IPTV
Wireless base stations support radio scheduling, encryption, header compression and IP QoS awareness
Application nodes are becoming (and must be) increasingly access independent
IMS for fixed and mobile
Multi-rate live and VoD video coding
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Service drivers and technology enablers lead to IP networks
Any where, any service on any
device
Any where, any service on any
device
IP-aware access nodes
IP-aware access nodes
Application nodes becoming
access independent
Application nodes becoming
access independent
IP networks will have:
Aggregation network supporting multiple access technology - both user and access aware
Minimized number of nodes to improve latency (VoIP, gaming…)
Policy-driven QoS enforcement, activated based on user location, or device choice
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All-IP requires a considerable investment to ensure long term business sustainability — without all-IP carriers business is at substantial risk
Revenue and spend: baseline vs. all-IP
The target architecture of the fixed network operator is composed of a common service layer and a core network connected via broadband access to the client site
Revenue increase is mainly driven by broadband subscriptions and value-added services (e.g. IPTV)
All-IP OPEX increases due to the higher efforts for broadband services — all-IP OPEX per revenue decrease compared to the baseline
All-IP CAPEX substantiates over 7 years — then it is assumed to fall back to baseline CAPEX
All-IP revenue
Baseline rev.
All-IP OPEX
Baseline OPEX
All-IP CAPEX
Baseline CAPEX
Higher revenues
Slightly higherOPEX
Heavy initial investment
Revenue and spend: baseline vs. all-IP
Example — top line
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All-IP requires a considerable investment to ensure long term business sustainability — without all-IP carriers business is at substantial risk
Resulting cash flow analysis
The baseline will drop on zero or lower cash flow putting carriers at substantial risk
The all-IP cash flow becomes largely positive due to highly favourable revenue – cost relation
The all-IP investment is significant and has to be aggressively put through which represents the basic business risk
Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10 Y11 Y12 Y13 Y14
Baseline
All-IP
CLIENT EXAMPLEILLUSTRATIVE
Resulting Cash Flow
Example — top line
3IP Transformation Considerations
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IP transformation occurs at multiple layers of the technology system
Mobile video
SDP/SDE
IMS
IN/AIN telephonyapplications
Gateway MSC
Fixed mobile convergence
IP Core / R4
Backhaul
High-speed aaccess
IPTV
SDP/SDE
IMS
Voice
IN and telephony applications
Legacy data services
CL5/CL4
Core
High-speed access
Focus for wireless
operators
Focus for wireline
operators
Technology system
Applications
Contentservices
VideoData
Voice
PSTN
Call/session control
Internet
Applicationlayer
IP/MPLScoreIP multiservice
edge
Sessioncontrollayer
Optical transportDWDM
3G mobile
SONET/SDH ULH
Access networks Datacenter
EnterpriseDSLAMOLT
CMTSDSLAMOLT
CMTS
Consumer
Media andendpointlayer
Accesslayer
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Transformation program models: Examples of big bang vs. incremental vs. mobile
Technology Program
Access VDSL and FTTN
Core IP/MPLS
Consumer voice NGN voice now >
IMS
Business voiceIP Centrex (Broadsoft)
CL5Subs-driven migration
CL4 Long term
IN and telephony apps
Still working portfolio
Legacy data services
Still working portfolio
IMS Long term
SDP/SDEPartial deployment
now
IPTV In progress
Carrier 1 – Big bang
Technology Program
Access HSDPA in progress
Core IP/MPLS
Distributed Rf Already deployed
FMC Post IMS deployment
CL4/Tandem No plans
IN/AIN Long term
IMS In Trial
SDP/SDE In planning
Mobile video Evaluating
Carrier 2 – Incremental
Carrier 3 – Mobile
Technology Program
Access FTTH
Core IP/MPLS
Consumer voice VoIP
Business voice IP Centrex
CL5 Future
CL4 Future
IN and telephony apps
Future
Legacy Data Services
Future
IMS Long term
SDP/SDE In development
IPTV In progress
Raising the Top Line4
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Unlock the value of your intangible assetsBlending the best attributes of all domains
Telephony domain QoS Trust Reliability Mobility
Content management High-
bandwidthcontent
Brokering
Web domain Advertising Fulfillment UGC (social networking)
IT domain Simplicity Reuse Operations
agility m-
Commerce
Cross-domain services
IP transformation business models
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Tactical moves and long-term strategy AT&T is implementing a common architecture for real-time services (CARTS)
Roadmap:2007 2008 and BeyondAT&T video share: one-way video streaming (live or recorded) with simultaneous audioUtilizes IMS to initiate the video session during a voice call
Continue building new IMS-enabled services for consumer, wireless and enterprise markets
IMS-enabled U-VerseSM Voice Managed VoIP Service Complete evolution of wireline and wireless networks to CARTS unified network
VoIP IMS-enabled services and applications for enterprise
Snapshot of possible future services:Consumer convergence applicationsVideo services and sharingSocial networkingMusicLocation-based service enablerTV - voicemail, talking caller ID, wireless Caller ID
Source: AT&T website Jan 2008
North American example — top line
AT&T is pursuing a “true” three-screen strategyStock performance has seen a 57% increase since 2004 when U-Verse was first
announced
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Focus on investing in growth services
Broadband share in CAPEX mix
27%64%
Success at several service providers confirms level of improvement possible
Streamlining processes and IT systems
Number of OSS/BSS systems
1252
~50
Simplifying the product portfolio and the
‘customer experience’
Products in portfolio
~100~50
Source: service providers reports and analyst presentations
Integration of networks
to allow cost synergies
$1.1B>$3B
Cost synergies from integration and transformation
>$5B
Optimization of the network and operations
Cumulative OPEX savings
€150M€450M
€850M
2011200620072006 2008 20072005 2009
2005200020062005
TelefonicaBell Canada
TelstraKPNAT&T
What Makes the Difference? Experience, Experienceand Experience5
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Ability to optimize cost structures for legacy and NGN networks with network support and operations practices
Designing and implementing flexible IP networks
Service delivery environment expertise — applying network expertise to the IT domain
Managing external expectations and
relationships
IP transformation methodology detailing the end-to-end process
…the most experience, proven methods, cross-domain expertise
Field-proven experience in holistically managing cross-domain interdependencies
StakeholderengagementStakeholderengagement
ServicestransformationServicestransformation
Network transformation
Network transformation
Business transformation
Business transformation
Program management
1
4
3
2
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IPTCs offer enhanced expertiseMultivendor integration and transformation projects worldwide
TNZ - Juniper, Broadsoft, AXIOM, Micromuse, Motive, Cramer, Genesys, … Telstra – Tellabs, Juniper, Convedia, ACME, Cisco, Cramer, MicroMuse, Clarify, …
KPN - Juniper, Cisco, Cramer, Remedy, Siemens, Ericsson, Broadsoft, … Wind - Cisco, Microsoft, Convedia, Sylantro, Harmonics, Thomson, Syndesis, … BT - Motorola, Ericsson, Inventel, Colubris, Microsoft, …
AT&T – Microsoft, 2wire, ScientificAtlanta, HP, IBM, Cisco, Amdocs, …
Murray Hill,New Jersey &Plano, Texas
Antwerp,Belgium
Singapore
Partnering for change
Alcatel-LucentIPTC
ICBrazil
Conclusion6
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Key messages
Service providers are moving from telephony domain to cross-domains based on IP (SP to FSP)*
IP transformation results in converged service delivery environment that separates network access from services access
Service providers have to move into content partner management, security and context aware service environment
Short-term complexity versus long-term simplicity
Maintain both legacy and IP networks
Adopt third party innovations
Reposition as content and solution provider instead of telephony carrier
* Service providers to full service providers
Thank you!