Building the Next Generation Mobile
Network
Vision & Blue Print
Towards a SMART Broadband Caribbean Community
Vincent T Spinelli
Managing Director, Mobile Solutions Group
Juniper Networks
AGENDA
The SP Conundrum
New Architectural Approach
Architectural Vision leveraging Software Defined Networks
(SDN)
Paths toward Monetization
 A smarter Caribbean means a more connected Caribbean with new
services models
2
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MOBILE SP SERVICE PARADIGM
TODAY’S CHALLENGES CENTERED ON OPTIMIZATION
Need to ensure profitability over
potential capacity increases toward
higher data rates and mobile data.
Price Pressure
 Voice Revenue
 Big Data Pipe
Access
(Voice OR Data)
Traffic
Peak
Costs
Revenue & Traffic
De-Coupled
Revenues
Voice Dominant
Monetization
Data Dominant
Time
3
Big Pipe
(Voice AND Data)
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 I-Phone/Android
Phenomenon network
effect
 Over-The-Top Applications
 Backhaul
 IMS and the “Killer App”
 Applications are FREE
 Regulatory Concerns
Applications
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THE MOBILE SP CONUNDRUM – BIGGER PICTURE
SP Margins
SP Industry
50% +
OTT Services
20-50%
Mobile Services
10-20%
Fixed Services
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THE MOBILE SP CONUNDRUM – BIGGER PICTURE
How long until Mobile services
commoditize?
SP Margins
50% +
SP Industry
Mobile voice is not elastic (we don’t
do more of it if it gets cheaper)
OTT Services
Value of connectivity/access is
declining
Monetization
10-20%
20-50%
Better consumer segmentation is
required
Mobile Services
Cost Optimization Service transformation is key to
10-20%
5
solve the conundrum
From access provider to
service company
Business transformation
Fixed Services
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MOBILE ARCHITECTURAL THINKING MUST SHIFT
SP Margins
SP Industry
Mobile
Architecture
50% +
OTT Services
Application
Layer
20-50%
Mobile Services
Service Control
& Enforcement
Layer
3GPP evolution and standardization
has and perpetuates tremendous
value
 Roaming
 Global Harmonization
 Cost Control
Standards are necessary but not
sufficient
IMS does not reflect reality
Subscriber policy use cases
can not keep up
Telco 1.0 >> Telco 2.0
10-20%
Fixed Services
Access Layer
 Standardization versus innovation
 Lower layers – standardize system
architecture
 Higher layers – standardize
approach
Social applications require social
networks
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TODAY'S BUSINESS/ARCHITECTURAL PARADIGM
Millions of Customers
Application/Content
Over-The-Top
Services/Service
TELCO
1.0 Revenue
Consumers
Application Layer
SMB
COST
Service Control &
Enforcement Layer
Access Layer
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REVENUE
Enterprise
NEW PARADIGM – TRANSACTIONAL VALUE
Insertion In The Economic Value Chain
Millions of Customers
Application/Content
Advertising
Application
Development
TELCO 2.0
Consumers
Application Layer
REVENUE
SMB
REVENUE
Retail
Service Control &
Enforcement Layer
Government
Content
Access Layer
REVENUE
Banking
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Enterprise
B2B
TELCO 2.0 REQUIRES A SMART NETWORK
IMPACT ON NET NEUTRALITY AND PRIVACY
Intelligent networks are often characterized
as smart pipe (versus dumb pipe)
The smart pipe is not about favoring the
Access Provider’s content; it is a network
resource management and a security
problem
“Off-Net”
“On-Net”
Over-The Top
Content
Managed/Hosted
Content
 Conditioning (not blocking) misbehaving
applications (and subscribers) to ensure
equal access to all applications
 2% of subscribers consume 80% of network
resources
The Network is the common denominator for
which open, efficient, and secure
intelligence delivery (BIG DATA) may be
supplied to the Application
Development/Application Service Provider
community
Subscriber
Profile/Identity
Location
Messaging
Presence
Network
Profile/Identity
Handset is partly a mobile SP managed
device today
 IP layer to radio layer
 Application layer is decided by Subscriber
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HOW DO WE MAKE IT WORK?
SOFTWARE DEFINED NETWORKING (SDN) IS KEY
Standardized
Systems
Standardized
Approach/Framework
Mobile Service
Architecture
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Application Layer
Service Control &
Enforcement Layer
Leverage
SDN
Principles
Access Layer
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Evolve Business Processes
Evolve Access Network
Evolve Core Network
MOBILE NETWORK VISION
SIMPLIFICATION, FLEXIBILITY, & AUTOMATION
Physical Plane
TODAY
FUTURE
Reduce and simplify the layers of
PoC
Points of Concentration
Distributed Data Centers
Data Center
Internet Peering
Virtualized Core
GMSC Site
EVOLUTION
MSC Site
Aggregation/Hubbing Cell Site
IP Radio Routers
RNC/BSC Site
Virtualized RAN
3-5 hops of
microwave
Reduction of
Microwave hops
Hotelled Macro Cell Sites 3G/4G/WiFi SC/Femto
Architectural Planes
Simplification of layers
Simplification of protocols/interfaces
Flexible architecture based on software
OSS/BSS LAYER
REDUCE COMPLEXITY/MINIMIZE DB
SERVICE LAYER
Application
Layer
Service
Control &
Enforcement
Layer
Access Layer
USER ELEMENT (UE)
HANDSETS, SMARTPHONES
MACHINES
RADIO ACCESS NETWORK
MULTI-ACCESS/HETNET
SOFTWARE DEFINED NETWORKING
MOBILE CORE NETWORK
EVOLUTION FROM CS TO PS
SOFTWARE DEFINED NETWORKING
TRANSPORT/TRANSMISSION NETWORK
EVOLUTION FROM TDM/OPTICAL TO IP
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CONSEQUENCES ON BUSINESS DYNAMICS OF
ORGANIZATIONAL SEGMENTATION
Core
Access
VAS
Network
DC infra
OSS
IT / DataCenter
Enablers
CRM
Transport
Apps
BSS
Operations
Layers and domains derive from
20-years old technology constraints
driven architecture
Organizations, and consequently
Business processes, have been
thought using this segmented model
Subscriber churn
Gate
Marketing
Prd. Mgmt
Network/IT
CFO
Traditional business
process
Less than 30% of
Loss of favourable
churn
new ideas
are
‘approved’ and go
OpEx (loss of HE
to costs)
market
Go
Feasibility study phase : 3-4 months
12
On
Hold
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Revenue loss
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NEW ORGANIZATIONAL PROCESS
Empowering Service Providers to create revenuegenerating services with the same dynamics as OTT
B2B2C
MVNOs
Consumer
M2M
Corporate
Marketing &
Sales
Service Creation
and Delivery
Automation of Service Control
Analytics behavioral feeds
Network / IT / DataCenter
(distributed physical/virtualized
resources and assets)
13
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HOW DO YOU CREATE REVENUE INSTEAD OF JUST
CARRYING TRAFFIC?
Behaviour/Social-Based Services
Better Consumer Segmentation
 Analytics-Based Policy
 Personalization – subscriber-based policy controls
Network-Based APIs
 Leveraging Big Data in the Mobile Network
 Partnering with the broader application community
B2B2C/B2B2E
 M2M enterprise services
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REQUIREMENT: BETTER CONSUMER SEGMENTATION
Predictive
Analytics
Detect dynamic
resource usage
Create new
service
offerings on
the fly
Online and
Historical
network trends
Online and
Historical usage
trends
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OTT,
appstores
Understand
dynamic usage
behaviors
Lead to happier and
more stickier customers
Network / IT /
DataCenter
Better Consumer Offers
Personalization
APIS ARE BUILDING BLOCKS FOR DIGITAL SERVICES
Non-telcos: Which telecom APIs
are most valuable?
Billing / payments
61%
Identity / subscriber data management
46%
Location
APIs are how customers
get to your business, and
how you create, consume
and control digital
services.
28%
SMS / MMS
26%
M2M
20%
UC / call control
20%
Security
20%
Presence and IM
Device capability discovery
Other
16%
13%
25%
• Airtime top up
• Data roaming
• Device configuration
• Mobile money
• Number portability
• Prioritization
• QoS
• RCS service APIs
• SIM / UICC APIs
• Voice / video calling
% of respondents Base: Non-telcos involved in API ecosystem (n=192)
Source: Informa Telecoms & Media, Exposing Telecom APIs survey, 2012
75% of developers that Informa surveyed believe demand for communications
APIs will rise due to ongoing mobilization of the web and cloud services.
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* Source Informa
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M2M SERVICE GROWTH
MARKET BREAKDOWN
By 2020 Carrier TAM grows to $292B total, $6B connectivity, $2.8B for Mobility
M2M MNO TAM to 2020 (All Connections)
$350
Global Connected Devices to 2020
$292B
$300
$250
25B
12.0B
$286B: Higher Value
• Device
• Provisioning
• Data Collection
• Reporting
• Analytics
$200
$150
$100
$25.0B
$0.6B
$50
2.0B
5.7B
0.6B
0.7B
$0
2010
9.5B
$6B: Connectivity
2012
2014
2016
2018
2020
M2M MNO TAM to 2017 (Mobility)
$3,000
$2.8B
$2,500
Revenue (US$ Millions)
1.2B
1.6B
$0.4B
$2,000
$1.6B
$1,500
$1,000
$0.7B
$500
$0
CY11
GSM/GPRS/EDGE
Source: GSMA, Machina Research
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CY12
CY13
CDMA2000/EV-DO
CY14
CY15
W-CDMA/HSPA
CY16
CY17
WiMAX
LTE
THERE’S A ‘DISCONNECT’ IN THE TELECOM
INDUSTRY WHEN THINKING ABOUT SDN*
Here’s what 240 telecom
operators told Informa.
In fact, SDN is the
linchpin to deliver
on top-line growth
expectations.
2013: What technologies and services
will drive top-line growth?
4G / LTE
Cloud computing
Superfast fixed broadband
Apps and app stores
On-demand video
Converged billing
Machine to machine (M2M)
Multiscreen video
Wi-Fi
High-definition video
Carrier Ethernet
SDN
58%
32%
25%
22%
21%
21%
20%
20%
17%
17%
17%
2%
Source: Informa Telecoms & Media, 2013 Industry Outlook survey
Operators believe that SDN is something divorced from service monetization.
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* Source Informa
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KEY TAKEAWAYS
TOWARD A SMARTER BROADBAND CARIBBEAN
Rethink how we design, build, and operate: From Network to Services
 Standardization versus Innovation
 Monetization & Cost Optimization enabled by Software Defined
Networking
 Cost optimization as part of SP hygiene
 The real value of SDN is in monetization
Consumer segmentation provides better consumer service and
subscriber self control resulting in happier customers
The Network is a platform with a rich set of APIs that are the
foundational building blocks for digital services
M2M services will be key differentiators
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Juniper Networks Offers
Innovative IP Solutions
to Improve Customer Experience and SECURELY
OPTIMIZE and MONETIZE
the Mobile Network
PERSONALIZATION USE CASES
WHAT OPERATORS DO TODAY
USE CASE
Fair usage
%
Bill Shock / Roaming Controls
80%
QoS Control
60%
Fair Usage
60%
Redirection (Upsell)
36%ye
d
o
l
PCC (Policy and Charging Controls)
e3p6%
ts d
E
Service Tiers
Fir 32%LT
Roaming control (bill shock)
Tier 1
Tier 2
Tier 2
Tier 1
Tier 1
Tier 1
Tier 1
Tier 1
Tier 1
Tier 1
Tier 2
Tier 2
Tier 1
Tier 1
Tier 2
Tier 2
Tier 2
Tier 2
Tier 2
Tier 2
Tier 1
Tier 1
Tier 2
Tier 1
Tier 2
24% n
n
n
n
n
n
n
n
n QoS Control, 60%
USA LTE
2009 n
20%
Pass
Service
n
n
n
n
Indonesia
2011
Parental Controls, 16%
16%
n
n
n
n
n
n
n
USA Promotions / Zero Rating2011 n
n
n
n
n
n
n
n
n
n
BrazilPrioritization (Service, Subscriber)16%
2011
n
n
n
n
n
n
n
Parental Controls
(Service, n
Prioritization
Indonesia
2010 16%
n Subscriber), 16%
n
n
n
France
2009 16%
Device Tethering
n
n
n
n
n
Poland
Time-based Controls 2009 12%
n
n
n
Slovakia
2012 8%
Shared quotas
Zero Rating,
/n
Promotions
Fair Usage, 60%
n
n
n
EgyptFMC Quota Control 2012 8%
16%
n
n
n
n
n
n
n
n
Kenya
2009 4%
VoLTE
n
n
n
20%
Pass,
Service
JapanVideo Optimization 2010 4%
n
n
n
n
n
USA
2010 n
n
n
n
n
Austria
2012
n
n
Belarus
2012
Redirection (Upsell),
LTE , 24%
n
n
Bulgaria
2012
36%
n
n
Croatia
2012
n PCC (Policy
n and
R. Serbia
2012
Tiers,
Service
n
Charging
R. Macedonia
2012
32% n Controls), 36%
n
n
Slovenia
2012
n
n
n
n
n
South Africa
2010
PoC
n
n
Canada
2011
n
n
Turkey
2010
n
n
USA
2011
n
n
n
n
n
Netherlands
2009
n
n
n
n
n
n
n
n
Kuwait
2008
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Tiered services and service
boosts
Web session (HTTP) control
LTE promotion
Tiered QoS
21
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rt o
be
i
r
8%
Control,
Quota
FMC
ls
% Video Optimization,
on
sc
ro
4%
C
b
t
g
u
n
S
on
ng
i
4%
VoLTE,
i
,
t
C
g
8%
Sharedicequotas,
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ar
ro ro ls min sell g
rv tion
t
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o
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Time-based Controls,
(
o
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o
ri as
U
iz12%
an
on im rs ss d C s / on / R n ( he ot a C
ol
il cy age ntr zati pt Tie Pa ase tion al C ck tio Tet qu uot
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E
Co riti eo O vice vice e-b mo ent Sho ire ice red C Q
(P
S Tethering,
v
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d
r
l
a
r
r
io id 16%
o
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m
o
o
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r
r
a
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Q
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Se Se Ti P
P
B
R
De Sh FM
NETWORK DESIGN MUST TRANSFORM TO 21ST
CENTURY NORMS
Legacy Network (Telco 1.0)
New Mobile Network (Telco 2.0)
Network Design
 Static
 Over Provisioned
 Multi Network for voice, video,
data services
 Elastic
 Flexible, Scalable, Centrally Managed
Nature of Network
 Proprietary, Silo’d
 Open and much less proprietary
Management
 Network Operations Center
 Service Operations Center
3rd Party Interface
 Closed “Intelligent Network”
 Proprietary
 Web based Protocols
 APIs
Service Velocity
 16-18 month innovation cycle
 Reactive, me-too, services
 In-house
 Expansion into new markets and
services
 High degrees of personalization
 Out-sourced/In-house development
22
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DIGITAL ECONOMY FOUNDED ON COMPUTE & COMMUNICATIONS
EXAMPLE - THE VALUE OF THE NETWORK HAS CHANGED
Sarnoff’s Law

Rapid Adoption of Group Forming
Networks/Communities of Interest
The total value of a communications
network grows with the square of the
number of devices or people it
connects

Facebook - 2007

.3
Tandem Switching
Metcalfe’s Law

4
WWW - 1984


38
Radio- 1922
5
10
15
20
Value Of Potential Connectivity =
bN(N-1) è bN2 optional transactions
Ethernet, Internet Protocol
“Reed’s Law” on Group Forming
Networks
16
PC - 1972
The total value of a communications
network grows with the square of the
number of devices or people it
connects

13
Television - 1946
0
Value = aN; where N = number of
users
25
30
35
40


Years to 50 million users
Advertising Example
Group Forming Networks are
communities of interest whose
connectivity value scales exponentially
to N
Potential Value = c2N-N-1 è c2N
Social Networking, Transactional Value
Therefore Total Value Of Network: aN +
bN2 + c2N è c2N
GFN Transactions Create More Value
Per Unit Of Network Investment
23
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*Source: The Sneaky Exponential – Beyond Metcalfe’s Law to the Power of Community Building; David Reed
WHAT DOES IT TAKE TO MAKE IT WORK
Elastic allocation of
service-level resources
(centralized, distributed)
Policy
driven
control of
subscriber
services
Distributed
Service Provider
control domain
Distributed
Behavioral
knowledge of
subscriber
(Analytics)
Behavioral community
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Centralized
MACHINE TO MACHINE
VERTICAL BREAKDOWN
M2M connections will grow from 2B in 2011 to 12B in 2020
M2M Connections
by Sector in 2020
Source: GSMA, Machina Research
25
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