Document 1.0 Introduction

1
NETWORK AND SERVICES WORKSHOP
INTRODUCTION Xavier Voisin
Dakar, April 18 21, 2005
ITU/EC Regulatory Capacity Building Project for
ECOWAS countries
2
Acknowledgement

• The documents and the business modeling software
  tool used in this workshop are derived from the
  "NGN Economics" workshop developed by Alcatel and
  ITU in the frame of a cooperation agreement in
  support of ITU Centres of Excellence.

3
Expansion/diversification of user needs and of
the service offer

• Changing user needs
• A world of services
• New actors - new business models
• Needs for Regulation
• Practical exercise

4
Which New Services ?
Location based services
Rich voice
Collaborative working
Mobile office
Interactive games
Content streaming
Multimedia conferencing
Music and video download
Directory and Yellow Pages
Web, chat, email
Unified Messaging
Back in Year 2000 Just wondering what will be
tomorrows killer application.
5
New consumer needs are coming !
Belgian Consumer Interest for New Applications
Video on Demand
50
Phone budget control
41
Remote control home
39
Interactive TV
39
Remote control physical
37
Micropayments invoiced
37
Shared phone
35
Location based information
33
Videotelephony
33
Micropayments prepaid
31
Turbo boost
24
Remote control devices
22
Communication/TV
21
Transaction/TV
19
Multiplayer games
14
Games on demand
10
0
10
20
30
40
50
60
Source Insights/Alcatel, April 2003
6
Service Providers Challenges

• Cost lays in the access infrastructure
• Access to uncontrolled services is a facility
  with limited value and does not guarantee a
  profitable business case see current
  profitability issues for Internet Access
  Providers
• Value and revenues are in the services. Question
  
• Which service ?
• How is it provisioned ?
• How is it delivered ?
• Is it effectively billable? to whom? by whom?

Voice revenues are getting down How to create
new revenues ?
7
Traffic and Transport are not the revenue drivers
(1) assuming a prepaid mobile phone tariff of
0.15 per SMS (2) assuming a mobile phone
subscription of 4 hours/month at 42 (3)
assuming a 56.6 Kbits/s dial-in Internet
subscription of 24 /month, connected for 12
hours per month (4) assuming an ADSL
subscription of unlimited connection at 45
/month for a user who connects for about 90
minutes per day with an average downstream debit
of 640 Kbits/second
8
Various types of services

• Free "Goodies"
• Often part of a service bundle
• Cannot easily be sold as stand alone
• Incremental services
• Can generally be sold as stand-alone
• Bundled to build a customized solution
• Generally the focus of market researches
• Bundle / Solution suite
• Satisfy a targeted segment's needs
• Key bundles Package for SMEs, teleworking for
  remote workers

9
In spite of drastic price reduction Voice remains
on the lead

• Supported by mobile communications Voice services
  are growing and remain a major source of revenue
  for operators
• Not limited to Telephony, Voice is also
  associated to a number of diversified services

10
Intelligent Network Voice Services still
continue to grow

• Number translation
• and Routing
• Number Portability
• Personal Number
• Universal Access Number
• Advanced Freephone
• Premium Rate Services
• etc.
• Alternate Billing
• Third Party Charging
• Automated Collect Call
• Sponsored Calling
• PrePaid Telephony
• PrePaid Account Telephony
• Alternate Line Subscription
• etc.

• Life Style
• Universal Personal Number
• Friends/Family Groups
• Originating Call Screening
• Voice Telemessaging
• Voice Activated Dialling
• Wake-up Service
• etc.
• Network Optimisation
• Call Screening Services
• Access Profile Checking
• Number Portability
• Optimised Cost Routing
• Automatic Call Distribution
• etc.

• Mass Calling
• Opinion Poll
• Televoting
• etc.
• Calling Card
• Telecom Calling Card
• PrePaid Calling Card
• Credit Card Calling
• etc.
• Enterprise
• Virtual Private Network
• Wide Area Centrex
• Closed User Group
• Automatic Call Distribution
• etc.

11
NGN and High Speed Internet is drivingnew
billable services
Voice over IP Primary line Second line IP
Centrex usage Voice VPN IP Centrex Basic Advanc
ed Multimedia Conferencing Distance
learning Remote lab Browse and Talk Click to dial
Unified Messaging Content Delivery Games Downloa
ds (MP3) Gambling Video on demand Interactive
TV TV on demand Cinema of the future Long
Distance Bypass Internal External IP offload
BB High Speed Internet PC to Phone Phone to PC IP
VPN (data) BW on-demand QoS on demand Triple
play Instant Messaging / Presence Management MMS
on fixed network 3G applications
Each one with own business model and different
network requirements
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Revenues are driven by services
Log-Log Graph of Estimated Service Provider
Revenue and Growth from End-User Services (B)
1,000
Niche
Emerging
Car automation
Growth Rate Log of 01-04 CAGR of global service
provider revenues from end-user services
Online Gaming
Advertising
VoD
100
AssetOptimization
MarketingCollateral
E-SCM
Videophony
Music Content Videophony
B2B
Home automation
B2E
B2C
Online Fin. Trans.
Messaging
Search
Messaging
Other entertainment
Online News, Sports and other info.
Info. svcs.
P2S calling
10
P2P calling
Voice calling
Mature
Consumer
Enterprise
1
1
1,000
100
10
Revenue Potential
The Boston Consulting Group/Alcatel
13
Business Models in Telecom are not straight
forward anymore
14
Example Revenue Streams for a Network Operator
Service Provider (open)
Service Provider (retail)
application usage
Networkusage
application brokering network usage
Network Operators core business
network subscription package subscription network
usage application usage
Connectivity Provider
Connectivity Provider
Access Provider
roaming
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Regulating the complexity

• The Regulation Authority Challenges
• Setting the ground for the development of the
  telecom services
• Facilitating new services
• Facilitating the appearance of new actors
• Stimulating Incumbent Operator
• Making competition possible and beneficial
• Enforcing universal service
• Well understanding the business issues and
  economical analysis is a key for building an
  efficient Regulation Strategy
• Service value assessment and Business modeling
  will help reaching this target

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Workshop activities

• Lectures
• Presentation of concepts, services,
  architectures, business evaluation methods and
  modeling tools
• Presentation of methods and regulation strategies
• Practical excercises with computers (demo work
  groups)
• Definition of scenarios, services, user demand
  and prices
• Use of Alcatel business modeling tool for
  services
• Analysis of the results
• Case study on regulation
• Interactive sessions
• Experience sharing through regional country
  presentations
• Round tables

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YOUR TOP LIST

• Please enter below the 3 services you think would
  most qualify to rise the profitability of an
  established operator moving to Broadband and to
  NGN infrastructure

Service Name Short description What value does
it bring ?
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YOUR TOP LIST

• Please enter below the 3 services you think would
  most qualify to rise the profitability of a new
  operator moving to Broadband and to NGN
  infrastructure

Service Name Short description What value does
it bring ?