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Luis Heredia CALA SE Manager Zhone Technologies, Inc.

Luis Heredia CALA SE Manager Zhone Technologies, Inc. Voice. Local. RPR Ring. Exchange. Access. Switch. Network. Video. Voice. Data. Video. MAKING TRIPLE PLAY MAINSTREAM BUSINESS. SoftSwitch. SIP. H.248. IMT. MGCP. MALC. GR303. Voice. V5.2. Gateway. Router. VoIP. MALC.

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Luis Heredia CALA SE Manager Zhone Technologies, Inc.

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  1. Luis Heredia CALA SE Manager Zhone Technologies, Inc. Voice Local RPR Ring Exchange Access Switch Network Video Voice Data Video MAKING TRIPLE PLAY MAINSTREAM BUSINESS SoftSwitch SIP H.248 IMT MGCP MALC GR303 Voice V5.2 Gateway Router VoIP MALC IP Core MALC T1/E1 POTS IP Video Mux DSL T1/E1 DSL

  2. Zhone Technologies • Zhone Technologies is a next-generation communications equipment provider dedicated to providing multi-service solutions for carriers and MSOs • Founded 1999 • Focused on triple play (IPTV), VoIP, FTTx and metro-access transport solutions • Over 300 customers worldwide • Fifteen sales offices in eight countries • Offering complete lifecycle customer service Zhone Oakland Headquarters

  3. Substantial IPTV Traction Exists in North America Today… About 300,000 homes served… …Over 1,500,000 homes passed Over 100 Commercial IPTV Deployments in North America Mostly IOC and Rural Telco’s Under 40K lines 250+ IPTV Communities Commercially Available Technology Has Enabled Growth Yet more than 35 operators have less than 500 subscribers (scalability)

  4. Service Models Vary Worldwide VOD IPTV MMS Services Cable Competition CLEC Competition Hong Kong: IPTV ‘giant’ • 300K IPTV subscribers since 2003 • 1.5 M VOD subscribers since 2000 • 1M worldwide IPTV subscribers (2004) • 500K in North America

  5. Services rapidly evolving…So is Capacity “Push Based Content Programming” Today - Standard Definition MPEG2 Broadcast Limited HDTV programming VOD Personal PVR (Time shift TV) “Pull Based Content Programming” IP Enabled Around the Corner - Standard Definition MPEG4 Broadcast Broad HDTV programming – MPEG4 TV on Demand Network Time shifted broadcast Interactive TV programming MMS device to device video

  6. Forecasted Households Accessing IPTV • 15 million households will be accessing IPTV services by the end of 2007 • Global revenues from the sector will exceed $7.5 billion in 2007 Sources: Datamonitor (Global); Infonetics (U.S.)

  7. Worldwide Market: IPTV Set Top Devices IPTV Market Set to Explode Millions • Low Cost IP STB’s (Asia) • High End IP STB’s (RBOC) • Residential Gateways (multiple TV’s) • Telco Demand Source: Strategic Analytics Global IPTV Forecast (2003), Cahner’s In-Stat MDR

  8. About Set Top Boxes • Only 20% of U.S. cable customers have STB’s today • Most consumers not familiar • Costly for initial boxes and replacements $350 $300 $200 $150 $100 2005 2006 2004 2002 2003 2001 Predicted price for standard Definition basic IP STB (MPEG2)

  9. The Technology is HERE!!!

  10. IP 5 Ingredients for Triple Play Success Copper video video video Data Voice Fiber: Loop Fiber FTTc to FTTp ADSL2+: Today technology Copper re-use Pure Packet” Head end Internet Encoder to access Cost + integration In-Home Lower CPE costs Less wiring Easy installation IGMP: Imbedded in access Distributed

  11. Pure Packet Network - Middleware VOD - PVR Middleware Integrated to Middleware Ported to API on STB Operating System Integrated to Middleware Set Top Box Ported to API on STB Operating System Considerations Thick or thin client Memory requirements Processing needs Box features Vs. middleware applications 3rd party vendors/applications supported Conditional Access System

  12. IGMP is to video what Dial Tone is to POTS What you should know about IGMP • IGMP was not originally intended for video/channel changing • For data Internet multicast • UDP static state: No means of authentication • IGMP standard requires a number of compromises • Not all IGMP is implemented the same: therefore performance varies • Full implementation IGMPv2 with DIM-PM (Routers) • Access IGMPv2 management with IGMP proxy • Access ‘pass-through’ with IGMP Snooping • IGMP involves no security for content • Does not identify or care what device sends a join • IGMP joins and leaves frequently get out of balance (dropped/overflows) • No automatic method in IGMP standard to “clean up” multicast

  13. MPEG2 and ADSL2+ Opportunities 3.8 Mb/s ADSL2+ 3.5 Mb/s 4.0 Mb/s SD Video • 14 Mb/s to 9 K/ft. • Current state of Technology • 13.4 Mb/s bandwidth used • .6 Mb/s IP/ATM line overhead 2.0 Mb/s 128 Kb/s Data VoIP 12.9 Mb/s 3.8Mb/s ADSL2+ Pair Bonded HD Video MPEG2 • 26 Mb/s to 9 K/ft. • 2005 state of Technology • 24.5 Mb/s bandwidth used • 1.55 Mb/s overhead bandwidth 4.0 Mb/s SD Video 2.0 Mb/s 128 Kb/s Data VoIP

  14. 1.6 Mb/s ADSL2+ MPEG4 1.4 Mb/s 1.5 Mb/s SD Video 2.0 Mb/s 128 Kb/s Data VoIP MPEG4 and ADSL2+ Opportunities • 7.0 Mb/s to 13 K/ft. • Extending ADSL2+ reach • 6.6 Mb/s bandwidth used • .4 Mb/s overhead bandwidth 7.5 Mb/s ADSL2+ 1.5 Mb/s • 14 Mb/s to 9 K/ft. • 2005 state of Technology • 12.9 Mb/s bandwidth used • 1.1 Mb/s overhead bandwidth HD Video 1.8Mb/s 2.0 Mb/s SD Video 128 Kb/s Data VoIP

  15. STB Solutions Do you want this?

  16. Zhone Residential Gateway – IPTV, Triple Play • All in one Solution • Complete CO to CPE solution • Uses existing home wiring • Eliminates Set-Top Boxes • Supports 100Mbps of internet access • Offers up to 4 phone lines • Supports FTTH and DSL • Outdoor or Indoor Deployment Enable Triple Play Over Copper or Fiber ZRG 5xx Outdoor Unit ZRG Outdoor unit ZRG Indoor unit

  17. Zhone Residential Gateways Lowers the cost of deployment – No truck roll Lowers the Cost of Operation – One point of entry to the Customer Premises

  18. Thank You

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