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TLEN 5510

“How to Make a lot more Money from your Network”. TLEN 5510. Future of Inter-Networking Robert Duncan Transaction Network Services rduncan@tnsi.com +1 (303) 810-2634 (m). Topics. Interconnection of Networks Why? How? Future : All-IP Network Interconnection (IPX)

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TLEN 5510

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  1. “How to Make a lot more Money from your Network” TLEN 5510 Future of Inter-Networking Robert Duncan Transaction Network Servicesrduncan@tnsi.com+1 (303) 810-2634 (m)

  2. Topics • Interconnection of Networks • Why? • How? • Future: All-IP Network Interconnection (IPX) • Roaming among Networks • Why? • How?

  3. Intro • 20 years in Mobile networks • 30 years in Telecom (see “Bellhead”) • Author (“Wireless Intelligent Networks”) • Standards contributor, Chair • Experience in Network Planning, Engineering, Operations • AT&T, Qwest/U S WEST Wireless • TDMA, CDMA, GSM, WiMax, Wi-Fi, LTE

  4. Why? How? Inter-Network Connections

  5. Recurring Pattern Hub Connections: n*(n-1) n

  6. Telephone Toll Local Local Local Local eXchange eXchange eXchange eXchange eXchange WHY Interconnect networks? More subscriber connections, traffic, revenue

  7. Network Interconnection eXchange Network Network Network Network WHY use an eXchange? Fewer network connections, Lower cost

  8. New Network Interconnection New eXchange Network Network Network Network > 1000 Mobile networks! WHY use an eXchange? Fewer network connections, Lower cost

  9. Metcalfe’s Law Connecting Networks Creates Value + = • Value (Network A) + Value (Network B) = ??? • Example: • Value (Network A) = 1,000,000 subscribers’ traffic • Value (Network B) = 1,000,000 subscribers’ traffic

  10. Why Inter-Networking? Maximize Revenue (Metcalfe’s Law)… at Minimum Cost

  11. Convergence Ahead From Circuit to Packet Inter-Network Future

  12. Cellular Calls Connect via _____?

  13. Current Inter-Network Connections FixedNetwork FixedNetwork TelephoneeXchange MobileNetwork MobileNetwork IPNetwork IPNetwork Any Disadvantages?

  14. Disadvantages of Public Telephone Connections FixedNetwork FixedNetwork TelephoneeXchange MobileNetwork MobileNetwork ↑ Cost ↑ Complexity ↓ QoS ↓ Features IPNetwork IPNetwork

  15. Native Inter-Network Connections FixedNetwork FixedNetwork TelephoneeXchange MobileNetwork MobileNetwork IPNetwork IPNetwork IPeXchange

  16. STP Today: Mobile Connects via Public Telephone (PSTN) PSTN(LEC + LD) Signaling Voice MSC MSC GRX BG BG Data SGSN SGSN Op A Op B Circuit Voice Circuit Voice Circuit Voice

  17. STP Tomorrow: Mobile connects via IP PSTN(LEC + LD) Existing technologyNot All-IP MSC MSC MSC Server MSC Server IPX Signaling BG BG Data SGSN SGSN SIP Proxy Voice ENUM MGW MGW Op A Op B Circuit Voice Packet Voice Circuit Voice

  18. STP Future: LTE connects via IP PSTN(LEC + LD) LTE/All-IP MSC MSC CSCF CSCF IPX Signaling BG BG Data SGSN SGSN SIP Proxy Voice ENUM MGW MGW Op A Op B Packet Voice Packet Voice Packet Voice

  19. Choosing the Least Cost Route for Voice Connections

  20. IPX Provides Voice & Data Connectivity A Common Connection Point for Voice & Data ISPs MNOs TNS IPX Packet Data Packet Voice GSM, GPRS/UMTS Operators Circuit Voice ASPs SPs CDMA Operators FNOs

  21. Benefits of Native (IP) Connections International LD: $0.0500/MOU Current LEC interconnect: $0.0025/MOU Current VoIP interconnect: $0.0005/MOU 100X less revenue/minute ↓ Cost <10% of Current ↓ Complexity Flat ↑ QoS Fewer vocoders ↑ Features Unobstructed operation

  22. Observing this Trend in Use • International LD (greatest margins) use of IP • 2006: 2% to 4% of all VoIP traffic goes through a peering service • 2010: Over 50% International Voice via IP • 2010: Mobile-Mobile use of IP eXchange (IPX)

  23. An IP eXchange (IPX) Inter-Network Future

  24. IPX All Operators Can Use IP eXchange (IPX) MNOs ISPs • Applicability • Mobile Network Operators (MNOs) • Fixed Network Operators (FNOs) • Internet Service Providers (ISPs) • Application Service Providers (ASPs) SPs ASPs FNOs

  25. Aicent IPX Viewpoint • Market Needs • MNOs needs to support a wide range of multimedia-based application with high quality. • FNOs are developing Next-Generation Networks • ISPs & ASPs are offering more content/application services • All entities want to interconnect each other in a controlled, efficient, profitable and cost-effective manner. • IP Interworking • IP is the common protocol of above networks and service. • IP Packet eXchange (IPX) is a standardized solution for interconnecting various service providers over a global IP network with high QoS.

  26. IPX TRUSTED ENVIRONMENT Private IPXDomain ISP ISP FNO FNO IPX 1 IPX 2 MNO MNO IPX 3 INTERNET Fixed Mobile IPX Interconnect Principles • Openness • Open to everyone • Ubiquitous access (fixed, mobile, ISP or ASP) • choice (in addition to open Internet) • Quality • guaranteed QoS (E2E SLA, Reliability, Capacity) • quality relationship with your IPX Provider • security (accountability, spam reduction) • Cascading payments • cascading of revenues from End to End • Payment by whoever perceives the value • transparent value-based service pricing • Efficiency • ubiquitous Service via single Gateway • multilateral commercial agreements • flexibility & scalability

  27. IPX IPX IPX IPX Peering Ensures Competition, Choice of IPX Provider MNOs FNOs SPs ASPs ISPs

  28. Layers of IPX Functionality Clearing Inter-Carrier Billing Billing Routing and Addressing ENUM Service Aware for event-based and stream-based traffic VoIP Signaling Traffic Detection for routing, charging, and multi-lateral destination policing MediaConversion Fixed & MobileTermination Network

  29. Quality Openness For more information, please visit www.gsmworld.com/technology/ipi or email us at ipi@gsm.org Thank you Cascading Payments Efficiency

  30. Why?How? Network Roaming

  31. Roaming Mobile eXchange Network Network Network Network

  32. Why Roam? • ↑ Coverage • ↑ Revenue • Roam out of your Network (Retail revenue) • Roam in to your Network (Wholesale revenue) • Who benefits? • Subscriber • Your network (“Home” network) • Roaming partner network (“Serving” network)

  33. Data Access Service Home Network  Internet  RadioControl DataGateway     Home AAA Subscriber Database User Data (Mobile IP) AAA signaling (RADIUS) Data Access Steps: Mobile: Select system Mobile& System: Attach and establish session Serve: Authenticate Mobile Serve: Authorize Mobile System: Connect System: Accounting

  34. Data Access when Roaming Service Home Network Serving Network  RoamingeXchange Internet  RadioControl DataGateway DataGateway RadioControl            Proxy AAA Serving AAASubscriber Database Home AAA Subscriber Database Rating & Billing  User Data (Mobile IP) AAA signaling (RADIUS) Data Access while Roaming: Mobile: Select system Mobile & System: Attach and establish session Serve: Authenticate Mobile Serve: Authorize Mobile System: Connect System: Accounting

  35. Data Access when Roaming on Wi-Fi Service Home Network Serving Wi-Fi Network  RoamingeXchange Internet Internet  RadioControl DataGateway DataGateway            Proxy AAA Serving AAASubscriber Database Home AAA Subscriber Database Rating & Billing  User Data (Mobile IP) AAA signaling (RADIUS) Data Access while Roaming: Mobile: Select system Mobile & System: Attach and establish session Serve: Authenticate Mobile Serve: Authorize Mobile System: Connect System: Accounting

  36. As a network offload solution Network Roaming

  37. November 3, 2010 Reducing the Cost of Data: Wi-Fi Roaming as an Extension of CDMA Roaming Marcio AvillezVP, Network Offerings Robert DuncanDirector, Product Management

  38. Agenda • Problem: Exponential Cost (Data use) [“How to Cope with Future Demand for Data Services,” CDG IRT, Tokyo, April 2009] • Solution: Reuse Established CDMA Data Roaming • Benefits • Reduced OPEX (Cost of Roaming) • Reduced CAPEX (Increased Capacity, Coverage) • Reduced Churn • Implementation

  39. A Tsunami of Connected (Mobile Internet) Devices Proprietary & Confidential

  40. Forecast: 25X traffic increase Forecast: 2X revenue increase Problem: Traffic (Cost) Growing Faster than Revenue “How to Cope with Future Demand for Data Services,” Robert Duncan, TNS, Tokyo CDG IRT, April 2009] Sources: Cisco, from Operators’ network data and Analysts;“Mobile data revenue will double by 2012,” Dan Locke, Analyst Insight, Pyramid, 4/2008]

  41. Exponential Cost - if not Controlled - will Exceed Revenue “Service providers deploying a multi-access offload strategy can expect savings in the range of 20 to 25 per cent per annum”

  42. Leading Operators Adopt Data Offload to Wi-Fi • AT&T + Wayport Investment + Builds • Korea Carriers + 3 Operators build Wi-Fi • Vodafone + BT OpenZone • O2 UK + The Cloud (UK) • T-Mobile + T-Mobile • Verizon + Boingo Current deployments validate Wi-Fi as beneficial across multiple carrier and user scenarios 2008 2009 2010

  43. Wi-Fi Roaming Solution (looks like Data Roaming via CRX) Reuses CRX functionality (looks like Data roaming) to reduce impact on Operator Visited Operator HomeOperator CRX Wi-FiConnection Manager Rating / Clearing Visited Wi-Fi Operator Reporting/Customer Service Signaling Gateway HLR Proxy/ AAA Proxy

  44. 3G Wi-Fi Offload – Primary Use Cases International Use cases • Cost Avoidance: Leverage Wi-Fi to lower roaming costs for international users • Revenue/Coverage Expansion: Leverage Wi-Fi to expand adoption and coverage of international roaming services Domestic Use Cases • Capex Avoidance/Management: offload as a capex management tactic or a hedge against unpredictable or exponential data growth • Owned Networks or Commercial Networks • Roaming Cost Avoidance: regional domestic players who pay to roam on national carrier networks Potential Concerns • Cannibalizes roaming revenue • Operator sets Retail Price & therefore revenue

  45. Benefits of Data Offload via Wi-Fi Roaming • OPEX Cost Savings • Wi-Fi per MB rates lower than equivalent roaming costs • CAPEX Savings • Increased Capacity with offload in high-usage venues:Airport, Hotel, Conference center, City, Cafe, etc. • Indoor Coverage • Reduced Churn (avoid sticker shock) • No network impact • Reuses existing Data Roaming solution (CRX)

  46. Device Form Factor Trends • Smartphones consume 65% of bandwidth • Android, iPhone, Symbian and RIM comprise ~90% Forecast: Global Smartphone and Modem Monthly Data Consumption Forecast: Smartphone Sales by OS Source: Gartner (August 2010) Source Data: Morgan Stanley, 2009; Cisco VNI, 2010, iPass estimates

  47. Thank you! -------------------------------------------- Q & A --------------------------------------------

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