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Is your Network Ready for the Platform Economy? - Juniper NXTWORK 2018

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Digital transformation is much more than building a mobile app. It requires organizations to reformat their business model, moving from a traditional value chain to a platform, to take advantage of the network effect. Platform strategy requires a network that is fast, open, scalable and secure.

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Is your Network Ready for the Platform Economy? - Juniper NXTWORK 2018

  1. 1. How organizations leverage the network to win in the Platform Economy Geoff Sullivan, Head of Marketing – Americas International IS YOUR NETWORK READY FOR THE PLATFORM ECONOMY?
  2. 2. Platform businesses connect producers with consumers that want their products or services The platform is often the Internet (Uber, Airbnb, Netflix, etc.) but doesn’t have to be. It could be any network. Telcos are well positioned as the backbone and enabler of these fast- growing digital ecosystems Enterprises are well positioned to achieve speed, new valuable partnerships, revamped supply chain and new revenue streams through platforms THE PLATFORM ECONOMY producersconsumers platform
  3. 3. Digitize your business model Build a platform-ready network ACHIEVE REVENUE GROWTH THROUGH DIGITAL PLATFORMS Understand the new networking requirements for platforms
  4. 4. Build a platform-ready network Digitize your business model Build a platform-ready network Understand the new networking requirements for platforms ACHIEVE REVENUE GROWTH THROUGH DIGITAL PLATFORMS
  5. 5. DEFINITION OF DIGITAL TRANSFORMATION The realignment of, or new investment in, technology, business models, and processes to drive new value for customers and employees and more effectively compete in an ever-changing digital economy. Brian Solis Senior Analyst, Prophet
  6. 6. Source: “Pipelines, Platforms, and the New Rules of Strategy” – Harvard Business Review Traditional value chain business model Platform-driven business model • Customer value • Internal optimization • Resource control • Ecosystem value • External optimization • Resource orchestration Producers Distribution Marketing Consumers Providers owners Producers consumers Network Platform Eco system THE PLATFORM ECONOMY
  7. 7. THE ECOSYSTEM is the value creation engine for the platform OWNER Service Provider Network. Controller of the platform IP , the governance of the ecosystem and overall business model PROVIDERS Makers of the devices and network equipment that provide the interfaces PRODUCERS Creators for the platforms offerings such applications, content and cloud services Buyers and users of the platform offerings CONSUMERS
  8. 8. MORE THAN JUST BORN-IN-THE-CLOUD Source: “Platform Economy: Technology-driven business model innovation from the outside in” – Accenture market capitalization of the top 15 public platform companies $2.6T total value of 140 “unicorns” largely driven by platform strategies $500Bpercentage of total economy represented by the digital economy 25% number of industry clouds by 2018, up from 100 today (IDC) 500 percentage of enterprises that believe a platform-based business model is “very critical” to their success 40%percentage of enterprise that will create or partner with “industry platforms” (IDC) 80% INDUSTRY PLATFORMS BORN-IN-THE-CLOUD
  9. 9. $10 TRILLION in value from Digital Transformation in Next Decade THE OPPORTUNITY IS ALL AROUND US $2.6T Automotive $2.1T Logistics $1.5T Electricity $7T Media and entertainment $3.1T E-commerce
  10. 10. NETWORK EFFECTS / METCALFE’S LAW PLATFORM ECONOMICS MORE CONNECTION CREATES MORE VALUE Systematic value = N2 Devices or Users N $ Dollars Critical mass crossover Cost = N
  11. 11. To Build or Join? The first consideration when digitizing a business model is whether it is more strategic for your company to join an existing platform or to build their own. Metrics Drive Decisions Measure what is working and what is not. Measure performance. Measure to avoid negative network effect” measure security (for audit purposes) Change in Focus From measuring goods and services delivered (and revenues and profits from it) to measuring platform interactions and the network effects created from them Access and governance • whom to let onto the platform • Is the platform open enough? • what consumers, producers, providers, and even competitors are allowed to do in the platform? Source: “Pipelines, Platforms, and the New Rules of Strategy” – Harvard Business Review HOW PLATFORMS CHANGE STRATEGY
  12. 12. UX, poor performance, scale limitations, Feedback loops can strengthen or weaken a platform – diminish network effect Interaction Failure Misalignment between what is demanded and what is offered. Match Quality Occurs when the cost of switching to something (that might be better) feels too high. Open Standards Lock-in AVOIDING Badly managed platforms often suffer from other kinds of problems that create negative feedback loops and reduce value exponentially NEGATIVE NETWORK EFFECTS
  13. 13. • Build, secure and manage platforms • Provide cloud-powered services to the ecosystem • Collect and analyze data to make the platform more efficient • Move from utility provider to E2E service provider • Build or Join platforms • Connect with customers, partners and suppliers • Digitally transact with customers • Scale from the Network Effect • Consume resources and services on-demand, in real time • Move from 1:1 customer interaction to 1:many Source: McKinney Consulting, “Overwhelming OTT: Telco’s Growth Strategy in a Digital World” THE TELCO OPPORTUNITY Paves the way for new recurring-revenue business models THE ENTERPRISE OPPORTUNITY Creates new digital channels to buy and sell products and services
  14. 14. Platform Examples Business Model: Own the platform, enable interaction between IT consumers and vendors Owner: AT&T Network Providers: Networking Vendors (Juniper, Cisco, Fortinet, Palo Alto, Riverbed) Consumers: Enterprise Customers Business Model: Own the platform, enable platform interaction between buyers and sellers of used goods. Collect Ad revenue. Owner: eBay Consumers: Buyers Producers: Sellers Business Model: Own the platform, enable interactions and HR & Finance data sharing between enterprises and 3rd party providers Owner: Workday Consumers: Enterprise customers Producers: Cloud connect partners (Adobe, Salesforce,) Payroll partners (ADP, CGI)
  15. 15. CASE STUDY: JUNIPER NETWORKS SRX Platform-driven business model SUPPLY SIDE ECONOMICS DEMAND SIDE ECONOMICSto Juniper SRX1500 Distribution Channel sale through partner Enterprise end user • Channel sales model • Lean manufacturing process • Resource control • Delivered through platform partner marketplace • External optimization • Automated one-click deployments Enterprise End-user 3rd party vendors
  16. 16. ACHIEVE REVENUE GROWTH THROUGH DIGITAL PLATFORMS Join the platform economy Build a platform-ready network Digitize your business model Understand the new networking requirements for platforms
  17. 17. PLATFORMS CHANGE THE ROLE OF THE NETWORK NETWORK INVESTMENT MUST ALIGN WITH THE NEW ROLE OF THE “PLATFORM-READY NETWORK” Enabler of employee productivity (Internal Focus) A cost center A revenue generator A vehicle for transacting with platform participants (External Focus) FROM TO
  18. 18. 5 PILLARS OF PLATFORM READY NETWORKS Data & Analytics • Streaming Telemetry • AI & ML • State-driven orchestration • Feedback loop Pervasive Security • Built in, not bolted on • Automated policy • Automated enforcement Speed & Agility • Automated NetOps • Infrastructure-as-code • Multicloud Openness • Open standards • Open source • Multivendor Across all Points in Network Campus Branch Data Center Cloud Scalability • Scale out underlay • Ubiquitous overlay
  19. 19. ACHIEVE REVENUE GROWTH THROUGH DIGITAL PLATFORMS Join the platform economy Build a platform-ready network Build a platform-ready network Understand the new networking requirements for platforms Understand the new networking requirements for platforms
  20. 20. PLAN assessment design accelerate innovation BUILD deployment/onboarding migration rapid deployment OPERATE maintenance optimization protecting and ongoing optimization JUNIPER PROFESSIONAL SERVICES JUNIPER EDUCATION Juniper optimum care Juniper care Automated support and prevention Resident engineer Customer focused technical support CUSTOMER LIFECYCLE OFFERINGS
  21. 21. THE PLATFORM ECONOMY Are you ready?

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