1) Studies show that a 5% increase in broadband penetration can increase regional GDP by 1.6%, and increasing ICT use by 10% can boost firm productivity by 0.6%. 2) Nearly half of IT directors plan to increase public cloud usage in 2013, preferring telecom providers over pure play clouds. 3) Virtualization allows services to be provisioned in months using NFV/SDN instead of years at half the cost via standard methods.

1. Powering Opportunity Everywhere:
Embracing New Service Models in a Mobile, Virtual
World
Ray Mota
rmota@acgresearch.net
Twitter: @rmota

2. World GDP growth of 4.0% in 2011 fell to 3.2% in 2012. The IMF
sees 3.3% growth in 2013
Economic Uncertainty
US
Europe

4. • Studies estimate a 1.6% increase in regional GDPs with
every 5% increase in broadband service penetration
(integrated across consumer, business, mobile and fixed)
– Source: ‘Latin America Insights 2013’, Monica Zlotogorski, Telesperience,
and Annie Turner, TMF
4
The Benefits of Doing More
• 29% of IT directors surveyed in a Q1 2013 study said their use of public cloud services would
increase in 2013 ..
 And 50% of those said their preferred supplier for public cloud IT is an existing telecom or managed
services provider (vs pure play cloud, vendor-based cloud, or SI/VAR delivered cloud)
 Source: ‘2013 Latin America IT Priorities’, Tech Target, February 2013
• Studies also show firms who increase their use of ICT
by 10% increase their productivity on average 0.6%
 Source: ‘Information and Communication Technologies and
Productivity Growth’, T. Kretschmer, OECD Digital Economy Papers,
2012

5. $-
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
Domestic International Total
Global Capex Trends
2013 Seasonal Trend
1H 2H-E
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
2009 2010 2011 2012 2013E
Capex Yr/Yr Growth
Domestic International Total

6. $-
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
$90,000
$100,000
EMEA APAC CALA Total
International Capex Trends by Region
2013 Seasonal Trend
1H 2H-E
-20.0%
-10.0%
0.0%
10.0%
20.0%
30.0%
40.0%
2009 2010 2011 2012 2013E
Capex Yr/Yr Growth
EMEA APAC CALA Total

10. Service Provider - ARPU
Fixed Data
Fixed Voice
Mobile Voice
Mobile Data
$0
2009
$45
2013
Think APPU

11. Service Provider – Cost and Profits
0%
2009
75%
2013
15%
65% OPEX/Revenue
CAPEX/Revenue

13. DC Virtualization WAN Virtualization Traffic Steering - SP & Ent
Network Performance
Improvement
Enterprise campus
Private DC interconnect - R&S
between DC's by assigning
VM's, looks like single DC Security steering into FW - by customer Latency Computation
SP networks
Is a use case where you can use
OpenFlow to provide dynamic
traffic steering between
datacenters over the WAN via
centralized traffic engineering
with an OpenFlow Conroller. Network Analytics
Optimized video traffic
management
SP mobile access Network monitoring-virtual patch panel Bandwidth on Demand
Cloud gateway for VPN services SP wired WAN Data mining
Multilayer Optimization - Packet
Optical
Campus network slicing - private
networks on one full network
R&E - meteorology, physics, film
VGI, Offline TE and planning Self service provisioning
Enterprise private cloud CALEA tool Flexible fabric for OTT services
Enterprise private security Probe traffic collection
Enterprise private access Application delivery/load balancing
Enterprise private WAN - inter DC SLA management
Parental control

14. 14
Use Case: Open Online Marketplace for
Applications, Programming, and Business Development
(European Operator)
• Operator’s software provides open interfaces + transactions for both consumer and business markets (TV, fixed +
mobile broadband formats for consumer; platform, sector + supply chain formats for business)
• Subscriber self-service and multi-screen delivery provide easy access + uptake
• Steady multi-double digit growth in IP TV subscriptions, IP TV add-on apps, mobile phone subscriptions + add-on
apps, and business apps subscriptions and advertising revenues has resulted
• Overall footprint (broadband uptake), breadth of catalogue, and mix of revenue sources for the operator have
increased ..
• .. nearly all software-driven!
IP TV
Consumer Web + Data
Business Virtual IT
App and Business Ecosystem
Collaboration Platform
Internet Capable TV
Home Wireless
Consumer Mobile User
Business Mobile User
Application Providers
Entertainment / Program Suppliers
Advertisers
Suppliers / Partners
Ecosystem
Open Software + APIs
LoB Transactions + Relationships

15. NfV Service Chaining
One Server Running Multiple VM’s
Edge
Router
EPC FW PCRF NAT App Sites
Revenue Realization
6 12 18 24 300
Industry Standard: 2.5 years
Cost ~$21 MillionService Creation: 18–24 Months
NfV/SDN: 1.2years
Cost ~$8 Million
Service Creation: 6-12 Months Revenue 1 Year Sooner

16. Five-Year Cumulative Operations Expense Comparison

17. Market in Transition: Cloud/Virtual CPE
APPU +32%