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The Collapse of the Walled Garden

$. The Collapse of the Walled Garden. Paul Gainham Director Service Provider Marketing EMEA. $. Voice. $. $. Wireless. $. Overall Revenue. Broadband. Changing Marketplace. Intense pressures placed on carriers to increase revenue

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The Collapse of the Walled Garden

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  1. $ The Collapse of the Walled Garden Paul Gainham Director Service Provider Marketing EMEA

  2. $ Voice $ $ Wireless $ Overall Revenue Broadband Changing Marketplace • Intense pressures placed on carriers to increase revenue • Content providers are aggressively making offers to customers • Web 2.0, interactive web • Social networking • Video Architectures • Software as a Service • How can this application focus be leveraged? Application Explosion

  3. Plumbing vs. Value • Carriers are faced with the problem of Best-Effort being too good • Only value is in adding more bandwidth…for less revenue • Great for Internet hosted content…is it good for the carrier? • Customer see value in the applications, but not necessarily in the network • Is there value that the carrier can provide in this evolving space? • Is Web 2.0/WebServices a threat or an opportunity for carriers? • What are the new sources of revenue for the carrier? • Need to find sources of revenue beyond just from the customer • New revenue requires new sources of value—what is that carrier value?

  4. Increasing Carrier Revenue • Create an environment that allows the customer to access their desired content in a controlled fashion • Solution: • Focus on Customer Control • Integrate disparate Network Elements (content, core, access) • Differentiate Delivery based on Customer/Application Requirement Cable TV Business Model • Good user experience Users NFL -Content Source ESPN – Content AGG Cable Provider Value Value Value • Each step cares about the “Experience” They are getting paid for it

  5. Transforming the Experience:Controlling the delivery of Services Internet Model • Poor user experience • No differentiating value to the carrier Content Aggregator Content Source SP Value Value User Transformed Model Users Content Aggregator Content Source SP Value Value Value • Increased carrier value & revenue by controlling the “experience” • Appropriate user experience • Increased take-up • Increased take-up

  6. “We don’t have to own every service. We just have to package a lot of them and help the customer find the things they like.” Ivan Seidenberg | Chairman and CEO | Verizon Communications Trends: Collaborative Content Distribution Content and application providers: • Provide an enhanced user experience • Network providers: • Deliver the service experience • Monetize the Network

  7. Home Telemetry Video Gaming WebServices Identity Internet The Role of the Service Provider Network L7 VPN L3 VPN L2 VPN Routing/Switching Connectivity/Virtualization Business Residential Experience Security L7 Application Assured Applications L7 Signature Enhanced Mobile L3/L4 Stateful Best Effort L3/L4 Stateless

  8. WebServices Applications/Content (Video, Voice,…) AAA + Policy and Resource Control Off-net valued content Access Business Applications, End Points, & Services IP Edge/ GGSN Core Future Service Model • It is all about the Application • It is all about the Experience of the end user • Quality, simplicity, continuity, multiple personal devices • It is all about how the network can deliver this

  9. Internet OTT Video Home Telemetry Gaming Home Telemetry Gaming Gaming Video Home Telemetry Video Off-Net On-Net WebServices WebServices Identity Federation & Policy and Control Carrier Network IP Edge Access Carrier Hosted Carrier or Partner Content Internet Hosted No relationship Partner Hosted Partner Content Metro Core Super Core Customer Content Relationships and Network Value Assured Enhanced Best Effort • Carrier Hosted and Delivered – longer time to market, more control Content • Partner Hosted, but carrier transacted – fast time to market, same model • No partner relationship – Best Effort delivered applications, no carrier value • Need to build a model where the network has value – experience is a value that only the network can deliver

  10. The New Off-Net Business Model • Rapid time to market with new services • Deploy a new service every week • Micro-segment the customer market • Target 2% of the customers, not 50% • Leverage the intelligence of application companies • SOA and WebServices Frameworks • Reduce the risk of new services • Always leverage the value of the network • Provide the Glue between the applications and the network

  11. Identity Federation & Policy and Control Carrier Network Customer New Business Model € • Delivering an application with an appropriate experience has value at several levels Microsoft CSF IBM SDP Assured Enhanced Best Effort WebServices Framework Applications Network

  12. Time of Change • We now have the first opportunity for innovation and carrier differentiation in over a decade • This is a new way to do business…not just a new offer or a new network build Leaders will define the future - followers live in it

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