Next Generation Networks

Munir Cochinwala munir@research.telcordia.com 973-829-4864

An SAIC Company

Consumer Spending

Services
Basic Cable

2001 Consumer Spending

$26.68 billion

Premium Services
(Tiers, Pay Services, IPPV, VOD, etc.)

$10.32 billion

Internet Access

$11.6 billion

Telephony

$48.63 billion

Source: Kagan Associates, Yankee Group

Total

$97.23 billion
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The Need
Voice Service Price Erosion and Market Share Loss is Accelerating the Loss of Voice Revenues

Change in Long Distance service price one year after liberalization

-20% -27% -31% -33% 0% -20% -40% -60% -80% -40% -40% -47% -71%

SA

us

Ja pa Sw n ed en C hi le

Source: The Boston Group

er Z m an y
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Data Will Dominate the Network

% of Network Bandwidth
100 90 80 70 60 50 40 30 20 10 0 1 2 3 4 5 % Data % Voice 40 30 20 100 90 80

% of Network Bandwidth

Data

70

DATA
% Data % Voice

60
50

Voice
Year
6 7 8 9 10

10
0 1

Voice
2 3 4

Year

10

45 % Annual Data Growth

100% Annual Data Growth

With voice growing at 8%, in 5-10 years, voice will be a small minority of network bandwidth. The optimal strategy for the future may be to handle voice as much as possible like data.
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Merging the Voice and Data Worlds

Circuit Switching TDM transport High reliability & security Limited programmability Time sensitive billing Slow service set-up Dumb phones Telephony services

Single infrastructure Packet Switching Intelligence throughout

(distributed / collaborative)

High reliability, security & controlled QoS Innovative business to business applications High value service bundles Instant self-provisioning Smart appliances

Packet Switching Intelligence at edge Lower reliability & security Innovation in PC and enterprise applications Flat rate or bandwidth pricing Hard to achieve quality Smart PCs

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What is a Next-Generation Network?

Services
Video

Single Integrated Pipe

HFC (Cable) Network using DOCSIS transport ATM or IP Over xDSL Lines Fixed Wireless

High-Speed Data

Voice/Fax

A network where all kinds of information (voice, fax, video, data) are transported uniformly using packet-based transport and switching media.

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Why a Next-Generation-Network?
Using IP, operators can create an integrated multi-service communications platform
Lower cost structure than competing switched alternatives which enables aggressive price discounting without sacrificing margins

Flexibility of IP networking allows delivery of value added features

Real-time provisioning of additional lines Integrated voice mail, data services, etc.

Enables bundling with existing service offerings NGNs and the PSTN will co-exist for years, making true interoperability essential

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The Need
Bundled NGN Services Can Provide Higher Marginal Profits
Bundled Services -- Over a Single Network -- Produces Better Economics! Traditional Network: ADSL Access From a Telco $180 Per Month 140 NGN: VDSL Access From a Telco NGN: HFC Access From a CaTV Company Existing Revenue Incremental Revenue Incremental Costs Internet
2nd POTS

Video
100

CaTV Internet
2nd POTS

80
40

Internet
2nd POTS

Net Profit

First POTS

First POTS

First POTS

Incremental Costs include incremental equipment and plant, installation costs, incremental operations costs and TV content (for Telco) costs.
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The NGN Service and Application Model

VOICE AUDIO HIGH SPEED DATA LOW SPEED DATA VIDEO TELEVISION OTHER

ERP/IRP Solutions Unified Messaging Web Assisted Call Centers Small Business Infrastructure
Business Applications
NEXT GENERATION NETWORK PROVIDER
SINGLE INTEGRATED INFRASTRUCTURE

Video on Demand E Commerce SOHO/Telecommuting Advertising

Residential Applications
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Next Generation Network - Traditional and New Services

Traditional Services Pay for the Network, New Services Fuel the Growth! Traditional Services
Two to Four POTS Lines Fast Internet Access On-Net Long Distance Advertising

Internet Voice Applications

Click to Talk Internet Call Waiting Wireless Data PC Call Center with Voice / Internet Rent an App (e.g., PC Blackboard)

Work At Home
Virtual Circuits for Phone and PC Professionals Distributed Call Center Applications

Dial Tone II
Java Ring Contains Your Identity Instant Access to Email and WWW Always On; No Wait!

The Long-Term Vision:

A Programmable Network with a Software Developers Tool Kit to build Lots of New Integrated Voice/Data Services
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Traditional Telephony
Typical call user dials number trigger in switch specifies if look-up (translation) is needed (600, LNP) Query sent to centralized database

Centralized servers (Intelligence) (~45 servers)

Providers share cost.share ownership Each server configured for masimum of 1500 reads/sec Updates mostly from centralized management system

Dumb endpoints (Telephones) Intelligent Endpoints

Switches (difficult to program)

New services introduced by trusted providers

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NGN
Multiple numbering systems
IP, Phone, Universal Numbers

Distributed Intelligence
Databases in central servers, Provider database, Customer PC, Phones Central global database does inter-provider translation
On-net to off-net calls return IP address of destination gateway

Central Database is shared by providers Transaction volume

At central db, number of inter-provider calls At services databases (800, call-blocking lists, ) number of subscribed services At Provider and endpoints

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NGN
Network Repositories
User data (profiles, lists) in multiple devices and databases Central Server provides reliability Updates to devices synchronized on re-connect Synchronization on demand or periodically: Local databases are caches User mobility
Where should translation take place Should cache migrate Real-time constraints

Transaction volume across devices, endpoints...

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NGN

Directory Enabled Networks (Cisco)

LDAP interface to network resources Schemas for network resources Used for resource allocation for network services

Warehouses
Traffic warehouses Equipment Inventory warehouse Warehouse used for capacity management, billing, SLAs, ...

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NGN
Object based services
Calls abstracted as object Call models implemented within objects Object mobility used to implement services
Call forwarding Third party call set-up

Objects for service creation

Tool-kit for third party service creation Base Objects/components upon which to build

Device Independence
Migrate calls across device Compose services across devices

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Summary
NGN (competition) has forced
Distributed intelligence Low-cost solutions

Telephone Providers want to jump on the dotcom bandwagon Only a few (2-3 of current Telephone providers will survive

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NGN Target End Customers

Small (2-99 employees) Business
Spend an average of $220/month on telecommunications services

Medium (100-499 employees) Sized Business Market

Spend an average of $2,800/month on telecommunications services

Both segments are vulnerable to competition

Require a bundle of telecommunications services
Multiple telephone/fax lines High-speed Internet access Etc.

Only 62% report loyalty to their incumbent LEC Highly receptive to better, more complete offerings from Source: The Yankee Group competitive carriers
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NGN Target End Customers - Continued

Large (500+ employees) Sized Business Market
Spend more than $3,000 per month on telecommunications services Campus telephony and data networks often provided by on-site resources and staff Require advanced wide-area network (WAN) data services and trunks from enterprise telephony networks NGN services will focus on
Cost containment with bandwidth aggregation and self-service provisioning Work-at-home services for telecommuters Advanced follow-me services for road warriors and office hoteling Mixed voice/video/data services for advanced communication, marketing, and customer service applications
Source: The Yankee Group/Forrester Research

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Distributed Object Architecture

COMMON CALL PROCESSING
Feature Layer Protocols & State Machines

800 LNP

3rd Party or Customer

Provider

SDK

Feature Layer
Service Layer Protocols & State Machines

Telcordia Telephony and Data Services

The Gold

ISUP SGCP Q931 UNI4.0

Service Layer Workhorse Layer

UNI 4.0
Connection Layer Protocols & State Machines

UNI4.0 Proxy

SGCP Other

Connection Layer Commodity Layer

Standard Interface
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NGN - Network Example

API
GUI JAVA Service Definition Service Execution ISCP SS7 Gateway Call Agent
Announcement Server
Unified Messaging Video Servers

Public Signaling Network

TCAP/SS7 ISUP/SS7

Service Applets Customer Care & Billing Network OSSs

Packetized Voice

800
Others

LNP CNAM

Telephony Gateway

DOCSIS CMTS
Application Servers
Data

PSTN

Residential Gateway

Video
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Next Generation Network - Layered Architecture

Customer
- Provisioning - Activation - Programmability

Service

Classic PSTN

Service Definition

Service Execution

Differentiators
SS7 (TCAP & ISUP)

Platform

Web Dashboard

Accounting Gateway

Announcements

OA&M
DOCSIS

Backbone
Access

IP xDSL

ATM

SONET DWDM Cable

Fixed Wireless
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