The network of the future: What s s over the horizon
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1 The network of the future: What s s over the horizon BillingAsia2006, 13 March 2006, Shanghai, China Lara Srivastava ITU New Initiatives Programme Director Strategy and Policy Unit International Telecommunication Union The views expressed in this presentation are those of the author and do not necessarily reflect the opinions of the ITU or its membership. Lara Srivastava can be contacted at lara.srivastava@itu.int
2 industry transitions from static market environments to dynamic fast-paced innovation from low-speed to high-speed from divergence to convergence from local to global from fixed to mobile from sometimes-on to always-on from one medium to multimedia from distinct to bundled 2
3 growth of multimedia services Multimedia services being delivered on a variety of platforms TV PCs Mobile phones PDAs In a variety of ways (thanks to high-speed network infrastructure) Live streaming Downloads, e.g. peer-to-peer 3
4 trends towards the ubiquity of networks In addition, the availability of technology is on the rise 2 billion mobile phones 1 billion internet users Developments under way to take this further: Towards universality, i.e. bridging the digital divide and providing access for anyone and everyone Towards ubiquity, i.e. creating a network available anytime and everywhere 4
5 some current challenges for industry players Declining ARPU/average revenue per subscriber e.g. mobile operators Saturation of traditional markets Introduction of new services and channels for delivery Multiple services, multiple providers Different environments, different notions of business strategy and service delivery 5
6 Ongoing shift to all-ip networks Trend away from circuit-switched networks to packet-based networks Next generation networks will have the capability of carrying voice, data, video, multi-media over the same network Users will be connected through multiple access networks based on different technologies (optical fibre, coaxial cables, and WLAN, 3G networks) but all networks will speak the same language, the language of IP 6
7 Some characteristics of Next Generation Networks (NGN) Packet-based transfer Decoupling of service provision and network creates opportunities for those service providers, who do not own content, to offer content/applications Broadband capabilities with end-to-end QoS, transparency Inter-working with legacy networks Generalized mobility Unrestricted access by users to different service providers Unified service characteristics, i.e. perception of same service by users Source: ITU Study Group 13 7
8 NGN - The third wave? New Services Adoption New Connectivity Services Broadband Services User-Centric Broadband Services and NGN DSL Wi-Fi 3G Any device, any connectivity Single Subscription & Authentication Consistent personalization Synchronozation A fragmented user experience Mobile Voice LAN Internet (e) Source: Adapted from Souheil Marine, Alcatel 8
9 Ubiquitous Networks and Ubiquitous Computing Ubiquitous computing Embedding computational power into everyday items intelligence moves to the edges e.g. smart objects/structures, intelligent appliances Ubiquitous networks always-on, anyone, everywhere network access Giving network access to anything In this way, everything becomes networked NGN networks will most likely be the core/backbone infrastructure for deploying ubiquitous networks 9
10 Making networks ubiquitous: 4 key technological enablers Tagging Things: RFID enables real-time identification and tracking Sensing Things: Sensor technologies enables detection of environmental status and sensory information Thinking Things: Smart technologies (e.g. those enabling smart homes, smart vehicles etc.) build intelligence into the edges of the network Shrinking Things: Nanotechnology makes possible the networking of smaller and smaller objects 10
11 tomorrow s radio: everywhere densest radio systems in the world are terrestrial radio and cellular the ratio of radios to humans is nearing 1 to 1 but we are soon entering a new era: in which this ratio could exceed 1000 to 1 radios would be all around us, becoming ambient in the environment thereby radically transforming technology access Making it indistinguishable from daily life 11
12 growth of radio & sensors USD millions 600 RFID Growth (Western Europe) supply chain pharmaceutical 300 transport other Adoption of wireless sensor networks ( ) ' retail 1'000 Sales Source: ITU Internet Reports 2005: The Internet of Things, adapted from Juniper Research 10 Price 1 Units Source: ITU Internet Reports 2005: The Internet of Things, adapted from Harbor Research
13 the changing nature of cyberspace? Embedded internet objects Research network Electronic Mail The Web Elite network People to people People to machines Mobile internet (i-mode, GPRS, 3G ) Portable internet (Wi-Fi etc..) Internet of Things Machine-tomachine or object-to-object Source: Adapted from ITU Ubiquitous Network Societies Workshop, Presentation Materials, Ubiquitous Network Societies and their impact on the telecommunication industry, April
14 intelligence for smart spaces Source: Ubiquitous ID Center 14
15 many players, many revenue streams, many bottom lines Source: ITU Internet Reports 2005: The Internet of Things R&D Production Private Investors & National Initiatives Standards Science & Research Manufacturing SW, System integration Service provisioning AIT RFID EPCGlobal MIT (ex. Auto-ID center) Texas Instruments Versatile MasterCard DARPA Verifone ISO/IEC EU Framework program Georgia Technology institute Precision Dynamics Hewlett-Packard ISO/IEC Innovision OAT Systems National u- initiatives NFC Forum Nokia Think Magic APT(ASTAP) Tyco Retail Solutions Group IBM Business Consulting ADT Security Services Intel APEC TEL Hibiki Consortium Sony SAXA Bluetooth consortium JCB Corporation US DARPA ZigBee Alliance University of California, Berkeley Jet Propulsion Lab Digital Eastern, Melexis, Intersema (sensors) Market Network operation Lead users Examples of specific applications McDonalds PayPass at McDonald s restaurants in the US Chang Gung Memorial Hospital Patients RFID wristbands, Taiwan, China Tesco Item-level tracking across the SCM in the UK NTT DoCoMo Mobile payments via FeliCa chip in Japan Hughes (satellite connection) Intel Research Lab Berkeley Great Duck Island Habitat Monitoring in the US 15
16 Billing: what we re used to Typically per-minute e.g. traditional telephony e.g. dial-up internet services Each network has a bill separate bills for telephony, cable TV, internet etc Separation of network billing from service billing e.g. you might pay your ISP for the network and subscribe to content providers (e.g. the Economist) separately through your credit card 16
17 A new era of complex relationships Telecommunications moving away from a pure pipes only infrastructure-based industry (gone are days of POTS or POGS) What s carried on the pipes is adding more and more value Information and content now being brokered by growing number of players.. meaning that operators need to manage a large number of relationships with content developers and distributors e.g. through revenue-sharing agreements with providers 17
18 (many chefs one soup) Source: CSG Systems 18
19 and entirely new channels: Case in Point the 3 rd wave of VoIP : Internet phone, offered primarily over the public Internet (e.g. FreeWorld, Dial-up, DialPad) : VoIP, offered as discounted telephony over private IP-based networks (e.g. Net2Phone, ibasis) Collapse of dot.com bubble left many VoIP companies struggling as incumbent PTOs also offered VoIP services or acquired VoIP operators (e.g. China Telecom, Teleglobe) 2003-Present: Voice over broadband, offered as free/flat-rate chat + discount calls to PSTN/mobile users (e.g. Vonage, Skype) Corporate IP, as users shift both data and voice to a unified IP platform Voice over IP over mobile 19
20 dilemma for today s mobile operators in particular In a world moving to all-ip and one in which where radios might outnumber humans: Do they stick with per minute billing but be stuck with today's penetration/usage levels (or less as VoIP over mobile makes its mark) Or should they move to flat-rate pricing but hope that new revenue streams will make up for the lost revenue? 20
21 So how to evolve billing? How to move away from device-dependent billing? How to bill for object-to-object communications? How to make billing scalable? How to ensure multi-vendor, multi-service data collection and mediation? How to foster value-based billing? flexible enough to charge in many different manners (by volume, by content type, by event )? How to promote customized billing? e.g. parent s who d like pre-pay billing for teenagers? Are we moving to the ONE ubiquitous user bill, for the ubiquitous network over the horizon? 21
22 a journey of a thousand miles must begin with a single step - Chinese proverb
23 T h a n k s! lara.srivastava@itu.int
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