Huge Potential in MBB Emerging Market, New Blue Sea for Revenue Growth. Telifonica, World Economic Forum, Liquid, GSMA, Airtel, Tower XChange

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2 MOBILE BROADBAND CORE TOPICS 01 Foreword Huge Potential in MBB Emerging Market, New Blue Sea for Revenue Growth 02 Industry Insights & Trends 03 Huawei s View 04 Success Stories Telifonica, World Economic Forum, Liquid, GSMA, Airtel, Tower XChange 1. Building a Better Connected Emerging Market 2. Open the MBB Road By Improving Investment Efficiency 1. Low-Cost Innovative Solution Starts a New Era of Rural Network Construction in Ghana 2

3 FOREWORD Huge Potential in MBB Emerging Market, New Blue Sea for Revenue Growth 3

4 FOREWORD Huge Potential in MBB Emerging Market, New Blue Sea for Revenue Growth Mobile coverage and broadband demand are essential for people in emerging markets, but so far only 81% of the population is covered by mobile signal while 35% of mobile users have mobile broadband in the Southern Africa region. Operators should collaborate with other ecosystems to improve the mobile penetration and coverage to achieve a better connected Africa. Huawei would cooperate with operators to develop more solutions that are valuable, efficient, controlled, and affordable. With the CloudAIR, multi-channel/ multi-sector, and new innovative site solutions (TubeStar, PoleStar and RualStar) deployment, operators can offer wider coverage, more capacity and better experience with higher investment efficiency and faster revenue growth. 4

5 INDUSTRY INSIGHTS & TRENDS Telefonica, World Economic Forum Liquid, GSMA, Airtel, Tower Xchange 5

6 INDUSTRY INSIGHTS & TRENDS 1. TELEFONICA Pedro Planas Chief Technology Officer, Telefónica del Peru Telefonica is deploying innovative ideas to build an efficient network, such as using fixed wireless access as a complement for fixed services to enable ubiquitous broadband, new types of high power low cost BTS for rural coverage, and etc. 1) Providing Services by Converging Fixed with Mobile Networks Source: 2017 Global Mobile Broadband Forum, Pedro Planas, Peru Telefonica CTO - Using Fixed Wireless Access as a complement for fixed services - FWA can offer data and voice services over mobile network (DTH and Movistar Play for TV services) - Service over LTE network preferable 6

7 INDUSTRY INSIGHTS & TRENDS 2) Exploring Disruptive Ways to Extend Coverage in Rural Areas Source: 2017 Global Mobile Broadband Forum, Pedro Planas, Peru Telefonica CTO 2. World Economic Forum Eric White Leader of Internet for All, Fellow, World Economic Forum The Internet s benefits scale with quality and frequency of use. However, significant coverage gaps persist (in EM), exacerbated by a lack of infrastructure finance. Blended finance helps overcome investor barriers and facilitate impact-driven projects. 7

8 INDUSTRY INSIGHTS & TRENDS Coordination failure: Four principal barriers hinder universal internet access Source: 2017 Global Mobile Broadband Forum, Eric White, A forward-looking internet for all, World Economic Forum Fellow 3. LIQUID Shahzad Manzoor Khan Wireless CTO, Liquid Group Every individual on the continent has the right to be connected. Liquid proceed with WTTx to provide fiber-like experience for villages and towns with quick ROI. 8

9 INDUSTRY INSIGHTS & TRENDS Make Business Success with WTTx + FTTx Hybrid 1) The Advantage of WTTx + FTTx Hybrid Networking in EM: Fibre-like experience - Expand coverage beyond urban centers - Based on 4.5G technologies, including massive MIMO and CA WTTx FTTx Combination - During initial stages of broadband service development, WTTx can be deployed to understand local broadband requirements - FTTx can be used to improve user experience and increase revenue to meet higher experience requirement Complementary Technologies - In villages and towns with FTTx networks and close to large cities, operators can provide WTTxbased differentiated products to develop a competitive edge, boasting both complementary fixed and mobile networks Quick ROI - WTTx + FTTx hybrid networking mode allows operators to quickly gain broadband users, shorten ROI periods, and improve ROI 2) WTTx Use Case in Zambia Phase 1 - Start with 50 Sites Covering Lusaka, Kitwe million population K subscribers in 1st year Phase Sites Covering all major town and rural Area - 12 million population K subscribers in the 1st year 9

10 INDUSTRY INSIGHTS & TRENDS 4. GSMA Guillaume Touchard Leader of Connected Society, GSMA Except for densely populated countries, 2G coverage cap stands at around 80%. Rural pilot sites reveal services demand upsides despite low budget. 1) Network Investment Distribution Follows Structural Macro Limitations Source: GSMA-CONNECTED SOCIETY, 2017 Global Mobile Broadband Forum 3 Key Learnings - MBB network investment highly conditioned by population density - Services adoption follows access availability - Except for densely populated countries, 2G coverage cap stands at around 80% 10

11 INDUSTRY INSIGHTS & TRENDS 2) Network Capital Investment is not Optimised Source: GSMA-CONNECTED SOCIETY, 2017 Global Mobile Broadband Forum 3 Key Learnings - 70% of sites across pilot markets are within less than 1km from each other - 13% of coverage is exclusive challenging the perception of network as providing a competitive hedge - Mutualized planning is required 5. Airtel Thelma Quaye Chief Technology Officer, Airtel Ghana In Ghana many people prefer to record their voices and send over whatsapp. We are just about 50% MBB penetration and have more room. I encourage all stakeholders here to play their part to assist with connecting the unconnected. 11

12 INDUSTRY INSIGHTS & TRENDS 1) MBB is flourishing in Ghana, But 20% of population is not covered by wireless in Rural Area Source: NCA / Telecom Statistics/Huawei analytics The Services of MBB in Ghana % of population is connected - Health care access- SANFORD clinics - Mobile Insurance - Productivity of farmers Farmers Club - Mobile Money Penetration 8mn subs in total - Mobile banking, Paying utilities, school fees, etc - Corporate Social Responsibilities 2) Continuing to Enhance MBB Coverage in Rural Areas with Multi-party Cooperation Industrial Collaboration Active collaborations between industrial players for solutions with low initial cost, using solutions as MORAN to reduce investments and operational costs. Policy & Advocacy Government through the NCA and GIFEC can have policy interventions by government such as tax holidays, infrastructure investment through private sector collaborations etc. Affordability Vendors to provide cheaper alternatives Skills & Education The Institute of ICT Professionals will commit to deploying the right professionals to these areas to assist with education. 12

13 INDUSTRY INSIGHTS & TRENDS 6. Tower Xchange Kieron Osmotherly Founder and CEO, Tower Xchange Many emerging market MNOs need to release capital to reinvest in spectrum and network. A healthy towerco partnership should reduce the Total Cost of Network Ownership AND improve performance. Building the site sharing ecosystem in emerging markets African powercos prove towercos improve uptime Source: 2017 Global Mobile Broadband Forum, Kieron Osmotherly, Tower Xchange CEO 13

14 HUAWEI S VIEW 1. Building a Better Connected Emerging Market 2. Open the MBB Road by Improving Investment Efficiency 14

15 HUAWEI S VIEW 1. Building a Better Connected Emerging Market Zhou Jianjun Vice President, Carrier Business Group, Huawei Because of this critical mobile internet demand in emerging markets, equalizing mobile internet for all creates great business opportunities. We need all stakeholders to collaborate to resolve the physical and digital isolation and create multi win-win situation. 1) Potential Upside Economy in Emerging Market Source: 2017 Global Mobile Broadband Forum, Zhou Jianjun, Building a Better Connected Emerging Market, VP of Carrier Business Group, Huawei Technologies 15

16 HUAWEI S VIEW 2) Huawei Brings Collaborations and Business Innovations Source: 2017 Global Mobile Broadband Forum, Zhou Jianjun, Building a Better Connected Emerging Market, VP of Carrier Business Group, Huawei Technologies 2. Open the MBB Road by Improving Investment Efficiency Cao Ming Vice President, Wireless Product Line, Huawei Huawei provides innovative solution enabling the industry to improve investment efficiency on coverage, capacity and experience, for example the CloudAIR, TubeStar, PoleStar, RuralStar etc. We also need industrial collaboration for site alliance for more investment sharing economy and mobile device cooperation for more affordable smartphones. 16

17 HUAWEI S VIEW 1) 5 EM Characters Slowing Down MBB Development Source: Huawei XLab analytics 2) 3+2 to Improve Investment Efficiency in Emerging Market Source: 2017 Global Mobile Broadband Forum, Cao Ming, Open the MBB Road, By Improving Investment Efficiency, EM VP, Huawei Wireless Product Line 17

18 SUCCESS STORIES Low-Cost Innovative Solution Starts a New Era of Rural Network Construction in Ghana 18

19 SUCCESS STORIES 1) GHANA : 20% of population (5.4 million) are not covered by wireless networks - A developing country in Africa with $1380 GDP per capita. - Mobile terminal penetration rate: 106%; ARPU: $ Population: 27 million, of which 20% is uncovered. 2) Challenge: Cost is high yet revenue stays poor - Tower providers are unwilling to build rural sites due to high cost, poor revenue, and extremely low rental ratio in suburban areas. Challenges that Carriers face: High TCO, long ROI, and low revenue 19

20 SUCCESS STORIES 3) RuralStar: Three Transitions for Lower TCO, Higher KPI, and Positive ROI in Year Three Verification: Effective Scenario Identification and Rapid Verification Based on Population, Demands, Power Supply, and Relay Solution Applicability Solar+Iron pole has noticeable cost advantages in quick delivery After deployment, the network KPI exceed customer s expectation. Business Value: ROI is shortened due to lower TCO 20

21 SUCCESS STORIES 4) Voice of Customers: Voice, EDGE data, and MM School Teacher: The experience is better when I texted via WhatsApp and called my friends. Could you not remove it and keep this site in our village? Village Chief: When you share with me the pictures via WhatsApp, it s very quick to receive the pictures and I will protect these materials. This is a good thing for our life. The village chief successfully bought 50 GHS credit using his mobile money. WTTx: WTTx can provide high speed data service for rich people in rural areas, and facilitate ICT education in schools. Village Chief: Our school plans to build a computer center, but we do not have broadband. We request the government to help us. 21

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