2008 3g cdma latin america regional conference · 2017-12-08 · centennial puerto rico. in...

1

2008 3G CDMA Latin America Regional Conference

2

Ignacio Angulo

With a BSc in Engineering from Universidad Simon Bolivar in Venezuela, Ignacio has extensive experience in Network Engineering, having worked for TelCel Celular and Movilnet in Venezuela, Ericsson in Venezuela and Canada, and now as Executive Vice‐President in charge of Network Engineering, Maintenance and Operations in Centennial Puerto Rico.

In Centennial, Angulo oversees the largest privately owned fiber optic network in the island, with the most extensive wireless coverage, as well. In 2005 he lead the overhaul of the whole network to Nortel and most recently, deployed Rev A throughout the island. As a result, Centennial is #1 in , network reliability, quality and customer satisfaction. 

3

Centennial • Centennial is a full telecommunications provider established in 

Puerto Rico since 1996

• First CDMA commercial application in the Americas

• Only privately owned fiber optic network in Puerto  Rico

• Largest wireless network in Puerto Rico, completely upgraded in Summer of ’05

• Most extensive Wi‐Fi network in the island with more than 100 hotspots

• Significant Submarine capacity towards the Continental US

4

Puerto Rico Operations

Wireline replacement fuels wireless market growth (voice and data)

Shared fiber network creates competitive advantage for each business line

Superior network and service attracts high‐value wireless customers

Unparalleled commercial wireline business gaining market share

Fully integrated provider addressing $3B telecom marketCaribbean Region

Service Areas

Puerto Rico Wireless (F3Q08)

Pops 4.0MSubscribers 423,600Penetration 10.6%

Puerto Rico

U.S. VirginIslands

Florida

Proprietary and Confidential Information to Centennial

5

Centennial creates a sustainable competitive advantage in wireless and broadband telecommunications services by tailoring the customer 

experience to each of its local markets

Proven Local Market Strategy

US Wireless PR Wireless PR Broadband

Proprietary and Confidential Information to Centennial

6

Our Strengths in Puerto RicoLeading wireless network

Unparalleled terrestrial and undersea fiber‐optic network

Established local brand highlighting quality and superior service

Largest and highest quality retail distribution network

Leading direct enterprise sales force

Proprietary and Confidential Information to Centennial

7

Strong Revenue Growth

(1) Excludes Puerto Rico intercompany revenue and aggregate $11.0 million USF charge in fiscal 2007

$0

$200

$400

$600

$800

$1,000

FY2003 FY2007

U.S. Wireless Roaming U.S. Wireless Retail PR Wireless PR Broadband

($ in millions)

2003 – 2007 CAGR: 9%

$664

$923

12%

7%

12%

SegmentCAGR

’03 – ’07

-4%

Proprietary and Confidential Information to Centennial

8

(1) Puerto Rico Operations Free Cash Flow is the sum of Free Cash Flow for Puerto Rico Wireless and Puerto Rico Broadband

Focus on Free Cash Flow GenerationFree cash flow growth enhances deleveraging

($ in millions)

Consolidated FCF U.S. Wireless FCF

$186

$235

$174$200

$255-$265

$210

$113 $102

$93$117

$103 $108$122

$57

$98 $93

$0

$50

$100

$150

$200

$250

$300

FY2003 FY2004 FY2005 FY2006 FY2007 FY2008E

PR Operations FCF

Proprietary and Confidential Information to Centennial

9

Instant Internet®

10

Instant InternetBackground

• Successfully launched in December 2005 with new Axxestel Modem and wireless cards, creating the category.

• Strategy was “end‐benefit” oriented: internet that you buy, connect and use instantly, as opposed to waiting to make and appointment for  a sales technician to come to your house.

• Leverage on our superior network with the best coverage in the island, recognized by customers and competitors. 

• Deployment based on population and network traffic, not following the usual model of area metro and then the rest of the island.

• Only carrier offering two different connection methods: modem and wireless and USB cards. 

• Website tool used to gauge demand.

Proprietary and Confidential Information to Centennial

11

Instant Internet

Pricing Strategy

• Category was priced based on speed; we launched offering top speed at the same price point, therefore ensuring the best experience and generating usage.

• Bundle plan available to current voice subscribers.

• Modem and wireless cards offered free with 2‐year contract to generate sales. 

Proprietary and Confidential Information to Centennial

12

Instant InternetTarget

• Source of business defined as coming from dial up or DSL, not too price sensitive, that values and needs speed.

• Medium to high usage: email, browsing, gaming. 

Proprietary and Confidential Information to Centennial

13

Product

Proprietary and Confidential Information to Centennial

14

Instant InternetSecond Phase

• In December 2007 we launched Rev A, extolling the superior speed of the network and coverage, with more population covered than any carrier in Puerto Rico.

• In January, a door‐to‐door sales force, focused exclusively on selling  Instant Internet across the island was created.

• An exchange program was put in place offering discount to those Rev0 customers that wanted to upgrade to RevA.

Proprietary and Confidential Information to Centennial

15

Instant InternetResults

• Instant Internet consistently exceeds monthly  sales objectives by 8‐10%.

• Instant Internet is paving the way of wireline substitution, making the old phone line unnecessary. 

Proprietary and Confidential Information to Centennial

16

Rev A Network Performance

17

Rev. A vs. Rev. 0Gains achieved by upgrading to Rev.A:

• Wireless Access Performance:

– Average user download speed increased by 21%

– Average user upload speed increased by 766%

– Average user latency decreased by 42%

• Wireless Access Capacity:

– Simultaneous connections per Data Only Module (DOM) increased by 51%

– Simultaneous MACindices in use per DOM increased by 57%

• Real Time Services Capability:

– Rev.A Quality of Service features, and improvements in upload speed and latency, enable the network to provide commercial VoIP and video conference calls as soon as handsets with QoS chipsets are available in the market.

18

The  following tests were performed with an Axesstel D1900  (AW‐D1900, Rev. 0), an Axesstel MV430  (AW‐MV430,  Rev.  A),  and  a  Novatel  EVDO  Aircard  (Merlin  X720,  Rev.  A) using  a standard  IBM  ThinkPad  laptop,  with  an  Intel  Centrino  Duo  processor  and  Windows  XP operating system.  

The  tests  were  performed  on  three  different  scenarios:  lightly  (~5  modems),  mid  (~10 modems), and heavily (~20 modems) loaded sectors under good RF signal levels (steady green led).

In each scenario, three tests were performed:

1st & 2nd.‐ Two 3MB  transfers, using   www.testmy.net,  in order  to measure download and upload speeds

3rd.‐ A hundred packet count ping test (ping www.testmy.net, 12 ‐14 hops away from our core) in order to measure average round trip delays.

Introduction

Proprietary and Confidential Information to Centennial

19

Device Average Download

Average Upload

Average Latency

AW-D1900(Rev. 0)

896 kbps 71 kbps 198 ms

AW-MV430(Rev. A)

1095 kbps 660 kbps660 kbps 132 ms132 ms

Merlin X720(Rev. A)

1082 kbps 686 kbps686 kbps 127 ms127 ms

~22% increase in the download, and ~9 times increase in the upload.Delay decreased by ~34%.

Results-Light Loading (~Rev. 0 Connections per Sector)

Proprietary and Confidential Information to Centennial

20

Device Average Download

Average Upload

Average Latency

AW-D1900(Rev. 0)

558 kbps 129 kbps 412 ms

AW-MV430(Rev. A)

648 kbps 675 kbps675 kbps 277 ms277 ms

Merlin X720(Rev. A)

621 kbps 710 kbps710 kbps 129 ms129 ms

~16% increase in the download, and ~5 times increase in the upload.Delay decreased by ~50%.

Results – Medium Loading(~10 Rev. 0 Connections per Sector)

Proprietary and Confidential Information to Centennial

21

Device Average Download

Average Upload

Average Latency

AW-D1900(Rev. 0)

271 kbps 58 kbps 219 ms

AW-MV430(Rev. A)

339 kbps 503 kbps503 kbps 141 ms141 ms

Merlin X720(Rev. A)

338 kbps 591 kbps591 kbps 130 ms130 ms

~25% increase in the download, and ~9 times increase in the upload.Delay decreased by ~38%.

Results-Heavy Loading(~20 Rev.0 Connections per Sector)

Proprietary and Confidential Information to Centennial

22

Instant Internet ®Subscriber Behavior

23

Bandwidth Consumed by Subscriber Percentiles

75% of

sub

scrib

ersup

to 80

% of su

bscri

bers

up to

85% of

subs

cribe

rs

up to

90% of

subs

cribe

rs

up to

95% of

subs

cribe

rs

last 5

% of su

bscri

bers

0% 20% 40% 60% 80% 100%Percentage of Total Internet Bandwidth

Instant Internet Bandwidth Distribution

75% of subs only consume 24% of

traffic

10% of subs consume 54%

of traffic

Average Subscriber Monthly usage = 3.14 GBytesMax. Subscriber Monthly usage (observed) = 141 GBytes

24

24.6% 22.5%

8.3%4.5% 1.3% 0.8% 0.7% 0.4% 0.2% 0.3%

36.5%

0%

20%

40%

60%

80%

100%

Web

Bro

wsing

Stre

aming

Pro

toco

lsPe

er to

Pee

r

Other

Tunn

eling

Online

Gam

esNew

s Gro

ups

Networ

k Adm

in

Email

Insta

nt M

essa

ging

Outsid

e To

p 10

Instant Internet Bandwidth Usage by Application ‐Download direction‐

25

Instant Internet Bandwidth Usage by Application‐Upload direction‐

19.2%15.5%

7.5% 4.6% 2.0% 1.5% 1.4% 0.5% 0.4% 0.6%

46.8%

0%

20%

40%

60%

80%

100%

Peer

to P

eer

Other

Web

Bro

wsing

Stre

aming

Pro

toco

ls

Tunn

eling

Networ

k Adm

inOnli

ne G

ames

Email

VoIP

Insta

nt M

essa

ging

Outsid

e To

p 10

26

EVDO Rev. ABest Effort VoIPTests Results

27

The following tests were performed with an Axesstel MV430 (AW-MV430, Rev.A), using a standard VoIP phone (Nortel IP Phone 1535), and a “soft”IP phone (X-Lite) running at an IBM laptop, over a loaded DOM A sector.

The tests were performed with five different scenarios:1. VoIP phone + Axesstel MV430 to CDMA2. VoIP phone + Axesstel MV430 to landline3. VoIP phone + Axesstel MV430 to VoIP phone + Axesstel MV430 4. VoIP phone + Axesstel MV430 to “soft” IP phone at IBM laptop5. VoIP phone + Axesstel MV430 to VoIP phone + Axesstel MV430, but the call include video in the same call.

To measure the voice quality we used a 5 point scale, being 1 non intelligible speech, and 5 POTS quality audio (similar to MOS scale).

Introduction

Proprietary and Confidential Information to Centennial

28

Scenario

PerceivedQuality

(Scale 1-5) VoIP Codec Call Type

VoIP phone + Axesstel MV430 to CDMA 3 G.729 Voice Call

VoIP phone + Axesstel MV430 to Landline 3 G.729 Voice Call

VoIP phone + Axesstel MV430 to VoIP phone + Axesstel MV430 4 G.729 Voice Call

VoIP phone + Axesstel MV430 to VoIP soft IP Phone + Axesstel MV430 4 G.729 Voice Call

VoIP phone + Axesstel MV430 to VoIP phone + Axesstel MV430 4 G.729 Voice Call & Video

VoIP Test Matrix

Proprietary and Confidential Information to Centennial

29

Tests Assessment

Proprietary and Confidential Information to Centennial

30

Detailed Test Results

Proprietary and Confidential Information to Centennial