fibre - ftth conference 2017 · source: alcatel-lucent. investment levers for fttx source: ftth...
TRANSCRIPT
Innovation in context
t
FIBRE
digitalthings is a focused advisory services provider,
specializing in digital infrastructure, cloud and internet of
things solutions, broadband networks and services. We
assist with development of feasible projects and
sustainable business models, while turning your strategies
into success and safeguarding your investments.
We enable innovation in context.
Info: www.digitalthings.co.za
Bora VarliyagciFounder & CEO
Communication is a process of sending and receiving information among people (and things).
Form relationships
Spread knowledge and information
Share experiences
Discuss ideas
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Impact of 5G
Growth of Data
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2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Data created
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Source: IDC’s Data Age 2025 study, sponsored by Seagate, April 2017
• 8 Billion HDD • 4ZB Capacity
Past 20 years
• 16 Billion HDD• 163ZB Capacity
In 1 Year (2025)
852010
2182015
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2020 2025
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Number of interactions/capita/day
Source: IDC’s Data Age 2025 study, sponsored by Seagate, April 2017
Source: IDC’s Data Age 2025 study, sponsored by Seagate, April 2017
Where is data created? Where is data stored?
Source: IDC’s Data Age 2025 study, sponsored by Seagate, April 2017Source: IDC’s Data Age 2025 study, sponsored by Seagate, April 2017
Why Optical Fiber?
COPPER
Approx. 32 YEARS to carry data generated in 2025 less than 100 meters (assuming 1 Gbps speed)
WIRELESS
Less than 3 hours to carry around the world (in a single fibre strand)
Use of Optical Fibres
Telecommunications & IT(Internet, Tv, Computer Networking,
etc.)
Medical(Endoscopy, light guides, imaging
tools and also as lasers for surgeries, MRI)
Sensors(Seismic, Tsunami, AC/DC voltage,
temperature inside aircraft jet engines)
Military(Weapons, Networking, Surveillance
UAV)
Automotive(Sensors, lighting)
Mining, O&G, Electricity Grids,….(Inspection, Tele-protection/SCADA,
………..)
Fibre Business Models
Pros Cons
Vertically integrated Control total value chain and cash flow profile. Complex operation and high execution risk.
Wholesale operator Gains additional margins for modest
incremental investment.
Must be technically credible yet flexible. Small
operators may struggle due to lack of
commercial and operational standards for
wholesale.
Passive network
owner only
Simple operations. About 50% of the revenue
potential.
Lack of direct control over the revenue stream
and marketing to the end-user.
Source: Alcatel-Lucent
Investment levers for FTTx
Source: FTTH Council Europe_FTTH Business Guide
Funding Source Skills & Scalability
Competition
Price & Cost Evolution
Policy & Regulation
Infrastructure Sharing
• Cost reduction and/or optimization (both CAPEX and OPEX)
• Extending services to rural and uneconomical areas
• Facilitation of market entry and new revenue sources
• Time to market and innovation agility
Does it make sense?
Considerations
17/10/2017
Trust
Regulatory Framework
Geographic Fit
Technical Fit
Commercial Fit
Alternatives
Market Maturity
Context
Different regulatory and competitive environment in each country may impact the degree and structure of infrastructure sharing.
What are the key challenges?
Supply Side:
• Funding (particularly for rural and underserved areas)
• Policy uncertainty and misalignment (and impact on business levers-over/under supply)
• Shortage of skilled resources and experience
• Lack of proper planning - Slow and cumbersome administrative processes (wayleaves, tower permits, etc.)
- Incorporation of the telco. Infrastructure into other infra projects, etc.
Demand Side:
• Affordability (Service and end-user devices)
• Content Relevance and Awareness
• Digital literacy and appreciation to benefits
• Fit for purpose (both technology and end-user engagement)
Intervention?
Carefully study & understand the problem before formulating a solution
Experience
Strategy Plan Execution
Market Failure
Socio-Economic Impact
Supply Side Intervention• Restructuring (Functional
or structural separation)
• Co-owned infraco
• National broadband
company
Infrastructure Investment• Fiscal measures (Direct & indirect
subsidies eg.USF, tax benefits,
license fee reliefs, etc.)
• Geographically focused
government funded networks
Demand Stimulation• Education for digital literacy
• End-user subsidies
• Relevant and local content
• E-Government and
digitization framework
Continuity
What are the opportunities?
Growing Fibre Footprint Growing Tower Sharing Other Notable Developments
2009 (km)* = 460k
• Almost half of the population is within
25kms fibre reach
• FTTx is accelerating
• International capacity is exceeding
58 Tbps*
• Adoption of open access models*http://www.africabandwidthmaps.com
2016 (km)* > 1 Million
• There are 124 000 towers in sub-
Saharan Africa
• Half of the towers now being
controlled by independent towercos
(from almost none in 2009)
• Growing awareness and
acceptance of socio-economic
impact of broadband, by
governments
• Technology advancements
including emergence of IoT
dedicated networks
• Improving spectrum availability
(digital switchover, sharing
models, etc.)
• Proven success of locally driven
innovation (iRoko, Showmax, M-
pesa, Zoona)
Technology Competence
End User Relationship
Infrastructure Ownership
Regulations
Data privacy
Consumer behaviour
Operational Efficiency
Skills Gap
TowerCoVendors
Capex
IoT
Digitization
Telco
Source: STL Partners / Telco 2.0
Agility
Flexibility
Operational Efficiency
Creativity
Because We Can…. does not always mean We Should !
• It has been and will continue challenging
the business models and how
businesses are run.
• Everything can be tracked and analysed.
• Privacy problems and discrimination
become rampant.
• Data about us could be used to spy on
us.
• There is the danger of hacking and cyber
crime.
Is Big Data Dangerous?
What can we do?
You can reach us by phone or email.
We look forward to talking to you.
Bora Varliyagci - CEO
M +27 (0)82 376 5412
Thank YouT +27 (0)11 0838038