The local loop…

Withnew services,new ways of offering

servicesnew combination of

services

Bucharest, May 2003

Conference “The local loop”, page 2 All rights reserved © 2003, Alcatel

The new challenge of communication services business

MonopolyUsers

Simple servicesSimple customer

ownership

Full competition CustomersVaried servicesShared customer ownership

Value

Connectivity

Acceptable bill

Service

• Content• Personalization• Convenience• Efficiency improvement

Enriched services for customer’s attraction

The Battle &Cooperation field

The traditionalTelco space

Yesterday Tomorrow

Conference “The local loop”, page 3 All rights reserved © 2003, Alcatel

Telecom Service Providers’ future

Utility vs Service Innovators

Basic services only«Low-cost» driven

CommoditizingHighly regulated

Stand-alone

New «value propositions»Invest in innovationHigh value-added

Open to competitionNew business alliances &

models

Conference “The local loop”, page 4 All rights reserved © 2003, Alcatel

Multiple content owners

Multiple content owners

The Telco opportunity

Application

Application

Application

Application

Application

++ ++Be the multimedia/multiterminal

service aggregator

Network

QualityAvailability

ConvenienceIntelligent billing

Multiple TerminalsMultiple Terminals

Conference “The local loop”, page 5 All rights reserved © 2003, Alcatel

MULTISERVICEWIRELINE

Density/Services Landscape

MOBILE 2G

POTS Fax Dial-upInternet

ISDN High Speed Data

Services

100

20

1

1000

Subscriber density /

km2

BROADBANDWLL

BASIC WIRELINE(Direct or Concentrated)

GSM Local Loop

SATELLITE

High

Medium

Low

Very low

Conference “The local loop”, page 6 All rights reserved © 2003, Alcatel

2.5G/3G

Mobile Fixed Wireless

SatelliteSatellite

CO-Based DSLAM

DLC-Based Integrated xDSL with POTS

RemoteDSLAM

CO FTTU

Alcatel — Broadband Access Technologies

The most extensive portfolio of broadband access solutions available

Conference “The local loop”, page 7 All rights reserved © 2003, Alcatel

watchDSL workDSL winDSL

learnDSL

playDSL

hearDSL talkDSL

meetDSL

Maximizing the PC worldAddressing everybody through TV

Maximizing the PC worldAddressing everybody through TV

From connectivity to value

Broadband Entertainment: towards a profitable triple-play on fixed networks

Conference “The local loop”, page 9 All rights reserved © 2003, Alcatel

DriversIncrease addressable market New service components New audiences New appliances (TV, consoles,…)

Increase ARPUs New services to HSI audience Revenue generation for Telco

InfrastructureInvestment

Leveraging

ExistingInfrastructure

Broadband Entertainment:riding the wave

PaybackPaybackHSIHSI

UbiquitisationUbiquitisationBB Entertainment

BB Entertainment

DifferentiationDifferentiationBusinessBusiness

Consolidation

Consolidation

Universal infrastructure

Universal infrastructure

Conference “The local loop”, page 10 All rights reserved © 2003, Alcatel

ResidentialEntertainment

Broadband Entertainment:addressing everyone with PC & TV

Broadcast Interactive TV NVoD VoDPVR

Console Games

BB Internet Audio

SIP based rich media services on PCs &

STBs

Conference “The local loop”, page 11 All rights reserved © 2003, Alcatel

Closed Open

Broadband Entertainment:the Telco’s role

“Walled garden” approach, with various advantages

•ensures direct revenue stream

•brand name associated with telco

•content packaging and easy presentation

•consolidated billing

Examples•AOL, TV Networks, MSO

“Walled garden” approach, with various advantages

•ensures direct revenue stream

•brand name associated with telco

•content packaging and easy presentation

•consolidated billing

Examples•AOL, TV Networks, MSO

“Chaotic Internet” approach, with various advantages

• very broad service mix with unlimited content

• brand name associated with content provider

Examples• Moviefly.com,

movies.com, Napster

“Chaotic Internet” approach, with various advantages

• very broad service mix with unlimited content

• brand name associated with content provider

Examples• Moviefly.com,

movies.com, Napster

“Shopping Mall” approach• open platform for content

hosting ensures broad content availability

• Telco participates in revenue stream

• brand name as most appropriate

• content packaging and easy-to-use presentation

• consolidated billing

Place for the Telco of the future

“Shopping Mall” approach• open platform for content

hosting ensures broad content availability

• Telco participates in revenue stream

• brand name as most appropriate

• content packaging and easy-to-use presentation

• consolidated billing

Place for the Telco of the future

Similar to iMode/MinitelSimilar to iMode/Minitel

Content delivery will increasingly rely on both resource knowledge & control capabilities only the Network Access operator has- Offers a bargaining position for a place in the value chain- Requires enablers at network level to optimally leverage this position

Content delivery will increasingly rely on both resource knowledge & control capabilities only the Network Access operator has- Offers a bargaining position for a place in the value chain- Requires enablers at network level to optimally leverage this position

Conference “The local loop”, page 12 All rights reserved © 2003, Alcatel

7300ASAM Remot

eUnit

VoDServers

ProviderCore

(Data + Video)

Service Management

Head End

76707470

Conditional Access ADSL Modem

End-to-end integration by

Networkservers

AAA, DRM, Resource Mgt, Quality Mgt,

Content-based billing

Broadband Entertainment:full solution over DSL with Alcatel

Summary

Conference “The local loop”, page 14 All rights reserved © 2003, Alcatel

What we are doing today

Build business-model

Commit on end-2-end feasibility

Prove interoperability and openness

Deliver first real implementations

Bring solid partners (terminals, set-top boxes, specialized SW vendors and

integrators)

Solve existing networks issues & migration

Conference “The local loop”, page 15 All rights reserved © 2003, Alcatel

Our overall objective: grow our value with the value of our customers

Valu

e

ad

ded

Products Services

COMMUNICATIONS

SOLUTIONS

COMMUNICATIONS

SOLUTIONS

CONSULTINGTURNKEY BUILD

OPERATIONS

INSTALLATIONMAINTENANCE

SYSTEMSINTEGRATION

NETWORKSOLUTIONSNETWORK

SOLUTIONS

NETWORKEQUIPMENTS

NETWORKEQUIPMENTS

DIVERSIFIED

MOSTLY ALCATEL

100% ALCATEL

L3L3

L2L2

L1L1

Conference “The local loop”, page 16 All rights reserved © 2003, Alcatel

www.alcatel.com

Conference “The local loop”, page 17 All rights reserved © 2003, Alcatel

Alcatel Provisioning advanced integration package

OrderManagement

OrderEntry

Service Activation

Activation Mediations

BRASCPE

ATM IPIPISP/ASPproviders

DSLAM

AxiOSS 5620 product

Alcatel advanced service package

Alcatel 5620 NM

Service/ProcessDefinition

Alcatel 5620 NM activation interface

Alcatel equipmenttemplates

Fast Internet,VPN service and processtemplates

Other vendoractivation interface

Advanced service/ process custom

Network InventoryManagement

Other vendor equipment templates

Other OSS / legacy system integration

Other vendor NMS

Conference “The local loop”, page 18 All rights reserved © 2003, Alcatel

Personalised Service Selector

IPATMISP/ASPproviders

access gateway

class 5

SU

BS

CR

IBE

R

DSLAM&ATMNetwork Manager

BASNetwork Manager

ServiceActivation

Local Loop Management

Service Resource Management

Billing

Order EntryCall Center

Simply connect : High Speed internet service provisioning on ADSL loop for a residential customer

1st S

CE

NA

RIO

1st S

CE

NA

RIO

Order Management

CPE

SUB

SCR

IBE

ROrder EntryCall Center

Order EntryCall Center

Order Management

Local Loop ManagementLocal Loop

ManagementBillingBilling

PSTN

Service Resource Management

Service Resource Management

ServiceActivation

DSLAM & ATMNetwork ManagerDSLAM & ATMNetwork Manager

DSLAM

ATM

BASNetwork Manager

BASNetwork Manager

Activate BASServiceActivation

Order Management

IPISP/ASPproviders

• Create billable customer

• Create service order• Local loop ordering

• Partner follow-up

• Qualified loop return

Activate DSLAM & ATM path Submit order to back

office department

•Create Customer

•Create Account

•Create Service Address

•Create Order

Allocate end-to-end network resources:

DSLAM, switch/router, BAS

Conference “The local loop”, page 19 All rights reserved © 2003, Alcatel

Personalised Service SelectorPersonalised Service Selector

IPATMISP/ASPproviders

access gateway

class 5

SU

BS

CR

IBE

RSimply connect : High Speed internet service provisioning on ADSL loop for a residential customer

1st S

CE

NA

RIO

1st S

CE

NA

RIO

CPE

SUB

SCR

IBE

ROrder EntryCall Center

Local Loop Management

Billing

PSTN

Service Resource Management

Personalised Service Selector

DSLAM

ATM

BASNetwork Manager

ServiceActivation

Order Management

IPISP/ASPproviders

ServiceActivation

Order Management

ServiceActivation

BillingBilling

Update and activate billing

Service Resource Management

Service Resource Management

Order EntryCall Center

Notify subscriber of order provisioning

completion and service availability

DSLAM & ATMNetwork Manager

Update end-to-end network resources:

DSLAM, switch/router, BAS

Service Activation completedCreate a new service for the

subscriber