the telecom recovery – a service perspective
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The Telecom Recovery – A Service Perspective. Adam Drobot Senior Vice President – Applied Research Telcordia Technologies 732 699-2100. The Telecom Recovery – A Service Perspective. Unbounded Optimism OPM and a positive attitude. GO—GO—GO! Disaster and attrition Deep freeze Survival - PowerPoint PPT PresentationTRANSCRIPT
GLOBECOM 2004
IEEE COMMUNICATIONS SOCIETY
Telecom Business Forum
Thursday, December 2, 2004
The Telecom Recovery – A Service Perspective
Adam DrobotSenior Vice President – Applied ResearchTelcordia Technologies732 699-2100
The Telecom Recovery A Service Perspective — 2
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 3
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 4
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 5
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 6
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 7
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 8
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 9
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 10
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 11
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 12
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 13
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 14
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 15
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 16
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 17
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 18
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 19
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 20
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 21
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 22
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 23
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 24
The Telecom Recovery – A Service Perspective
Unbounded Optimism
OPM and a positive attitude.
GO—GO—GO!
Disaster and attrition
Deep freeze
Survival
Spring in the air?
““One element of change is that something One element of change is that something must change – things are different!must change – things are different!
The Telecom Recovery A Service Perspective — 25
The Telecom Recovery – A Service Perspective
Worldwide growth in Telecoms – 0% < CAGR < 10%
Complex patterns of WINNERS and LOSERS
Fierce competition and transition to new order!
Geography
ValueChain
Organization
Consumer &Customers
Policy &Regulatory
Regimes
FinancialMarkets
CompetitiveLandscape
Local/Global
Demographics &Economics
TechnologyOptions
Brownfields &Greenfields
The Telecom Recovery A Service Perspective — 26
The Telecom Recovery – A Service Perspective
UnboundedOptimism
OPM &A Positive
Attitude
Disasterand Attrition
Deep freeze
Survival
Springin the air?
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Source: Standard & Poor’s -- SP500telco
250
200
150
100
50
0
The Telecom Recovery A Service Perspective — 27
Where are we now?
Of the world’s 100 largest companies, 12 are service providers for an industry that is about 3.5% of world GDP.
That’s pretty good!
Rank Market Cap Rev NI
13 Vodaphone 155,068 60,018 -16,12325 Verizon Comm. 108,735 67,752 3,07731 NTT DoCoMo 92,820 47,002 6,05235 SBC Comm. 85,413 40,843 8,50543 Deutsche Tel. 73,105 70,317 1,57847 Telefonica 70,347 35,764 2,77548 Nippon Tel & Tel 67,988 103,310 5,99560 France Telecom 58,257 58,080 4,03764 China Mobile 57,376 19,163 4,29679 BellSouth 49,087 22,635 3,58994 Telecom Italia 45,480 14,837 2,94998 Telefonica Moviles 44,577 12,682 2,025
TOTAL 908,253 552,403 28,755
The Telecom Recovery A Service Perspective — 28
US Revenue Growth
Slow
Wireless and data growth are offsetting wireline decline!
Revenues 2000-2004
0
50000
100000
150000
200000
2000 2001 2002 2003 2004
Revenue totals for:BellSouthCingularSBCVerizon
Revenue totals for:BellSouthCingularSBCVerizon
The Telecom Recovery A Service Perspective — 29
Other Measures (US)
This slide shows ratios of various financial measures to revenues Note the lack of trends, except in CAPEX In particular, net cash from operations held up
US Measures to Revenue Ratios
0%
50%
100%
150%
200%
250%
2000 2001 2002 2003 2004
Net Income Net Cash Opn CAPEX Total Assets Equity PP&E
The Telecom Recovery A Service Perspective — 30
EU company revenues
EU companies have stronger revenue growth than U. S.
This holds even before currency adjustments
EU Company Revenue $M
0
50000
100000
150000
200000
250000
300000
350000
2000 2001 2002 2003 2004
The Telecom Recovery A Service Perspective — 31
Other European performance measures
This slide shows other measures as ratios of revenues – note the great difference in pattern from the U. S. companies
Losses mostly from Vodafone Cash from operations holding fairly constant
Revenue Growth from 2000
-100%
0%
100%
200%
300%
400%
500%
1 2 3 4 5
Net Income Net Cash Opn CAPEX Total Assets
Equity PP&E Revenue Index
The Telecom Recovery A Service Perspective — 32
Hot topics and hard problems
Converged networks – New services and new business models
Identity management – Database explosion
Trusted systems – Security and privacy
Economic growth – New customers
Technology investments – Riding the curve
Software – Cost and reliability