Preparing for the Connected Devices Explosion

Transcription

1 Preparing for the Connected Devices Explosion Operator challenges & key business issues Divna Vuckovic, ericsson Business development director Region Mediterranean

2 50 billion connected devices billion middleclass consumers P e r s o n a l n e t w o r k People O n l i n e: h o m e s >1 billion vehicles I n t e l l i g e n t t r a n s p o r t Business Society S m a r t u t i l i t i e s I n d u s t r y &: s o c i e t y >100 billion embedded processors shipped (cumulative) >3 billion utility meters Page 2

3 Three waves of connected devices Increased proposition reach Improved value propositions consumer lifestyle Increased process efficiency Increased human effectiveness Networked Everything Networked Society Networked Verticals 2.0 Industries Networked Consumer Electronics 3rd wave 2nd wave 1st wave Page 3

4 Where the third wave of connections will come from? 2020 Connected Devices M2M 50 BILLION CONNECTED DEVICES: ~10 billion connections are assumed to come from phones and mobile broadband. The remainder must come from new categories - connected devices beyond people. 3-4 B 3 B 7+ B Page 4

5 M2m market explosion m2m - mobile and Fixed connected Devices M2M Monthly ARPU by segment (2010, Wireless devices only, average worldwide) Million Unit 5,000 CAGR 4,000 3, % 2,000 1, Healthcare Transport/Vehicles Green Tech Utility Security Maintenance Building Automation Retail Outlets Service ARPU Network ARPU 1.5 $ On average the number of M2M connections is forecasted to grow by approximately 60% each year ARPUs for all segments, excluding healthcare, forecasted to fall by 37% for network connectivity and by 38% for service provision over 10 year M2M opportunities for operators in variety of roles Efficiency and simple business model are critical to grow with good margins Source: MWC Connected Devices; Strategy Analytics; Ericsson Analysis Page 5

6 The mobile network is the most ubiquitous communication network we have applications have limitless reach is available and will be in operation for a long time users can focus on application, not connectivity will transition in a structured way well defined application enablement will scale with costefficiency and maintained performance the global vehicle for 50B connected devices Page 6

7 Market perception M2M challenges MARKET PERCEPTION CHALLENGES OPTIMIZED M2M STRATEGY BUSINESS MODEL CHALLENGES PRODUCT LIFECYCLE MISMATCH 50 Bn SCALE BUSINESS AND YOUR NETWORK FOR M2M OPTIMIZED FOR M2M BUSINESS MODELS COMPLETELY DIFFERENT HUGE ROAMING COSTS M2M CUSTOMER OWNERSHIP NON CORE OF MNO BUSINESS PROFITABILITY Is operator s business and network ready to scale billions of connections? Page 7

8 Key operational processes, from business strategy to system support Conceptual overview of operational processes varies operator-by-operator basis Strategy Formulation Commercial offering Technical Architecture & Implementation Operations Page 8

9 technical architecture & implementation Solution diversity Customization Complex integrations New requirements Considerations vertical business: Vertical solutions are often very diverse: Consists of various technologies & applications Customization & complex integration: Long integration time, typically 6-24 months per customer New requirements: Billing, provisioning, roaming etc. E.g. devices & SIM cards to tolerate vibration, humidity and high temperatures What are the current technical capabilities and do they fulfill the customers needs? Page 9

10 operations High volume, low ARPU business Operational efficiency End-to-end support Considerations vertical business: M2M ARPU often 10% of mobile ARPU: Challenge to cut & maintain low OPEX Process optimization through outsourcing Business critical solutions: 7/24 hour support required end-to-end Solutions have to work end-to-end: Management of 3rd party solutions Partner management Many choices in complex operational environment, which are the key opportunities for you to improve operational efficiency? Page 10

11 Handle Device scale Page 11

12 M2M scaling challenges M2M DEMANDS OPTIMIZED M2M STRATEGY WHERE ARE THE CHALLENGES? DEVICES WITH DIFFERING DATA DEMANDS 50 Bn SCALE BUSINSS AND YOUR NETWORK FOR M2M OPTIMIZED FOR M2M E2E QoS ON CRITICAL M2M SOLUTIONS LIMITED REVENUE PER CONNECTION M2M SCALING NETWORK CAPACITY ABUSIVE M2M DEVICES SIGNALING THE NETWORK M2M ROAMING Is your business and network ready to scale billions of connections? Page 12

13 Mobile Networks Meet the Demands of 50B Cloud computing efficiency Protecting vertical markets Business models Transparency Charging - INTERNET - WIRELINE - WIRELESS CARRIER Number of concurrent users Coverage requirements Massive data volumes CORE SERVICE LAYER RAN Users always connected RAN backhaul capacity Network scalability Transport capability Shrinking RNSs Signaling load Simultaneous growth in all dimensions Huge amount of devices, applications, vendors Non-homogenous requirements Different traffic models Page 13

14 M2M NETWORK CAPACITY P2P (6B) M2m (50B) Forecast Plan & Design Terminal Distribution, User Pattern, Trends & Application Characteristics Long term planning, Optimal Design & End-User Performance Device Characteristics & Growth, Application Characteristics & Traffic Model Optimal Network Utilization, Key Capacity Indicators & In-service Perf. Deploy Secure E2E Network Capacity, Quality Focus & Flawless Execution Secure E2E Network Capacity, Adherence to Methods & Procedures Measure & Tune Monitor alignment to predicted result, Update model & ensure capacity margin Monitor resource utilization, tune based on trends & intelligent mgmt. of devices RAN CORE SERVICE LAYER - INTERNET - WIRELINE - WIRELESS CARRIER Page 14 SECURE END-TO-END NETWORK CAPACITY

15 Managing the Smart Phone Experience Page 15

16 Beyond Smartphone, Managing M2M Performance The Heart rate monitor has to work at the same Time as the you tube video Network Planning QOS DEVICES WITH DIFFERING DATA DEMANDS (EXAMPLE).. Smart Meters (PTP) Transport Logistics Health Monitoring Usage: Data volume per session, Number of sessions, Interval between sessions Low Device Types, Number of Devices High Mobility Aspects Throughput, Latency, Reliability, Security & Coverage Requirements Page 16 LONG TERM FORECASTING CAN REDUCE WASTED SPEND!

17 GUARANTEEING THE DEVICE EXPERIENCE! Joint review with customer Kickoff and Initial discussions - Requirements Analysis - Design Considerations - Trend Analysis, Traffic Model - Capacity & Performance Targets - Device & Application Characteristics - Network Evolution Strategy - Develop Traffic Forecast - Develop Load Forecasts for Network Nodes & Interfaces Joint review with customer Perform Bottleneck analysis to improve service quality / device experience Validate network impact, based on forecast Iterate Model for optimal utilization (load balancing & Rehomes) Ensure solution meets requirements and aligned with customer expectations Review of Traffic Forecasts & Network Capacity Requirements Review Solution - Review Solution with customer - Address concerns and align with customer input - Build High level plan for Network Evolution - Deployment roadmap for capacity augmentation Customer Approval for recommended solution Document guidelines & best practices Page 17 MANAGING DEVICE EXPERIENCE IS A CONTINUOUS BEST PRACTICE ACTIVITY

18 M2M Service quality optimization Performance Issues Like finding needle in a haystack. A variety of devices with many different requirements Our Approach Passive probing: track each device/ application Assess network performance vs. expectations Value > Deliver observability on device experience > Discover requirements of M2M > Understand impact of network performance on device experience > Identify performance bottlenecks Page 18 MANAGING DEVICE EXPERIENCE IS THE KEY

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