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How to manage ever growing user expectations in a cost-efficient way
The Connected Home paradigm
Bart Vercammen
Director of Product Management
Service Gateway BU
Market trends
What is happening out there ?
Economic climate
3 9/28/2011
Source: Business Week, Wall Street Journal, Economic Times, Bloomberg
Source: Bloomberg, Reuters
Declining Subscriber net adds
• EMEA and NAM reaching point of saturation
• Growth has to come from
• Customer acquisition (Churn) - Increasing ARPU
• Technology replacement
• Expanding geographical scope
• consolidation
• APAC BB market keeps growing
BroadBand Market
4
Source: Dell‟Oro Q2 2011
0
5.000
10.000
15.000
20.000
25.000
30.000
35.000
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
net adds by region
NAM EMEA APAC RoW
Market liberalization increased competition, even in growing APAC market
9/28/2011
Consumers needs
Market Pressure
5
Richer user
experienceEfficient time spending
(work and leisure)
Value added servicesPersonalized
content &
sharing
Technology complexity and shorter Product Life Cycles having impact on costs
9/28/2011
Anytime,
anywhere, on
more screens
Spending on basic connectivity
Additional NSP services(ambition)
Pressure on ARPU
6
Market Pressure
ARPU divide over time
• Revenue from basic connectivity flat or declining
• Compensated by additional services (e.g. digital TV)
• New players take a bite from the ARPU cake
9/28/2011
Google MVNO?
Remote access
All this translates into “The Home”
7 9/28/2011
DSL
Fiber
cableWANLTE
Remote access
All this translates into “The Home”
8 9/28/2011
DSL
Fiber
cableWANLTE
• More complex Home environment poses bigger challenges
for NSPs
• NSPs are the place to be in case of trouble, even though
they are not responsible for it
Impact on
OPEX24% 23%
NSP Challenges
What are the implications for NSPs ?
Bottom-line result for NSPs
10 9/28/2011
11
Balancing between Revenue and Cost
COSTREVENUE
9/28/2011
How can the introduction of new products, services and applications increase revenues and the life-time value of
a customer while keeping the costs of operations under control?
12
Balancing between Revenue and Cost
COSTREVENUE
9/28/2011
How can the introduction of new products, services and applications increase revenues and the life-time value of
a customer while keeping the costs of operations under control?
How can the introduction of new products, services and applications increase revenues and the life-time value of
a customer while keeping the costs of operations under control?
COSTREVENUE
13
Balancing between Revenue and Cost
9/28/2011
How can the introduction of new products, services and applications increase revenues and the life-time value of
a customer while keeping the costs of operations under control?
14
Balancing between Revenue and Cost
9/28/2011
How can you lower your service costs substantially?
How can you keep up with the proliferation of
devices and technologies in the market and assure
that your network is always up to the latest
standard?
How can you build and ecosystem of partners and
applications in order to increase the switching
costs of your current users and make them more
loyal?
How can you introduce new services to the
market faster so you can keep ahead of
competition, but still in a reliable way?
COSTREVENUE
15
How NSPs balance between Revenue and Cost
COSTREVENUE
9/28/2011
Source: Belgacom
Churn reduction
OPEX
Source: Deloitte, 2009
ARPU increase
CAPEX
Source: France Telecom, Deutsche Telecom,
Telenor, Tele2
Technicolor view
How can NSPs deliver on their marketing message ?
How can NSPs control their OPEX ?
3rd party applications
Openness + Robustness + Security = …
17 9/28/2011
Open Digital Home platforms need to be open towards various parties
so VAS can be developed/created. Openness needed to guarantee TTM
Robust Your VAS cannot impact the Customer Value and Perception of your basic
services offered
Secure Opening up needs full enhanced Digital Home security that
extends beyond the devices to safeguard the integrity of the various apps
Openness + Robustness + Security = prerequisite for creating an ecosystem
with value added services without compromising the basic offering
Full Digital Home interaction
18
All content and all interactions available
seamlessly on every device in the
home
9/28/2011
Efficient & userfriendly problem resolution
19 9/28/2011
Intuitive user
interaction
Smart Self
resolution
Straightforward interaction with the Digital Home so helpdesk
calls are avoided
Efficient & userfriendly problem resolution
20 9/28/2011
Intuitive user
interaction
Smart Self
resolution
Fast problem
resolution
When minor issues arise, the digital home is intelligent to
propose solutions and solve the problems
Efficient & userfriendly problem resolution
21 9/28/2011
Intuitive user
interaction
Smart Self
resolution
Fast problem
resolution
Specialized
intervention
When helpdesk intervention is needed, real-time diagnostics
of the full Digital Home ensure fast problem resolution
Efficient & userfriendly problem resolution
22 9/28/2011
Intuitive user
interaction
Smart Self
resolution
Fast problem
resolution
Specialized
intervention
In case of severe issue, intervene in the Digital Home through
Diagnostic OSGi bundles and solve the problem
User friendly experience
Self care
Limit helpdesk calls
First time problem resolution
Seamless and fast service upgrades / roll-outs
9/28/201123
Add new building blocks easily, without impacting other
components
• No service interruption for the consumer
• Reduced downtime
Faster time to market
• Increased flexibility
• Short testing cycles
• Modules dynamically installed from Backend
• `
From „Home‟ to …
24
Back-end
Remote access and control
DSL
Fiber
cable
LTEWAN
3rd party vendor portal
Helpdesk
NSPs portal
NSP backend
Selfcare
9/28/2011
Personal Media Manager
Digital Home
‘Digital Home’
Thank you for your attention
Bart Vercammen
Director of Product Management
Do you have any questions?