FTTH Council MENA Webinars SeriesSource: IDATE DigiWorld, World LTE Markets -5G Initiatives & MBB Spectrum, December 2017 LTE subscriptions estimates (million SIMs) • LTE inMENAisgrowingrobustlyinterms

www.ftthcouncilmena.org

FTTHCouncilMENAWebinarsSeries5GenabledbyFTTHintheMENAregion20June2018



Ø 20-25 minutes presentationØ 15-20 minutes Q&A

Ø Please write your questions in the question box of the webinar systemØ Relevant questions that are not answered during the webinar will be answered

by email

Ø The slides will be available for download after the webinarØ The webinar is recordded and can be viewed as video-stream afterwards. The

video will be available on the website of the FTTH Council MENA within one week

Ø Slides and information about the availability will be sent to registered attendees by email


@ftthcouncilmena

ModeratorPresenterPresenter

Roland MontagnePrincipal AnalystDirector Business Development

Vanesa DiazT&T Committee l FTTH Council MENA Market Development Manager EMEA

CORNING

Christine BeylouniDirector General l FTTH Council MENA

Today’s Webinar and Presenters5G enabled by FTTH in the MENA region


Smartphones allow mobile operators to enter into the Gigabit race

1980 1990 2000 2010 2020 2030

Research & Standardization

Commercialization

AMPS, NTM1G • Analog voice

GSM/GPRS/EDGE2G • Digital voice

WCDMA/HSPA3G • Mobile data

LTE/LTE Advanced4G • Mobile broadband data

How does MENA region position globally on LTE technology?


LTE global picture: momentum in MENA is really tangible

Source: IDATE DigiWorld, World LTE Markets - 5G Initiatives & MBB Spectrum, December 2017

LTE subscriptions estimates (million SIMs)

• LTE in MENA is growing robustly in termsof subscribers and deployments• 50,000 LTE subscribers as at YE2016

• 90,000 as at YE2017 (+80% AGR)

• >400,000 subscribers expected at YE2021

• LTE in Africa is also spreading

050100150200250300350400450500

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

• LTE has been launched by 164 operators in 58 countries in MENA (incl. FWA networks)*

• Many LTE drivers • The price of LTE handsets has come down significantly• Mid-range devices have arrived. Fixed networks are unable to meet the broadband

demand• Although spectrum availability and affordability have improved, they still remain a major

hurdle• Pricing and affordability of LTE data is another major challenge LTE roll-outs in 2018 in MENA

Source: IDATE DigiWorld, 2018

LTEnot-spotsLTEplansLTEcommercialLTE-Advancedcommercial

*Source: GSA 2018


5G is a Revolutionary Technology

• Enhanced mobile broadband data• Support extremely low latency transmission• Connect millions of low-bandwidth demand devices

5G

1980 1990 2000 2010 2020 2030

Research & Standardization

Commercialization

AMPS, NTM1G • Analog voice

GSM/GPRS/EDGE2G • Digital voice

WCDMA/HSPA3G • Mobile data

LTE/LTE Advanced4G • Mobile broadband data

Although 5G workable standards are expected by 2018-2020, mobile networks are already undergoing a network transformation in preparation for 5G


Multi-gigabit 5G is not only about very high data speeds

5Gparameters

• Multi-gigabitsuser/peakdatarate>10Gbps• Highmobility• Lowernetworkcoasts• Increasedconnectiondensity• Verylowlatency<1ms• 99,999%reliability• Lowenergyconsumption

• Newbusinessopportunitieswith5G• 3majorusagescenarios:

eMBB/MMTC/URLLC• By2035,5Gwillenable$12.3trillionofglobaleconomic

output,support22millionjobsandwillfuelsustainablelong-termgrowthtoglobalrealGDP

5Gusagecases

Source:ITU-TM.2083


Radio Access Network (RAN)

2G/3G/4G

Mobile and fixed networks are both wireless at the edge only

Fixed Network Mobile NetworkCore Core

Metro Metro

Fixed Access Network

xDSL xPON

Feeder

Distribution

Drop

xDSL, G.Fast


Centralized RAN

RRHRRH

RRHRRH

Fronthaul(CPRI)

Optical fiber

For applications/systems that need:• Super high data rate• Very low latency

Both Backhaul and Fronthaul Links will Coexist

BBU

BBU BBU

Distributed RAN

RRHRRH

RRH RRH

TDM/Ethernet

MSC

Backhaul

RRHRRH

For applications/systems that need:• Loose latency requirements• Low bandwidth

Optical fiber, microwave, millimeter or copper

BBUBBU


RRH RRH

RRH

The Value of Centralized RAN and Fronthaul Links

RRH RRH

RRH

Centralised BBU

RRH RRH

RRH

Fronthaul LinkCell Site

PerformanceInter-cell communicationVirtual-RAN enabled

RAN SimplificationTechnology agnosticFaster cell deployments

OpEx ReductionUp to 40-50% energy reductionReduced cell-site footprint

5G and IoT ReadySuper low latency

BBU3

BBU2

BBU1

MSC


How Much Fiber Fronthaul Links Need Varies

Fiber Rich(Dedicated) Fiber Optimized(Multiplexing)

PassiveWDM:onelambdaperRRHDedicatedP2Plinks:onefiberperRRH

• 2G=1RRH• 3G(1800&2100MHz)=2RRHs• LTE(800&2600MHz)=2RRHs

x3sectorialantennas=Total15RRHsx2CPRInobidirectional=Total30f

• WDMtechnologiesnotbidirectional• 1fibereachdirectionneeded

24-36fpermacrocellsite6-8fpersmallcell+12fibersfor5G

2fiberspersite

RRHRRH

RRH RRHRRH

RRH

BBUBBU

Operators’ choice will depend on rental expenses, electricity costs and fiber availability


Optical Fiber is preferred for both backhaul and fronthaul

Fiber Air

Global Mobile Backhaul Links

Global Mobile Backhaul Connections by Medium

Perc

enta

ge o

f Mob

ile B

ackh

aul C

onne

ctio

ns 100%

75%

50%

25%

0%CY15 CY16 CY17 CY18 CY19 CY20 CY21

Copper

• Fiber is increasingly used as a medium for backhaul connections

Source:IHS2017

Global Mobile Fronthaul Links

Num

ber o

f Fro

ntha

ulC

onne

ctio

ns

(Milli

ons)

0.8

0.6

0.4

0.2

0CY15 CY16 CY21CY20CY19CY18CY17

Fiber Air

• Fiber is the dominant medium for fronthaul connections


5G and FTTH are complementary technologies

Source: FTTH Council

Fixed networks: many operators are over provisioning fiber with spare ports left opened to be configured in the future as P2P connections

2. Both networks need fiber in the access

Mobile networks: 5G, densification and centralized architectures ultimately demand more fiber

56% 22%

22%

Cost Breakdown of FTTH Access Networks

Civil Works

Labor

Material

1. Telecom industry will have fewer players and thoseremaining will have both networks

VODAFONE – ONOSpain

EE – BTUK

Orange – JazztelSpain

VODAFONE – ZiggoThe Netherlands

Mobile Fixed MSO

Fixed TelcoMobile

Mobile Fixed Telco Mobile Fixed

MSO

It not longer makes sense to deploy fixed and mobile networks in silos, but to reutilize assets


Leveraging Passive Optical Networks (PONs)

EnterpriseResidential

Cell siteDAS

GPONOLT

DAS host unit

Central Office Cabinet

BBU

NG-PON2 and XGS-PON can be an evolution path

All fibers are combined on the same optical fiber (DWDM or CWDM)

Signal is split and distributed

By consolidating services into a single fibre network, users can increase bandwidth while reducing cost and infrastructure


Challenges surrounding 5G remain: spectrum, standardization, business models and use cases…

5G global picture: high potential for MENA on a long term, GCC on shorter term

Very heterogeneous regional overview

5G partnerships and trials: pace of times accelerated

• MoUs reflected in several trials validating technologies and requirements: latency, download peak speeds, Massive MIMO…

Almost no 5G plans so far for African countries• Especially where LTE services have not been launched at end-

2017

• Where LTE services are commercial at mid-2017 but for a relatively short time (2/3 years)

• Trials in South Africa started with MTN

Some 5G plans in GCC countries: pre-standard form starting 2019 in specific regions within the GCC and a commercial rollout to the wider metropolitan areas by 2019• One of the first region to launch LTE in September 2011; Deployment of

LTE-Advanced at a quick pace since 2014.

• Adoption of LTE services was slow at launch but take-up accelerated thanks to the growing penetration of smartphones, improved coverage and increased data demand

• In some countries, LTE-Advanced Pro has just been launched at end-2017 and VoLTE is alive

• Some players announced 5G plans, promoted 5G trials and results

• They want to maintain their LTE leadership in 5G

• 2019 is the year of launch in GCC : UAE, Saudi Arabia and Qatar ahead

• UAE: trials in 2017-2018, Etisalat first 5G commercial network? FWA services available in May, commercial services in September with fixed devices in selected locations, Due in 2019?

• Qatar: Ooredoo first 5G commercial network on 3.5 GHz band? No device available

• Saudi Arabia: STC launch of 5G network; devices to be available in 2019


Expected 5G timetables, compared

Rel. 14: 5G study items Rel. 15: first 5G stds Rel. 16: end 5G stds Rel. 17Rel. 13: 4G+

WRC-15 WRC-19

Technical requirements and evaluationmethodology Proposals Evaluation and specification

5G Technical trials

Japanese

5G R&D / 5G trials 5G implementation

5G product R&D trial

5G implementation5G R&D / 5G trials

5G trials Early commercial5G R&D

Pre R&D stds

Phase 2Phase 1 Phase 3

NSA implementation

2017 2018 2019 202020162015

Trials Pre-commercial

Korean

Pre-commercial


4G/5G spectrum issues in MENA

Source: GSA

UAE Cellular bands below 6 GHz

LTE roll-outs in 2016 in MENA

Source: TRA

In the MENA region, LTE is globally using:• 800/1800 MHz frequencies for LTE-FDD• 2300 MHz frequencies for LTE-TDD• 2600 MHz for both LTE-FDD and LTE-TDD

Need of low and high frequencies for 5G• Low frequencies for full coverage and capacity• High frequencies for very high data rates

Considered very high bands for WRC-19 studies (above 24 GHz)• 29.45 GHz already allocated to mobile on a primary basis• 3.6 GHz which require additional allocations to the mobile service

Bands identified at WRC-15 and likely to be identified for mobile atWRCs in EMEA

• Pushing 700 MHz identified at WRC-15• Pushing 3.4-3.8 GHz identified at WRC-15• Supporting 26 GHz as pioneer bands in ME and North Africa• Preliminary conclusions of the a group of regulators (ASMG) expected soon• 450-700 MHz likely to be considered at WRC-23

Indeed, the C-band likely to be a 5G band at regional level• Large blocks available• UAE: 3.4-3.6 GHz identified as prime 5G band, 3.6-3.8 GHz considered• Qatar on 3.4-3.8 GHz and mmwaves• Saudi Arabia: 3.6-3.8 GHz temporary licenses awarded for trials


The costs of 5G deployments vs. FTTH deployments

Source: METIS-II, D1.2 V1.0

A few estimated rough cost numbers for a whole network• 300 billion USD according to a 2016 Barclays report• 300-500 billion EUR according to Deutsche Telekom in 2017• 5G upgrades in EU28 estimated at 57 billion EUR by the EU Commission according to the

Financial TimesBig caveats on the CAPEX front

• Several spectrum bands used with implications on network deployment• A very high number of small cells• Re-use of older network equipment such as backhaul, software-reconfigurable technologies

used in 4G and 5G• Use of active antennas, more expensive than current ones• Sharing…

Source: Analysis Mason,2016, Costing the new potential connectivity needs

Standalone costs, sharing included

Wireless infrastructure

Fibreinfrastructure

Additional costswithout sharing

44

38

8111

Tota

l Inv

estm

ent c

ost

(EU

R B

illion

)

Macro cell Small cell

73

But some preliminary techno-economic studies…subject to uncertainties & assumptions!• Cumulated discounted cash flow analysed by the 5G PPP METIS-II projecs

− Access and backhaul network CAPEX and OPEX considered only (core network, commercial expenditure not included)

− Launch in 2021 in a European market for a dense urban area (where it is more profitable)− In all situations, 5G deployment is financially profitable for a MNO in dense urban areas

(under defined traffic and costs assumptions)• Total investment cost modeled on a standalone basis (Analysis report, 2016) to reach population

coverage of:− 95%: 55 billion EUR ow 11 for the fibre infrastructure− and of 100%: 119 billion EUR ow 81 for the fibre infrastructure− Underlying hypotheses: cost of a small cell at 1,000 EUR in 2025 due to high volumes, 50%

of cells connected via fibre.50 Mbps delivered. Radius of small cell=200m


5G enabled by FTTH in the MENA region Summary

• 5GandtheIoT aredrivingultra-dense,superhigh-speedlowlatencynetworks

• Mobilenetworksmustevolve:

• DistributedRAN(withbackhaullinks)à CentralizedRAN(withfronthaul links)

• Fronthaul linksrequireopticalfiber– howmuchdependsonP2Pvs.multiplexing

• Forefficientnetworkoperation,Mobilevs.Fixedsilosmustworktogether

• Fixed-MobileNetworkConvergence:savesdeploymentcostsintheaccessmakingapositivebusinesscaseforfibertoultimatelymake5Gareality

• TimehasacceleratedinGCCcountries.TheMiddleEastgetsreadyfor5G…

• Butitissoearlythannoonecanuseitwithoutany5G-compatiblehandsets,expectedin2019

• Africancountriesarelaggingbehind.


Q&A


Thank you for your attention!

Documents

FTTH Council MENA Webinars SeriesSource: IDATE DigiWorld, World LTE Markets -5G Initiatives & MBB Spectrum, December 2017 LTE subscriptions estimates (million SIMs) • LTE inMENAisgrowingrobustlyinterms