1© 1996 - 2007 Sigma Systems. Private & Confidential.

“Cable MSOs vs Telco – Who’s Winning and Why”

Brian Cappellani, Sigma Systems

Who is winning ?

• Depends who you talk to …..• Successes on both sides

Telco Successes

• Continued growth in HSD in North America– U.S. phone companies signed up at least 100,000 more high-speed data

subscribers than cable operators during the fourth quarter of 2006 1

– For the ninth time in the last 11 quarters, telcos beat their cable counterparts 1

– Now have close to 45% of market• Continue to dominate HSD outside of North America

– 65.7% global market share for DSL 2

• Getting video rolling– Statewide franchises in many states– Verizon FiosTV hits 25% penetration in markets where it is

introduced– IPTV successes in Asia PAC

1 Cable Digital News2 DSL Forum

Cable Successes

• VOIP continues to be a success– Customers in US accessing VoIP via their cable provider jumped 167% in 2006

from 3.9M subs to 6.3 M subs 1

– By end of 2007 Comcast will be fourth largest residential telco in U.S.• Now moving into business services

– Not just SMB VOIP– Cox is #4 in U.S. retail business Ethernet providers3

• Continue to lead on HSD in North America– Cable continues to lead the U.S. broadband access market by commanding 54

percent of total subscriptions 2

• Major operators now rolling out wireless with “Pivot” Brand• “SpectrumCo” now owns US spectrum

1 Yankee Group2 Strategy Analytics

3 Vertical Systems Group

Same Fears

• Fear being relegated to “pipe providers”– Access margins eroding

• Pressure from new and “Web 2.0” entrants

• Both recognize need to “evolve”

New Services Demand New Level of Agility

Increase Velocity of Service Introduction

Telecom IT Enabler Building Blocks New Services

Months/Years Days/Weeks

Define & re-use service & application building blocks & enablers

Provide appropriate simple, abstracted APIs

Make these enablers available both internally and externally to partners

Provide the capability to rapidly “on-board” new partners

7© 1996 - 2007 Sigma Systems. Private & Confidential.

Cable Operator Perspective

Brian Cappellani, Sigma Systems

Key Initiatives

“Keep pushing the bundle”• Continue with residential VoIP rollouts

– In 2007, Comcast added 2.4 M VoIP subs – now 4th largest residential phone company in US

– 80% of voice customers take all 3 products

• Expand On-Demand capabilities– Comcast had 1.9 Billion VOD views in 2006

• Roll out OCAP– Enable STB and application standardization, converged

delivery to STB

Commercial Services– SMB commercial VoIP– Data services

Wireless Integration

Key Challenges

• Is there a Bandwidth Gap ?– SDV, Micro Nodes, 1GHz overlays, DOCSIS 3.0

• Wireless Integration– Pivot rollouts slower than expected

• Need to transition existing OSS, systems and technology to support:– Converged services – Partner Integration– Rapid introduction of new products & services

10© 1996 - 2007 Sigma Systems. Private & Confidential.

Thank You

Brian Cappellani, CTOSigma Systems

brian.cappellani@sigma-systems.com416-365-3966

Telecom Carrier Strategy

Date: November 8, 2007

Arthur J Musgrove

Director, Network Operations Systems

TELUS

About TELUS (2006 Year End)

Revenue: $8.7Bn

Customers: 10.7M (4.5M wireline/5.1M wireless/1.1M Internet)

Incumbent in British Columbia, Alberta, and Quebec

About OSS @ TELUS

Integrated national capabilities

220 applications

340 employees and contractors

36 active implementation projects

Challenges & Opportunities

Erosion of traditional Local and Long-Distance business

Growth of High-Speed Data, Internet, Wireless, and IP-TV

Regulatory disparity

End of engineered and extended lifespans of TDM switches

High value in content services, but significant risk of entry (ie, Amp’d Mobile)

Ability to offer differentiated services, but with regulatory and market risks (ie, Net Neutrality)

Ever increasing connectedness, but point of value is always moving

Leveraging Natural Advantages

Brand confidence – quality, reliability

Experience in running services that do not tolerate outages – TV outages and 911 outages are different things

Tradition of innovation and technology leadership

Expertise in connecting people – two-way communication - its what we’ve always done

A part of our community

OSS Impact

Plug-and-play: providing and consuming services should be instantaneous and seamless

Changing the model: OSS models and manages the network, and so is the centre of the transformation from network-centric to service-centric

Assurance: guarantee quality and differentiate customers

Cost: make the best business decisions and optimize operational efficiency and effectiveness

Transparency: show the customer their service, let them change it

Questions