Nokia next generation PON - Finnet-liitto

1 1 Nokia 2015 Nokia next generation PON Ana Pesovic, Fixed Networks Marketing Nokia October 2016 Speed & .. convergence define the access network of the future Eric Festraets - Director Business & Network Strategy Fixed Networks 2 Nokia 2015 Speed & convergence define the access network of the future View on technologies View on FTTx deployments View on apps & services Fibre as the cornerstone of the network Better quality of Fixed complements 3 Nokia 2015 Speed & convergence define the access network of the future View on technologies View on FTTx deployments View on apps & services Fibre as the cornerstone of the network Better quality of Fixed complements 4 Nokia 2015 Prediction is very difficult.

2 Especially about the future. Robert Storm Petersen Danish cartoonist, writer, animator, illustrator, painter and humorist The enigma of ever changing consumer 5 Nokia 2015 Backhaul Business (Retail & Wholesale) Residential (Retail & Wholesale) Main service trends for today and tomorrow GIGABIT Bandwidth vs. speed MULTI PLAY One stop shop Smart Home INTERNET OF THINGS Ecosystem FTT OFFICE Passive Optical LAN CLOUD IT Integration INTERNET OF THINGS New business models MOBILE X-HAUL Front/Mid/Backhaul WIFI OFFLOAD Seamless handover SMALL CELLS Coverage & Capacity 6 Nokia 2015 Video Bandwidth (Mbps) 0102030405060708090100201120122013201420 15201620172018201920204K 3D 2160p 4K TV 2160p 3 DTV 1080p HDTV 1080p 3 DTV 720p HDTV 720p SDTV 15% CAGR Sustained bandwidth BW Time Downstream average IPTV, Internet, voice Downstream peak OTT Video download Speed test Upstream average Gaming, Video communication Upstream peak Speed test Video upload File sharing Cloud storage Peak bandwidth High bitrates are required to provide premium customer experience and differentiate from competition Gigabit : how much do you really need?

3 7 Nokia 2015 Human impatience is the killer app for a gig -1500-1000-500050010001500HD video (4x)Web & Cloud appsHome security4K Video (4x)Online backup / storage8K video (4x)Virtual Reality (consumer)Immersive VRInstant GratificationCloud interactivityUpstream (Mbps) Peak bandwidth is key for the user experience (human impatience is the killer app) Sustained bandwidth (all users, all the time) is basic enabler Downstream (Mbps) 8 Nokia 2015 Multi play for the consumer From bundling to converged offerings TELEPHONE Voice services DUAL PLAY Voice services Internet services TRIPLE PLAY Voice services Internet services Video services QUAD PLAY Voice services Internet services Video services Mobile services QUINT PLAY Voice services Internet services Video services Mobile services Smart Home 1 2 3 4 5 Downgrade churn by targeting convergent households 9 Nokia 2015 Multi play for the consumer - The smart home challenge & opportunity Integrated ONT/RGW/IOT hub or Ethernet CPE/Gateway/IOT hub Single app in the mobile Multiple apps one per hub

4 Multiple hubs one per vendor Too many vendors/protocols/hubs/apps Simplified, integrated & handy Smart Home solution 10 Nokia 2015 Digital Health Health Efficiency Comfort Security Home Security Home Automation Smart Energy HOME SECURITY 36B worldwide market (@2017, Goldman Sachs) Proven willingness-to-pay by subscribers ENERGY MANAGEMENT IoT can make smart homes 40% more energy efficient In developed countries, 30% of energy consumption is in homes - significant overall savings! REMOTE HEALTH Remote patient / elder monitoring/assisted living Potential savings, just in North-America, $300B per year Opportunity (US alone) $30B Multi play for the consumer - Smart home service area s 11 Nokia 2015 Bringing a gig to every home is just the start PON, xDSL, DOCSIS, 3G/4G/5G, GE Wi-Fi IPTV, VoD, Internet TV, Gaming Home Security, Digital Health, Smart Energy.

5 Communication Home networking Home networking Entertainment Convenience Smart home Connected home IOT vSTB RGW ONT vRGW vSTB vIoT 12 Nokia 2015 ENHANCE CUSTOMER EXPERIENCE BUILD THE MODERN WORKPLACE ADOPT CLOUD SERVICES DIGITAL TRANSFORMATION OF ENTERPRISE MANAGE SECURITY & PRIVACY TRANSFORM IT CAPABILITY EXPLOIT BUSINESS INFO CONNECT PHYSICAL WORLD MODERNIZE LEGACY SYSTEMS Business & IT change significantly Need to find better ways to communicate & collaborate Connect people, offices & applications smoothly Can Slack replace email? By 2020, 62% of CIOs say running 100% of IT in the cloud 75% of M2M projects lead to new business models Data trust should be guaranteed in each Data Centre Customer Loyalty Programs rule 13 Nokia 2015 Horizontal and Vertical cabling using fibre instead of copper CATx cabling GE connectivity to ethernet devices Active Core switches replaced with single centralised node Aggregation switches replaced with (passive) splitters and CPE devices to terminate fibre Fibre to the Office.

6 Passive Optical LAN v s Traditional copper LAN Premium service experience High capacity, market proven solution All services converged on one LAN -voice, video, data, WiFi, surveillance, signage, etc Lower cost to operate Simple network, easy to operate Low power consumption Low floor space Long term solution Fiber life span: 50+ years Low cost evolution: -same cables -same access node 14 Nokia 2015 Fibre to the Office : 50% TCO savings with Passive Optical LAN Equipment Cabling Floor space Power Office building with 5 floors, 124 desks/floor -50% TCO 30 switches 1 fiber OLT + ONT access points 25m2 <1m2 Bulky CATx Cable bundles small-diameter fiber bundle Traditional LAN Passive Optical LAN 15 Nokia 2015 Internet of Things.

7 Opportunity to improve people s lives Fatalities each year worldwide by not following doctor s prescriptions3 Possible yearly economic impact of IoT applications in cities in 20256 Water lost each year in the US because of aging and leaky pipes, broken mains and faulty meters2 Estimated energy waste in US buildings due to inefficient and outdated HVAC systems5 gallons 1 mio 50% $ trio Fatalities in car accidents are often due to human error and slow reaction1 Mobile glucose monitoring tools can cut diabetes management costs by4 90% 50% 1 International Organisation for Road Accident Prevention; 2 NPR; 3 Huffington Post; 4 fiercehealthcare; 5 American Physical Society.

8 6 McKinsey 16 Nokia 2015 Internet of Things : validate the technically and marketwise Innovation ecosystem Agile prototyping Concept showcase Market trials refine Automo ti ve & trans porta tion Hospitality Health & wellness Media & entertainment Service providers Tech industry Consumer electronics E ducation Public sector Retail & e-commerce Ideate Prototype Test Business models Prototypes Execution partners Joined efforts of global leaders & innovators 17 Nokia 2015 Internet of Things : ecosystem to build the right partnerships 265 members 375 members/1500 products 450 members >550 members/>30,000 products ng connect program is Nokia initiative next to being part of Z- Wave / ZigBee / WiFi alliance 18 Nokia 2015 Operators massively backhaul their macro cell traffic over fibre Bus stops Lamp posts Advertising 92% of PT cell sites have fibre for mobile backhaul Adding small cells (+ wifi) Equip urban locations with fibre Wireless Backhaul.

9 Market clearly moves to fibre 19 Nokia 2015 Mobile Transport Fixed networks for backhaul/ midhaul, especially for smart cells Hybrid access Boost peak speeds with hybrid fixed/LTE CPE; instant activation; resilience & troubleshooting Fixed Wireless Fixed wireless LTE as primary broadband connectivity in hard to serve areas; 5 GTTH in ultra-dense urban areas, and for fast initial coverage Wireless complements fixed 20 Nokia 2015 Backhaul Business Residential All customer segments have their needs Enlarge revenue opportunities by combining B2C with B2B 21 Nokia 2015 Speed & convergence define the access network of the future View on technologies View on FTTx deployments View on apps & services Fibre as the cornerstone of the network Better quality of Fixed complements 22 Nokia 2015 Cloud Minimize TCO with an optimal mix of virtual and physical functions COPYRIGHT 2012 ALCATEL-LUCENT.

10 ALL RIGHTS RESERVED. Cloud & CO Edge Cloud Our vision: A seamless fixed network connecting everyone and enabling every thing vRGW vOLT vSTB Digital Home Bring gigabit into every home, and enable the Internet of Things Last mile Gigabit speeds over fiber, copper, coax innovation pushing the boundaries of physics Converged Access Range of ultra-broadband options to connect every home, enterprise, and antenna NG PON, 10G P2P XLG-PON Vectoring, Vplus, , XG-FAST XG-CABLE FTTA FTTN FTTx LTE, FastMile FTTH FTTDesk 23 Nokia 2015 Is all traffic going mobile? The facts and predictions Mobile share Wi-Fi will support >40% of data traffic Traffic by network type CAGR of 24% Wi-Fi data consumption/user : from 30M ( 13) to 300 M ( 16) (video) Source : OVUM UK, France & Germany leading countries Source : Analysis Mason For 2020, fixed will show stronger growth than mobile in most developed markets Smartphone boom nearly Heavy demand for video data : Despite 4G, economics drive to fixed Connected TV 24 Nokia 2015 3G :100s of nodes 4G :1000s of nodes 5G.