|Asia-Pacific II 2006
|Network intelligence and personalization
|Vice President, Service Provider Operations
|Asia Pacific at Cisco Systems
David Caspari is Vice President of Service Provider Operations, Asia Pacific at Cisco Systems. Prior to joining Cisco Systems, Mr Caspari was Vice President, Wireline Networks, Asia Pacific at Nortel Networks, responsible for the Asia Pacific service provider voice, data, and broadband and convergence business. He worked for Bay Networks until Nortel acquired the company. Mr Caspari started his telecommunications career as a cadet engineer at Alcatel and has held numerous management roles in marketing, product management, engineering, business strategy and sales management. David Caspari holds a Bachelors Degree in Electrical Engineering from the University of New South Wales, Australia. He has completed postgraduate studies in Business and Marketing with the Australian Graduate School of Management and the Richard Ivey School of Business (University of Western Ontario, Canada).
Fixed voice revenue decline is forcing service providers to look to new services for revenue growth. Data provided hope until competition increased. Today, broadband data penetration exceeds 65 per cent in several parts of the Asia Pacific region and growth has slowed. Value-added services, and the differentiation and personalization of services can provide growth. This, however, calls for Next Generation Networks, NGN using the Internet Protocol and integrating intelligence into the network. NGNs will make the delivery of tomorrow’s services possible.
This is a challenging time for service providers. This is also an opportune time for service providers to re-evaluate their business model and re-invent their service offerings.Fixed voice revenue is declining so service providers have to look to other services to make up the revenue loss from the drop in voice business and to find the new growth opportunities and revenue that shareholders are looking for. This is a worldwide phenomenon, and the trend is even more visible in the Asia Pacific region than in many other parts of the world. Moving to data was the trend a few years ago. Broadband investment was clearly the right thing to do. However, telephone companies, cable companies and alternative providers soon started to compete to deliver data to the consumers. As the penetration rates for data transmission began to reach higher levels – the competition within each regional market to obtain and detain the available customers became more intense, price competition set in and broadband prices started to erode. In the Asia Pacific region, Korea, Hong Kong and Singapore have already reached broadband penetration rates of 65 per cent or more. In Hong Kong alone, we see PCCW, iCable, HKBN and Hutchison all trying to compete on the pricing of their broadband services offerings; HKBN is offering services for as low as HK$ 80. Initially, the question for the market was who could offer the most bandwidth, affordably, to the consumer. Hutchison offered 10Mbps symmetric service and HKBN offered services that delivered up to 1Gbps. Pure bandwidth alone, however, was not the answer as more and more service providers were coming to the market with their own competitive bandwidth services. Another alternative was to offer a variety of broadband enabled value-added services such as voice, video and applications. Now, you commonly see triple play (voice, data and video) service offerings in the more mature markets. Recently, quadruple play services -voice, video, wireless and data – have begun to show up in some marketplaces. How can service providers survive in today’s highly competitive world? Differentiation and personalized services are vital. By differentiating their service offerings from those of their competitors – by providing unique signature services – service providers can more easily attract new users and retain their existing customer base. Special services, application, entertainment offerings and the like, especially those that cannot be easily copied by the competition, are what differentiate one service provider from another. What is personalization? Consumers want to be able to access, to download – at anytime from wherever they may be – any movie, music, or information from the vast database that Hollywood and the entertainment, education and news industries have made available. The ability to select a range of entertainment, programming and content according to the subscriber’s own unique tastes and interests, instead of passively receiving whatever is on the TV, is one form of personalization. An example is personalized VoD, video on demand. Personalized VoD services have been around for a while especially in Asia Pacific. Service providers like HKBN, CHT, Singtel and PCCW have been offering these services for many years. The popularity of this service, where obtainable, is due to the vast amount of content the consumer can access at a reasonable price. Another sort of personalization lets the subscriber maintain contact with his preferred communications media through a personalised portal combining entertainment channels, telephone access, email, and SMS, short message service so that all services are constantly available for use, simultaneously, according to need. Taylor-made experience A third way to personalise the subscriber experience is to provide a unique, tailor-made user experience. This goes beyond the sort of personal pick and choose content arrangement available from, say, VoD. The specific programmes and content that the subscriber wants to see each day are made available on every device the user might wish to use, for example, his PC, mobile phone or TV set. This sort of personalization was recently shown at a cable industry show in the United States where the Sprint and MobiTV consumer offerings were demonstrated. Using a Sprint CDMA handset, consumers could remotely program their DVRs, digital video recorders, view programs that they had recorded on their DVR using their handset and, as well, view SMS text messages and MMS picture messages on their home TV. A recent Berstein Research report said: “New applications such as Skype video, SlingBox, and local video content is changing the traditional network traffic patterns and generate significantly different types of users. Service Providers would need control over the type and amount of data going over their networks, causing service providers to migrate to an ever more intelligent network infrastructure. Most types of personalized content (e.g., live interactions, mobile access to personal video libraries) render caching impractical and will therefore generate bandwidth demand in the core of the network.” The challenges on the networking side include providing the scalability needed for new business models and overcoming the last-mile delivery constraints that can effectively limit the viability of offering bandwidth-intensive services to the subscriber. Linking the key architectural elements together to support not only video, but also data, voice and mobility is also a challenge. These are not easy issues to resolve, but they must be resolved to provide the unique user experience the market demands. Then too, there is the fundamental matter of being able to deliver high quality video, considering the QoS, quality of service, constraints of the medium. Video is arguably the most challenging service to deliver. Although email and web surfing can deal with fair amounts of packet loss -with little impact upon the result, and without being apparent to the user – video cannot. Even relatively low rates of packet loss can produce substantial effects, such as pixilated high definition or a jittery picture, that greatly affect image quality and can seriously mar the viewing experience. NGN and IPTV Intelligent networking is a strategy for integrating intelligence in the network. It provides an environment for non-traditional networking components, such as servers and software, and creates a new platform for more reliable, secure and collaborative business process optimization. It can serve as the basis for a comprehensive architecture for all user segments – for the enterprise, the consumer and the service provider. Next Generation Networks, NGN, based upon the use of the Internet Protocol, IP, serve as the starting point for intelligent information network architectures for service providers. NGN and IP make innovative, converged infrastructures that enable more efficient and effective delivery of current services possible. These networks also provide the means to support and deliver tomorrow’s new, application-intensive, business and residential services. With NGN and intelligent information networking as a basis, advanced platforms can integrate security, QoS features, and much more, throughout the NGN architecture’s network, services and application layers. By making use of networks with ever greater amounts of fully integrated intelligence, service providers can more efficiently leverage their service platforms and better build their businesses. With networking innovations, expertise and experience better ‘glass-to-glass’ -from the glass of the camera’s lens, to the screen of a content source, to the glass of the television screen – integrated solutions become possible. These solutions, wide-ranging and broad in scope, tend to be highly scalable, open and flexible so that providers can more effectively customize and differentiate their offerings in the market place. Given the many advanced features these solutions make available, service providers can achieve the economies – of scale and efficiency – their business models call for. To succeed, service providers need to build extensible and efficient networks with faster, smarter, lasting packet infrastructures that progressively increase return on investment and reduce operating expense. The networks must be able to support the advanced services they must offer to remain competitive. Wide-ranging and flexible service creation and deployment is needed; this helps service providers capture new revenue streams and expand their market. Altogether, the service provider’s goal is to deliver a better, more complete experience to its end customer, to deliver ‘many services to many screens’, whether at work, on the road or at home.