AGH University of Science and Technology

1. AGH University of Science and Technology WP2 A 2.3: Techno-economic studies and evaluations Current Status and Workplan Jan Derkacz derkacz@kt.agh.edu.pl

2. Plan • Confirmation of partners involvement • Summary of main objectives • Current state of A 2.3 • Techno-economic case studies – Methodology • A 2.3 Glossary • Next steps

3. WP2 A 2.3 – Main objectives & subactivities

4. Partners invovement – Network planning ·Requirements and specifications for required planning and evaluation tools [BUTE ?, …] ·Definition of advanced network planning techniques which include cost transmission evaluation with different cost models in different scenarios [Telefonica] ·Advanced network planning techniques in order to support strategic decisions. Research of planning techniques by developing planning algorithms [IMEC, AGH] ·Planning methods for dynamic multi-layer networks [T-Systems] ·Algorithmical network planning method which considers the daily changes of the traffic matrix [Ericsson H] ·Network extension aspects and network planning strategies when traffic changes year by year [Ericsson H] • changes\uncertainty of traffic matrix • network extension requirements ·Definition of new strategic planning approaches taking into account: uncertainty in traffic forecast, cost evolution [TILAB] ·Optimal Placing Grooming Nodes within a Network [BUTE]

5. Partners invovement – Migration scenarios ·Definition of near, mid and long term migration scenarios based on the results of different WPs, cost trends, technology availability [Telefonica] ·Definition of Cost and technology trends [Marconi , AGH] ·Traffic and services forecast [Telenor ] ·Definition of potential market segments [AIP]

6. Partners invovement – Cost/Performance valuations ·CAPEX Cost model definition [AGH, TILAB, ..] ·OPEX Cost model (Methodology : questionnaire) [IMEC] ·OPEX modelling and calculations with focus on Metro solutions [Telenor] ·CAPEX cost study for link-by-link vs end-to-end grooming [IMEC] ·Techno-economic case studies in order to find efficient network solutions and evaluate their economic viability considering both CAPEX (CAPital EXpenditures) and OPEX (OPerational Expenditures) costs. Case studies of IP over optical networks (network dimensioning and CAPEX evaluation) with different aspects of layer 1 securisation (dynamic restoration, shared protection, 1+1,...) [TILAB, FRTD, AGH] ·Efficiency studies for transport networks offering dynamic service provisioning [T-Systems] ·Resource and performance comparison of static versus dynamic networks [T-Systems, AGH] ·The impact both in CAPEX and OPEX of introducing the technologies proposed by NOBEL in the telco network, mainly based on predefined network migration scenarios [Telefonica] ·Find the optimum solution to aggregate the traffic from access networks and valuate it with more classical approaches [Alcatel CIT] ·How will advertised costs/weights influence the utilisation and incomes of an operator, i.e., how will these costs/weights impact routing in an interdomain environment where domains are run by different competing operators.[BUTE]

7. Partners involvement - Output and interaction with other WP2Activities ·Analysis of impact of control plane technologies on business models of operators, carriers, and bandwidth brokers [Siemens AG] • The impact of a pricing model on dynamic traffic [IMEC] • Business case results analysis and evaluation [Telenor] • Potential analysis for dynamic service provisioning business models [T-Systems] • WP2 A 2.3 guidelines to A 2.4 and A 2.5 [All]

8. WP2 A2.3 - Current state • A 2.3 planned to start at M7 • Preparatory activities: • Elaboration and submission of a document formulating questions and open points to WP1:WP2A23_Request_to_WP1_v001.doc • OPEX questionnaire • Elaboration of methodology for techno-economic case studies • Definition of common understanding of key terms (Glossary) • Modifications to WP2 workplan

9. Techno-economic case study Methodology • Initial proposals • Telenor: NOBEL-WP2-A23-methodology-4-TEA-Telenor-v001.doc • Comprehensive approach to planning and evaluation activities, criteria, expected results, etc. • IMEC: Contrib_A2.3_IMEC_v1.0.doc • Definition of planning approach considering different time horizons for demand forecasting and network equipment extensions • Tarrification perspective • AGH: WP2_A23_Meth_v0_01_AGH_20040501.doc • Overall approach proposed for the Techno-economic case studies

10. Techno-economic case study General approach

11. General approach • Network Scenarios – technological solutions considered for the network. • Network Layers controlled in the network nodes • Topology and homing rules • Network Functionality (Intelligence) • Resilience Requirements • Routing Specification • Service/Application Scenarios • Definition of services/applications • Penetration • Traffic distribution and time characteristics

12. General approach • Cost model: a metro/core network cost model corresponding to predefined network scenarios • For planning purposes • For valuation purposes • Migration Scenarios: • near, • mid • long term migration scenarios specified in respect to cost trends, technology trends and services forecast.

13. General approach • Cost model: a metro/core network cost model corresponding to predefined network scenarios • For planning purposes • For valuation purposes • Migration Scenarios: • near, • mid • long term migration scenarios specified in respect to cost trends, technology trends and services forecast.

14. General approach • Strategic Planning: based on near, mid and long term requirements resulting from • Costs • Technology trends • Services

15. Technical Service oriented QoS parameters ... Network oriented Scalability Feasible migration paths ... Economics CAPEX OPEX Tarrification Revenues Deployment time Expected results

16. Network/Service/Application Scenarios Planning Requirements Cost Model Case Study Definition (Business Case) Migration Scenarios Def. Planning Algorithms Valuations Criteria Definition Strategic Planning Cost/Performance Valuations Iterations/Sensitivity analysis Interpretation of Results – Guidelines to other Activities Task sequence

17. Tasks Network/Service/Application Scenarios Output from WP1 Planning Requirements Requirements and specifications for required planning and evaluation tools [BUTE ?, …] Cost Model CAPEX-OPEX model definition [AGH, IMEC, TILAB, Telenor..] Migration Scenarios Business Case Definition • Definition of near, mid and long term migration scenarios based on the results of different WPs, cost trends, technology availability [Telefonica, Marconi , AGH] • Traffic and services forecast [Telenor ] • Definition of potential market segments [AIP] Partners interests-involvement mapping Partners involvement

18. Planning Algorithms/ Strategic Planning • Definition of advanced network planning techniques which include cost transmission evaluation with different cost models in different scenarios [Telefonica] • Advanced network planning techniques in order to support strategic decisions. Research of planning techniques by developing planning algorithms [IMEC, AGH] • Planning methods for dynamic multi-layer networks [T-Systems] • Algorithmical network planning method which considers the daily changes of the traffic matrix [Ericsson H] • Network extension aspects and network planning strategies when traffic changes year by year [Ericsson H] • Definition of new strategic planning approaches taking into account: uncertainty in traffic forecast, cost evolution [TILAB] • Optimal Placing Grooming Nodes within a Network [BUTE] Partners interests-involvement mapping

19. Planning algorithmsStrategic planning • Methodological approach • Development of planning algorithm • Time constraints (M12??) • Functionality • Uncertainty in traffic forecast, • Cost evolution • Considered technical solution • Using of existing tools/algorithms • ???

20. Valuations Criteria Definition Cost/Performance Valuations • Techno-economic case studies for efficient network solutions and evaluate their economic viability considering both CAPEX (CAPital EXpenditures) and OPEX (OPerational Expenditures) costs. Case studies of IP over optical networks (network dimensioning and CAPEX evaluation) with different aspects of layer 1 securisation (dynamic restoration, shared protection, 1+1,...) [TILAB, FRTD, AGH] • OPEX valuations [IMEC, Telenor] • CAPEX cost study for link-by-link vs end-to-end grooming [IMEC] • Efficiency studies for transport networks offering dynamic service provisioning [T-Systems] • Resource and performance comparison of static versus dynamic networks [T-Systems, AGH] • The impact both in CAPEX and OPEX of introducing the technologies proposed by NOBEL in the telco network, mainly based on predefined network migration scenarios [Telefonica] • Find the optimum solution to aggregate the traffic from access networks and valuate it with more classical approaches [Alcatel CIT] • How will advertised costs/weights influence the utilisation and incomes of an operator, i.e., how will these costs/weights impact routing in an interdomain environment where domains are run by different competing operators.[BUTE] Partners interests-involvement mapping

21. Interpretation of Results – Guidelines to other Activities • Analysis of impact of control plane technologies on business models of operators, carriers, and bandwidth brokers [Siemens AG] • The impact of a pricing model on dynamic traffic [IMEC] • Business case results analysis and evaluation [Telenor] • Potential analysis for dynamic service provisioning business models [T-Systems] • WP2 A 2.3 guidelines to A 2.4 and A 2.5 [All] Partners interests-involvement mapping

22. Techno-economic analysisGlossary • Glossary, division: • Techno-economic analysis – methodology • Network Functionality • Services & Applications • Service/network provider’s entities

23. Techno-economic analysisKey terms (NOBEL-WP2-A23-methodology-4-TEA-Telenor-v001.doc) • Techno-economic analysis • Network planning • Business case • Business model • Revenue model • Scenario • Cost performance valuation • Cost model • Migration scenarios / Roll out plan • Study period • Learning curve

24. Techno-economic analysisKey terms • LION definitions • Context defines the geographical environment and the requirement of the network at the highest (IP) level. Traffic requirements are between a given set of network sites at IP level (routers, content servers ) and they can be defined separately for each class of application/service. • Scenario identifies the technological solution chosen for the network. More precisely It involves the multi-layer protocol stack specification. (IP over SDH over WDM, for instance). • Case Study defines a network to be studied and implies the detail on architecture and topology. For example it defines if the topology is a ring or a mesh and chooses the type of apparatus employed at each level (for example add drop multiplexers or cross connects).

25. A 2.3 - Next steps • General issue: assign a leading partners for subactivities? • Consolidation of the Methodology & agreed A 2.3 Glossary => Update of the A 2.3 Workplan (M6) • Given the output from WP1 – specification of Network, Service and Application Scenario (M6 ?) • Cost model and Business Case definition (M7) • Planning Algorithm definition, Migration Scenarios (M9) • Plannign activity (M10) • Preliminary results valuations (M11) • D15 (M12) • IR – Final guidelines to A 2.5 (M20)