Today’s Carrier Business Challenges & Opportunities

1. Carrier Transformationvia Cloud Computing in ICTAnni LaiHead of Global Carrier Cloud, Business DevelopmentFuturewei Technologies, The North American Subsidiary of Huawei

2. Today’s Carrier Business Challenges & Opportunities Business Challenges • Experience more voice and data traffic but suffer from declining revenue • Face more competition from Enterprise IT vendors Business Opportunities via Cloud Computing in ICT • Improve internal IT efficiency and responsiveness • Offer more solutions and services to customers • Generate new revenue streams via technology innovations Carriers (Telcos, Operators, Service Providers, Hosters, etc)

3. Today’s Enterprise Business Challenges & Opportunities Business Challenges • Top concerns: • Cost • Integration/convergence of 3rd party and/or new services such as mobile, web2.0, etc • Global expansion • Turn CapEx to OpEx Business Opportunities via Cloud Computing in ICT • Improve IT efficiency and decrease operational cost • Increase business agility with charge-back and ROI calculation • Create efficient global IT, avoid IT in silo Enterprises (Banks, Retailers, Manufacturers, etc. SMB, SoHo, Enterprises Carriers and Cloud Providers sell to

4. IT & Business Transformation via Cloud Computing in ICT IT and BusinessTransformation IT Data Oriented ICT User Oriented Connectivity Network Oriented Carrier-grade Cloud Service Provider Infrastructure as a Service (IaaS) Platform as a Service (PaaS) Software as a Service (SaaS) Mobile apps Global business Increase New Revenue Opportunities Lower Operational Cost Infrastructure/Operational Optimization More capability and scalability Organizational agility Changed CapEx and OpEx , pay as you go More green Global IT Collaboration

5. Lower Operational Cost via Cloud Computing in ICT

6. Lower Operational CostCustomer Needs for ICT LOWER COST SIMPLE FASTER GREEN Cost Effective Simple Fast Green 1. Lower Power Consumption 2. Higher Efficiency 3. Environmental Friendly • 1. Capital Expenditure (Capex) • 2. Operating Expenditure (Opex) 1. High Reliability 2. Low Maintenance 3. Easy to Service 1. Construction Time 2. Deployment Time 3. Installation & Commissioning Concerns

7. Lower Operational CostBy Applying Cloud-enabled IDC • Higher Density • 3-6KW 9-15KW/cabinet • Lower environment requirement • Only a 2.8 m (9.19 ft) net height is required and the high support floor is not required. • Lower deployment cycle • 8-12 weeks deployment, save 20% cost； • Higher power efficiency • Uses the solution of the precise air supply system and air tight cooling duct，improve power efficiency by 30-50%，PUE under 1.5. IKEA style solution Modular DC Building block style solution： Container DC Standard config with 3 containers Savetime，SaveSpace，SaveTCO • Venezuela CANTV: • Save deployment time 6 months • Save 40% OPEX(5 years on electricity fee) • Improve storage resource utilization about 80% • China Telecom,Shanghai: • Deployment time 2 weeks • Save power 40% • PUE < 1.6 • CMCC Northern Base: • High Density: 9KW/cabinet • Save 30% OPEX • PUE<1.6

8. Lower Operational Costby Increasing Resource Utilization via Cloud Computing Shared Service Cloud Daytime Nighttime Plan Build Operate Cloud Data Center IaaS Elastic Computing Service (3rd party) In-house Desktop Cloud Cloud Management/Admin Tools & IaaS Portal Facility Storage Server Network Cloud Virtualization & Management Shared Service Cloud Platform Storage Resource Compute Resource Storage Resource Compute Resource 9pm 7am • Leverage computing resource at night time for Elastic Computing Service. • Improve revenue by 30% • Automatic scheduling by unified management system. Only 2 employee needed.

9. Increase New Revenue Opportunities via Cloud Computing in ICT

10. Increase New Revenue OpportunitiesCloud Opportunity Sizing “Cloud computing … has the potential to completely upend IT as we know it. … looking like a classic disruptive technology. ” – Forrester Market size is measured in Billions 2015 Forecast 2010 Revenue Source: Forecast: “Sizing the Cloud -, Gartner, 2011

11. Forecast For SaaS Delivery Enterprises Apps

12. Increase New Revenue OpportunitiesReasons Customers Buy IaaS and SaaS from Public Cloud Vendors Source: 2011 Cloud Networking Report by CA

13. Increase New Revenue OpportunitiesPossible Areas for New Revenue SaaS PaaS IaaS • Elastic Computing/VM • Cloud Compute • Cloud Storage • Cloud Network • Disaster Recovery • Cloud Desktop • Load Balance • Cloud Security Website Finance CRM • Develop and Test environment for SaaS • Force.com • MS Azure • Managed Services: Oracle DB, App Svr Digital Shopping Mall Mail ERP Data Analysis More Advanced Services. …. Convergence Communication Desktop OA Instant Communication Data Mining Behavior Analysis Conference Location-based Service Cloud Search Mostly for Carriers/Cloud Service Providers offer customers the ability to order VMs and additional managed services such as database, app servers Carriers and Large Enterprises can resell SaaS Services to their target verticals (E.g. Carriers: StarHub’s marketplace, Bell Canada’s marketplace, Enterprise: Bank of America’s SaaS market place for banking)

14. Increase New Revenue OpportunitiesAn Example of Service Package Charging Model Carrier B Service Offering Suite Accounting & HR CRM CRM $30 / User / Month CRM $66 / User / Month Accounting $29-$64 / Month HR Compliance $17 / User / Month Secure My Computer $3.30 / User / Month Email, Conferencing and Messaging Secure My Data Server 10GB – 1TN Plans PC 5GB – 50GB Plans Collaboration $9 / User / Month Email $10 / User / Month Instant Messaging $4 / User / Month Virus, SPAM & Data Protection Secure My Network $4- $8 / User / Month Full Collaboration Suite $17 / User / Month Web Conferencing $7.50 / User / Month Large File Transfer 10GB / $8 / Month

15. Increase New Revenue OpportunitiesAn Example of Bundling CT with IT Services Basic IT applications bundle with Voice and Data services Advance IT applications for separate charge

16. Increase New Revenue OpportunitiesHuawei CSB Platform Enables StarHub CSB aggregate Huawei & 3rd-party IaaS ＋ Huawei sales channels. CSB 3rd-party SaaS Carriers Value to developer/Channel/ISV： Focus on app/service development Expand market with low cost Potential massive market Value to Operator： Aggregation massive cloud services Time to market Low risk compared with self-development Chance to bundle CT services Value to Customer Change Capex to Opex based mode. One stop shop & service point. Freedom to try and select services. Focus on their core business. Huawei’s Unique Value 1) Cooperate with the global ISVs, Integrate various SaaS/IaaS services 2) Comprehensive go to market solution, including consulting and channels.

17. CSB Market Landscape Projected Growth • IaaS in the public cloud is the most commoditized cloud segment today. The emerging CSB model enables IaaS and more value to their customers and a way to differentiate themselves from their competition . • By 2015, the CSB vendor landscape will have grown from dozens to hundreds of providers. • By 2015, at least 20% of all cloud services will be consumed via CSBs, rather than directly, up from less than 5% today. By Gartner CSB report, 2011

18. CSB: Enable Telco to Build Cloud Marketplace Cloud Storage Video Surveillance Cloud Server E-leaning Unified Collaboration Websites Build Business Flow Vertical Industry Office suite IaaS Mail Security CSB(Cloud Service Brokerage) Basic Advanced Standard • Broadband Access • Business Flow • Unified Communication • Voice • CRM, ERP, Accounting • Collaboration • Office suite & Hosted Email • HA • Cloud Storage • Websites Build • Load balance • Security & Backup • Cloud Server

19. Cloud Computing Implementation

20. Cloud Computing Concerns & Challenges

21. Clearly define project and create a project plan Define goals and objectives (decrease cost and/or increase revenue) and create a well thought-out project plan Define business and financial models; clearly understand customer requirements Take inventory and determine what needs to be on premise, what moves to cloud (private, public, or hybrid) Define services and create a roadmap with achievable milestones Recommendations in Adopting Cloud Computing in ICT If you’re brand new to Cloud, what projects can be deployed in Cloud first • Brand new apps/services that require development/deployment from scratch • Use Cloud for bursting needs. This is good for seasonal business • Try Cloud for non mission-critical apps/services or short term projects such as Test & Development • Leverage public Cloud for apps that require large compute power Identify solution and service gaps and work with partners • Work with ISVs for solution and service gaps • Whenever possible, choose vendor who support open standards • Work with expertise in Cloud Computing and Telecom for Cloud projects in ICT • Work with vendors who have experience in working with clients in green field markets

22. Transformation Opportunities • Consolidate various data centers • Achieve operational excellence • Innovate business model - Cloud Service Broker • Develop partner ecosystem to expand service portfolio Big Tier Operator • Decrease operational cost via Cloud technologies • Enhance business agility • Incorporate SaaS services via service catalog Small - Medium Operator • Transform IT to ICT • Explore private cloud for internal apps • Explore public cloud for non-mission critical projects/peak workload Large Enterprise • Leverage public cloud services for business expansion SME

23. Overview of Huawei Telco Cloud Solution Private Cloud Public Cloud Transition & Transformation ITO/BPO SaaS Telco Industry IaaS Government PaaS IT Service Mgt. Cloud Service Brokerage Platform Business Consulting Cloud OS System/Data Migration App & IT Infrastructure Mgt. Server Storage Network Data Center Consolidation Facility Mgt. Facilities

24. Huawei E2E Security Design Law SOX, SAS 70, PCI, HIPAA Data isolation, Data access control, Data backup Physical Infrastructure VM isolation, Security zones, VM Antivirus, Virtual FW Network Management Multi factor access, Log, Alarm, Virtualization Data Firewall, IDS/IPS, Anti-DDOS, Network isolation, secure transport Virtualization Management Network Redundancy, OS/DB/WebHarden, Patch, Antivirus Infrastructure Physical Monitoring, Access control, Facility failure prevention,

25. Huawei Achievements in ICT • 210 datacenter deployed globally, including 20 cloud IDC. • 30+ global leading IDC integration partners, 300+ ISV partners • Serving 1sttier telecom customers: China Mobile, China Telecom, Vodafone, STC etc. • Huawei Server achieved 4 records : SPECint－speed、SPECfp－speed、SPECint－rate、SPECfp－ratein May, 2011 • Huawei Storage Serving over 1000 key customers in 40 countries worldwide,

26. Huawei Market Highlights Building world’s largest commercial desktop cloud: 45,000 users (2012increase to 70K) CAGR of 100% for Server and 59% for storage products Built 210 DCs worldwide, 20 are based on cloud Join CERN openlab as a contributing member in Cloud Storage Launched education cloud in Guangzhou Education City China’s first health cloud: Shanghai Zhabei District Health Bureau

27. Summary With Mobile, Web 2.0, Global Comm./Collaboration, Big Data trends, Business Needs ICT to Stay Competitive • Carriers • Enterprises • Industries Cloud Computing Enables ICT • Reduce operational costs, increased IT agility, CapEx to OpEx • Innovative Cloud technologies enable new business model and generate new revenue opportunities Huawei Is Your Trusted Partner • Solid telecom background • Innovations in Cloud Computing • End-to-end Cloud enabled products and services • Proven Cloud deployments in ICT

29. Huawei Cloud IT Architecture Cloud Services (SDP, VAS, BOSS, SaaS, APIs for more SaaS Integration) Unified Management Resource scheduling Automatic resource scheduling, orchestration, mgt 7x24 Supporting Services Consulting Services for Planning & Implementations Cloud IT Infrastructure Virtual computing resource pool Virtual network resource pool Virtual block storage resource pool Virtual resources Virtual object-based storage resource pool VM and virtual storage engine Storage Security Network Computing Hardware resources S6800E E8080E RH2285 S93 Cloud storage X6000 SIG98 S56 VIS6000 Green equipment room infrastructure

30. Huawei Server Portfolio IOthroughput increased by 50% IOPS 260K • Deployment time reduced by 60% • Save5880kw/rack/year • 160 CPU/1280cores，15Tmemory Virtualization Network Interface Card Solid State Disk RH1285,2285 1U/2U Rack Server X8000 Rack Server RH5485 4 way Rack Server • SPECNo.1 in computing (SPEC CPU2006) • SPECNo.1in power efficiency (Power_ssj2008) X6000 Rack Server E6000 Blade Server

31. VIS6000 Virtual Intelligent Storage Huawei Storage Product Portfolio Cloud Application CSS CSE DCS CSA Cloud Storage Access Cloud Storage System Cloud Storage Engine DataCenter Storage • Online storage backup • Comprehensive user management • Automatic deployment and upgrades • Distributed file system • Dedicated database interface • Automated resource dispatch and management • 40-feet container data center • Green, energy-saving, and easy-to-move • 12Disks • 2Disks Application Storage HDP3500E VTL3500 VTL6000 Virtual Tape library Virtual Tape library HuaweiData Protection • Advanced architecture • Virtualization • Data protection • Integrated design • Simplified management and maintenance • Backup integration • Coupled with Netbackup • Automatic deployment • Cluster architecture, • High scalability Network Storage NAS S5000/6800E S3900/5900/6900 S8000 N8000 S2000 S12000 2U 96 Disks 2～16 Nodes ~ 15360 Disks 2 Controllers 288~ 1440 Disks 2 Controllers 120~ 1080 Disks 2-8 Controllers ~ 2400 Disks 2-8 Controllers ~ 2760 Disks SW Snap Shot Mirror LUNReplication Storage management LUN cloning

32. Huawei Cloud OS Platform Service Management Monitoring /Logs OSS/Monitoring Security Backup / HA Usage Accounting Billing Carrier Billing Others Interfaces/APIs Hypervisor Adapter Portal Cloud Orchestrator Hardware Management Amazon EC2/S3 Resource Pool VM Mgmt Automate Engine Huawei UVP Self Service Portal Server Storage Vmware Admin Portal XEN Network Security

33. Customer Example:China Telecom’s World Class Cloud Storage Service Platform Customer Challenge • Need a huge storage pool to support unpredictable subscriber customer grow • A single storage platform to support not only storage hosting service but traditional service such as IPTV, Email etc. HuaweiCloudStor Solution • 100 PBs level Storage architecture. Multiple interface supported e.g. NFS/CIFS, http. • E2E Storage Hosting Solution • Business Consulting Service Customer Benefit • Huge extension capacity, deliver 6PB usable capacity in a single platform in 1st phase, and plan to extend to 20PB in 2nd phase • Cross-domain data storage. More efficiency and lower TCO • Varied interface for multi-service bearing

34. Customer Example:UK Datastore 365 Cloud Backup Storage System Customer Challenge • The service feature of the cloud backup is reading and writing a mass of small files which requires very high performance. • The cloud backup service requires 7X24 hours running. Any interruptions will cause the lost of the online backup data. Huawei Solution • The cloud backup data are all stored in the N8000. • Implement the disaster tolerance between two sets of N8000. • Integrated with Asigra software Customer Benefit • Process 100 millions of small files • Highly-resilient, flexible storage, remote replication for data protection • Centralized data storage reduces the costs of management and maintenance.

35. Customer Example:SINOTRANS: Simplify IT with Server Consolidation Challenges • Low resource utilization due to silo system (<20%) • No enough budget to support new business, more than 50% IT expense is used for maintenance • Low reliability of service systems • Long service rollout period (months) SINOTRANS Solutions • Migrate 48 services to the cloud platform, running on 200 servers • Deploy 5000 virtual desktops with UC system to replace unreliable PC • Enhance the reliability by cloud based disaster recovery and data backup system China Mobile Huawei Benefits Huawei partner with China Mobile to provide the one-stop ICT service to SINOTRANS, let SINOTRANS to focus on the core business. • Resource utilization increased from 20% to 70%. • The rollout period is shortened from several months to three weeks. • The reliability of service system increased to 99.99%.

36. Customer Example:African Union: Secure Meeting System with VDI Challenges • Information security for PC • PC maintenance • No mobile office solution • PC noise pollution Huawei Solution • Provide VDI for 18th summit and internal training at first stage • Expand to meet bigger scale deployment in office to replace PC • AU datacenter migrate to cloud Benefits • Enhance information security, can not remove information from meeting room • Improved maintenance efficiency • Deploy meeting environment in minutes • Reduce the noise in meeting room

37. Customer Example:StarHub Expanding via Cloud Challenge & Opportunity • Traditional CT market is mature with lower growth rate. • NGBN and Gov projects drive cloud opportunity • Singapore has a large scale enterprise base for global trade • Target enterprise services as new growth point Opportunity of entering enterprise market with cloud Huawei Solution Building IaaS platform Build cost effective IaaS platform offering cloud servers and cloud storage. Provide business plan for market analysis to improve services capacity for carrier. Innovating with SaaS Establish SaaS service broker platform. Bring CP/SP, ISVs together offering SaaS services. Provide ICT one-stop solution for SME. Leverage CT technology and experience. Provide IT outsourcing service for enterprise Customer Value • Integrate various XaaS services for carrier. • Help carrier to provide cloud services for SME.

38. Customer Example:China Fujian: e-Government Brings Great Efficiency Declaration Challenges Bidding websites Government websites Credentials Tax Info platform Major hotline • IT investment with CAGR of 12% but with low utilization: 30+ data centers in different departments • Government needs cloud computing to accelerate “Digital Fujian” strategy Supervision Enterprise services Government services eGovernment Cloud Storage pool Server pool Solutions • Unified management for cloud & non-cloud • Compatible with different vendors’ server • Migrate existing 150 applications to cloud Resource pool Security pool Benefits • 50 (hundreds in future) departments share 1 cloud DC, reduce IT cost by 30% • Shared information improves public services: 1217 DBs consolidated into 1 • Green: reduce power consumption by 50%