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Who wants to be an IP Telephony millionaire ? (2002)

"Who wants to be an IP Telephony millionaire ?" presented at VON Europe in Helsinki, June 2002

mjadoul
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Who wants to be an IP Telephony millionaire ? (2002)

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  1. Marc Jadoul VoN Europe — Helsinki, 12 June 2002 VON Europe 2002 - M. Jadoul - 1 All rights reserved © 2002, Alcatel.

  2. 50:50 In 1965, an Intel co-founder made a prediction about transistor density on microprocessors, that is often being used as the basis for forecasting technology evolution. How is this prediction commonly known ? • A: Moore’s Law • B: Newton’s Law • C: Murphy’s Law • D: Pulver’s Law VON Europe 2002 - M. Jadoul - 2 All rights reserved © 2002, Alcatel.

  3. 50:50 In 1965, an Intel co-founder made a prediction about transistor density on microprocessors, that is often being used as the basis for forecasting technology evolution. How is this prediction commonly known ? • A: Moore’s Law • A: Moore’s Law • A: Moore’s Law • A: Moore’s Law • B: Newton’s Law • C: Murphy’s Law • D: Pulver’s Law VON Europe 2002 - M. Jadoul - 3 All rights reserved © 2002, Alcatel.

  4. 50:50 Some years later, Ethernet pioneer and 3Com co-founder Bob Metcalfe also made an observation, known as Metcalfe’s Law. What is Metcalfe’s Law about ? • A: Packet loss • B: Voice quality • C: Medium access • D: Network value VON Europe 2002 - M. Jadoul - 4 All rights reserved © 2002, Alcatel.

  5. 50:50 Some years later, Ethernet pioneer and 3Com co-founder Bob Metcalfe also made an observation, known as Metcalfe’s Law. What is Metcalfe’s Law about ? • A: Packet loss • B: Voice quality • C: Medium access • D: Network value • D: Network Value • D: Network Value • D: Network Value VON Europe 2002 - M. Jadoul - 5 All rights reserved © 2002, Alcatel.

  6. Are you a ??? VON Europe 2002 - M. Jadoul - 6 All rights reserved © 2002, Alcatel.

  7. IP Telephony: IP Telephony: turning Technology into Value turning Technology into Value Marc Jadoul Marc Jadoul VoN VoN Europe Europe — — Helsinki, 12 June 2002 Helsinki, 12 June 2002 VON Europe 2002 - M. Jadoul - 7 All rights reserved © 2002, Alcatel.

  8. Moore’s Law Moore’s Law Transistor density on microprocessors doubles each 18 months. (Technology evolves at a predictable pace…) Gordon Moore technology technology evolution evolution density density time time VON Europe 2002 - M. Jadoul - 8 All rights reserved © 2002, Alcatel.

  9. Metcalfe’s Law Metcalfe’s Law The value of a network rises exponentially (N2) with the number of network nodes, while the cost follows a more or less linear function. € € value value Bob Metcalfe cost cost # # network network nodes (N) nodes (N) 0 0 1 1 2 2 3 3 4 4 5 5 VON Europe 2002 - M. Jadoul - 9 All rights reserved © 2002, Alcatel.

  10. Moore’s Law and IP Telephony Moore’s Law and IP Telephony Gateway density and voice quality Gateway density and voice quality Ten thousands of ports per GW rack Encoding, silence suppression, comfort noise, echo cancellation, jitter buffer size, etc. Maturing softswitches and GW control protocols Maturing softswitches and GW control protocols Millions of BHCA handled by one softswitch Megaco/H.248 and MGCP are up and running Class 4, Class 5 and “rich voice” features SIP is the SIP is the signalling H.323 is still kicking SS7 a prerequisite for “carrier” voice signalling protocol of choice protocol of choice ATM, MPLS and ATM, MPLS and Diffserv Guaranteed QoS with acceptable roundtrip delays Diffserv VON Europe 2002 - M. Jadoul - 10 All rights reserved © 2002, Alcatel.

  11. Metcalfe’s Law and IP Telephony Metcalfe’s Law and IP Telephony Plain vanilla voice is not enough Plain vanilla voice is not enough There’s more than arbitrage Voice services competing with… voice services What happened to the C2D, ICW and UMS promises ? “Nice to have” is not always “need to have” Broadband access customer base is too narrow Broadband access customer base is too narrow PC is not the right voice terminal IP phones are scarce and expensive Windows XP Messenger the catalyst for SIP ? The dot.com hype is over The dot.com hype is over Competitive providers getting out of business Incumbents still in “wait and see” mode Legacy is here to stay (and interoperability is a must) VON Europe 2002 - M. Jadoul - 11 All rights reserved © 2002, Alcatel.

  12. Technology Adoption Cycle Technology Adoption Cycle “Stick with the herd!” “Get ahead of the herd!” “Hold on!” Pragmatists Conservatives “Try it!” “No way!” Visionaries Skeptics Techies Early Early Adopters Adopters Early Early Majority Majority Late Late Majority Majority Innovators Innovators Laggards Laggards Source: the Chasm Group, 2001 VON Europe 2002 - M. Jadoul - 12 All rights reserved © 2002, Alcatel.

  13. Introducing the “Chasm” Introducing the “Chasm” The greatest peril in in developing high The greatest peril in in developing high- -tech markets is making the transition from an early markets is making the transition from an early market to a mainstream market market to a mainstream market tech Pragmatists Conservatives CHASM CHASM Visionaries Skeptics Techies Mainstream Market Mainstream Market Early Market Early Market Source: the Chasm Group, 2001 VON Europe 2002 - M. Jadoul - 13 All rights reserved © 2002, Alcatel.

  14. IP Telephony trapped in the Chasm ? IP Telephony trapped in the Chasm ? ? IP Telephony is in the middle of the IP Telephony is in the middle of the transition from a technology driven business transition from a technology driven business to a value driven business to a value driven business ? Metcalfe’s curve Metcalfe’s curve Moore’s curve Moore’s curve Value driven Value driven Technology driven Technology driven VON Europe 2002 - M. Jadoul - 14 All rights reserved © 2002, Alcatel.

  15. Only the Winners will be able Only the Winners will be able to Cross the IP Telephony Chasm to Cross the IP Telephony Chasm Good value proposition for End Good value proposition for End- -users Go for the “purple minutes” “Sticky” services (need to have) “Full service” packs (e.g. bundling with xDSL) “No risk” service providers users Revenue generating solutions for Carriers Revenue generating solutions for Carriers “From CPE to CO” (end-to-end offering) Service creation, management and charging capabilities Scalability, “five nines”, flexibility, interoperability Local market presence and professional services … Marketing, Marketing, Marketing ! … Marketing, Marketing, Marketing ! VON Europe 2002 - M. Jadoul - 15 All rights reserved © 2002, Alcatel.

  16. So, ... are you a ??? VON Europe 2002 - M. Jadoul - 16 All rights reserved © 2002, Alcatel.

  17. VON Europe 2002 - M. Jadoul - 17 VON Europe 2002 - M. Jadoul - 17 All rights reserved © 2002, Alcatel. All rights reserved © 2002, Alcatel.

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