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Digital Convergence. The challenge and opportunity of operators in face of the convergence era. 10/23/2008. The Agenda. The Trends in Communications Industry Trends 1 : Revolutionary Changes of Telecom Industry Trends 2 : From Analog to Digital World
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Digital Convergence The challenge and opportunity of operators in face of the convergence era 10/23/2008
The Agenda The Trends in Communications Industry Trends 1 : Revolutionary Changes of Telecom Industry Trends 2 : From Analog to Digital World Trends 3 : Value Chain Disruption Caused by Internet World Digital Convergence Types of Digital Convergence Network Convergence Service Convergence The Threats and Opportunities Conclusions
Trends 1:Revolutionary Changes of Telecom Industry • Telecoms networks are getting faster, bandwidth is no longer an issue • Telecoms network convergence is inevitable • Main factor of Network Convergence is not about networks or technology, the battleground is now on contents and services • Robust and open global standards are essential to the long term success of the NGN (Next Generation Network) • The “legacy” without “convergency” Telecom operators might eventually be treated as the bandwidth providers.
Driving Forces of Revolutionary Changes-Internet & Wireless • Fixed linetraffic is reducing dramatically for “traditional” services • Mobile traffic is increasing steadily even though penetration is already high. • Broadband Internet deployment shows a rapid growth trend. Fixed Mobile Broadband
Trends 2:From Analog to Digital World Analog World – silo value-chains TV Video Music Telephony Mobile Pictures Game VHS, Beta Format PSTN Format NTSC, PAL Format Cassette, Tape, Record Format AMPS Format Film, Negative Format Cassette, Tape Format Cable Cable Phone line Wireless Wire
Analog v.s. Digital Digital World – a Converged Ecosystem TV Video Music Telephony Mobile Pictures Game MP4, 3GP, H.263, H.264 Format IPTV, DVB Format MP3, AAC, WMA Format VoIP Format GSM/GPRS, WCDMA, CDMA2000, WiMAX Format JPG, GIF, BMP, Format Java, Flash, Brew Format Cable TV Broadband (ADSL, Cable Modem) Wireless (3G, WiFi, WiMAX)
Trends 3: Value Chain Disruption Caused by Internet World Communication & Collaboration Service Information Service(Search, Push,…) User / Enterprise / … User / Enterprise / … Media & Entertainment Service E-Commerce(B2B,B2C,C2C and Payment) Advertising/Marketing and Customer Service Social Network and Virtual Community Service Common Infrastructure Service (IDC,CA,DNS…) Internet Service Environment Telecom Industry Media Industry Retail/Bank/XXX Industry
Skype:Redefine “Customer’s Communication Environment” Home Enterprise Mobile Skype Network Skype VoIP
Content User User Content Content User User User User User User User User User User User User Google :Advertising-Supported Service Network Advertising Network User Network & Content Network +Go Mobile +Communication Search Mobile Network & Terminal AdSense AdWords AdWords AdSense AdSense
Artist/CP Consumer/CP Professional CP … Car iPod iTunes/Music Audio Books Apple:Redefine “Customer’s Media & Entertainment Environment” Consumer Electronics iPhone Home Office Ecosystem New Business Film/TV/Podcast Content Network Ecosystem New Business
The threetrendsare pushing for… • Digital Convergencethe integration of mobile and fixed technologies to enable the seamless distribution of services over fixed/mobile/internet/cable networks
Types of Convergence future convergence current convergence
NetworkConvergence Before “Stovepipe” service model After“simplified” service model Services Content and Services Services Services Services Servers ... PSTN / ISDN Data / IP IMS Core CATV PLMN MGWs Access Access Access Broadcast UMTS PSTN / ISDN GSM/EDGE xDSL WiFi/WiMax
IMS IMS ; IP Multimedia System IMS is a global standards for converging networks Fixed Broadband Wireless Access Cable Mobile
Service convergence Broadcast type • IPTV • Pay TV • Hi-Fi Radio • Electronic Programme Guide (EPG) • Multicast Streaming • Live Streaming for VOD • Progressive Downloads(Video, gaming, music, file downloads) • On Demand type • Interactive VOD • Scheduled Play-out( n-VOD) • Scheduled Capture ( n-PVR) • Client side Personal Video Recording • Pay per View(PPV) • Games on Demand • Time Shifted TV • Others ( Music Download,Music of Demand,Karaoke on Demand,TV based internet access, caller ID pop up) • Interactive type • Interactive TV • Video Conferencing • Interactive Online Network Gaming • Interactive E-Learning • Interactive E-Shopping • Tele-Medicine • Internet and Voice types • VoIP • Browsing on TV • E-mail/SMS/MMS from TV • Caller ID Popup
Service Bundling vs. Service Blending • Legacy networks utilize “Service Bundling” technics for marketing/sales purpose • Converged networks deliver “Blending Services” (by nature) to achieve marketing/sales purpose.
Threat and Challenge on Communications Industry Ebay/Paypal Communications Industry Supply Chain Business Model OPEX Marketing Service Payment Service CRM Service Network Connectivity Voice/Messaging Media & Entertainment End User and User Equipment Skype Apple WiFi Mesh/ WiMax MySpace/QQ
New Opportunities for Communications Industry Digital Media & Entertainment and Online/Mobile Advertising Integrated Internet Service bundle for Mobile Users (Mobile PC/Internet) Enterprise Application Hosting Service for SME and … Mobile Payment and Online Shop(B2C/C2C) • Internet Industry • Media & Entertainment Industry 2 1 • Communications Industry 4 3 • Bank/Finance Industry • IT Industry 1 2 3 4
EA • Take 2 Interactive • Apple • Cisco • Lucent • Motorola • Nokia • MVNO • AOL • TWC/Cable • XM Radio Digital Convergence in Action … Technology Media • HP • Agilent • Sun • IBM • Portals/Google • IPG • Sony • Disney/ESPN • Time Warner • Stations Telecom • Earthlink • AT&T • Sprint Nextel • Verizon
Conclusions • The principle factors that are driving “Convergence” of Media, Communication, and Computing (IT) industries are: • The digitalization of data, • The growth in broadband connectivity (wireline and wireless), and • The continuous advances in technology • Digitalization provides a common base for handling different types of information (numbers, words, voice, music, pictures, game, video…) using the same devices, processing technique, and media. • Future is converging – all things are digitalized, wired (free), and application-purposed (content) • Media - TV, music, movie, books, video, game… • Communication – IP for wireline / cable and wireless • Computing – IT, all devices are computers