Transcript Company Highlights

The Business Case
of Broadband Wireless Access
February 2001
Rudy Leser
Vice President Business Development
e- mail: [email protected]
1
Early 2001 – New Environment
 Equity market - on hold
 Vendor financing – very selective
 Slow-down in the Telecom market
 Growth of broadband – slower than expected
 BWA CLECs business case – yet to be proven
2
Strategic Focus is Shifting
 Cash-flow
 Better cost model
 Slower broadband growth
 Differentiation
3
Trends In The Telecom Market
Some CLECs’s
business plans
are faulty
4
Financing
squeeze
Review plans
to improve ROI
The strong ones
will survive
Business Plan is Revisited
 Capture quality customer base quickly
 Generate revenues
 Reach profitability faster
5
BWA New Strategies –
From Survival to Success
 Focus on high density areas
 Re-assess marketing strategy:
 Leave behind buzzwords and hype
 Strong focus on specific segments
 Find stronger differentiating factors
 Offer your segment what is really needed
 Reduce initial investment and expand as you grow
(Not a Slogan!!!)
6
Focus on Your Segment
 SME
 Small business/soho
 MTU
 Residential
7
Carriers’ Criteria for Choosing
BWA Equipment
1
2
3
4
Maximize capacity of main asset:
limited spectrum
Minimize initial infrastructure investment
Differentiated services – competitive
advantages over incumbent
Support for licensed spectrum band
8
BWA Differentiated Services
Prioritized
VLANs
VLANs, VPNs
Switched circuit voice
on demand
9
WALKair Meets Carriers’ Needs
1
2
Modular base station – low initial cost
3
4
10
Largest coverage capacity in the market
Enables flexible bandwidth per customer
and differentiated services (QoS, SLA)
Supports all licensed bands
(3.5, 10.5, 26 GHz)
Commerical Deployments
Europe:
Cameron - Sakon
Czech Rep. – CRA, GlobalOne
Finland - Finnet
Germany - Arctel, FirstMark, Star 21
Luxembourg - FirstMark.
Norway - UPC
Poland – El Net, TPSA, TPZ, Czeptel,
Elterix.
Portugal – Teleweb, Novis
Russia - Sovintel
Slovenia – Telekom Slovenia
Spain – Abrared, FirstMark
Norway
Finland
Russia
Germany
Poland
Luxembourg
Czech Rep.
Slovenia
Portugal
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Spain
Commerical Deployments, CONT’D
Asia
Africa
China
India – Gateway, STPI
Philippines - Beltel, Digitel
Cameron – Sakon
Gahna - SITA
Nigeria - SITA
Zimbabwe - Africom
China
Mexico
Honduras
Nigeria
Cameron
Latin America
Argentina - Telefonica
Honduras - GlobalOne
Mexico – G-Tel
Uruguay – Rivizul
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India
Gahana
Uruguay
Zimbabwe
Argentina
Philippines
The BWA Experience
 Germany – major allocation in Q3/1999
 Hundreds of Base Stations
 Very few end-user connected
 Spain – allocation in Q1/ 2000
 Hundreds of Base Stations
 Very few end-user connected
 Portugal – Allocation in Q4/1999
 Tens of Base Station
 Just started to connect customers
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The CLEC Access Cost Model
Per CPE link
€ 140
&
Feeder Costs
& access cost
€ 120
/
Infrastructure Opex
BS/CO
&
. & comm.
CPE Installation
Euro per month
€ 100
&
.& comm.
BS Installation
€ 80
Maintenance
BS/CO CAPEX
€ 60
CPE CAPEX
€ 40
€ 20
Note:
€0
BWA
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xDSL
I. Monthly cost
II. full capacity analysis
BWA Versus xDSL/ Unbundled Access
Various cost comparisons show that BWA may
cost from 5% to 25% higher than xDSL using
unbundled access.
15
CLEC: xDSL/Unbundling
Advantages
 Quick penetration with minimal investment
 Lower cost mainly for basic services at high
penetration
16
CLEC: xDSL/Unbundling
Disadvantages
 Incumbent is owner of the infrastructure
No control of line quality , response time,
maintenance, competition ...
 Poor quality
when binder fill more than 20% ...
 Limited service capacity
only up to E1, no symmetric traffic ...
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Conclusion:
Unbundled xDSL for CLEC
 Limited penetration – wire lengthe & quality
 Very limited Service capabilities– BW &
flexibility
 Quality of Service is not guaranteed
 Infrastructure owned by incumbent
WALKair provides a carrier class , competitive
solution, which is independent from the
incumbent
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CLEC – Differentiation by BWA
 Bandwidth higher than the incumbent's
DSL
 > 2 Mbit/sec symmetrical
 Dynamic bandwidth per user allow offering
peak rate based services, yet with
committed minimal throughput.
 E.g. committed 512 Kbit/sec and a
maximum of 4 Mbit/sec
 Combine with BR-ISDN
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Broadband Access:
New Business Model
Winners: BWA by new carrier, xDSL by ILEC, Cable provider
Losers: xDSL by new carrier, Fiber by new carrier & ILEC
5 yrs cash flow ( in millions US$ )
20
0
-20
New carrier xDSL
Source: Ovum, September 2000
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Wireless
Floware WALKair
 Market leadership
 Differentiated and advanced carrier-class services
for SME & MDU
 Powerful IP support
 Extensive voice support
 Highest cell capacity
 Best product portfolio for all business market
segments
 Multi frequency bands: 3.5, 10.5 and 26 GHz
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Summary – The Business Case for
BWA
BWA is the CLEC’s most suitable technology
to access its business customers
1
2
3
4
BWA enables Differentiated services –
competitive advantages over incumbent
With BWA the CLEC can Minimize initial
infrastructure investment
BWA offers the CLEC a competitive cost
structure
22
“Broadbanding the last mile”
Thank You
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