Open Source, Business Models, and Standards…

New Era of Networking is Here! Disaggregation Softwarization & Virtualization Open Source That we as a community have been making lot of progress and we should feel very good about all the barriers we have overcome. And we can now announce that the New Era of Networking is here. It is defined by o Disaggregation o Softwarization and Virtualization o Open Source How do disaggregation, softwarization and virtualization, and open source manifest?

Vendor Business Model + Open Source Open Source ONOS, ODL, OPNFV, … Current Business Units With Closed Boxes Proprietary solutions with “Open Source Inside” Current sales force & sales channel Service Providers ASICs HW Box Embedded SW Open Source R&D Investments Metrics of success: Number of boxes sold, support contract Recipe for Failure – does not work for any disruptive innovation

Service Provider & Vendor: Difficult Equation Service providers have to transform their infrastructure & business Conceptual (not real fractions) Vendors current models don’t help service providers Capex Opex Software Services Capex Opex Software Services Service Provider Spending

What can vendors do? How can vendors make money with merchant silicon, white boxes, open source?

Explosive growth expected in new services

Who will create the services and who will capture the value? $100B+ Question Who will create the services and who will capture the value?

Vendor’s Disruptive BU Business Model Open Source Vendor’s Disruptive BU System Integration Software for new services Solutions/Services Sales Force Service Providers Merchant Silicon Own silicon if competitive White box from ODM Own box if competitive Open Source System Integration SW & Services R&D Investments ($10s of million + New Talent) Metrics of success: Software and Services Capex/Opex savings for service providers Recipe for Success – become a real partner of service providers to realize Capex & Opex savings and create new services

Open Source and Standards Open source integrated & e2e solutions require standards Open Source Standards Gaining significance but does NOT eliminate the need for standards Have problems; losing significance for some “good reasons” but we need them Challenge Two As we build open source integrated and end to end solutions with open source platforms we still require standards – some standard protocols and some standard APIs to get interoperability and avoid vendor lock-in. However we know the pitfalls of standards --- our industry knows it really well… For example Standards take too long & removed from implementation experience Companies game the standards processes to get competitive advantage and protect IPR and the end result is that many times the standards don’t guarantee interoperability All this is true but still we need standards even with open source. Our challenge is how to get the best of open source and standards and how to make them work together. How to get the best of both

Example Collaboration: SDOs and Open Source BBF Next Gen Broadband Use Cases CORD Open Reference Implementation Use Cases/Requirements MEF Next Gen Enterprise Use Cases IEEE Open Source Implementations Input to Specifications IEEE 5G Capabilities

Devil is in the Details… Intellectual Property Rights (IPR) Many companies are used to making money based on IPR royalty With open source, you give away your IPR Companies look at standards as a way to get competitive advantage With open source, you get a competitive advantage very differently What to do with the army of “standard professionals” They cannot contribute to open source and difficult for them to derive standards based on open source

The “frontier” is to invent the right business models for various stakeholders

Thank You!