Developing Next Generation Access Networks Challenges in the SEE Region Developing Next Generation Access Networks Challenges in the SEE Region Jaroslaw K. Ponder Strategy and Policy Unit International Telecommunication Union The 1 st Southeastern Europe Broadband 2006 Conference & Expo ( ) April 2006, Belgrade, Serbia and Montenegrohttp://seebb2006.tninternational.com/ Note: The views expressed in this presentation are those of the author and do not necessarily reflect the opinions of the ITU. Jaroslaw K. Ponder can be contacted at

10 April Concept of IP-enabled NGNs and next generation access networks Techno-economic analysis and implications for access networks Worldwide and regional trends Challenges for the SEE region

10 April Concept of IP-enabled NGNs and next generation access networks We all build the Information Society together!

10 April NGN versus NGAN ITU-T SG 13: Rec. Y.2001 packet-based network multiple broadbandQoS-enabled service-relatedfunctions independenttransport-related technologies  A NGN is a packet-based network able to provide telecommunication services and able to make use of multiple broadband, QoS-enabled transport technologies and in which service-related functions are independent from underlying transport-related technologies. unfettered access  It enables unfettered access for users to networks and to competing service providers and/or services of their choice. generalized mobility  It supports generalized mobility which will allow consistent and ubiquitous provision of services to users. What is different?  Multimedia  Generalized mobility  Convergence  Integrity  Multi-layer orientation  Open character

10 April NGN: New environment Access IP-based Networks Applications Source : Telefonica 2005

10 April What drives NGN development? Better financial performance  Revenue growth  Margin protection  Reduced OPEX and CAPEX Operational issues  Obsolescence & modernization  Reliability, resilience & quality  Capacity & scalability  Simpler and faster provision of service Competitive issues  New service roll-out/substitution & service differentiation  Market share growth & protection  Convergence of voice, data and IT enables provision of new offerings in packages

10 April NGN impact Convergence Market structure Market potential Business models Price strategies Sell strategies Customer preferences Customer protection Regulatory model What next… Now Service AService B Service C Net. A Net. BNet. C Future Services A, B, C IP Platform (QoS) Access Networks

10 April New requirements Up-grade of the core networks Expansion of next generation access networks Fix Mobile Convergence High investment programmes Very high investment risk  Unknown business models  Unknown regulatory proceedings  Regulatory holydays under discussion

10 April Next Generation Access Networks Fixed  xDSL  Cable TV  PLC  FTTx Wireless  Mobile infrastructures; 2G to 3G and beyond 3G  WiFi and WiMAX  Satellite  Digital broadcast infrastructures  Wireless Mesh networks

10 April Service Driven Next Generation Access Networks Upstream / (Mb/s) Downstream / (Mb/s) Video preview Advanced videophony Broadband + Multi HDTV TV VoD Interactive TV Broadband + Multi VoD HDTV Local web server teleworking Broadband Video Telephony Video Games Peer to Peer Note: Adopted from TPSA Fixed voice/ Fax / Dial-up

10 April Upstream / (Mb/s) Downstream / (Mb/s) Mobile Broadband ADSL ADSL Broadband + Multi HDTV TV / VoD Interactive TV Broadband + Multi VoD HDTV VDSL Local web server teleworking Peer to Peer FTTx Fixed BWA Note: Adopted from TPSA Service Driven Next Generation Access Networks

10 April Life of Next Generation Access Technologies WiMax FTTh VDSL2 VDSL ADSL2+ WiMAX ADSL2 ADSL GPRS GSM UMTS WiFi EDGE Life cycle of next generation access technologies is relative and depend on the regional or country particularities Emerging Growing MaturedDeclining time

10 April Worldwide and regional trends We all build the Information Society together!

10 April Broadband access worldwide (2005) DSL and Cable prevail over other technologies worldwide

10 April FTTx in Europe (2005) Source: IDATE (2005) European FTTx subscribers Home / Building passed Source: IDATE (2005) Few countries started development of FTTx infrastructure. The customer base is still very small but grows very fast in most of leading economies

10 April Broadband access in SEE (2005) 0.0%0.1%0.2%0.3%0.4%0.5%0.6%0.7%0.8% Serbia & Montenegro - Montenegro Serbia & Montenegro - Serbia Bulgaria Serbia & Montenegro - Kosovo The former Yugoslav Republic of Macedonia Bosnia & Herzegovina Romania Croatia Turkey DSL Cable modem Other 0.68% 0.60% 0.41% 0.12% 0.11% 0.08% 0.02% 0.0% Broadband penetration by technology in SEE, 2005 Broadband penetration rates of SEE leading countries do not exceed 1%

10 April Broadband subscription price, (cheapest plan sampled, monthly, US$, top 75, 2005)

10 April Broadband prices per 100 kbit/s (top 75, 2005) The broadband prices for in selected SEE countries are very high and very high and not affordable for average user

10 April Wireless technologies In 2004 in Romania 279’408 users of 3G, 2.7% of all mobile subscribers (16 position) In 2004 Moldova 3’000 users of 3G, 0.4% of all mobile subscribers (32 position) 3G Number of cellular users per 100 inhabitants

10 April Measuring Opportunities Digital Opportunity Index 1/3 DOI Opportunity Utilization Infrastructure

10 April Digital Opportunity Index DOI percentage of population covered by mobile cellular telephony internet users per 100 inhabitants Proportion of households with fixed line telephone mobile cellular tariffs as a percentage of per capita income internet access tariffs as a percentage of per capita income ratio of broadband internet subscribers to internet subscribers ratio of broadband mobile subscribers to mobile internet subscribers mobile cellular subscribers per 100 inhabitants proportion of households with Internet access at home mobile internet subscribers per 100 inhabitants proportion of households with a computer Opportunity Utilization Infrastructure Infrastructure

10 April Digital Opportunity Index in developed economies and CEE DOI  Leaders: Korea, Hong Kong and Japan  CEE: High opportunities but low utilization Mobile component and broadband

10 April Digital Opportunity Index in South Eastern Europe DOI in SEE  Leaders: Croatia, Turkey, Bulgaria  Special Cases: Romania, Macedonia, Albania  CEE: High opportunities but low utilization  SEE: Low opportunities High opportunities but low utilization Note 1: DOI results calculated on different dataset as results presented on the previous slide OpportunityInfrastructureUtilizationDOI Estonia Slovenia Czech Rep Malta Cyprus Croatia Slovak Rep Greece Hungary Latvia Poland Lithuania Turkey Bulgaria Bosnia Serbia and Montenegro Rumania Macedonia Albania Note 2: Calculated on base of 2004 data

10 April DOI in selected SEE Countries Note: Calculated on base of 2004 data

10 April DOI in selected SEE Countries Note: Calculated on base of 2004 data

10 April Challenges for SEE countries We all build the Information Society together!

10 April Challenges for SEE Countries Definition of long term goals of the regulatory policy; privatization process Regulatory reform and harmonization Promotion of pro-competitive policy and focus on dynamic aspects Balance between service based and infrastructure based competition Efficient and workable unbundling policy Optimal spectrum management New approaches relevant for IP- enabled NGNs

10 April Thank you very much for your attention! Jaroslaw K. Ponder International Telecommunication Union Strategy and Policy Unit Tel: Fax: We are building global information society together!

10 April Full version of this presentation and others focusing on NGN: NGN regulatory and policy resources: ngn-policy-regulatory-resources.html ngn-policy-regulatory-resources.html ITU activities on NGN:

10 April International Telecommunication Union We all build the Information Society together!

10 April ITU - International Telecommunication Union The oldest specialized UN agency with more than 140 years of experience in communication sector Headquarters in Geneva plus regional offices ITU staff: more than 750 from more than 80 countries 189 member states, more than 640 sector members ITU Agenda for Change Structure of the ITU  ITU-T – Telecom Standardization  ITU-R – Radio-communications  ITU-D – Development Bureau

10 April ITU – International Telecommunication Union

10 April ITU’s Strategy and Policy Unit (SPU) New Initiatives Programme  Digital Bridges (2005)  Ubiquitous Network Societies (2005)  Today’s Networks Tomorrow (2005)  What Rules for IP-enabled NGNs? (2006)  Digital Transformations in the Information Society (2006)  Regulatory Environment for Future Mobile Multimedia Services (2006) Many other activities…