1. 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 (http://seebb2006.tninternational.com/ ) 10-11 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 Jaroslaw.Ponder@itu.intJaroslaw.Ponder@itu.int

2. 10 April 2006Jaroslaw.Ponder@itu.int2Agenda 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

3. 10 April 2006Jaroslaw.Ponder@itu.int3 Concept of IP-enabled NGNs and next generation access networks We all build the Information Society together!

4. 10 April 2006Jaroslaw.Ponder@itu.int4 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

5. 10 April 2006Jaroslaw.Ponder@itu.int5 NGN: New environment Access IP-based Networks Applications Source : Telefonica 2005

6. 10 April 2006Jaroslaw.Ponder@itu.int6 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

7. 10 April 2006Jaroslaw.Ponder@itu.int7 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

8. 10 April 2006Jaroslaw.Ponder@itu.int8 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

9. 10 April 2006Jaroslaw.Ponder@itu.int9 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. 10 April 2006Jaroslaw.Ponder@itu.int10 Service Driven Next Generation Access Networks Upstream / (Mb/s) Downstream / (Mb/s) Video preview Advanced videophony 100 0.06 0.2 0.6 2 0.060.621035 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

11. 10 April 2006Jaroslaw.Ponder@itu.int11 Upstream / (Mb/s) Downstream / (Mb/s) Mobile Broadband ADSL ADSL 2+ 100 0.06 0.2 0.6 2 0.060.621035 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

12. 10 April 2006Jaroslaw.Ponder@itu.int12 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

13. 10 April 2006Jaroslaw.Ponder@itu.int13 Worldwide and regional trends We all build the Information Society together!

14. 10 April 2006Jaroslaw.Ponder@itu.int14 Broadband access worldwide (2005) DSL and Cable prevail over other technologies worldwide

15. 10 April 2006Jaroslaw.Ponder@itu.int15 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

16. 10 April 2006Jaroslaw.Ponder@itu.int16 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%

17. 10 April 2006Jaroslaw.Ponder@itu.int17 Broadband subscription price, (cheapest plan sampled, monthly, US$, top 75, 2005)

18. 10 April 2006Jaroslaw.Ponder@itu.int18 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

19. 10 April 2006Jaroslaw.Ponder@itu.int19 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

20. 10 April 2006Jaroslaw.Ponder@itu.int20 Measuring Opportunities Digital Opportunity Index 1/3 DOI Opportunity Utilization Infrastructure

21. 10 April 2006Jaroslaw.Ponder@itu.int21 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

22. 10 April 2006Jaroslaw.Ponder@itu.int22 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

23. 10 April 2006Jaroslaw.Ponder@itu.int23 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 Estonia0.940.590.190.58 Slovenia0.970.480.170.54 Czech Rep.0.930.420.230.53 Malta0.940.330.270.51 Cyprus0.970.430.120.51 Croatia0.920.520.10.51 Slovak Rep.0.940.420.140.5 Greece0.930.430.060.47 Hungary0.920.40.10.47 Latvia0.880.370.120.46 Poland0.940.360.080.46 Lithuania0.930.340.090.46 Turkey0.890.380.050.44 Bulgaria0.720.310.090.38 Bosnia0.860.20.020.36 Serbia and Montenegro0.740.240.040.34 Rumania0.560.240.070.29 Macedonia0.640.190.030.29 Albania0.580.10.010.23 Note 2: Calculated on base of 2004 data

24. 10 April 2006Jaroslaw.Ponder@itu.int24 DOI in selected SEE Countries Note: Calculated on base of 2004 data

25. 10 April 2006Jaroslaw.Ponder@itu.int25 DOI in selected SEE Countries Note: Calculated on base of 2004 data

26. 10 April 2006Jaroslaw.Ponder@itu.int26 Challenges for SEE countries We all build the Information Society together!

27. 10 April 2006Jaroslaw.Ponder@itu.int27 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

28. 10 April 2006Jaroslaw.Ponder@itu.int28 Thank you very much for your attention! Jaroslaw K. Ponder International Telecommunication Union Strategy and Policy Unit E-mail: Jaroslaw.Ponder@itu.intJaroslaw.Ponder@itu.int http://www.itu.int/spu Tel: 00 41 22 730 60 65 Fax: 00 41 22 730 64 53 We are building global information society together!

29. 10 April 2006Jaroslaw.Ponder@itu.int29Resources Full version of this presentation and others focusing on NGN: www.itu.int/osg/spu/presentations/ www.itu.int/osg/spu/presentations/ NGN regulatory and policy resources: http://www.itu.int/osg/spu/ngn/ ngn-policy-regulatory-resources.html http://www.itu.int/osg/spu/ngn/ ngn-policy-regulatory-resources.html ITU activities on NGN: www.itu.int/spu/ngn www.itu.int/spu/ngn

30. 10 April 2006Jaroslaw.Ponder@itu.int30 International Telecommunication Union We all build the Information Society together!

31. 10 April 2006Jaroslaw.Ponder@itu.int31 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

32. 10 April 2006Jaroslaw.Ponder@itu.int32 ITU – International Telecommunication Union

33. 10 April 2006Jaroslaw.Ponder@itu.int33 ITU’s Strategy and Policy Unit (SPU) http://www.itu.int/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…