Connex18 Review - frenus.com · Source: OPPORTUNITIES PRESENTED BY DIGITAL TRANSFORMATION The company plans to capitalize on the opportunities offered by digital transformation by

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Market Intelligence & Consulting

Alcatel-Lucent Enterprise Analyst Conference, 24-26 January 2018, Riga

Connex18 Review

21.02.2018 Stuttgart

Source:

ALE CONNEX18: BRIEF OVERVIEW

Connex18 focused on providing a summary of the company efforts to pursue a vertical-led, outcome-based

delivery model to address digital transformation - conference had 50 participants and was held in Riga

2FRENUS, ALE

Connex18 Quick Facts

Around

50participants

Around 20ALE executive

and expert

speakers

3 days conference held

in Riga

Participants (excerpt)

Alcatel-Lucent Enterprise

› CEO: Jack Chen

› Headquarters: Colombes (FR), Calabasas, CA (USA)

› Number of employees: around 2,200

› Presence: In 50+ countries

› Top industries: Hospitality, Healthcare, Transportation, Education and Government

“Where everything connects”

Connex18 Topics

Vertical Digital

Transformation

Hybrid Communication/ Mobility & IoT

Secured Networks

Cognitive

Communication

Networking and Communications

Breakout Sessions

Executive one-on-one

Meetings

“Building the

digital future

for everyone”

Source:

2017 SALES RESULTS

In 2017, ALE achieved an overall revenue growth of 5% with the transportation vertical reflecting a strong 3-

digit growth – EUNO and EUSO are strong markets for ALE’s networks and communication BUs respectively

3FRENUS, ALE

2017 Business Achievements and Sales Growth

Regional Results

Europe North (EUNO)

› Triple digit growth in transportation –

thanks to unique value proposition

› Regional growth fuelled by networking

division

› 10% growth in sales partners – betting on

Russia

North America (NAR)

› Transportation represents 60% of sales

› Slight decline in education

Europe South (EUSO)

› Largest share of communications business -

Brazil & Spain lead in cloud

› Strong public vertical

› Mexico switched to indirect channel partner-

led sales strategy

Asia-Pacific (APAC)

› Achieved two digit growth

› 70% of revenue driven by the five focus

verticals

› CPaaS wins large business

“Our growth is

fueled by verticals”(Matthieu Destot –

EVP Global Sales and Marketing)

Vertical Performance

3-digit growth

Transportation

1-digit growth

Education

Hospitality

2-digit growth

Healthcare

Government

Business Transformation KPIs for ‘17

Overall 5% revenue growth

More than 500 new customers

acquired

More than 235 thousand cloud

seats added

Increased the number of

partners by more than 15%

Double-digit growth in vertical

markets

Source:

TOP-LINE STRATEGY FOR 2018

ALE’s 2018 sales strategy is focused on execution of selling fully via channel partners, vertical

transformation, and sustainable growth in cloud delivery

4FRENUS, ALE

2018 Sales Strategy

Cloud Delivery GrowthChannel Sales Current Stage and Offering

Transportation EducationHospitalityHealthcare Government

EUSO

EUNO

APAC

EUNO

NAR

All

regions

EUSO

APAC

NAR

Regional focus per vertical* 2018

Sales funnel

focus

Acquisition

Activation

Retention

Revenue

Referral“We are doing a transformation to the

cloud (…) we are not a cloud-native

company. We are moving from on-premise

to cloud, from CAPEX to OPEX”(Matthieu Destot – EVP Global Sales and Marketing)

*Sales regions - EUNO: Europe North, EUSO: Europe South incl. South and Latin America, NAR: North America, APAC: Asia Pacific

**Communications Platform as a Service (CPaaS) helps integrate cloud-based

communication features like chat and voice/ video conferencing into business

applications by using custom developed Application Programing Interfaces (APIs)

Partner focus

› Recruiting vertically focused partners and cloud

service providers to further strengthen the

channel strategy

› Focusing on strong partners who are

committed and co-investing in initiatives

Focused vertical sales

› Vertical focus is differentiated per region,

according to the strong verticals (per region 2-3

focus verticals)

› Developing vertical sales teams who identify use

cases and customer pain points to drive growth

from bottom-up

› Account based marketing using social networks

Communications

› Aiming to capitalize on user acquisition and

activation phases of the sales funnel in 2018

› Attracting developers in Rainbow CPaaS** –

recent new deals in professional services

› Focus on user acquisition for Rainbow UCaaS***

Networks

› The new OmniVista Cirrus Network

Management Platform combines cloud and

networking, is a very important offering for the

business unit

› Focus on acquisition and activation phases

Readiness

› Both business units (communication and

networks) work together to align regional teams

and transform business to the cloud

› Automation of processes by end-to-end

integration offered for partners in order to

leverage the ALE Cloud

Growth Hacking

› Dedicated cloud sales team to make sure users

remain active

› Measure include social media monitoring and

metrics, analytical approach and R&D

***Unified Communications as a Service (UCaaS) is the delivery of different enterprise

collaboration and communication features like instant messaging, telephony, voice and

video calls via the cloud

Source:

OPPORTUNITIES PRESENTED BY DIGITAL TRANSFORMATION

The company plans to capitalize on the opportunities offered by digital transformation by pivoting its

traditional strengths in networks and communication to serve the five specific verticals

5FRENUS, ALE

Key Challenges:

Impact of digitized patient

files

ALE Value Proposition:

› App. Partner

Ecosystem

› Engagement services

(OpenTouch Evolution,

LBS Services)

› Mobility (Rainbow

WebRTC Gateway)

Healthcare

Key Challenges:

Secure premises , impact

of classroom digitalization

ALE Value Proposition:

› Learning Management

System integration

› Rainbow UCaaS,

Greetings IVR

(Engagement services)

› Multicast for

broadband services

Key Challenges:

Increase capacity, safety,

comfort and reduce risks

and costs

ALE Value Proposition:

› Monetization model

for APIs

› Local storage

› Extended geographical

coverage

› Multicast CCTV/TETRA

integration

Key Challenges:

Facilitate citizen

engagement

ALE Value Proposition:

› Local storage

› App. Partner

Ecosystem

› Rainbow UCaaS

› Software based

encryption

› Multicast for CCTV

Key Challenges:

Increase revenue/available

room & differentiate from

disruptive competitors

ALE Value Proposition:

› Outcome-based

models

› Rainbow-based

Guest Services & Bots

› Room Automation and

IoT services

› Rainbow UCaaS

Education Transportation Hospitality Government

Added Value Leveraging Digital Transformation

Around USD 1.77 tn

spent on global digital

transformation by 2019

1.77 tn40%

40% of initiatives

supported by AI by 2019

10%

10% of all transactions

will be affected by

bots

› 70% of projects by 2020 will not be corporate

telephony related (core business)

› Growth hacking teams with cloud-first approach

› Recruitment of vertical-specific partners

› Accelerating digital transformation within,

started 3 years ago

› Transition into an OPEX delivery model

We will take

minimal risk

It’s not going to

happen to us

We have enough

time

CCTV: Closed-circuit television, TETRA: Terrestrial Trunked Radio, LBS: Location Based Services, WebRTC: Web Real-Time Communication, IVR: Interactive Voice Response

Digital Transformation Industry Market DXI Misconceptions - Transformation Drivers for ALE

Source:

ALE AND IBM PARTNERSHIP

ALE announced a partnership with IBM during the event, that aims to incorporate cognitive communication

capabilities in Rainbow – IBM Cloud will be additionally leveraged

6FRENUS, ALE, IBM

Integration of ALE Rainbow with IBM Cloud and Watson

Partnership Details

› Alcatel-Lucent Enterprise partnered with IBM to add cognitive technology to its

Rainbow product

› Rainbow will be upgraded with natural language processing and machine learning

capabilities

› IBM Cloud will be used to host Rainbow and developers who use IBM Cloud API’s can

access Rainbow

› Rainbow will also include a location based services add on

› The partners have planned a joint market approach focusing on healthcare,

education and government sectors

› This move hopes to disrupt the market with the introduction of the first communication

tool enabled with cognitive technologies

› Rainbow is a product of ALE’s

communications business unit

› Alcatel-Lucent Rainbow is a cloud-

based, enterprise-grade, Unified

Communication as a Service (UCaaS)

and Communication Platform as a

Service (CPaaS) that connects people

and systems

› Rainbow offers a Hybrid Cloud

solution for business collaboration

and unified communications

› IBM Cloud is a suite of cloud

computing services offered both as

an IaaS and PaaS

› Partners and customers can use the

integration of IBM Cloud with

Watson, IBM‘s AI platform for

enterprises

› IBM offers a broad range of Watson

and machine learning APIs to help

developers build own applications

Benefits for Rainbow

IBM Cloud Infrastructure

Location based services

Cognitive Communication

and Machine Learning

Access to Developer

Community

Joint Market Approach

PaaS: Platform as a Service, IaaS: Infrastructure as a Service

Announced during the event

Source:

BUSINESS DIVISION NETWORKS

ALE plans to make networks smarter via software and cloud infusion to enable products like network on

demand and smart provisioning

7FRENUS, ALE

› OmniVista Cirrus

› Network on Demand

› Location-based

Services

Management

ServicesWLAN LAN WAN

› OmniAccess Stellar

with express &

enterprise modes

› 802.11ac and Wave 2

Access Points

› Core: OmniSwitch

9900 and 6900

› Access: OmniSwitch

6560 and 6860

› IP/MLPS: 7750 SR,

7705 SAR

› ESR: 5725R, hardened

products for auto-

motive and railKey P

rod

ucts

Su

b-d

ivis

ion

s

Strategy

› Focus on mobility & IoT secured networks. Enable companies to build IoT device and traffic

policies using Automated IoT networks and IoT containment features

› Offering networking as a business service according to the specific verticals and the development

of customized APs per vertical

› Develop location-based services to facilitate asset and people tracking

› Deliver all networking solutions through the cloud with embedded analytics

Vertical Solutions

Differentiation Factors

Healthcare

Mobility

Government

Hospitality

Education

Offer Focus

› Location services & embedded

analytics

› Healthcare network blueprint

› Purpose built IoT L2 switches

› Long term maintenance & end of life

+5 years support

› JITC, CC, FIPS-140 and TAA

certifications

› Shortest Path Bridging containment

› Stellar APs with OmniVista Cirrus

network management solution

› APs purpose built for industry

› 100 Gig capacity in the core with

multi-gig access, OmniVista Cirrus,

Network on Demand, Stellar WLAN

› Help clients build

healthcare-defined

networks

› Match customer

deployment cycles

› Address stringent

security needs with

compliant operations

› Realization of ‚digital

rooms‘

› Deliver large

bandwidth for digital

content

Simplified network deployment

and management

Network on Demand portfolio

Intelligent fabric with IoT containment

Location-based services and analytics

› Around 40 partners for Network on Demand signed in 2017

› Network management services covers 15% of the network business

› Government, education, and transportation are the top 3 revenue

generating verticals with a combined revenue share of 57%

› ALE‘s Aruba OEM partnership has been complemented by its new Stellar

WLAN portfolio

› OmniAccess Stellar WLAN with WiFi Express (upto 64 APs) & WiFi

Enterprise (upto 4000 APs) focused on SMEs and enterprises resp.

› Mesh WLAN capabilities to reach remote areas without cabling

AP: Access Point, , ESR: Enterprise Service Router, MPLS: Multiprotocol Label Switching

Key Highlights Product Portfolio

Source:

BUSINESS DIVISION COMMUNICATIONS

The key objective of the communications division is to deliver solutions which are cloud-based, highly

scalable, and open for third party integrations via an ‘everything-as-a-service’ model

8FRENUS, ALE

Strategy

› Rainbow Hub delivered as a CPaaS to help companies integrate real-time communications

with business applications

› Provide hybrid communications while driving digital transformation in specific verticals

› Delivery as ‚Everything as a Service‘ business model and add AI capabilities

› Capitalize on the data collected through mass user acquisition and activation

› Recruitment of vertical partners and be a leader in the vertical CPaaS market

Vertical Solutions

Differentiation Factors

Healthcare

Mobility

Government

Hospitality

Education

Offer Focus

› Location services, OpenTouch

evolution, Rainbow WebRTC

Gateway, IP/XBS DECT dual mode

› Rainbow UCaaS, Rainbow WebRTC

Gateway, Multicasting, interactive

voice response (IVR) services

› Rainbow UCaaS (chat, VoIP),

Multicasting, natural language

processing bot

› Rainbow-based services and bots,

location based services, Rainbow

UCaaS, IP/XBS DECT dual mode

› Rainbow integration to learning

management system, IP/XBS DECT

dual mode VoIP, Multicasting

› Optimize hospital

consolidation and

care delvery

› Deploy and maintain

real-time services for

passengers

› Citizen engagement

› E-Government and

safety alerts

› Extended experience

from booking till

after check-out

› Connected know-

ledge experience for

students

Solutions for customer & citizen

engagement

Rainbow delivery as UCaaS and CPaaS

Ability to connect platforms, people,

processes, and objects

Flexible billing models i.e. Capex, Opex,

Subscription-based, Traffic-based

› Rainbow

› Rainbow API Hub

Public Cloud Hybrid CloudPrivate Cloud/

On-premHardware

› Rainbow

› Rainbow API Hub

› OXO Connect

› OpenTouch

› OpenTouch Enterprise

Cloud

› Handsets for Unified

Communications

› Partnership with IBM to use the IBM Watson analytics engine to help

enable cognitive communications

› Majority of the communications portfolio sold via channel partners

› Rainbow: 1000+ partners onboarded, 1.000+ customers, 235k cloud seats

› EUSO and APAC regions performed well in 2017

› Hybrid-cloud to deliver UCaaS in resell and referral modes for partners

› Delivery of private branch exchange (PBX) and unified communications

on public and private networks

Key P

rod

ucts

Su

b-d

ivis

ion

s

VoIP: Voice over Internet Protocol,

Key Highlights Product Portfolio

Source:

CUSTOMER STORY: RAWABI SMART CITY

ALE played a key role in the development of the first planned smart city in the state of Palestine through its

Rainbow CPaaS and UCaaS solutions, and high bandwidth-capable networking products

9FRENUS, ALE, Rawabi.ps

ALE’s involvement to help make Rawabi ‘smart’

Rawabi is Palestine’s first planned city and largest private sector undertaking. The project began in

2014 and aims to contribute to permanent new job generation and sustainable long term growth for the

Palestinian economy, supported by smart technologies and a high-speed fiber-optic network

Solution

› ALE provides the expandable network with 80Gbps

backbone core switches in the datacentre

› Secure WiFi for staff and public city-wide Wifi

› Rainbow CPaaS for smart city communication, UCaaS for

developing mobile apps

› Single network management point

› IP infrastructure to cope with big data traffic from smart

city installations – open API for integration

› Single solution connecting, reading and analysing data –

able to handle expected data in the future

› Communication for residents and collaboration for

businesses

› Business intelligence reports

Needs and Challenges

› The city has smart meters, CO2 sensors, traffic monitoring

and security sensors

› Data is collected within one platform in real-time

› Problems are predicted

› Jobs were created

› High appeal for start-ups to develop further smart city

solutions

ALE Value-add

› Technology matched and exceeded the requirements

› Provided network hardware, UCaaS and CPaaS with

Rainbow as well

› ALE took worked closely with the local team – two VPs

visited in person

› Process didn’t felt like normal procurement but as a

relationship

Outcome

Work

Grow

Live

Source:

FRENUS TAKEAWAYS

ALE’s efforts to completely change its sales strategy along with vertical focus and transition to OPEX is

starting to pay off, as evidenced by its healthy annual growth in the past year

10FRENUS, ALE

› As ALE is now predominantly selling through channel partners, the company needs

to strictly audit and ensure that the partners are completely committed to

ALE’s vision and strategy

› Grouping of similar markets across continents together for example, South American

countries with Southern Europe, will benefit customer facing teams to translate

past learnings

Revamped Sales Strategy

› Recruitment of vertical-focused partners will benefit ALE to develop and offer

domain expertise as a significant value add to prospective customers

› ALE can combine its present expertise and solutions in its focus verticals to come

up with a new smart city portfolio which has massive future potential

› Possible threat could be incentivizing change amongst current important

partners who are not totally vertical-focused

Vertical Focus

› Addition of a cognitive quotient to Rainbow via this partnership is an effective

step to help ALE move ahead of competition in terms of innovation

› Integrating IBM Watson with the Rainbow API Hub will help popularize the open

platform and incentivize developers to come up with innovative vertical-

specific APIs

› AI & machine learning abilities can help ALE offer end user derive more value

from normal conversations and rival competitors’ capabilities

Partnership with IBM

Frenus review of key highlights

› Current focus is on mass user acquisition and activation via ALE Rainbow which

can be viewed as an effort to use analytics to help monetize the underlying

data; representing a potential revenue channel

› Long term user retention will be a key success factor for their communication

solutions

› Using IBM Cloud to host Rainbow will further enable ALE to scale globally while

providing advanced analytics capabilities

Communications Business

› Cirrus cloud-based network management for unified access complements ALE’s

existing business services portfolio and is in line with the company’s OPEX vision

› ALE has concentrated on making its Stellar AP WLAN portfolio to be easily

deployed, managed, and scaled which act as significant USPs when combined

with the price and delivery model

Networking Business

Frenus GmbH

Plieninger Str. 90

70567 Stuttgart

Sriram GiridharMarket Advisor

+49 172 683 7766

[email protected]

www.frenus.de

Frenus GmbH

Plieninger Str. 90

70567 Stuttgart

Adam KenyeresSenior Market Advisor

+49 173 473 7744

[email protected]

www.frenus.de

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