Fixed-Mobile Convergence … · Fixed-Mobile Convergence Market Drivers Incumbent Local Exchange Carriers (ILECs) Counter the wireless substitution serious threat Broadband Telephone

Fixed-Mobile Convergence:Roaming between Wi-Fi and Cellular

CDG Technology Forum on FMC

Caesars Palace – Florentine I & II

Friday October 7, 2005 2:30PM – 3:00PM

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Enable and Protect All Forms of Interactions on Voice and Data Networks

Our Mission

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VeriSign’s Intelligent Infrastructure Portfolio

Internet Services Group Communications Services

Naming & AddressingDirectory

AuthenticationPayments

Managed Security

SS7 / IP ConnectivityIntelligent DatabaseBilling and PaymentsNetwork Mediation

Mobile Content

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Enabling and Protecting Billions Every Day

Communications ContentCommerce

Intelligent Infrastructure ServicesDirectory SecurityConnectivity Mediation

+ 14b DNS queries+ 3b PSTN queries+ 140m IN queries+ 1b security events

+ $100m e-commerce+ 130,000 merchants+ 450,000 websites + 7m billing subs

+ 200m SMS messages

+ 700,000 content transactions

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Exciting New Products

Digital Content Services▪ Market leader in Europe, launching US

Unified Authentication Services▪ U.S. Bank / Bank of America adopt

VeriSign strong authentication

IP Connect Services▪ Suite of VoIP interconnect services

New “VeriSign Secured” Seal▪ Serving 18 million per day

Intelligent Supply Chain Services▪ Awarded contract to run Object Naming System

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Fixed-Mobile Convergence Market Drivers

Incumbent Local Exchange Carriers (ILECs)▪ Counter the wireless substitution serious threat

Broadband Telephone Companies (ASPs)▪ Mobility enhances VoIP value proposition to capture share from ILEC

Multi-Service Operators (MSOs) ▪ Quadruple play – Cable TV, Broadband, VoIP, and Mobility▪ Utilize service bundling to capture market share from ILEC

Mobile Network Operator (MNO)▪ Remove the final barrier to wireless substitution – poor coverage▪ More importantly, add fixed line service (VoIP) capture share from ILEC

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Mobile Virtual Network Operator (MVNO)?

Fixed line operator’s call to action on a mobility strategy is critical▪ However, an ill-planned effort will miss the mark

Dilemma, become MVNO and fuel wireless substitution ▪ Reseller of competitor’s product

VoIP over Wi-Fi presents opportunity to add value to MVNO▪ While in home/office, Wi-Fi enabled handset access to landline service

Blended rate plan▪ Move beyond the typical MVNO prepaid business model

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Market Requirements

Support existing usage patterns, seamless user experience ▪ Mobile device, single phone number, mobile address book

Anchor user’s identity and services to residential/enterprise (US/CND)▪ Divert indoor mobile phone minutes of use to landline ▪ Preserves cellular minutes for use outside office/home▪ Single number, direct inward dialing (DID) and caller id (CLI)▪ Single voice mailbox (w/ cross notification)

Facilitate user controlled mid-call handoff (Wi-Fi to Cellular)▪ Capability to turn on/off automatic in-call handoff▪ User acknowledged liability for mid-call rate plan change

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Today’s Work Around Technology Solutions

Most work around solutions, designed to bypass MNO cooperation ▪ Two telephone numbers integrated through presence ▪ “Click Call Delivery” call forward from Class5/PBX, hides mobile number▪ “Click to Call” web access to Class 5/PBX call control, hides mobile CLI

Maintenance of two subscriptions devalues convergence▪ Adds complexity and overhead, reducing margins

Affective technology solution features true service convergence ▪ Wholesale roaming relationship - as apposed to MVNO

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Home-MSC Technology Solution

Ideal solution “true service convergence”▪ Fixed line (VoIP) assumes role of home mobile exchange

Single telephone number homed to user’s landline service▪ Call completion features landline based (voicemail, call forward, …)

Roam to cellular model, calls routed to landline handed off to mobile▪ Enables fixed line infrastructure to interrogate HLR (roaming location)

Public Telephone Network (PSTN)

Handoff

Converge Services Gateway(SIP to IS-41/GSM-MAP)

IP

Directory number homed to residential/enterprise

Landline

No answer handoff to cell phone

CellularMobile phone service

SS7

Handoff to Cellular [call delivery]• step 1 location discovery [TLDN] • step 2 call forward [route to TLDN]

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CellularServing-MSC

VoIPLandline Services

Infringes on Cellular Operator’s Network

Roam-to-Cellular necessitates access to home location register (HLR)▪ SS7 access to query/update roaming information ▪ Provisioning access to customize call completion and messaging features

Cellular operator reluctant to grant such invasive access▪ Landline homed number and HLR access are key market barriers▪ Apprehensive of loosing indoor MoU revenue

Cellular Operator’s Home Location Register (HLR)

Network Convergence Gateway inter-standard roaming (SIP to IS-41/GSM-MAP) simulates Home/Gateway-MSC SS7 access to HLR to identify cellular

presence (TLDN) and updates to HLR to reflect Wi-Fi presence (for SMS delivery)

IP

SS7

SS7

Population of landline numbers anchored to fixed line service

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VeriSign’s has long history of enabling roaming

+ In 1993, received CTIA designation as Cellular Backbone Provider

+ In 1999, VeriSign deployed GSM MAP signaling

+ In 2004, VeriSign began integration of SIP signaling

+ Enabling roaming across all wireless network technologies▪ GSM and ANSI-41 licensed spectrum, SIP unlicensed spectrum

In-Building

Home-CellPico-CellMicro-Cell

UrbanSuburban

Cellular(GSM/CDMA)

Wireless LAN(VoIP over 802.11x)

Inter-Network Roaming(seamless end-to-end service)

Macro-Cell

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VeriSign’s Wireless IP Connect Service

Inter-System Roaming▪ Home System - fixed line infrastructure (unlicensed spectrum) ▪ Visiting System - cellular network (licensed spectrum) ▪ Clearinghouse - VeriSign Managed Service

VeriSign’s Settlement Services▪ Billing feed (CDMA CIBER/GSM TAP)

Visiting Location Register (VLR)

Billing Support System (BSS) Serving Mobile

Switching Center (MSC-S)

Visiting System

Inter-Carrier

Billing Exchange

Roamer

Authentication/Location

Roaming

Inter-System Roaming Clearing and Settlement

VoIPHome System

Appendix:Go to market use case

A tool to expand and better serve the low tier and security/emergence markets

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Target market low-tier subscriber markets

Inter-carrier roaming agreements from ¢15 to ¢35 per minute

Average subscriber logs 490 minutes per month (Yankee Group)▪ Today, “bucket” of 400 anytime minutes $39.95/month ▪ Assuming only 72% of anytime minutes used, cost is 14¢ per minute

Therefore, not attractive option for medium- and high-tier markets

Intermittent cell phone users ▪ Minimal post-paid rate plans,

¢17 to ¢24 per anytime minute ▪ Prepaid rate plans, ¢25 to ¢35

Therefore, attractive option for low-tier and security markets

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Potential market size

Low-tier consumer and business as well as security/emergency markets represent 38% of subscriber base (approx. 48 million)

Low-revenue (ARPU $25 to $40 with acquisition costs of $300)▪ Most cellular operators try to move these users to other segments or

other network operators (ideally one of the operator’s MVNOs)

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A vehicle to increase cellular penetration

Low-revenue consumer markets to drive penetration▪ Pre-teen, teenager and college markets (over 35 million users)▪ 30% of credit worthy population without service (56 million users)

Cellular operator’s contractual sales model is not the answer ▪ Operators need to reduce acquisition and operating costs

Pay-per-use landline channel introduces new business model▪ No cellular contract or paying monthly cellular fees▪ Landline operator bears customer acquisition costs▪ Cellular operator wholesale relationship with landline operator

Cultivating channel means change in cellular business model▪ Cellular operator should remove equivalent amount of acquisition

costs from wholesale roaming charges to impact viability of new consumer product

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Value propositions across supply chain

Mobile Operator▪ Cost effective service delivery for low-revenue subscriber base▪ Try-and-buy service leads to contract cellular subscription

Multi-Service Operator (Cable or Landline)▪ Improves competitive position, addition of mobility▪ Drives broadband penetration

Handset Manufacturer▪ Stimulates handset churn, upgrade to dual-mode▪ Increases market size, cordless phone displacement

Subscriber▪ Improved indoor (home/office) coverage▪ Multi-service bundle, discounted telecom services on “One Bill”

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Product:Wireless IP Connect

Sean Kent – Convergence Product Manager(mailto) [email protected](tel) 703.948.4240