Internet Futures
My Aim:
share some thoughts about the Internet and its future
think about some of the major factors that will shape our future
+
Why? The mainstream telecommunications industry has a rich history
Why? The mainstream telecommunications industry has a rich history
…of making very poor technology guesses
Why? The mainstream telecommunications industry has a rich history
…of making very poor technology guesses
and regularly being taken bysurprise!
Can the Internetdo a better jobof matchingtechnology touser needs?
One approach:
1. Observe the situation and what’s happening
One approach:
1. Observe the situation and what’s happening
3. Understand where this may lead us and what options may be presented on the way
One approach:
1. Observe the situation and what’s happening
2. Believe what we see
3. Understand where this may lead us and what options may be presented on the way
(the most dif
ficult o
ne!)
What’s Happening Today:User Preferences and the
Market for Services
What’s Happening Today:User Preferences and the
Market for Services
From radio to tv to ?
What’s Happening Today:User Preferences and the
Market for Services
From radio to tv to ?
What’s Happening Today:User Preferences and the
Market for Services
passiv
active
From radio to tv to ?
passive
What’s Happening Today:User Preferences and the
Market for Services
passiv
activeYouT ube
From radio to tv to ?
From telephony to chat to mashups to p2p to ?
passive
Service Profile Choices
open vswalled
garden
Service Profile Choices
open vswalled
garden Bundled servicesOpen collaboration
framework
Service Profile Choices
open vswalled
garden Bundled servicesOpen collaboration
framework
open delivery infrastructure vs Service / content
distribution networks
Service Profile Choices
open vswalled
garden Bundled servicesOpen collaboration
framework
Vertical integration
rolespecializatio
n
open delivery infrastructure vs Service / content
distribution networks
Service Profile Choices
open vswalled
garden Bundled servicesOpen collaboration
framework
Vertical integration
rolespecializatio
n
open delivery infrastructure vs Service / content
distribution networks
userproduced vs
externallyproduced
Service Profile Choices
open vswalled
garden Bundled servicesOpen collaboration
framework
Vertical integration
rolespecializatio
n
Passive usersActive usernetworks
open delivery infrastructure vs Service / content
distribution networks
userproduced vs
externallyproduced
What’s Happening Today:User Preferences and the
Market for Services
passiv
activeYouT ube
From radio to tv to ?
From telephony to chat to mashups to p2p to ?
passive
Today’s users have already clearlydemonstrated their preference foran active service profile based on sharing
What’s Happening Today:Demand for Bandwidth
1995
Kb Modem tailsMb Muxed Trunks
What mass market customers want for $25 per month !
What’s Happening Today:Demand for Bandwidth
1995 2005
Kb
Mb
Modem tailsMb Muxed Trunks
DSL tailsGb Lamda Trunks
What mass market customers want for $25 per month !
What’s Happening Today:Demand for Bandwidth
1995 2005 2015
Kb
Mb
Gb
Modem tailsMb Muxed Trunks
DSL tailsGb Lamda Trunks
fibre tailsBonded Tb Trunks?
What mass market customers want for $25 per month !
What form
of infra
structu
re investm
ent
profile can deliv
er this o
utcome
in 7 years tim
e?
What’s Happening Today:Declining Revenue Profile
for incumbent telcos
What’s Happening Today:Declining Revenue Profile
for incumbent telcos
How to fill the gap of theInternet’s revenue leak?
Usage
B u s in e s s
driverdimensions
++
‘’
empowered userspenetration
?
technology
surplus
enabling windows
++
Moore’s Lawtechnology pace
rapid infill
technology
surplus
enabling windows
? see it ...... seize it !
++
Moore’s Lawtechnology pace
rapid infill
technology++
networkshared
shift
ofpower
end usercapability
technology push and network architecture
technology
new productionparadigms
netw a network- service‘ ‘produced outside
o f the network‘ ‘
“Over the top”applications
++
Content production is a commodity application that users sustain through sharing, rather than a valuable service
that is produced externally through dedicated specialized production
channels
Content production is a commodity application that users sustain through sharing, rather than a valuable service
that is produced externally through dedicated specialized production
channels
technology
netw
a network- service‘ ‘produced outside
o f the network‘ ‘
“Over the top”applications
new productionparadigms
++
technology
surplus enablesdivergence
forsimplicityperformance
and
++
technology
QoS
Network VPNs
IMSsurplus enablesdivergencefor
simplicityperformance
and
++
technology
no need fo rIP- convergence
QoS
Network VPNs
IMSsurplus enablesdivergencefor
simplicityperformance
and
++
technology
no need fo rIP- convergence
Web 2.0 enabled user generatedcontent
QoS
Network VPNs
IMS
facebookdoppler youtube
wikipediagoogle
flickr
surplus enablesdivergencefor
simplicityperformance
and
++
technology++
tensions at the lower levels of the technology stack
Users simply want applications to work
Network operators often base their business model on driving complexity into the network
So who really wants a simpleend-to-end IP network?
And who is willing to payFor it?
IPv4
IPv4 NAT landIPv6?
usage
fuelling the usage growth fire
usage = scaling
usage
fuelling the usage growth fire
bandwidthswitching
routingaddressing
usage = scaling
storagedelivering
powerheat dissipationmemory speed
silicon density
storage efficiency
Please send heaps more….
fibre routes
Businessmodelling
is challenging when today’s businesses appear to have radically different ideas of what this business is all about
?
Businessmodelling
and very few of these ideas will be right!
?
is challenging when today’s businesses appear to have radically different ideas of what this business is all about
Businessmodelling
And some of these ideas appear to be just plain wrongeven now!
?
and very few of these ideas will be right!
is challenging when today’s businesses appear to have radically different ideas of what this business is all about
..today operatorstend to be veryhype driven ..
Businessmodelling
And some of these ideas appear to be just plain wrong!
?
and very few of these ideas will be right!
is challenging when today’s businesses appear to have radically different ideas of what this business is all about
..today operatorstend to be veryhype driven ..
convergence
NGN - . . . triple play
seamless networking
Businessmodelling
?
..today operatorstend to be veryhype driven ..
convergence
NGN - . . .
Everone is talkingabout it
triple play
seamless networking
Businessmodelling
?
..today operatorstend to be veryhype driven ..
convergence
NGN - . . .
Everone is talkingabout it
Fewhave actualexperience
triple play
seamless networking
Businessmodelling
?
..today operatorstend to be veryhype driven ..
convergence
NGN - . . .
Everone is talkingabout it
Fewhave actualexperience
.. andthe actualexperiences aremostly failures
triple play
seamless networking
Businessmodelling
?
Businessmodelling
Packet pushing is a commodity utility activity
Low margins
No product differentiation
Low barriers to entry
Deregulation and competitionValued services are overlays to the network
?
What are we learning?
Businessmodelling
Packet pushing is a commodity utility activity
Low margins
No product differentiation
Low barriers to entry
Deregulation and competition
Traditional revenue streams are vaporizingWired telephony Business data products
Mobile telephonyLocal Accessmonopolies
Valued services are overlays to the network
?
What are we learning?
Packet pushing is a commodity utility activity
Low margins
No product differentiation
Low barriers to entry
Deregulation and competition
Traditional revenue streams are vaporizingWired telephony Business data products
Mobile telephonyLocal Accessmonopolies
Investors are still nervous about telcos
Cost of capital is high
Shareholder returns need to stay highConsumers are fleeing legacy telcos in the face of price gouging
No residual expertise left in-house
Valued services are overlays to the network
Businessmodelling
?
What are we learning?
Businessmodelling
?
Informed decision making about network infrastructure investment is the key to the next few years!
Poor network investment choices will lead to business failures
Those who are prepared to questionthe hype and construct their networks in a way that supports user needs will emerge as stronger ISP players
So where arewe heading ?
My personal view sees the following..
T echno logy Business
Usage
?
.. involving users and other stake-holders
with differentrelationships
new roles being defined
?++
‘’
empowered userspenetration
So where arewe heading
My personal view sees the following..
So where arewe heading ?
commodity utilitynetwork operation
high capacitypacket pushing
network
My personal view sees the following..
So where arewe heading
user - drive, productionp2p,content, ..
?
commodity utilitynetwork operation
User-centric applications,not network-centric services
Value shift upthe protocol stack
high capacitypacket pushing
My personal view sees the following..
network
So where arewe heading
user - drive, productionp2p,content, ..
involving userspartners
?
Reinvention:
new
and different business models
commodity utilitynetwork operation
User-centric applications,not network-centric services
Value shift upthe protocol stack
network
high capacitypacket pushing
My personal view sees the following..
opportunities will arise with
a closing thought …
I’m probably going to be proved wrong as much as I may be right with these thoughts. There is no certain track of progress here.
Each shift of the Internet’s use paradigm through innovation is as much a surprise to the innovator as it is to everyone else.
Which is probably a very good thing!
Thank You!
Geoff [email protected]