Is the IP Evolution still on track?

Rob Bamforth,
Principal Analyst, Quocirca Ltd

June 9th 2009

Agenda

• Vision

• Enterprise needs

• Opportunities

• Perils of inaction

© 2009 Quocirca Ltd

The IP Vision

• Open standards

• Packets not circuits

• Anyone, anytime, anywhere on anything

Martini for the user…

..but a bitter „bitpipe‟ pill for carriers?
© 2009 Quocirca Ltd
Prediction, extrapolation, destination

„Rumsfeld‟ clouds

© 2009 Quocirca Ltd

Extrapolation predictions…

Beware analysts making predictions

Source: Best left unmentioned, 1998

Today‟s agenda

• Border peering

• SIP trunking

• IPX & mobile networks

© 2009 Quocirca Ltd

Some enterprise destinations

• FMC • Simplicity & Cost Control

• UC • Collaboration & Productivity

• DBI • Flexibility & Resilience

© 2009 Quocirca Ltd

Shift in the enterprise agenda

Past Need Importance

Connections and circuits Clouds and packets
Bill by time and distance Pay for service and quality
On premise On demand
ICT by products XaaS
Pay proportionate to use Flat rate
Separate channels Seamless
Dedicated, proprietary Open, multiplicity
Connected enterprise Extended enterprise
Simple media Rich media
Growth Survival

© 2009 Quocirca Ltd

The networked enterprise
Rich
client

Traditional

Pure on- Pure on-

premise demand

In-house deployment

Enterprise search
Browser
based Internet search
Increasing mobility

How will the number of mobile users change over the next 12 months?
0% 20% 40%

Increase significantly

Increase a little

Remain about the same

Decrease a little

Source: Quocirca telecom expense management research 2008

What‟s the impact on falling tariffs on total mobile costs?

0% 20% 40%

Falling

Still rising

Source: Quocirca telecoms costs research 2008

Expectation, Desire, Fear and Reality

• “superfast mobile broadband”

• “Live online”

• “no need for a landline, wires, hotspots or Wi-Fi hubs”

• “zip through emails”

• “watch YouTube howlers as you wait for the bus”

© 2009 Quocirca Ltd

The cost of sociable roaming

• 30 minutes of video roaming in Valencia? £30-£450

• 1 hour on Facebook in Florida? £25-£30

• 20 minutes of Britney in Bruxelles? £10 - £60

• The look on the face of the Finance Director when they

see the bill…….priceless!

• According to Quocirca telecom expense management research

in 2008, only half of UK companies make employees pay in
full for personal use of business mobiles (40% don‟t even
account for employee personal use….)

FM quality MP3 ~1MB/min, YouTube video ~5MB/min, average web use ~5MB/hour (15 average pages)
© 2009 Quocirca Ltd
How active are businesses with fixed mobile convergence?

0% 20% 40%

Already active

Starting/limited
Large Enterprise
SMB
Planned for this/next year

No activity or plans

Source: Quocirca UK communications research 2007 & 2008

 What does fixed mobile convergence offer?

0% 20% 40% 60% 80%

Simpler Lower Innovative Ease

Something networks call costs new services of use

Nothing
Nothing
Of interest

Source: Quocirca “Loud and Clear” 2008

What are the benefits?
0% 20% 40% 60% 80% 100%

Cost savings

Flexible working

Improve internal comms

Improve external comms

Future applications

Easing network management

Converging voice and data

Source: Quocirca telecoms costs research 2008

 Is VoIP being used for business calls?
0% 20% 40%

Informally
Consumer tools, such as Skype

Already Some Planned for

Formally widely used limited use this next year

Source: Quocirca “Loud and Clear” 2008

Are users implementing back door solutions with consumer messaging,
IP telephony and conferencing products?
0% 20% 40%

Definitely

Probably

Possibly

No

Don't know

Source: Quocirca Visual Impact research 2007

The distributed workforce

• Home working

• Mobile

• Flexible working

• „Hot desking‟

• Handy‟s cloverleaf model – outsiders inside

© 2009 Quocirca Ltd

The flexible workforce

What proportion of employees would benefit from untethered access to IT?

0% 20% 40% 60% 80% 100%

Working from home

Mobile outside the premises

Flexible location within the

premises

Most or all About half About a quarter Few

Source: “Transforming the workplace” Winter 2005
How much are companies extending their IT systems to those working
from home over broadband?
0% 10% 20% 30% 40% 50%

Already active

Starting up

Becoming active this year

No activity or plans

Source: Quocirca UK convergence/mobile research 2007

 What tools are provided by the business for home working?
0% 20% 40% 60% 80%

Mobile phone

Broadband connection

Laptop/PC

Home office furniture

Landline phone

Office PBX integration

Source: Quocirca “Loud and Clear” 2008

„Trusted external advisors‟

Which IT issues do companies look to a 3 rd party for assistance or guidance?

Turnover under £50m

Turnover £50m-£500m
Impact of ICT on business
60%
New technology
Vendor selection
directions 40%
20%
Product selection 0% Training

PS/consulting Strategic planning

Skills development

Source: Quocirca “Bodyshop to Mindshop” 2009

…not just advice!

Where are improvements expected when using third party consultants?

Those growing relative to sector
Business process
Those not growing
efficiency
80%
Overall business
Business resilience
60% performance
40%
Competitive advantage 20% Leveraging existing assets
0%

Controlling costs Employee productivity

Developing new routes to

Customer service
market

Source: Quocirca “Bodyshop to Mindshop” 2009

Enterprise – distributed & seamless

• Connection (FMC)

• Communication (UC)

• People (DBI)

• Network (IP)

Seamless, but with control

© 2009 Quocirca Ltd
Challenges for the enterprise

Challenges Unfulfilled need

Cost control Cost management
Connection diversity Complexity management
De-perimeterisation Security management
Availability Resilience management
Technology complexity Risk management
Shadow ICT Deployment management
Work/Life balance Service management
Communications fidelity Quality management
Legacy solutions Migration management

© 2009 Quocirca Ltd

Opportunities for carriers

Challenges Unfulfilled need

Cost control Cost management
Connection diversity Complexity management
De-perimeterisation Security management
Availability Resilience management
Technology complexity Risk management
Shadow ICT Deployment management
Work/Life balance Service management
Communications fidelity Quality management
Legacy solutions Migration management

© 2009 Quocirca Ltd

Carrier challenges in an IP world

• Insulation EweDP?

• Protection

• Discrimination

• Migration

• Monetisation

© 2009 Quocirca Ltd

Hence today‟s destinations

• Border peering

• SIP trunking

• IPX & mobile networks

© 2009 Quocirca Ltd

Where is IPX?

• Trials on track

• Broad participation

• Launches soon

• 8-10 IPX carriers with public statements

• Avoids islands, offers new opportunities

• Beyond GSMA with IPI Alliance by end of 2009

© 2009 Quocirca Ltd
Perils of inaction

dx
dt
© 2008 Quocirca Ltd
Conclusions

• IP has unstoppable momentum

• Voice is becoming YADA-YADA & commoditised

• Convergence is IT + telecoms

• Both bring something to the table

• “Bit pipe” is the destiny for un-imaginative carriers

“are we there yet?” – No, but well on the road

© 2009 Quocirca Ltd
Thank you

Any questions?

All Quocirca reports are freely available from www.quocirca.com

© 2009 Quocirca Ltd