Cisco 5G Monetization Strategies

Redefining the Network Reimaging Opportunity

Presenter
Title
February 2021
 • 5G Is Different
• Opportunity Through
Change
Agenda • Initial 5G Use Cases
• Next Phase 5G Use
Cases
• Getting It Right

© 2017
2021 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
 5G | Buying Experiences

4G | Buying Connectivity
© 2018 Cisco and/or its affiliates. All rights reserved.
Cisco 5G
Redefining
Your Network

Converged Network Service Edge Virtual Security Services

Core Slicing Automation Distribution Scaling
Cisco Innovations in 5G
Converged Core
Cloud-Native Converged
5G Core supporting
licensed, unlicensed & IoT
Edge Distribution
Unified access: fiber,
licensed, unlicensed
Open RAN ecosystem
MEC & VPP for better QoS,
low latency experience
© 2021 Cisco and/or its affiliates. All rights reserved.
Network Slicing
Application driven slicing w/
Segment Routing & IPv6
Per application connectivity
& path optimization
Virtual Scaling
Cisco Cloud-Native for
scale & container location
Vector Packet Processing
for optimization
Service Automation
Cisco Crosswork full lifecycle
operation automation
Multi vendor, multi-domain
SON, SONFlex
Security
Hardened infra end-end
across physical & virtual
Industry leading Talos Threat
team (250+) for expertise,
R&D, remediation
5G Converged Core

• Cloud-Native Design
• CUPS Optimized (VPP)
• Proximity-as-a-Service
• Improved Automation and
Provisioning
• Transport and Mobility
Convergence (SRv6)
• Application function
influence on Traffic Routing

© 2021 Cisco and/or its affiliates. All rights reserved.

6
Opportunity Through
Change
What are the Opportunities?
Top Focus Areas for Technology Investment*

Automation mSD-WAN NaaS

Digitalize
Analytics Cloud
Virtualize IoT Network Slicing customer
Services
Infrastructure engagements
Mgd Sec Identity

23% of CIOs CSPs are growing their digital initiative

– But only 5% are realizing benefits.
© 2021 Cisco and/or its affiliates. All rights reserved. *March 2018 Gartner report
8
“A big part is unlearning some things…
…understanding that what made an
operator successful in the past will not
work in future…”

Shankar Arumugavelu, CIO

Verizon
9
Change Happens First from Within
The Change
Problem with current approach
The benefit of the change
The outcome
B2C Example B2B and B2B2C Example

Change the way services are priced Change the way services are offered

Traditional pricing does not create stickiness Traditional services take too long to deploy

Bundling increases service appeal Automate network services slices

IoT for 10 cents per device per month OR

$15 for Basic Smart Home service, and More Enterprise engagement through agile
$25 for Protected Smart Home service offerings

© 2021 Cisco and/or its affiliates. All rights reserved.

 Show Me the Drivers!

Customer experience
enhancement
Fast creation of new
business opportunities
Opex savings

Customer:
• B2B
• B2B2C
• B2C

© 2021 Cisco and/or its affiliates. All rights reserved.

Initial Use Cases
Initial 5G Services

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 5G FWA ENT Economic Model Overview
Objective: Understand the economics of deploying 5G Fixed Wireless and
identify market opportunities that offer highest return

Cost Revenue
• Target Metro Areas
Markets • Urban vs. Suburban

• Industry Verticals
Segments
• Company Size

• Equipment
• Power & Real Estate Pricing
• Service MRC
• Installation, Repair, and Maintenance &
• Adoption Forecast
• Telecoms expenses Adoption
© 2021 Cisco and/or its affiliates. All rights reserved.
 Market Segmentation: Size and Vertical
Number of Addressable Business Establishments

70% 5Y
0%
Rollout
100%
100% 80% Est.
38% 1.7m Est. Covered 765K Est.
7.3m Est. 79% Radio
Propagation

There are ~7.3M establishments in Small, Med.& ENT are Reduced number of target
US*. Est. defined as physical office thought to be ideal establishments due to roll out
locations of a company. customer segment. and coverage
*Small Business Administration
© 2021 Cisco and/or its affiliates. All rights reserved.
 Why FWA? New Revenue Opportunity
$1,400
5-Year Profitability Summary (annual numbers) Why FWA?
80%
59.2% 58.9% • Early “5G” Service Rollout
Millions

49.1%
$1,200
1,291 40%
• Low Hanging Fruit
$1,000 2.6%
893
0%
• Going after under served areas
$800
-40%
605
$600
530 -80%
But…
$400
-131.1% 256 364
-120%
• This is not a new business model
$200 308

131
250
• Open to competitive pressures
$0 57 -160%
Year 1 Year 2 Year 3 Year 4 Year 5
Revenue Cost Gross
Margin
Revenue Assumption:

7k 37k 93k 152k 226k $300/mo. for 1G service (med size office)
Year 1 Year 2 Year 3 Year 4 Year 5 $200/mo. for 150M service (small office)

© 2021 Cisco and/or its affiliates. All rights reserved. $150/mo. for add’l svc. (VPN or Firewall)
 5G Service | IOT Connected Device

Problem Outcome

How to extract the maximum value from 3.3B Expands SP footprint and relevance
devices with diverse connectivity requirements Uplifts Enterprise productivity
with correct policy, applied at the edge, into the
hybrid cloud at scale
Productivity Gain
from implementing 10-25%
IoT technologies
Solution

Mobile Reliable, High Quality Interactive

Connectivity Delivered by; Geographically
Dispersed 5G Cloud
Kinetic | Jasper | Hybrid Fog & Edge Distributed 5G 5G Connectivity
Network using Ultra CUPS
Data source: Ovum, Business Insider, McKinsey
Oodles of Connected Thingies

Auto and Transport Commercial and Industrial Communications

Computers Consumer Medical

© 2021 Cisco and/or its affiliates. All rights reserved.

Connected Cars – Show Me the $$$
Link Home Entertainment Package with Car Infotainment – Seamlessly
Network Slices for Telemetry and Infotainment

New CSP – Auto Manufacturer Partnership for B2B2C

© 2021 Cisco and/or its affiliates. All rights reserved.
Add Value to Your 5G Service

What you are doing What you want to be doing

I sell you a Network Slice that

will provide you:
I sell you bandwidth • A customized network -
What you do with it is wherever you need it
your business • Meet your exact SLAs
• Give you Control and
Visibility

The Profit is in Simplifying the Complexity.

© 2021 Cisco and/or its affiliates. All rights reserved.
Profits are in Simplifying Complexity

Network Slices Telemetry Analytics Automation

Control Policy Identity

Becoming a better partner

© 2021 Cisco and/or its affiliates. All rights reserved.
Next Phase of
5G Use Cases
 5G Service | Network-as-a-Service

Problem Outcome

Operationalizing infrastructure is the biggest overhead Invest closer to your customer;

and drag on speed of innovation and time-to-market focus on building great services
Need a new approach to network operation and Trust NaaS to dependably connect
service creation customers and enterprises to
applications, content and services
Solution
Automation

Cisco network technology packaged for rapid &

flexible adoption
SR-Enabled
CUPS,
Automated slices-on-demand for clients and apps Mobile Core
Distributed
Edge
Cisco Services augments your operations to speed
operationalization of NaaS deployment Policy drives
Cloud Native
network slicing
Software
NaaS Use Case-1
Elastic CSP Multi-Cloud for On-Demand Scaling during
planned or unplanned events

Services
User FWD Services
Consumer vEPC
Plane and Apps
Cisco / Cisco /
Cisco NFVI
SP NFVI SP NFVI

CO/MSO Central DC

Give your customers what they want, when and where they want it
 NaaS Use Case-2
Simplify and Accelerate New Services
Delivered from Multi-Cloud to Client
vEPC
mSD-WAN
FW IPSec
CPE
Routing vEPC
vBranch
Virtual Mgd Service
Cisco / Cisco /
SP SP Cisco NFVI
NFVI NFVI

CO/MSO Central DC

Services Easy to Order – Delivered Fast

© 2021 Cisco and/or its affiliates. All rights reserved.
 5G Service | Mobile SD-WAN

Problem Outcome

Lack of enterprise visibility and control over Cisco VMS reduces complexity of
enterprise devices at the edge of the network delivering new, innovative services: 5x
In 2018, mobile devices will generate the majority of opex saving over 5 years
internet traffic*, which are off-fabric when mobile SD-WAN extended to utilize 5G
network slicing for enterprise grade
Solution assurance for secure mobile client to
cloud connectivity
Cisco VMS platform for service creation of intent based
networking and SD-WAN fabric with Viptela and
Meraki services
Cisco direction is to extend the SD-WAN fabric and the
enterprise edge into the SP network for mobile device
connection
© 2018 Cisco and/or its affiliates. All rights reserved.

* Akamai Internet Observatory

 5G Service | Mobile Managed Security

Problem Outcome

Security is required at scale for Enterprises and
consumers to ensure encrypted, robust, secure
connectivity from cloud to client.
Solution
Securing your network for service
assurance and securing your customer’s
networks to add managed security to your
portfolio, increasing revenue while
reducing churn

Managed mobile security services with Meraki,

Umbrella, AMP. Network security solutions with
NGFW, SecGW, Stealthwatch, ISE & Umbrella.
Augment your expertise with Cisco Security experts at
Talos, plus advise on implementation and ongoing
protection.
 5G Service | Mobile Video

Problem Outcome

Scaling networks to carry video, which is at the Monetize premium mobile video
core of all mobile services delivering a richer experiences, including Zero Rating
user experience – further enhanced through or Special Billing, Smart Data
AR/VR integration Caps with assured experiences

Solution

Video solutions integrated with Cisco Mobility

solutions through open APIs, including; MDSO
/ SON / ADC / CUTO / MOG / Ultra Services
Platform / Policy + Infinite Video Platform
 5G Service | Enterprise Collaboration
Problem
Cost effectively extending the mobile network
to securely include; Enterprise services,
devices and applications to an increasingly
distributed mobile work force
Solution
The Future of Work. New SaaS offer for SPs
enterprise customers for secure collaboration with
Cisco Spark – Create. Share. Do. Always on, to
seamlessly connect users no matter where they are
located
Outcome
Address the growing demand for
enterprise collaboration services in a
borderless office environment
Cisco’s WebEx Teams is a secure, long
term Enterprise grade solution that drops
right into the 5G ecosystem with our low-
latency capable network
Cisco 5G
Distributed Edge
 5G Service | Connected Mobile Experience

Problem Outcome

Lack of insight within network services Bringing context and awareness of connected
limits operational effectiveness and items for enhanced inventory management,
customer visibility quality of experience, customer visibility,
workflow optimization, etc.
CMX Analytics, Meraki Analytics, Wi-Fi
Solution Insights from Cisco AS, operator
connections/onboarding via Passpoint
Mobile World Congress scale public Wi-Fi –
brought to you by Cisco and over 1200 APs
Intent Based Networking with Gbit wireless
speeds at scale in unlicensed spectrum
Plan, Deploy, and Deliver public Wi-Fi
se©r2v01i8ceCissco afnad/osr tites arffiliaatesn. dAll rsighets
cresuervreed.ly
…but first you have to have
the RIGHT network in place
Cisco 5G PowerX | Delivering Consistent Value

Collaboration Connected
Device

Network as a Service Video Smart Cities

Security Experience SD-WAN

Delivery Simplified Economics Shifted Ecosystems Expanded

Cisco 5G : Redefining Your Network
Your network needs to do more than just Connectivity

Now: Maximize the return on initial use-cases FWA and eMBB

Next: Connect SP assets to the multi-cloud, unlocking desired use-cases

Focus: Value-chain realignment using 5G technology delivery

Outcome: Differentiated customer experience leads to sustainable value creation

© 2018 Cisco and/or its affiliates. All rights reserved.

 Cisco 5G Cloud Era Vision

Secure Common Platform

Rapid Time to Money

Flexible Business Models

Network Platforms Connected Services