Future Of IP Services Alex VishnevCTO VOIP SERVICES

Future Of IP Services Alex Vishnev(CTO VOIP SERVICES) Frederic Kunzi(CTO/CIO)

AGENDA • Introduction • IP Services – Market Overview – What are they? • Review of Services – Provider Perspective – Consumer Perspective • Technology – Architecture/Protocols – IMS ( IP Multi-Media Subsystem) – OSS/Billing

Brief History • • • Launched ACN in 1993 1998 opened Canada 1999 opened USA 2000 entered European market 2005 launched APAC starting with Australia

Current State of ACN • Global MLM Leader • Operating in the United States, Canada, Europe and Asia. Pacific. • Highly competitive services to Consumers and SMEs – local calling, long distance, DSL/Internet, Mobile – Vo. IP services to consumers and small businesses • $500+ million annual revenue • One of the fastest growing privately held companies in the world. • Double digit annual growth • Two Million+ Customers • Over 100, 000 independent Agents worldwide

ACN’s Mission Statement Our focused efforts and accelerated growth will allow ACN to be recognized among all industries as the World’s Leading Direct Seller.

Market Overview (Service Provider) • MSO (Metropolitan Cable Service Operators) offer cost effective single source solution for Cable, Voice and Video • Wireless providers encroach on Wireline revenues by providing wireless voice and internet services • Telcos Need Competitive Advantage to Retain Customers and increase ARPU (Average Revenue Per User)

Market Overview (Subscriber) • Home continues to grow more digital with every technological development driving multi-media content demands – Set Top Boxes(STB) and IP-DSTB( IP Digital Set Top Box allows delivery of triple-play service – Wireless IP Phones – PVR (Personal Video Recorders Ti. VO, Myth. TV, etc) – DVD/CD, Personal Video, Digital Cameras – Personal Home Entertainment Systems (Microsoft, etc) – HDTV – Gaming

IP Services • • VPN (IP/MPLS) Vo. IP Video Calling/Conferencing VOD IPTV Gaming (Xbox, Sony, Nintendo, etc) Mobile 3 G and IP Convergence – VOD, Gaming, Podcast, etc

IP VPN/MPLS (Provider) • Simple Service • Smaller Market/Low Customer Churn • Targets Larger Enterprise Customers with Multiple Offices • Security/Encryption • MPLS Enhancements – QOS and Better SLA Monitoring – Better Traffic Engineering – MPLS Deployments/Tiers • Edge/Aggregation/Core?

IP VPN/MPLS (Consumer) • Large/Medium IT Users – Security • Remote Work Force/Telecommuters – Authentication – Management – QOS – SLA Monitoring – Outsourcing Firewalls?

Vo. IP(Service Provider) • Traditional Telcos Money Makers – Voice Mail – Call Waiting – 3 Way Calling – LD/Intra-Lata/International Calling – Call Forwarding/Call Screening • Vo. IP Minute/Service Bundles – Save Costs on Calling Features/Rates – Enhanced Services Bundled – International and Domestic All-You-Can-Eat/Minute Plan – Specialized Enhanced Service Applications (On Demand Conference, Video Calling, etc)

Vo. IP(Consumer) • Saving Cost • Enhanced Services – Voice Mail – Call Waiting – Call Screening/Baring – Virtual Numbers • What’s Missing? – Quality/Reliability – Does 911/E 911 work? – Needs More Customization (Boring Service) • Ring Back Tones • Ring Customization Based on Caller ID (i. e. Mobile) • Presence Notifications

Video Calling/Conferencing(Provider) • Market has Been Hot and Cold for a Number of Years • Traditionally Built Using Proprietary Technology • Revenue Drivers – Large/Medium Enterprises – e. Learning – Remote Work Force • Strategy to Capture Mass Market – Bundling Video Calling Together with Vo. IP Calling – Improved Video Quality – Interoperability (Work In Progress)

Video Calling/Conferencing (Consumer) • User Demand is Still Small Comparing to other Services • Introduced to Market as Bundled Service with Vo. IP • High-end Video Phones are Still Expensive • Does not Inter-work with Home Cordless Phones

Video-On-Demand(Provider) • Various Categories of Video-on-demand – Interactive Video On Demand • Play, pause, rewind controls. Expensive to operate – Near Video On Demand • Buffering technology, reduces cost by increasing user wait time for services. Some VCR like controls • Video Streaming/Downloading – Low cost to operate – Served from Web – Large Variety of Content (Porn dominates the Market) – Free and Subscription Services • Competition with DVD Sales/Rental and Other Providers – VOD is winning over DVD Sales/Rental – Content and User Experience Differentiates Providers

Video-On-Demand(Consumer) • Watch what I want, when I want. – Large Content Selection (Domestic, International) – Pick the content – Schedule the delivery method and time – Pick the device (future) • Privacy • Security (Parental Controls) – Content Selection/Blocking for Children • Subscription Bundles – Group Content into Bundles (i. e. Sports, Kids)

IPTV (Service Provider) • • • IP critical to winning the broadband home – enables cross platform service creation with cost-effective standards-based approach Pre-IPTV – Video and Data on Separate Networks – Proprietary STB IPTV – Reduce Complexity and Cost – Interoperability with Multiple Hardware and Software Vendors – Video and Data on The Same Network – Standard Based STB – Additional Services (Weather, Games, Shoping, etc) – Integration with Wider Variety of Video on Demand Providers – Streaming TV to Mobile Devices – Integration with Home Digital Centers

IPTV (Consumer) • More Devices to Choose From • Integration with PVR • Integration with Other Digital Center Components (PC, Video Camera, Music, Photo) • Wireless Distribution inside Home • Content Personalization

Gaming (Provider) • Provide Positive Experience for On-line Gamers – Cheat Codes – Group Chat Rooms – Sharing of Information – Separate Content by Age Group (Children, Adolescent, teenagers, etc) – Parental Supervision Controls • Hosting Gaming Competitions • Drive Revenue through Sales of Gaming Components • Integration with Mobile Devices

Gaming (Consumer) • Competitive Fun – can compete against other gamers on your network or across broadband Internet access • Fast – Broadband Internet access offers the speed and reliability you'll need to play console games competitively online. • Cost effective – Variety of Devices Reasonably Priced Available from Many Sources • Flexible. – Users can connect with or without wires. • Safe. – Content/Age Separation

Mobile IP Convergence (Provider) • 2. 5 G Deployed in USA as 3 G Spectrum is Not Yet Allocated • Experience in 2. 5 G Allows Carriers to Better Define Needs and Services of End-Users • 2. 5 G Networks Used as OSS/Billing Test Beds Needed for Upcoming 3 G Deployments • Carriers use Enhanced Services of 2. 5/3 G to Drive Revenue and Increase ARPU – Nextel’s Push-To-Talk Yields Higher ARPU and Lower Customer Churn • Convergence has become a business requirement – Build Customer Loyalty – Minimize churn – Launch new services – Reduce Op. Ex – Increase ARPU (NTT, KT Shows Higher Revenue After 3 G Launch) • Use Standards to Create Services More Efficient

Difference in Architecture • • Layered Approach Separate Transport and Services Differentiating Services OSS/BSS Supporting New Services Service Provisioning Service Management/Monitoring Compliance to Various Government Regulations

Multi Media Network • Meeting all users needs at each end of a session • Interfacing to the IP core networks • Moving many different types of streams • Adapting streams to the needs of a session • Enabling opportunities to make money at many scales

Multi Media Network Challenges • • Wildly different and interacting devices Varied capabilities Multiple languages Mixed bundles User preferences Social requirements Privacy and Security

What is IMS (IP Multimedia Subsystem)? • IMS or IP Multimedia Subsystem represents a 3 GPP and 3 GPP 2 effort to define an all IP based wireless network as compared to the historically disparate voice, data, signaling, and control network elements • Although the IMS was originally specified for 3 rd generation mobile networks, it also provides an excellent service deployment architecture for any fixed or wireless network • IMS standards define open interfaces for session management, access control, mobility management, service control, and billing. • Carrier Grade Network with Lower Op. Ex and More Flexibility • SIP as a common signaling protocol allows independent software developers to leverage a broad range of 3 rd party application servers, media servers • Functionality of Network Core Services Do Not Change with Changes on the Access Network

IMS Architecture

IMS Network Elements • Access Gateway (AG): This network element provides an interface between the radio network (Access Network) and the IP-based network. • Call Session Control Function (CSCF): Provides control and routing function for IP sessions. • Foreign Agent (FA): Advertises itself to mobile stations in serving area. Provides registration information to Home Agent. Forwards packets from mobile to Home Agent. • Home Agent (HA): Tracks current Foreign Agent serving the mobile. Forwards packets to current FA. • Home Subscriber Server (HSS): Can take the place of a HLR in all-IP network. Contains AAA function and other databases

IMS Network Elements • Media Gateway (MGW): Provides interface for bearer traffic between IP and PSTN • Media Gateway Control Function (MGCF): Provides signaling interoperability between IP and PSTN domains – SIP to ISUP and vice versa • Policy Decision Function (PDF): As IP networks, unlike TDM networks, assign network bandwidth and resources in real-time, the PDF’s role is to assign resources according to demand Qo. S requirements. • Position Determining Entity (PDE): While some mobiles can determine position independently, the PDE can provide assistance by way of location determination algorithms • SIP Application Server: Represents a platform for SIP application development and operation • SBC – Session Border Controller

Requirements of an IMS platform • An open and standard architecture for easy development and portability of applications especially while IMS is still being developed and updated • A carrier-grade physical platform for reliable service delivery. • Provisions for connections to legacy network elements. – Integration with non-IMS Networks and Services • Scalability. Services should be securely deployable to thousands of customers on a single, cost-effective platform. • Robust and granular Quality of Service (Qo. S) per customer and/or per service. The essence of SIP-based services is their real-time and interactive nature. • Secure Participation of 3 rd Party Vendors • Network management and billing services.

An IP Multi-Service Platform End-to-End Business/Delivery Concept Sales Channels Customer Base IP Multi-Services Company Fiber MLM Online sale IP Multi-Service End-User Markets • Residential • SOHO • SMEs • Others Pt-to-MPts. Wireless Wi. FI Hot Spots Wi. Max (d, e, . . ) GSM/CDMA Power. Link Satellite Cable/TV IP Services Convergence Services Bundleling Other Channels IMS Convergence Services Creation or Acquisition Internet Access Services Fabric • Back-Office • Billing • CRM • OSS • ERP • Web Front End • B 2 B • Bus. Intel. • BPM • Web Front End • Customer Portal • Virtual Contact Center(s) Other LM/Transport Systems Integrator Installation and Technical support Company (Can be outsourced) Vo. IP GSM/CDMA Messaging Vo. D IPTV Photos/Music Security Appliance Management Remote Health Care Ass. Internet Content Services Other Services

OSS/BSS

OSS/BSS FOR IMS NETWORK • OSS Traditionally defined to deal with dumb networks with a thin control layer. • AAAA (Activation, Authentication, Authorization, Accounting) • Policy Management • Subscriber Management • Mobility Management • Network and Service Management • Application and Content Management • Device Management • Flexible Billing Capable of Supporting Different Business Rules • Customer Care

SERVICE RETAIL • Product Definition and Service Design • Flexibility and Service Personalization • Flexible Pricing and Pricing Bundles – Pay-per-use/view, Preview, Subscription, Gift, Promotions • Support for Multiple Storefront Access Methods – WAP, JAVA

SERVICE DELIVERY • Support for Multiple Delivery Options • Transport and Operator Billing Integration – 3 rd Party Billing, Wholesale Agreements • Service Fulfillment – Trace Order<->Shipment<->Delivery<->Activation Process • DRM (Digital Rights Management) to Protect Content • Tracking Order/Inventory Status for partners – Supply/demand

Operation & Support • Capability to fill supply, retail & delivery gaps • Global network operations, support & testing capabilities. • Distribution & Channel Management • Reciprocal Compensation and Settlement • L 1 & L 2 support for service retailers & consumers • Add promotions as a new service to existing user or new content to existing user of the service • Manage a service through its life-cycle including retirement and withdrawal of

CONCLUSION • ENHANCED SERVICES ARE RIGHT AROUND THE CORNER • ARCHITECTURE IS IN PLACE (IMS) • QUICKLY ADAPT TO CHANGES REQUIREMENTS • PREPARE FOR OSS/BSS CHANGES DRIVEN BY VARIETY OF CONTENT AND SERVICES • DO NOT GO FOR WORLD DOMINATION • MAKE THE RIGHT PARTNERS • FOCUS ON CORE COMPENTANCIES

Q&A Alex Vishnev Chief Technical Officer, Vo. IP 13620 Reese Blvd. Ste. 400 Huntersville, NC 28078 Office (704) 632 -3682 Mobile (704) 778 -7260 Fax (704) 947 -7112 Email avishnev@acninc. com Website http: //www. acninc. com