Speed & convergence define the access network of the

future

Nokia next generation PON

Ana Pesovic, Fixed Networks Marketing
Nokia
October 2016

Eric
1 Festraets
Nokia 2015 - Director Business & Network Strategy Fixed Networks
Speed & convergence define the access network of the future

View on FTTx
View on deployments
View on technologies
apps & services

Fibre as the
Fixed
Better quality
of experience complements
wireless
cornerstone
of the network
2 Nokia 2015
Speed & convergence define the access network of the future

View on FTTx
View on deployments
View on technologies
apps & services

Fibre as the
Fixed
Better quality
of experience complements
wireless
cornerstone
of the network
3 Nokia 2015
The enigma of ever changing consumer behaviour

Prediction is very
difficult, especially
about the future.
Robert Storm Petersen
Danish cartoonist, writer, animator,
illustrator, painter and humorist

4 Nokia 2015
 Main service trends for today and tomorrow

GIGABIT FTT OFFICE MOBILE X-HAUL

Bandwidth vs. speed Passive Optical LAN Front/Mid/Backhaul

MULTI PLAY CLOUD WIFI OFFLOAD

One stop shop Smart IT Integration Seamless handover
Home

INTERNET OF INTERNET OF SMALL CELLS

THINGS THINGS Coverage & Capacity
Ecosystem New business models

Residential Business Backhaul

(Retail & Wholesale) (Retail & Wholesale)
5 Nokia 2015
 Gigabit : how much do you really need?
Sustained bandwidth Peak bandwidth
100
4K 3D 2160p 3DTV 720p BW Downstream peak
90 4K TV 2160p HDTV 720p Upstream peak
OTT
SDTV
80 3DTV 1080p Video download Speed test
Video Bandwidth (Mbps)

HDTV 1080p 15% CAGR Speed test Video upload

70 File sharing
60 Cloud storage

50
40
30 Downstream
average Upstream average
20 IPTV, Internet, voice Gaming, Video
10 communication
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Time

High bitrates are required to provide premium

customer experience and differentiate from competition
6 Nokia 2015
Human impatience is the killer app for a gig

Peak bandwidth is key for the

Cloud interactivity
user experience (human
Instant Gratification impatience is the killer app)

Immersive VR

Virtual Reality (consumer)

8K video (4x)
Sustained bandwidth
Online backup / storage (all users, all the time)
is basic enabler
4K Video (4x)

Home security

Web & Cloud apps

HD video (4x) Upstream (Mbps) Downstream (Mbps)

-1500 -1000 -500 0 500 1000 1500

7 Nokia 2015
 Multi play for the consumer From bundling to converged offerings

4 QUAD PLAY
Voice services
5 QUINT PLAY


Voice services
Internet services
Internet services Video services

3 TRIPLE PLAY
Voice services
Internet services


Video services
Mobile services


Mobile services
Smart Home

Video services

2 DUAL PLAY
Voice services
Internet services

1 TELEPHONE
Voice services

D o wn g r a d e c h u r n b y t a r g e t i n g
c o n ve r g e n t h o u s e h o l d s
8 Nokia 2015
Multi play for the consumer - The smart home challenge & opportunity

Integrated ONT/RGW/IOT hub or

Ethernet CPE/Gateway/IOT hub

Multiple hubs one per vendor

Multiple apps one per hub Single app in the mobile

Too many vendors/protocols/hubs/apps Simplified, integrated & handy Smart Home solution

9 Nokia 2015
Multi play for the consumer - Smart home service areas

Home Digital
Security Health
REMOTE HEALTH
Remote patient / elder
monitoring/assisted living
HOME SECURITY Potential savings, just in North-
36B worldwide market
(@2017, Goldman Sachs) Security Health America, $300B per year
Opportunity (US alone) $30B
Proven willingness-to-pay
by subscribers

Comfort Efficiency
ENERGY MANAGEMENT
IoT can make smart homes
Home
Smart 40% more energy efficient
Automat In developed countries,
Energy
ion 30% of energy
consumption is in homes -
significant overall savings!

10 Nokia 2015
Bringing a gig to every home is just the start
vRGW
vSTB
vIoT

IOT
vSTB Smart home
RG
W Connected home
ONT

Communication PON, xDSL, DOCSIS, 3G/4G/5G, GE

Home networking Wi-Fi
Entertainment IPTV, VoD, Internet TV, Gaming
Convenience Home Security, Digital Health, Smart Energy, Automation

11 Nokia 2015
Business & IT change significantly
Need to find better ways to communicate & collaborate

MODERNIZE Connect people, offices &

Customer Loyalty ENHANCE LEGACY
CUSTOMER SYSTEMS
applications smoothly
Programs rule EXPERIENCE

ADOPT
By 2020, 62% of CIOs
EXPLOIT CLOUD say running 100% of IT
BUSINESS SERVICES
INFO in the cloud

DIGITAL
TRANSFORMATION BUILD THE Can Slack
OF ENTERPRISE MODERN
WORKPLACE
replace email?
CONNECT
PHYSICAL
WORLD

75% of M2M projects lead to

new business models Data trust should be
MANAGE
TRANSFORM IT
SECURITY &
guaranteed in each
CAPABILITY
PRIVACY Data Centre
12 Nokia 2015
Fibre to the Office : Passive Optical LAN
vs Traditional copper LAN

Horizontal and Vertical cabling using fibre

instead of copper CATx cabling
GE connectivity to ethernet devices
Active Core switches replaced with single
centralised node
Aggregation switches replaced with
(passive) splitters and CPE devices to
terminate fibre

Premium service experience Lower cost to operate Long term solution

High capacity, market proven Simple network, easy to operate Fiber life span: 50+ years
solution Low power consumption Low cost evolution:
All services converged on one LAN Low floor space - same cables
- voice, video, data, WiFi, - same access node
surveillance, signage, etc

13 Nokia 2015
 Fibre to the Office : 50% TCO savings with Passive Optical LAN

Traditional LAN Passive Optical LAN

Equipment

1 fiber OLT +

Power
ONT access points

30 switches
-50% 2.5KW 1.5KW

TCO

Floor space
Cabling

Bulky CATx small-diameter

Cable bundles fiber bundle 25m2 <1m2
Office building with 5 floors, 124 desks/floor
14 Nokia 2015
Internet of Things : opportunity to improve peoples lives

Fatalities in car Water lost each Fatalities each

accidents are year in the US year worldwide by
often due to because of aging not following
human error and and leaky pipes, doctors
slow reaction1 broken mains and prescriptions3
faulty meters2
90% 2.1T gallons 1 mio
Mobile glucose Estimated energy Possible yearly
monitoring tools waste in US economic impact
can cut diabetes buildings due to of IoT applications
management inefficient and in cities in 20256
costs by4 outdated HVAC
systems5

50% 50% $1.6 trio

1 International Organisation for Road Accident Prevention; 2 NPR; 3 Huffington Post; 4 fiercehealthcare; 5 American Physical Society ; 6 McKinsey

15 Nokia 2015
 Internet of Things : validate the solution technically and marketwise

Innovation ecosystem Agile prototyping Concept showcase Market trials

refine
Automotive &
transportation
Retail &
Hospitality
e-commerce
Execution
Prototypes partners
Health & wellness
Test
Public sector
Ideate

Media & Prototype

entertainment
Education

Consumer Business
electronics models
Tech industry Service providers

Joined efforts of global leaders & innovators

16 Nokia 2015
Internet of Things : ecosystem to build the right partnerships

265 members 375 members/1500 products 450 members >550 members/>30,000 products

n g c o n n e c t p r o g r a m i s N o k i a i n i t i a t i ve
n e xt t o b e i n g p a r t o f Z - Wa ve / Z i g B e e / W i F i a l l i a n c e
17 Nokia 2015
Wireless Backhaul : market clearly moves to fibre

Advertising
Bus stops Lamp posts panels
92%
of PT
cell
sites
have
fibre
for
mobile
backhaul

Operators massively backhaul their Adding small cells (+ wifi)

macro cell traffic over fibre Equip urban locations with fibre

18 Nokia 2015
 Wireless complements fixed

Mobile Transport Hybrid access Fixed Wireless

Fixed networks for backhaul/ Boost peak speeds with hybrid Fixed wireless LTE as primary broadband
midhaul, especially for fixed/LTE CPE; instant connectivity in hard to serve areas; 5GTTH in ultra-
smart cells activation; resilience & dense urban areas, and for fast initial coverage
troubleshooting

19 Nokia 2015
 All customer segments have their needs

Residential Business Backhaul

Enlarge revenue opportunities by combining B2C with B2B

20 Nokia 2015
Speed & convergence define the access network of the future

View on FTTx
View on deployments
View on technologies
apps & services

Fibre as the
Fixed
Better quality
of experience complements
wireless
cornerstone
of the network
21 Nokia 2015
 Our vision: FTTDesk
A seamless fixed network LTE, FastMile
connecting everyone FTTH

and enabling every thing

XG-CABLE
FTTA

Vectoring, Vplus,
G.fast, XG-FAST vRGW
FTTN Cloud
vOLT &
CO Edge Cloud
FTTx vSTB
NG PON, 10G P2P
XLG-PON

Digital Home Last mile Converged Access Cloud

Bring gigabit into every Gigabit speeds over fiber, Range of ultra-broadband Minimize TCO with an
home, and enable the copper, coax innovation options to connect every optimal mix of virtual and
Internet of Things pushing the boundaries of home, enterprise, and physical functions
physics antenna
22 Nokia 2015
COPYRIGHT 2012 ALCATEL-LUCENT. ALL RIGHTS RESERVED.
Is all traffic going mobile? The facts and predictions
Mobile share Traffic by network type

CAGR of 24%

Source : Analysis Mason Source : OVUM

For 2020, fixed will show stronger growth Wi-Fi will support UK, France &
Germany
than mobile in most developed markets >40% of data traffic leading countries

Smartphone boom nearly over Wi-Fi data consumption/user :

Heavy demand for video data : from 30M (13) to 300 M (16)
Despite 4G, economics drive to fixed (video)
Connected TV
23 Nokia 2015
The world is going wireless, but wireless is going fixed

3G :100s of nodes 4G :1000s of nodes 5G :100,000s of nodes

24 Nokia 2015
 Access technology is converging to gigabit speeds

Fiber tomorrow XLG-PON and beyond

Fiber today NG-PON (XGS / TWDM)

Cable tomorrow XG-CABLE, DOCSIS 3.1 Full Duplex

Cable today DOCSIS 3.0

DSL tomorrow G.fast, XG-FAST

DSL today Vplus, G.fast

Wireless tomorrow (5G) 5G

Wireless today (LTE) LTE

0 5000 10000 15000

Sustained / Peak speeds (Mbps)
25 Nokia 2015
X marks the spot X as the Roman 10

X
FTTX XGS/TWDM-PON
GPON/EPON, P2P XG-FAST
XG-CABLE
Vectoring,
G.fast, Vplus
Next-gen fiber, dsl & coax

Copper

Fibre

FTTNode FTTCurb FTT FTTBuilding FTTHome

DistributionPoint
26 Nokia 2015
 Copper technologies : finding the right DSL is key
VDSL2 Vectoring (17a)

1000
G.FAST
>1000m
Vplus
Up to 106MHz
800 G.fast

G.FAST NOTCHED FOR VDSL2 300m

Aggregate bitrate [Mbps]

22 to 106MHz
550m
600
VDSL2 35b Shorter distance
VECTORING Increased bitrates
Increased cost
400 Vplus
VDSL2 VECTORING
VDSL2 17a
200

0
0 100 200 300 400 500 600 700 800 900 1000
Note: .5mm cable
Distance [m]
27 Nokia 2015
 Fibre technologies : PON evolution in a nutshell

Speed
(DS & US) Fixed Optics Tunable Optics

10G

Multiple
Wavelengths
(4 or 8)

2.5G

1.25G
1G

EPON GPON 10/1 XG- XGS-PON & Universal-NGPON

EPON PON1 10/10 EPON (TWDM PON)
28 Nokia 2015
It is reality : XGS/TWDM demos and trials Deployments:

Demo completed
Trial planned
Trial completed
Customer win

56 Demo
(all completed)
Demos:
39 Trials
(21 completed)

7 customers!

29 Nokia 2015
A single network for all your services and faster network monetization

Backhaul increasing cell

sites volumes and traffic,
Small cell backhaul over existing residential
network

Add more wavelengths to

cover more residential users
Residential FTTH
or boost their bandwidth

Backhaul large number of

FTTB and Remote micro-nodes to boost
TWDM tunable (10/10 or 10/2.5) node backhaul bandwidth on copper loops
TWDM tunable (10/10 or 10/2.5)
TWDM tunable (10/10 or 10/2.5)
TWDM tunable (10/10 or 10/2.5)
Increase revenue potential
XGS (10/10 or dual-rate 10/10+10/2.5) Business services with high revenue
GPON generating business
XGS dual-rate services

30 Nokia 2015
Speed & convergence define the access network of the future

View on FTTx
View on deployments
View on technologies
apps & services

Fibre as the
Fixed
Better quality
of experience complements
wireless
cornerstone
of the network
31 Nokia 2015
Todays view on the FTTH/B Market in Europe
Early 2016 in EU28 :
60M FTTH/B homes passed
16M FTTH/B users (26% adoption)
75% have GPON as
FTTH/B/dp technology
2M
users

Today in Finland :
1.7M fixed broadband users
1M users 94K users have FTTH
Lowest in Nordics/Baltics
3M users
2M users How to increase?

Stimulate Public Infra

1M 3M users Funding Sharing
Demand
users

Incumbent deploying GPON Reuse copper for last drop?

Incumbent deploying P2P
32 Nokia 2015
 With fibre deployment, the business case rules

FTTH Dense Urban Area Suburban Area Rural Area

CAPEX
(/subs)7000
Fiber drop
6000
Dark Fiber
5000

4000

3000 Trenching/ducts
Fiber drop Fiber drop
Dark Fiber Dark Fiber
2000
Trenching ducts Trenching/ducts
1000 Engineering Engineering OSP engineering
Home HW Home HW Home HW
Network HW Network HW Network HW
0
Note: 30% take rate

Pay back ~4 years ~8 years > 20 years

period

Investors take lesser and lesser risk

33 Nokia 2015
Compliment FTTH with FTTx
Dense Urban (2500 HH per Sq-Km)

INVESTMENT FTTx relative CAPEX per sub (ADSL baseline)

20
From FTTN (4x) to FTTH (15x) to 5G
(22x) 18 Civil Works and Cables

Network Electronics & Optics

Civil works and cable drives cost 16
TIME TO MARKET 14
Cabinets/POPs/Splitters

Home Equipment
Deploying FTTH is time consuming 12
Re-using existing copper and wireless Home connect & Install

sites can speed up deployment 10 Spectrum

8
BANDWIDTH 6
FTTH: 1Gbps (GPON),10 Gbps 4
(uTWDM)
FTTx: 100M (VDSL2), 100s M G.fast 2
Fixed Wireless: 1Gbps (5G) 0
OTHER FACTORS
(-) Aerial fiber, existing ducts
(+) difficulty to enter the home
Availability of wireless spectrum

34 Nokia 2015
 G.fast for solving issue of last drop
Five deployment models, five use-case optimized Vplus/G.fast platforms

Copper Indoor Copper Outdoor

FTTtelcoroom FTTbuilding FTTdoor&floor FTTcurb FTTpole&hole

1RU 19 rack- and wall- Optimized for indoor, FTTH enabler, avoid Optimized for low-end Environmentally hardened
mountable basement deployment entering the appartment cabinet deployment for extreme outdoor
Active cooling with fans without telco room GPON to G.fast AC or DC powered conditions
Front access for all Passive cooling conversion AC, DC or remote
interfaces Anti-tempering Reverse powered powered, future evolution
AC powered AC & remote powered, to reverse
future evolution to reverse
35 Nokia 2015
It is reality : powering the largest & most advanced FTTx deployments

VDSL2

56 VECTORING
CUSTOMERS

9 Vplus
CUSTOMERS
AT&T

13 Vplus
Trials

9 G.fast
CUSTOMERS

42 G.fast
Trials

25M+ VECTORING
LINES SHIPPED

36 Nokia 2015
 The converged access platform : bringing all puzzle pieces together
Mix of FTTH/X connects more people, sooner & at lower cost

FASTER TTM VDSL2

LOWER COST Vectoring

Vplus
FTTN

G.fast

GPON
HIGHER
SPEED FTTB

TWDM- 10G
P2P
PON EPON
DPoE
FTTdp

POL

37 Nokia 2015
FTTFrontDoor
Speed & convergence define the access network of the future

View on FTTx
View on deployments
View on technologies
apps & services

Fibre as the
Fixed
Better quality
of experience complements
wireless
cornerstone
of the network
38 Nokia 2015