SP WiFi Monetization Strategies. Maurizio Gradi Sales Business Development Manager

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2 SP WiFi Monetization Strategies Maurizio Gradi Sales Business Development Manager

3 Agenda Cisco Universal WiFi for SP architecture Business Models Enabling Tecnology Customer Use Cases 3

4 Cisco Universal Wi-Fi for Service Providers Cisco Policy Management Cisco USC 5000 Series for Aironet 3600/3700 Cisco ASR 5000 Cisco Aironet ac Indoor & Outdoor APs Mobility Services Engine Small Cell Gateway Internet Cisco 8510 Wireless Controller Subscriber/MNO Gateway Cisco ASR 1000 Cisco Prime Management

5 Business Models

6 Business Model Differentiation Leads to Value Creation Save Money Make Money Retention and Loyalty Cost-Effective Increased Network Capacity Managed Connectivity Services Location Analytics Location-Based Advertising 6

7 Business Model Differentiation Leads to Value Creation Save Money Make Money Retention and Loyalty Cost-Effective Increased Network Capacity Managed Connectivity Services Location Analytics Location-Based Advertising 7

8 Wi-Fi and Small Cells Are Integral to Fighting Churn Retention and Loyalty Aggressive Wi-Fi deployment for Western Canada; bundling broadband with public Wi-Fi access Public Enterprise Small Cells to improve coverage and accommodate data traffic Wi-Fi is a churn-reduction strategy. Peter Bissonnette, President 190,000 Small cell-base stations in Japan 44,000 femtocells 8

9 A Business Case for Differentiating with Wi-Fi Retention and Loyalty for Triple-Play package $49 offered by competitor $495 High subscriber acquisition cost $115 Average monthly revenue per subscribe OPTION A: Differentiate with Wi-Fi Retention Savings $14.0M OPTION B: Match Competitive Pricing Total Wi-Fi Costs $10.1M OR Net Gain $3.9M Foregone Revenue (net loss) $6.0M Service Provider ended up ahead by $9.9M by differentiating with Wi-Fi 9

10 Business Model Differentiation Leads to Value Creation Save Money Make Money Retention and Loyalty Cost-Effective Increased Network Capacity Managed Connectivity Services Location Analytics Location-Based Advertising 10

11 Wi-Fi and Enterprise Small Cells Provide Cost-Effective Indoor Network Expansion $ / square meter $3.00 $2.50 $2.00 $1.50 $1.00 Cost vs. Density of Traffic Macro $0.50 Stadium DAS Repeater $0.00 Indoor Small Cell Mbps / square meter Carrier Wi-Fi Small Cells and Wi-Fi provide better cost vs density of traffic compared to DAS and macro networks Combinations of small cells with Wi-Fi will add MORE capacity By 2017, 70% of all licensed small cells will include Wi-Fi Source: Mobile Experts, Reaching a Balance Between Macro, Small Cells, and Carrier Wi-Fi, February

12 Increased Capacity for both Mobile Data and Voice Mobile Data Offload 32,000 Public Wi-Fi hotspots % +200% Venue footprint in 2013 x3 Wi-Fi connections during 2013 More mobile device traffic exchanged on the Wi-Fi network Wi-Fi works in tandem with our global network to keep people connected wherever they are. Wi-Fi is a clear factor in mobile use, driving purchase decisions to enriched hospitality, fan and travel experiences. Josh Goodell, AVP AT&T Wi-Fi Services According to Small Cell Forum, Enterprise Small Cells Will Source: Small Cell Forum 2013 Provide additional mobile coverage, capacity and services Offload subscribers to reduce network load and improve customer experiences 12

13 Case Study: Middle East Tier-1 Mobile Operator Wi-Fi Offload Savings Mobile Data Offload Mobile subscription to grow x5 7% of mobile data traffic to be offloaded by % M M Mobile broadband data usage to grow x MB/Mo GB/Mo Representing $3.6B savings 1.6% 185 M 290 M 425 M 615 M 830 M 1.1 B Service Provider Subscription and Traffic Forecast Through

14 Business Model Differentiation Leads to Value Creation Save Money Make Money Retention and Loyalty Cost-Effective Increased Network Capacity Managed Connectivity Services Location Analytics Location-Based Advertising 14

15 Managed Connectivity Services with Wi-Fi and Enterprise Small Cells Managed Services Venue and retail owners start using Small Cells as a way to improve business Creates an opportunity for service providers offering managed Small Cells Generate more customer traffic attracting more customers Increase customer dwell time more time spent = more money Managed Private Network for secure business and wholesale operations Managed Public Network for guest Internet and voice access 15

16 Key Vertical Managed Services Business Models Managed Services Transportation Centers 30 second video every minutes of access Subscription model for higher speeds starting at $4.95/hour Connecting frequent and occasional travelers Hospitality Subscription models: free access for value-hotels and up to $5 30/day for luxury hotels Tiered pricing model and customized applications available for VIP customers Connecting hotel guests and visitors Stadiums Connecting fans to social media Retail Connecting retail store customers Paid subscription to users, as low as $7.95 / 24 hours Paid apps to access in-venue premium content Ad-supported connectivity Opportunity for SPs: $3 5M Partner with retail chains to provide Wi-Fi and managed services Free Wi-Fi is offered to retail customers in exchange for analytics and marketing 16

17 Wi-Fi Wholesale Case Study: MSO Wi-Fi Used for Mobile Data Offload Managed Services A single access point is offering three SSIDs, one per service Cisco outdoor AP 1552C With CleanAir technology installed Mobile SSID is a closed (secured) network; Mobile operator users connect and authenticate automatically via EAP-SIM MSO broadband clients are eligible for free public Wi-Fi through this SSID With Passpoint (Hotspot 2.0) selection of the right SSID/AP will be secure and automated 17

18 Easily Add Managed Small Cells for Voice Coverage Managed Services Reduced network costs and operations with integrated design Cisco USC 5310 / USC 8718 Reduced CapEx reuse of Ethernet connection and power Zero touch configuration and provisioning Secure, carrier-grade 3G base station technology Standards-based Home Node B with specified Iuh interface Cisco Aironet 3600 Power/Backhaul/Real Estate Solved 18

19 Business Model Differentiation Leads to Value Creation Save Money Make Money Retention and Loyalty Cost-Effective Increased Network Capacity Managed Connectivity Services Location Analytics Location-Based Advertising 19

20 Location Analytics and Big Data Location Analytics Customer journeys Common paths Popular destinations First stop Visit duration Visitor patterns Repeat vs. first time visitors Venues Gather Valuable Location Data 20

21 Location Analytics and Big Data Location Analytics Quantify and justify rental pricing Analyze changes impact Measure signage impact Perform predictive analytics Venues Make Data-Driven Decisions 21

22 Service Providers Launching Analytics Business Units Location Analytics Dynamic Insights Pinsight Precision Marketing GeoVision 22

23 Verizon Precision Marketing Location Analytics Dedicated business unit to help companies understand their customers usage data Aggregates and anonymizes subscriber data and reports Extension of online information, with websites tracking clicks and visitor information and interests Allows customers to opt out Verizon is working to sell demographics about the people who, for example, attend an event, how they got there or the kinds of apps they use once they arrive. 23

24 Business Model Differentiation Leads to Value Creation Save Money Make Money Retention and Loyalty Cost-Effective Increased Network Capacity Managed Connectivity Services Location Analytics Location-Based Advertising 24

25 Mobile Advertising Is Broken Average CPM $ by Advertising Type Location-Based Advertising Online video ad UGC Online Banner Cable Network Broadcast TV Online video ad (prem.) Broadcast TV primetime Cable (local) Hulu (popular content) Cable (highly targeted) Mobile Want that Getting this Source: RCBG analysis of advertisement market $0 $20 $40 $60 $80 Mobile CPMs are below expectations, closer to desktop than television 25

26 Mobile User Behavior Reveals Opportunities Location-Based Advertising 50%+ of all purchases influenced by mobile apps and social media 19% of mobile users turned on location services in % of users who receive locationbased services consider them valuable Source: Conlumino, TNS Global, Nick Lippis UK retailers missing out on up to 12 billion in potential sales by failing to engage consumers through digital channels 26

27 Cracking the Nut with Wi-Fi Location Location-Based Advertising Volume-Based Impressions Venues 100% LBS No $2-$5 ecpm Targeting-Based Mobile Ads Venues 10% LBS Yes ecpm $24 100% 80% 60% 40% 20% 0% $5.82 ARPU uplift by year five x2.5 More mobile advertising revenues in 5 years Volume-Based Impressions % OF WI-FI VENUES ENABLED FOR ADVERTISING Hyper-Targeted Source: Cisco & RCBG SP Wi-Fi Monetization Research (2013) Moving to Targeted Mobile Advertising 27

28 Enabling Technology

29 With Cisco CMX (Connected Mobile Experience), You Can Detect Connect Guest Presence Guest Access Engage Guest Experience Mobile device detected Smooth, secure Wi-Fi connection API/SDK-Enabled Experience Location Analytics Facebook or Custom Login App or Browser Engage Analytics

30 Cisco CMX Analytics Boost operational efficiencies How Long Were People in the Venue? Detect Analyze business performance to improve in-venue marketing Before/After Zones Optimize layouts to increase revenue per square foot Number of Devices per Zone Increase customer satisfaction by understanding patterns and adjusting staffing

31 Location-Specific Guest Access Cisco CMX Connect Customize the Wi-Fi guest access experience Gain valuable analytics about who is in venue Simplify the user experience while offering clear terms and conditions Connect Registration, Terms, and Conditions Custom Landing Page/ Video Simplified Login

32 Cisco CMX for Facebook Wi-Fi Easy Guest Access Connect Increase brand recognition and gain insights through Facebook Wi-Fi User connects to Wi-Fi, opens browser, and checks in Venue gains exposure through news feeds, notifying friends

33 Using Location-Based Wi-Fi to Engage Consumers Engage þ þ þ Work with Cisco and/or Ecosystem Partners to Align to Business Needs Fully Customizable Applications with Zone-based Captive Portals and Enhanced Advertising Location-Aware App for Personalized Experience Integrate with Business Systems

34 Cisco CMX Partner Ecosystem Americas EMEAR APJC Global Network of Technology Partners

35 Location Excellence Means Better Business Intelligence FastLocate: Critical to actionable data Cisco CleanAir Technology Detects BLE beacons, interferers and optimizes RF T=00s T=30s Cisco FastLocate Faster refresh provides more location detail Hyperlocation Provides enhanced location accuracy BLE Gateway Complete BLE management, Integrated and plugin BLE options, BLE SDK*, and BLE Analytics*

36 Hyperlocation Video

37 Customer Use Cases

38 Cisco Universal Wi-Fi and Small Cells Built on Unrivaled Expertise Most widely deployed small cells in the world Over 18 million Wi-Fi APs deployed, 55%+ share 200+ Service Providers using Cisco SP Wi-Fi Over 2 million Licensed Small Cells deployed

39 Cisco SP Wi-Fi Deployments* Cable Mobile Fixed Mobile One *Partial list over 200 deployments worldwide

40 O2 UK Target 15,000 sites across the UK O2 is realizing a cost savings from previous wholesale partnerships, marketing and brand image boosts, network offload benefits in dense areas, and joint marketing opportunity through proximity based advertising Target market hotels, bars, department stores, train stations, and football stadiums The sign up process was auto-provisioned for all O2 customers with Wi-Fi devices by the end of the 2011 with a one-time registration based on MAC address; SIM-based authentication is now in deployment We don t see Wi-Fi as trying to replace 3G, [but] there will always be physical limitations. The spectrum is limited. Wi-Fi increases your overall capacity to service demand. Gavin Franks, Head of O2 Wifi

41 O2 WiFi Video

42 Shaw Canada Shaw Communications Inc. provides consumers with broadband cable television, High-Speed Internet, Home Phone, telecommunications services, satellite direct-to-home services and engaging programming content. Shaw serves 3.4 million customers in Canada, through a reliable and extensive fibre network. Shaw opts for SP Wi-Fi buildout over LTE Goal: Extend the superior home Internet experience to the mobile world.

43 AT&T Example Architecture Cowboys Stadium Dallas Super Bowl XLV 942 indoor and outdoor APs deployed Cisco WLC architecture in NxN configuration WCS for operation for monitoring and reporting of the network Over 50,000 clients estimated in the stadium Over 6200 simultaneous clients connected on Wi-Fi at peak time 15,000 unique devices registered to the network Full 3G offload from AT&T phones using WISPr authentication With the new stadium, we've jumped to the forefront of a lot of new, emerging technologies. We wanted to have Wi-Fi throughout the stadium. We see peak loads for kickoff, halftime, and Cowboys end game periods when everyone is doing video uploads. Peter Walsh, CIO, Dallas

44 Telkom Indonesia WiFi Vision Phase 1 70,000 Access Points Hotspot services 3G/WiFi data mobility Phase 2a (Now) +100,000 Access Points Hotspot services Home WiFi Services 3G/WiFi data mobility Pay As You Install Model Senior Level Engagement Phase 2b (Planned) +2 million Access Points Hotspot services Home WiFi Services 3G/WiFi data mobility Multimedia services Consumption Model

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46 PT Telkom, Jakarta Convention Center

47 MGM Resorts International/Mobilitie Cisco Connected Mobile Experiences Concierge App Personalized guest information Indoor location services Indoor navigation Push notifications and promotions Location analytics

48 Stary Browar Video

49 Cisco Solutions - Where to go Next: Cisco Connected Analytics Cisco Support Community for Connected Analytics: Cisco.com: Cisco Mobility IQ Cisco Enterprise Mobility Services Platform MESP 49

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