Transcript Slide 1

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Introduction:
The Partnership for Lebanon
Broadband Strategy
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The commitment of the Partnership for Lebanon
5 companies, 5 workstreams, over 15 projects
www.partnershipforlebanon.org
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The Partnership Vision for Lebanon
With the most advanced communications
infrastructure of the Middle-East, Lebanon could
transform
• Education and knowledge into innovation
• Ingenuity and entrepreneurship into
sustainable growth and wealth
• Its worldwide Diaspora into a connected global
leading community
• Individualism and tradition into creative cultural
diversity and social cohesion
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OECD, UN, World Bank, WEF all recognize the
power of broadband connectivity to accelerate
economic growth and social inclusion
For social inclusion
To boost productivity
and economic growth
For government
efficiency and
effectiveness
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Education for all
Healthcare for all
Universal Connectivity
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Increase competitiveness
Attract private investment
Generate Innovation
Reduce transaction costs
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Better Services for
citizens and businesses
Cost-savings
Security, safety and
transparency
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•
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Connectivity is a need not a luxury
a)Insignificant costs compared to other
infrastructures
b)For Lebanon the most powerful lever to
leapfrog
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Table extracted from the 2006 European
Innovation Scoreboard
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Broadband subscribers per 100 inhabitants, by
technology (Source OECD, June 2007)
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OECD Broadband subscribers per 100 inhabitants, by technology, June 2007
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DSL
Cable
Fibre/LAN
Other
25
20
15
OECD average
10
5
0
Source: OECD
Source: OECD
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Government Affairs
CRL* Team
Robert Pepper
Director,
Global Policy
Corporate Affairs
George Akiki
Program Director,
Partnership 4 Leb
Salam Yamout
Program Manager,
Partnership 4 Leb
IBSG
Peter Gruetter
Distinguished
Fellow
Nicola Villa
Director,
Public Sector
Diogo Vasconcelos
Distinguished
Fellow
Chris Reberger
Manager,
Solutions Center
Consulting Engineering
Monique Morrow
Distinguished
Engineer
Russ Gyurek
Consulting
Engineer
Others
Hosein Badran
Robert Grossman (IBSG)
Paolo Campoli (Business Dev)
Selim Edde (BDM)
Mawaheb Kabbara (SE Mgr)
Michael Truskowski (CE)
* Connected Republic of Lebanon
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TRA
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Regulatory and Market
Framework
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Roles for Public and Private Sectors
in Technology Adoption
% Adoption
100%
}
}
80%
60%
40%
Closing the Gaps:
20%
Policies for Digital Inclusion
0%
Time
Government as Catalyst:
• Market stimulation
• Pre-commercial R&D
Demand
Supply
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Connectivity in Lebanon today
• Weak infrastructure
No IP NGN backbone
• Low speed
256 KBPS
(recently introduced DSL
maximum speed 2 Mbps)
• International Bandwidth
Limited
• Coverage
Limited
• Expensive service
$50 (urban, DSL)
$200 - $400 (rural, leased)
Sound regulatory framework and private investment are key
to put Lebanon on the road towards pervasive broadband connectivity
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Role for TRA
• Telecom Regulatory Authority (TRA)
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Establish regulatory framework
Issue licenses
Monitor, investigate, enforce
Alternative dispute resolution (ADR)
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Role of Council of Ministers
Council of Ministers decisions to support the regulatory
and market framework for attracting investment in
sustainable broadband infrastructure and fast deployment
in urban areas:
1. Public ownership and access to ducts for licensed
service providers
2. Unbundling of the local copper loop
3. Ducts in new buildings
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Regulatory-Market Framework
• Developed by Cisco’s “Connected Republic of Lebanon”
team in consultation with the TRA
• Based upon technical, market and regulatory analysis
• Aims at attracting investment in sustainable broadband
infrastructure for Lebanon in 2008
• Many ways to reach the goal. Philosophy of regulation:
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simple
transparent / explicit
rely on the market wherever possible
narrowly targeted regulation
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New Broadband Licenses (1)
• Core Type License
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Market could support up to three
Auction if competing applications
Coverage requirements / Nationwide service with 8 nodes
Option to construct international gateway
High level technical requirements for speed, latency, jitter, etc based on
international standards.
– 15 year license with presumption of renewal
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New Broadband Licenses (2)
• Metro/Access Type License
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Issued upon application
No limitation on number
No build out requirement for new entrants
10 year license with presumption of renewal
Technology neutral
Use or lose requirement for spectrum license
No restrictions on the applications that can be run on the network
Allows two-way satellite broadband directly to subscribers
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Interconnection Requirements
• Interconnection for Core licenses
– New core licensees have access to international gateway at fair, reasonable
rates
– Allowed to interconnect at international gateway, national nodes, IXPs
– Alternative dispute resolution at TRA if complaint
• Interconnection for Metro/Access licenses
– Metro/access license holders able to interconnect with Core networks on
commercial basis
– Interconnection of last resort with Ogero (Liban Telecom) metro/access
network
– Alternative dispute resolution at TRA if complaint
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Additional Requirements
• New fiber network investment
– No initial local loop unbundling for metro/access licensees who deploy
new fiber
– Assessment to unbundle after 10 years
• Legacy copper local network
– Unbundled on fair and reasonable terms and conditions
– TRA resolves complaints with ADR
• “Duct Management Desk”
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Guarantee equal access to ducts
Expedite and coordinate new duct construction
Establish and enforce duct standards
Maintenance and access of existing ducts
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Network Architecture
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Overall Network Architecture
• Delivers a scalable hierarchical network
• Network Components: IGW/IXC, Core, metro, access
– Core: IPNG cores
– Metro: Metro Ethernet connections
– Access: xDSL, FTTx, Wi-Max, 3G/4G, Satellite
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Architecture Details: Core
Core Details
• IP/NG core network
• Each core will have a peering point to IXC
• Eight core nodes connected via
Redundant/protected 10GE links
• High availability. Power back-up, redundant
equipment architecture, ability to support variety of
QoS parameters
• Scalable architecture for much higher data rates per
growth
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Network Architecture: Core
High Level Core Router Layout
IP/MPLS Provider Routers Only
BEI 1 and BEI-2 fully
meshed for redundancy
Internet Gateways at BEI-1
and BEI-2 also
n x 10-40 Gbps
BEI-1 and 2 Core
Aggregation
Capability
Tr ip oli
10 Gbps WAN Capabilty
BEI-2
Jou nie h
Beirut
BEI-1
Zahle
Sa ida
Na bat iyeh
8 cities
Tyre
Urban areas / Beirut Mount Lebanon
should be able to connect businesses located
here with 100MB PS on a per need basis
Metro / High density po pulation
/ Intense Economic Activity
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Architecture Details: Metro/Access
• Metro: Includes Business Parks & High Density
population areas
• Combination of rings and wireless coverage around
major cities
• IP Carrier class network
• Meet minimum BB data rate (DS and US)
• Suggested requirements:
– No service manipulation
– QoS to support Video
– Availability (limited downtime)
• Quad-play service capable
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DSL Assumptions for metro/access
3Km
300m
CO
Down: 25 – 50 Mb/s
Up: 1 – 6 Mb/s
Down: 1 – 8 Mb/s
Up: 0.384 – 1 Mb/s
Down: < 1.5 Mb/s
Up: 0.122 - 0.384 Mb/s
5Km
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Not All Bits Are Created Equal
“Speed” and Latency
High
Telepresence
Voice
Gaming
(LD)
Gaming
(HD)
Sensitive
to Latency
Streaming
Audio
Streaming
Video
HD-IPTV
Download
Video
Low
Email
Low
Bandwidth
High
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Architecture: What to Expect
In Three Years (Conservative):
• 3 competitive core networks.
• Metro business parks and MDUs in dense populated regions to
have a combination of DSL and Wi-Max coverage. Expect 40%
availability of BB
• Fiber rings around the eight large metro areas
• Rural and less populated areas beginning to have DSL
availability, potential for Wi-Max and 3G/4G. Expect 15%
availability
• Demand increasing, demand for Internet devices
• SP plans to start FTTH
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Architecture: What to Expect
In Three Years (Optimistic):
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3 competitive core networks
Multiple Metro Fiber rings in major cities
In-band Video options, SDV, PPV, etc
Metro business parks are fibered: access to 100Mbps/1GE
Downtown coverage is upwards of 50%
Metro areas have Wi-Max blast
The major Rural CO’s equiped with DSL capability
SP deploying FTTH to “Greenfield” developments
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Business Case
Broadband business case
• Positioning the business case
– Private sector outcomes without public support
– Seen as a first step to connected Lebanon and
precludes no developmental option
– Delivers NGN-IP backbones, robust connections
– Conservative bias in market forecast and player
revenues
– Macro economic model
– New entrant is an integrated player competing
nationally against 2 others
– Application revenue excluded
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Broadband business case
• Total market and new entrant characteristics
– With economic growth of 2.5% over next 10 years
– Leads to a per capita GDP of ~$US 9,500
– Competitive stimulus to the market
• 200,000 households subscribing in 2018. $US 40
month flat as speed increases (regression, check
against HH income distribution)
• 16,000 leased lines in 2018. Prices decreasing 15%
a year, going to UK levels, normalised on GDP.
– Numerous assumptions associated with churn, share
of gross adds, long term equilibriums of 1/3 in core and
access, take up curves, market sizing
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Network Model Cost Assumptions
– Architecture is based on current NG available
equipment (competitive)
– Costs are discounted to represent SP buying power
– Estimate does not include “Services” (video servers, etc)
– “Content” costs are not included
– Model includes upgrades and scalability to equipment
– Model includes maintenance expenses
– Copper lease costs are included (Access)
– Network exchange agreements are not included:
handoff, Access to Metro agreements
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Broadband business case
• Consider one vertically integrated player
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10 year cumulative CAPEX/OPEX ~ $US 360 million
10 year cumulative HH revenue ~ $US 342 million
10 year cumulative Business revenue ~$US 90 million
NPV of ~ 6 million @ 15% (No TV)
Peak debt $US 52 million
Summary
$US m
$US m
$US
$US
$US
$US
m
m
m
m
$US m
$US m
Total
Consumer/SMB broadband
Enterprise
Total
2008
5.6
0.0
5.6
2009
18.0
1.2
19.2
2010
26.9
6.0
32.8
2011
31.3
9.5
40.8
2018
39.1
7.2
46.3
Access
Metro/Aggregation
Core/Backbone
Global interconnect
Network
Total
2.5
34.7
3.7
0.8
1.2
42.9
5.3
25.6
0.9
0.8
0.6
33.2
7.4
25.3
0.0
0.8
0.4
34.0
7.1
22.9
0.0
0.8
0.3
31.1
9.4
16.1
0.0
3.1
0.2
28.9
-37.3
-13.9
-1.2
9.7
17.4
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Q&A