Cable 2020 Foundations - Author: Doug Barney - TMCnet

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Cable 2020 Foundations - Author: Doug Barney - TMCnet
Cable 2020 Foundations

                                                            Author: Doug Barney

 Alcatel-Lucent joins Nokia following successful exchange of shares. Find out more
Cable 2020 Foundations - Author: Doug Barney - TMCnet
Table of Contents
    Introduction............................................................................................................................. 3

    Chapter 1: Leveraging Your Wi-Fi Assets................................................................................. 6

    Chapter 2: Realities of Virtualization......................................................................................... 9

    Chapter 3: Experience is Everything...................................................................................... 18

    Chapter 4: Getting Your Network Fit For Cable 2020............................................................. 29

    Related Content.................................................................................................................... 43

    With the combined strengths of Nokia and Alcatel-Lucent, we are an innovation leader in the
    technologies that connect people and things. Together, we have the capabilities and global
    scale to meet the extraordinary demands and opportunities of a world where everyone and
    everything are increasingly connected. We’re creating a new type of network that’s intelligent,
    efficient, and secure, and advancing the technologies that tap its power through smart devices
    and sensors.

eBook - Cable 2020 Foundations                                                                                                               Page 2
Cable 2020 Foundations - Author: Doug Barney - TMCnet
Introduction
A Changing Landscape for Cable Operators
By Steve Davidson, Cable MSO Strategic Marketing, Alcatel-Lucent

“Change is the law of life. And those who look only to the past or present are certain to miss the future” –
J.F. Kennedy

This couldn’t be more true for MSOs, who have made a healthy living for the past couple of decades
based around the control of the home via content subscription packages and the television set.

TV consumption is changing. Time spent watching traditional TV is steadily declining, whilst on-demand
takes hold fast with OTT companies such as Netflix streaming huge amounts of SVOD content.
As operators adjust, new bundles and options start to appear. Of particular interest is the younger
demographic (
Cable 2020 Foundations - Author: Doug Barney - TMCnet
This is increasingly important for MSOs as other operators (or anyone with a fiber network) are rapidly
improving reach and bandwidth capabilities with FTTX and G.fast technologies. MSOs will not be able to
easily maintain their broadband leadership against encroaching FTTX and it is now common practice in
MSOs to also look to deploy fiber for greenfield extensions in preparation for cable 2020 and beyond.

In terms of mobile data, MSOs have already invested in Wi-Fi® and now look to scale and monetize
this technology further, making “Wi-Fi First” a hot cable industry voice and data discussion topic. Wi-Fi
usage accounts for a very high percentage of mobile data consumption, mainly centered around the
home environment (40%) and then nomadically in public areas (20%) and venues (20%) for example.
Connectivity on the move and in-between the aforementioned is achieved via cellular (20%).

MSOs realize that subscribers require always on mobile connectivity, and that mobility is a required
compliment to fixed services and affects loyalty. Mobile enabled MSOs will notice an important difference
in churn levels of their quad play subscribers versus other customers.

As Wi-Fi usage ramps up, there is an increased focus on capabilities to manage voice and data
connectivity between Wi-Fi and cellular. Also issues related to the quality of home Wi-Fi connections,
which can affect – amongst other things – the video streaming experience and hence the MSO brand.

In the residential space, a plethora of connectivity, online content, advertising, and consumer product
companies are vying for consumer attention. New types of differentiators and revenue sources are
required.

“You must be the change you wish to see in the world” – Mahatma Gandhi

In the search for new revenues and customer retention tactics, other industry trends are being
considered by MSOs. The Internet of Things is a hot topic across the industry that could become
a lucrative focus area for MSOs once standards are in place and clear business models can be
established. Business insights and big data collection is another area that MSOs can benefit from in the
same way as large OTT providers are doing today – with personalized offers and discovery, proactive
service assurance, etc.

B2B is another new revenue candidate. Enterprise spending increases and new ways of working,
especially for the small to medium segments, creates a window of opportunity for MSOs with new
offers centered around fixed and mobile connectivity bundles enhanced with services and enterprise
applications. MSOs may leverage virtualization technologies to create differentiated offers that align with
enterprise customer needs.

“Intelligence is the ability to adapt to change” – Stephen Hawking

As MSOs strive to maintain their lead, as they adapt and grow within this environment, imperatives
such as “build quality into everything we do”, “enable my network for business in 2020”, and “grasp
opportunity and create new revenue streams” become increasingly important.

eBook - Cable 2020 Foundations                                                                       Page 4
Cable 2020 Foundations - Author: Doug Barney - TMCnet
This also implies an enhanced focus on key projects, each bringing with them their particular set of
challenges such as:

       •   Evolving the video offer and delivery capabilities. This requires being prepared for new
           content, new formats and devices, new IP delivery models, new consumption models and
           unpredictable scale.
       •   Evolving cable access and transport networks for Gigabit service delivery. Having the right
           technology investments in place to ensure the gigabit home and enhanced business services
           become a reality.
       •   Delivering quality wireless/mobile services. Having the correct tools in place and core
           capabilities to ensure brand worthy home Wi-Fi experiences and hybrid wireless access
           connectivity.
       •   Grasping growth opportunities in commercial services (e.g., SMB, enterprise). Building
           capabilities at cloud speed to appeal to the enterprise new way of working.
       •   Improving operations and customer experience. Includes focus improvements in Net Promoter
           Score (NPS) /customer satisfaction, creating the capability to drive service agility as well as
           OPEX reduction via simplification and consolidation of operations.

In this e-book, we’ve gathered a series of short articles on key MSO focus areas. These topics will help
build the foundation for cable 2020 and a continued leadership role for MSOs in the new era of info-
entertainment and connectivity.

eBook - Cable 2020 Foundations                                                                     Page 5
Cable 2020 Foundations - Author: Doug Barney - TMCnet
Chapter 1: Leveraging Your Wi-Fi Assets
Cable MSO Have an Advantage with
Wi-Fi First – For Now
By Mae Kowalke, TMCnet Contributor

If you haven’t noticed, Wi-Fi is overtaking cellular as the primary wireless data connection.

Wi-Fi surpassed cellular as the primary carrier of wireless traffic in 2014, according to Alcatel-Lucent,
and it is expected to carry more than half of all wireless traffic within the next two years.

This is because of video largely. Roughly 55 percent of smartphone owners and 61 percent of tablet
owners use TV apps on their devices at least once per month, according to Parks Associates. Wi-Fi
is the better choice for such high-bandwidth content, and overall there are roughly 10 billion devices
worldwide that connect via Wi-Fi.

This presents opportunities for cable MSOs. As noted in an Alcatel-Lucent strategic white paper, Multiple
System Operator (MSO) Wi-Fi: Solutions to enhance the connected lifestyle, cable operators have the
opportunity to be first-movers in the global migration to Wi-Fi First if they move fast, given their Wi-Fi
infrastructure.

“Originally, MSOs positioned their residential Wi-Fi devices as conduits just for connecting devices to the
Internet,” noted a TechZine posting by Nicholas Cadwgan, Marketing, Alcatel-Lucent titled, Cable MSO
Wi-Fi enhances customer lifestyles. “But now Wi-Fi has become the primary home networking medium.”

In many cases cable MSO’s residential Wi-Fi gateway also is serving as a hotspot for public access in
community Wi-Fi applications.

This is important, because community Wi-Fi can help cable MSOs lead the way in the emerging voice-
over-Wi-Fi (VoWi-Fi) trend where calls and rich communications services seamlessly work across both
cellular and Wi-Fi connections.

“The emergence of VoWi-Fi technology gives MSOs another opportunity to use their residential APs
to deliver a comprehensive package of advanced rich service experiences to their subscribers,” noted
Cadwgan. “By launching a VoWi-Fi service that leverages their deployed Wi-Fi infrastructures, MSOs can
allow consumers to choose Wi-Fi as their primary option for voice calls, as well as all other data, video,
and multimedia services.”

Cable MSOs have little time to waste, however; cellular carriers have spotted the trend, and 18 of the top
20 cellular carriers worldwide now have publicly committed to deploying Wi-Fi hotspots for VoWi-Fi and
things like improved mobile video experience.

eBook - Cable 2020 Foundations                                                                        Page 6
Cable 2020 Foundations - Author: Doug Barney - TMCnet
Full integration of small cells with hotspots has yet to be achieved by cellular carriers, but that is coming
soon.

So now is the time for cable MSOs to grab the first-mover advantage when it comes to Wi-Fi. The
competition is advancing fast.

Cable MSOs Can Benefit from Wi-Fi First Trend
By Mae Kowalke, TMCnet Contributor

Cable multiple service operators have an opportunity in the Wi-Fi First trend.

In the previous article we looked at the emergence of voice-over-Wi-Fi and why it holds out so much
promise in general. Attention is now turned to the strategy of maximizing the opportunity. Focus is
on In particular, converged cable MSOs that have been acquired by or that have acquired a MNO
and MSOs that offer mobility service bundles. These extend standard fixl6ed services for content and
communications through a full mobile virtual network operator (F-MVNO) who are in the best position to
benefit from Wi-Fi First, according to a recent Alcatel-Lucent article by Steve Davidson, Cable MSO Wi-Fi
First offers unique opportunity.

“A Wi-Fi First strategy can incrementally benefit MSOs that have access to both Wi-Fi and cellular
assets, noted Davidson on the article. “With these assets, they can provide wireless broadband service
based on an unlicensed/licensed mobility scheme built on Wi-Fi, and LTE, or 3G.”

A Wi-Fi First strategy enabled MSOs to keep customers connected while reaping substantial benefits.
Alcatel-Lucent has found that up to 65 percent of voice calls on an F-MVNO enabled MSO network are
made in the home environment alone, according to Davidson, and indoor coverage by macro cells often
is an issue due to building insulation and the move from 900 MHz 2G to 2100 MHz 3G and 2600 and
1800 MHz LTE.

MSOs can direct mobile data and voice traffic to and from the cellular radio access networks to their
Wi-Fi radio access networks to optimize capital spend on access networks and lower the total cost of
ownership. They also can optimize the costs relating to cellular connectivity by what is known as Wi-Fi
offload.

“Bell Labs Consulting indicates that MSOs can glean significant savings from data steering alone,” noted
Davidson.

Wi-Fi calling in some cases also can provide reduced setup times compared with 2G/3G circuit-switched
voice, and MSOs can gain substantive savings on national roaming provider costs and international
roaming costs through Wi-Fi First.

eBook - Cable 2020 Foundations                                                                         Page 7
Cable 2020 Foundations - Author: Doug Barney - TMCnet
“They can enable video call steering from cellular to Wi-Fi access, which saves capacity in their
cellular networks,” said Davidson. “They can deliver HD audio and they can offer enhanced presence
applications.”

Wi-Fi First mobile connections are going mainstream, and MSOs are in a good position to take
advantage of the trend. In our last posting more details on why there is some urgency in moving first as
well as fast will be explored.

eBook - Cable 2020 Foundations                                                                    Page 8
Cable 2020 Foundations - Author: Doug Barney - TMCnet
Chapter 2: Realities of Virtualization
Network-Wide NFV Use Gives the Advantage to
Cable MSOs
By Mae Kowalke, TMCnet Contributor

 Multiple service cable operators are in a strong market position thanks to their fiber and wireless
infrastructures that can be put to good use delivering high-speed broadband services, as we noted in a
TMCnet article.

Here we look at how fully taking advantage of this infrastructure requires network functions virtualization
(NFV). The reasons are put forth in a recent white paper by Alcatel-Lucent, The cable cloud mandate:
The essential role of network functions virtualization in cable, which highlights why and how, “the cable
NFV advantage greatly depends on operators’ ability to execute a vast range of functions at the edge.”

A virtualized flexible cable edge offers three advantages for MSOs: It minimizes the space and power
consumed by equipment, it enables operators to handle the complexities of managing an ever-
expanding array of services on a personalized basis across an ever-expanding array of devices, and
it puts these processes in sufficiently close proximity to achieve the extremely low latency thresholds
essential to sustaining the highest levels of performance on virtualized CPE.

Understanding this, Alcatel-Lucent has developed a cable NFV framework that MSOs can use for a
flexible edge.

The Alcatel-Lucent Virtual Service Router (VSR) software suite plays a fundamental role in bringing
NFV to the cable edge. VSR, introduced in 2014, provides operators a way to eliminate the need for
dedicated routers for each type of service and distribution facility by shifting routing functions to the
Alcatel-Lucent 7750 Service Router, thereby separating the service layer from the access technology.

“By eliminating multiple IP aggregation layers, operators can deliver residential, commercial, wireless and
network services with service awareness and differentiation over any access medium, including DOCSIS,
PON, direct fiber, and carrier Wi-Fi,” noted the white paper.

A second innovation that helps MSOs is the Virtual Residential Gateway (vRGW) capability, which lets
the virtualized cable edge support virtualization of the residential gateway functions within the cable
edge. An initial application for this is residential Wi-Fi.

The Alcatel-Lucent solution also provides cable operators the back-office tools essential to executing
operations, such as data aggregation and advanced analytics capabilities that enable operators to
ensure that every function in the virtualized environment is performing as needed. It is a NFV-optimized

eBook - Cable 2020 Foundations                                                                       Page 9
Cable 2020 Foundations - Author: Doug Barney - TMCnet
subset of Alcatel-Lucent’s Motive Customer Experience Management (CEM) platform, and comprises a
modularized, fully automated and programmable operations support system (OSS) that can be employed
to dynamically identify and track network resources, fulfill orders, assure services, and facilitate self-
healing with automated recovery, predictive management and other processes.

Cable operators may have a leg up, but they need the right technology in place to take advantage of
their infrastructure strength.

The Case For a Virtualized Residential Gateway
By Enrique Hernandez-Valencia, Consulting Director, Bell Labs, Alcatel-Lucent
Arnold Jansen, Senior Product Marketing Manager, Alcatel-Lucent
Luc Ongena, Senior Consultant, Bell Labs Consulting
Thomas Weishaeupl, Senior Expert, Bell Labs Consulting

A virtualized residential gateway (vRGW) moves some functions that are currently deployed on the
residential gateway into the network cloud, along with centralized management and control. This lets
service providers introduce a more simplified bridged residential gateway (BRG) with home device
management functionalities and per-device service assurance and control capabilities.

Consumers can use home device management to manage service usage, QoS, and security policies
for each of their connected home devices. Most importantly for service providers, a study by Bell
Labs estimates that network operating cost savings of 20-40% can be realized on service assurance,
fulfillment, and lifecycle management, depending on market conditions.

In combination with additional savings on subscriber acquisition cost, total cost savings can amount to a
profit margin improvement of 10-29%.

Making it simple the smart way

If you have become so complex that traditional implementations impede service velocity and agility, you’ll
also have a residential gateway. It’s the little plastic box with blinking lights that connects your PC and
home network to your Internet service provider’s network.

Although it may seem unassuming and cheap, the residential gateway is a demarcation device that plays
an important role in delivering the service. It represents a large slice of service fulfillment, assurance, and
lifecycle management costs. It packs a ton of features and likely required a technician to come to your
house to install it. And if it doesn’t work properly or you want to upgrade to higher access speeds or
more service features, it will most likely require another visit to fix or replace it.

Cloud-based applications and rich media content drive an increasing demand for access speeds of 100
Mbps and up. A plethora of user devices and gadgets are being connected in the digital home network,
and the transition to IPv6 is well underway.

eBook - Cable 2020 Foundations                                                                        Page 10
As a result, in-home residential gateways have become so complex that traditional implementations
impede service velocity and agility. Service providers must juggle an increasing number of hardware
makes, models, and versions and struggle to maintain a consistent and customer friendly service
experience. Costs and complexity is increasing while subscriber growth is stagnating, and average
revenue per user is declining steadily.

                                  Figure 1. Virtualized residential gateway

When we move functions like IP routing, NAT, firewall, and DHCP into the network cloud (Figure 1), it
doesn’t remove the need for a residential gateway device at the customer premises. But it becomes
simpler and easier to operate, maintain, and troubleshoot services.

Good for customers and great for business

A simpler residential gateway at the customer premises has far reaching consequences on operational
complexity, cost, and profitability. As stated previously, Bell Labs estimates up to 40% on operating cost
savings. Here’s the breakdown of these savings per cost category:

Service fulfillment: 7-12% cost reduction
Truck rolls can easily represent over 80% of service fulfillment cost.

       •   A simpler residential gateway and extended auto-installation capabilities lead to faster end
           point turn-ups and fewer truck rolls to address service activation issues.
       •   Leveraging network-based service capabilities leads to faster rollout and turn up of new
           service features and fewer truck rolls to address service upgrade requirements.

Service assurance: 63-67% cost reduction
Service provider data shows that 30-40% of trouble tickets are related to network layer 3-7 issues.
These can be resolved better by leveraging a centralized vRGW platform in combination with home
device management capabilities.

eBook - Cable 2020 Foundations                                                                    Page 11
•   The vRGW model results in a simpler physical RGW at the customer premises. This results
           in fewer issues related to the RGW itself, an increased success rate of first support calls, and
           fewer truck rolls to resolve RGW issues.
       •   Superior analytics reduces the number of customer support calls since more issues can be
           resolved prior to a customer complaint. There are fewer incidents requiring human intervention
           and a positive customer experience.

Life cycle management: ~66% cost reduction
Although life cycle management costs are relatively small compared to fulfillment and assurance costs,
enhanced service velocity and agility improve service innovation, time to market, and revenue.

       •   Device management costs are lower. The vRGW model reduces the number of physical RGW
           variants that need to be maintained and stocked, since a subset of functional requirements is
           moved into the network.
       •   New service features can now be introduced in a centralized manner through vRGW feature
           upgrades. This reduces pre-deployment tests required and enables a fast and consistent
           introduction of new service features.

Table 1 shows the key performance indicators that are improved by virtualizing the residential gateway.

                      Table 1. Improving KPIs with a virtualized residential gateway

A combination of an improved customer experience and better lifecycle management offers measurable
improvements in customer loyalty and time-to-revenue for service deployment. Customers stay longer
with their current contract, are less inclined to switch providers, and less effort is required to retain
existing or acquire new customers.

As a result, service providers can enjoy additional savings of 12-37% on sales and marketing cost, in
combination with improved time-to-revenue and revenue retention.

eBook - Cable 2020 Foundations                                                                    Page 12
Besides operating cost savings that contribute to the bottom line, a virtualized residential gateway
delivers measurable structural process improvements in customer experience, service delivery, and
assurance. This facilitates a more innovative, agile, and responsive organization that is better equipped
for success as market conditions evolve.

MSO toolkit: Moving to Virtualized Functions
By Steve Davidson, Cable MSO strategic marketing, Alcatel-Lucent

Like other operators, cable MSOs need to consider virtualized functions and new architectures for B2B
services to succeed in the cloud era. These are elements of the toolkit we introduced in a TechZine
article. It’s a toolkit of concepts and technologies to help the MSO network adapt to new requirements
and become more programmable. And in this article, we’ll look at real-world examples.

THE MOVE TO VIRTUALIZED FUNCTIONS

The industry has invested quite a lot of effort in network functions virtualization (NFV). What began
as a concept – can we virtualize a network function? – is now a reality. We have really taken a lot of
the functionality that would have typically been delivered on a specialized hardware box (a router, for
example) and virtualized them.

                                      Figure 2. Virtualizing hardware

Equipment vendors have begun this process, and in some cases functions are implemented and ready
to be purchased and installed. The virtual route reflector is a great example. This is largely a control
plane technology, so it makes a lot of sense to run that on a server and we get a big performance gain in
doing so, utilizing the additional cores and capacity that you get on a dedicated server platform. But not
everything needs to be virtualized.

eBook - Cable 2020 Foundations                                                                     Page 13
The industry’s trying to figure out which functions actually perform better on a server versus running on
specialized hardware. Think about this. We have virtualized things, put them on servers, and already
have customers saying “Hey you know, for some of these functions, it would be really nice if we could
get some specialized hardware running in these servers to accelerate these functions”. But if we take a
virtualized function, say a virtualized routing function, and put it on specialized hardware – what you have
effectively done is once again created a router.

In reality we have a continuum in terms of the hardware upon which we want to run these different
network functions. It really depends upon the network function itself, what you are trying to do, to be
able to select the right target hardware platform.

A HARDWARE CONTINUUM

On one end of the hardware continuum would be something like a hard coded merchant silicon based
system. Datacenter switches are a great example of this. They are really designed to move a specific
type of packet with specific headers and do that at very high scale and very low cost, with very minimal
feature sets.

On the other end of the continuum, where we typically talk about NFV, are general purpose processors
running network functions that are virtualized. You get a lot of flexibility and can run a lot of different
things in that environment. You can do very complex packet processing tasks, though you will ultimately
sacrifice performance. You are running on a processing platform that isn’t optimized for that specific
function, so there is a performance trade off.

In the middle of the continuum are other types of specialized hardware. These could be network
processor based systems, like the kind we use to build routers, all based on network processor families.
What the network processor really gives you is the best of both worlds.

It’s like having a general purpose processor system that has been optimized for the specific task of
forwarding packets – doing packet look-ups, incrementing counters, all the memory transactions that
go with that. Network processors are designed to do that in a flexible way. It’s actually running software.
There is microcode running inside that processor, so you can add features to enhance the system over
time.

We all will continue to work with this continuum, as there is no one size that fits all. There’s a wide variety
of hardware infrastructures that meet the various needs of these applications and functions and that’s
how operators are evolving their networks.

Branching out with SDN

Along with virtualized functions, software defined networking (SDN) helps operators address future
network requirements. One example of an opportunity is in the enterprise VPN services market.

eBook - Cable 2020 Foundations                                                                        Page 14
In today’s market, the vast majority of VPNs are still based on MPLS technology. Enterprises in general,
but especially high end enterprises, typically look to purchase MPLS VPNs. There are good reasons for
this, such as very high SLAs. And they can carry different types of traffic with differing QoS levels highly
efficiently across multiple sites.

But within the enterprise environment we are starting to see some of the trends we already discussed –
lots more video traffic, more bandwidth requests. Whether their employees are watching entertainment
videos during their lunch hour or training videos as part of their job functions, the result is a huge
increase in traffic. And a lot of this being driven from the internet.

At this point, in the search for a cost effective solution, enterprises begin looking at over-the-top or do-
it-yourself VPNs. They might buy a broadband pipe and begin to run their own VPNs on top of that by
pinning up some secure IPSec tunnels.

                       Figure 3. The enterprise VPN market: Current state of affairs

This is really challenging the MPLS VPN market. We see it as a great opportunity, particularly for MSOs,
since most cable operators have never rolled out Layer 3 MPLS VPNs, an area dominated by incumbent
telcos. An SDN based VPN is a great alternative to do-it-yourself VPNs and will be an attractive product
offer for MSOs.

OPTIONS FOR VPN CONNECTIVITY

Let’s look at how we can apply SDN and NFV technology to address this market need for higher scale,
higher capacity VPN connectivity services. There is not a 1 size fits all strategy, but following are 3
alternatives that we frequently discuss with our customers.

eBook - Cable 2020 Foundations                                                                       Page 15
1. Move and virtualize CPE functionality

The 1st idea is to move the CPE functionality out of the physical box at the customer site, virtualize it,
and run it in servers in the cloud or in a data center.

                                      Figure 4. Move CPE functionality

This is nice, if you can keep the CPE in place and start tunneling at Layer 2 to get all of the services and
functionality implemented back in the cloud.

The real drivers for this are simplification from an operations perspective on what goes out in the branch,
and you can now instantiate all the services including value added services from within the cloud. As you
are tunneling the traffic you can also potentially run that over an internet connection as well as an MPLS
helping to achieve scale. This concept is similar to that currently being contemplated for virtual residential
gateways.

2. Virtualize functionality at the customer premises

With an inverse approach, we know we can virtualize functions, run them in a VM, and drop it into some
general purpose compute. We therefore can put a box in the customer premises that is effectively an
extension of the NFV infrastructure that is managed and run by the MSO.

                                 Figure 5. Virtualize at customer premises

So we have the ability to deploy the same CPE virtualized functions, but now it’s packaged in software
that we are dropping onto a device that’s part of the cloud infrastructure but located at the customer
site.

eBook - Cable 2020 Foundations                                                                       Page 16
At the end of the day the 1st 2 approaches are essentially the same – it’s just a question of where you
are implementing the functionality.

3. Move to virtualized network services

The 3rd approach is to rethink how the service is constructed. Since SDN and NFV technologies are
really concepts, we have to think about how we apply these concepts.

                                  Figure 6. Virtualized network services

In this model, we are splitting the CPE function apart. We’re running the control function from within the
MSO cloud, but we want to do the forwarding out of the customer premises. This lets us instantiate
security there and we can set up the secure tunnels, but all the policy and value added services are
managed from the central location. So we get the rapid service provisioning that comes with software
but get to do some of the functionality out of the customer site.

We call this approach Virtualized Network Services and believe it makes a lot of sense. Furthermore, this
runs inherently over any IP pipe – your own broadband service or a 3rd party broadband service.

As the industry moves into the cloud era, amidst all the apparent complexities and confusion of
virtualization, programmability, and network evolution, there are plenty of opportunities. Cable operators
can incorporate virtualized functions, consider the hardware continuum, and leverage SDN to unlock the
true potential of their broadband infrastructure.

eBook - Cable 2020 Foundations                                                                    Page 17
Chapter 3: Experience is Everything
Cable MSO Transform the Customer Experience
By Nicholas Cadwgan, marketing, Alcatel-Lucent

Success for cable operators will depend on how well they can transform the customer experience (CX)
as they strive to deliver new services to residential and commercial markets.

Cable operators can improve customer satisfaction by addressing back-office, device management, and
service assurance requirements that contribute to a far better experience for customers. The boost in
customer satisfaction will help stem losses in pay TV subscribers to create a more positive outlook on
Wall Street and in boardrooms.

Fundamental to CX transformation, is cable operators’ ability to implement a customer experience
management (CEM) platform that delivers the intelligence, scope, and efficiency to manage and optimize
today’s CX.

Keeping up with CX requirements

As operators execute on new opportunities, including TV Everywhere (TVE), MSO Wi-Fi, smart home
(the Internet of Things), and managed commercial services, they must evolve from old, siloed service
management and customer care approaches to keep up with CX requirements.

Combined with the growing use of cloud-based resources, operators’ responsibilities for maintaining
customer satisfaction have expanded to a broader range of devices, network elements and service
categories than ever before.

Today’s market conditions dictate a comprehensive, holistic approach to ensuring superior customer
experience and accelerating service velocity across multiple departments.

It’s not enough for operators to compile, analyze and format data across all service categories to provide
customer service representatives and support personnel instant access to all information relevant to any
issue. To drive go-to-market efficiencies and improve performance throughout the organization, they
must be able to extend the benefits of:

       •   Advanced user awareness
       •   Device management
       •   Actionable analytics
       •   Dynamic automated operations

eBook - Cable 2020 Foundations                                                                    Page 18
Customer satisfaction: Room for improvement

According to recent research by the Temkin Group, the American Customer Satisfaction Index, and JD
Power, there is much room for customer satisfaction improvement among Internet and pay TV providers.

For example, Temkin Group’s Q3 2014 survey of 10,000 US consumers’ opinions about goods and
services supplied by 283 companies across 20 industries registered the lowest ranking average Net
Promoter Score (NPS) for pay TV providers[1].

The average score for Internet service providers was just one rung higher in the 19th position. (An NPS
reflects a respondent’s willingness to recommend a provider of goods and services to other people
based on a scale of 1 to 10.)

Emerging services and opportunity

Customer satisfaction surveys underscore the immediacy of the cable CEM opportunity. However the full
scope of what needs to be done is best understood in the context of the changes in emerging service
offerings, including:

       •   TV Everywhere
       •   Ubiquitous Wi-Fi access
       •   The Internet of Things (smart home)
       •   Managed commercial services

TV Everywhere (TVE)
The anticipated CX impact from new initiatives is most evident in implementations of TVE services. In
TVE, consumer engagement and a seamless, high-quality experience are significant issues. Much of
the reason for the lack of engagement comes back to CX. Research highlights everything from time-
consuming sign-in processes and poor performance to viewing delays as reasons for lack of user
engagement.

Ubiquitous MSO Wi-Fi access
To capitalize on the Wi-Fi potential, operators must enhance CEM to address new complexities in service
assurance and customer service. This includes making sure everything from bandwidth and device
management to providing confirmation that authentication systems, personalized apps, ad placements,
and e-commerce commitments to commercial partners are working as expected.

The Internet of Things (IoT)
Looking beyond the expanding TV service domain, the CEM challenge becomes even greater with the
onset of next-generation smart home services. In this space, the connectivity of appliances and devices
of every description will dictate a highly versatile approach to meeting consumer expectations.

eBook - Cable 2020 Foundations                                                                   Page 19
Recent research underscores the IoT service opportunity for cable and other network service providers.
ABI Research, for example, predicts that nearly 30 percent of North American households will have a
managed smart home automation system installed by 2019[2].

Commercial services
Cable operators are transitioning from delivering commercial-grade high-speed data and voice services
at the low end of the SMB spectrum to offering more sophisticated managed services to larger
companies.

To be successful in this market, operators must be able to dynamically deliver the set of services and
functionalities with new levels of automation that each customer requires in terms of:

       •   Provisioning
       •   Service activation
       •   Performance assurance
       •   Care management

The challenge will also be delivering these functionalities in conjunction with diverse needs across
multiple customer locations.

Moving to the cloud

Virtualization of multiple processes running on data center hardware will enable accelerated service
velocity. This will allow operators to move ever more functionalities in consumer and commercial services
to the cloud.

As they do, they must be able to seamlessly incorporate the monitoring and analysis of those cloud-
based processes into their frameworks.

4 fundamentals of a comprehensive CX program

As technology innovations drive shifts in consumer behavior and open new service opportunities,
operators must start eliminating pain points. This includes any obstacles that will impede their ability to
launch and provide adequate care and quality assurance for those services. In a market crowded with
competitors, the difference between success and failure may come down to who can provide the best
and most differentiated customer experience.

1. Connected home and device management
If cable operators want to realize the goals of a next-generation CX program, they need an entirely new
way of bringing full-fledged device management into the new service domain. This means operators
must have comprehensive control of and visibility into every device and every service delivered to those
devices from their networks.

eBook - Cable 2020 Foundations                                                                       Page 20
Recent advances in device management, embodied in the Broadband Forum’s TR-069 standard and
its extensions, have been embedded into the cable customer premises equipment (CPE), including
residential and commercial gateways.

In addition, by leveraging the proxy management capabilities of TR-069-enabled CPE, monitoring and
management functionalities are available for any devices that are connected to these gateways over
standardized protocols on wireless and fixed line networks.

2. Better customer service performance
Customer care and service assurance are frequently inadequate to subscribers’ needs. At the most
basic level, long delays in answering calls in help centers often lead to abandoned call rates several
times greater than the industry best-practices average.

Once calls are answered, the time it takes for customer service representatives (CSRs) to get answers
to questions — if CSRs able to find answers at all — increases customer dissatisfaction as well as cost-
per-call averages.

A CEM program designed to address these issues requires implementation of mechanisms and
procedures that allow operators to more quickly resolve subscriber issues through all care touch points,
including:

       •   Help desks
       •   Interactive voice response (IVR) systems
       •   Self-help portals

To provide CSRs all the information they need to reduce resolution time, the new CEM platform must
have powerful analytics capabilities in conjunction with data-gathering that reaches across all devices
and systems.

The platform must also address delays in service activation, compounded by the introduction of ever
more services. When taking new service orders, CSRs must have a single-interface access to all of the
provisioning and billing triggers associated with all services and special offers. They must also be able to
confirm the service is activated as required once the order is taken.

3. Accelerating marketing strategies
As operators overcome these limitations from the help-desk perspective, they must also be able to
extend the benefits of rapid service activation and performance awareness to other departments.

Marketing personnel, for example, must quickly activate new tiers, usage-based pricing and packaging
models, free trial and reduced-price incentives, and value-added applications. And they must be able to
tap the data resources to track the performance not only of new services but also new pricing models
and incentive offers.

eBook - Cable 2020 Foundations                                                                      Page 21
4. Network consolidation and multi-access modes
Consolidation of operations at regional and national levels has created a pressing need for an integrated
multi-service management capability. This allows engineering departments to immediately gauge how
new technology strategies are impacting service performance in all locations on all devices.

Analytics systems must be able to track and identify issues based on a comprehensive set of information
relevant to whatever access link a particular user is on. Without requiring CSRs and technicians to go to
different dashboards dedicated to each type of access link.

As with all other aspects of the CX system, the platform must be able to aggregate and present all
relevant information from a user-centric, as opposed to technology-centric, point of view.

Ready to transform the customer experience

A CEM platform that fulfills these fundamentals will sustain customer satisfaction and optimize the
customer experience well into the future.

Alcatel-Lucent’s Motive Customer Experience Management Platform (Motive CEM) provides cable
operators all essential CEM program support. Motive CEM fully engages all stakeholders in the planning,
development, delivery, assurance, and customer care and support for all services across all devices and
network access points.

Footnote

   [1]
         Temkin Group, Net Promoter Score Benchmark Study, October 2014

   [2]
         TABI Research, Smart Home, STB & Home Networks Market, June 2014

Delivering a Quality Cable MSO Wi-Fi Experience
By Nicholas Cadwgan, marketing, Alcatel-Lucent

Cable MSO Wi-Fi technology has emerged as a key component of a cable MSO operator’s business
vision. It gives them the technology and solutions they need to start implementing their wireless
broadband strategies.

As noted in TechZine, deployed residential Wi-Fi APs let cable MSOs move 1st in the shift to a Wi-Fi
First broadband experience (see Cable MSO Wi-Fi enhances customer lifestyles). And as 1st movers,
they can capitalize on an emerging industry trend and create new business opportunities and revenue
streams (see Cable MSO Wi-Fi First offers unique opportunity).

eBook - Cable 2020 Foundations                                                                    Page 22
Network assets enable 1st mover advantage

In addition to their deployed residential APs, some cable MSOs already have a variety of Wi-Fi hotspot
deployments that provide:

       •   Hotspot urban coverage
       •   Public venue coverage for large public spaces such as stadiums or stations
       •   Community Wi-Fi coverage based on the extension of residential APs with a second service
           set identifier, otherwise known as a home spot

And some MSOs have also invested in, or have access to, cellular spectrum that lets them extend
advanced broadband services outside of their network footprint.

Deliver service efficiently

To leverage these assets and reinforce their MSO Wi-Fi strategy, cable MSOs must meet several
requirements in the home and beyond.

Obviously, service is important. To succeed with a MSO Wi-Fi strategy, cable MSOs must scale their
portfolios of residential and commercial advanced broadband services to ensure ubiquitous availability
across all service areas.

Providing service that meets user expectations requires a high level of performance. This can only
be achieved through end-to-end analytics insight, control and management of the service to the end
devices.

Enable a high quality experience

Beyond the technical capabilities of the network, an MSO Wi-Fi strategy must also deliver an optimal
user experience. To do that, cable MSOs need the ability to:

       •   Streamline provisioning and activation across all networks and all Wi-Fi connections
       •   Enable a fully integrated voice over Wi-Fi (VoWi-Fi) experience with the means to dynamically
           provision feature enhancements on a per-user basis
       •   Personalize all services dynamically to maximize ease of use, discovery, feature
           enhancements, and monetization opportunities per-session and device
       •   Provide superior customer service for ordering, trouble resolution, and upsell initiatives through
           customer service representatives and self-help portals

eBook - Cable 2020 Foundations                                                                      Page 23
Manage and optimize the home environment

Given cable MSOs’ history, a likely insertion point for an MSO Wi-Fi strategy is around the home where
Wi-Fi usage is most intense. This is where cable MSOs have an incentive to deliver more services, higher
network performance, and robust VoWi-Fi capabilities. It’s also the best place to provide accelerated
service provisioning, more efficient customer care, and a better customer experience.

But in today’s connected home, advanced broadband services combine with a multitude of Internet-
ready devices to create a challenging environment for both cable MSOs and consumers to manage.
Fortunately, comprehensive MSO Wi-Fi solutions are available that address both service and experience
requirements.

The most effective options provide the information needed to:

       •   Tailor services and features to each user’s unique needs and interests
       •   Quickly identify problems
       •   Trigger actions to resolve those problems

These solutions can provide direct control over every device. They aggregate all the data needed to
maintain awareness of session performance and user behavior. And they offer advanced analytics that
can be leveraged to deliver new levels of customer care and a more personalized experience in a multi-
device environment.

With the right MSO Wi-Fi solution, cable MSOs can help manage the home environment. They can
deliver a high-quality customer experience that inspires loyalty, generates up-sell opportunities, and
attracts new customers.

Virtualize the residential gateway

A new residential service delivery architecture is also needed to accelerate time to market with new
advanced broadband services and enable operational efficiencies. Network Functions Virtualization (NFV)
techniques provide cable MSOs with an opportunity to create that architecture.

By leveraging NFV solutions, cable MSOs can migrate to a dynamic, orchestrated and distributed cloud
architecture that provides significant benefits around service innovation and time to market. They can
achieve new operational efficiencies. And they can reduce the total cost of ownership of their networks.

MSO Wi-Fi scalability

Virtualization also makes it more cost-effective for cable MSOs to extend Wi-Fi capabilities across all
points of connection, both within and outside their networks.

eBook - Cable 2020 Foundations                                                                     Page 24
Solutions are available that allow cable MSOs to do this and scale to deliver highly personalized
advanced broadband services across millions of APs inside and outside homes, offices and public
venues. The best solutions allow cable MSOs to dynamically manage these services as users move from
one device and one location to the next or where required between Wi-Fi and cellular networks.

To make this possible, an MSO Wi-Fi solution needs to allow cable MSOs to extend their advanced
service capabilities in a highly scalable common operations model across all their access networks,
including hybrid fiber coax networks, passive optical networks, and switched fiber links. Therefore MSO
Wi-Fi solutions must support a number of tunneling protocols that connect Wi-Fi residential gateways
(RGWs) to virtual RGWs or WLAN gateways.

Soft Generic Routing Encapsulation has emerged as one of the industry’s leading choices for this
protocol. It is now embedded in chipsets used in RGWs and deployed externally in Wi-Fi APs and
controllers supplied by leading industry vendors. As a result cable MSOs will not be impeded by fixed
access network dichotomies where costs and inefficiencies can slow deployment.

Deliver community Wi-Fi

Extending network capabilities beyond the home to provide community Wi-Fi is also important. To
enable this service with their networks, cable MSOs need to make RGWs a shared network resource.
This should be supported with network architecture elements that enable integration and management
of public and private user traffic in RGWs and across the whole network.

The key to this is the WLAN gateway. Cable MSOs now have access to highly scalable, resilient
WLAN gateways that support the required advanced capabilities, including authentication, subscriber
management, billing and anchoring of user devices.

These gateways also provide:

       •   High bandwidth and aggregation
       •   Granular traffic conditioning
       •   High-density subscriber management
       •   Interworking with a cellular mobile packet cores
       •   High availability

They also need to provide per-subscriber, per-device, and per-application assurance, and management
capabilities for value-added services.

Extend services across Wi-Fi and LTE/3G networks

Cable MSOs may also wish to consider extending their advanced broadband services through access
to LTE and/or a packetized layer of 3G radio access networks. When adopting this service extension
across multi-access network architecture, perhaps to support a Wi-Fi First oriented services strategy,

eBook - Cable 2020 Foundations                                                                  Page 25
they need to consider a range of areas such as mobility, security, and provisioning to ensure the
continued delivery of a quality user experience.

For broad applicability, standards-based gateways and authentication/policy platforms are required to
deliver secure access and seamless mobility between the Wi-Fi and LTE/3G networks.

Make the concept a reality

These and other technology solutions let cable MSOs make Wi-Fi a strategic business component
-- with potential extension to a Wi-Fi First strategy. They allow cable MSOs to leverage their Wi-Fi
deployments to maximum advantage today without waiting for the rest of the industry to catch up.

By moving 1st, cable MSOs can deliver a personalized user experience over high bandwidth
connections. They can satisfy consumer and business demand for anytime, anywhere access to video,
data, voice, and other value added services.

For more information on making an MSO Wi-Fi strategy a reality, and if desired the extension to embrace
Wi-Fi First, please visit our Wi-Fi and mobility for cable MSOs info center.

Virtual Home Gateways Improve Customer
Experience
Alan Marks, Cable MSO strategic marketing, Alcatel-Lucent

With virtual home gateways, service providers can significantly improve the customer’s overall
experience. The business value provided by these virtualized gateways is largely due to improved service
quality and improved customer care. And along with increased customer satisfaction is higher ARPU,
faster time-to-revenue, and reduced churn.

As highlighted in a virtual residential gateway blog, with a virtual home gateway service providers can
streamline service delivery, turn up new and innovative services more efficiently, increase revenue, and
lower CAPEX and OPEX for existing and new services. Virtualization of home gateway functions enables
faster time to market for new services, including:

       •   Per device quality of service (QoS)
       •   Parental controls
       •   Firewall and security/threat protection

It also assures faster evolution to new technologies, such as IPv6. Just as important, virtualization
enables a centralized management model that simplifies service deployment and troubleshooting.

eBook - Cable 2020 Foundations                                                                      Page 26
Streamlined service delivery

By virtualizing within the network cloud, the functions historically implemented in the residential gateway
can be moved back into the network. This makes everything simpler for service providers and, more
importantly, for customers.

Virtual home gateways, also called virtual residential gateways (vRGW), let service providers move
subscribers to a single, virtual platform for all services. This eliminates the need to stock and deploy a
variety of gateway devices to address different customer needs.

Fewer device variations means significant operational cost savings for operators. There are fewer
configuration changes and firmware updates to apply as capabilities, features, and functions change
over time. And when updates are needed, they can be easily applied without having to replace
equipment or send technicians to resolve deployment or network issues.

More importantly, service fulfillment and customer care can be improved significantly. With a central,
virtual environment, network-hosted RGW and home management functions are easier to manage
compared to a decentralized deployment model where the RGW and other equipment in the home have
to be accessed directly.

Centralized management with IP terminations of home equipment in the network gives service providers
better visibility into a customer’s home network and all the devices connected to it. Among the benefits
enabled are:

       •   Simplified service provisioning
       •   More effective proactive and reactive remote management of service quality and performance
       •   Fewer calls to the help desk
       •   Increased likelihood that customer issues can be resolved during the first call

Increased customer control

All these benefits contribute to a better customer experience. But the vRGW approach improves that
experience even further by giving customers greater and simpler control of their services. With a vRGW,
service providers can introduce a unified cloud dashboard that lets customers easily apply per device
QoS, opt for enhanced security such as firewalling or web filtering at the household or device level, or
apply more effective parental control over services and Internet access.

Virtualization improves the bottom line

The shift to a virtual home gateway approach has to make good business sense, too. While delivering a
better customer experience will increase customer loyalty and reduce churn, it’s always good to know
just how that translates to the bottom line.

eBook - Cable 2020 Foundations                                                                       Page 27
Research and business modelling conducted by Bell Labs shows a strong business value to service
providers that move to a vRGW network structure. Bell Labs analysis for a fixed line operator showed a
24% operational savings in fulfillment and assurance costs over a 5 year period. It also showed a 31%
percent increase in revenue for new services as a result of the faster time to revenue enabled by vRGWs.
And by improving the customer experience and reducing churn, service providers can further increase
revenue by 10%, while saving 35% on ongoing subscriber acquisition costs.

That’s a compelling business case for virtual home gateways.

The Alcatel-Lucent solution

Alcatel-Lucent offers a complete virtual residential gateway solution for service providers, as shown in the
figure.

                               Figure 7. The Alcatel-Lucent vRGW solution

To learn more about our vRGW architectures and how operators can improve the subscriber experience,
please listen to this webinar on the topic “Improving the Customer Experience with Virtual Home
Gateways”.

The webinar highlights how, by deploying virtual residential gateways, operators can enable both
subscribers and the help desk to better manage the home network, connected devices, and advanced
features delivered from the network.

       •   How improving the customer experience drives the business case for virtual home gateways
       •   Characteristics of virtual residential gateways
       •   How virtual residential gateways can simplify subscriber self care and improve assisted care

eBook - Cable 2020 Foundations                                                                     Page 28
Chapter 4: Getting Your Network Fit for
Cable 2020
MSO Network Forecast is Partly Cloudy
By Marcus Weldon, President of Bell Labs and Corporate Chief Technology Officer, Alcatel-Lucent

Taking the position that CONTENT, CONNECTIVITY, and CLOUD are the 3 essential ingredients for
the future success as a user experience provider, let’s map out the evolution of the MSO network.

CLOUD and CONNECTIVITY can be combined to minimize today´s network complexity, lack of
dynamic scalability, and non-optimal cost structure. And also to unlock unfulfilled commercialization
potential (new revenue). Moving to a cable edge cloud architecture and using technologies such as
SDN and NFV will allow the creation of a network that is 100 times more powerful in terms of higher
bandwidth and lower latency than today.

MSO network evolution

Today, MSOs generally run separate siloed networks as shown in Figure 1. They’re comprised of:

       •   HFC for residential and small business internet and video services
       •   PON for greenfield deployments and high capacity business services
       •   Some IP and carrier Ethernet business services and wireless (including Wi-Fi) backhaul
       •   SDH/SONET for legacy voice and video network transport

These different networks are disjointed from an operations standpoint, which results in excess cost and
lack of service continuity from one domain to another.

                                  Figure 8. Today´s MSO network silos
eBook - Cable 2020 Foundations                                                                    Page 29
The (r)evolution

I predict that moving forward the following changes will be made by the leading MSOs to prepare for
future success:

      •   Wireline and wireless access will converge into a single ultra-broadband access network, with
          wireline access infrastructure providing wireless connectivity to all people, places, and things.
      •   Real estate facilities such as hub offices will no longer be an OpEx burden, but rather a key
          enabler of cable edge cloud hosting.
      •   Customer premises equipment will increasingly only provide basic connectivity and (video)
          device control, with all enhanced services provided by ”virtual CPE” functions running in the
          edge cloud.
      •   The HFC network will migrate to Converged Cable Access Platform (CCAP) with virtualization
          of L2/3 functionality using edge cloud facilities and remote physical layer nodes, serving small
          user groups.
      •   Fiber-based technologies such as PON will increasingly be used to connect these remote
          nodes to the edge cloud control plane, to provide wireless (cellular and Wi-Fi) backhaul, and
          to provide business services.
      •   IP and optical transport layers will become more tightly integrated using SDN-approaches to
          provide lowest cost/bit metro and core transport with the scalability, agility and efficiencies
          necessary to deliver differentiated all-IP and cloud services.
      •   The shift from broadcast video to unicast will be driven by the arrival of cloud-DVR services
          and the human desire to consume personalized content anywhere, anytime on mobile
          devices. The resulting massive-scale CDN will be hosted in the same cable edge cloud.
      •   User-generated and artisanal content will become increasingly professional in quality and will
          begin to compete with large-scale content.
      •   OSS systems will be radically simplified, driven by the move to a single ”all IP” network
          infrastructure, with SDN and NFV support. This will massively accelerate service automation
          and innovation, and enable new IP and cloud-based business models.

eBook - Cable 2020 Foundations                                                                     Page 30
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