Mobile video optimization and delivery is becoming increasingly important as video traffic exceeds 70% of mobile data by 2016. Cisco's mobile video optimization solutions address this challenge through policy management, content delivery networks, bandwidth management, offloading, client optimization, and data analysis. These solutions help mobile operators optimize bandwidth usage, improve quality of experience for users, and open new monetization opportunities through video services and partnerships.

1. Mobile Video Optimization
and Delivery
Jim O’Leary
Sr. Mobile Solutions Marketing Mgr.

2. Remember When …..
Landline Phone $30 Month
Your telephone was just a telephone?
Phone Company – only game in town
Problem – I must have misdialed, my mistake?
Cable / IPTV ~ $40 per month
Our TV was just a TV?
Cable / IPTV / Satellite – were the main providers
Problem – Change providers
TV~ $80 per month
And now
My TV is my PC
My Tablet is my TV
And my Phone is my TV Remote

3. So What Do Mobile Users Want?
Mobile Network Quality
• 65% want consistent performance
• 56% want uninterrupted service / dropped calls
• 47% want consistent speed
• 44% want higher speeds for browsing, downloads, movies
• 36% want National Coverage
• 27% want speedy network repairs
• 13% want Global Coverage
Mobile Video Viewers
• 10 seconds: 20% of viewers abandon a What Mobile Users Expect
video that doesn't hold their attention
• 30 seconds into an online video as many •71% of Mobile Users expect data for websites to load
as third of viewers have moved on as fast on their Mobiles as on their PC’s – Broadband
• 1 minute 44% have left • 43% of Mobile Users are unlikely to return to a website
• 2 minutes almost 60% have gone that loads slowly.
Sources: Cisco, Heavy Reading Yankee Group, Compuware

4. Mobile Operator Top Concerns
Addressing Managing Monetizing and
Spectrum Scarcity Traffic Growth Differentiating
Ubiquitous Connectivity Service Continuity Service Innovation

5. Video Exceeds 70% of Mobile Data Traffic by 2016
12,000
Exabytes per Month
10,000 78% CAGR 2011–2016
8,000
6,000
Mobile VoIP (0.3%)
Mobile Gaming (1.1%)
Mobile M2M (4.7%) 4,000
Mobile File Sharing (3.3%)
Mobile Web/Data (20.0%) 2,000
Mobile Video (70.5%)
0
(Figures in legend refer to traffic share in 2016.) 2011 2012 2013 2014 2015 2016
Source: Cisco Visual Networking Index (VNI) Global Mobile
Data Traffic Forecast, 2011–2016
#CiscoPlusCA

6. NA Mobile Data Traffic Growth / Apps
Video to reach 71 Percent of Mobile Data Traffic in 2016
2,500
Exabytes per Month
75% CAGR 2011–2016
2,000
1,500
Mobile VoIP (0.2%)
Mobile Gaming (.6%) 1,000
Mobile M2M (1.2%)
Mobile File Sharing (1.5%)
Mobile Web/Data (25.7%)
500
Mobile Video (71.0%)
0
(Figures in legend refer to traffic share in 2016.) 2011 2012 2013 2014 2015 2016
Source: Cisco Visual Networking Index (VNI) Global Mobile
Data Traffic Forecast, 2011–2016
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7. $ Margin Per GB Per Year Declines Dramatically
Rate of Margin Per GB decline Slows as Traffic Growth decreases
Margin Per GB Per Year
$80.00
$77.31
$75.00
$70.00
$65.00
W Europe $Margin Per Gigabyte $60.00 $53.91
$55.00
C/E Europe $50.00
$36.69
$45.00
N America $40.00
$35.00 $24.07
C/L America $30.00
$25.00 $15.11
$11.87
Asia-Pacific $20.00
$15.00
$10.00 $10.54
M East/Africa
$5.00
$0.00
2010 2011 2012 2013 2014 2015 2016
Margins per GB decline slower as Traffic growth slows - indicating that price increases that would slow
Traffic growth could significantly improve margins Source November, 2011 Strategy Analytics

8. Wireless Data Growth
Leads to Spectrum Deficit

9. Mobile Video Ecosystem
Consumer Broadcasters Business Service
Behavior and Media Models Providers
Fragmented Going Direct Diverging Colliding
Video = 71% of all Mobility
traffic by 2016 Multiple-screen offering
CE companies pursuing becoming table stakes
New interactive content – IP Video
29% Sky Sport TV on iPad /
10B Mobile devices
RTL on iPhone and iPad
projected by 2016
3G/4G Wireless
Rising CAPEX to support
Netflix = 29% of US
OTT Video, limited revenue
downstream peak Offering wider content
Building application and upside
internet traffic choice on-demand
content eco-systems
Online Video Snacking
11.4 Hour /month
Pressure to adapt content New Streaming
Discrete Content on for multiple screens and Services from non- Partnerships and
Discrete Devices cost-efficient delivery Traditional Players Vertical Integration
Cisco Confidential 10

10. Most Users Will be in the GigaByte Club
2011 2016
By 2016, 60 percent of
mobile users (3 billion
92 MB 1.2 GB people) will belong to
Traffic/month Traffic/month the Gigabyte Club,
3 Video Clips 10 Video Clips generating more than one
5 Videos gigabyte of mobile data traffic
5 Audio tracks 50 Audio tracks per month.
1 Video call 3 Video calls
In 2011, 0.5 percent of
5 App Downloads 10 App Downloads mobile users belonged
to the Gigabyte Club.

11. Cisco Videoscape Architecture
Cloud Network Client
Media Suite Portals
DSL/FTTH/Cable
Content Entitlement & EPG
Media GW
Soft Client and Access Analytics
Management, Linear Service Apps
EPG
Meta
ASR
Managed 9000
Content Acquisition Suite
Transcode, ABR, Content Distribution
Preparation Suite
Wi-Fi
CDN Caching ASR
CDN Streaming
CDN Acquisition 5000
Application Suite Mobile
3G / LTE
Internet Content Adaption Engine Video
Time Shifted TV and Cloud DVR Gateway
Conductor R1.0
Video Information
Managed Video
Offline OTT Video
Online OTT Video
Messaging/Control

12. Congested
RAN Sector
High # of
poor quality videos

13. Congested
RAN Sector
High # of
poor quality videos

14. Cisco Intelligent Mobile Packet Core
Cisco Policy OCS
Provisioning Tool
Mobility Unified Reporting OFCS
AnaLytics (MURAL) HSS /
Cisco SSC AAA
(SPR)
Cisco ASR 5000 Cisco ASR 5000
SGSN Cisco IPCF PGW
MME GGSN DPI
SGW PCEF
DPI
Messaging
Voice
Video
IP
Music
Core
Peer-to-Peer
Web Page

15. Cisco Intelligent Mobile Packet Core
Cisco Policy OCS
Provisioning Tool
Mobility Unified Reporting OFCS
AnaLytics(MURAL) HSS /
Cisco SSC AAA
(SPR)
Cisco ASR 5000 Cisco ASR 5000
Cisco IPCF PGW
SGSN
GGSN DPI
MME
SGW PCEF
DPI
Messaging
Voice
Video
IP
Music
Core
Peer-to-Peer
Web Page

18. Cisco Intelligent Mobile Packet Core
Cisco Policy OCS
Provisioning Tool
Mobility Unified Reporting OFCS
Analytics (MURAL) HSS /
Cisco SSC AAA
(SPR)
Cisco ASR 5000
Cisco Content SGSN SGW MME
Adaption Engine Cisco IPCF PGW
(CAE) GGSN DPI
PCEF
DPI
Messaging
Voice
Video
IP
Music
Core
Peer-to-Peer
Web Page

19. Cisco Intelligent Mobile Packet Core
Cisco Policy OCS
Provisioning Tool
Mobility Unified Reporting OFCS
AnaLytics (MURAL) HSS /
Cisco SSC AAA
(SPR)
Cisco ASR 5000
SGSN MME SGW
Content Adaption Cisco IPCF PGW
Engine (CAE ) GGSN DPI
PCEF
DPI
Messaging
Voice
Video
IP
Music
Core
Peer-to-Peer
Web Page

20. + Platinum
+ Video Service
- Gold
Voice Services Level 1 Overuse
Social Media
• Cap Social Media 3Gbps
Non-carrier VoIP
Streaming
Level 2 Overuse
Gaming
email • Cap Gaming
Web • Adjust Video Transcoding
Tunnel • Apply Level 1
+ Silver
Emergency Services Priority
Preview Profiles Schedule Immediate
• Block P2P All Save as New Profile

21. + Platinum
+ Video Service
- Gold
Voice Services Level 1 Overuse
Social Media
• Cap Social Media 3Gbps
Non-carrier VoIP
Streaming
Level 2 Overuse
Gaming
email • Cap Gaming
Web • Adjust Video Transcoding
Tunnel • Apply Level 1
+ Silver
Emergency Services Priority
Preview Profiles Schedule Immediate
• Block P2P All Save as New Profile

22. Mobile Video Optimization
No One Single Solution Is A “Silver Bullet”
 Optimization solutions for Internet web browsing and video streaming
 Policy management solutions to apply policy and charging rules
 Content Delivery Networks (CDNs) to cache and optimize content
 DPI-enabled bandwidth management solutions
 Offloading solutions
 Client-based optimization solutions with software on the mobile device
 Network probes and software analytics for the Radio Access Network (RAN) and the
core network
 Protocol analyzers and transport optimization hardware
 Data Aggregation and Analysis
#CiscoPlusCA
Source: ABI Research 2011

23. Mobile Video Services
New Revenues from Video Content Partnerships
Video Content Provider
What’s the Opportunity? e.g., Netflix, Hulu,
 Forge partnerships with video Blockbuster, Sky TV, etc.
content providers for high quality Cisco
Videoscape
internet video streaming experience
What are the Benefits?
 Sell premium video services with
partners’ video content services
 Upsell higher Data Tiers to support
increased video consumption
 Manage video bandwidth impact
Leverage popularity of select OTT video
content for win-win new services revenues

24. So Which Would You Prefer?

25. Mobile Policy
“The policy engine is the
brains of how you want the Policy
network to treat different
things at different times.
It's essential. “ Triangle
Of
Intelligence
Tony Melone Network Service
CTO of Verizon Communications Intelligence Enablement
March 16, 2011
Source: Fierce Wireless, March 16, 2011
Cisco Confidential 26

26. Tiered Plans
Gain New Subscribers & Optimize Bandwidth
What’s the Opportunity?
 Offer plans at varying usage
quotas and speed tiers
What are the Benefits?
 Drive ARPU with new pricing
 Attract wider range of users
 Up-sell higher tiers to top users
Subscriber conditioning
important in shift to
Usage-Based Pricing
Users are becoming
more data quota aware
Source: 2012 Mobile Life Survey, Light Reading

27. Tiered Services: Speed Tiers with Video
Gold Tier (Policy)
Up to 1 MBPS
$25/Month
The Sports Fan
Silver Tier (Policy)
Up to 512 KBPS
$20/Month
The Business User
Original Video
1.5 MBPS
Bronze Tier (Policy) Up to
256 KBPS $15/Month
The Casual User

28. It’s not Just About Offload: Transforming Experience
& Growing Revenues
Wi-Fi as a hotspot Wi-Fi as a mobile
technology: a wireline offload technology: a
service cellular network
optimization tool
2009 2010 2011 2012
Wi-Fi as a platform for:
• Service innovation
• Revenue growth
• Experience transformation

29. Mobile Offload & Service Bundling
Generate Significant Internal Value
• Bundled Wi-Fi
• Bundling Wi-Fi service to another service
• Example: mobile data package, broadband
• Typically free of charge
• Reduced customer churn
• Increased market share for core services
through differentiation
• Offload mobile data traffic using Wi-Fi
• Serve huge growth in mobile data traffic
• Reduce 3G/4G CapEx and operating costs
• Estimated savings: $3 - $5 /GB

30. Wi-Fi is an Important User-Driven Trend
80% of the time users 19 out of 20
smartphones
are within Wi-Fi coverage
support Wi-Fi
Mostly nomadic use
50% of smartphone
usage is already on Wi-Fi
100%
50%
50%
23%
0%
2010 2011
Sources: Cisco Visual Networking Index, 2011; Bango Inc., February 2011; North Carolina State Univesity, Cisco IBSG 2011

31. Ad Supported Video Promotions with
Cisco SP Wi-Fi Solution
What’s the Opportunity?
 LBS and Ad Supported Video 20%
Off
What are the Benefits?
 Reduced traffic on 3G / 4G RAN
 Create LBS & Advertising Models
Secure Wi-Fi
Network
Users are becoming Discovery
more data quota aware:
supply reduce cost
options

32. Medium Sized Operator
• Subscribers • Network dimensions
– Total: 15M growing to – Models 3G and 4G radios
18M+ – 2000 cell sites (5%
growth)
– Data: 5M growing to 14M
– 400 pre-aggregation sites
– Video: 1.8M growing to
5.3M – 25 aggregation sites
– “Urban” cell sites (20%)
• Traffic carry 40% traffic with GE
backhaul
– Total: 1.3M to over 35M – “Non-urban” cell sites
TB/mo carry 60% traffic with T1
– Video: 0.6M to over 24M backhaul
TB/mo (67% of data) – Network transport variable
– 150 MB/month per sub – All packet core elements
modeled

33. $400 $60
Cost Saving ($M)
$ Payback for $1
$350 $50
$300
Invested
$250 $40
$200 $30
$150 $20
$100
$50 $10
$0 $0
5% 10% 15% 20% 25%
Percentage Traffic Reduction from Video Pacing
Savings Payback

34. Traffic Packet & Video Optimization
Offload, Video Pacing, Optimization
Optimized Video reduction potentially 20 - 40%
Un-optimized Video reduction up to 75%
Why Cisco Optimization?
Optimize
45%
26%
12% Potential reduction of up to 26% in video traffic Lower radio costs Video
Video
Pacing
Data and
Tsunami
Downlink data reduction potentially 10 – 30 % Increase network capacity
Offload
Internet
Enhance customer experience
ASR5k
Indoor
Hotspot Mobile Backhaul IP Core
UE
7600
Increase network efficiency App
OS
App
OS
ASR9k CRS-1
ASR9k
(e)NB MWR2941
Reduced latency Mobile Videoscape
Potentials savings of 10% to 50+%*

37. Verizon Introduces New Version of VoD App
for Mobile Phones
• VzW Mobile Video – On – Demand
• Customers access more than 250 current, full-
episode TV shows from all the major broadcast
networks
• Premium video content
• Requires a USD $10 monthly subscription
• A data package is required, and the download and use of Verizon Video
incurs data usage and will be billed according to the customer's data
package.
MONETIZE
Source: 23 August 2011 Telecompaper Americas, Verizon Wireless Sources

38. MONETIZE
Vodafone Germany Plans Triple Play TV with LTE
Challenge/Opportunity
• Current mkt dynamics: EUR500 mill./year in unbundled DSL costs Unbundled costs paid
• Mkt Opportunity: Migrate DSL customers to LTE, incl. TV
• SP Strategic fit: Challenge DT on triple play with new bus. model out to DT every year
Experience Innovation EUR 500 million
• Service description: LTE-enabled set top box for triple play
• Drivers for end-user adoption: Low cost via cellular
• Risks and sensitivity for service adoption: Availability, experience
Monetization
• Monetization: No unbundled costs improves 3-play bus. model
• Market size: Unknown
• Revenue sensitivity: NA
• Cost analysis: LTE bandwidth mgt. for TV packet prioritisation
Strategic Partnership/Alliance Migrate 4 mill. DSL
• Ecosystem: None customers to LTE, with TV
• B2C
• Risk assessment 4I’s:
• Innovation, Internal, Interdependency: Low
• Integration: High

39. The Mobile Network of Tomorrow
Unified Access - Macro, Pico, Femto, WiFi
Complexity Opportunity
3G/4G
Optimal usage of network resource under
Macro Site dynamic conditions for best user experience
• Real time access selection decisions based
Femto Cell on location, network load, available
connectivity, User service level
Stadium/ • Application and service driven traffic routing
Hotspot
residential • Inter-access load balancing
Access selected by end • Real time feedback for up to date network
conditions
user or the device itself

40. Leveraging the Device for Network Optimization
3G/4G
AAA OCS Service
Macro Site
HSS PCRF Delivery
SPR Analytics
Femto Cell S14
IP ANDSF
Stadium/ Backhaul
Hotspot Mobile Packet
Core
ANDSF (Access Network Discovery and Selection Function) SP Internet
Services
• Provides dynamic policy updates and receives data from UE
• Can constructs policies based on user profile, session status and
dynamic network updates
• Dynamically pushes policy updates based on network triggers
• Receives data from the device and distributes it accordingly

41. Cisco Mobile Internet Market Leadership
270+ Operators in More Than 75 Countries
34 LTE Wins; 13 Live Deployments
800+ Million Subscribers Across Mobile Packet Cores
800K Femto Cells Deployed
12M Wi-Fi Access Points

42. Q&A
#CiscoPlusCA

43. Thank You
More information www.cisco.com/go/mobile