IP Networks & Applications
Creating Value Through Applications & Analytics
Bhaskar Gorti President, Applications & Analytics Our market is 1. More fragmented different from 2. Pure software play Nokia’s 3. Multi-vendor, multi-network Networks 4. Different buyers businesses Portfolio drives new markets and reinvent old ones
Cloud Analytics IoT Security
Business Support Operation Support Service Delivery Systems Systems Platforms Foundation: Technology Depth & Innovation
#1 device #1 Centralized self Customer experience management organizing network management Strength
Multi-tenant, Cloud platform Automated quality and Most complete CEM product securely manages >1.5B performance management. set on the market. devices
OSS leadership NFV/SDN leadership Best innovation in IoT
Innovation in analytics, Nokia has most Standard-based device assurance and Cloud. comprehensive NFV/SDN management, security, and portfolio. analytics in platform.
Source in order: Analysis Mason 2015, IHS Technology, SON & Optimization Software Market Report 2016, Analysis Mason 2015, TBR NFV/SDN Telecom Market Landscape, First Calendar Quarter 2016, Broadband World Forum 2016 Show Award Market drivers: Worlds colliding to create an opportunity
Network-Attached Software Players Market drivers: Worlds colliding to create an opportunity
Nokia Oracle Ericsson Amdocs Huawei Netcracker
Network-Attached Pure Software Software Players Players Market drivers: New Players Webscale Worlds colliding to Open Source create an opportunity Do It Yourself
Nokia Oracle Ericsson Amdocs Huawei Netcracker
Network-Attached Pure Software Software Players Players Market drivers: New Players Webscale Worlds colliding to Open Source create an opportunity Do It Yourself
Nokia Oracle Ericsson Amdocs Huawei Netcracker
Network-Attached Pure Software Software Players Players Market drivers: New Players Worlds colliding to Disruption create an opportunity Innovation
Nokia Agility Carrier-grade Speed Scale
Network-Attached Pure Software Software Players Players How do we move from a network-attached to a software business at scale? Building a software business at scale
1. Build software sales organization 2. Strengthen and expand portfolio 3. Diversify markets and business models Evolve Go-to-Market: software sales force and new operations commercial models
Services: efficient back and office, move to more SaaS organization and hosted offers Research & Development: Common Software Foundation reduces middleware costs by 60% and deliver value faster Nokia Bell Labs Future X A clear vision Digital Value Dynamic 7 ANP, CSP, ICP, 8 of how Platforms Vertical apps Data Security • New trust framework External data sources networks • Ecosystem sharing Augmented • Mass edge monitoring 6 Analytics Machine need to Cognition Systems learning Open APIs evolve Management & Programmable Dynamic Dynamic Multi- 5 customer Orchestration network operator Network OS services SDN NFV optimization federation
Universal Common data layer 4 Adaptive Core Access agnostic modular, decomposed converged core network functions
self-optimized Short coverage 3 Smart Network Fabric waves & capacity & wires Long fibers
Humans Massive Converged Access 1 2 Software & Machines Scale Access Edge Cloud defined, end-end Remote Applications & Analytics Primary investment domain Secondary investment domain
Business Group vision • Automating edge/telco Digital Value Dynamic 7 ANP, CSP, ICP, 8 cloud networks Platforms Vertical apps Data Security • New trust framework • Cognitive network External data sources operation • Ecosystem sharing • Mass edge monitoring • Terascale automated Augmented 6 Analytics Machine IoT/device management Cognition Systems learning contextual security Open APIs • Future enterprise Management & Programmable Dynamic Dynamic Multi- interactivity 5 customer Orchestration network operator Network OS services SDN NFV optimization federation
Current Portfolio Focus Universal Common data layer 4 5 6 7 8 Adaptive Core Access agnostic modular, decomposed converged core network functions • Cloud/NFV orchestration and operations self-optimized Short coverage 3 Smart Network Fabric waves • Any device management & capacity & wires Long • Novel Enterprise comms fibers • Augmented network + user analytics & security solutions Humans Massive Converged Access 1 2 Software & Machines Scale Access Edge Cloud defined, end-end Remote Diversify markets
Primary market
Communication Service Providers Diversify markets
Primary market Attractive adjacencies
Communication Over the Top Digital IoT Verticals Service Players Enterprises Providers 6.5% Applications & CAGR €16bn Analytics Primary market outlook €12bn
Primary market includes sales of BSS, OSS and SDP to Communication Service Providers 2016 2021
Source: Nokia estimate 15.8% CAGR Applications & €13bn Analytics Market outlook for attractive adjacencies €6bn
Adjacencies include emerging Cloud, Analytics, Security and IoT businesses and sales to Over-the-Top players, Digital Enterprises and IoT verticals. 2016 2021
Source: Nokia estimate Applications & Analytics : Higher returns through focused growth Required investments already factored into long-term Networks guidance
Disciplined expansion and diversification Strong long-term business model
Primary Attractive Net sales: market adjacencies Grow with the primary market
Long-term operating margin:
€12bn in 2016 €6bn in 2016 Expand to double digits 5 year CAGR 6.5% 5 year CAGR 15.8% Applications & Analytics Nokia will achieve the EUR 1.2 billion cost savings target
Adopt Nokia Use Common Operational Business Software efficiencies System Foundation with scale Applications & Analytics Looking forward 2016 2017 2018 • Software strategy in place • Common software • Software suite for major elements delivered product lines • Common architecture and components defined • Streamline service • Diversification success offering • Software sales • Improved service and care enablement • New commercial offers attach rate (SaaS, Hosted) • Dedicated sales force Disclaimer
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