Killer Platform Engine Business Strategy and Economic ...docs4sale.com/img/products/uploads/jgal5a_Broadwing...The Killer Platform Engine will enable BRW to meet its business needs

Killer Platform EngineBusiness Strategy and Economic

Justification

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The purpose of this meeting …

Agree that the Killer Platform is missing the Killer Platform Engine (KPE).

Concur that the highest quality and mix of revenue Broadwing will realize as a global player for Next Generation services, requires investment in the KPE as a critical asset of the Killer Platform.

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To revolutionize our ability to attract and service high profit customers consistent

with Broadwing’s Next Generation Network Provider promise.

The Vision

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The Killer Platform Engine will enable BRW to meet its business needs ensuring the company successfully implements its strategies.

BroadwingBusiness Needs Strategies

Accelerate high-margin revenue growth

Implement a KPE that can support rapid development of new services designed to increase network and data center usage.

Implement a KPE that will allow partners to work with Broadwing’s networking systems.

Implement a Killer Platform Engine (KPE) that allows Broadwing to deliver new products and services faster than the competition in support of new market opportunities.

Implement a KPE that can quickly and efficiently support new services for both partners and customers.

The BRW Challenge

Provide superior customer experiences:

• CBI• Broadwing

Implement a KPE that allows Broadwing to deliver new products / services faster than the competition in order to stifle competitive entrants to existing customer markets.

Implement a KPE that consistently delivers high-level QoS and supports Web-based functions such as service ordering, enhanced bill presentment and payment on-line.

Implement a KPE that can provide a “single view” experience for the company and the customer.

Implement a KPE that integrates business processes with existing systems and new OSS applications.

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What Does Success Looks Like?

Rapid acceleration of high profit BRW National network revenues

Rapid acceleration of high profit BRW Hosting revenues

Dramatic improvement of customer experience at CB

Profitable new revenue growth at CB from new applications and services

Definition of Success

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– What are the industry trends? – Do we have the OSS capability to attract the right quality and

mix of revenue?– What is the competition doing today?– What is the next generation OSS/BSS platform a.k.a. Killer

Platform Engine (KPE) and how does it work?– Will the proposed solution provide significant incremental

competitive advantage?– What investment is needed to implement the KPE and what is

our expected return?– How big is the risk for not implementing the Killer Platform

Engine?– What is the full potential of the Killer Platform Engine?

This presentation will answer the following key questions and confirm the need for the Killer Platform Engine.

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Competitive differentiation is achieved by having flexible, secure, Web-based software that allows customers to satisfy their needs on a near real-time basis. Hiding the complexities of technology is the greatest key to a service provider’s success.

Industry Trends

Technology Doesn’t SellTelecom is no longer about the technology. It's about service management and service excellence. It's about business processes and the people who run them. Most important, it's about the relationship between service providers and their customers. It's about throwing the window open and allowing the customer unprecedented access to all that high technology without letting the technology show. It's about a mouse click and, eventually, a voice command.

- Telephony, January 20xx

Supporting the Customer

The customer will not be awestruck by a next generation 5ESS, a multi-protocol softswitchor a highly invisible, high-speed worldwide fiber network. The wows and the whistles will be reserved for the next generation operation support system (OSS).

- Telephony, January 20xx

“…If the network is the brawn of the service provider network, the OSS is the brains.”

- Inter@ctive Week, July 1998

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Many operational capabilities must be addressed to successfully support Next Generation services.

Industry Trends

Operations Capability ImpactsRapid service creation through data schema and process reusability

Competitive differentiation

Services differentiation through improved product bundling and usage based billing

Competitive advantage, increased revenue and market share

Greater visibility and knowledge of customers through a common information model providing a “single view” of the customer

Competitive advantage, improved margins

Customer self-service through Web-based portals

Improved efficiency and customer satisfaction

Ease of integrating with strategic partners through Web portals, adapter frameworks, and OSS interconnection capabilities

Higher revenue

Improved business controls and visibilityover operations through workflow and a process-based engine

Improved efficiency, lower costs and increased margins

End-to-end operations focus targeted at business results e.g. “Quote-to-Cash” through process orientation

Increased revenue and rapid market capture

Quality of Service through improved network performance, monitoring and tracking tools that support service level agreements

Improved customer satisfaction

Scalability and agility through a message bus architecture and adapter framework

Growth, accommodates change

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The market for broadband access and IP services is expanding by more than 40% per annum. Capital markets expect Broadwing to emerge as a leader in the national IP services market.

Market Opportunity

Product 20xx 20xx 20xx 20xx 20xx 20xxDSL (Total US Market) Forrester Research, Inc., 20xx 650 1,400 2,860 3,870 4,810 5,330Internet Access ( US Business)Forrester Research, Inc., 20xx

FT1/T1 3,019 5,619 7,921 9,268 11,051 12,856DS3 1,345 3,696 7,610 12,657 13,554 18,273OC3 351 1,094 2,339 4,140 7,147 10,947Dial (ISDN incl.) 3,314 4,458 5,607 6,627 7,735 8,826Cable 276 697 1,225 1,786 2,767 3,950

VPN (Total US Market)Yankee Group, 20xx

Network Based 29 136 348 774 1,510 2,649CPE Based 392 658 1,104 1,807 2,775 4,096Frame Relay 93 119 159 232 352 531

Total - Communications Services 9,469 17,877 29,173 41,161 51,701 67,458

Revenues (in $millions)

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Figures in red are projections assuming steady revenue at last available data point.

Market Opportunity

“…all-in-one communications services companies …capable of delivering myriad voice and data services …” (Red Herring, Dec 20xx) is the market expectation for 20xx. Broadwing must capture the national revenue opportunity from network- and content-based services.

Data Source 20xx 20xx 20xx 20xx 20xx


Video on Demand (VOD) F 272 558 983 2,184 3,101 Hosting (incl CoLo, shared, Intranet, etc.) F 5,975 10,029 14,646 14,646 14,646 E-mail Acquistion & Retention (marketing) F 1,291 2,326 3,758 4,770 4,770

VoDSL Y 566 1,121 1,961 3,220 3,220 Transparent LAN Y 271.8 292.0 349.0 349.0 349.0

Multi-tenant commercial IP services Y 355 640 981 982 983 Application Hosting F 3,802 6,846 11,311 11,311 11,311

Interactive video subscriptions F 1,644 2,464 3,577 5,053 7,433 Marketing: ads and commerce fees F 357 1,525 4,737 11,194 17,459

Enhanced HR (on-line) F 2,002 3,139 4,578 5,786 7,067 Security Services F 8,440 11,620 15,282 19,719 19,719

Caching Y 770.5 1,233 1,788 1,788 1,788 Corporate Portal CRM Y 452 817 1,235 1,236 1,237

Network Management Services (incl integration, hosting) Y 13,190 18,580 23,970 23,970 23,970 Outsource messaging Y 3,200 4,390 5,430 5,431 5,432

B2B Advertising F 1,420 2,560 2,560 2,560 2,560

Total US revenue for content services 44,008 68,140 97,146 114,199 125,045 revenue estimates from Yankee Group (Y) and Forrester Research (F)

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Market Opportunity

In the Broadband Communications and Content Market, even a modest share represents a huge revenue opportunity. Does BRW have the OSS capabilities to capture a large share?

Broadwing Revenue Opportunity20xx 20xx 20xx 20xx 20xx

Total - Communications Services 17,877 29,173 41,161 51,701 67,458Total - Content Services 44,008 68,140 97,146 114,199 125,045Total U.S. Revenue Communications + Content 61,885 97,313 138,307 165,900 192,502

Broadwing Opportunity @ 0.1% share 62 97 138 166 193Broadwing Opportunity @ 0.5% share 309 487 692 829 963Broadwing Opportunity @ 1.0% share 619 973 1,383 1,659 1,925Broadwing Opportunity @ 1.5% share 928 1,460 2,075 2,488 2,888Broadwing Opportunity @ 2.0% share 1,238 1,946 2,766 3,318 3,850Broadwing Opportunity @ 5.0% share 3,094 4,866 6,915 8,295 9,625Broadwing Opportunity @ 10.0% share 6,189 9,731 13,831 16,590 19,250


Highest national market growth opportunity is in content services. Broadwing has already set its sites on rapid growth through a combination of new

products and services. Broadwing must continue targeting a mix of both content and communications

services, with an increasingly greater emphasis on content services. KPE is designed to facilitate rapid growth and success in a mixed services

environment.

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010000200003000040000500006000070000

Mill

ions

of U

S Do

llars

1999 2000 2001 2002 2003

Source: Dataquest (June 2000)

Worldwide Operations Support Systems (OSS) Market

Worldwide Wireline Worldwide Wireless Worldwide ISP

1999 2000 2001AT&T 14.0 14.0 14.0WorldCom 8.7 8.5 9.0Sprint FON 3.5 4.5 4.0KPNQwest 1.9 4.0 4.0Global Tele Systems 0.6 0.9 0.6Cable & Wireless 3.0 3.0 3.0Level 3 3.3 6.3 3.0Global Crossing 1.7 3.4 3.0British Telecom 5.5 6.8 6.8Deutsche Telekom 6.0 7.5 8.5French Telecoms 7.0 8.0 8.0Broadwing 0.8 0.6 0.4Williams Companies 1.0 2.9 2.0Enron 1.9 2.2 2.0Other N/A 5.0 3.0Total 58.9 77.6 71.3Year-over-year % change N/A 32% -8%

Source: Blustone Capital Partners

Telecom Service Providers’ Network Spending($ Billions)

“Already the carriers have had to … accept that their once-precious bandwidth will soon be regarded as a cheap commodity.”

-- Red Herring, Dec 20xx

“In order to make money you have to have value-added services …”

The Competition

“BellSouth, Verizon, SBC Communications and Qwest …maintain a virtual monopoly over local phone lines, providing them with steady revenue streams, … direct access to consumers, and are well positioned … when selling value-added services like video on demand and online directories.”

“Wholesale bandwidth prices were falling by 50 percent every 18 months at the end of 1998, but by the middle of 20xx, prices were dropping by the same percentage every 6 months.”

“… Fifteen months ago, Intira a data center company in Pleasanton, CA, was paying 2.5 cents per DS0-mile (64 Kbps connection) and now it is paying about a penny.”

--- Red Herring, Jan. 20xx

-- Rob MacLellan, Director of Business Analysis with RHK

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US Carrier (In Production)– Out-of-Region Bundle Retail Play (DSL, Hosting, Internet)

US Carrier (In Production)– Hosting Play

US Broadband Wireless Access Carrier (In Delivery)– BWA Quote-to-Cash

Cable Operator (In Delivery)– Cable, VOIP

International Carrier (In Delivery)– VPN, Hosting Play

International Carrier (In Delivery)– VPN and other IP services

International Carrier (In Delivery)– DSL Wholesale Play

Broadwing is no longer the only Tier 1 communications provider contemplating the build of an equivalent KPE. KPMG has helped several other carriers launch into new markets using the OSS / BSS Configure-to-Fit (CTF™) Killer Platform Engine.

KPMG Proven Successes

Other service providers are migrating toward a process-managed OSS environment to support Next Generation services. OSS suppliers, solution integrators, and network technology vendors are lining up their development efforts to meet end-to-end process requirements. The market recognizes that competitive differentiation comes from a KPE-like capability.

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Key Points Several conclusions can be drawn regarding industry trends and opportunities in the broadband services market.

Network technology without a superior customer experience is not enough to keep pace with today’s customer expectations.

There is a significant market opportunity for Broadwing in both IP and content services.

Broadwing is no longer the only service provider considering the packaging of content and services through multiple customer network access partners.

If Broadwing is to avoid falling behind in its bid to become a national customer services provider, it should enhance its OSS capabilities now.

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Voice Access

Global TDM Voice Network:Vertical Features (One Size Fits All)

Voice Architecture (TDM)

Long DistanceLocal LocalCPE CPEVoice

Access

ISPs ISPsEmbedded Service and Feature Definitions

Service Boundary

Sale

s Ad

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ntry

Cus

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Bill

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Net

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Assu

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I/F to

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Old World ServicesOSS Environment:

Back OfficeOSS “Silos”

Industry Trends

Traditional TDM voice networks are supported by back office OSS silos. The business focus is on maintaining a network, meeting customer-specific needs is a secondary consideration.

The TDM Voice Network:

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Bridges to Voice World

CPE

Digital BBAccess

• Consumer Market• Enterprise

CPE

Digital BBAccess

• Vertical Features• Multiple Service Classes• Multi Media

Outsourced Business Functions

Network Data Collection to SLA Reporting

Trouble Entry to Service Credit

Customer Inquiry – Order Status, Product Info, Billing

Usage Data Collection to Billing

Service Pre-Sale-to-Order and Order-to-Cash

Directory

IP Services Network:

Next Generation Services Environment -Horizontal End-to-End Customer Processes

Service Boundary

End-to-End IP Network• Transparent to user features• Service independent (“dumb”)• Self-aware (network intelligent)

Industry Trends

Next Generation services require a customer-centric rather than network-centric view of the business. Change is driven by customer needs, competition, and technology.

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Killer Platform Engine (KPE) enables the operations support that is essential for making Liquid Bandwidth “… instantly provisionable, infinitely scalable and incrementally billable”. KPE positions Broadwing as the preferred next-generation “Integrated Communications Provider” (ICP) for its partners and end-user customers.

Is Broadwing’s Killer Platform missing a key ingredient for success?

Killer Platform is “… a combination of unique assets designed to deliver ‘liquid bandwidth’ to customers in Broadwing’s all-optical network strategy.” Liquid Bandwidth will be available to customers in any amount, anywhere, at any time, irrespective of protocol. Liquid bandwidth will also be instantly provisionable, infinitely scalable and incrementally billable.

Source: Wingspan, October 20xx; “Delivering the Killer Platform”Wingspan, December 20xx; “ Exceeding Expectations”

Broadwing Killer

Platform

Killer Platform Engine

These assets include …• A World Class Network• World Class Data Centers• A World Class OSS Engine (The Killer Platform Engine – KPE)

NETWORK - BCS

Data Centers

OPERATIONS SUPPORT SYSTEMS (OSS) – Killer Platform Engine (KPE)

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Messaging System – simplifies the process of sending and receiving messages across distributed applications by combining, validating, transforming and routing data according to definable business rules and configurations.

The Killer Platform Engine is a multi-component OSS / BSS architecture that supports Next Generation services and integrates existing systems and processes with new applications.

KPE Component Description

Workflow Engine – automates the pathway by which work moves around an organization. Manual workflow is often unstructured, uncontrolled, and inefficient. By imposing a set of sequential rules, reusable processes, and supplemental / error recovery procedures, an organization gains consistency, efficiency, and faster time-to-market with new product / services.

Common Information Model (CIM) – is a user configurable persistent data store that facilitates the transfer of common information between various systems via the messaging bus thereby enabling a “single view of the customer”.

Adapter Framework – makes it possible to communicate and update business information that originates from diverse sources and resides on divers host systems within an organization. Adapters support commercial software products or custom built applications.

Messaging System

CIM

API

API

API

API

API

API

API

API

Adapter Framework

Workflow Engine

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Manual Work Functions

Commercial Applications• Customer Care / Billing• Provisioning / Activation• Service Assurance• Network Planning• SLA Management• Sales & Marketing Support• Work Force Management• OSS Interconnection Gateway• Legacy Systems

The KPE is an OSS / BSS Architecture that:

– Is Web-Based for ease of use by all users

– Supports changing business needs through a process-enabledarchitecture

– Minimizes custom software development, speed time to deployment, and mitigate risk by incorporating commercially available software

– Continuously addresses the network topology – offered services – customer details relationship necessary for addressing rapid service provisioning through data-base technologies that can supply a “single view” of the customer

– Supports reusability of processes for rapid creation of future service needs.

– Establishes visibility to business metrics and operational controls.

The Killer Platform Engine enables Broadwing to be the Next Generation Network and Data Center provider for content, services and network access partners, while also providing superior service to its retail customers.

KPE Architecture

API

API

API

API

API

API

API

APIMessaging System

CIM

Adapter Framework

Workflow Engine

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Key Points Several conclusions can be drawn regarding the characteristics of a Killer Platform Engine.


There is a significant market opportunity for Broadwing in both IP and content services. Broadwing is no longer the only service provider considering the packaging of content and

services through multiple customer network access partners. If Broadwing is to avoid falling behind in its bid to become a national customer services

provider, it should enhance its OSS capabilities now.

Next Generation services must be supported by end-to-end process management rather than individual silos of OSS functionality.

The BRW Killer Platform requires a Killer Platform Engine to reach full potential.

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The Killer Platform’s customers include content and service vendors, access network operators, and end-users, each with varying business needs. The KP Engine redefines the customer experience for Next Generation services by meeting their diverse needs.

Customer Experience Today– Contact through call center and

account reps for order entry, billing adjustments, trouble tickets, …

– No single point of contact, multiple phone calls to order services

– Notification of service turn-up not ubiquitous for all products

– Service availability is not well-defined resulting in mismanagement of expectations

– No visibility into customer’s “service profile”

– Lacking in self-service capabilities– Service reps limited to line-of-

business domains with no visibility to the total suite of subscribed to services

– Partner relationships are negotiated and managed without visibility to end-customer level operational results

Customer Experience Tomorrow– Self-service for order entry, EBPP,

trouble entry & management, and service status

– Partners’ ability to view / change product information in shared product catalog

– Single point of contact for all products and needs

– On-line service notification for turn-up and restoration for all products

– Quick and easy on-line queries into service availability

– Capability to view and customize individual service profiles as needed

– Empowered and knowledgeable service reps in all lines of business with 24X7 availability

– Partners’ ability to view and track that they are meeting SLA commitments

– Partners’ ability to control and measure the usage of their products

– Intelligent FAQ, check-to-chat, and check-to-connect

Redefining the Customer Experience

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Key drivers: Build their customer base across access technologies, geographic

locations, and customer segments Need access to ever-increasing bandwidth connecting to customers Control and measure usage of their products Constantly improve on the content and capability of their products Offload functions outside of core product development competence

(such as supporting infrastructure) Need to roll-out new products quickly, with manageable up-front costs

Content / Services vendors’ compelling need is for a superior platform that can deliver their products and services to end-users.

Communication Services Network Infrastructure

Services Financial Services Billing Services Entertainment Services Information Services Enhanced HR Services Marketing Services Interactive Advertising

Dispatch Services Procurement Services Security Services Network Management

Services Customer Relationship

Management Services Consumer and

Personal Services Education Services

CONTENT / SERVICES PARTNERS

Content/ServicesPartners


Broadwing Hosting

Self-HostedASPs

•Lexis

BRWServices

•VOIP•Unified Msg.•Mgd Net. Ops

Content / Services Customer Needs

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Key drivers: Offer customers content and advanced services, not just network access Integrate with national, global, and partner networks Reduce the costs of supporting complex rapidly evolving services Move from the network and technology-centric focus of the past to a

service and customer-centric focus

Customer Access Network Operators’ compelling needs are for an outsourced operations support alternative and a market-driven package of services for resale to end-user customers.

BRWRetail

•VPN•Private Line•Unif. Msg.

EnterpriseCompanies

•Fortune 500•Fortune500-20xx

ILECs withNext Gen.Services

•VERIZON•QWEST•BellSouth•SBC

RuralCarriers

•CITIZENS•ALLTEL

Wireless

•VERIZON•AT&T•SPRINT•NEXTEL•VOICESTREAM

CableMSO

•AT&TBroadband

•COMCAST•AOL(Time Warner)

SolutionsVendors

•KPMG•AC•PWC•D&T•CSC

•HP•COMPAQ•IBM•EMC

ServiceBureau

•Building LECs•Rural Co-Ops

•COVAD•RYTHMNS•NORTHPOINT

•TELIGENT•WINSTAR

DLECs

END USER CUSTOMERS

CBI ISP

•AOL•EARTHLINK•Hughes(Telocity)

•Flashcom

Access Network Customer Needs

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Key drivers: Broadband network access Flexible product packaging – pay only for what you need Advanced services and content Single provider for all communications services Excellent customer service Easy to order, easy to use, easy to fix

End-user customers’ compelling needs are for a superior customer experience and a high-value package of integrated network access and content services.

End-User Customer Needs

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Communication Services Network Infrastructure

Services Financial Services Billing Services Entertainment Services Information Services Enhanced HR Services Marketing Services Interactive Advertising

Dispatch Services Procurement Services Security Services Network Management

Services Customer Relationship

Management Services Consumer and

Personal Services Education Services

The Killer Platform provides Broadwing with world class network and data center services, thereby making BRW a preferred partner to content / service vendors and access network operators.

Killer Platform Vision

Content and Services Partners

BRWKiller

Platform

CONTENT / SERVICES PARTNERS



Broadwing Hosting

Self-HostedASPs

•Lexis

BRWServices

•VOIP•Unified Msg.•Mgd Net. Ops

BRWRetail

•VPN•Private Line•Unif. Msg.

EnterpriseCompanies

•Fortune 500•Fortune500-20xx

ILECs withNext Gen.Services

•VERIZON•QWEST•BellSouth•SBC

RuralCarriers

•CITIZENS•ALLTEL

Wireless

•VERIZON•AT&T•SPRINT•NEXTEL•VOICESTREAM

CableMSO

•AT&TBroadband

•COMCAST•AOL(Time Warner)

Customer Access Network Partners

SolutionsVendors

•KPMG•AC•PWC•D&T•CSC

•HP•COMPAQ•IBM•EMC

ServiceBureau

•Building LECs•Rural Co-Ops

•COVAD•RYTHMNS•NORTHPOINT

•TELIGENT•WINSTAR

DLECs

END USER CUSTOMERS

CBI ISP

•AOL•EARTHLINK•Hughes(Telocity)

•Flashcom

Data Centers

NETWORK - BCS

OPERATIONS SUPPORT SYSTEMS (OSS)

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The Killer Platform Engine addresses the operational capabilities required to capture revenue from Next Generation services.

Operational Needs

Operations CapabilityRapid service creation through data schema and process reusability

Services differentiation through improved product bundling and usage based billing

Greater visibility and knowledge of customers through a common information model providing a “single view” of the customer

Customer self-service through Web-based portals

Ease of integrating with strategic partners through Web portals, adapter frameworks, and OSS interconnection capabilities

Improved business controls and visibilityover operations through workflow and a process-based engine

End-to-end operations focus targeted at business results e.g. “Quote-to-Cash” through process orientation

Quality of service through improved network performance, monitoring and tracking tools that support service level agreements

Scalability and agility through a message bus architecture and adapter framework

Current BRW / CBI Systems KPE

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No

Some

Some

Some

Some

No

No

No

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Allows accelerated introduction of new products, services, and technologies while integrating with existing capabilities.

Allows Broadwing to develop world class network and data center offerings, thereby becoming a preferred partner to content and service providers, access network operators, and OSS solution vendors.

Provides differentiation of the Broadwing networks from the commodity transport and access competitors.

Enables integration of newly acquired networks or other partner network organizations with existing infrastructure and OSS environment.

Changes OSS from a cost to a profit center by developing OSS solutions that allow Broadwing to sell operations support services to other network operators.

Using the Killer Platform Engine, Broadwing will be a world-class ICP that provides benefits to each of its customer groups while creating substantial value for its shareholders.

Broadwing Benefits

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Provides CBI a way to manage change, rather than change managing CBI Supports customer service selection options, e.g. Web-based service

selection and billing Enables the ability to continuously update services and content information

with an existing customer base

Allows CBI to pilot market new products with lowered start-up costs and minimized exit friction

Delivers an integrated view of customer data (customer, services, network) through a process-enabled OSS architecture that can link existing systems with new applications

Supports new billing application functionality

Using the Killer Platform Engine, Broadwing will be a world-class ICP that benefits each of its customer groups while creating substantial value for its shareholders.

CBI Benefits

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The KPMG OSS/BSS architecture (CTF) – currently implemented at a national Telco that provides DSL, email, internet services, web hosting, and web design access to customers – has achieved or will achieve the following operational improvements.

Example productivity gains from implementing KPMG’s OSS / BSS Business Solution Architecture (Killer Platform Engine)

KPMG – Proven Successes

An improved bundled delivery interval for Quote-to-Cash of:– 15 days for business customers (50% reduction in interval)– 45 days for residential customers (33% reduction in interval)

An increase of 25X the number of customers (4Q01) Productivity gains of 6X the number of orders processed per

day by Order Entry representatives (4Q01) Productivity gains of 4X the number of orders processed per

day by Provisioning representatives (4Q01) Productivity gains of 14X the number of orders processed per

day by Billing representatives (4Q01) An unprecedented number of operational metrics to measure

SLA commitments with 3rd party suppliers and the end-to-end service delivery interval are now available. Examples: 4 hour turnaround time for order confirmation, 10-12 day turnaround for order fulfillment, etc.

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Key Points Several conclusions can be drawn regarding the capabilities of the Killer Platform Engine to provide the Next Generation customer experience.




provider, it should enhance its OSS capabilities now. Next Generation services must be supported by end-to-end process management rather

than individual silos of OSS functionality. The BRW Killer Platform requires a Killer Platform Engine to reach full potential.

The KPE redefines the customer experience for Next Generation services by meeting the diverse needs of content / services vendors, access network operators and end-users.

The KPE provides operational capabilities, including a “single view” of the customer, needed for Next Generation services and improves productivity of existing business functions.

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Market share of the U.S. Broadband Communications and Content Services Market is assumed to increase at a half percent per year following completion of the KPE as shown:

Of the total new revenue obtained from the Killer Platform only a portion is assumed annually as a result of the KPE, with the balance allocated to transport services and fees to both access network partners and content / services partners. The annual Net Revenue allocated to the KPE is:

Net revenue projections are based on the combined communications and content services revenue previously defined in this document and as applied to BRW per the assumptions outlined above.

Services supported in this costing model include: DSL (Retail & wholesale), VPN, Internet Access, Hosting, Network Managed Services, Security Services, and Video on Demand (VOD).

Interest on working capital (cost of capital) is assumed at 15% Systems costs include installation, process definition, configuration, data migration and systems

integration services fees to deliver an end-to-end working solution. These fees are based on the KPMG A+Bx model that places at risk most of KPMG’s systems fees until Broadwing realizes the projected increased revenue from the KPE.

Software license fees include the KPMG CTF platform, with engineering estimates as a “green field” for billing, customer care, IP provisioning and inventory applications that are commercially available.

Operating expenses are engineering estimates of on-going personnel for business operation, general maintenance costs for hardware, software maintenance, etc.

The model does not attempt to quantify benefits to Broadwing’s existing lines of business that would be realized as increased sales and improved pricing for existing services.

KPE Economic Analysis

KPE revenue and cost projection assumptions for the economic analysis.

2001 2002 2003 2004 2005Share of U.S. market serviced by KPE

Cincinnati share of U.S. 0.30% 0.30% 0.30% 0.30% 0.30%BW share of Cincinnati market 98% 96% 94% 92% 90%

BW Share of U.S. (outside Cincinnati) 0.10% 0.50% 1.00% 1.50% 2.00%TOTAL SHARE OF U.S. MARKET 0.39% 0.79% 1.28% 1.78% 2.27%

2001 2002 2003 2004 2005Net revenue allocated to KPE 15% 15% 15% 15% 15%

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The KPE will pay for itself in less than two years. The first year commitment of $40-45 million initiates a business that yields about $575 million incremental net revenue in Year 5.

KPE Economic Analysis

2001 2002 2003 2004 2005All f igures in $millions

Communicatons Services Revenue 11 34 79 138 230 Content Services Revenue 26 81 187 304 426

Gross Revenue 37 115 266 442 655 Cost of Sales 0% (assume these costs allocated to CBI, BWC, etc.)

Revenue Before Expenses 37 115 266 442 655 Cummulative Revenue 152 418 860 1,515

Systems cost (fixed) 10 10 10 Systems cost (variable) 30 40 50

Hardware cost 15 10 10 5 5 Software Licenses 5 2 2 2 2

Operating expenses 13 15 18 20 23 Total expenses 43 37 70 67 80

Earnings (6) 78 196 375 576 Interest on Working Capital 15% (6) (8) 0

Net (13) 70 196 375 576 Cumulative Net Revenue (13) 57 266 571 951

Break-even analysis

-200.00400.00600.00800.00

1,000.001,200.001,400.001,600.00

2001 2002 2003 2004 2005

Year

Mill

ion

$

Cumulative costsCumulative revenues

Analysis assumes an increasing take of the national market share of 0.5% annually with a 2% cumulative take by year five.

The Cumulative Net Revenue shows a break even during Year 2 (20xx) and substantial investment returns in each year thereafter.

The NPV of this project assuming 15% annual discount and no terminal value after year 5 is $671 million.

ROI: After 3 years a total investment of $150 million has generated revenue of $418 million.

ROI: After 5 years, investment totals $297 million generating revenue totaling $1515 million.

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Key Points Several conclusions can be drawn regarding the Killer Platform Engine (KPE).




provider, it should enhance its OSS capabilities now. Next Generation services must be supported by end-to-end process management rather

than individual silos of OSS functionality. The BRW Killer Platform requires a Killer Platform Engine to reach full potential. The KPE redefines the customer experience for Next Generation services by meeting the

diverse needs of content / services vendors, access network operators and end-users. The KPE provides operational capabilities, including a “single view” of the customer, needed

for Next Generation services and improves productivity of existing business functions.

The KPE will drive accelerated revenue growth for the Killer Platform.

An investment in the KPE will generate substantial returns and is a critical step in Broadwing’s development as a Next Generation Tier 1 service provider.

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If We Agree That …

The Killer Platform is missing the Killer Platform Engine (KPE).

Broadwing needs the KPE to be a dominant global player in the Next Generation services market.

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Recommendations

Augmenting the Killer Platform with the OSS capabilities of the KPE, to provide a superior customer experience and to provide the support for accelerated revenue growth.

Next Steps for CBI and for BW:– Develop an action plan for Cincinnati Bell focusing on support for

next generation services. This plan should provide for a single view of customers, including an integrated billing system, and will include plans for migrating legacy services into the KPE environment.

– At Broadwing, begin by providing KPE capabilities for the hosting platform. Use the KPE to integrate the data center and network offerings.

– Identify and begin discussions with potential Network Access Partners as a first step toward a full national retail roll-out of the Killer Platform.

Then We Recommend …

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CBI OSS Needs – Details

Appendix

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Maintain high quality service to the historical customer base by updating current provisioning systems to support existing circuit-switched voice services.

– Immediate replacement is needed for CBT’s provisioning system, due to operating platform and excessive pricing of maintenance contract. Maintenance will become unavailable within 2 years. Replacement will take at least 12 months. Timing to start project is critical.

– Other “near replacement” CBT systems can be delayed for the foreseeable future including LMOS (POTS trouble repair / testing), OS Plant and OS Connector (outside plant facilities records systems).

Update the CBI billing processes:– CRIS, the 25 year-old billing system supporting the bulk of CB’s current customer

base, is expensive to maintain and lacks many features / functions necessary for supporting business customers. This system requires immediate attention to address the needs of CBI’s targeted customer segment. The system is inflexible and difficult to add new products/services (I.e. product bundling, discounting)

– Consolidate the multi-system billing process that supports each of the wireless, wireline (customer-facing and carrier-facing) and long-distance services segments to a smaller number of systems. This will minimize errors and provide added flexibility for addressing customer needs.

– Deliver a combined billing platform for improving the customer’s view and payment of billing details and to reduce write-off's caused by manual data association errors.

The OSS challenges for CBI center around three functional areas to provide better customer support. They include provisioning, billing, and a “single view” of the customer’s service data.

CBI Challenges

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Improve the end-user customer experience by offering a “Single-View” of the customer service profile for up-selling CBI services:

– Establish an integrated view of customer data for all traditional product lines including wireline, wireless, data and directory services

– Blend internal services data with information necessary for addressing new services offered in conjunction with other partners

– Improve data integrity across systems, e.g. customer care and billing applications to allow single-entry of information for minimizing manual input errors

– Support new business opportunities and offer new technology-enabled services without adding a new suite of ordering, provisioning and billing applications for each opportunity or service.

The OSS challenges for CBI center around three functional areas to provide better customer support. They include provisioning, billing, and a “single view” of the customer’s service data.

CBI Challenges

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Maintain high quality service to the historical customer base by updating current provisioning systems to support existing circuit-switched voice services.

Provide “superior customer experiences”– Integrated and updated billing processes– A “single view” of customer information

The greatest operations challenges facing CBI can be addressed by the Killer Platform Engine

Implement a KPE that provides a process-enabled OSS environment for integrating existing systems and processes with new applications.

Implement a KPE that delivers an integrated view of customer data (customer, services, network, billing) through a process-enabled OSS architecture that can link existing systems with new applications.

CBI Challenge Resolution

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Documents

Killer Platform Engine Business Strategy and Economic ...docs4sale.com/img/products/uploads/jgal5a_Broadwing...The Killer Platform Engine will enable BRW to meet its business needs