2013 Business Transformation Roadshow

1 © 2013 Calix – Proprietary and Confidential

The information contained in this presentation is not a commitment, promise, or legal obligation to deliver any material, code, or functionality. The development, release, and timing of any features or functionality described for our products remain at our sole discretion.

2013 Business Transformation Roadshow


The Leader in Access Innovation

The world’s largest telecommunications systems vendor focused solely on access

Innovative. Global. Focused. A Unified Access portfolio: Industry leading fiber and copper solutions

The leader in advanced broadband access North American leader in broadband access revenue* Top 3 global vendor: Fiber access revenues* A record of industry leadership and innovation

Industry’s broadest access portfolio Fiber: Leading solutions enable transition to gigabit services TODAY Copper: Advanced VDSL2 solutions extend copper network longevity

Trusted partner Over 1150 customers worldwide, including some of the world’s largest and most respected communications service providers Financially strong. No debt. Cash generating. (NYSE: CALX)

Simplicity. Connected. Everywhere.

*Infonetics Research Q4 Broadband Aggregation Report – 2011 Revenue (published 2/2012)


Strategic Focus: The Access Network The rise of the consumer … and the cloud

Access

The Cloud

Content Subscriber


US ILECs Deploying FTTP North America MSAP Market Share Leader in US Fiber-to-the-Premises (FTTP) deployments

#1 market share in North American multiservice access platforms

North American Access Leadership

446

243

0

50

100

150

200

250

300

All Other Vendors

(Broadband Communities, April 2012)

North American Access Leadership

(Infonetics, February 2012)

350

400


Financial Summary Q1 2013 and FY 2012 Metrics

Q1 2013 key metrics

Net income (non-GAAP): $3.2M Cash: $48.1M

Up $1.1M vs. Q4 2012

2012 Cash Flow from Operations: $27.7M No debt

Q1 2013 Q1 ‘12 vs. Q1 ‘13 FY 2012 Revenue $90.5M Up 15% $330.2M


Calix and Ericsson Announce Global Partnership Completion of acquisition and global reseller agreement announced 11/5/2012

Calix and Ericsson began a definitive agreement under which Calix acquired Ericsson's EDA 1500 GPON assets

Acquisition brings together: Ericsson EDA 1500 GPON solution – A proven high capacity GPON solution deployed by many of the world’s largest carriers A complementary ONT portfolio, an element management system, and other assets The Calix Unified Access portfolio – North America's leading access portfolio

Calix and Ericsson strategic partnership to bring Calix Unified Access systems and software to the world

Companies also entered into a global reseller agreement where: Calix has become Ericsson's preferred global partner for fiber and VDSL2 access Ericsson will sell Calix Unified Access systems and software as its preferred broadband access solution in 180 countries.


The information contained in this presentation is not a commitment, promise, or legal obligation to deliver any material, code, or functionality. The development, release, and timing of any features or functionality described for our products remain at our sole discretion.

Customer Service Snapshot

2013

8 © 2013 Calix – Proprietary and Confidential 8 8

Topics

Enabling Customer Success

What’s Coming in 2013?


Enable and Invest in Customer Success

Customer Services focuses on: Customer satisfaction

Direct support for 1,100 communication service providers Customers rate Calix technical support at 9.1 or higher over last 5 years Process-driven culture for consistent and repeatable levels of service

Simple business model – no hidden costs Only one recurring fee – Calix Advantage Program (CAP) – covers everything CAP: CMS Element management; Software upgrades; Technical support

Test and assure solutions through Calix Compatible Lab

Knowledge transfer through the Resource Center

Our goal: reduce Total Cost of Ownership (TCO) of Calix systems


Investing in CAP for Your Success

Calix Service Station Launched July 2012 Faster case resolution time Real-time case update alerts 360-degree account view More efficient self service

Beacon Launched May 2012 Monthly email newsletter Proactive support news Promotes resources available to you Expands breadth of information

2012 Investments in Calix Advantage Program Technical Support


Investing in CAP for Your Success

Training Webinars Launched Q4 2012 For CAP customers only Detailed training, not overviews Focused on applications

Apr 23: “Increasing CLI effectiveness in E7” May 21: “CMS 12.0 and B6, 7.3 Integration”

Video Knowledge Base Launched 2012 “How-to” instructional videos Show, don’t tell Brief, focused topics Search on ‘videokb’ for full library

2012 Investments in Calix Advantage Program Technical Support


TAC Training Program Enhanced 2012 Manager hired to lead Sophisticated lab dedicated to internal training Learning Management System to track training & skills More modular and hands-on content

Dallas Support Office Expanded 2012 Doubled in size to support up to 45 engineers Added customer training facilities Enhanced lab with additional equipment

Investing in CAP for Your Success 2012 Investments in Calix Advantage Program Technical Support


What’s Coming in 2013?


Calix Mobile Apps

QR Code Reader App Calix QR Code Reader App

RMA returns scanner (works with Service Station App!) Access value added content everywhere

Service Station App Untethered access to Calix support Access Calix support from everywhere Standards-based mobile app

Built on Salesforce Touch platform HTML5, works on all mobile devices


2013 Preview: Best Practices Docs

Index of reference designs Think small: very granular use cases

Gets complicated quickly, otherwise Each use case links to a best practice doc

Visually oriented Illustrated designs (show don’t tell) Easy identification of applicability

Best Practices Quick Tip format: deep & brief!

Each is a single use case Small, digestible (no “ocean-boiling”) Regular cadence (~monthly)

Master ‘Reference Designs’ Doc


All the ways Calix can help you win

Calix Advantage: One simple fee for entire installed base Calix Technical Support: Highly rated, available when you need it Calix Resource Center: Self-service support on the web Calix Community: Information sharing, problem solving, networking Calix Training: Multiple methods of knowledge transfer Calix Certification Program: Training and accountability Calix Professional Services: Expert implementation resources


Topics

I. Business Transformation

II. Enabling the New Broadband Experience Know the subscriber Services and support Residential gateway Monetizing the experience

III. Network Transformation New solutions for fiber forward Unlocking your copper assets

IV. Embrace the Future


Airlines: Transformation Case Study


US Airline Industry Deregulated in 1978 Impact on prices and carrier revenue

US Airline Deregulation Markets were no longer restricted and competition intensified As prices drop, carriers incur revenue losses

Same Result! 1975 1980 1985 1990 1995 2000

160 140 120 100 80 60 40 20 0

Average Domestic Airfare

| | | | | | | |

| | | | |

Canada

United States

U.S., Canadian 1983 dollars

Source: U.S. Bureau of Transportation Studies, U.S. Bureau of Labor Statistics,

Canada Aviation Statistics Centre, Bank of Canada Review.

(regulated*)

(deregulated)

* Canada deregulated 10 years after the US

FCC Telecom Regulatory Order Subsidies are reduced and competition intensifies Grants, loans harder to access as carriers incur revenue losses


Software Critical To The Transformation

REDUCE COSTS 1

INCREASE REVENUES 2

Transactional software and web apps capture customer data

Self-serve Reservations Seat assignments Baggage check Check-in

On-board “automation” Order meals on-screen No cash accepted

Self-service and Automation

Preference fees Book early or Day-of-week Seating (exit row, aisle) Checked bags Blankets, pillows

One-time usage fees Lounge use Preferred early boarding

Behavior-based services

1 allows capture of data to help create services in 2


As convenient as a bus

Fly to secondary airports

Use single aircraft, single configuration

Fly routes under 3 hours so no meals to serve

No assigned seats

No fees for bags or reservation changes

Low-cost Disruptive Business Model Example of “clean-sheet” approach in Airlines


Google Fiber Disruptive Business Model Example of “clean-sheet” approach in Telecom


Failure. Many airlines launched subsidiaries with lower-cost operations

Airlines Responded: New Business Models

Success. Outsource feeder traffic to regional airlines

Flight connection service brand under which 12 individually owned regional airlines operate short and medium haul feeder flights.

Mixed results adjusting existing model; New thinking worked better

New business models can lead to higher margins and are more sustainable than product innovation alone


Airline Success Story 2013 projected to be a banner year

Record financial performance Record profits: $6.3B

Every domestic airline projected to be profitable in 2013

Record revenues: $145B (3rd year in a row) Record performance in spite of significant challenge

Jet fuel price at record high 370% more than 10 years ago Cost of fuel has increased from 11% of operating costs to 35% in 10 years

Capacity has remained relatively constant over last decade Distance, however, has increased 18%


Key Principles in Transformation

Data

Value Marketing

Know customer and their aspirations

Convenience. Self-service. Automation.

Simplify. Contrast.

Personalize.

“Seize the data”


Topics






Software to Optimize Your Broadband Business


Compass Software Overview

Software-as-a-Service Benefits No upfront infrastructure costs Quick start: Web-based, hosted service Low monthly service fee

Compass Product offering Flow Analyze (today) Consumer Connect (today) Command Center (2013) Future applications will target:

Service level assurance Analytics and action reporting

Network Operations

Center

Internet Application

Server


$

Compass Flow Analyze Knowing subscriber bandwidth usage opens new revenue opportunities

Identify new REVENUE opportunities

Targeted service up-sell opportunities In-home network services

Increase SUBSCRIBER satisfaction Diagnosis and troubleshooting of services Identification of malware infected machines

Optimize NETWORK resources Understand sources of bandwidth demand Well informed network capacity upgrades

Reduce COST of delivering services More efficient network operation Scale service offering

http://images.google.com/imgres?imgurl=http://www.supinfo-projects.com/2006/voip_perf_analysis_fr/voip_logo.gif&imgrefurl=http://www.supinfo-projects.com/fr/2006/voip_perf_analysis_fr/&h=227&w=500&sz=20&hl=en&start=3&um=1&tbnid=KMJdWOLFPPOqrM:&tbnh=59&tbnw=130&prev=


Upsell and Service Expansion to increase ARPU Identify New Revenue Opportunities

“In Disguise” A Business with Residential Service


Match services to usage patterns Offer The Right Service

Proactive Marketing Identify subscribers that frequently “hit the ceiling”

Data Sources Flow Analyze Service information (csv file)

Reactive Selling Bandwidth consumption (bps) for specific subscriber

Data Sources Flow Analyze Service information (csv file)

Average Rate Trend

01 02 03 04 05 06 07 08 09 10 11 12 13 14 16 17 18

Ave

rage

Rat

e (K

bps)

Day of Month

Down Up


Increase Customer Satisfaction e.g. Diagnose a common customer frustration caused by BitTorrent

Clue #1: User connected to many endpoints at locations around the world

Clue #2: Scrambled port numbers for monitored endpoints (BitTorrent randomized port numbers)

Clue #3: Traffic is asymmetrical

File Sharing

Spammer

No guesswork. See problems when they are occurring Comprehensive activity view: Real time and recorded


Know Your Customers Harvest your access network for information about subscriber needs

Offer new services based on recognition Anticipate and address subscribers needs

Residential services subscriber potential Monetize excessive bandwidth users Offer the right speeds to customers Identify promotional and service bundle opportunities

Small Business potential Business ‘masked’ as residential: identify and up-sell Know the ‘hot-spots’ Value add components to service offering


New Broadband Services and Support

Enabling the New Broadband Experience


Consumer Connect

Extends your access network to the subscriber device Reduce customer churn

Address service issues with visibility into the subscriber’s devices

Simplify broadband device management to lower OPEX Remote device and service maintenance Centralized firmware management

Develop new IT service revenues Wi-Fi management Content filtering Firewall settings

A tool for device connectivity and management


Installation Simplified

Reduce or eliminate truck rolls for new installs

Drop ship residential gateway

Pre-configure broadband network or leverage OSS integration via XML API

Automated device registration and authentication

Custom firmware from GW supplier or DHCP options 43 and 60 sets Consumer Connect URL and credentials


Activate Home IT Services


Remote Diagnostics


Wi-Fi Maintenance


Gateway Software Maintenance


Video Allo Communications Success Story


Allo Communications Imperial, Nebraska

Challenge Bring cutting-edge broadband services to rural Nebraska without subsidies

Differentiate from incumbent telco and cable competitors in the region

Solution Build an all-fiber network with Calix C- and E-series platforms in targeted markets, focusing on business first

Use Calix software tools to more efficiently manage their network and provide excellent service

Updating 1,200 set-top boxes reduced from 2 hrs 40 minutes to 5 minutes using Consumer Connect

Allo Market Share 80% in Business

60-70% in Residential

Allo Results


Coming in 2013: Command Center Where it all comes together

Single portal controls entire broadband service lifecycle Users, devices, applications, locations Simplifies service lifecycle management Brings all Service Management software together: Compass, CMS, and integrates into 3rd Party BSS / OSS Customizable based on CSP needs, using “widgets”


Customizable dashboard for business needs

Role based security and data access

Compass Application store and useful links

Business intuition indicators

Widgets enable drill down to Apps

Google Maps integration

Entire Service Lifecycle on a single screen


Integrating Customer Prem to Backoffice Calix provides a total solution for fiber service delivery

Solution summary Remotely manage devices and services in the home Enables new home I.T. services using “virtual technician” Improves consumer satisfaction and reduces OPEX Consumer Connect for services management, CMS for provisioning

TR-69

OSS / BSS


Topics






836GE RSG and the Home Network

Enabling the New Broadband Experience


836GE RSG Feature Update Integrated 700GE ONT, home gateway and Wi-Fi

Complete digital home solution AE and GPON auto-detect ONT

4 GE, 2 POTS GE ports separately provisioned or bridged to support whole home DVR

Embedded Home Gateway

802.11n with internal 2x2 antennas Wi-Fi Alliance certified 2.4 GHz or 5 GHz selectable MIMO spatial diversity WPS push-button support Support for 4 SSIDs

USB port for future use


Wireless Menu Consumers or service provider can configure wireless


ONT and Residential Gateway partition 836GE RSG Architecture

ONT Partition ONT Management Subscriber Services Voice Services

Gateway Partition Local and wireless network Residential Gateway services Management using TR-069 client

In-home devices with TR-069 clients


Soon available on all 700GE ONTs via download 700GE ONT Home Gateway

ONT Partition ONT Management Subscriber Services Voice Services

Gateway Partition Local network Residential Gateway services Management using TR-069 client

In-home devices with TR-069 clients


#1 Internet and Voice Connectivity

OTT Media Player

VoIP Switch

POTS

836GE RSG

Access network provisioned by CMS ONT is configured for data and voice services. Voice services managed independent of Res. Gateway data services Bandwidth policy administered by network router, BRAS (PPPoE), or ONT

Desktop Computer

Laptop Computer

Home Monitoring

Direct wiring of home network with no set tops

E7 OLT Router

IP Cloud


#2 Wireless Home Connectivity

Residential Gateway will default with SSID 1 enabled Support of Inter- and Intra-SSID communication 32 clients maximum per SSID All clients able to communicate to LAN ports

All internet services over 802.11n Wi-Fi

SSID 1 (RSG default)

SSID 2-4 (Guest Access)

E7 OLT

Desktop Computer

Home Monitoring

Laptop Computer

Media Player

836GE RSG

Router

IP Cloud


#3 Mixed Bridged and Routed Services Digital Video Recorder

Media Player

IPTV services using bridged Ethernet ports

Video traffic is isolated from High Speed Internet traffic Support of multicast VLAN registration (MVR) on bridged ports Support of Whole Home Networking for video services

Video Servers

DHCP Servers

Desktop Computer

Router E7 OLT

IP Cloud

Light Set-top Box

836GE RSG

Set-top Box


#4 Whole Home Video Connectivity

IPTV services over the Residential Gateway interface Connectivity of video services and in-home devices Streaming media content for PC clients stored on DVR Consumer applications to the cloud

Desktop Computer

Switch

Media Player

Microsoft Mediaroom using routed Ethernet with media content sharing

Video Servers

Router E7 OLT

IP Cloud

836GE RSG

Digital Media Server

Light Set-top Box

Digital Video Recorder Set-top Box


Premises Transformation

The Emergence of Carrier Class Wi-Fi Changes the Business Model


Carrier Grade Wi-Fi

Today: Hybrid Wi-Fi and Ethernet 836GE RSG supports data and video streaming, but not linear broadcast IPTV IPTV requires dedicated devices at 5 GHz now marketed by set top vendors for book ended IPTV solution

Future: “Carrier Grade Wi-Fi” Requires 802.11ac standard with beam forming Required for support of linear broadcast IPTV

Eliminates wiring for IPTV service

Interoperable, commercial deployments starting in 2014

Home Networking Evolution


Transitioning to Carrier Class Wi-Fi Set-top box interoperability will be key

Interoperable Carrier Class Wi-Fi is not here yet Vendors now have standalone 5 Ghz devices paired with their set-tops

These subtend from a 700GE or 800GE

Calix is incorporating the same technology as set top vendors’ bookended devices in future Residential Service Gateway devices

An interoperable carrier grade Wi-Fi experience

Calix is working with major set top vendors on Wi-Fi interop

Today Future

2.4 GHz

5.0 GHz

2.4 and 5.0 GHz

High Speed Data

IPTV

High Speed Data

IPTV


Rear

In-Home Wi-Fi Benchmarking Tests Upper Floor Coverage Front

77 81 104 289

58 51 102 290

35 No Comm

85 267

55 14 104 290

79 48 100 291

71 70 103 290

67 46 74 291

66 59 48 290

Not Measured No Comm

60 270 Not Measured

101 56 290

Access Point Two Floors Below

Access Point (AP)

Rear

Front

3,700 sq ft, 3-story home AP placed in corner of lowest level

Results: Minimum Rates 2x2 @ 2.4 GHz = 35 Mbps (zero No-Comm.) 2x2 @ 5 GHz = 14 Mbps (two No-Comm.) 3x3 @ 5 GHz = 48 Mbps (Carrier Class) BF 4x4 @ 5 GHz = 255 Mbps (Carrier Class+)BF


“Show me the money!”

Monetizing the Experience


US Home Automation Market 2011-2016

2011 2016

4,000

3,000

2,000

1,000

0

$5.5B

$3.4B

Security

Energy

Lighting, Climate, Entertainment

Which monitoring service are you likely to use?

72%

70%

56% ABI Research

Security, Lighting and Entertainment

Energy and Heating, Ventilation and A/C

U.S. broadband households extremely satisfied with broadband service

All broadband households Premium tech support

Online file/data backup Home network router

Extra warranties Parental controls

Antivirus/Internet software Home security

Home monitoring

Percentage of Respondents 50% 80%

BCC Research, 2012

62%

How Value-added Services Affect Customer Satisfaction

$ Millions


Source Components Monitoring Installation Billing

Service provider (Best Buy, Costco, specialty distributor)

1. Service provider 2. Subscriber

1. Existing techs 2. Local contractor

Direct - on existing subscriber bill

Aggregator, bundler (e.g. Clear2There)

1. Service provider 2. Cloud-based 3. Subscriber

1. Existing techs 2. Local contractor

Direct - on existing subscriber bill

Outsource to industry expert (ADT, Brinks, etc)

Outsource Outsource Outsource or direct, with mutual revenue share

E.g. Entering the Automation Market A range of options exist for the service provider


Available bundles from component supplier*

Typical Automation Component Packages Service provider’s

subscriber packages

*

Video Package - One time equipment fee $199

Starter Package - One time equipment fee $89


Home Automation Delivered Subscriber Automation Dashboard

Notifications Profiles

Live Video

Arm System Locks

Thermostat Switches Help Corner

http://www.apple.com/ipad/built-in-apps/videos.html


Network Transformation

New Solutions for Fiber Forward


The Economics of Fiber

Fiber deployments average 63% take rates Even in CLEC areas, market share with fiber is 55%

Source: RVA Survey of 300 FTTH operators, 2012

PON makes more money over time

All cases make money

PON HFC VDSL

PON HFC VDSL

Significant OPEX savings over time

Assumes 35% take rate

Year 4

Year 3

* Economics of Fiber, Corning

Architecture Comparison on Net Income PON, HFC, VDSL

Architecture Comparison on OPEX PON, HFC, VDSL

Effect of Initial Penetration Rate on Net Income PON Network

1 2

3

Over 15 yrs PON saves $31M over VDSL

Fiber enables market share gains

PON 50% PON 35% PON 20%

Take Rates

Year

Year


Fiber Customer Satisfaction % of customers “very satisfied”

$2.64

$3.68

$6.44

$15.28

$17.64

0 5 10 15 20

FTTH

Cable Modem

FTTN (VDSL2)

DSL (ADSL2+)

Wireless

Consumer Cost per Megabit Fiber gives you a clear

value proposition

Cable modem

FTTN (VDSL2)

DSL (ADSL2+)

FTTH

Wireless

65%

61%

60%

55%

47%

44%

35%

34%

32%

24%

0% 20% 40% 60% 80% 100%

Service uptime

ownload speed

Upload Speed

stancy of speed

reaming quality

FTTH

*Source: RVA survey of 2,000 homes, 2012

Service uptime

Download speed

Upload speed

Consistency of speed

Streaming quality

FTTH Other Broadband


Fiber Enables Flexible Service Offerings Generate more revenue per subscriber (ARPU)

From 1 Mbps to 5 Mbps Or from 5 Mbps to10 Mbps

You’ve been upgraded FREE for 30-days!

Offer If you decide you can’t live without the increased speed, call us and we’ll upgrade your package. Do so by January 31, 2011 and receive FREE equipment, FREE installation and FREE activation!

Dakota Central TELECOMMUNICATIONS


E7-2 GPON-8 available with Release 2.2 in July 2013 High Density Residential GPON Services

8-GPON, 4-GE/2.5GE interfaces, 2-10GE SFP+ 512 Subscribers per card, 1024 per E7-2 shelf (64:1 split) GE interfaces for high value business and residential subscribers Flexible deployment options

Designed for CO and RT deployments Integrated 10GE transport and Modular Chassis expansion Protocol flexibility with Link Aggregation, RSTP and ERPS

4 SFP Ports (GE / 2.5GE)

2 SFP+ ports (GE / 10GE)

8 GPON Ports (2.5G)


Available with the 7.3 - released in March 2013 Expanded VoIP Support for B6 GPON

Addition of SIP VoIP on the 700GEs B6 GPON voice flexibility with support of SIP, MGCP, or GR303

Video

Voice

Data

Metaswitch C15

GR303


Support for 726GE-I on B6 in 7.3 - released in March 2013

RF to IPTV Transition

Deploy RF video services inside the home

2 POTS, 4 GE, 1 RF

Deploy ONT near indoor cable entry

Lower OPEX: Ease of deployment Lower cost

Migrate to IPTV on your own terms, on your own timeline

PC IP TV

iPod

Phone

GPON

Bridge

TV + IPTV STB

IP TV

10GE Ethernet Network


Support for 726GE-I on C7 in Release 8.0MX in June 2013

RF to IPTV Transition

Deploy RF video services inside the home

2 POTS, 4 GE, 1 RF

Deploy ONT near indoor cable entry

Lower OPEX: Ease of deployment Lower cost

Migrate to IPTV on your own terms, on your own timeline

PC IP TV

iPod

Phone

GPON

Bridge

TV + IPTV STB

IP TV

10GE Ethernet Network


Expanding home networking functionality of the 700GEs Premises Focus: In-Home Networking

Full Bridge and Home Gateway support Home Gateway software download Enable Whole Home DVR with ONT Full Bridge Support for both indoor and outdoor 700GE ONT solutions New HPNA ONTs

Ethernet (700GE ONT)

Ethernet and HPNA (712GE / 722GE)


2013 Fiber Premises Releases

836GE RSG (E7 AE Available, E7 GPON July 2013) Auto-detect GPON and Pt-to-Pt GE ONT Home Gateway 802.11n Wi-Fi, selectable 2.4 or 5.0 GHz 2X2 MIMO internal antennas

AE 3.0 (released in March 2013) 836GE RSG support 700GE Ethernet bridging for whole home DVR

712GE / 722GE HPNA (E7 GPON July 2013) HPNA 3.1, 2GE, 2 POTS

Home Gateway software download to 700GEs (E7 GPON July 2013)

Includes all indoor and outdoor 700GEs Layer 3 Home Gateway and Ethernet bridge for whole home DVR

74xGE ONT (E7 GPON July 2013) Business class services Ethernet OAM, GE ports, POTS, T1 / PWE3 options


Video Hiawatha Broadband Success Story

http://hbci.com/


Example: Hiawatha Broadband Regional fiber over-builder – Southeast Minnesota

Brand based on customer experience

Unrivaled technology, customer experience (gigabit speeds) Outstanding service Community involvement, economic development 50%-70%+ take rate in each community served

Expanding the model Speed range from 120 Mbps to 1 Gbps <3 year payback in each community served HBC Wizards (technology support) Flow Analyze drives support, planning, marketing Project Ignite (Red Wing) Training courses with local colleges

Service Provider Experience Provider

http://hbci.com/


Network Transformation

Unlocking Your Copper Assets


VDSL2: A Transition Technology

VDSL2 provides a short term solution for bandwidth needs

After 2020 average peak period consumer bandwidths will exceed the capacity of VDSL2

VDSL2 Fiber ADSL/2/2+ 1.5-3 Mbps 8-24 Mbps

50 Mbps

100 Mbps

500 Mbps

Bon

ding

Vect

orin

g

Competitive Battleground (today)


Calix C7 8.0 VDSL2 Innovation

Profile enhancements 5-band support

Profiles 8, 12, 17 No bandwidth cap in 5-band mode

VDSL2 bonding Rate and reach increase for VDSL2 deployments

ADSL2+ PTM bonding Up to 12.8% improvement in throughput relative to ADSL2+ ATM bonding


B6: Benefits of B6-256 More than just short loops

VDSL2 Combo for B6 ESAN Supports all DSL deployments with ADSL2+ fallback Increases line performance using PTM Extends service reach with bonding: VDSL2 and ADSL PTM Enables deployment flexibility through any-to-any bonding

Flexible uplink options for B6 ESAN 4 SFP+ 10GE or GE uplink ports


E7-2 High Capacity VDSL2 Line Cards

VDSL2-48 Combo (residential / business) VDSL2 with ADSL2+ fallback 96 combo ports / 1RU (48 ports per card) with integrated voice Bonding support for VDSL2 / ADSL2+ with PTM

VDSL2-48 Overlay (residential / business) VDSL2-48 dual-slot line card with ADSL2+ fallback 48 ports / 1RU with overlay voice via integrated POTS splitters Bonding support for VDSL2 / ADSL2+ with PTM


E3-48 Sealed ESAN – VDSL2 Vectoring

Sealed, high density VDSL2 Hardened, 48 ports - ideal for low density, remote, and MDU locations

E3-48 overlay available today E3-48C combo available in July 2013 AC, DC and remote power options

VDSL2 with ADSL2+ fallback and bonding Two 10GE SFP+ ports and four GE / 2.5GE SFP ports

Uplinks / downlinks Daisy chain, ring, star topologies supported

Operational efficiency Installation, serviceability, management

Architecture and software based on mature E-Series product line

E3-48 ESAN


VDSL2 Applications Brownfield (up to 7 kft)

Deployments often served from existing cabinets

Density designed to serve high subscriber counts, or subscribers geographically dispersed (multiple binders)

Mix of short and long loops

Opportunities to improve bandwidth

Bonding on loops longer than 3Kft

Vectoring can benefit on loops under 3 kft

Shorten copper loops by extending fiber

9 kft

Vectoring from a cabinet can provide benefits on short brownfield loops

1-3 kft

Bonding opportunity for loops >3 kft

1-3 kft

1-3 kft

1-3 kft

1-3 kft


0

10

20

30

40

50

60

70

80

90

100

300 600 900 1200 1600 2000 2400 2800 3200 3600 4000

VDSL2 Performance

Ban

dwid

th (M

bps)

Loop Length (ft)

0

10

20

30

40

50

60

70

80

90

100

300 600 900 1200 1600 2000 2400 2800 3200 3600 40000

10

20

30

40

50

60

70

80

90

100

300 600 900 1200 1600 2000 2400 2800 3200 3600 4000

24 pairs - vectored

24 pairs – no vectoring

Up to 90% recovery of “lost” bandwidth

Single pair – no disturbers


VDSL2 Applications Greenfield (1-3 kft)

Can justify FTTH or VDSL2

Short copper loops so bandwidth is optimized

Vectoring good up to ~3kft

1-3 kft


VDSL2 Deployment Challenges

VDSL2 is a beneficial technology…but real-world deployment challenges exist

Age of copper plant – may require maintenance upgrade Old splices, bad pairs, water, etc.

Bonding yields rate and reach benefits if pairs are available Pairs may not be plentiful enough in some areas to allow for wide use of bonding

Interferers and ADSL2+ loops reduce benefit of vectoring May require labor intensive binder grooming, plant and record management

Vectoring of little benefit on longer loops Bandwidths fall to ADSL2+ and below levels


Designed for OSP transformation ODC-100: Simplify Copper to Fiber Migration

Copper Optimized Fiber Optimized Mixed Copper/Fiber

Start with copper • Deploy high density

VDSL2, with ADSL2+ fallback

• Supports POTS cross-connect and protector panel

Evolve to fiber • E7-2 modular chassis

allows migration to point-to-point GE (Active Ethernet) or GPON

• Supports fiber patch panel and splitter panel


Coming inflection points

Embrace the Future: Network Collapse


Emerging Scenarios for Service Providers

The “Pivot” Scenario Overbuild adjacent territories for scale

Driven by realities of new regulatory environment Focused on fiber Leverage existing assets

The “Step-It-Up” Scenario Complement existing copper and fiber assets to stay competitive

Driven by advent of DOCSIS 3.0 and advanced LTE Leverages new technologies like bonding and vectoring Provides for strategic upgrades to fiber where and when appropriate

The “CAF+” Scenario Address CAF 4/1 requirements while strategically planning for the future

Uses tactical tools like sealed units to meet today’s CAF requirements Anticipates expanding requirements in the future, with efficient path to fiber May be complementary to “Pivot” scenario


Deploy broadband and fiber deep into the network

The Mission: Network Transformation

Residence

SMB

MDU

The Cloud

Remote Terminals

Remote Nodes

Neighborhood Service Area

Mobile Backhaul

Content Subscriber

Copper: VDSL2/POTS

Copper: VDSL2/POTS

Copper: VDSL2/POTS

Data Center

COs

Region

Copper: VDSL2/POTS


Network Convergence – residential and business mobility Enabling Next Generation Applications

Residence

SMB

The Cloud

Content

Residential Network

Business Network

Converged Service Delivery Network

Subscriber Apps.

Access Network


Region

Data Center


Software Convergence – efficiency, intelligence, automation Enabling Next Generation Applications

The Cloud

Content Subscriber Apps.

Access Network Apps.

Residence

Mobile Backhaul

SMB

MDU

Software as a Service

Application Aware

Device and User Aware

Service Usage Aware

Location Aware

Market Intelligence

Data Center


Region


Your Goal: Achieved Most relevant services – Lowest installed CAPEX – Lowest ongoing OPEX

The Cloud

Access

Mobile Backhaul

Home / Office

MDU

SMB

Simplified.

Connected.

Everywhere.

Content Subscriber

Data Center


A Vision of the Service Provider Business transformation built on network transformation

Organization behaves in a new way Built around subscriber experience

Transformation requirements Data Know your subscribers Value Personalize on subscriber needs Marketing Simplify the subscriber experience

Subscribers are already telling you what they need – You now have the tools to listen

What are your subscribers telling you?

Broadband

Marketing

Customer Service

Plant and Engineering

Operations and Administration

Experience


MSO

DBS

Tomorrow

CLEC

YOU

Today

MSO

DBS CLEC

YOU

The Experience Provider Creates differentiation and separation from the competition

Network transformation delivers a superior services envelop Business transformation enables new service options A superior experience drives a wedge between you and competitors

Listen to your subscribers – they’ll show you the way

In 2013 we’re returning to the Wynn in Las Vegas

Stay tuned for more details coming soon!

2013 Business Transformation Roadshow

Documents

Transcript of 2013 Business Transformation Roadshow