Mustafa Ergen Ko University 5G: Telecommunication, Intellectual - PowerPoint PPT Presentation

Mustafa Ergen Koç University 5G: Telecommunication, Intellectual Property, Entrepreneurship and Academia 2015 M.Ergen

5G... Telecommunication, Intellectual Property, Entrepreneurship and Academia Mustafa Ergen IP2016 - Istanbul @mstfrgn 2015 M.Ergen

Benchmark – Turkey and many others... ANer 1980 ANer 2000 Informa/on Economy • s/ll fragment • can do catch up the local with • not successful market with entrepreneurial to build mul/- local holdings... economy. na/onal firms. Industrial Entrepreneurial Revolu/on Economy Global firms are Before 1980 flaEening the world almost without any If not successful local barriers. to build a global monopole, local firms will be sold out. Converge to all-employee na6on . 3 2016 M.Ergen #Giri ş imciKapital

Today, dynamics... 1 2 3 Entrepreneurship Technology and Leverage of local market and resources & R&D to go full to debut. Venture Capital power and focus. mindset. 4 2016 M.Ergen #Giri ş imciKapital

Technology Entrepreneurship 1 2 3 Entrepreneurship & Venture Capital mindset... 5 2016 M.Ergen #Giri ş imciKapital

Internet Technology Entrepreneurship = Silicon Valley History Google, Facebook, Amazon, Personal Uber, .... Computers Apple, MicrosoN, Integrated Oracle, Circuits Microwaves Cisco, ... Intel, ... Test Raytheon, Equipment Vacuum Lockheed... HP... Tubes Exponen/al Growth DeForest Company Linear Growth 1956 1995 1910 Internet Gold Silicon Era Radio Era Era Rush 6 2016 M.Ergen #Giri ş imciKapital Source: Steve Blank

Synergy with academia Two universi/es – One hour drive Istanbul: More than 70 Universi/es: less than hour drive 7 2016 M.Ergen #Giri ş imciKapital

1946 46 – Inventor Lee De Forest: • Inspired his students to start companies such as HP and others. Steve Jobs of that /me • Head of Harvard Radio Lab in WW2 that innovated to beat Nazis. • Dean of Stanford when established the technopark. Vacuum Tubes > Test Equipments > Microwaves > Integrated Circuits > Personal Computer > Internet > ... First Techno Park – Stanford Research Institute Market: Hollywood > Second World War > Cold War > Consumer Electronics > Worldwide Varian HewleE- Eastman Associates Packard Kodak General Lockheed NASA Electric Corpora/on Sputnik 1 Sylvania Raychem IBM, etc.. Synergy by co-loca/on Defense 8 Source: Girişimci Kapital 2016 M.Ergen #Giri ş imciKapital

185 1853 3 – Go Gold Ru d Rush • Bought from Mexicans. aw 1872 L 1872 Law • 300 thousand people came to dig gold. • Resulted a unique employment law for California. Introduc/on of • At-Will, • NDA NCA • Synergy with diversity and employment law. 9 2016 M.Ergen #Giri ş imciKapital Source: Girişimci Kapital

Personal Computer Era Gold rush is still on... Integrated Circuit Era Gold Rush Era $60B: 2010 revenue of $40B: Apple – They introduced Annual revenue $2B: iPhone 3. of Intel. NPV of total gold dug. Synergy by empowering ordinary people: Second Renaissance 10 2016 M.Ergen #Giri ş imciKapital

Synergy from monopole power 1879 – 1982 AT&T Monopole AT&T bought Vacuum Tube patents 1996 Bell Labs -> Lucent from De Forest for $50K. 2006 Lucent -> Alcatel-Lucent 2015 Alcatel-Lucent -> Nokia Fiber Cellphone Personal Computer Opera/ng System Open Source Broadband Silicon Valley 11 2016 M.Ergen #Giri ş imciKapital Source: Girişimci Kapital

Synergy with financial industry Monopole Economy seen from Draper Cycle Warren Buffet, M&A, Wall Street, Investment VS: Venture Capital Banking, Funds, etc. PE: Private Equity • High Margin • Art • $1B to start. Mergers Leverage Acquisi/ons • Low Margin Buy-outs • CraUsmanship • $1B is low to Recession Recession start. Recession 12 Source: Girişimci Kapital 2016 M.Ergen #Giri ş imciKapital

5G Opportunity 1 2 3 Technology to go full power and debut... 13 2016 M.Ergen #Giri ş imciKapital

Mobile cellular generations DATA: 500 km/hr True Global Harmoniza/on Internet WiFi DATA: All IP Network, Convergence MIMO, OFDMA, SDR, Spectrum Sensing Voice + DATA: Perfect Roaming, Global Radio, High Speed CDMA Reuse 1 and Turbo Coding Voice: Roaming, Global, Dijital, Start of Data Low Cost DSP and FEC 0 km/hr Voice, Analog, No Roaming 1000 Mbps 0.1 Mbps 14 2016 M.Ergen #Giri ş imciKapital Source: Mobile Broadband

Data tsunami when? 5000MHz Required spectrum 16X 317MHz LTE – Advanced 500m radius – London Year Speed Popula6on Device Usage Required Capacity 2012 0.3Mbps 4984/km 2 1.2 15% 0.26Gbps/km 2 16X 4 Year 2016 2.9Mbps 5191/km 2 1.4 20% 4.2Gbps/km 2 4 Year 16X 2020 30Mbps 5477/km 2 1.7 25% 69.8Gbps/km 2 15 2016 M.Ergen #Giri ş imciKapital

Mobile operators has to redefine Change in technology and business... themselves: • either cost-cupng, • or innova/on & new markets, • otherwise consolida/on. 5G 1G 2G 3G 4G FDMA WCDMA OFDMA TDMA 16 2016 M.Ergen #Giri ş imciKapital

League of legends in telecom Korea has global Success of Korea brands. is termed as Taiwan has monopole Schumpeterian No global brands. companies. Catch Up. USA Korea China India Taiwan Japan EU They want open Korea, star/ng from China uses their local By 2020, they market and dicatate 1980, they have market advantage and decided to by WTO. US is invested short cycle use this power to make pushing monopole 6me technologies grasp rights in communica/on companies with its with government standardiza/on equipment in powerful venture game plan . ac/vi/es. house. capital. 17 2016 M.Ergen #Giri ş imciKapital

5G – Virtual layers of new communication infrastructure Mobil Access Digital Factory Smart Cars Mobile broadband Services Vertical #1 Services Vertical #2 Services Vertical-centric services (e.g., Factory of the Future) (e.g,, Automotive) Business Service Service Service Service Service Service Service Service Service Service Layer #1 #2 #3 #1 #2 #3 #1 #2 #3 Business Function Layer Northbound Interfaces Vertical #3 Vertical #1 Vertical #2 Function Function Function Repository Repository Repository Multi-service Control Opera6ng Layer System Network-centric services Network Function Layer Network SoUware Southbound Interfaces Function Repository Wireless Satellite Optical Abstract resources: Satellite Network Core Cloud Edge Cloud Edge Cloud Infrastructure Hardware Layer RAN and wireless backhaul Optical Core Network Optical Access Network Optical Metro Network 18 2016 M.Ergen #Giri ş imciKapital Source: 5G-PPP

Venture Capital investment in telecommunication – Reduced... Opportunity for indigenous scenarios... Investments Ra/o 19 2016 M.Ergen #Giri ş imciKapital Source: PWC

Turkish government intervention for mobile ecosystem: 4.5G and 5G... 2013 2015 Local 4G Base 4G Spectrum 5G Vision Sta/on Project: Auc/on • Target of public ULAK • Dictated only and private • funded over LTE-Advanced sector. $70M by Technology • Set by government. • Up to 40% government. • Target 4.5G: mandate to • R&D Resources LTE-Advanced operators for are being Technology local harmonized... procurement. 20 2016 M.Ergen #Giri ş imciKapital

4.5G entrepreneurial ecosystem & 5G Intellectual Property 1 2 3 Leverage of local market and resources Local market, local talent, local IP, local regula/ons to create synergy. 21 2016 M.Ergen #Giri ş imciKapital

5G-PPP of Europe – more than 1000 members: Research 5G-PPP is a European organiza/on to establish strategy and coordina/on to lead EU in 5G. Turkey is selected to be in the founding board (M. Ergen) via Turk Telekom. Funding total is 3.5B Euro. 22 2016 M.Ergen #Giri ş imciKapital Source: NetWorld2020

5G in the world... ITU-R Visions Group 5G-PPP 5G 5G USA ETSI 3GPP TR 5G Lab Germany at TU Dresden 5G Innova/on Centre (5GIC) at 5G University of Surrey JAPAN US 4G Americas 5G- China IMT-2020 (5G) Promo/on PPP Associa/on 5G Japan 5G Promo/on Forum KOREA Korea 5G Forum 5G Taiwan Ministry of Science and Technology, Ministry of Economic CHINA Affairs 2016: 5G-TR founded. Russia 5GRUS by Russia’s Icom- Invest 23 2016 M.Ergen #Giri ş imciKapital

Importance of patenting and Essential IPR $400 Android Phone $120 $120 Intellectual Produc/on Cost Property $50 $50 4G Patents WiFi Patents 24 Source: Intel 2016 M.Ergen #Giri ş imciKapital

4G patent map... • Ericsson Ericsson, Nokia, Huawei and Cisco are top in Essen/al IPR • ETRI FRAND list. • Freescale • Ericsson 37K patents | Huawei 36.5K patents • Huawei Fair, reasonable, non-discriminatory commitment • Innova/ve Huawei for instance in last three years, won 14K patents. Sonic • Huawei claims they hold 20% of 4G patents. • InterDigital Qualcomm asks 3.25% royalty from the sale price. • LG Qualcomm earns • Motorola around $8B per • NEC Nokia asks 1.5%. year from • Nokia These are licensing... • Nortel Ericsson asks 1.5%. subjec/ve • NSN numbers can • Qualcomm Huawei asks 1.5%. change for each • RIM customer. • Samsung ZTE asks 1%. • Sharp • TI Motorola asks 2.25%. • ZTE 25 Source: Web and verbal 2016 M.Ergen #Giri ş imciKapital