1 Next Generation InfrastructureJuniper Networks Next Generation Infrastructure The City of the Future John McEntee

2 The Smart City Opportunity

3 The Smart City ImperativeUrbanization Citizen Expectations Economic Competition What’s driving the idea of a “Smart City” forward? Here are the key forces: Increased urbanization By 2030, 6 out of every 10 people in the world will live in cities. By 2050, it will be 7 out of 10. While this trend mostly driven by migrations of people from rural to urban areas in Africa and China, the % of the population living in cities in the US and most of Europe continues to rise. And this is counter-intuitive to many people who thought that the spread of the internet would push people to live and work remotely. But the trend continues and there has been a renewed understanding of the importance of proximity to innovation and of cities to economic growth (North America & Europe). More demanding citizens We’ve seen the “consumerization” of IT. Many of us are walking around with a supercomputer in our pocket connected to the internet and everyone expects all services to be on-demand and available anytime and anywhere, and often, for free. 3. Economic competition Competition is now global and cities are competing to attract people and companies. And the competition is tough: Singapore, Hong Kong, London, New York, etc. Urban revitalization efforts that make a city a better place to live and work are a part of this dynamic. And these forces put stress on the current infrastructure, which is often ageing and inadequate to deal with the congestion. Now the good news is that technology costs continue to drop and IT and connectivity are becoming pervasive. And today’s smartphones are becoming not just a “delivery platform” for services, but also a “sensor network” for smart city applications. By 2030, 6 out of every 10 people will live in cities By 2050, 7 out of every 10 Demographic transition from rural to urban Importance of cities to economic growth On-demand Anytime Anywhere Seamless . . . For free Competing for people Competing for jobs Competing for companies Urban revitalization to create economic growth, increase the tax base Stress on ageing infrastructure Source: World Bank, 2016

4 Objectives for MunicipalitiesCitizen Happiness Environmental Sustainability Economic Development Let’s first talk about what the goals are for a Municipality. Broadly speaking, we group them into 3 categories: Citizen Happiness Citizen engagement and empowerment, digital inclusivity Safety and security Livability – a good place to live Operational efficiency in delivering services Overall Livability Environmental Sustainability Ease congestions Minimize pollution Energy efficiency Clean water - Flint, Michigan, droughts 3. Economic Development Good jobs Business growth and investment Innovation – viewed as a place that fosters innovation Increase the tax base . . . City mayor and administration want votes to get re-elected. Citizen engagement/ empowerment Digital inclusivity Public safety Operational efficiency/ service delivery Ease congestion Minimize pollution Energy efficiency Clean water (Good) jobs Business growth and investment Innovation Increase tax base

5 The Problem Statement Legacy Communications InfrastructureInfrastructures are duplicated There is always a bottleneck Everyone creates their own infrastructure from fibers to networking equipment. (Like building their own road system). Leads to high prices for communities. Service complex today is physical, static, manual

6 Smart Cities Deployment ChallengesBudget IT/technology budgets flat, tax revenues undependable 2. Business Case The business case for some Smart Cities projects can be hard to quantify – sustainability, safety, etc. Now, for a government program you don’t always need to show a positive business case, but this definitely helps. Ad it gets back to the question of funding and budget. Also a question of mandate. Who should pay for smart city infrastructure? Who owns it? Who operates it? Federal, Provincial/State, City/Municipality, service providers, 3rd party… 3. Departmental silos We hear this common problem around the world about projects that might span different departments. And beyond this certainly policy decisions and politics can be part of the problem. Dallas lists 71 different departments on their website 39,044 general purpose local govts in US - municipalities, townships, counties (US Census) 4. Interoperability This relates to the problem of departmental silos. Many applications work best across different different functions – Transportation/ Parking/ Police But the larger point is that most Smart Cities efforts require that multiple vendors work together. Formal standards continue to evolve 5. Lack of IT/network expertise in the municipality 6. Moving from pilot projects to city-wide deployments 7. The problem is becoming less about collecting the data and more about how do you use it? Interdisciplinary challenge for IT leaders, one that encompasses information technology, operations and business processes – and across different departments. Determine how and when to combine operations and information technologies for maximum data insight. The "smartness" of a city depends on the ability of the different sectors to share domain-specific information, and share it in the right syntax and context so that an overall value from the different information and datasets can be generated. Smart cities need to handle information flows from a variety of sources and contextualize them. Understand where data is coming from, and determine how you're going to analyze it. The value is initially used to improve the organization and performance of city-specific networks, such as waste management, traffic patterns and transit schedules, as well as micro-generated electricity and water management. In addition, the information has a citizen-centric value, as information dissemination about traffic patterns, parking space availability or electricity pricing is also directly impacting the service needs and benefits of citizens, whether they are businesses, commuters, residents or through travelers. The perception at the other end of the value chain is critical to make city infrastructure work in a contextualized and sustainable way, linking the personalized context of citizens around safety, air quality and a standard of living to metrics on pollution through commuter traffic, highway congestion and fossil fuel plants. Balance between exploiting the data (reduce costs and/or new revenue) and privacy 8. And this ties in w/ the last challenge here of Security Cities run some very serious functions – Police, Fire, Utilities. Utilities attack in Ukraine Quantifying the Business Case Departmental Silos & Politics Budget and Mandate Interoperability Lack of Technology Expertise Pilot projects to City-wide Deployments Securing the Service Infrastructure Getting the Most out of the Data

7 Smart Cities - IoT Unit Hardware SpendingCAGR “Smart City” is an independent, alternative taxonomy defined by Gartner (subset of IoT) All categories experiencing strong growth Transport will continue to be the largest category by far for the foreseeable future Healthcare (55% CAGR) and Smart Home (35% CAGR) are the fastest growing categories 30% 16% 8% 35% 18% 16% 55% Source: Gartner, 2015

8 New Business Model is Required1 2 3 Status Quo Transformation Play 1 Play 2 Play 3 Connectivity IoT Platform IoT Solutions Given this situation what are your options? In reality, this is a fuzzy, overlapping continuum here, but we see 3 strategies that a Telco can pursue: 1. IoT Connectivity Provider Utility provider. Connectivity only. Dumb pipe. No additional value-add. Limited addressable market. Low revenue potential. Limited partnerships. BUT, low risk. Business as usual. CenturyLink – No IoT strategy. Wireline only China Mobile, China Unicom – Many connected endpoints, but less mature IoT strategy IoT Platform Ecosystem/aggregator provider Address horizontal requirements - Integrate analytics, security, cloud computing, and IT services capabilities Partner more than Build – Offer connectivity and IT management platforms "as a service" to partners And many use cases span different verticals (public safety) – SPs are well-positioned to be the broker. AT&T: Founding member of IIC VZ Thingspace DT/Qivicon connected home IoT Solution Provider Provide Managed IoT Services. End to end solutions. Build, Buy, and Partner Today, most IoT solutions are bought as separate components by the end customer and cobbled together maybe by themselves or a system integrator. So there’s an opportunity for a carrier, but. . . Challenges for the SP in Play #3: Many SPs still lack the capabilities required to offer complex IoT solutions beyond connectivity. In addition, coordinating and lining up the internal capabilities and resources, prove challenging. Lack of vertical expertise. Building applications is expensive. Need vertical sales teams. Professional services capabilities. Limited visibility into each business case. SPs not perceived as end-to-end service providers for IoT solutions; not usually considered when enterprises seek service providers' assistance in complex, end-to-end IoT implementations. AT&T Digital Life/ Connected Home VZ – M2M Professional Services; acquisitions (Hughes Telematics) Vodafone: 250 IoT people WW in 2014 (sales, marketing, tech) We think the best strategy for a carrier to pursue is some combination of Play #2 & #3. Build out an IoT Platform to serve all verticals and selectively build solutions for a limited number of specific verticals. Role Simple connectivity provider IoT network platform provider, aggregator, broker E2E solution provider Products & Services Connectivity (direct, wholesale) Connectivity, 3rd party business enablers IoT applications & solutions in select verticals Customer Ownership No end customer relationship Joint customer ownership Own the end customer, manage the end-to-end solution Key Success Factors Scale, Consolidation, Network Coverage Virtualization, Openness & Interoperability, Automation, Analytics Virtualization, Openness & Interoperability, Automation, Analytics, Services, Sales Channels Representative Examples

9 Juniper & CENGN Smart City Showcase

10 What is CENGN? … Small to Medium Enterprises AcademiaInnovation Skilled Workforce Academia Proof of Concept Testing Services Internship Training Commercialization Members & Partners Software Services Hardware Affiliations Open Standards Funding Government

11 Smart City Overlay Services Leveraging SDN/NFV TechnologiesHealthcare Retail Transportation Public Safety Security and Surveillance Logical to physical service mapping: Physical service devices (SRX Firewall, 3rd party appliance) Virtual service devices (vSRX Firewall/UTM, 3rd party virtual appliance) In-line services (NAT on vSRX or MX) SP1 Contrail Cloud Smart City Overlay: End-user provisioned on-demand services SP2 SP3 A shared infrastructure with ‘Full Operational Rights’ to each Service Provider

12 Juniper & CENGN: Smart City Infrastructure(CSO) Contrail Service Orchestrator Network Service Designer CSO Self Care Portal Admin Portal Aggregate Switches Services Internet Kiosk Phone Retail Surveillance TV Smart City Services (SP3) Service Provider 2 (SP2) Provider 1 (SP1) Pilot project in Ottawa Fibre: Physical Links Virtual Data Path Data Utility Controller (DUC) Operator View SP1 View SP2 View SP3 View DUC Portal CPE Customer Premises Equipment (CPE) Customer n Customer 1 Customer 2 Payload Switches Virtual Network Elements (VNE) Industrial Consumer and Home Healthcare Public Safety Transportation Contrail Cloud Smart City Services Juniper & CENGN: Smart City Infrastructure CENGN – Center of Excellence for Next Generation Networks (Canada) Open, Smart network So IoT solution providers can share the same physical infrastructure Multiple network slices to isolate each customer and offer services 2. VNFs running through the cloud that an end customer can use vMX as a Service Control Gateway (SCG) vSRX – firewall services, other 3rd part services Contrail Service Orchestrator (CSO) – portal, orchestrate VNFs Administration CLI: tool to manage customers Cloud CPE Tenant, Site and Service manger: manages and maps each customer’s network services to the appropriate gateway resources, e.g., the layer 2 access interfaces and routing instances. Customer portal: that enables customers to manage sites and services via graphical user interface (GUI) Network Service Designer: enables design, creation, management and configuration of the network services Network Service Orchestrator: responsible for management of life cycle of network service instances Service and Infrastructure monitor: provides information regarding status of the virtualized network functions (VNFs), virtual machines (VMs) and physical servers VNF Manager: creates VNF instances and manages their lifecycles Contrail Cloud – manage and orchestrate virtual infrastructure and VNFs https://youtu.be/-pXGCIyDApo

13 CENGN Smart City Architecture Logical ViewHealth Care Energy NG Retail Public Safety Smart City Service Overlay Blue SP Smart City Red SP Data Utility SDN Controller Infrastructure Virtual Switch Slices 1GE/10GE Switch

14 Summary: Smart Cities Need Smart Networks Key Network AttributesConsumer and Home Smart Infrastructure Security and Surveillance Open Dynamic Flexible Low Cost Secure Reliable High Performance Scalable Manageable This helps break the digital divide between wealth of citizens, increases the competition and bring the foundation for next generation society. Network High Performance Highly Secure Low Latency Highly Scalable Healthcare Transportation Retail Industrial Others

15