chief resources officer - telefônica...
TRANSCRIPT
Rodrigo DienstmannChief Resources Officer
São PauloMarch 15th 2016
INVESTOR DAY
VIVO RESOURCES STRATEGY
• Best mobile network experience: Value driven, high quality and data centric mobile coverage and capacity
• Superior customer experience in FTTx Ultra broadband Monetization of legacy copper with FTTC
• Provide the best TV and VoD experience in the market
• IT as strategic platform: enable digital and cloud transformation with agile, converged, simplified business systems
• Obsessive pursuit of efficiency and capital optimization
• CRM quality excellence. Digital transformation
Key LeversOperations Approach
Provide the Platforms for
Excellent Customer
Experience based on
sustainable and smart
investment choices
| 2 |
Connected Everything
Cloud Integrated
5G4G / 4.5G
3G / 3G+2G
Latency
Speeds
Density
1st Data Access MBB Revolution LTE / LTE-Advanced
Ultra speeds, low
latency, low energy –
IoT ready
300-1000ms
100Kbps
Low
100-500ms
5Mbps
Mid to High site density required
10-100ms / 10ms
10-20Mbps / 30-100Mbps
High density, small cells and indoor coverage
~1ms
1-10Gbps
Very High density
SpeedsUp to 56Kbps < 5Mbps 10-100Mbps 100Mbps - 1Gbps
2000 2005 2011 2018~
Mobile
Fixed
Dial Up xDSL FTTx / Cable FTTH
Personal ContextVideo and eGoodsPersonal Content
ROAD TO GIGABIT ECONOMY NETWORKS
VideoExperience
SD HD + PVR 4K + VoD
8K/10K
+ Multiscreen + cPVR
+ Virtual RealityTV
| 3 |
CapEx 2016 (R$, Excludes spectrum capex)
B2C B2B Network TI Others
%YoY 4% 4% -0.2% 10% 10% 4%
2016
Competitive
exposure
Market
potential Line of
business
ROI by local market product offer
ROICapital intensity
70% OF CAPEX WILL BE ALLOCATED TO IMPROVE GROWTH AND CUSTOMER EXPERIENCE
up to
8.7 Bi
Capex Strategy
• Maintain quality leadership
• Enable Selective Growth• Customer value Big data
• Structural IT Transformation (BSS, OSS, ERP)
• Network optimization and consolidation
| 4 |
MOBILE NETWORK
Before 2015
+ Geolocation
2016+
+ Customer Value
+ Big Data
Traffic
Growth
Network
Estimates
Trends
Occupancy
BIG DATA AND CUSTOMER VALUE DRIVING MOBILE INVESTMENT
São Paulo example
| 6 |
2016 MOBILE ROLLOUT
2015 2016 2017
Technology Breakdown
4G
3G 2G
0.5%
2013 2014 2015 2016
Fiber to the Site
• Focus on High ROI cities
and Population Coverage
• 4G investment growing
41% YoY, versus -25% YoY
on 3G
• Acceleration in Fiber to
the Site deployment
FTTS Penetration
26%
3,137 3,289 3,524 3,945
3,543
2013 2014 2015 2016
3G cities
86.7% 87.5% 88.7% 88.8%Pop %
73140
183
352
185
2013 2014 2015 2016
4G cities
30.0% 40.6% 46.6% 60.0%Pop %
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1.2 1.3
0.9 0.9
1.6
0.6 0.70.6
0.3 0.4
TOTAL >500k 500k>>200k 200k>>100k <100k
Spectrum per population - 4G (MHz/1000 inhab.)
VIVO
411
3895 50
228183
3894
28 23
TOTAL >500k 500k>>200k 200k>>100k <100k
Cities coverage - 4G (by City population Size)
VIVO
6
8
10
12
14
16
51% 52% 53% 54% 55%
Speed (
Mbps)
Coverage*
*Based on users
average time spent
in the 4G network.
VIVO
Player 2
VIVO 4G COMPARED WITH COVERAGE LEADER
The State of LTE Report
(Feb/16) OpenSignal
| 8 |
ASSETS COMPARED
Technology SPECTRUM VIVO CLARO TIM OI
2G
800 25MHz 25MHz - -
900 5Mhz 5MHz 5MHz 5MHz
1800 20MHz 20MHz 40MHz 40-50MHz
3G 2100 30MHz 20-30MHz 20-30MHz 20-30MHz
4G700 20MHz 20MHz 20MHz -
2500 40MHz 40MHz 20Mhz 20MHz
VIVO SPECTRUM
*Total band of operations in each spectrum calculated by
the average holding in the metropolitan areas of SP and RJ.
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VIVO SPECTRUM ASSESTS AVAILABILITYThe reduction of GSM traffic will enable the use of 850 MHz for 3G
The reduction of GSM it will enable the use of 1800 MHz for 4G
In order to deploy 4G network in 700 MHz, spectrum cleaningis needed. This will happen gradually between 2016 and 2019.
3G Band 2016 2017 2018 2019
Brasil
(except Norte
and Nordeste)
2,100 MHz 15 + 15 15 + 15 15 + 15 15 + 15
850 MHz 5 + 5 10 + 10 10 + 10 10 + 10
Total MHz 20 + 20 25 + 25 25 + 25 25 + 25
Norte
2,100 MHz 10 + 10 10 + 10 10 + 10 10 + 10
850 MHz 5 + 5 5 + 5 10 + 10 10 + 10
Total MHz 15 + 15 15 + 15 20 + 20 20 + 20
Nordeste
2,100 MHz 10 + 10 15 + 15 15 + 15 15 + 15
850 MHz - - - -
Total MHz 10 + 10 15 + 15 15 + 15 15 + 15
2G Band 2016 2017 2018 2019
Brasil
(except Norte
and Nordeste)
850 MHz 7,5 + 7,5 2,5 + 2,5 2,5 + 2,5 2,5 + 2,5
1,800 MHz 10 + 10 5 + 5 5 + 5 5 + 5
Total MHz 17,5 + 17,5 7,5 + 7,5 7,5 + 7,5 7,5 + 7,5
Norte
850 MHz 7,5 + 7,5 7,5 + 7,5 2,5 + 2,5 2,5 + 2,5
1,800 MHz 12,5 + 12,5 7,5 + 7,5 7,5 + 7,5 7,5 + 7,5
Total MHz 19,5 + 19,5 15 + 15 10 + 10 10 + 10
Nordeste
850 MHz - - - -
1,800 MHz 15 + 15 15 + 15 15 + 15 5 + 5
Total MHz 15 + 15 15 + 15 15 + 15 5 + 5
4G Band 2016 2017 2018 2019
Brasil
(except
Nordeste
and
Cluster P)
2,600 MHz 20 + 20 20 + 20 20 + 20 20 + 20
1,800 MHz - 5 + 5 5 + 5 5 + 5
700 MHz - (*) (*) 10 + 10
Total MHz 20 + 20 25 + 25 25 + 25 35 + 35
Cluster P
(**)
2,600 MHz 20 + 20 30 + 30 30 + 30 30 + 30
1,800 MHz - 5 + 5 5 + 5 5 + 5
700 MHz - - - 10 + 10
Total MHz 20 + 20 35 + 35 35 + 35 45 + 45
Nordeste
2,600 MHz 20 + 20 20 + 20 20 + 20 20 + 20
1,800 MHz 10 + 10 10 + 10 10 + 10 20 + 20
700 MHz - (*) (*) 10 + 10
Total MHz 30 + 30 30 + 30 30 + 30 50 + 50
| 10 |
(*) 10 + 10 MHz available in some cities.
(**) DDD 11, 21, 48, 51, 54, 63 e 67
BROADBAND AND VIDEO
Speed versus % of Same Copper Pairs (measured)
Until 1M 3M 8M 12M 25M 50M
0.7%
40.2%
4.6%10.3%
30.9%
13.2%
FTTCShortening of xDSL distance in legacy copper increases UBB availability
Before FTTC
After FTTC
4.4%
9.3%
27.3%29.9%
16.8%
Until 1M 3M 8M 12M 25M 50M
From 82%
Between 1M e 2M
To 96%
Between 10M to 50M
12.3%
• Average Capex per Home
Connected ~60% lower than FTTH
• Potential Delta ARPU +35%
• 2.7M Households upgradeable
Plan to build 1.5M in the next 3
years
| 12 |
CONTENT CACHINGSince February, Netflix caching improved dramatically
customer experience while saving Opex
W52 W01 W02 W03 04 W05 W06 W07 W08 W09 (01/03)
116G118G
127G
101G
66G
46G 46G42G 43G
36G
Download
-71%
Outbound Netflix Traffic
153
20 248 4 3
Jan 2016Before Cache
Feb 2016 AfterCache
GVTBenchmark
Netflix Performance
Secs to HD Quality Secs to Start Streaming
Videos start 2X Faster
HD quality 8X Faster
• Started Feb 2016 for Vivo Fiber and xDSL
• Next Steps
- Google/YouTube, Facebook
| 13 |
Customer congratulates Vivo, saying that quality is now excellent
“Vivo/GVT will win many new customers”
POSITIVE CUSTOMERFEEDBACK AFTER NETFLIX CACHE ROLLOUT
Jan 24th Customer awaiting cache activation
Jan 26th
Same customer publishes his satisfaction after cache activation
| 14 |
Initial Results in São Paulo Reference Area
SELECTIVE FIELD INSOURCING BRINGING QUALITY AND PRODUCTIVITY GAINS
5.7%6.6%
8.1%
6.0%5.3% 5.5%
NOV DEZ JAN
4.3 4.5 5.8
Nov Dec Jan
1.5 1.7 1.8
Nov Dec Jan
13.1%14.7%
16.6%15.2%
11.2%9.6%
NOV DEC JAN
2014 2015
Quality – Technical repair rate(defects/active line)
Individual Productivity (Activites/technician/day)
Copper Fiber
Repeated repair rate (New defect before 7 days)
| 15 |
DEC
NEW TV PLATFORM MOVING TO A CONVERGENT VIDEO SERVICE
Fiber IPTV MultiScreen2 DTH
Platforms
STBs HybridSTBs IPTV
IPTV HYBRID DTH
BACKEND TV
FIBRA
IPTV Linear
Distribution
PC, Tablet,
cTV, Mobile
BACKEND TV
OTT
Video Over
Demand (VoD)
OTT Linear
Distribution
Video Over
Demand (VoD)
BACKEND TV
DTH
DTH Linear
Distribution
Video Over
Demand (VoD)
MULTISCREEN
Converged Video Platform
Single user interface
Advanced features
(start-over, catch-up) DTH consolidation
Open Platform
IPTV HYBRID DTHMULTISCREEN
APPsAPIs
VODcDVR
| 16 |
IT TRANSFORMATION
Customer Base Migration
1% 16% 36%71% 91% 100%
2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
CONSOLIDATED IT SYSTEMS Transformation of São Paulo Fixed Business
GVT Systems and PortfolioSales, Customer Care, Billing,
Tech Support
Network Network
Automated provisioning, Single installation visit
Integrated customer care tools
Single Bill
Harmonized 3P Portfolio
| 18 |
ONGOING SIMPLIFICATION OF LEGACY SYSTEMS ARCHITECTURE
TV Fiber Copper
OTT DTH IPTV Data Voice Data
Sales and CRMNsi@
Vivo 360°
ATISNYX
CIPEX
CSOCSO
CadCli
Network Provisioning
NSI@
GIFT Agendador
SGOS
SIGRES
OSP
SIGRES Terus
SCAIOSP GVOX
SGOS FOC
Billing and Collections
NSI@ NIS@
ATIS
CAR
FAT
SIU
SGS
INA
Field Force Automation
MobilePeople
Mobile PeopleGift
SCAI
ATIS
CSO
Before
ATIS
CSO
Converged 3-Play
Siebel 8
GPS
Savvion
COL
NEC/ SAGRE/ TBS/ SIGRIS/ OSP/ TERUS
Kenan
TOA ETA Direct
2016
• Converged 3P portfolio
• Simplified SW stack
• Faster Time-to-Market
• Higher efficiency and
productivity
| 19 |
ENABLING DIGITALNew n-Play Full stack System
ONLINE AND OMNICHANNEL
Automated and streamlined
business processes
(ZERO BACKOFFICE)
360 CUSTOMER VIEW – n-P
Business Process Transformation
1
2
E-CARE /
E-COMMERCE
SALES
CUSTOMER CARE
BILLING/COLLECTIONS
N-Play BUNDLES
4P
MOBILE |IPTV
VOIP | FIBER UBB
MOBILE PREPAID
FWT
nP
FIBER
DTH
ADSL
COPPERMOBILE &
CONTROL
Phase 1
3Q16
Phase 2
4Q16
Phase 3
1Q17
Phase 4
2Q17
Phase 5
3Q18
E-CARE APP CALL CENTERE-COMMERCE RETAIL
| 20 |
EFFICIENCY
869
637 568 483635
546464 392
2012 2013 2014 2015 2016 2017 2018
87
5 5
8
65
2012 2013 2014 2015 2016 2017
-3% 3%
45.0%
57.6%
71.6% 76.6%
75.1%
76.0% 77.0% 78.0%
2012 2013 2014 2015 2016 2017 2018
CONSOLIDATIONAND EFFICIENCY IN IT
Data center consolidationData Center Quantity
Vivo 1 Vivo 1 + GVT
6 DCs decomissioned until 2017
Application shutdown
Applications Quantity
-44% -38%
629 Applications shut down until 2018
Virtualization Index
% Virtualized Servers
| 22 |
90 181 273378
484591
699925
11511378
16061784
180
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Additional FTTS 2016Accumulated
Leveraging combined network capillarity to bring traffic on net
Better quality
Increase data capacity and customer
experience using existing GVT fiber
Lower cost
194553
1,349
2,1802,395 2,544 2,600
223438
1,3151,903
2,9653,177 3,340
Jun Jul Aug Sep Oct Nov Dec
BP Realized
Better quality
Lower cost
Leased Lines 2015
SYNERGIESLeased line migration and fiber to the site
| 23 |
QUALITY
7.066.98
7.06
7.22
7.39
Dec/14 Mar/15 Jun/15 Sep/15 Dec/15
Note: Brazil CSI 2015 includes only Vivo, the result of GVT is 7.47 (Dec/15)
VIVO BRASIL CSIGrowing Customer SatisfactionVivo breaking away from closest competitor
GAP +0.07 +0.08 +0.15 +0.20 +0.34
GVT7.47
| 25 |
QUALITY PLANA process of transformation towards a culture focused on customer satisfaction
• Orientation for choosing the appropriate service
• Product easy to understand• Deliver what was promised
Sales and Activation
• Use the service whenever you want• Be satisfied with the offered serviceOperation
• Quick service in the channel of your choice• Understanding and solving the problem
CustomerCare
• Meet the agreed deadline• Efficiency in defect resolution
Technical Support
• Bills that are easy to understand• Receive the bill with the correct
value and on the time• Ethics and respect in debt collection
Billing the Collection
CONTACT RATEReduce customer contact rate
CONSUMER PROTECTION AGENCIESReduction in complaints and litigation
We established a commitment with the entire organization through a Quality Plan,with goals and plans, anda Endomarketing and Training Program, to mobilize the company about the responsibility for customer satisfaction
REGULATORYBetter compliance with quality goals
CSIIncrease customer satisfaction
| 26 |
Note: Comparison Mar/15 vs Dec/15 - total of 74 measured processes of all segments
118 ACTION PLANS, 30 ALREADY IMPLEMENTEDEVOLUTION OF SATISFACTION IN 85% OF PROCESSES
-3%8%
3%7% 8%
5%20% 10%
3%
-2%0% -5%
2%2% 3%11%
17%
11%
17%
6%
Post Paid
8%
8%
3%
-1%
2%
Pre Paid
18%
6%
13%
7%
6%
Small Medium Business
Voice Network
Internet Network
Customer Care
Commercial Offer
Billing/ Recharge
Mobile
General Operation
Technical Support
Customer Care
Commercial Offer
Billing
Fixed Residential
Small Medium Business
EnterprisesFixed & Mobile
| 27 |
PF: Individuals, PJ: Small/Medium Business
CUSTOMER CARE OPERATION KPIS EVOLUTION
Contact Rate PF (Gross)
IVR Quality Score PF (Top box)
Mar
15Sep
15
Dec
15
Apr
15Sep
15
Dec
15
Mobile Fixed (Vivo + GVT)
Dec
14Mar
15
Sep
15
Dec
15
Dec
14Mar
15
Sep
15
Dec
15
Repeated Calls PF (%)
Dec
14
Mar
15
Sep
15
Dec
15
Dec
14
Mar
15
Sep
15
Dec
15
IVR Retention PF + PJ (%)
Dec
14
Mar
15
Sep
15
Dec
15
Dec
14
Mar
15
Sep
15
Dec
15
Transferred Calls PF (%)
Dec
14
Mar
15
Sep
15
Dec
15
Dec
14
Mar
15
Sep
15
Dec
15
| 28 |
Dial 9 rate*(talk to representative)
Usability Mean Time*
*MG Standard IVR Humanized
HUMANIZED IVR RESULTS IN CUSTOMER CARE
Friendly communication
CustomizedIVR Menus
Persona• Dynamic
• Smart
• Fun
• Trendy
• Agile
• Friendly
• Empathic
| 29 |
% IVR Retention (Regional)Target +4.5 PP (in 6 months)
Results
MG SP/RJStandard Humanized
4Q14 1Q15 2Q15 3Q15 4Q15 4Q14 4Q15
Meu Vivo App + Web SMS
DIGITAL CRM CHANNELS
(Access in millions) (Access in millions)
95% 91% Retention in 24h Retention in 24h
Low rate of Follow-up calls
| 30 |
Customer Value SegmentationInsource of Customer Care to the 5% most valuable customers
Customers (%)
5%
95%
Segmented Care
0% 87%
Timeline
Top High Value
Massive
2015 2016 2017
100%
| 31 |
MAIN INITIATIVES 2016
FTTC SP
FTTH OSP
NEW VIDEO PLATFORM
BACKBONE CONSOLIDATION
MOBILE DEPLOYMENT
SINGLE FIXED BSSSOPHIA
INTEGRATED 3P
SELECTIVE INSOURCINGFIELD FORCE AND CUSTOMER CARE
REBRANDING
WORKFORCE MANAGEMENTSYSTEM CONSOLIDATION
| 32 |
MAIN INITIATIVES 2016
DIGITAL FIRST ENABLER
ZERO WASTE
NEW n-P BSS PLATFORM
BIG DATA
DW CONVERGENCELEGAL ENTITY CONSOLIDATION
(SAP)
CAPEX EFFICIENCY
HUMANIZED CUSTOMER CARE
| 33 |
DISCLAIMER
These presentations may contain forward-looking statements concerning future prospects
and objectives regarding growth of the subscriber base, a breakdown of the various
services to be offered and their respective results.
The exclusive purpose of such statements is to indicate how we intend to expand our
business and they should therefore not be regarded as guarantees of future performance.
Our actual results may differ materially from those contained in such forward-looking
statements, due to a variety of factors, including Brazilian political and economic factors,
the development of competitive technologies, access to the capital required to achieve
those results, and the emergence of strong competition in the markets in which we
operate.
For a better understanding, we are presenting pro forma numbers combining Telefônica
Brasil and GVT results for all financial and operational indicators for every period as of
January, 2014.