Several networking startups, most of which are actually software companies, launched products claiming to transform networking with SD-WAN, SD-Security, wireless networking with machine learning, guest WiFi services, and various new twists on network virtualization and virtualized routers. Many of these startups are focused on the SD-WAN market, which IDC forecasts will reach $6 billion by 2020.
The new age networking companies included: Barefoot Networks, 128 Technology, Apstra, Cloud4Wi, Mist Systems, CloudGenix, and SnapRoute. In November, Forward Networks launched out of stealth using formal verification to model network behavior and help prevent outages.
We believe that Barefoot Networks, headed up by South African Martin Izzard, is the most promising of the bunch and very well funded. The company announced it’s programmable switch platform in June – touting it as the world’s fastest and most programmable series of switches. Barefoot’s Tofino switch chip can fit inside hardware devices to direct the flow of data traffic across networks, and the company plans to advance SDN though its software suite of tools for programming Tofino. The startup also built a programming language, P4 — Programming Protocol-Independent Packet Processors – to allow developers to differentiate their networks and solutions.
In November, Chinese web goliaths Alibaba and Tencent led a $23 million funding round for Barefoot. Since it emerged from stealth in June, the company has raised more than $150 million, backed by venerable and respected companies like Hewlett Packard Enterprise, Google and Goldman Sachs.
Viptela is a four year old startup that specializes in network virtualization and SD-WAN. 90% of Viptela’s customers are hosted on Amazon Web Services. The others are giant enterprises that use its services in their own data centers. The company recently named Praveen Akkiraju as CEO. More details at: http://www.bizjournals.com/sanjose/news/2017/01/12/cisco-veteran-takes-reins-at-san-jose-competitor.html
The startups boast impressive leadership and funding, but we believe very few, if any, will actually survive and gain critical market mass to challenge incumbent network equipment companies left, e.g. Nokia, Ericsson, Huawei, Cisco, ZTE, Ciena, etc.
We strongly believe that cloud computing has and will continue to have more impact than any other IT trend. Conversely, we think there’s a tremendous gap between the hype surrounding many new technologies/movements and their profit making potential. The hyped technologies include, but are not limited to “5G”, Internet of Things (IoT), Open Networking/SDN/SD-WAN/NFV, Virtual Reality, etc.
Cloud computing changes the networking industry in the following ways:
- The branch and spoke topology of private WANs and IP VPNs has been based on branch offices connecting to the centralized corporate computing data center (via IP VPNs, private lines, Ethernet virtual private lines, etc). That’s now giving way to branch offices accessing cloud computing resources via a variety of networking schemes that we’ve discussed in several previous articles (one we especially like is AT&Ts Netbond).
- The volume of networking equipment sold for enterprise/private networks is decreasing due to the flat to declining growth of premises data centers which are remotely accessed via switch/routers. Many of the mega cloud providers, like Google and Facebook, design their own switch/routers for use in their mega data centers. Other cloud players, like Microsoft, continue to buy switch/routers from legacy vendors (e.g. Cisco, Juniper and Arista Networks).
- Large backbone networks used to be designed and deployed ONLY by government agencies (like NSA, NSF, European Commission, etc) and global telcos with huge footprints. Those telcos include AT&T, NTT, BT, Verizon, Level 3, Deutsche Telekom, Telefonica, etc. Their backbone networks will not grow as fast in the future as none of those companies are large cloud computing or storage service providers. Even the US government is moving from premises based to cloud computing services, which decreases the need for government agency private networking.
- The big cloud players (Amazon, Google, Microsoft, Facebook, Alibaba, Tencent, etc) are constructing and adding on to their wide are backbone networks which inter-connects their mega data centers. For example, Amazon has recently completed deployment of a 8,700-mile undersea cable, which is part of its A.W.S. global network. Microsoft and Facebook are also building a large undersea cable network called MARIA.
- The control and analytics for the IoT are likely to be built on cloud platforms, such as AWS IoT. These are managed cloud platforms that lets connected devices easily and securely interact with cloud applications and other devices. AWS IoT can support billions of devices and trillions of messages, and can process and route those messages to AWS endpoints and to other devices reliably and securely.
- When standardized and certified “5G” service finally arrives (sometime in 2021 or later), we believe that remote user access to the cloud will be a very valid use case for IoT real time control/analytics and other applications that require low latency to/from wireless endpoint and the cloud.
NY Times article (Dec 26, 2016): Why the Computing Cloud Will Keep Growing and Growing, by QUENTIN HARDY
Jeff Bezos of Amazon, along with a couple of his rivals, may eventually control much of the $1 trillion global market for business computers and software.
That is because Amazon Web Services, his big-business computing division, is starting to affect more than just the world of computer servers, data storage and networking at the core of computing. Increasingly, it is also entangled with mobile phones, sensors and all sorts of other devices in the so-called Internet of Things.
It’s the same story at Microsoft Azure and Google Cloud Platform, the other two big cloud companies. Start-ups and giant corporations rent the core resources, along with related software, instead of owning and running their own machines.
What’s next? As innovations like artificial intelligence and connected devices become popular, customers are putting cloud components in mobile computing, home games and email marketing campaigns. In other words, the big clouds aim to be everywhere.
“When has Amazon ever thought about anything other than world domination?” said Lydia Leong, who follows cloud computing at Gartner. Not content to be in big centralized data centers, she said, “they want to be at the edges, whether that is a customer’s own computers or the Internet of Things.”
This aim for domination was clear at Amazon’s big customer conference, called Re:Invent, which was held in Las Vegas this month. About 32,000 people went to the fourth annual event.
In one talk at the conference, an Amazon Web Services executive showed off the company’s 8,700-mile undersea cable, part of an A.W.S. global network that each day adds computing power equal to that inside a Fortune 500 corporation, and spoke about this expansion. He talked about crushing the costs of servers and networking, most likely sad news for old tech giants that make those things, like Dell and Cisco.
In a nice bit of showmanship during the main keynote, Andy Jassy, the head of A.W.S., appeared onstage with an 18-wheel truck carrying a device that could suck 100 petabytes of data out of a customer’s computers and put it in the Amazon cloud. That is equal to two billion filing cabinets of paper, which a surprising number of companies now possess in digital form, thanks to things like video and sensors.
Put that together with some software Mr. Jassy talked about that would be on chips made by Intel but capable of gaining access to the A.W.S. cloud, and you get the picture: There isn’t a part of computing Amazon doesn’t want to touch.
It is easy to see why this matters to Amazon. In the third quarter, A.W.S. had revenue of $13 billion a year, growing at 55 percent annually. A.W.S. was 10 percent of Amazon’s revenue, but more than 100 percent of the company’s operating income. Amazon’s international retail business lost money, and United States retail sales are nowhere near as profitable.
Amazon says it is hardly moving away from a core business of providing large-scale computing, but rather finding more ways to sell stuff related to it by moving to edge devices.
“We see it less as a move from one to the other, and more of an extension,” an Amazon spokeswoman, Mary Camarata, wrote in an email Saturday. “We have an enormous number of customers excited about leveraging the capabilities.”
Amazon is not alone in this business, and the competition is getting more intense. A.W.S. now has 81 services, including ways to work on home video games. Microsoft’s 67 services include Internet of Things “hubs” and email marketing campaigns. Google has 53, including ways to deploy mobile software globally and steer performance with data analysis. Comparisons of services are difficult, as one company’s service may encompass two or three offered by another.
Machine learning — a method for computers to gain knowledge without being programmed with that information — is front and center for Alphabet’s Google, said Urs Hölzle, the head of technical infrastructure at Google Compute. Google has recently shown off its own global network of submarine cables, along with local devices like cloud-connected office whiteboards. Over the next year, Mr. Hölzle said, Google will open about one new Compute facility a month.
Building out across the globe, with sometimes $1 billion or more in a facility, is critical in some cases to meet local data regulations. Equally, the big cloud companies all want to be as close to customers and their devices as possible.
“Global proximity is a huge advantage,” said Corey Sanders, the director of program management at Azure. “This is a way to transform your business, including the way devices on the edge act.”
There are profound consequences from the scale and ambition of this trend. Given their size, wealth and technical expertise, the big cloud companies are likely to build cheaper designs and demand lower prices for everything in computing. Who is to say they don’t affect the devices themselves?
That is starting to dawn on the rest of the industry. On the first day of Re:Invent, Mr. Jassy had a private lunch with about 10 venture capitalists. It is an annual affair, where he indicates where A.W.S. is going, and they figure out how to make money from it.
“He wasn’t explicit, but if you were hoping to invest in storage, computing — anything below applications — you are hosed,” said Dharmesh Thakker, a partner at Battery Ventures, who attended the lunch. “Andy is smart and approachable, but reading between the lines, I’m not sure this is good for the V.C. ecosystem.”
AT&T Inc. has asked permission from the Federal Communications Commission (FCC), to shut down the 13 legacy TDM (Time-division multiplexing) services of its wholly owned subsidiary – Southwestern Bell Telephone Company. The decision to terminate the services stems from lack of demand. Southwestern Bell Telephone Company operates in Arkansas, Kansas, Missouri, Oklahoma, Texas and parts of Illinois.
“AT&T currently has no customers that subscribe to these service options and has not had any requests seeking these service options in the previous two years,” AT&T said in its FCC filing. The service is expected to shut down effective Feb 28, 2017, subject to FCC approval.
The services to be shut down include Telegraph Bridging Four-Wire Capability, Voice-grade Active Telemetry and Alarm Bridging Split Band Capability. Telegraph Bridging Four-Wire Capability offers bridging functions on a telegraph grade circuit that connect three or more customer-designated building in a multipoint arrangement. Voice-grade Active Telemetry and Alarm Bridging Split Band Capability is a Telemetry and Alarm bridging network which divides the voice band into two portions, one for each direction of transmission.
TDM service discontinuation has become a growing trend in the wireline segment of the telecom industry. Telecom service providers are moving toward IP-based networks as an increasing number of enterprise customers are opting for IP-enabled cloud services.
AT&T earlier requested the FCC for permission to discontinue a series of legacy services including collect calling, person-to-person calling, bill to third party, Busy Line Verification, Busy Line Interruption and International Directory Assistance in Jun 2016.
Besides AT&T, national telecom carriers like Sprint and Verizon Communications have opted for similar service discontinuation. Verizon seek the FCC’s nod to stop providing postpaid calling card and personal 800 services while Sprint asked to discontinue long-distance voice services. Level 3 Communications has sought permission from the FCC to discontinue its legacy voice services based on outdated TDM (time division multiplexing) technology.
The NFV Interoperability Testing Initiative, meant to address network functions virtualization deployments, has been established by mainstream network equipment vendors – Cisco Systems, Ericsson, Huawei Technologies and Nokia.
“The general guiding principles for NFV-ITI are openness, fairness, reasonableness and nondiscriminatory treatment,” the organization noted in a statement. “All relevant NFV vendors are welcome to join this initiative by ratifying the NFV-ITI MoU.”
OPNFV recently unveiled its Colorado platform release, which includes updates targeted at accelerating the development of NFV applications and services by enhancing security, IPv6 support, service function chaining, testing VPN capabilities and support for multiple hardware architectures. The organization noted the updates followed collaboration with upstream communities and are integrated into the “automated install/deploy/testing framework.”
OPNFV also highlighted increased collaboration across ecosystems via working groups focused on management and operation; infrastructure; security and testing, with five “committers-at-large” members elected to the OPNFV Technical Steering Committee “to enhance the meritocratic nature of the project.”
A Technology Business Research (TBR) report from earlier this year found some early adopter telecom operators were moving forward with limited commercial launches of NFV and software-defined networking technologies despite continuing questions around the lack of NFV and SDN standards. According to TBR’s “NFV/SDN Telecom Market Landscape” report for the first quarter, these early launches are “leveraging a mix of vendor solutions and internal resources ahead of industry adopted standards,” with cost reduction and service agility seen as key drivers for initial deployments. TBR noted for carriers like AT&T, NFV and SDN are viewed as “critical for long-term survival.”
“Early adopters pursue differing approaches to build NFV and SDN solutions,” the report notes. “One approach is to build an end-to-end NFV stack leveraging products from several vendors. These deployments require tested, interoperable components to ensure carrier-grade delivery. Adding further complexity, operators must decide which vendor, if any, integrates the stack.”
By Richard Webb, research director, mobile backhaul and small cells, IHS Markit
- The outdoor small cell backhaul market accelerated in 2016, with revenue growing more than 200 percent year-over-year
- Just over $5 billion will be spent globally on outdoor small cell backhaul equipment from 2016 to 2020
- By 2020, deployments of outdoor small cell backhaul connections are projected to approach nearly 700,000
The small cell backhaul market is still in experimentation mode and has been since early trials commenced in 2013. Market growth started to look more meaningful this year—with revenue up 233 percent year-over-year, albeit from a very modest base—but we anticipate the market to really kick into higher gear in 2018.
IHS Markit is forecasting that a cumulative $5.1 billion will be spent worldwide on outdoor small cell backhaul equipment between 2016 and 2020, driven by an increasing number of mostly modest-scale projects to augment 3G and Long Term Evolution (LTE) capacity in urban areas and to provide mobile coverage in rural markets. The compound annual growth rate (CAGR) for the five-year period is 78 percent.
It’s worth noting that the $5.1 billion for outdoor small cells is in addition to the nearly $43 billion that’s being spent on macrocell backhaul equipment during the same five-year period.
Deployments of outdoor small cell backhaul connections are expected to grow to 109,000 in 2016, up from 35,000 in 2015. And by 2020, deployments are projected to reach 693,000—for a total installed base of around 1.9 million.
Wireless microwave makes up nearly 60 percent of small cell backhaul gear revenue today, climbing to over 80 percent in 2020 led by E band millimeter.
Geographically, small cell deployments generally reflect the regional share of the overall mobile infrastructure market. By 2020, the regional breakdown for small cell backhaul equipment will be: Asia Pacific (48 percent), Europe, the Middle East and Africa (27 percent), the Caribbean and Latin America (14 percent) and North America (11 percent).
Small Cell Report Synopsis:
The IHS Markit biannual small cell mobile backhaul equipment report tracks equipment used for transporting traffic from outdoor small cell sites, such as those attached to light poles, utility poles, and the sides and tops of buildings. It provides worldwide and regional market size, forecasts through 2020, analysis and trends for equipment, connections and cell sites by type. The report covers equipment including digital subscriber line (DSL) modems and digital subscriber line access multiplexers (DSLAMs); Ethernet over copper and fiber; <6GHz microwave; point-to-point (P2P) microwave; point-to-multipoint (P2MP) microwave; and licensed and unlicensed millimeter wave.
For information about purchasing this report, contact the sales department at IHS Markit in the Americas at (844) 301-7334 or AmericasLeads@ihsmarkit.com; in Europe, Middle East and Africa (EMEA) at +44 1344 328 300 or firstname.lastname@example.org; or Asia-Pacific (APAC) at +604 291 3600 or technology_APAC@ihsmarkit.com
Separately, a report “Mobile and Wireless Backhaul Market – by Equipment (Microwave, Millimeter Wave, Sub 6 GHZ, Test and Measurement), by Services (Network, System Integration, Professional) – Worldwide Market Forecasts and Analysis to 2015 – 2020″, the market is estimated to grow from USD 17.85 Billion in 2015 to USD 33.15 Billion by 2020, at an estimated compound annual growth rate (CAGR) of 13.18% from 2015 to 2020.
The growing need to remain connected and increasing adaption rate of 3G and 4G (Long-Term Evolution) networks has enhanced the market of mobile and wireless backhaul. Increasing usage of smart phones and tablets has increased the mobile data traffic and this has fueled the market for a fast and reliable connectivity. Technical advancements such as small cells, has to quench the high bandwidth needs.
Growing mobile data traffic is spurring the market of mobile and wireless backhaul
Nowadays, spectrum band has been increased to up to 42GHz owing to the need for faster connectivity. Also, the introduction of 5G is offering great opportunity for mobile and wireless backhaul market. Popularity of data exhaustive such as video on demand, online streaming and video connectivity is continually growing and driving the mobile traffic data. The installation of small cells enables the network operators to offload the mobile data on the unlicensed spectrum using Wi-Fi, hence reducing the congestion on the macro-cells and licensed spectrum.
The microwave equipment segment is estimated to account for majority of the total mobile and wireless backhaul market in 2015, but is slowly losing its market share because of the increasing adoption of millimeter wave equipment. The major trends seen in the service market are the increasing use of system integration services by end user to effectively deploy mobile and wireless backhaul solutions and the easy integration of these solutions with the existing ones.
The North America region is expected to contribute the maximum market share to the overall mobile and wireless backhaul market
North America will witness the highest market share in 2015, and will continue to dominate the globe during the forecast period. The mobile and wireless backhaul markets in Asia-Pacific (APAC), Middle East and Africa (MEA), and Latin America are expected to witness substantial growth, as large enterprises as well as SMBs are yet to adopt the solutions. Major enterprises in these emerging economies are expected to increase investments in mobile and wireless backhaul solutions, due to the huge demand for managing aging infrastructure and assets.
The major vendors in the mobile and wireless backhaul market include Alcatel Lucent, Cisco Systems, Ericsson, Huawei Technologies, Broadcom Corporation, Brocade Communications Systems, Fujitsu, Nokia Networks, Tellabs, and ZTE Corporation. A detailed analysis on key industry players is done to provide key insights about their businesses, products and services, key strategies, and recent developments associated with the mobile and wireless backhaul market.
The mobile and wireless backhaul market has been segmented into equipment, services, and regions. The equipment is further segmented into Microwave, Millimeter wave, Sub 6 GHz, and Test and Measurement. The service types are Network services, System Integration, and Professional Services. Furthermore, the report classifies the market according to the regions of North America, Europe, APAC, MEA, and Latin America.
Markets and Markets
UNIT no 802, Tower no. 7, SEZ
Magarpatta city, Hadapsar
Pune, Maharashtra 411013, India
In a new research note, Moody’s Investor Services stated that the overall U.S. telecom industry has not kept pace with cable companies (cablecos or MSOs) in terms of broadband deployments and speeds.
“Except for Verizon’s FiOS footprint, the US telecom industry has under-invested in broadband,” said Mark Stodden, VP and senior credit officer for Moody’s Investor Service. “Market share gains of cable operators (MSO’s) will persist given the capital required to catch up,” he added.
Stodden concluded that “wireline revenues will continue eroding as cable operators gain broadband share.”
Fierce Telecom also reported Moody’s research on telcos under-investing in broadband.
Telcos Lose While MSO’s Gain Broadband Subscribers:
In 3Q-2016, the top telcos collectively lost about 150,000 subscribers, widening the loss of about 145,000 they saw in the same period a year ago.
Leichtman Research Group (LRG) reported in a press release that the fourteen largest cable and telephone providers in the US — representing about 95% of the market — acquired about 625,000 net additional high-speed Internet subscribers in 3Q 2016. These top broadband providers now account for 92.5 million subscribers — with top cable companies having 57.8 million broadband subscribers, and top phone companies having 34.7 million subscribers. Among the individual telcos tracked by LRG for the Q3 study, only Verizon (24,000) and Cincinnati Bell (3,100) came away with net sub additions in the period.
Other broadband findings for the quarter include:
- Overall, broadband additions in 3Q 2016 were 99% of those in 3Q 2015
- The top cable companies added about 775,000 subscribers in 3Q 2016 — 99% of the net additions for the top cable companies in 3Q 2015
- The top phone companies lost about 150,000 broadband subscribers in 3Q 2016 — similar to the loss of about 145,000 in 3Q 2015
- Telco providers have had net broadband losses in five of the past six quarters
- In the first three quarters of 2016, cable companies (MSOs) added about 2,440,000 broadband subscribers, while Telcos lost about 475,000 subscribers
“While major providers now account for nearly 92.5 million broadband subscribers in the US, the broadband market continues to expand with top cable providers driving the growth,” said Bruce Leichtman, president and principal analyst for LRG, in a statement. “Over the past year, cable companies added more than 3.5 million broadband subscribers, accounting for 118% of the 2.995 million net broadband additions.”
Telco CAPEX Declined in 2015:
USTelecom, the champion of the traditional telcos, revealed in its annual broadband investment research report that broadband provider network capital expenditures (capex) declined nearly $1 billion in 2015 to $76 billion.
US Telecom wrote in its report that wireline broadband investment “remains critical to modernizing the nation’s network infrastructure and maintaining strong international leadership.”
AT&T maintains it’s continuing to invest in next-generation broadband networks under the company’s GigaPower brand. Earlier this week, AT&T announced that it has reached 46 markets with its 1 Gbps FTTH service. AT&T plans to expand GigaPower in parts of 23 more areas – at least 67 metros in total.
Image Courtesy of AT&T
Deepening its FTTH footprint continues to be a priority for AT&T. However, it’s unclear how broad the coverage is in these markets and what the take rate for true high speed Internet and TV will be.
AT&T says on its GigaPower website: “With internet speeds 20x faster than the average cable customer, you can download 25 songs in 1 second or your favorite 90-minute HD movie in less than 34 seconds.”
The latest AT&T GigaPower map is here.
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Akamai’s “Third Quarter, 2016 State of the Internet Report,” states that global average Internet speeds increased 21% year over year during the quarter, and peak speeds increased 16% year over year. The report includes data gathered from across the Akamai Intelligent Platform about connection speeds, broadband adoption metrics, notable Internet disruptions, IPv4 exhaustion and IPv6 implementation, and other relevant topics concerning the Internet and its usage, as well as trends seen in the data over time. Here are a few highlights by category:
Global Average Connection Speeds and Global Broadband Adoption:
- Global average connection speed increased 2.3% to 6.3 Mbps in the third quarter, a 21% increase year over year.
- South Korea had the highest average connection speed at 26.3 Mbps in the third quarter.
- US lags far behind, ranking No. 16 with average connection speed of 15.3 Mbps, a 7.7% rise from the prior quarter.
- Global average peak connection speed increased 3.4% to 37.2 Mbps in the third quarter, rising 16% year over year.
- Singapore had the highest average peak connection speed at 162 Mbps in the third quarter.
- Global 10 Mbps broadband adoption rate rose 5.4% quarter over quarter, and 15 Mbps and 25 Mbps broadband adoption rates increased 6.5% and 5.3%, respectively.
- Average mobile connection speeds ranged from a high of 23.7 Mbps in the United Kingdom to a low of 2.2 Mbps in Venezuela.
IPv4 and IPv6:
- The number of unique IPv4 addresses connecting to the Akamai Intelligent Platform was just over 806 million, which is 0.7% more than the second quarter of 2016.
- Belgium remained the clear global leader in IPv6 adoption with 39% of its connections to Akamai occurring over IPv6, up 3.3% from the previous quarter.
- Cable and wireless/mobile providers continued to drive the largest volumes of IPv6 requests, with Comcast, AT&T and Verizon Wireless topping the list with 44%, 43% and 80% of their requests to Akamai being made over IPv6 in their regions, respectively.
AT&T says it has implemented a reconfigurable optical add-drop multiplexer to deliver a 100 gigabits-per-second optical wavelength on a production network. The deployment, said to be a first with multi-vendor interoperability, was in the Dallas, TX area. AT&Ts new network provided the connection of two IP multi-protocol label switching (MPLS) routers with transponders and ROADMs from Ciena and Fujitsu.
Andre Fuetsch, President and CTO at AT&T Labs writes in a blog that the company is pursuing two goals with new ROADMs: 1. software control and 2. open hardware specs. Fuetsch also said the new ROADM is an industry-first, multi-vendor interoperability implementation.
“We recently implemented in the Dallas area a 100 gigabit per second optical wavelength in our production network using Open ROADM-compliant technology,” he wrote.
Controlling and managing the optical network is done via the NetConf/YANG APIs and information models defined in the Open ROADM Multi-Source Agreement standards. This is an industry-first demonstration of model-driven control and management of optical equipment. The 100G wavelength was provisioned using an SDN ROADM Controller developed by Fujitsu and integrated into the AT&T ECOMP architecture.
Learn more about the project and see the latest specs and project participants at OpenROADM.org.
AT&T says it “welcomes new suppliers and service providers to join our open ecosystem!”
In a 2015 research note, Global Industry Analysts forecast that the worldwide reconfigurable optical add-drop multiplexer (ROADM) market would surpass $10.8 billion by 2020. The firm saw much of that growth coming from the need for data, video, and voice service providers to address the immense network traffic generated by the likes of social networks, data center virtualization, file sharing, video downloads, cloud computing, and online gaming.
Vodafone is keenly interested in Nokia’s Cloud RAN architecture for switching between 4G, 5G and IoT. Trials of Nokia’s AirScale Cloud RAN platform conducted at a Vodafone R&D site in Italy assessed the suitability of C-RAN to provide the same service level as existing RAN architecture used for the company’s LTE networks. The tests also evaluated the potential added efficiencies and benefits associated with deploying cloud technology, which Nokia stated includes improved scalability and flexibility.
The trials examined the use of cloud-based radio access technology for macro networks. A major reason, over and above the usual efficiency/agility ones, to move RANs to the cloud is the hybrid nature of future networks, with 4G expected to coexist with both new 5G air interfaces and LPWANs for IoT.
Splitting baseband processing functionality between real-time and non real-time functions is the name of the game, apparently, because that allows the most time sensitive functions to be performed at the edge of the network, while others are virtualized and run in the cloud, allowing all the expected cloudy goodness.
“Working with Nokia on this trial we have seen how the application of Cloud RAN architecture can help the network react to changing demands quickly,” said Santiago Tenorio, Head of Networks at Vodafone Group. “It speeds up the delivery of services and will help with the transition to 5G.”
“Our Cloud RAN technology can help operators optimize network performance even as they cope with the increasing demands being placed upon them,” said Roberto Loiola, Head of Vodafone Global Customer Business Team at Nokia. “This trial with Vodafone builds on this promise, enabling Nokia to apply its longstanding working relationship with them to explore how we can enable the smooth and efficient transition from 4G to 5G.”
Other 5G trials in the works:
- Telefónica recently announced a 5G Proof of Concept trial with Huawei and last week dabbled in a spot of Pre5G massive MIMO live testing with ZTE.
- Huawei and BT have established a 5G research partnership, including how faster mobile communication technologies might be applied, as well as the technical and commercial feasibility of deploying them.
- We reported last week that Verizon was testing “Wireless Fiber” in a 5G trial.
- Ericsson believes most large wireless network operators are already planning 5G trials.
Cincinnati Bell’s bold three-year plan to expand its fiber networks will open the door for more opportunities to explore virtual network infrastructure, said Leigh Fox, COO of Cincinnati Bell, on December 6th during the UBS 44th Annual Global Media and Communications Conference.
“This project we just kicked off to look at this will be a 36 month or longer project,” Fox said. “As we build more fiber into our footprint, we also begin to hit thresholds where true network transformation is possible.” Fox said that the first tangible benefit of the transformation could be to offer an SD-WAN service to business customers.
“In the short run something like SD-WAN is more of an opportunity from a product standpoint for us,” said COO Leigh Fox. “We’ll launch an SD-WAN product in April next year so we see more growth from a revenue standpoint.”
Fox said that while the provider has no immediate plans to extend fiber into new territories, SD-WAN and other cloud-based services could strengthen the telco’s bond with multi-site customers.
“From an enterprise standpoint, I think that’s where you get into SD-WAN or more network as a service NaaS-type products,” Fox said. “I don’t think that you have build network and the way the product innovations are going we can combine unique products to follow them anywhere.”
Comments (not from this author who’s a SD-WAN skeptic):
Any technology needs to focus on the business proposition. Here are a few points that I think are most important:
- The WAN is really expensive and often more than 70% of the IT network budget. Even a 10% reduction in WAN cost has a substantial impact on the bottom line.
- Typically 50% of WAN spending is unused or “zombie” bandwidth as it is wasted for redundancy. (Imagine having 50% of your employees sitting around waiting for something to do)
- SD-WANs include such as cost of assets, remote administration, and cost of operation, but these two items are headline issues that need urgent solutions.