Omdia: High-speed data-center Ethernet adapter market at $1.7 billion in 2019
Executive Summary:
The market for Ethernet adapters with speeds of 25 gigabits (25GE) and faster deployed by enterprises, cloud service providers and telecommunication network providers at data centers topped $1 billion for the first time in 2019, according to Omdia.
The total Ethernet adapter market size stood at $1.7 billion for the year. This result was in line with Omdia’s long term server and storage connectivity forecast. Factors driving that forecast include the growth in data sets, such as those computed by analytics algorithms looking for patterns, and the adoption of new software technologies like AI and ML which must examine large data sets to be effective, driving larger movement of data.
“Server virtualization and containerization reached new highs in 2019 and drove up server utilization. This increased server connectivity bandwidth requirements, and the need for higher speed Ethernet adapters” said Vlad Galabov, principal analyst for data center IT, at Omdia. “The popularization of data-intensive workloads, like analytics and AI, were also strong drivers for higher speed adapters in 2019”
25GE Ethernet adapters represented more than 25 percent of total data-center Ethernet adapter ports and revenue in 2019, as reported by Omdia’s Ethernet Network Adapter Equipment Market Tracker. Omdia also found that the price per each 25GE port is continued to decline. A single 25GE port cost an average of $81 in 2019, a decrease of $9 from 2018.
Despite representing a small portion of the market, 100GE Ethernet adapters are increasingly deployed by cloud service providers and enterprises running high-performance computing clusters. Shipments and revenue for 100GE Ethernet adapter ports both grew by more than 60 percent in 2019. Each 100GE adapter port is also becoming more affordable. In 2019, an individual 100GE Ethernet adapter port cost $321 on average, a decrease of $34 from 2018.
“Cloud service providers (CSPs) are leading the transition to faster networks as they run multi-tenant servers with a large number of virtual machines and/or containers per server. This is driving high traffic and bandwidth needs,” Galabov said. “Omdia expects telcos to invest more in higher speeds going forward—including 100GE—driven by network function virtualization (NFV) and increased bandwidth requirements from HD video, social media, AR/VR and expanded IoT use cases.”
The Ethernet outlook:
Omdia expects Ethernet adapter revenue to grow 21 percent on average each year through 2024. Despite the COVID-19 lockdown, the Ethernet adapter market is set to remain close to this growth curve in 2020.
Ethernet adapters that can provide complete on-card processing of network, storage or memory protocols, data-plane offload or that can offload server memory access will account for half of the total market revenue in 2020, or $1.1 billion. Ethernet adapters that have an onboard field customizable processor such as a field-programmable gate array (FPGA) or system on chip (SoC), will account for slightly more than than a quarter of 2020 adapter revenue, totaling $557 million. Adapters that only provide Ethernet connectivity will make up a minority share of the market, at just $475 million.
Intel maintains lead:
Looking at semiconductor vendor market share, Intel held 24 percent of the 2019 Ethernet adapter market, shipping adapters worth $424 million in 2019. This represents a 2.5-point decrease from 2018 that Omdia attributes to the aging Intel Ethernet adapter portfolio which consists primarily of 1GE and 10GE adapters with Ethernet connectivity only. Intel indicated it will introduce adapters with offload functionality in 2020 that will help it remain competitive in the market.
Mellanox (now part of NVIDIA) captured 21 percent of the 2019 Ethernet adapter market, a 1-point increase compared to 2018. The vendor reported strong growth of its 25GE and 100GE offload adapters driven by strong cloud service provider demand and growing demand among enterprises for 25GE networking.
Broadcom was the third largest Ethernet adapter vendor in 2019, commanding a 14 percent share of the market, an increase of 3 points from 2018. Broadcom’s revenue growth was driven by strong demand for high-speed offload and programmable adapters at hyperscale CSPs.
In 2019, Microsoft and Amazon continued to adopt in-house-developed Ethernet adapters. Given their large scale and the high value of their high-speed offload and programmable adapters, the companies cumulatively deployed Ethernet adapters worth over $300 million. This made them the fourth and fifth largest makers of Ethernet adapters in 2019. As both service providers deploy 100GE adapters in larger numbers in 2020, they’re set to remain key trendsetters in the market.
Amazon AWS and Microsoft Azure continued to use in-house-developed Ethernet adapters. Given their large scale and the high value of their high-speed offload and programmable adapters, the companies cumulatively deployed Ethernet adapters worth over $300 million, according to Omdia. This made Microsoft and Amazon, respectively, the fourth and fifth largest makers of Ethernet adapters in 2019. As both service providers deploy 100GE adapters in larger numbers in 2020, Omdia expects them to continue to be key trendsetters in the market going forward.
About Omdia:
Omdia is a global technology research powerhouse, established following the merger of the research division of Informa Tech (Ovum, Heavy Reading and Tractica) and the acquired IHS Markit technology research portfolio*.
We combine the expertise of over 400 analysts across the entire technology spectrum, analyzing 150 markets publishing 3,000 research solutions, reaching over 14,000 subscribers, and covering thousands of technology, media & telecommunications companies.
Our exhaustive intelligence and deep technology expertise allow us to uncover actionable insights that help our customers connect the dots in today’s constantly evolving technology environment and empower them to improve their businesses – today and tomorrow.
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Omdia is a registered trademark of Informa PLC and/or its affiliates. All other company and product names may be trademarks of their respective owners. Informa PLC registered in England & Wales with number 8860726, registered office and head office 5 Howick Place, London, SW1P 1WG, UK. Copyright © 2020 Omdia. All rights reserved.
*The majority of IHS Markit technology research products and solutions were acquired by Informa in August 2019 and are now part of Omdia.
Fastest 5G network in the U.S.? T-Mobile vs Verizon; Nokia’s fastest 5G claim
T-Mobile’s Salim Kouidri tweeted on Tuesday (see below) that their 5G network in New York City recently hit 1G bit/sec download speeds, at least in one recent test. Surprisingly, that 1 Gig connection didn’t even make use of T-Mobile’s low-band or millimeter wave (mmWave) spectrum holdings.
Salim Kouidri@salimkouidriA big milestone was achieved today @TMobile NYC. The team recorded a 1 Gigabit/s speed test on our newly launched 2.5Ghz 5G network in Manhattan @NevilleRay @MikeSievert #layercake #nationwide5G #wewontstop
- N41 (the 2.5GHz spectrum T-Mobile acquired from Sprint)
- B66 (the AWS spectrum T-Mobile is using to broadcast both 5G and 4G using EN-DC technology)
- And Band 46 (the unlicensed 5GHz band that T-Mobile is using to deploy LAA technology)
Therefore, the operator’s 1Gbit/s 5G connection didn’t even make use of T-Mobile’s low-band or high-band, mmWave spectrum holdings. Moreover, T-Mobile officials have said the operator is initially deploying only 60MHz of the roughly 150MHz it now owns in the 2.5GHz band. The inclusion of transmissions in those additional bands would undoubtedly increase users’ download speeds.
Although Australia’s Telstra, all three of South Korea’s operators, Sprint in the U.S. and the U.K.’s EE and Vodafone have all deployed 5G on mid-band spectrum, users’ speeds differed greatly from well over 200 Mbps on all three Korean operators, to 114.2 Mbps on Sprint. In part, this speed difference is because of the amount of 5G spectrum available to deploy — wider channels are better, ideally 100Mhz in a single 5G band — but it’s also due to other differences in the networks such as the capacity of the onward connection from each cell site or the performance of each operator’s core network.
As the new T-Mobile combines the assets of Sprint, we expect to see the average 5G speed of new T-Mobile users rising as they benefit from the mid-band 5G spectrum which Sprint has deployed.
The record speed was achieved by combining eight 100 MHz channels of millimeter wave spectrum on the 28 GHz and 39GHz bands, providing 800 MHz of bandwidth, and 40 MHz of LTE spectrum using the EN-DC functionality available on Nokia’s AirScale solution. EN-DC allows devices to connect simultaneously to 5G and LTE networks, transmitting and receiving data across both air-interface technologies. This means devices can achieve a higher throughput than when connecting to 5G or LTE alone. The speeds were achieved on both 5G cloud-based (vRAN) and classic baseband configurations.
Nokia’s AirScale Radio Access is an industry-leading, commercial end-to-end 5G solution enabling operators globally to capitalize on their 5G spectrum assets. It offers huge capacity scaling and market-leading latency and connectivity by enabling all air-interface technologies on the same radio access equipment.
Stéphane Téral, Chief Analyst at LightCounting Market Research, said: “This is a substantial achievement that reflects the careful workings of a brilliant and subtle team with the deepest appreciation for detail and circumstance. In other words, 8-component carrier aggregation in the millimeter wave domain shows the world that there is more than massive MIMO and open RAN to not only truly deliver the promise of commercial 5G, but also pave the way for future Terahertz system.”
Tommi Uitto, President of Mobile Networks at Nokia, commented: “This is an important and significant milestone in the development of 5G services in the U.S., particularly at a time when connectivity and capacity is so crucial. It demonstrates the confidence operators have in our global end-to-end portfolio and the progress we have made to deliver the best possible 5G experiences to customers. We already supply our mmWave radios to all of the major U.S. carriers and we look forward to continuing to work closely with them moving forward.”
Altiostar testing O-RAN Compliant 5G Massive MIMO with NEC and Rakuten Mobile
Altiostar announced testing of massive MIMO 5G over a virtual Radio Access Network (vRAN) in collaboration with NEC and Rakuten Mobile. The tests aim to ensure interoperability of multi-vendor systems based on the open RAN specifications from the O-RAN alliance.
Open RAN Layered Architecture from the O-RAN Alliance
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Altiostar is integrating the O-RAN Distributed Unit (O-DU) functionality of its virtual radio access network (vRAN) software with NEC’s O-RAN Radio Unit (O-RU) using fully compliant control, user, synchronization and management (C/U/S/M) plane protocols based on O-RAN Alliance guidelines. The 5G layer is built using container network functions (CNF) that leverage Rakuten Mobile’s cloud infrastructure platform that is part of its 4G network build out.
As part of management-plane integration, Altiostar is following a hierarchical model that allows the O-DU software to manage the NEC O-RU, including providing software upgrades, RU configuration, fault management and performance monitoring. This interoperability is being performed for 5G new radio (NR) sub-6 GHz massive MIMO O-RU and meets all the 3GPP downlink/uplink (DL/UL) requirements.
Altiostar says they have “pioneered RAN disaggregation since 2013 when it first introduced a split between the higher non-real-time layers of the protocol stack and the lower layers of the stack. The industry then standardized this concept in the 3GPP and what is now known as the option-2 split between the centralized unit and the distributed unit. This paved the way for operators to think differently when it comes to disaggregation and network deployment,” according to Altiostar.
Further disaggregation was introduced by Altiostar in the form of a radio interface unit. The RIU incorporates lower L1 functionality and provides a gateway function that converts Common Public Radio Interface to/from Ethernet. By eliminating the high bandwidth and proprietary CPRI interface to the radio, Altiostar took a key step towards integrating legacy Remote Radio Head over an Ethernet transport network to O-DU functionality.
Using this technology, the first multi-vendor RAN was deployed at a commercial scale and paved the way for operators to engage radio vendors to build O-RAN compliant radios. Rakuten Mobile’s adoption of the platform has helped move forward the ecosystem and open interfaces in the industry.
“Open RAN as a concept is one that the whole industry is now actively pursuing as a means to introduce supply chain diversity into mobile networks globally,” said Ashraf Dahod, CEO of Altiostar Networks. “Altiostar is leading the industry with this network transformation by ensuring interoperability, integration and most importantly extensive testing to ensure that we have a commercial, carrier-grade solution for both 4G and 5G while keeping the principles of Open RAN in place.”
“Rakuten Mobile is a big supporter of O-RAN principles and has seen the benefit of supply chain diversity in our own network,” said Tareq Amin, Representative Director, Executive Vice President and Chief Technology Officer of Rakuten Mobile. “By combining the spectral efficiency of massive MIMO along with an advanced cloud-based RAN, we are leveraging and introducing advanced innovative technology from both NEC and Altiostar, who are specialists in these respective fields.”
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References:
Verizon misleading 5G commercials called out by NAD after AT&T complaint
The National Advertising Division (NAD) has condemned Verizon for misleading consumers over the quality of its 5G network across the country. NAD recommended Verizon stop using the claim that it’s delivering “the most powerful 5G experience for America” in two previously aired TV commercials touting the carrier’s 5G service rollout in sports stadiums were challenged by 5G competitor AT&T.
Editor’s Note: NAD is an investigative unit of the advertising industry’s system of self-regulation and is a division of the BBB National Programs’ self-regulatory and dispute resolution programs.
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“The National Advertising Division has determined that, in the context of two challenged television commercials touting Verizon’s rollout of 5G service in sports venues, the claim that ‘Verizon is building the most powerful 5G experience for America’ reasonably communicates a message about the consumer experience of using 5G mobile service that was not supported by the evidence in the record,” according to statement from NAD.
The message is apparently that Verizon was not fairly representing its network in advertisements and promotions broadcast at sporting venues.
Verizon plans to appeal the ruling to the National Advertising Review Board.
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Verizon is building 5G networks in sporting venues across the U.S., though the NAD believes the way the advertisements have been created suggests a similar experience would be offered outside the sports venues themselves.
The express claim stated in the ads is that “Verizon is building the most powerful 5G experience for America,” a message the carrier indicated is clear to consumers, despite NAD’s finding that Verizon’s use of past and present tense conveys the message that it currently delivers the most powerful 5G experience.
“The intent of the commercial is to inform consumers about the billions of dollars Verizon is investing in its 5G buildout. Verizon strongly believes that consumers understand that this is the only message that is reasonably conveyed,” said Verizon in its advertiser’s statement.
NAD pointed to wording like “This is happening now,” for the NFL spots and said Verizon’s “unqualified superiority claim…goes beyond touting Verizon’s spectrum portfolio.” Instead, sending the message of 5G consumer experiences that include capacity to serve many people at once and using Verizon’s 5G network to post content, along with resilience, coverage and latency – which NAD said Verizon didn’t provide sufficient evidence to support its present tense “most powerful network” claim.
Based on the context, one commercial the NAD release appears to be referring to is a Verizon NFL 5G Built Right ad, which Jeffrey Moore, principal at Wave7 Research, confirmed ran heavily in September 2019 in line with the start of NFL season and stopped airing November 18.
“5G branding efforts from Verizon, AT&T, and T-Mobile shifted to pandemic-related branding, showing that Verizon, AT&T, and T-Mobile are doing what they can to keep customers connected and safe,” Moore told Fierce Wireless.
Verizon announced last September it was expanding 5G service to 13 NFL stadiums. Given current restrictions on large public gatherings in many places though, it’s unclear when ads depicting massive crowds might come back into favor.
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U.S. based wireless telcos are facing a difficult challenge in delivering the desired “5G experience.” Despite the telcos preaching about the benefits of mmWave spectrum to underpin 5G networks, the telcos are performing woefully according to many critics/pundits.
T-Mobile has been blasted for the speeds which have been delivered over the 600 MHz spectrum it has been offering, while AT&T and Verizon has been failing at coverage. In a recent Rootmetrics gaming study in Los Angeles, none met the minimum requirements for latency.
Moore noted that Metro By T-Mobile’s “Rule Your Day” campaign, was halted for a period, but restarted May 6. On the postpaid side, T-Mobile’s message for a time was “We’re with you,” but has now returned to the tagline of “Are you with us?”
This “slap on the wrist” by NAD implies that the U.S. is failing to even come close to meeting its own inflated promises in the delivery of 5G service.
For an excellent analysis and comparison of exaggerated 5G claims by Verizon vs AT&T, please see this blog post by Adrian Diaconescu.
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References:
https://telecoms.com/504372/verizon-gets-wrist-slap-for-misleading-5g-claims/
https://www.phonearena.com/news/verizon-misleading-5g-advertisingatt-complaint_id124706
Verizon misleading 5G commercials called out by NAD after AT&T complaint
The National Advertising Division (NAD) has condemned Verizon for misleading consumers over the quality of its 5G network across the country. NAD recommended Verizon stop using the claim that it’s delivering “the most powerful 5G experience for America” in two previously aired TV commercials touting the carrier’s 5G service rollout in sports stadiums were challenged by 5G competitor AT&T.
Editor’s Note: NAD is an investigative unit of the advertising industry’s system of self-regulation and is a division of the BBB National Programs’ self-regulatory and dispute resolution programs.
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“The National Advertising Division has determined that, in the context of two challenged television commercials touting Verizon’s rollout of 5G service in sports venues, the claim that ‘Verizon is building the most powerful 5G experience for America’ reasonably communicates a message about the consumer experience of using 5G mobile service that was not supported by the evidence in the record,” according to statement from NAD.
The message is apparently that Verizon was not fairly representing its network in advertisements and promotions broadcast at sporting venues.
Verizon plans to appeal the ruling to the National Advertising Review Board.
……………………………………………………………………………………………………………………………….
Verizon is building 5G networks in sporting venues across the U.S., though the NAD believes the way the advertisements have been created suggests a similar experience would be offered outside the sports venues themselves.
The express claim stated in the ads is that “Verizon is building the most powerful 5G experience for America,” a message the carrier indicated is clear to consumers, despite NAD’s finding that Verizon’s use of past and present tense conveys the message that it currently delivers the most powerful 5G experience.
“The intent of the commercial is to inform consumers about the billions of dollars Verizon is investing in its 5G buildout. Verizon strongly believes that consumers understand that this is the only message that is reasonably conveyed,” said Verizon in its advertiser’s statement.
NAD pointed to wording like “This is happening now,” for the NFL spots and said Verizon’s “unqualified superiority claim…goes beyond touting Verizon’s spectrum portfolio.” Instead, sending the message of 5G consumer experiences that include capacity to serve many people at once and using Verizon’s 5G network to post content, along with resilience, coverage and latency – which NAD said Verizon didn’t provide sufficient evidence to support its present tense “most powerful network” claim.
Based on the context, one commercial the NAD release appears to be referring to is a Verizon NFL 5G Built Right ad, which Jeffrey Moore, principal at Wave7 Research, confirmed ran heavily in September 2019 in line with the start of NFL season and stopped airing November 18.
“5G branding efforts from Verizon, AT&T, and T-Mobile shifted to pandemic-related branding, showing that Verizon, AT&T, and T-Mobile are doing what they can to keep customers connected and safe,” Moore told Fierce Wireless.
Verizon announced last September it was expanding 5G service to 13 NFL stadiums. Given current restrictions on large public gatherings in many places though, it’s unclear when ads depicting massive crowds might come back into favor.
…………………………………………………………………………………………………………..
U.S. based wireless telcos are facing a difficult challenge in delivering the desired “5G experience.” Despite the telcos preaching about the benefits of mmWave spectrum to underpin 5G networks, the telcos are performing woefully according to many critics/pundits.
T-Mobile has been blasted for the speeds which have been delivered over the 600 MHz spectrum it has been offering, while AT&T and Verizon has been failing at coverage. In a recent Rootmetrics gaming study in Los Angeles, none met the minimum requirements for latency.
Moore noted that Metro By T-Mobile’s “Rule Your Day” campaign, was halted for a period, but restarted May 6. On the postpaid side, T-Mobile’s message for a time was “We’re with you,” but has now returned to the tagline of “Are you with us?”
This “slap on the wrist” by NAD implies that the U.S. is failing to even come close to meeting its own inflated promises in the delivery of 5G service.
For an excellent analysis and comparison of exaggerated 5G claims by Verizon vs AT&T, please see this blog post by Adrian Diaconescu.
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References:
https://telecoms.com/504372/verizon-gets-wrist-slap-for-misleading-5g-claims/
https://www.phonearena.com/news/verizon-misleading-5g-advertisingatt-complaint_id124706
U.S. Government Attempts to Strangle Huawei; China-U.S. Trade War likely to Accelerate into HYPER-DRIVE mode
On Friday, the U.S. government said it would impose export restrictions designed to cut off Chinese tech giant Huawei Technologies Co. from overseas suppliers, threatening to ignite a new round of U.S.-China trade tensions. The U.S. Commerce Department said its new sanctions would “narrowly and strategically target Huawei’s acquisition of semiconductors that are the direct product of certain U.S. software and technology.”
These new restrictions stop foreign semiconductor manufacturers whose operations use U.S. hardware, software and technology from shipping products to Huawei without first getting a license from U.S. officials, essentially giving the U.S. Commerce Department a veto over the kinds of technology that Huawei can use.
The restriction further tightens the U.S. export-control system’s existing rules related to Huawei. Washington alleges that Huawei gear could be used by Beijing to spy globally, which Huawei has repeatedly denied.
A logo of Huawei retail shop is seen through a handrail inside a commercial office building in Beijing.
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U.S. Commerce Secretary Wilbur Ross said Friday that Washington wants to prevent Huawei from evading sanctions imposed earlier on its use of American technology to design and produce semiconductors abroad. “There has been a very highly technical loophole through which Huawei has been able, in effect, to use U.S. technology with foreign fab producers,” Ross said in an interview on Fox Business Network. He said the changes announced Friday were tailored moves “to try to correct that loophole and make sure that the American fab foundries are competing on an equal footing with the foreign ones.”
Also on Friday, a senior administration official said there were “legal, human rights, and strategic rationales” for the actions against Huawei. Those included Huawei’s alleged theft of intellectual property and aid in developing surveillance technology and new weapon systems, the official said.
Under the new rules, the department can block the sale of semiconductors manufactured by Taiwan Semiconductor Manufacturing (TSMC) for Huawei’s HiSilicon subsidiary, which designs chips for the company, as well as chips and other software produced by manufacturing facilities in Taiwan, China and South Korea, which use American chip-making technology. The Commerce Department already had the ability to license software shipments from U.S.-based facilities.
Companies can apply for a license to continue supplying tech products to Huawei, but the administration said the presumption would be to deny those requests.
John Neuffer, the president of the Semiconductor Industry Association, which represents chip makers, said his group was concerned that the rule would “create uncertainty and disruption for the global semiconductor supply chain.” He added, however, that it appeared less damaging than broader approaches the administration had previously considered.
Huawei had no immediate comment.
China’s foreign ministry, in a statement, urged the U.S. to immediately halt “its unreasonable suppression against Huawei.”
“The U.S.’s practices not only harm the legitimate rights and interests of Chinese enterprises, but also do not accord with the interests of U.S. enterprises, and cause damage to the global industrial chain, supply chain and value chain,” it said.
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On Sunday, China’s commerce ministry said it will take “all necessary measures” in response to new U.S. restrictions on Chinese tech giant Huawei’s ability to use American technology, calling the measures an abuse of state power and a violation of market principles.
An unidentified spokesperson quoted Sunday in a statement on the China ministry’s website said the regulations also threatened the security of the “global industrial and supply chain.”
“The U.S. has utilized national power and used the so-called national security concern as an excuse, and abused export controls to continue to suppress some particular companies in other countries,” China’s commerce ministry said in today’s statement.
“China urges the U.S. to immediately cease its wrong actions,” the ministry added, calling the restrictions a “serious threat to global supply chains.”
China’s retaliation could take the form of restrictions on U.S. tech firms (Qualcomm, Apple. Intel, Nvidia, AMD, Broadcom, Cisco, even Boeing) selling their products in China.
Victor Gao, vice-president of the Centre for China and Globalisation, a Beijing-based think tank, said there were many ways in which China could retaliate for the new restrictions on Huawei, including selling its huge holdings of U.S. treasury bonds or halting any future purchases, and tightening its controls on Apple products.
“For example, if Beijing declared that all Apple products made in China had to be inspected, which would delay their shipment, in three months, Apple would be dead,” he said.
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China’s state-run newspaper reported on Sunday that the Chinese government was ready to retaliate against the U.S.. The source, who is described as close to China’s government, told the state-run Global Times that China was planning countermeasures, such as “imposing restrictions” against U.S. companies like Apple, Cisco, and Qualcomm. The source also suggested the possibility of China halting Boeing airplane purchases.
“China will take forceful countermeasures to protect its own legitimate rights” if the Trump administration goes ahead with the plan to block essential suppliers of semiconductors from selling those components to Huawei.
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Backgrounder:
U.S. government officials have repeatedly accused Huawei of stealing American trade secrets and aiding China’s espionage efforts, ramping up tensions with the rival superpower while both sides were involved in a long-simmering trade war.
As a result, Huawei has increasingly relied on domestically manufactured technology, but the latest rules will also ban foreign firms that use US technology from make semiconductors to Huawei without US permission. The new restrictions will cut off Huawei’s access to one of its major suppliers of semiconductors- Taiwanese chipmaker TSMC (world’s largest silicon foundry).
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May 18th UPDATE:
Huawei on Monday assailed the latest U.S. move to cut it off from semiconductor suppliers as a “pernicious” attack that will put the Chinese technology giant in “survival” mode and sow chaos in the global technology sector.
“The decision was arbitrary and pernicious and threatens to undermine the entire (technology) industry worldwide. This new rule will impact the expansion, maintenance, and continuous operations of networks worth hundreds of billions of dollars that we have rolled out in more than 170 countries,” Huawei said in a statement.
The ban also went against the US government’s claim that it is motivated by network security, the company said.
“The US is leveraging its own technological strengths to crush companies outside its own borders. This will only serve to undermine the trust international companies place in US technology and supply chains. Ultimately, this will harm US interests,” said Huawei.
https://www.globaltimes.cn/content/1188683.shtml
References:
https://www.wsj.com/articles/u-s-moves-to-cut-off-chip-supplies-to-huawei-11589545335
https://abcnews.go.com/US/wireStory/china-warns-us-measures-huawei-rules-70728162
http://www.globaltimes.cn/content/1188491.shtml
Microsoft acquires Metaswitch Networks to deliver on promise of 5G
Microsoft has agreed to buy Metaswitch Networks, a provider of virtualized network software and voice, data and communications services aimed at network operators. No financial details were provided. Microsoft revealed the deal in this blog post.
This acquisition builds on Microsoft’s buy out of Affirmed Networks, which was completed on April 23rd. Metaswitch’s cloud-native communications software is expected to expand the range of offerings available for the telecom industry, especially as it moves to 5G.
Both newly-acquired companies will be used to extend Microsoft’s Azure cloud platform to both deploy and grow these capabilities at scale. The focus will be on interoperability, with radio access networks (RAN), next-generation core, virtualized services, orchestration and operations support system/business support system (OSS/BSS) modernization.
Evidently, Microsoft wants to position its Azure cloud platform as a key foundation for mobile operators’ 5G plans, providing a cloud-native and flexible platform upon which CSPs can run their network elements. That will particularly come into play as edge computing starts to play a role in distributed telco cloud platform strategies and as more and more operators strike partnerships with the cloud giants.
“As cloud and communication networks converge, Microsoft intends to leverage the talent and technology of these two organizations and extend the Azure platform to deploy and grow these capabilities at scale in a way that is secure, efficient and creates a sustainable ecosystem,” noted Microsoft in its announcement.
In acquiring Affirmed and Metaswitch, Microsoft has dramatically increased its telecoms know-how. Metaswitch in particular has a long history of innovation in the telecoms market and, as its case study pages on its website show, it works with most of the top telcos around the world. Microsoft will get a lot of ready-made relationships with this acquisition too.
In his statement on the deal, Metaswitch CEO Martin Lund stressed that heritage and deep set of telecoms industry relationships:
Throughout its history, Metaswitch has been recognized as a trusted, independent developer of critical networking software, delivering products and solutions worldwide to more than 1,000 communications service providers and network equipment providers. We built a continuously innovative, growing, well-respected and profitable business. We have fueled the telecommunications industry through multiple technology eras and evolutions, most recently pioneering the development of ultra-high-performance cloud native communications software. This software is underpinning modern cloud-based communication networks, in the core and at the edge, and has driven today’s announcement with Microsoft.
I have been honored by the customers who have put their trust in us, aware that we are only as successful as those we serve and committed to delivering products and solutions that meet their needs and add real business value. We have innovated, disrupted, and delivered together. And now, I am more excited than ever to continue our journey with the added momentum, technology, services, and people that Microsoft can bring. We will continue to meet customers where they are, working together as communication service providers evolve their own operations. And we’ll be ideally placed to aid those operators keen to transition to cloud native deployments, to 5G networks and to the era of compelling applications that are served from the core and edge of new network architectures. I look forward to working with all our existing customers and new prospects alike, as we embark on the next leg of our mutual growth and evolution.
It’s hard to argue with that assessment. Metaswitch, as well as supplying telcos around the world with technology that enables key functionality such as VoIP, VoLTE, VoWiFi, session border control, robocall blocking, converged voice and data messaging and many more, it has been a leading player in developing cloud-native core network functionality that will be vital to next-generation networks and service enablement. Metaswitch is also a big proponent of O-RAN as noted in this blog post.
But the move may also cause some unease amongst the network operators, which will want assurance from Microsoft that their relationships with Metaswitch and Affirmed will not be steered down routes they don’t necessarily prefer and, particularly in the case of Metaswitch, they will want to know that a range of traditional telecom products and services won’t suddenly get an ‘end of life’ stamp because they are not cloud-friendly.
That may not happen immediately, but the writing may be on the wall. Microsoft notes in its blog about the deal:
We have a long history of working with operators as they increasingly embrace software-based solutions and continue to support the advancement of cloud-based networking while helping create new partnership opportunities for existing network equipment providers. Our intention over time is to create modern alternatives to network infrastructure, enabling operators to deliver existing and value-added services – with greater cost efficiency and lower capital investment than they’ve faced in the past.
These two Microsoft additions to bolster Azure begs the question of what Amazon AWS and Google Cloud do to be the cloud platform partner of choice for the telcos?
References:
https://www.metaswitch.com/knowledge-center/reference/what-is-an-open-radio-access-network-o-ran
2020 not the year of 5G for Canada; COVID-19 and Huawei gear at issue
While AT&T plans to have U.S. nationwide 5G coverage in place by this summer, Canada’s 5G plans have been dashed due to the COVID-19 pandemic.
Bell Canada had announced that its initial 5G network was ready to be switched on, but it now says the ongoing pandemic is the wrong time to do so.
Bell Canada’s CEO Mirko Bibic said during a conference call with investors: “We are ready with our initial 5G network, but frankly we don’t think that it’s the right time right now to officially launch it for marketing purposes. I just don’t think that customers are paying attention to this right now and that’s not what is top of mind for our customer base. They have other priorities, understandably,” Bibic said.
“As the economy opens up, we’ll have more news on when we will launch our initial 5G services,” he added.
Bell Canada started the construction of its 5G network this year, using equipment from Nokia.
The CEO said that Bell Canada is still waiting for the Canadian government’s decision on the security review of 5G networks. Officials had received pressure from the U.S. government to ban Chinese carrier Huawei from the deployment of 5G networks in the country, over security allegations.
“We are waiting for the (Canadian) government’s decision and we will follow all government rules with respect to usage of equipment in our 5G network and as you know, we work with multiple suppliers in our supply chain,” he said.
Mr. Bibic has previously said that Bell will continue to enhance 5G access speeds, capacity and coverage as additional 5G wireless spectrum, including in the 3.5 GHz band, becomes available this year through the federal government’s spectrum auction process. Bibic said that the award of that spectrum will allow Canadian carriers to launch more 5G technology in 2021.
Picking up the pieces of the 5G jigsaw puzzle!
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Bell Canada’s rival Telus seems to be having similar problems when it comes to launching 5G. The company announced it would be “rolling out its 5G network shortly” in February. However, this network will use Huawei infrastructure, which could prove a big problem if Canada finally decides to ban or limit the use of this equipment.
The Canadian government has been reviewing Huawei’s role in their national 5G infrastructure since last year, and the lack of decision is likely the cause for Telus’ 5G delay.
That leaves Rogers as the only Canadian operator to have launched 5G so far, doing so in handful of cities back in March using Ericsson equipment.
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The Canadian government is expected to auction 3.5 GHz spectrum in Q4 of this year, which will likely see all of the country’s major operators jump at the chance to expand their spectrum holdings. Many similar auctions around the world have been delayed due to uncertainty surrounding the pandemic, but so far the Canadian auction is scheduled to continue as planned.
References:
https://www.totaltele.com/505921/Canadas-5G-stalls-in-face-of-pandemic
AT&T Execs Talk up “Broadband Resiliency” and 5G with mixed impact from COVID-19
John Stankey, president and chief operating officer, and incoming CEO of AT&T Inc. talked up broadband, HBO Max, and 5G today at the J.P. Morgan Global Technology, Media and Communications Conference. Stankey said the company’s market focus is on providing customers with broadband through its fiber and mobile networks and software-based entertainment offerings such as HBO MAX and AT&T TV. More importantly, he reaffirmed AT&T’s plan to have a nationwide 5G network in place by this summer (that’s long before 3GPP Release 16 can be implemented or ITU IMT 2020 standard completed).
In the midst of the COVID-19 pandemic, Stankey said the resiliency of AT&T’s wireless, broadband and enterprise businesses provides the company with confidence in its ability to continue to generate strong cash flows to invest in key capital areas including fiber, 5G and HBO Max, comfortably cover its dividend and pay down debt. Additionally, he noted that it continues to be challenging to predict the length or depth of the pandemic’s overall economic impact or its effect on the company’s overall business.
Here are a few highlight telecom related quotes from Stankey:
“Wireless business at its core remains very strong, but the activity environment is a bit suppressed primarily because of distribution. Roaming dynamics have put some pressure on revenues but the core is looking very good.”
“On the SMB side, its a little early to tell if they’ll be a bounceback,” referring to the uncertainty of when many SMBs will re-open. “I think we’ll be in a fairly slow climb back out of the low end of the market. I don’t expect this to be a quick snap-back this year.”
“We want customers to start thinking about connectivity (and content) so we can grow our advertising business over time HBO Max is the front end of our entertainment distribution platform.” He noted that both HBO Max and AT&T TV are software based (OTT TV packages) that are independent of the underlying transmission/ delivery network.
“Any discretionary consumer spending will be under review” in light of the economic hardships and distress imposed by COVID-19 stay at homes. That will likely result in more cord cutting and reduced spending on traditional pay TV bundles.
Nationwide 5G coverage by mid-year:
“It’s going well. We’re starting from a very strong position. Our embedded (cellular) network is performing as well or better than any network out there. We’ve added over 70% capacity since the end of 2017 and are broad spectrum holding (mmW, midband and lowband) for which we have the flexibility to allocate traffic to all of those, puts us in excellent position for deploying 5G.”
“In the summer we’ll have nationwide coverage of 5G. Our customer base over- indexes (?) on Apple products, but Apple hasn’t announced a 5G product yet…. I feel great on how things are lining up.”
What 5G enables when widely deployed:
” A highly managed WAN with incredible levels of security that supports the kind of environments we’re in today. It plays very well into the enterprise. New business models will emerge, including manufacturing floor, medical communities and establishments.”
AJW Comment: This reiterates that AT&T continues to focus its 5G strategy on enterprise customers vs consumers and we think that is where the growth will be, especially if ultra low latency and ultra high reliability are added to the 5G specs (those two capabilities are not nearly complete in 3GPP Release 16 and non-existent in the ITU-R IMT 2020 RIT/SRITs being progressed.
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Yesterday, AT&T CFO John Stevens told a Moffet-Nathanson virtual conference that the businesses that come out of the COVID-19 crisis in good financial shape may want to take advantage of 5G-related cost efficiencies.
“Businesses that are going through this who do have solid balance sheets, solid capabilities, good technology – they may want to move quicker to 5G to ring out the cost savings and efficiencies,” he said, adding the situation remains “wait and see.”
Stephens acknowledged that COVID-19 damage may also cause AT&T to lose business customers. “Certainly some opportunities will go away” from companies facing financial pressures and restrictions to credit amid the coronavirus-related economic downturn.
The timeline for monetizing consumer 5G hasn’t been impacted since AT&T didn’t expect to generate significant consumer service revenues from 5G any time soon, instead anticipating 5G applications to be targeted at business users.
“Those [business] applications will be turned into consumer applications over time, so we feel really good about getting the network out there before significant growing demand for 5G on the consumer side,” Stephens said.
At the start of the year, AT&T had expected a major handset upgrade cycle, coinciding with its expanded 5G network deployment and HBO Max launch. With a significant portion of its retail stores closed, alongside high unemployment rates and possible tightened consumer spending, AT&T anticipates reduced activity – as was seen in March, when device sales dropped 25%.
Consumers may put off purchasing devices as they conserve financial resources, but a weak upgrade cycle won’t affect AT&T’s profitability, according to Stephens.
“The way we’re building toward 5G on an evolutionary basis, we are dramatically improving our LTE coverage and speeds along the way, so the customers we have get the benefit of what we’ve done with the equipment that’s in their hands today,” he said. “They don’t need to buy a new device,” although they do expect 5G to provide the opportunity to do that if they opt to.
In terms of mid-band spectrum compared to competitors, with T-Mobile’s new 2.5 GHz holdings and Verizon expected to participate in the C-Band auction later this year, Stephens said that AT&T’s work getting about 150 MHz of new spectrum into service has put the company in a favorable position for low-and mid-band spectrum.
Stephens couldn’t comment on the upcoming CBRS auction, but said C-band would be interesting to participate in and is confident in AT&T’s ability to fund spectrum acquisitions. Still, AT&T feels very good with its current spectrum holdings, which he stressed are already in service for customers.
References:
https://about.att.com/story/2020/stankey_jp_morgan.html
https://www.fiercewireless.com/operators/at-t-staying-steady-strategy-cfo
AT&T Execs Talk up “Broadband Resiliency” and 5G with mixed impact from COVID-19
John Stankey, president and chief operating officer, and incoming CEO of AT&T Inc. talked up broadband, HBO Max, and 5G today at the J.P. Morgan Global Technology, Media and Communications Conference. Stankey said the company’s market focus is on providing customers with broadband through its fiber and mobile networks and software-based entertainment offerings such as HBO MAX and AT&T TV. More importantly, he reaffirmed AT&T’s plan to have a nationwide 5G network in place by this summer (that’s long before 3GPP Release 16 can be implemented or ITU IMT 2020 standard completed).
In the midst of the COVID-19 pandemic, Stankey said the resiliency of AT&T’s wireless, broadband and enterprise businesses provides the company with confidence in its ability to continue to generate strong cash flows to invest in key capital areas including fiber, 5G and HBO Max, comfortably cover its dividend and pay down debt. Additionally, he noted that it continues to be challenging to predict the length or depth of the pandemic’s overall economic impact or its effect on the company’s overall business.
Here are a few highlight telecom related quotes from Stankey:
“Wireless business at its core remains very strong, but the activity environment is a bit suppressed primarily because of distribution. Roaming dynamics have put some pressure on revenues but the core is looking very good.”
“On the SMB side, its a little early to tell if they’ll be a bounceback,” referring to the uncertainty of when many SMBs will re-open. “I think we’ll be in a fairly slow climb back out of the low end of the market. I don’t expect this to be a quick snap-back this year.”
“We want customers to start thinking about connectivity (and content) so we can grow our advertising business over time HBO Max is the front end of our entertainment distribution platform.” He noted that both HBO Max and AT&T TV are software based (OTT TV packages) that are independent of the underlying transmission/ delivery network.
“Any discretionary consumer spending will be under review” in light of the economic hardships and distress imposed by COVID-19 stay at homes. That will likely result in more cord cutting and reduced spending on traditional pay TV bundles.
Nationwide 5G coverage by mid-year:
“It’s going well. We’re starting from a very strong position. Our embedded (cellular) network is performing as well or better than any network out there. We’ve added over 70% capacity since the end of 2017 and are broad spectrum holding (mmW, midband and lowband) for which we have the flexibility to allocate traffic to all of those, puts us in excellent position for deploying 5G.”
“In the summer we’ll have nationwide coverage of 5G. Our customer base over- indexes (?) on Apple products, but Apple hasn’t announced a 5G product yet…. I feel great on how things are lining up.”
What 5G enables when widely deployed:
” A highly managed WAN with incredible levels of security that supports the kind of environments we’re in today. It plays very well into the enterprise. New business models will emerge, including manufacturing floor, medical communities and establishments.”
AJW Comment: This reiterates that AT&T continues to focus its 5G strategy on enterprise customers vs consumers and we think that is where the growth will be, especially if ultra low latency and ultra high reliability are added to the 5G specs (those two capabilities are not nearly complete in 3GPP Release 16 and non-existent in the ITU-R IMT 2020 RIT/SRITs being progressed.
………………………………………………………………………………………………………………………………………………
Yesterday, AT&T CFO John Stevens told a Moffet-Nathanson virtual conference that the businesses that come out of the COVID-19 crisis in good financial shape may want to take advantage of 5G-related cost efficiencies.
“Businesses that are going through this who do have solid balance sheets, solid capabilities, good technology – they may want to move quicker to 5G to ring out the cost savings and efficiencies,” he said, adding the situation remains “wait and see.”
Stephens acknowledged that COVID-19 damage may also cause AT&T to lose business customers. “Certainly some opportunities will go away” from companies facing financial pressures and restrictions to credit amid the coronavirus-related economic downturn.
The timeline for monetizing consumer 5G hasn’t been impacted since AT&T didn’t expect to generate significant consumer service revenues from 5G any time soon, instead anticipating 5G applications to be targeted at business users.
“Those [business] applications will be turned into consumer applications over time, so we feel really good about getting the network out there before significant growing demand for 5G on the consumer side,” Stephens said.
At the start of the year, AT&T had expected a major handset upgrade cycle, coinciding with its expanded 5G network deployment and HBO Max launch. With a significant portion of its retail stores closed, alongside high unemployment rates and possible tightened consumer spending, AT&T anticipates reduced activity – as was seen in March, when device sales dropped 25%.
Consumers may put off purchasing devices as they conserve financial resources, but a weak upgrade cycle won’t affect AT&T’s profitability, according to Stephens.
“The way we’re building toward 5G on an evolutionary basis, we are dramatically improving our LTE coverage and speeds along the way, so the customers we have get the benefit of what we’ve done with the equipment that’s in their hands today,” he said. “They don’t need to buy a new device,” although they do expect 5G to provide the opportunity to do that if they opt to.
In terms of mid-band spectrum compared to competitors, with T-Mobile’s new 2.5 GHz holdings and Verizon expected to participate in the C-Band auction later this year, Stephens said that AT&T’s work getting about 150 MHz of new spectrum into service has put the company in a favorable position for low-and mid-band spectrum.
Stephens couldn’t comment on the upcoming CBRS auction, but said C-band would be interesting to participate in and is confident in AT&T’s ability to fund spectrum acquisitions. Still, AT&T feels very good with its current spectrum holdings, which he stressed are already in service for customers.
References:
https://about.att.com/story/2020/stankey_jp_morgan.html
https://www.fiercewireless.com/operators/at-t-staying-steady-strategy-cfo