Recently, I had the privilege of giving a keynote for the TIA (Telecommunications Industry Association) Trade Show 2011 in Dallas Texas. It was such an honor to share the stage with the likes of Grant Sieffert, President of TIA, Tony Melone, EVP, CTO of Verizon, Charles Vogt, CEO of Genband and Jeff Gardner, CEO of Windstream.
I received feedback that the keynote went well & we had around 400 people in the audience, but as you know – if I blog about the keynote themes we could extend that reach – hence this post! However, you have to bear with me, the enthusiasm may be a bit over the top since this is one of the LAST things I’m doing before I had off on sabbatical (yes, Intel *is* a great company to work for) [:)]
I kicked off the keynote with an observation on “Pace of Innovation” – think about it – in communications, it took almost 150 years to go from the first phone call to the pervasiveness of the home phone to the cordless phones and cell phones to the point where my Smart Phone is no longer my ‘phone’ it’s my constant companion. But what about computers? From the early days of the ENIAC, to my first vax terminal to the Original IBM PC weighing about 10 kg to the today’s ultra thin and light mobile computers and tablets - all of that happened in about 70 years – or less than half the time of the phone.
But these two worlds are colliding - computers communicate and phones compute. So as these worlds collide - we will see the pace of innovation in communications change? Change not only in devices but also in the infrastructure that supports it? As both industries face challenges on power costs, effective utilization and management - can the technology be re-used? I truly see a transformational change ahead of us in "Inside the Network" and I ask you "Can we accelerate the pace of innovation by blending the quality of communications with the pace of IT to meet the needs of a dynamic, constrained network?
We’ve all seen the data:
• 20Bn+ devices, traffic growing 200X , Mobile traffic growing 25x over the next 10 years
• Video 40%+ of mobile traffic today growing to 90%
• M2M is driving a new class of connected device that need to be managed and serviced
In the May ‘11 Sandvine Report it was reported that in North America - Netflix is now 29.7% of peak downstream traffic and has become the largest source of Internet traffic overall. In, Latin America, Social Networking (overwhelmingly Facebook) is a bigger source of traffic than YouTube. Across the globe, real time entertainment is becoming a significant source of traffic.
This growth is fueled by device CAPABILITY – my phone is my companion, user BEHAVIORS, and Broadband AVAILABILITY. But in most cases – the tone in the industry is one of ‘crisis’ – can the networks scale? Are biz model broken? The demands on the network will require a build out – but this isn’t a crisis,it’s also an opportunity for growth and innovation! When you look at how many companies have constructed their networks – with the enterprise, access, edge, and core layers – there is a parallelism with the transformation we saw in Data Centers in the 1990s. Companies moved from highly proprietary systems to very standard servers, that are scalable and flexible, foster innovation and reasonably priced. So the question before the operators is: Do we build out networks as they always have or look for a more flexible paradigm? What if carriers took a more unified, scalable, cloud-based infrastructure approach?
A friend once told me, there are 3 Fundamental Objectives in Business: Make $$, Save $$, and stay out of Jail! [:)] During the Telco 2.0 executive brainstorm last year, we heard that between 30% and 50% of telco growth over three years will be from new business models - Make $$. And with that fast growth, the remainder of the growth will come from improvements to their current business model - Save $$. What this really comes down to is, can service providers leverage their assets: Fast, reliable, secure networks, managed customer relationship, and rich subscriber info to deliver new services revenue?
Some examples of new revenue opportunities via services may include :
• Location-based advertising combined with user demographics
• Home energy management services
• M2M services: largely untapped today but with lots of potential in the future
• Premium offerings: Managing end-to-end service throughput and latencies, for a price
The key to success is the FLEXIBILITY to quickly enable an emerging service on a known platform configuration. History is littered with examples where first mover advantages have resulted in huge windfalls. A recent quote from Yankee Group’s Jennifer Pig noted: “Service providers are in a unique position in that they have access to both subscriber and network information. The intelligent network can add rich contextual information about when, where and how subscribers are using their devices and applications on the network… and can be leveraged to monetize a wide variety of use cases”
But what is the “Intelligent or Smart” Network? We think there are 3 key properties:
1. Add Intelligence close to the user
2. Insist on an open, flexible, extensible architecture
3. Enable and Expand an ecosystem focused on innovation
Historical focus used to be on isolated optimization. Should we provide optimization for each small sub-component or drive flexibility for all? We believe they need to focus on SCALE – so networks can accommodate increasing levels of traffic in a more efficient manner - in other words build one platform and use many times... With common hardware platforms enabling multiple software network applications, which brings us back to => SAVE $$. What will also help is driving for FLEXIBILITY – which will enable platforms that can monetize new services => MAKE $$.
So I’ve mentioned the blending of comms and computing to deliver these Smart Networks… But, what do both industries bring to the party in terms of technology and capability? From the comms world we have: HW density, high speed, low latency, robust, high quality of service, determinism, real time IO switching. On the computing side we have technolgies that enable: dynamic resource sharing, dynamic workload migration, security, open APIs, developer communities, virtualization, power management, all standards based,
As an industry we need to proactively close the gap between comms/compute requirements and drive transition strategies to open, standards based networks. But is this idea of the blending of communications/computing a twinkle in someone’s eye? Just great PowerPoint? No – it’s being driven and piloted by some of the world’s leading service providers! For example, at IDF Beijing, 2011, Dr Huang spoke of the drive towards Cloud RAN a collaboration with Intel. By the end of 2010, they had deployed 720K base stations. As these deployment continue to growth, the goal of their C-RAN was to reduce both CAPEX & OPEX – and provide best customer service. There are similar initiatives taking place with KT/Samsung, including other engagements to understand a similar approach in networks where fiber doesn’t exist. Another example is Verizon – their network has become complex and costly – not benefiting Moore’s Law like the computing industry.
They found they had:
• Too many boxes and interconnections between boxes
• Too many signaling & control protocols
• Too much power consumption
• Trouble shoehorning connection-oriented services onto IP
So, the Verizon’s Solution was to design a Network based on today’s technologies which would support the behavior of applications & user needs. They collapse functions into fewer boxes, which in turn, improved their scaling and stability issues. Another project was to automate network with a simple set of signaling & control protocols, thereby reducing OpEx. And of course, they leveraged technologies that are tracking with Moore’s Law to gain that benefit. In the end, they found that the key was: Architectural Flexibility!
Service Providers are demonstrating that flexible, scalable networks leveraging standards based computing technologies cannot only deliver more efficient networks (SAVE $$) but also deliver intelligence for tomorrows next generation service (MAKE $$). We believe the explosive growth in data, the ever changing use models, and growing bandwidth requirements are creating an opportunity for transformational change in network architectures. Operators are in a unique position to leverage assets to deliver new services. By blending and optimizing the best practices and technology of IT and communications, they create platform landing pads to deliver scalable, service oriented networks
I look back fondly on my days with my VAX terminal and my LONG corded telephone and today I’m addicted to the convergence of communications and computing on my smart phone. However as I look forward to what’s Inside our future networks I wonder if we are enabling the networks to be ‘good enough’ or creating an asset that delivers ‘amazing’ experiences and services for consumers and enterprises alike… I would prefer to strive for amazing…
So, that’s it, the sumary of my keynote. As I mentioned above, I’ll be going off on sabbatical for 2 months, but this blog will be getting watched so your comments will get responses, so let us know how we can help you or what you think of the above. Also, I’d like you to keep an eye out for Steve Price who will be covering for me while I’m gone and will get to write at least a few blogs. I’ve also got great folks like Jim St. Leger and Robert Hunter in my group that are out there in the social media channels if you have questions.
Thanks & Have a GREAT SUMMER!! I sure will be