Capacity Magazine December 2018 / January 2019 by Capacity Media

Capacity

VOL 19VOL ISSUE DECEMBER/JANUARY XX 1ISSUE XX MONTH 2014 2019

Big interview Marc Halbfinger, CEO, PCCW Global Special Report Capacity takes a look at the ever-changing subsea cable industry

Business intelligence for the global carrier industry

In the grip

of a new monster Capacity

capacitymedia.com

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| 01

CONTENTS Capacity magazine, December/January 2019

NEWS & ANALYSIS

VOL 19VOL ISSUE DECEMBER/JANUARY XX 1ISSUE XX MONTH 2014 2019

Big interview Marc Halbfinger, CEO, PCCW Global Special Report Capacity takes a look at the ever-changing subsea cable industry

04 ASIA & ASIA-PACIFIC

Business intelligence for the global carrier industry

09 NORTH AMERICA

Cover image: Adrian Teal, CartoonStock

In the grip

of a new monster

12 LATIN AMERICA

26 COMMERCIAL

BLOCKCHAIN MONTHS AWAY FROM ‘REAL LIFE’ APPLICATIONS IN WHOLESALE

Executive interview: Greg Twitt, Globalinx

Big interview: Michael Francois, Google Cloud

Saving subsea through diversity

Connecting the world

Stephanie Liston, Women in Telecoms and Technology

From the cable to the grave

80 THE INNOVATION

Big interview: Xiaohia Sun, PEACE Cable

A subsea cable industry in transition

76 CAPACITY MIDDLE EAST

14 MIDDLE EAST

- THE RACE FOR DIGITAL TRANSFORMATION

16 AFRICA

PEOPLE & DIARY

18 EUROPE 20 CAPACITY EUROPE ANALYSIS

capacitymedia.com

ON THE COVER

STRATEGIES

Capacity looks at what is driving the subsea cable industry and the impact of OTTs on the sector (page 39)

07 EXECUTIVE INTERVIEW Stephen Ho, CEO, CITIC Telecom

SUBSEA SPECIAL REPORT after page 39

78 APPOINTMENTS

The industry’s latest movers

79 A DAY IN THE LIFE

REPORT

OTT innovation

30 THE BIG INTERVIEWCapacity Ƥ ǡ ǡ PCCW Global

34 THE BIG INTERVIEW

Eric Cevis, SVP and group president, Verizon Partner Solutions

SECURITY SPECIAL REPORT after page 63

36 THE BIG INTERVIEW Bas Burger, CEO, BT Global Services

THE BIG INTERVIEW pages 30-31 Ƥ ǡ ǡ Global, discusses the move to inter-carrier collaboration and the integration of Console Connect

SPONSORS 48 ALCATEL SUBMARINE

FEATURES

NETWORKS

22 GLOBAL CARRIER

54 AQUA COMMS 58 SEA-ME-WE 5 70 DEUTSCHE TELEKOM

AWARDS WINNERS REVEALED

65 66

Security products

Big interview: Nicolas Arpagian, director of strategy, Orange Cyberdefense

Market trends

Tracking criminal minds

Partner with the UK’s largest Ethernet Network

Over 3,000 POPs enabled for 100MB and 1GB

Find out more talktalkbusiness.co.uk/carrier

Capacity

editor’s letter | 03

Happy Christmas and New Year from Capacity F

rom everyone here at Capacity, have a Merry Christmas and a Happy New Year! Enjoy the festivities and, if you are lucky enough to get some time off, enjoy it! This issue, which includes two special reports on subsea (pages 39-62) and security (pages 63-74), not only hits our global subscriber base but is also being distributed at Capacity Asia, Subsea Connect Americas, PTC, and also Metro Connect USA, so wherever you’re reading this from: Welcome to the December/January 2019 issue! The subsea market has seen some very exciting new systems coming into service and 2019 will see some key cables coming into play. Capacity maps out 12 stand-out cable projects that you should know about (pages 50-51). At the start of 2018, there were 448 cable systems operating around the world covering 1.2 million km, according to TeleGeography (pages 60-61), but a number of legacy cables are nearing their end. Network diversity is truly driving new cable system builds today, in particular from OTTs such as Google. We investigate how the market for subsea capacity is entering a new phase (pages 52-53). We also spoke to Michael Francois of Google Cloud about the increasing data demands that have led to Google’s Dunant cable project (pages 42-43). Other key big interviews featured within the magazine, include: PCCW Global’s Marc Halbfinger (pages 30-31), Verizon Partner Solutons’ Eric Cevis (pages 34-35), and BT Global Partner Services’ Bas Burger (pages 36-37). We take a look at how commercial blockchain is just months away from real-life applications in whiles (pages 26-27). Our security special report looks at how the carrier community is taking action to mitigate fraud and cyberattacks (pages 66-67) and highlights key findings (pages 73-74) from the GLF’s report into fraud, which costs the sector an estimated $17 billion annually. Capacity Since our last issue, we recognised the achievements of a number of companies at our Global Carrier Awards (congratulations again to all the winners!). You can see what you missed out on pages 22-23 and a list of all the winners on page 24. The year ahead will no doubt see the industry keeping pace with the surge of content and IoT will certainly push us, or even force us, to get even closer to the edge. Softwarisation is key here. Further investment in automation, SD-WAN, artificial intelligence, machine learning are all set to drive the digital economy further. That’s it from us though. Merry Christmas and see you in 2019!

Follow Capacity on Twitter: @capacitymedia

Jason McGee-Abe Editor-in-Chief, Capacity Media

Follow Capacity on Facebook: www.facebook.com/capacity-media Follow Capacity on YouTube: www.youtube.com/CapacitymagazineTV Follow Capacity on LinkedIn: www.linkedin.com/capacity-media

Management CEO Ros Irving ros.irving@capacitymedia.com

Sales International sales manager Federico Mancini federico.mancini@capacitymedia.com

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ITW event director Ross Webster ross.webster@capacitymedia.com

Design Freelance designer Paul Pancham

Accounts Administrative assistant Ruby Ward ruby.ward@capacitymedia.com

Editor-at-large Alan Burkitt-Gray alan.burkitt@capacitymedia.com Skype: alanbg Twitter: @alanburkittgray Deputy editor James Pearce james.pearce@capacitymedia.com Twitter: @jamespearce87 Reporter Natalie Bannerman natalie.bannerman@capacitymedia.com Twitter: @nitnat1989

Graphic designer Samantha Heasmer samantha.heasmer@capacitymedia.com

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Subscription enquiries Customer services customerservices@euromoneyplc.com tel +44 20 7779 8610 fax +44 20 7779 8602 Printer Stephens and George, UK Next issue December/January 2019 Published on 20 November 2018 Directors David Pritchard (Chairman), Andrew Rashbass (CEO), Andrew Ballingal, Tristan Hillgarth, Imogen Joss, Tim Collier, Kevin Beatty, Jan Babiak, Lorna Tilbian, Colin Day, Wendy Pallot Freelance writers Gareth Willmer Guy Matthews

How to contact Capacity Capacity magazine is published by Telcap, a division of Euromoney Global Limited TelCap, 8 Bouverie Street London EC4Y 8AX, UK tel +44 20 7779 7227 (switchboard) fax +44 20 7779 7228 www.capacitymedia.com Capacity (ISSN 1471-762X) is published six times a year by TelCap. Annual subscription €250, £210, $340. © TelCap, 2018. All rights reserved. No part of this publication may by reproduced, stored or introduced into any retrieval system, or transmitted in any form or by any means, electronic, manual, photocopying, recording or otherwise, without the prior written permission of the copyright owners Although TelCap has made every effort to ensure the accuracy of this publication, neither it nor any contributor can accept any legal responsibility whatsoever for consequences that may arise from errors or omissions or any opinions or advice given.

04 | asia and asia-pacific

CHINA TELECOM SET TO WIN THIRD PHILIPPINES MOBILE LICENCE

China Telecom: Partner in Mislatel consortium

hina Telecom is on a shortlist of one as the third mobile operator in the Philippines. The government is saying that the Mislatel consortium, in which China Telecom is a partner, will be given the licence to compete against PLDT and Globe Telecom.

Mislatel is an abbreviation for Mindanao Islamic Telephone, which already has a fixed licence. The other members of the consortium are Udenna, a holding company owned by businessman Dennis Uy, an associate of Rodrigo Duterte, president of the Philippines, and Udenna’s shipping business, Chelsea Logistics. According to reports from Manila, Mislatel says it will spend 40-140 billion pesos ($750 million to $2.6 billion) on investment in its first year of operation. It plans to cover 10-50% of the Philippines with speeds of 5-55Mbps. Mislatel said about the news: “The consortium is confident that Udenna Corporation’s extensive supply chain and knowledge of local industries will complement the world-class technology and telecommunications expertise of China Telecommunications Corporation, one of the world’s largest and most experienced fixed and mobile network operators. Meanwhile, Chelsea Capacity Logistic Corp’s expertise in logistics

and distribution will enable the speedy development of the network.” Duterte said a year ago that he wanted a third mobile operator – in a country of 105 million people – to compete with PLDT and Globe. After a meeting with China’s premier Li Keqiang in Manila in November 2017 he indicated he wanted a Chinese telecoms company to be part of the winning consortium. Only days ago 10 groups had bought the bid documents from the government, but several – including Norway’s Telenor and a group associated with South Korea’s KT – dropped out. Three groups were shortlisted, but then the National Telecommunications Commission (NTC) disqualified two of them for allegedly incorrect bids. The NTC said Sear Telecom had not submitted participation documents with its bid and that Philippine Telegraph and Telephone (PT&T) had not submitted a certificate of technical capacity. That left just the China Telecom/Mislatel/Udenna consortium in the running.

PCCW GLOBAL IN CHINESE SMART CITY PROJECT PCCW Global and the administration of Hengqin New District in China have agreed to explore telecoms and tech innovation. The agreement aims to benefit from the opening of the Hong Kong-ZhuhaiMacao Bridge and the Greater Bay Area development, and will foster a type of smart city project in the Guangdong, Hong Kong and Macao area. Under the terms of the agreement, the two will collaborate in the areas of Internet of Things (IoT), smart city and artificial intelligence (AI) development.

In addition, PCCW Global has created a wholly-owned subsidiary in Hengqin New District to build and operate a next-gen IoT smart city R&D services platform, an international IoT operation platform as well as AI training in GuangdongHong Kong-Macao Greater Bay Area plus demonstration and operation centres. Hengqin is 63km from Hong Kong and offers large trade and business potential. It covers an area of 106 square kilometres and is less than an hour’s travel from Hong Kong through the new bridge.

Smart city around Hong Kong-ZhuhaiMacao Bridge

NEWS IN BRIEF Telecoms fraud is estimated at $17 billion a year, according to the GLF’s latest report; Taking Action Against Fraud. (see page 73) The number of Rich Communication Services users is set to reach 1 billion in 2019, with the number rising to 3.2 billion by 2023. Global spend on cloud infrastructure is growing 45% a year, but hyperscale providers

Microsoft, Google and Alibaba are growing even faster. MEF has launched an Enterprise Advisory Council to offer end-user feedback on how carrier services can meet enterprise needs. Cloud data centre location directly impacts network latency, according to the findings of ThousandEyes’ 2018 Public Cloud Performance Benchmark report.

Mobile analytics company OpenSignal says that US mobile users on Verizon’s network had a video experience score of 50.57, with AT&T way behind with 40.88. Colt Technology Services has partnered with Zeetta Networks to launch a proof of concept demonstration of a blockchainbased carrier marketplace for LSO Sonata.

december/january 2019

asia and asia-pacific | 05

VEON AND HGC STRIKE GLOBAL BACKBONE AGREEMENT

Karsten Lereuth and Ravindran Mahalingam shake on the deal

Veon Wholesale Services has partnered with HGC Global Communications to jointly expand their combined wholesale activities geographically across Eurasia, North Africa, Asia-Pacific, and America. The partnership will see Veon Wholesale Services (VWS) and HGC use their combined international backbone infrastructure, which spans more than 140 countries, to boost coverage for their respective customer bases. The two companies said the deal will help add end-to-end VPN services to their portfolios, supporting corporate customers looking for low latency networks with committed SLAs.

The agreement will see the two wholesale firms use their backbone coverage bilaterally with highly reliable infrastructure and a standardised process. Capacity VWS general manager Karsten Lereuth said: “Veon Wholesale Services provides access to a unique footprint across Eurasia and North Africa. Thanks to our combined international PoPs and backbone coverage, VWS and HGC will provide targeted international services such as VPN, IP transit and even new promising solutions like regional CDNs, direct connections for/to OTTs.” He added: “This strategic collaboration with HGC is an integral part of our plan

to augment Veon Group’s international reach while building future proof networks and getting ready for next-generation customers through the development of new capabilities, platforms and products.” Veon’s footprint spans Eastern Europe, North America, Central and South Asia, with more than 100,000km of fibre infrastructure. It also has voice hubs, in Amsterdam and Frankfurt, and seven data hubs – Amsterdam, Frankfurt, Stockholm, London and Hong Kong. HGC is a leading Hong Kong and international fixed line operator, with extensive infrastructure in Hong Kong and overseas. Its network reach goes from Hong Kong to mainland China, Cambodia, Indonesia, Malaysia, the Philippines, Singapore, Japan, South Korea, Taiwan, Vietnam, Thailand, Myanmar, the UK and the US. Ravindran Mahalingam, SVP of international business at HGC Global Communications, said: “We are extending our collaboration from the enterprise market to wholesale services. Our extensive network infrastructure provides the powerful underlying foundation for softwarisation and digital services development, including SDN, blockchain, IoT, and other value-added services.” He continued: “Added to our stringent, best-in-class service level standards, flexibility in fulfilling customers’ needs, and dedication to tackling complex solutions, we believe that the collaboration allows us to provide more comprehensive end-toend solutions for our customers, under the dynamic market development.”

RESEARCH GROUP USES HAWAIKI TO SEND DETAILS OF NEW ZEALAND BRAINS TO US New Zealand’s scientific research network has started to use the new Hawaiki cable to transmit high-resolution brain scans to a US university. The network, REANNZ, is using Hawaiki, the subsea cable that went into operation in July, to transfer hundreds of encrypted MRI brain scans, comprising millions of data slices, to Duke University in the US for analysis. Hawaiki links New Zealand to Australia, the US and a number of Pacific islands. “This neuroimaging collaboration with Duke was made so much easier and seamless with REANNZ’s network and this new capability,” said Dr Sandhya Ramrakha of the University of Otago. “Our collaborators at Duke can check the data in real time.” capacitymedia.com

In September, Duke has made around 37 million file transfer operations during the daily data synchronisation processes. REANNZ has an anchor tenancy on the Hawaiki Cable on behalf of New Zealand’s research community, worth NZ$65 million ($43 million) over 25 years. This includes NZ$15 million contributed by government to support the second cable entrant to New Zealand. The Otago study is part of a 45-year-long project to follow the development of 1,000 people from birth. Nicole Ferguson, CEO of REANNZ, said: “We are proud that REANNZ members, including the University of Otago, are among the first to benefit from this high-speed connection on one of the

newest and most advanced submarine internet cables in the world.” Researchers in New Zealand “have direct connectivity across 15,000km to the US, which puts them on par with their global peers”, she said. “Using the Hawaiki Cable capacity, researchers have a stepping stone to over 2,000 universities and research institutes in America, and to a further 17,200 additional locations around the world.” Ferguson added: “We are geared to manage big, bursty, complex research traffic and move huge datasets – involving hundreds of gigabytes, terabytes and petabytes – between multiple people, in multiple institutions, in multiple places around the world.”

06 | asia and asia-pacific

5G CROSS-INVESTMENT TAKES DT AND SK TELECOM CLOSER TOGETHER Deutsche Telekom and South Korea’s SK Telecom have agreed to invest in each other’s start-ups as part of a developing partnership for 5G mobile. SK Telecom will invest in Californiabased MobiledgeX, an edge computing company founded by Deutsche Telekom. At the same time Deutsche Telekom plans to invest the same amount in ID Quantique (IDQ), a Geneva-based specialist in quantum cryptography communications technology. Deutsche Telekom CEO Tim Höttges said: “The partnership will help both companies to strengthen our global technology leadership and bring 5G and other innovative services to our customers.” Neither company said how much they are investing in each other’s start-ups, except that they are “equal amounts”. The deal is the latest move in what is becoming an increasingly close relationship between the two companies.

Collaborating on 5G: Deutsche Telekom’s Tim Höttges and SK Telecom’s Park Jung-ho

In 2016 the two founded Ngena, a cloud, internet of things (IoT) and 5G partnership, which has since been joined by a number of other carriers. The following year they set up the Quantum Alliance, to promote quantum computing, and in August 2017 SK Telecom CTO Choi Jin-sung (Alex Jin-sun

Choi) became CTO of Deutsche Telecom. Park Jung-ho, president and CEO of SK Telecom, said: “SK Telecom is pleased to enter into a cross-investment agreement with Deutsche Telekom as it will serve as a valuable opportunity for us to further solidify our 5G leadership in the global market and drive new growth.”

TELSTRA ‘INTERESTED IN BUYING Capacity NBN’ AND MERGING WITH INFRACO

Mullen may merge NBN with InfraCo

Telstra’s chair, John Mullen, has confirmed that the Australian company would like to buy the nation’s wholesale-

only National Broadband Network (NBN) from the government. If Telstra achieves the goal of buying out the NBN Co, which runs the wholesale-only NBN, it will merge it with its own newly created infrastructure division, InfraCo, Mullen hinted at the company’s AGM. “NBN Co pays Telstra about $1 billion a year for accessing all its ducts and the like,” he said. “If and when NBN Co is privatised we think there could be – only could be, no certainty – a lot of value uplift to Telstra shareholders if there was some form of combination of [InfraCo] with the NBN.” However Telstra would have to demerge InfraCo out into a separately owned unit

if it were to get such a deal through the competition authorities, he said. Telstra CEO Andy Penn announced the creation of InfraCo in June as part of his Telstra22 plan, which also included the company’s 5G strategy. InfraCo would have a separate CEO reporting to him, he said at the time. InfraCo would include Telstra Wholesale and the group’s fixed networks, including hybrid fibre-coaxial and fixednetwork fibre, data centres, international subsea cables, exchanges and ducts. Mullen said: “We are creating an InfraCo within Telstra so that when and if a government decides to privatise NBN, and they have a problem on their hands doing so, Telstra can potentially provide a solution.”

CHINA MOBILE, CHINA TELECOM, CHINA UNICOM IN €2BN NOKIA DEALS Nokia has entered into three different framework agreements with China Mobile, China Telecom and China Unicom, worth more than €2 billion. Under the terms of the agreements, Nokia will rollout technologies and services to improve the performance of fixed and mobile broadband networks across China, to meet the increasing demand as operators journey towards 5G. “We are excited to continue our close collaboration with these important customers in China, to drive new

levels of network performance as they transition toward 5G,” said Mike Wang, president of Nokia Shanghai Bell, its Chinese unit. “Leveraging the breadth of our endto-end network and services capabilities, we will work closely with China Mobile, China Telecom and China Unicom to deploy technologies that meet their specific business needs.” For China Mobile, Nokia will deploy technologies combined with expertise in radio access, core, passive optical

networks, IP routing and optical transport, SDN, network management and professional services. Nokia will support China Telecom to improve its 4G-LTE coverage and hotspot capacity. In addition, they will collaborate on 5G and help accelerate China’s 5G progress. As for China Unicom, Nokia will roll out its FDD-LTE radio access, multiaccess edge computing, virtualized IMS, SDN, IP routing and optical transport, and fixed network equipment. december/january 2019

executive interview: stephen ho | 07

CITIC TELECOM FOLLOWS THE OLD SILK ROAD FROM CHINA TO EUROPE Stephen Ho, CEO of Chinese company CITIC Telecom CPC, is expanding its cloud services following its takeover of a European carrier. Interview by Alan Burkitt-Gray

ITIC Telecom CPC’s 2017 acquisition of European operator Linx Telecommunication has enabled the Chinese company to expand its cloud services to Europe. “Cloud computing is a very important initiative to us,” says CEO Stephen Ho. “Most of our cloud computing sites are in Asia, but we are now in Frankfurt and London and we are building one in Moscow.” The company calls this project the Europe and Russia Cloud Ring. “Linx Telecom came on the market, with a network that was on the route of the old Silk Road, covering eastern Europe and a bit of Russia,” says Ho. “It was an opportune time for us to expand our reach into Europe.” This also fits neatly with China’s Digital Silk Road policy, also known as

since the start of 2001, and he is a recognised international figure in the industry. In January 2018 he was elected for the third time as president and chair of the board of Pacific Telecommunications Council (PTC) at its annual meeting in Hawaii. Sharon Nakama, the PTC’s CEO, said that he “has been unfailingly supportive of PTC’s vision, mandate and actions”. He’s also extremely well connected in Capacity Hong Kong, where CITIC Telecom has its international base. He’s on the board of directors of the Hong Kong Applied Science and Technology Research Institute (ASTRI). “We’re very active in blockchain and 5G,” he says of the institute. “We have 500 PhDs – most of our staff are PhDs.” We turn back to CITIC Telecom’s

Linx Telecom came on the market, with a network that was on the route of the old Silk Road. It was an opportune time for us to expand our reach into Europe” Stephen Ho, CEO, CITIC Telecom CPC

One Belt, One Road, by which it is building links through to central Asia and Europe. CITIC Telecom CPC is controlled by state-controlled CITIC, formerly the China International Trust Investment Corporation. Its strategy is to build global links – initially for Chinese companies but increasingly for world companies wanting access to China – along this new Silk Road. “We’re not very heavy into infrastructure per se. We’re asset-light,” says Ho. “China Telecom, China Unicom and China Mobile are Tier-1 operators and we buy from them. Sometimes we cooperate and sometimes we compete.” Ho has been CEO of CITIC Telecom capacitymedia.com

strategy. What would have happened if the company hadn’t come across Linx Telecom. “We would have built the network ourselves,” he says. “It would have taken time and a little bit of pain.” But a bank approached Ho, acting as an intermediary for Linx’s owners. “It was an extension of what we were doing already.” The company has evolved since Ho has been CEO. “We have been in cybersecurity since 2006,” he says. “But willingness to spend money on cybersecurity was low in those days. Now it catches a lot of people’s attention – and not just in the finance department. In Hong Kong, the monetary authorities are adamant that institutions have a security

officer – and in China too. We were very lucky because we had the product already.” It’s a similar story with CITIC’s cloud services, “which we’ve been doing since 2011”. Some of the company’s customers are using other cloud platforms, he adds, “but using our network. If customers want to use our platform, it becomes part of the network. In the not too distant future, the network becomes part of the platform.” Ho admits that the Linx network is still not fully integrated into CITIC Telecom. “We’re doing the integration, but we don’t want to do it at a very high pace. We have to learn the market ourselves,” he says. “A lot of Chinese companies are moving into Europe and we want to serve them. We want to understand more of the market. We don’t want to rush into something we don’t know. And we don’t want to jeopardise service quality.” Integration is a challenge, he admits. “The IT systems have to be integrated and you have to take tough decisions. We’re migrating a lot of CITIC expertise into Linx.” One of the biggest challenges is the billing side: Linx had a series of local billing engines. But following the takeover there is an increasing amount of cross-selling – Asian customers that want to get to Europe and vice versa. “A Singapore customer already uses us across Asia and now is talking about expanding its services to Europe,” says Ho, with local support and bills in euro. “We have a number of these in the pipeline in Asia. Now the company has a global capability.” Other challenges, he adds, is getting the right people – not just in Europe but also in Asia. “China is a big place and we’re looking for people who are very service-oriented. It’s very hard to get people with the talent, and people who can work in different locations around the world – that’s a challenge.”

Capacity

north america | 09

VERIZON SEEKING MORE PARTNERS FOR INTEROPERABILITY TRIALS arlier this year, Verizon showcased its two-way inter carrier SDN network orchestration in partnership with Colt Technology Services, but now the US telco is eying other partners for further trials. The original trial showcased how Colt and Verizon could make near real-time bandwidth changes in each other’s’ production networks. In an exclusive interview with Capacity, Verizon’s Eric Cevis said the company is opening this up to other carriers. “We’re in conversations about how we try to expand and develop more

carrier interoperability,” Cevis said in the interview, which can be found on page 34. “A lot of discussion is around continuing the evolution of our network and our products. We will continue to drive standards and maintain a leadership role across our fibre assets. I’m looking forward to where this takes us, especially when you’re looking at the 5G rollout.” The aim, added Cevis, is to have multiple software-defined network testbeds going forward. Core to this is developing new partnerships so that there is scope to grow interoperability in the industry.

CABLE ONE TO ACQUIRE CLEARWAVE COMMUNICATIONS

ZAYO GROUP TO SPLIT INTO TWO PUBLIC COMPANIES IN 2019

Julie Laulis: Clearwave acquisition to boost Cable ONE footprint

Cable ONE has entered into a definitive agreement to acquire Clearwave Communications, a facilities-based service provider in Illinois. Once completed, the deal will give Cable ONE leading fibre within its existing footprint and further enables the company to provide its customers with enhanced business services solutions. “We are excited to partner with the Clearwave team, who have built a highly successful business services platform in nonurban markets with similar characteristics to ours,” said Julie Laulis, president and CEO of Cable ONE. In addition, the deal will give Cable ONE the ability to copy Clearwave’s strategy in several of the company’s existing markets. At present Clearwave has more than 2,400 route miles of dense metro fibre infrastructure connecting close to 2,700 onnet businesses, towers and data centres. The all-cash deal is expected to close in the first quarter of 2019 and is subject to certain regulatory approvals as well as other customary closing conditions. capacitymedia.com

Zayo Group has announced its plans to separate into two publicly traded companies, Zayo Infrastructure and EnterpriseCo, which is expected to complete in late 2019. Capacity “Today’s announcement is the logical next step in the evolution of Zayo,” said Dan Caruso, chairman and CEO of Zayo. “While Zayo’s business today is organized as five autonomous segments, the complexities of these businesses have made it more difficult to achieve our growth objectives.” InfraCo will focus on providing core communications infrastructure and EnterpriseCo will use infrastructure to provide solutions for a broad set of enterprise customers. Zayo Infrastructure (InfraCo) will be a, fibre-focused communications infrastructure provider with deep, dense networks and broad geographic reach throughout North America and Western Europe. While EnterpriseCo will have a strong product portfolio and customer base centered on higher bandwidth

Cevis added: “Some of that is through partnerships – we partnered with the likes of Colt, and we’re talking to NTT right now about whether we can carry out an interoperability software-defined conversation we need to have, so we have more than one SDN testbed going forward. “The work we’ve been doing with the likes of MEF and TM Forum is important. With that, we’re not doing anything that is proprietary – we’re building on an open source basis that allows us to scale more easily.”

Zayo is evolving, says Dan Caruso

connectivity to enterprise locations, including to public cloud and SaaS providers that will be sold directly to both enterprise customers and wholesale through a carrier-focused channel. “By completely separating the infrastructure and enterprise businesses, we will enable more focused execution within each business, leading to enhanced growth and unlocking value,” added Caruso.

LEOSAT SET TO LAUNCH MPLS NETWORK IN SPACE AFTER FCC APPROVAL The Federal Communications Commission (FCC) has approved LeoSat’s new low earth orbit satellite constellation, which will provide the first backbone in space specifically designed for global business. LeoSat Enterprises is launching a data network that is made up of a constellation of up to 108 low-earth-orbit communications satellites to provide a MPLS network in space. The company says the optical

backbone in space will be 1.5 times faster than terrestrial fibre, will have extremely-low latency and will be an ultra-secure network. “Getting approval from the FCC – among the world’s most sophisticated radio frequency regulators – is an important milestone for LeoSat and recognises that we have a unique solution for high-speed and ultra-secure enterprise connectivity,” said Mark Rigolle, CEO of LeoSat.

Capacity

12 | latin america

HC2 TO ACQUIRE GO2TEL

C2 Holdings, a diversified holdings company, is set to acquire Go2Tel, a VoIP carrier with operations in Latin America, South America and the Caribbean. The news comes as HC2 recently rebranded its telecom subsidiary PTGiICS from Arbinet Corporation to ICS Group Holdings. Since the name change, the firm said that its target acquisitions will be small to medium opportunities in the global IT space. “Go2Tel is the first acquisition by ICS Group as we embark on the pursuit of attractive M&A opportunities,” said Craig Denson, president and CEO of ICS Group Holdings. “This transaction is a natural complement to our ownership of PTGi-ICS, and will help us continue to

pay dividends up to our parent company.” The undisclosed transaction will add teams across Colombia, Bolivia and Spain under the HC2 umbrella and aligns itself with the company’s mission to “seek out and purchase companies that have a proven track record, a strong balance sheet and low capital expenditures,” the company said in a statement. “ICS Group will be an efficient new vehicle for HC2 to generate value for its shareholders in the global communication and IT marketplace,” added Philip Falcone, HC2’s chairman, president and chief executive officer. “ICS Group’s first acquisition under its new name and mandate, Go2Tel, will support continued dividend contributions back to HC2.”

NEUTRONA NETWORKS COMPLETES 100G NETWORK UPGRADE

Neutrona to “shift its energies”, says Ward

Neutrona Networks has completed a major phase in its network development with the completion of a number of network upgrades. The Latin American carrier has expanded its network Brazil, adding numerous new terrestrial, subsea fibre routes, and the

opening of a new international gateway point of presence in Equinix’s SP2 data Capacity centre in São Paulo, as well as other neutral data centres in the country. “Over the last three years, we have been simultaneously providing the world’s largest carriers access into the ‘red hot’ Latin American market while upgrading and modernising our network to support our future growth,” said Mateo Ward, cofounder of Neutrona Networks. “We have now reached a phase where we can shift our energies to take full advantage of these multi-year investments and concentrate upon the operational advantages our network provides to ensure a superior customer experience.” In addition, the company has recently secured new indefeasible right of use (IRU) agreements to boost network bandwidth capacity by 100Gbps and add new subsea cable access points on multiple systems.

TELEFÓNICA PLANS TO USE BLOCKCHAIN FOR INTERNATIONAL CALL ROUTING

Gonzalo Martín-Villa: Telefónica to use blockchain to help monitor fraud

Telefónica has announced it is working with IBM in a blockchain-based and cloud-based project to improve the routing of international calls. The company wants to track in real time each international call, including origin, destination and duration, and make that information available to all the operators carrying the call. Gonzalo Martín-Villa, chief innovation officer of Telefónica, said: “Blockchain will allow operators to generate a new layer of confidence in the internet – based not on the players that generate the data and the transactions but on the data itself.” “This project is one of our first initiatives to secure real benefits from the adoption of blockchain in our core business. We believe that the new paradigm of process decentralisation that blockchain facilitates perfectly fits with the telecommunications industry and can help us to significantly improve the way we have been traditionally solving the integrations between partners,” said Martín-Villa. The company will use IBM’s own blockchain platform running in IBM’s cloud to improve “the reliability and transparency of information collected by different networks when routing international calls”.

ANATEL PUBLISHES NEW REFERENCE PRICES FOR TELECOMS MARKET Anatel, the Brazilian telecommunications agency, has approved the reference prices for wholesale telecoms services, specifically voice roaming, data roaming and SMS roaming, pipeline rental, bit stream, full unbundling and wholesale transport. The agency says that by establishing these benchmark prices small providers will benefit as they can negotiate with larger firms with more transparency. It marks the first time that Anatel has published such information

and will reassess these figures every two years. Leonardo de Morais, president of Anatel, stressed that the reference figures seek to promote competition and stimulate further investment, as well as to support the decision to implement a new General Competition Goals Plan (PGMC), that was approved in July of this year. Additionally, Aníbal Diniz, an Anatel advisor said that the decision to publish the prices is key to boosting fixed

broadband in the market. “It will now be possible to actually create a high capacity transportation market in the Wholesale Deal Trading System (SNOA)”, said Diniz. According to the definition of the reference values, providers that hold a large market share or Significant Market Power (SMP), must present their price offerings and once approval by Anatel, will be traded in the SNOA. december/january 2019

Capacity

14 | middle east

GBI AND VODAFONE QATAR SIGN NEW INTERNATIONAL CONNECTIVITY AGREEMENT

GBI deal will offer Vodafone Qatar customers secure connectivity

ulf Bridge International (GBI) has signed a new long-term agreement with Vodafone Qatar that will provide the telco with IP transit service, international SDH and global Ethernet from Qatar to Europe and Asia. This agreement enhances the exiting strategic business alliance between

the two companies. The latter has the ability to grow further with the increase in consumer and enterprise demand, capitalising on GBI’s strategic connectivity corridors. This agreement is set to enhance the strategic business alliance between the two companies. “We are excited to be extending our

Capacity ZAIN BAHRAIN JOINS 2.3TBPS MEETS CABLE SYSTEM TO BOOST ENTERPRISE OFFERING

Mohammed Zainalabedin: Major hub

Zain Bahrain has joined the Middle East – Europe Terrestrial System (MEETS), an international cable system that provides state-of-the-art high bandwidth regional connectivity solutions. By joining MEETS, Zain Bahrain will offer enhanced products to meet the increasing demand for high-speed and reliable connectivity throughout the kingdom of Bahrain, particularly among the booming enterprise sector. The company has hailed it as “a major regional telecommunication development for the kingdom of Bahrain” as it drives towards making the kingdom a major hub for ICT and data movement in the MENA region. “The introduction of MEETS supports the kingdom of Bahrain’s vision towards positioning Bahrain as a major hub for

ICT and data movement in the MENA region,” said Mohammed Zainalabedin, general manager of Zain Bahrain. “It also supports Zain Bahrain’s strategic plans to develop a world-class infrastructure locally and globally to cater for the growing demand of high-speed and low-latency connectivity solutions for our enterprise customers in Bahrain. Providing a superior internet experience will help Zain Bahrain retain and attract new customers, while complementing our cutting-edge mobile data expansion strategy and supporting the roll-out of dynamic enterprise services to our corporate clients.” MEETS is a partnership between a GCC-wide telecoms consortium, both conceived and co-promoted jointly by Zain, the MEETS landing party in Bahrain, with du, Vodafone and Zajil, with the aim to significantly improve regional connectivity. It offers connectivity in the GCC region with a design capacity in excess of 2.3Tbps. MEETS is built on an optical ground wire over a 1,400km regional high-tension electricity network, reducing the risk of cable cuts and enhancing the availability normally associated with submarine cables. The MEETS system is a state-ofthe-art, upgradeable optical transport network capable of sustaining the growing bandwidth demand in the region.

partnership with Vodafone Qatar and working closely together on delivering value to our customers,” said Abdulla Al Ruwali (pictured on the right), executive director and managing director of GBI. “As demonstrated by this agreement, we are looking forward to building sustainable, long-term partnerships with global leaders, with the ultimate goal of bringing the experience to our partners and end-users with the unique GBI network spread.” The GBI solution will offer Vodafone Qatar’s consumers and businesses secure connectivity that will serve Vodafone Qatar’s high internet and data demand locally and globally. The GBI network enhances reliability and business continuity and the North route guarantees access to European content. This is all supported by GBI’s 24/7 network operation centre.

ORIXCOM PARTNERS MEGAPORT FOR DIRECT CLOUD CONNECTIVITY IN DUBAI Megaport and Orixcom have partnered to enable enterprises and carriers in the Middle East with direct access to managed service providers (MSPs) and cloud service providers (CSPs). “With cloud service providers making greater investments in the UAE and Middle East, it’s important enterprises have a scalable and easy way to get directly connected,” said Vincent English, CEO of Megaport. “We are excited to partner with Orixcom to extend the reach of cloud services and satisfy the growing demand for cloud connectivity in the Middle East. Using Megaport’s global SDN, Orixcom customers are able to directly access cloud service providers such as AWS, Google Cloud, IBM Cloud, Oracle, Alibaba Cloud, and Salesforce. Customers can “right size” connections to ensure scale of services and also optimise costs. Megaport Cloud Router (MCR) delivers virtual routing capabilities to give greater control and enables use-cases like cloud-to-cloud and virtual PoPs. “Cloud is transforming the world of enterprise IT, and we need to transform the world of enterprise connectivity,” said Andrew Grenville, CEO of Orixcom. “By partnering with Megaport Orixcom continues to drive change to deliver more value in the Middle East region with connectivity choices.” december/january 2019

Capacity

16 | africa

OPIC GIVES $100M BACKING TO AFRICELL TO BOOST CONNECT AFRICA INITIATIVE

Ziad Dalloul: Growth programmes

he Overseas Private Investment Corporation (OPIC), the US government’s development finance institution, and Africell have signed a

commitment letter for $100 million to expand access to telecommunications in Africa. The project is expected to have a highly developmental impact, particularly in Uganda and the Democratic Republic of the Congo, by expanding the availability and quality of affordable mobile telephone and internet services in these countries. “Africell‘s success to putting communities at the heart and soul of the company’s strategy and to management’s focus on operational efficiency to create value for its customers,” said Africell’s founding CEO and group chairman, Ziad Dalloul. “It is important to partner with investors who truly understand our business model, as well as our markets, to structure solutions that support our growth programmes.” Telecommunications is a critical part of development in emerging markets and this

project seeks to promote better access to and higher usage of both mobile voice and broadband technologies in its markets by offering high-quality service at affordable rates. “Telecommunications is now essential to a country’s economic development and competitiveness,” added OPIC president and CEO, Ray W Washburne. “OPIC’s partnership with Africell highlights our goal of improving communication infrastructure across the continent by supporting our Connect Africa initiative. Better connectivity will remove barriers that restrict growth and commerce.” Earlier this summer, OPIC launched Connect Africa, an initiative aimed at improving connectivity in Africa by investing $1 billion in physical infrastructure, technology, and value chains.

MDXI AND ASTEROID LAUNCH WEST AFRICAN IXP IN LAGOS Capacity West African data centre provider, MDXI, and Asteroid, a global IXP platform provider, have collaborated to launch a carrier-neutral internet exchange point (IXP) in the region. The new offering, the West African Internet Exchange (WAF-IX), is built on Asteroid’s lightweight design and will be located in MDXI’s Tier III data centre in Lagos, Nigeria, the biggest economic hub in the region. “West Africa’s digital economy is on the rise, but huge gaps still exist in incountry interconnection,” said Remco van Mook, CEO of Asteroid. “We believe that the internet sector across West

Africa has incredible potential for growth and will be greatly enabled by the West African Internet Exchange. Together, we can provide a gateway for West African networks to peer with international content providers.” WAF-IX has three main objectives: accessibility, lower costs and reduced latency for internet users in West Africa. In addition, the WAF-IX will help to facilitate improved interconnection, collaboration and peering between various players with access to MDXI’s data centre. “Given the size of its markets and status as home to some of Africa’s biggest economies, West Africa is

uniquely positioned to scale up its digital transformation efforts via Internet traffic growth, says Vremudia Oghene-Ruemu, product manager of MDXI and peering coordinator at WAF-IX. “The West African Internet Exchange, hosted within our globally certified data centre, will significantly improve traffic exchange and localisation within West Africa, with benefits of reduced latency, improved speed and better quality of service to end users. WAF-IX will enable more Africafocused global and local carriers take advantage of the region’s growing internet penetration to enable services originating and terminating within the region.”

SEACOM TO ACQUIRE SAI IN SOUTH AFRICA TO BOOST BUSINESS SERVICES SEACOM has completed its acquisition of the SME-focused internet service provider, SAI, in KwaZulu-Natal, South Africa. The news comes in line with the company’s SEACOM Business, which launched in 2015 to serve Africa’s data use business customers. The new acquisition supports SEACOM’s plans to deliver the best possible connectivity and cloud services to business customers along the South African east coast. “This acquisition allows us to leverage SAI’s expertise, reputation and local market knowledge, effectively speeding up our regional growth plans in KwaZulu-

Clatterbuck: SAI acquisition speeds up SEACOM’s regional growth plans

Natal,” said Byron Clatterbuck, CEO of SEACOM. SAI will be rebranded as the SEACOM KwaZulu-Natal office and will be tasked with leading SEACOM’s expansion in the KwaZulu-Natal market for fibre internet access to business-customer premises. “SAI customers and staff will benefit significantly from the resources SEACOM has to offer,” said Des Ramsay, managing director at SAI. “With a connection directly into the heart of the African internet, user experience will be unsurpassed and SEACOM’s presence in KZN accelerated.” december/january 2019

africa | 17

AVANTI SIGNS TWO AFRICAN DEALS FOR HYLAS 4 SATELLITE

Philippe Tintignac: Avanti ‘real success’

The Avanti satellite group has signed a pair of wholesale agreements with African telecoms companies. One will allow Afrique Telecom to provide high-speed satellite broadband services across Sub-Saharan Africa. Philippe Tintignac, CEO of Afrique Telecom, said: “We are committed to

connecting businesses across Sub-Saharan Africa with high-speed broadband. Avanti’s Hylas 4 enables us to provide customers with high speed and quality broadband flexible Ka-band satellite technology for consumer rural broadband and enterprise services. Our first live site with Hylas 4 has been a real success and we’re excited to help the digital transformation in Africa.” The other extends an existing strategic partnership with Paratus Telecom. Maxwell Technology, part of the Paratus Group, has been using Avanti’s Hylas 2 services since 2012. Through Avanti’s latest satellite, Hylas 4, Paratus will provide cost-effective and reliable broadband services into regions across Africa that suffer from unreliable or non-existent internet connectivity. “With Hylas 4 we are further extending our reach and ability to provide high throughput connectivity throughout Southern Africa,” added Kallie Carlsen, MD of Paratus South Africa.

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FRANCE-IX STRENGTHENS ITS PRESENCE IN AFRICA France-IX has reached a number of milestones in Africa including increasing the number of African networks in Paris and Marseille by 60% while traffic from African ISPs has increased by 90%. “France-IX both contributes to and benefits from internet bandwidth growth in Africa: 14% of our Marseille peers are African ISPs and we aim to support the expansion of Internet connectivity across Africa by offering affordable, reliable, low-latency Internet peering services from France,” said Delphine Masciopinto, CCO at France-IX. Six African networks have connected to France-IX in the last year, bringing the total number to 16. The new networks are Dolphin Telecom in Ghana, Nigeria and Senegal; Ecoband in Ghana; Guilab in Guinea; Orange Senegal; Parabole Reunion in Reunion, Mauritius, Madagascar, Mayotte and Comores; and Liquid Telecom in Botswana, DRC, Kenya, Lesotho, Mauritius, Rwanda, South Africa, Tanzania, Uganda, Zambia and Zimbabwe.

18 | europe

‘NO NEW CUSTOMERS’ AS BT SCALES BACK GLOBAL WHOLESALE VOICE

Staples: leaves as BT Global Services scales back global wholesale voice

T Global Services is cutting back on its global wholesale voice business and is planning to sell its 52 data centres. The division is not closing down its wholesale voice business, Bas Burger, CEO of BT Global Services, told Capacity, but it has assigned the business to its “legacy” category and will not be looking for new customers. Following the decision, Damien Staples has left the company, where he was London-based VP of wholesale voice and roaming. His portfolio has moved to Dallas-based Dave Disley, COO of BT in the Americas, working for Jennifer Artley, president of BT in the Americas. Staples did represent BT at the Capacity Europe conference at the end of October, having told a number of people in the

industry of his likely departure following what he called “a fairly substantial change in the Global Services structure”. Burger told Capacity – see interview, pages 36-37 – that BT Global Services is “aiming to become a much more lean and fit, future-focused organisation”, that will focus on three growth areas plus mature markets such as MPLS. “Voice, including voice conferencing, sits in the old technology category,” he said. The group’s data centres have been also marked for disposal or closure. “We are not a data centre company. Some are very small and easy to wind down.” BT will “move people out and close” its data centres as it shifts services to its preferred cloud partners, Microsoft Azure and Amazon Web Services.

TELEFÓNICA ‘LOOKING AT SELLING DATA CENTRES’ IN PLAN TO REDUCE €42BN DEBT, SAYS REPORT Telefónica is not responding to reports that it is looking at selling its data centre operation in an attempt to reduce its €42.6 billion debt. The Bloomberg news agency has reported that Telefónica has appointed financial advisers to identify potential interested parties. The agency reports that the company could raise $500 million to $1 billion (€435-€870 million), depending on the extent of the sale. The news comes

Capacity four months after the group raised €379 million by selling an almost 10% share in Telxius, its towers and subsea subsidiary, to a real-estate company. That deal valued the whole of Telxius at about €3.7 billion. In 2016 Telefónica called off a plan for a public share sale in Telxius that would have raised a target €1.2 billion, but in 2017 it did sell a 40% stake in the unit to private equity investor KKR for about €1.2 billion. It has still not floated shares

in its UK operation, O2, despite plans to do so in 2017. Meanwhile, Telefónica reported has managed to reduce its debt by 10% year on year, though revenues for the third quarter of 2018 were down 8.3% on the same period of 2017. Profits, however, were 35.8% up for the quarter, to €1.14 billion. Bloomberg cited unidentified “people with knowledge of the matter” saying that Telefónica’s strategic review is “in early stages”.

RETN ACTIVATES NEW FIBRE-OPTIC ROUTE FROM MOSCOW TO RIGA International network service provider RETN has announced the launch of new high-speed fibre-optic route between Moscow and Riga. This recent infrastructure expansion provides diversity of current fibre routes across the RETN network and opens up new connectivity possibilities between East and West with low latency, of 12ms, transport services for enterprise and wholesale customers. “We are constantly investing in the physical network infrastructure to extend our network core in Europe and Russia as we see the growing demand for diversity of fibre routes,” said Maxim Syunikov, managing director at RETN in Russia on the project. “This is especially relevant when it comes global enterprises and content

providers. They are hungry for high speed scalable solutions, which we are delighted to bring to them, either in Russia or in many other territories covered by the RETN network.” The completed DWDM route connecting Russia and Latvia runs on Infinera’s FlexILS equipment and thus is seamlessly integrated into the extensive cross-border optical network, which is fully owned and operated by RETN. Connecting Eastern Europe and Russia to the West, the 1,195km route is 100G enabled. It also provides additional redundancy to the Scandinavian and Baltic rings linking Baltic states to Northern and Western Europe on the RETN network. Leonid Shuralev, commercial director at RETN Baltic, added: “This year we significantly increased our operational

New high-speed route links Riga, Latvia, with Moscow, Russia

activity in the Baltic and Scandinavian markets due to acquisition of OPTRON SIA and opening of the new RETN office in Stockholm. With the launch of the Moscow-Riga DWDM route we are delighted to start offering our customers more opportunities to connect to and from these regions”. december/january 2019

Capacity

20 | analysis: capacity europe

TOP WHOLESALE EXECS SAY COLLABORATION WILL DRIVE THE FUTURE OF THE WHOLESALE INDUSTRY INNOVATION WAS THE KEY TOPIC IN THE SECOND BIG CARRIER DEBATE, WHICH TOOK PLACE AT CAPACITY EUROPE IN OCTOBER 2018

Capacity

ore collaboration across the wholesale industry will play a key role in international carriers creating innovative new solutions to meet the growing demand for data. That was the viewpoint expressed by a number of industry leaders who took part in Capacity’s Big Carrier Debate (the Sequel) at Capacity Europe, held in London at the end of October. The panel, which featured high level speakers from Telefónica, Orange International Carriers, PCCW Global, Verizon and Deutsche Telekom Global Carrier, which relaunched earlier this week, as exclusively revealed by Capacity. As a follow-up to last year’s successful Big Carrier Debate, this panel looked at innovation within the carrier industry, with moderator Erik Kneiferdt, of TeleGeography, asking each speaker how their companies are leading in innovation. Eric Cevis, of Verizon, pointed to the US telco’s leadership in 5G communications – the fifth generation of mobile technology. According to Cevis, collaboration across the industry will be key to the success of

5G. He said: “We look forward for 5G which goes beyond an evolution into revolution in terms of how we work with other carriers to bring about this technology. It will need more partnerships and more collaboration.” 5G was also a key consideration for Orange International Carriers, according to Pierre-Louis de Guillebon, who also sat on the panel. He said that, to tackle both 5G and the internet of things, Orange is “pushing fibre into all of our networks to support our end users.” Marc Halbfinger, CEO at PCCW Global, pointed to his company’s acquisition of Console Connect, announced at the end of 2017. The acquisition of the platform gave it more of an ability to “deliver on-demand services” for its customer base. He explained: “Transformation at PCCW Global has been centred around our acquisition of Console Connect, and the ability to deliver on-demand services. The more we as service providers automat eboth the backend and frontend for interoperability, the more we can offer on-demand services. We believe that automation on demand and communities,

through innovation channels evolving worldwide, will help drive innovation in the carrier community.” For interoperability across several carriers to work, there needs to be “standards based architecture. LSO means we can scale more quickly across the countries represented here, and these discussions need to be had in the MEF forums and the TM Forum’s as well.” Halbfinger also pointed to the work of the Global Leaders’ Forum, which he chairs, in driving collaboration across the international carrier community. He explained: “If we take the legacy bilateral constructs then we may forget about carriers alone. It may require a completely new commercial framework to replace bilateral roaming, and it may require carriers to sit down and work out the backend together, getting rid of that traditional model. “Historically carriers have a willingness to inter-operate and create traffic with one another, outside of an ecosystem centric to themselves. Arguably our openness slows us down, but if we can find the road map to deal with that oxymoron, we may be in good shape.” december/january 2019

Capacity

22 | global carrier awards 2018

Awards 2018

GLOBAL CARRIER AWARDS WINNERS REVEALED

he 14th Global Carrier Awards saw top executives from across the international carrier community descend on the Troxy Theatre in London to celebrate the industryâ&#x20AC;&#x2122;s achievements from the past year. World record-breaking polar explorer Ben Saunders was the guest speaker at the 2018 GCAs. Saunders is one of the worldâ&#x20AC;&#x2122;s leading polar explorers, and a record-breaking long-distance skier who has covered more than 6,000km (3,700 miles) on foot in the polar regions since 2001. His accomplishments include leading

the Scott Expedition, the longest human-powered polar journey in history, and the first completion of the expedition that defeated Captain Scott and Sir Ernest Shackleton. It was a 105-day round-trip from Ross Island on the coast of Antarctica to the South Pole and back again. The awards were handed out by Capacity Media CEO Rosalind Irving and Capacity editor-in-chief and head judge for the GCAs Jason McGee-Abe. See a full list of winners on page 24.

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december/january 2019

global carrier awards 2018 | 23

Capacity

capacitymedia.com

24 2 4 | global global carrier carrier aawards wards 2018 2018

Awards 2018

24 October | Troxy Theatre, London

GLOBAL WHOLESALE

BEST DATA CENTRE & INTERNET EXCHANGE

INNOVATION

Best Global Wholesale Carrier – VOICE Orange International Carriers

Best Data Centre Iron Mountain

Wholesale Innovation Disruptor of the Year Neutrona Networks

Best Global Wholesale Carrier – DATA Deutsche Telekom Global Carrier

Best Data Centre Innovation Rack Centre

Best Voice Service Innovation – Emerging Market PCCW Global

REGIONAL WHOLESALE Best Pan-European Wholesale Carrier Deutsche Telekom Global Carrier Best Eastern European / CIS Wholesale Carrier OTEGLOBE

Best Internet Exchange NetIX Communications Best Internet Exchange Innovation DE-CIX

Best Voice Service Innovation – Mature Market Colt Technology Services Best Data Service Innovation – Emerging Market Neutrona Networks

BEST PROJECT

Best African Wholesale Carrier Liquid Telecom

Project of the Year – Terrestrial Newroz Telecom

Best Data Service Innovation – Mature Market Virtual1

Best Middle Eastern Wholesale Carrier Etisalat

Project of the Year – Subsea Hawaiki Submarine Cable

Best Network Technology Innovation Ciena

Best Asian Wholesale Carrier Global Cloud Xchange

Best European Project Deutsche Telekom Global Carrier

Best SMS Innovation Voxbone

Best North American Wholesale Carrier NTT Communications Best Latin American Wholesale Carrier Telefónica Best Caribbean Wholesale Carrier C&W Networks BEST MARKETING / SALES TEAMS Best Marketing Team Colt Technology Services

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Best African Project Airtel Business Best Middle Eastern Project Omantel Best Asian Project Tele2 Kazakhstan Best North American Project NJFX Best Latin American Project Gold Data

Best Marketing Campaign C&W Networks

Best Anti-Fraud Innovation Orange International Carriers Best Subsea Innovation PCCW Global Best Cloud Innovation The Sphere Best Uniﬁed Communications Innovation Dialogic Best OTT Partnership A1 Telekom Austria Best Enterprise Partnership Neutrona Networks

SPECIAL RECOGNITION Best Social Media Campaign GlobeNet Best Marketing Campaign around Industry Events IXcellerate Best Wholesale Sales Team Verizon Partner Solutions

Best Customer Testimony Epsilon

BEST TECHNOLOGY IMPLEMENTATION / DEPLOYMENT

Best Strategic Acquisition Tofane Global

Best SDN/NFV Deployment Epsilon

Best CSR Initiative HGC Global Communications

Best OSS/BSS Deployment Neutrona Networks

december/january 2019

Success is best when itâ&#x20AC;&#x2DC;s shared. We are proud to be the winner of the global carrier award 2018 for the best OTT partnership.

Capacity

A1 Telekom Austria Group Wholesale is an established telecommunications provider in CEE with more than 24 million retail customers across our markets of operations. Our portfolio covers a wide variety of innovative solutions including data, voice, mobile, roaming and satellite solutions.

Winner

Best OTT Partnership

A1.group/wholesale

A1 Telekom Austria

26 |

Commercial

Blockchain â&#x20AC;&#x2DC;months awayâ&#x20AC;&#x2122; from

real-life applications in wholesale Capacity

AFTER MONTHS OF TRIALS, BLOCKCHAIN WILL BE USED COMMERCIALLY IN THE INDUSTRY IN 2019 IN A $13BN MARKET, LEADERS TELL Ç§ . MEANWHILE Ç§ Ç§

ompanies in the industry could be using blockchain technology to process wholesale voice settlements in 2019, according to a number of senior executives in a position to know. Their determination follows successful proofs of concept by the wholesale units of six leading carriers â&#x20AC;&#x201C; Colt and PCCW Global at first, later joined by BT, Orange, TelefĂłnica and Telstra. The executive chairman of Clear Blockchain Technologies, the company providing the back-end for the settlements, agrees. â&#x20AC;&#x153;We want to launch a production network at the end of the first quarter of 2019,â&#x20AC;? Eran Haggiag told me. â&#x20AC;&#x153;Thatâ&#x20AC;&#x2122;s assuming very strong collaboration with the telcos â&#x20AC;&#x201C; and that would be the fastest date to a production network.â&#x20AC;? At our Capacity Europe event in London in October 2018 executives appeared confident that the blockchain system would be in commercial operation for transactions by the end of 2019. â&#x20AC;&#x153;Next year,â&#x20AC;? said Pierre-Louis de Guillebon, CEO of Orange International Carriers. â&#x20AC;&#x153;Next year is realistic,â&#x20AC;? agreed Eduardo Guardincerri, CMO of TelefĂłnica. Both were responding to a question from Jussi Makela, who was moderating a panel at the conference. He

is director of the International Telecoms Week (ITW) Global Leadersâ&#x20AC;&#x2122; Forum (GLF), the industry organisation that has run the proofs of concept since the project began a year ago at the 2017 Capacity Europe event. (Full disclosure: Makela is part of the team at Capacity Media, the company that publishes Capacity and produces Capacity events and ITW.) â&#x20AC;&#x153;When will you settle the first live transaction?â&#x20AC;? Makela asked the panellists at the conference. Marc Halbfinger, CEO of PCCW Global and chair of the GLF, said: â&#x20AC;&#x153;We introduced this topic at this event one year ago. In less than 12 months look at what weâ&#x20AC;&#x2122;ve achieved. Instead of settling in one to three months itâ&#x20AC;&#x2122;s two to five minutes. This is a huge achievement.â&#x20AC;? But wide adoption for blockchainbased voice settlement â&#x20AC;&#x153;depends on the industry getting on boardâ&#x20AC;?, he said. John Sullivan, head of global voice at Telstra, was bullish about a go-live date for commercial operation: â&#x20AC;&#x153;Probably in March next year,â&#x20AC;? he said. Halbfinger warned that it made sense only if the approach was â&#x20AC;&#x153;adopted by the whole industryâ&#x20AC;?. The GLF â&#x20AC;&#x153;wants to move forward collectively as an industry bodyâ&#x20AC;?. Before that can happen, the industry needs a common interface, he said.

Louisa Gregory, chief of staff at Colt, said her company wanted to move to blockchain technology because â&#x20AC;&#x153;we have a large base of capital markets customers that are already looking at this technologyâ&#x20AC;?. I spoke to Haggiag the week after Capacity Europe. â&#x20AC;&#x153;Wholesale voice is moving towards a production network,â&#x20AC;? he told me. â&#x20AC;&#x153;We see very strong interest. Other companies that were not part of the proofs of concept are interested in joining the production network. This is very encouraging as one of the challenges is how to make the most out of this technology.â&#x20AC;? There needs to be wide participation across the wholesale voice industry for it to be successful, he suggested. â&#x20AC;&#x153;At the moment we are working just with GLF members. There is strong interest in these companies. Once there is a critical mass, others will want to join.â&#x20AC;? What is a critical mass? Haggiag put some figures on it, comparing the still unnamed telecoms blockchain system with Ripple, a payments network for money transfer run by banks. Haggiag believes that the GLF network could have 150 members using blockchain for wholesale voice settlements by the end of 2019. How big is that market? â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s december/january 2019

feature: blockchain | 27

around $13 to $14 billion a year based on the world in seconds “directly from based and cloud-based project to improve the information we have,” said Katia company A to company B”, using the routing of international calls. The Gonzalez, head of fraud prevention blockchain technology. IMC charges a flat company wants to track in real time each operations and services at BICS. rate for “international settlements international call, including origin, Meanwhile, said Haggiag, Clear anywhere in the world” of just $10, “and destination and duration, and make that Blockchain Technologies is looking we pay a monthly bonus with the account”, information available to all the operators beyond wholesale voice to other sectors of which Stewart likened to interest. carrying the call. the telecoms industry. As well as the GLF, Gonzalo Martín-Villa, chief innovation Traditional banks take “three to five days Clear has been working with the MEF to make the transaction”, he added. officer of Telefónica, said in November: – the former Metro Ethernet Forum – on IMC has “1,000 members from 120 “Blockchain will allow operators to a number of proofs of concept that were countries”, he said. “All the members are generate a new layer of confidence in the shown at its conference in late October. trusted telecoms companies.” BoT “has internet – based not on the players that “We showed bandwidth on demand, generate the data and the transactions but the potential” to be the main route for quoting price in real time as well as moving money around the telecoms on the data itself.” execution and industry, said delivery Stewart when monitoring, I interviewed invoicing based him in on monitoring October at and then Capacity payment – all Europe. “We based on already have blockchain.” the customers. This proof of And we are Eran Haggiag, chairman, Clear Blockchain Technologies concept involved regulated by Liquid Telecom, the Malta PCCW Global, Sparkle, Singtel and Tata Financial Services Authority.” The company will use IBM’s own The Sphere, which is also a company Communications. “We took its product blockchain platform running in IBM’s made up of telecom industry veterans, catalogue from each company and showed cloud to improve “the reliability and also offers a blockchain-powered global how in real time you can ask for prices.” transparency of information collected by Capacity ecosystem, backed by $6 million capital That included services that one company different networks when routing investment. Through a single took from another’s catalogue to offer to international call”. the prospective end user, without showing Martín-Villa added: “This project is one interconnection, the Sphere enables carriers and operators to “remove details. “You can give an aggregate quote. of our first initiatives to secure real commercial inefficancies and operational Today that takes a week or more.” benefits from the adoption of blockchain Why do you need blockchain for that? challenges” by tackling fraud. in our core business.” The telecom industry is at a “You don’t want a central register of Never break the chain crossroads,” said Yariv Trabelsi, CTO of services,” explained Haggiag. “Each Back at Capacity Europe, Telstra’s Sullivan The Sphere. “It needs to evolve in order company exposes its services only to agreed that blockchain is needed in the to stay relevant and turn a profit. Typical partners and then aggregates delivery and voice business. “It is a high-volume, margins in the middle market used to creates automatic settlement and creates low-margin, cash-flow business – and run between 10% and 12%; now, they’re cryptographically signed invoices.” therefore you need fast cash flow,” he said. closer to three percent or less. How will blockchain be implemented He wanted more applications of blockchain. Meanwhile, the retail side is struggling to across the wholesale industry? “It makes “We need to accelerate the proof of concept handle the increasing amount and most sense that there will be one network and develop it further,” he said, suggesting severity of fraud. As concerned telecom for telcos, working together,” Haggiag the industry could try the technology for industry veterans, we decided to solve for told me. “There could be multiple areas such as internet of things. these challenges by creating The Sphere, vendors, but then you would need PCCW Global’s Halbfinger asked: which is a seismic development for the standardisation and open APIs to enable “What is the right structure that the market — and this is just the beginning.” multi-vendor systems to be interoperable. industry needs to deliver the technology? Just as I asked Haggiag why If the markets adopt it by the end of 2019 How can this allow us a more dynamic blockchain is needed, I also asked IMC’s it will be a very big blockchain system settlement environment?” Stewart the same question. “The beauty – something that the telecoms industry Meanwhile there is already a relatively of our solution is you have a crypto key can be proud of.” unsung company that is already using in your browser,” he replied. “The Clear has also worked on blockchain blockchain to help the industry. Internet customer controls access to the account. applications for industries such as energy, Mobile Communications (IMC) has been The network can’t be hacked. We are insurance, pharmaceutical and around since 2012 and in August 2018 it pegged to the US dollar – the interadvertising, but “our main focus now and registered a subsidiary as a financial national currency for settlements. No almost all of our resources are tuned into institution in Malta, an EU member hedging is required. It is a stable token.” the telecoms industry and the successful state. The Bank of Telecom (BoT) has its What are the challenges? Stewart also launch of the production network”, he own blockchain-based currency, echoed people connected to the GLFadded. He wants to get to 50% of the BoTCoin. “Our token is linked to the US backed blockchain projects. “Market wholesale voice market “as quickly as dollar,” said CEO Mark Stewart. “One awareness was the initial challenge, but possible”. He added: “Once we reach that blockchain has become more familiar,” he we’ll be able to go back to other markets.” BoTCoin is worth $1, and we use it for said. Indeed, you’ll be reading more and Separately, Telefónica has announced it international settlement.” Money is moved in BoTCoins around more about it in telecoms. is working with IBM in a blockchain-

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We took its product catalogue from each company and showed how in real time you can ask for prices ”

capacitymedia.com

It’s Better Within The Sphere. ™

]¬Ä¤ê½ Ú ËÞüÞæ ÃɌ Global Reach. .æɹÞ ææ Ú s¬æ©¬Ä c© ]×© Ú c© ]×© Ú ¬Þ ¤½Ë ½ æ ½ ËÃ ËÞüÞæ Ã ö¬æ© Ä û © Ä¤ ×½ æ£ËÚÃ æ ¬æÞ ËÚ ɇ £ ¬½¬æ æ¬Ä¤ Ãê½æ¬× Úæü © ¬ÄɬæÚ ¬Ä¤ɇ ÚËêæ¬Ä¤ Ä ĈÄ Ä ¬ ½ Þ ææ½ Ã ÄæÞ ¬Ä Ú ½ time. It’s the solution the industry has been waiting for.

The Sphere: Revolutionizing Telecom The telecommunications industry has reached a critical juncture. While carriers’ revenues continue to grow, æ© ¬Ú © ½½ Ä¤ Þ Ú ¤ Ú ¬Ä¤ Ã Ú¤¬ÄÞ × ÚÞ¬Þæ êÞ ö Ú Ã ¬Ä æÚ ×× ¬Ä æ© ËÄõ Äæ¬ËÄ ½ɇ ü æ ¬Ä Ć ¬ Äæ ÄËÚÃÞ æ© æ © õ © ½ êÞ ºɌ c© ¬Ä êÞæÚü Ä Þ êÄ¬Ĉ ×½ æ£ËÚÃ æ© æ Ë×æ¬Ã¬ā Þ Ä æöËÚº Ë× Ú æ¬ËÄÞɇ ÞæÚ Ã½¬Ä Þ ËÃÃ Ú ¬ ½ ×ÚË ÞÞ Þ Ä Þ êÚ Þ ĈÄ Ä ¬ ½ æÚ ÄÞ æ¬ËÄÞɌ c© ]×© Ú ɫ ½Ë º © ¬Äɬ×Ëö Ú ¤½Ë ½ Capacity æ ½ ËÃÃêÄ¬ æ¬ËÄÞ ËÞüÞæ Ã ö¬æ© Ä û © Ä¤ ×½ æ£ËÚÃ æ ¬æÞ ËÚ ɬ ¬Þ æ© ÞË½êæ¬ËÄ ö ɹõ Ä ö ¬æ¬Ä¤ £ËÚɌ VËö Ú ü õ Ä Ä êÚ ½ Ä æöËÚº ÞüÞæ ÃÞ Ä êææ¬Ä¤ɬ ¤ ɇ ¤½Ë ½½ü ¬ÞæÚ¬ êæ ɇ ©ü Ú¬ ¬Ä£Ú ÞæÚê æêÚ ɇ c© ]×© Ú £ ¬½¬æ æ Þ Ãê½æ¬ɬ× Úæü © ¬ÄɬæÚ ¬Ä¤ɇ ÚËêæ¬Ä¤ Ä ĈÄ Ä ¬ ½ Þ ææ½ Ã ÄæÞ ¬Ä Ú ½ æ¬Ã ɇ ½½Ëö¬Ä¤ ÚÚ¬ ÚÞ and operators to buy, sell and resell without limitations. It enables operations between users, delivering êÄ× Ú ½½ ½ Þæ ¬½¬æüɇ êÄ¬õ ÚÞ ½ Ú êÄ Ä ü Ä êÄ½¬Ã¬æ Þ ½ ¬½¬æü Ä ĉ û¬ ¬½¬æüɌ ¬æ¬ËÄ ½½üɇ æ© ĈÄ Ä ¬ ½ ÃË ê½ æÚ ºÞ Ä ·êÞæÞ õ Úü æÚ Ä ÚËêæ ½½ɇ ½¬õ Ú¬Ä¤ Ú ½ɬæ¬Ã ¬½½¬Ä¤ Ä ĈÄ Ä ¬ ½ Ú ËÄ ¬½¬ æ¬ËÄÞ across the entire trade chain. s¬æ© Ä ö Ú ɬö¬ÄÄ¬Ä¤ ½Ëê Ä æöËÚº æ ¬æÞ ËÚ ɇ c© ]×© Ú ½ õ Ú ¤ Þ ¬ÄÄËõ æ¬õ æ ©ÄË½Ë¤¬ Þ Ä advancements including:

Proprietary Routing Engine c© ]×© Ú ÄËæ ËÄ½ü Ä ½ Þ êÞ ÚÞ æË Ëą Ú ËÚ ×êÚ © Þ Þ Úõ¬ Þ êæ Ã×Ëö ÚÞ æ© Ú æ¬ËÄ Ë£ Ä ö Þ Úõ¬ ÞɌ YËêæ¬Ä¤ ×½ ÄÞ Ú ËÃ×½ æ ½ü êÞæËÃ¬ā ½ Ä Ä Ã £ÚËÃ æ© æÚ ¬Ä¤ ĉËËÚ ü Þ êÚ¬Ä¤ ÚËêæ Þ ×Ú¬õ æ ½ü ËÚ ×ê ½¬ ½üɌ .Ä ¬æ¬ËÄɇ c© ]×© Ú ɹÞ ×ÚË×Ú¬ æ Úü ÚËêæ¬Ä¤ Ä¤¬Ä ÄÞêÚ Þ æ© æ © ½½ ÚËÞÞ õ Úü ½ õ ½ Ë£ æ© æÚ © ¬Ä £Ë½½ËöÞ êÞ ÚÞɹ × Úæ¬ ê½ Ú Þ æÞ Ë£ ÚËêæ¬Ä¤ Úê½ Þ Ä ×Ú £ Ú Ä Þɇ ½½Ëö¬Ä¤ ÚÚ¬ ÚÞ æË Ú æ ÚËêæ Þ Þ× ¬Ĉ æË æ© ¬Ú Ä ÞɌ .Ä ·êÞæ Ã ææ Ú Ë£ Ã¬½½¬Þ ËÄ Þɇ c© ]×© Ú æ ÚÃ¬Ä Þ æ© Ú ¬æ öËÚæ©¬Ä ÞÞ ËÚ ĈÄ Ä ¬ ½ ©Ë½ ¬Ä¤Þ Ë£ æ© ½½ ËÚ¬¤¬Ä æËÚ æË ×ÚËõ¬ Þ êÚ¬æü Ä ËÄɬ Ã Ä × üÃ Äæ ¬Þ êÚÞ Ã Äæ Ë×æ¬ËÄÞ æË © × Úæü throughout the trade chain.

Visit us at www.thesphere.io to learn more

Seamless Global Network

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Live Anti-Fraud Engine

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Live QoS and Bid-On-Live Engine

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More About The Sphere Which types of organizations connect to The Sphere?

+Ă&#x2039;Ăś ÂŹĂ&#x17E; cÂŠÂ&#x2122; ]Ă&#x2014;ÂŠÂ&#x2122;Ă&#x161;Â&#x2122; Â&#x2022;ÂŹÄ&#x2026;Â&#x2122;Ă&#x161;Â&#x2122;Ă&#x201E;ĂŚ ÂŁĂ&#x161;Ă&#x2039;Ă&#x192; Ă&#x2039;ĂŚÂŠÂ&#x2122;Ă&#x161; telecom carrier portals?

Tier 1, 2 and 3 carriers, operators, resellers and ĂśÂŠĂ&#x2039;Â˝Â&#x2122;Ă&#x17E;Â&#x201A;Â˝Â&#x2122; Ă&#x2014;Ă&#x161;Ă&#x2039;ĂľÂŹÂ&#x2022;Â&#x2122;Ă&#x161;Ă&#x17E; Ă&#x2039;ÂŁ Â&#x201A;Â˝Â˝ Ă&#x17E;ÂŹÄ Â&#x2122;Ă&#x17E;É&#x152; cÂŠÂ&#x2122; Â&#x2122;Â?Ă&#x2039;Ă&#x17E;ĂźĂ&#x17E;ĂŚÂ&#x2122;Ă&#x192; ÂŠÂ&#x2122;Â˝Ă&#x2014;Ă&#x17E; Â˝Â&#x201A;Ă&#x161;Â¤Â&#x2122;Ă&#x161; Â?Â&#x201A;Ă&#x161;Ă&#x161;ÂŹÂ&#x2122;Ă&#x161;Ă&#x17E; Â&#x201A;Â&#x2022;Â&#x2022;Ă&#x161;Â&#x2122;Ă&#x17E;Ă&#x17E; Â&#x2022;Â&#x2122;Â?Â&#x201A;Â&#x2022;Â&#x2122;Ă&#x17E;ÉŹĂ&#x2039;Â˝Â&#x2022; Â?ÂŠÂ&#x201A;Â˝Â˝Â&#x2122;Ă&#x201E;Â¤Â&#x2122;Ă&#x17E;É&#x2021; Ă&#x17E;ĂŞÂ?ÂŠ Â&#x201A;Ă&#x17E; Ă&#x161;Â&#x201A;Ă&#x192;Ă&#x2014;Â&#x201A;Ă&#x201E;ĂŚ ÂŁĂ&#x161;Â&#x201A;ĂŞÂ&#x2022; Â&#x201A;Ă&#x201E;Â&#x2022; Ă&#x2122;ĂŞÂ&#x201A;Â˝ÂŹĂŚĂź Ă&#x2039;ÂŁ Ă&#x17E;Â&#x2122;Ă&#x161;ĂľÂŹÂ?Â&#x2122; Â?Ă&#x2039;Ă&#x201E;Â?Â&#x2122;Ă&#x161;Ă&#x201E;Ă&#x17E;É&#x152; cÂŠÂ&#x2122; ]Ă&#x2014;ÂŠÂ&#x2122;Ă&#x161;Â&#x2122; ÂŹĂ&#x17E; Â&#x201A;Â˝Ă&#x17E;Ă&#x2039; Ă&#x2014;Â&#x2122;Ă&#x161;ÂŁÂ&#x2122;Â?ĂŚ ÂŁĂ&#x2039;Ă&#x161; Ă&#x17E;Ă&#x192;Â&#x201A;Â˝Â˝ ĂŚĂ&#x2039; Ă&#x192;ÂŹÂ&#x2022;ÉŹĂ&#x17E;ÂŹÄ Â&#x2122;Â&#x2022; Â?Ă&#x2039;Ă&#x192;Ă&#x2014;Â&#x201A;Ă&#x201E;ÂŹÂ&#x2122;Ă&#x17E; ĂŚÂŠÂ&#x201A;ĂŚ Â&#x201A;Ă&#x161;Â&#x2122;Ă&#x201E;ÉšĂŚ Â&#x201A;Â&#x17D;Â˝Â&#x2122; ĂŚĂ&#x2039; Â?Ă&#x2039;Ă&#x192;Ă&#x2014;Â&#x2122;ĂŚÂ&#x2122; ĂśÂŹĂŚÂŠ Â&#x17D;ÂŹÂ¤ Â?Â&#x201A;Ă&#x161;Ă&#x161;ÂŹÂ&#x2122;Ă&#x161;Ă&#x17E; Â&#x17D;Â&#x2122;Â?Â&#x201A;ĂŞĂ&#x17E;Â&#x2122; Ă&#x2039;ÂŁ ĂŚÂŠÂ&#x2122; Â&#x201A;Ă&#x192;Ă&#x2039;ĂŞĂ&#x201E;ĂŚ Ă&#x2039;ÂŁ investment they have to incur. By lowering the Â&#x17D;Â&#x201A;Ă&#x161;Ă&#x161;ÂŹÂ&#x2122;Ă&#x161;Ă&#x17E; ĂŚĂ&#x2039; Â&#x2122;Ă&#x201E;ĂŚĂ&#x161;Ăź ÂŁĂ&#x2039;Ă&#x161; Ă&#x17E;Ă&#x192;Â&#x201A;Â˝Â˝Â&#x2122;Ă&#x161; Ă&#x2014;Ă&#x161;Ă&#x2039;ĂľÂŹÂ&#x2022;Â&#x2122;Ă&#x161;Ă&#x17E;É&#x2021; ĂŚÂŠÂ&#x2122; Ă&#x2014;Â˝Â&#x201A;ĂŚÂŁĂ&#x2039;Ă&#x161;Ă&#x192; Â˝Â&#x2122;ĂľÂ&#x2122;Â˝Ă&#x17E; ĂŚÂŠÂ&#x2122; Ă&#x2014;Â˝Â&#x201A;ĂźÂŹĂ&#x201E;Â¤ Ä&#x2C6;Â&#x2122;Â˝Â&#x2022;É&#x152;

We created the ecosystem and portal with Â&#x17D;Â&#x2122;Ă&#x17E;ĂŚÉŹĂ&#x2039;ÂŁÉŹÂ&#x17D;Ă&#x161;Â&#x2122;Â&#x2122;Â&#x2022; ĂŚÂ&#x2122;Â?ÂŠĂ&#x201E;Ă&#x2039;Â˝Ă&#x2039;Â¤Ăź Ă&#x2014;Â&#x201A;Ă&#x161;ĂŚĂ&#x201E;Â&#x2122;Ă&#x161;Ă&#x17E; Â&#x17D;Â&#x201A;Ă&#x17E;Â&#x2122;Â&#x2022; Ă&#x2039;Ă&#x201E; Ă&#x2039;ĂŞĂ&#x161; ĂŚÂ&#x2122;Â&#x201A;Ă&#x192;ÉšĂ&#x17E; Â?Ă&#x2039;Â˝Â˝Â&#x2122;Â?ĂŚÂŹĂľÂ&#x2122; Â&#x2022;Â&#x2122;Â?Â&#x201A;Â&#x2022;Â&#x2122;Ă&#x17E; Ă&#x2039;ÂŁ ĂŚÂ&#x2122;Â?ÂŠĂ&#x201E;ÂŹÂ?Â&#x201A;Â˝ Â&#x2122;ĂťĂ&#x2014;Â&#x2122;Ă&#x161;ĂŚÂŹĂ&#x17E;Â&#x2122;É&#x152; Nothing is third party or white labeled. The entire system, including all algorithms, is built, designed, ÂŹĂ&#x192;Ă&#x2014;Â˝Â&#x2122;Ă&#x192;Â&#x2122;Ă&#x201E;ĂŚÂ&#x2122;Â&#x2022; Â&#x201A;Ă&#x201E;Â&#x2022; Ă&#x192;Â&#x201A;Ă&#x201E;Â&#x201A;Â¤Â&#x2122;Â&#x2022; Â&#x17D;Ăź cÂŠÂ&#x2122; ]Ă&#x2014;ÂŠÂ&#x2122;Ă&#x161;Â&#x2122;É&#x152; cĂźĂ&#x2014;ÂŹÂ?Â&#x201A;Â˝Â˝ĂźÉ&#x2021; Â&#x201A;Ă&#x201E; Ă&#x2039;Ă&#x161;Â¤Â&#x201A;Ă&#x201E;ÂŹÄ Â&#x201A;ĂŚÂŹĂ&#x2039;Ă&#x201E; Ă&#x192;ÂŹÂ¤ÂŠĂŚ Ă&#x17E;Â&#x201A;Ăź ÉśÂŠÂ&#x2122;Ă&#x161;Â&#x2122; ÂŹĂ&#x17E; Ă&#x192;Ăź Ă&#x17E;ĂśÂŹĂŚÂ?ÂŠÉ&#x2019;ÂŁĂŞĂ&#x201E;Â?ĂŚÂŹĂ&#x2039;Ă&#x201E;Â&#x201A;Â˝ÂŹĂŚĂźÉˇ Â&#x201A;Ă&#x201E;Â&#x2022; Â?Ă&#x2039;Ă&#x192;Ă&#x2014;Â&#x201A;Ă&#x201E;ÂŹÂ&#x2122;Ă&#x17E; ÂŠÂ&#x201A;ĂľÂ&#x2122; ĂŚĂ&#x2039; Â˝Â&#x2122;Â&#x201A;Ă&#x161;Ă&#x201E; ÂŠĂ&#x2039;Ăś ĂŚĂ&#x2039; ĂŞĂ&#x17E;Â&#x2122; ÂŹĂŚÉ&#x152; sÂŹĂŚÂŠ cÂŠÂ&#x2122; ]Ă&#x2014;ÂŠÂ&#x2122;Ă&#x161;Â&#x2122;É&#x2021; ĂśÂ&#x2122; ĂŚĂ&#x2039;Ă&#x2039;Âş Â&#x201A; Ă&#x192;ĂŞÂ?ÂŠ Â&#x2022;ÂŹÄ&#x2026;Â&#x2122;Ă&#x161;Â&#x2122;Ă&#x201E;ĂŚ Â&#x201A;Ă&#x2014;Ă&#x2014;Ă&#x161;Ă&#x2039;Â&#x201A;Â?ÂŠÉ&#x152; sÂ&#x2122; Â&#x201A;Ă&#x161;Â?ÂŠÂŹĂŚÂ&#x2122;Â?ĂŚÂ&#x2122;Â&#x2022; Ă&#x2039;ĂŞĂ&#x161; Ă&#x2014;Â˝Â&#x201A;ĂŚÂŁĂ&#x2039;Ă&#x161;Ă&#x192; Â&#x201A;Ă&#x201E;Â&#x2022; data models to the carrier/person that is using it.

Visit us at www.thesphere.io to learn more

30 |

The move to inter-carrier

collaboration It has been over a year since PCCW Global, the international arm of HKT, completed a deal to buy Console Connect. James Pearce sat down with CEO Marc Halbfinger: Capacity integration of the platform is going ‘outstandingly well’

’m very enthusiastic about inter-carrier orchestration,” admits PCCW Global CEO Marc Halbfinger CEO, as we sit down to discuss its acquisition of Console Connect a year after the deal was announced. The deal, announced in November 2017, saw PCCW Global acquire Console Connect’s brand, platform and technology team, but its network assets and customer contracts were hived off and put under separate ownership under the name IX Reach. I interviewed Halbfinger at a MEF event just weeks after the deal was completed and he seemed confident that the acquisition would give PCCW Global an opportunity to increase the depth of its capability around software development and agile development. “The team we acquired – a few people in California, a few in Europe, but the bulk in Brisbane, Australia – have become the hub of technology development and innovation at PCCW Global,” Halbfinger explains. Paul Gampe, who was previously CTO

of Console Connect, has also become CTO of PCCW Global. “We have, for the past year, used the tagline internally that we didn’t acquire Console Connect for it to be integrated into PCCW Global, but rather we acquired Console Connect so PCCW Global can be integrated into it,” he adds. “Console Connect was a software-only platform – we left the network elements – and we have, in less than a year, been able to write the code to integrate it into our systems.” This time, I sat down to interview the CEO, who also chairs the Global Leaders’ Forum, in PCCW Global’s London office, but he is sitting in the company’s Hong Kong headquarters and we chat over its video conferencing system. What does “outstandingly well” mean in terms of numbers? Halbfinger says Console Connect is now enabled at more than 70 of PCCW Global’s data centre locations. It is on-net in over 33 countries across four continents, and integrates cloud providers including Alibaba, Tencent, Amazon Web Services, Microsoft Azure and Google Cloud.

Console was acquired with cloud-tocloud capability. After four months the team was also able to facilitate network-tocloud capability, says Halbfinger. “Around a month and a half ago, we completed production work on our first line of network-to-network automation with a customer. That means our customer can come in and provide us with two points on-net. Provided there is x amount of bandwidth on either side they are able to automate anywhere up to x bandwidth on an on-demand basis.” This, he adds, is potentially “huge” as a new network capability. So what next for the integration? PCCW Global plans to “enhance the network capability geographically, to access as many clouds, to start the process now of interoperating with other network-based service providers technically and commercially.” Carrier co-operation and inter-carrier collaboration is something Halbfinger has been driving for a number of years. He’s a big fan, he adds. However, to really get this to function, the industry needs a serious shift. It needs to move to a new december/january 2019

the big interview: marc halbfinger | 31

1988

Cable TV, Directories, Cellular, Business Development & Regulatory

1993

Director, Sprint International

1997

VP, Teleglobe

2000

SVP Business Development, Pacific Century Convergence

2001

SVP Europe, Mideast Africa, BTN, a PCCW Company

2006

COO, PCCW Global

2007

CEO, PCCW Global

commercial on-demand model, something being looked at by the GLF. One of the GLF projects is around blockchain. Key wholesale carriers are aiming to put their blockchain-based voice settlement system into commercial operation as soon as possible – perhaps as early as March 2019, a panel at Capacity Europe heard. PCCW Global, alongside Colt, was one of the first carriers to demonstrate how carriers can work bilaterally to demonstrate how the inter-carrier settlement of wholesale international voice services could be automated through the use of blockchain. (For more on blockchain see pages 26-27.) The need for a new model filters through to the blockchain story “because we think that one of the keys for getting us going from an interoperability point of view is ensuring the backend is automated as well – sourcing, quoting, provisioning and settlement –which takes place at the inter-operator level for bandwidth capability,” he explains. “If you go cloud-to-cloud or network-to-cloud you capacitymedia.com

don’t need the same ubiquitous structure from the backend all the way to the front end that you need for operator-tooperator. That’s where we are headed and all of that is very innovative.” One thing that strikes me is that, if the backend functionality such as settlements are automated through blockchain or another system, it could have a major impact on people working at carriers. I put this to Halbfinger. He says “any economic transition” has an impact on staff base, but this is less like to affect the front-end workers who deal with contracts. The people who manage the backend – measuring, clearing, verifying, disputing and settling – “may see their activity impacted”, however. Halbfinger is keen to point out that, although this new technology can help to create efficiencies, he sees this as an opportunity for people working in the industry. He explains: “I see the positive side of that on individuals who are engaged in the industry, provided they are willing to train up to fit the new environment.” He adds: “One thing I think is a truism now is that the pace of change is so rapid. If we as individuals are unwilling to retool Capacity then we will struggle to keep up. Myself included.”

PEACE de resistance I’ve sat down with Halbfinger at busy time for PCCW Global. Beyond it continuing integration and expansion of the Console Connect platform, the Hong Kong-based company has also made a number of significant announcements. One of the most recent was around the PEACE subsea cable system, with PCCW Global and Orange partnering to land the cable system in Marseille. PEACE, which stands for Pakistan and East Africa Connecting Europe, is a 12,000km long system which is due to be ready for service in 2020. (Find out more about this cable in our exclusive interview with PEACE COO Xiaohua Sun on pages 56-57.) PCCW Global became involved at the request of Chinese technology and industrial firm Hengtong, which is behind the cable project, and manufacturer Huawei Marine, which is building it. When complete, the high-speed PEACE cable system will offer the shortest routes from China to Europe and Africa, interconnecting three of the world’s most populous continents while at the same time dramatically reducing latency, delivering a superior connectivity experience which will be ideal for a vast array of commercial and consumer applications. “We believe Hengtong’s work is really top notch and they asked us to be involved because we know the market. They offered to

create a collaborative environment where PCCW Global can be a channel to develop these systems which we believe fit market demands. For PCCW Global, beyond its network capability, on a people side is a great value set – we have many western people and many Asian people, including a strong view of China.” PCCW Global’s role in the PEACE Cable is part of its involvement in China’s One Belt, One Road initiative – a key strategy of Chinese president Xi Jinping to enhance regional connectivity while promoting Chinese enterprises across countries in Europe, Asia and Africa. For PCCW Global, its infrastructure – including PEACE – will help play a key role in helping “facilitate the expansion of Chinese enterprises into other markets along the one belt, one road environment”, says Halbfinger. PEACE is a “natural, privately capitalised extension of what is necessary for One Belt, One Road”, he adds. The PEACE Cable lands in Djibouti. Does this mean we’ll be seeing increased activity from PCCW Global in the East Africa region? Halbfinger replies: “Because there will be Chinese capacity coming terrestrially through Pakistan, it will be one of the shortest hops from mainland China to East Africa. We’ve been seeing investment from China in Africa, and we see this as a logical progression of economics by producing more capacity on that route.”

UCaaS Another recent announcement from PCCW Global was that PLDT, a telecoms operator in the Philippines, has turned to the Hong Kong-based company for unified communications (UC) voice services. When I ask Halbfinger about this, he points out that we are chatting on a UC tool – one supported by PCCW Global’s own network. He adds: “PLDT’s enterprise team reviewed what we were doing at both the wholesale and retail level, and asked whether we’d be willing and able to facilitate their downstream retail environment at the wholesale level to effectively use our physical and software infrastructure. We then provide them with a service they can package and brand to have their own qualities and applications so they could deliver value to their end users.” This isn’t the only example of PCCW Global offering this service. He alludes to two other European partners that offer this service, although these can’t be named, as well as Australian provider Virtutel. With PLDT, it expanded an existing relationship. He adds: “We were eager to work with them. We value the relationship with PLDT greatly and are honoured to work with them.”

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34 |

Theto race

With Verizon and AT&T locked in a race to be the first Western operators to launch a commercial 5G offering, James Pearce spoke to Eric Cevis, of Verizon Partner Solutions, about how the company is being restructured to Capacity meet this goal and drive growth

ith the telecoms industry about to enter the world of 5G networks, carriers are facing a key question: What is the future role of the wholesale community? For Verizon, as one of the biggest mobile providers in the world, this may seem like a strange question. After all, Verizon’s top brass has positioned itself to be one of the leaders in 5G deployments, with its first commercial network due before 2018 ends. When I sit down with Eric Cevis, who heads up Verizon Partner Solutions – the company’s wholesale division – at Capacity Europe, he says even he is focussed on 5G. “We’ve been seeing a lot of growth in areas like wireless transport – both lit and dark services,” he explains. “For a lot of the wireless carriers that’s the one vertical that still has good growth. That’s why I’ve formed a team in three areas – one on wireless, one looking at North American sales, and the third is the international arm. We rely on all three pieces to figure out our growth portfolio. Wireless transport is starting to

open up more and more opportunities in the wireless carrier space for us.” Mobile, of course, doesn’t just mean mobile phones – there is also a substantial growth in demand for internet of things (IoT) services. Verizon is heavily focussed on this area too, seeing it as a significant new growth opportunity on top of its existing business. Cevis explains: “The real growth is trying to find new applications and opportunities to put on top of the basic connectivity services. We’re talking about IoT, which we’re aggressively growing in through SIM-card partners (with Verizon Wireless) and a lot of connection-based conversations with our partners. Recently we secured a deal looking at four use-cases – smart meters, asset tracking, wearables and shareables.” The fifth area Verizon is looking at is automobile tracking. “We’ve diversified our portfolio to look for new growth opportunities, adds Cevis. This involved the launch of Verizon Connect in March, utilising its acquisitions of Fleetmatics and Telogis.” Within this diversification, Verizon has

seen some significant management changes, most notably at the highest level, with Lowell McAdam, who led parent company Verizon Communications as CEO from 2011 until August 2018. McAdam is still involved, serving as executive chairman, but his replacement as CEO – and Cevis’s new boss – is former Ericsson CEO Hans Vestberg, who joined Verizon as CTO in 2017. Vestberg from the off made it clear that he plans to overhaul Verizon’s structure – a plan that was unveiled in November when he outlined a new, three-pronged approach to the company. This will be see Verizon focus on three customer-facing areas – consumer, business and media – effective from the beginning of 2019. These operating units will be underpinned by a central network and IT organisation, along with corporatewide staff functions. A spokesperson for the company told Capacity that its wholesale arm, Verizon Partner Solutions, will become part of Verizon Business Group, with Cevis continuing to oversee the division. Verizon Business Group will look after its wireless and wireline enterprise businesses, december/january 2019

the big interview: eric cevis | 35

1986

Staff supervisor, government systems, Bell Atlantic

2003

VP business wholesale marketing, Verizon Retail Markets Group

2003

VP business channel development, Verizon Retail Markets Group

2006

VP Business, Verizon Communications

2014

President, Verizon Partner Solutions

will be looking at partnership,” he adds. “Verizon used to organically build everything ourselves, but now we’re more into this inorganic partnership model because it allows you to scale quicker.” Recent partnerships have included a proof of concept with Colt Technology Services, which saw the two companies working together to showcase near real-time bandwidth changes in each other’s production networks. This included a live demo in London, and is part of wider work with MEF (formerly the Metro Ethernet Forum) on developing industry standards for inter-carrier business and lifecycle service orchestration APIs. “The work we’ve been doing with the likes of MEF and TM Forum is important,” says Cevis. “With that, we’re not doing anything that is proprietary – we’re building on an open source basis that allows us to scale more easily.” As a veteran of the wholesale industry, Cevis explains that this move to partnerships, and away from the traditionally transactional nature of relationships, has been one of the biggest changes of late.

Enormous experience

small and medium-sized business unit, and also its government offering. Wireline wholesale, plus the company’s telematics arm, Verizon Connect, will also fall into this unit, which will be led by EVP of wireless operations Tami Erwin.

Sense of urgency Cevis explains: “I’ve been in the company for 32 years now and it is interesting to see the transition over that time. I come from the Bell Atlantic side of the house. I’ve seen Ray Smith, Ivan Seidenberg and Lowell McAdam. Hans is a mover. He likes to see things happen and is a fast study. That sense of urgency is important – he likes being first. He joined as our chief network and IT officer, and it’s interesting seeing him become CEO because he’s putting a network-centric approach with a sense of urgency around leading the market place.” The new strategy will be up and running in January, with 5G and network superiority the “drumbeat across the board” he claims. What about all of the other bits that make up a modern, high-speed network? “For the other pieces of the equation we capacitymedia.com

He says: “Verizon Capacity has been in the wholesale game for a very long time – but we’re also a global company ourselves. This gives us an enormous amount of experience and expertise. We also have a great variety of innovative products and services that can change our customers’ business opportunities. This combination of best-in-class solutions, expertise and experience works best when our customers become our partners.” Cevis says his team is focussed across three primary sales leads: one on wireless areas, one looking at North American sales, and the third is the international arm. He adds that it is “important” for Verizon Partner Solutions to push these leads while also making sure the work it does internationally – in Hong Kong, EMEA and Latin America – still brings value, He adds: “Some of that is through partnerships – we partnered with the likes of Colt, and we’re talking to NTT right now about whether we can carry out an interoperable software-defined conversation. This is so we have more than one SDN testbed going forward.” From a wholesale point of view, “I’m a true believer” says Cevis, adding that even in the US “not everyone realises how many networks we are a part of”. On the international stage, Verizon is not the incumbent. That means communicating through partnerships and joint ventures the work it is doing. “That’s how we’ll continue.” Verizon has “never tried to surprise anyone in that we’re not putting as much of an

investment on the international side as we are on the domestic side. We’re finding that a lot of revenue is coming from partnerships on a global basis.” On investment, Cevis says we are unlikely to see Verizon ploughing big spending into new subsea cable systems, but there is likely be investment into fibre. Why? Because to meet the 5G objectives outlined by Verizon Wireless, there needs to be more fibre in the ground. “If you look at our investment, the majority has been in the domestic space – notably in Verizon Wireless as we roll out 5G,” he adds. “But for the international piece, we’re picking and choosing – where does it give us the return on investment in the quickest time, usually within three years. “We’re making investment in our Ethernet product because there is growth there. We’re still doing investments in the IP space as we look at public and private IP.”

Growth in voice Despite wider challenges to the voice market, Verizon is seeing growth in voice, according to Cevis. He says: “I’m still investing in voice, too, because it is not going away. It is a sizeable piece of the business, most notably on international voice, and we’ve seen good growth in that area. You need to make sure you’re still delivering a good quality of service there. So still more of that, plus more in the wave space, and more in software-defined. That will be characterised around where there is a good return. For that we need good partners who we can offer that with.” But the focus is fibre. Verizon added 7,000 miles of fibre to its network last year, meaning it owns enough fibre to wrap the moon three times around its equator, according to chairman McAdam. Cevis smiles as he tells me this. “We’re really trying to leverage that while migrating most of our customers from copper to fibre. From there we will be patching it with our SDN, and that is particularly the work we’re doing in wholesale, with the cloud and multi-edge compute.” But ultimately, we come back to 5G. “We’ve been pushing the envelope around 5G and our CEO is very ambitious. He wants to be first. I like that!” he adds, enthusiastically. “There’s a strong opportunity when we’re discussing 5G and the One Network strategy to bring that together. There’s a big plus for the wholesale division there – we believe wholesale gives us the opportunity, where you don’t get retail direct, to get it indirect. We can go to customers on a more indirect basis and this will potentially grow our opportunities in the wholesale business.”

36 |

Asset-light future as wholesale voice

‘legacy’ business consigned to

Bas Burger, the sixth CEO of BT Global Services in 15 years, wants to shift the division to growth sectors and to park traditional areas such as voice Capacity in the legacy category. Interview by Alan Burkitt-Gray

lobal wholesale voice is firmly in the “legacy” category, according to the new CEO of BT Global Services. For Bas Burger, who took the job in mid-2017, legacy is something to ease customers away from – towards what he sees as growth areas, cloud-based services connected via dynamic network services. “We will still do global wholesale voice, until people stop talking,” he tells me. BT Global Services has existing wholesale voice agreements, and it’s not going to cancel them. But it’s not out to win substantial new business. “We’re not going to create a market,” he says. This is a significant step for the international services arm of BT, which makes about a fifth of BT’s total revenue. “We’re aggressively moving what’s legacy into the new world,” says Burger. “For example we have customers with onpremises contact centres. We don’t sell them any more, and we will help customers move to cloud contact centres.” Moving customers to the cloud means

that “we could make less revenue but we will still do it, because the customer gets a more stable environment – and we can innovate and it’s more future-proof.” Burger came into the top job at BT Global Services at a difficult time in what’s long been something of a problem child for the BT group (see panel, page 37), culminating in 2017 when it had to write off £530 million after what the company called “inappropriate behaviour” in BT Italy. The head of BT Europe and the CEO of BT Italia both left. The person then at the top of BT Global Services, Luis Alvarez, fell on his sword, but was not implicated. Burger was flown in from the US to take charge of the operation. He’d been in BT since 2008 but had been president of BT in the Americas since 2013, well away from Italy. In June The Times ran a story that BT had appointed Credit Suisse to find a new owner for BT Italia. Are you selling Italy, I ask Burger. “It’s one of the options,” he says. He was quick to point out that “no countries will be discontinued” from the company’s operations. “We have the

We will still do global wholesale voice, until people stop talking” Bas Burger, CEO, BT Global Services

option of selling assets, but we will not sell countries. We will mainly focus on fewer areas and on becoming more effective.” In October 2018 it sold a German unit, BT Stemmer, which had been in the Global Services group since 2008. Will there be more sales? “We’re actively looking at others,” says Burger. “We have assets – we did buy assets in the past. Our strategy is not to build fibre into cities. We’d rather use Colt. We buy fibre from Zayo and other companies. We own a lot of network between countries, but in-country we use local companies.” He adds: “The way we’re going to be fitter december/january 2019

the big interview: bas burger | 37

1992

Manager, Fifth Generation Systems (acquired by Symantec)

2001

CEO, KPN EnterCom Solutions

2007

EVP, Getronics

2008

CEO, BT Belgium, Netherlands and Luxembourg

2011

President, global commerce, BT Global Services

2012

President, EMEA & Latin America, BT Global Services

2013

President, BT in the Americas, BT Global Services

2017

CEO, BT Global Services

the old technology category,” he says. What’s mature, in Burger’s view, includes conventional MPLS-based services that many international carriers offer. That’s 60%, he says. The final 20% includes three growth areas that Global Services is focusing on – cloud, security and dynamic network services. “We are aiming to become a much more lean and fit future-focused organisation with some very specialist areas,” he says, adding that the unit is focusing on “top 800 multinational companies across the world”. The first of these growth areas is dynamic network services, including software-defined networks and network virtualisation plus services such as bandwidth on demand. “This will connect into where customers have their applications: cloud, data centres – their own or third-party – plus machines and live people.” Second is cloud services, including cloud-based unified communications. The third category is security, “to help customers protect their organisations from cyber threats”. As well as three vertical portfolios, there are three teams within the division, each Capacity addressing separate vertical markets. There’s one for finance and insurance; one for areas such as manufacturing, resources, oil and gas and logistics. The third includes pharmaceutical and

media – led by Jennifer Artley, Burger’s successor as head of BT Americas. One of Artley’s team, Dallas-based Dave Disley, is taking on the legacy wholesale voice business, in succession to Damien Staples, who left BT at the end of October. “It’s a simpler structure,” says Burger. On security, Burger says: “We do firewalls and perimeter defence and they’re important but lots of others do that.What we do really well because we are spread across the world is that we see incidents early.” He means malware and distributed denial of service (DDoS) attacks. “We see them coming and we can defend you before they hit your firewall.” The problem is “expanding at a rapid pace. Every day there are more bad people.” The company also runs a number of security operations centres (SOCs) around the world. There’s one just outside London, and others in India, Australia, Spain and the US “and a new one in France”, he adds. “Security is the fastest growing area for the industry and for BT as topic.” People are an essential part of SOCs, he notes. Much may be automated, “but eventually there is a human who analyses what’s happening. Cybersecurity skills are definitely in high demand, and for a cybersecurity specialist we are a tremendously cool company to work for. In BT you work with a network that spans more than 180 countries.”

Six CEOs of BT Global Services in 15 years and leaner is by focusing on technology that allows us to be asset-light. We don’t need all those assets. We’re actively looking at what to do with those assets.” The process will reduce Global Services’ 17,000 staff now by about a third – in line with the whole BT group’s planned reduction. BT will close its data centres, he says. “We are not a data centre company. We have got 52. Some are very small and easy to wind down.” The load will be moved to BT Global Services’ preferred cloud partners, Microsoft Azure and Amazon Web Services. BT will “move people out and close” its data centres. So it’s clear that any activity that’s not one of Burger’s priorities faces sale or – as looks likely in the case of international wholesale voice – simply being kept trundling along in the background for an indefinite period. “In some cases we’ll stop doing the activity.” Burger says the legacy business in BT Global Services represents around 20% of its sales – which puts it on roughly £450 million in the last half-year. “Voice, including voice conferencing, sits in capacitymedia.com

BT Global Services has had a bumpy decade or so. In 2003 the then CEO, Andy Green, told me that one of its most prized customers was the UK’s National Health Service (NHS), for which it was building the IT infrastructure. BT Global Services made a loss on the NHS project of £1.26 billion in 2008-09. Green’s successor was François Barrault, previously head of BT’s international business. When he left in October 2008, BT had to give a profit warning about the division, but paid him his salary and bonus. A company official said at the time: “We are disappointed at having to make the payment to François but BT honours its legal and contractual obligations.” Group CEO Ian Livingston said: “During the year we have changed the leadership of BT Global Services and started to turn the division around.” Barrault’s replacement at Global Services was the BT’s group CFO, Hanif Lalani, who left suddenly at the start of 2010, after just 15 months. Livingston said: “Hanif and his team have firstly stabilised and then started to turn around the business.” The quick replacement, announced on the day of Lalani’s departure, was Jeff Kelly,

who’d spent his career with IT services group EDS. “My job is to build on these [Lalani’s] foundations,” said Kelly. He left at the end of 2012, and Livingston said he had “transformed” the division. However, Lalani had been implicated in an insider trading deal. Back in October 2007, BT bought two-thirds of a listed Paris company, Net2S, from its founder shareholders in a deal valuing the company at €68.5 million. In 2012 the Autorité des marchés financiers, the stock market regulator of France, fined Lalani €1.5 million and five members of his extended family a total of €4.6 million for insider trading: his relatives had bought Net2S shares in anticipation of BT’s bid. Capacity put these matters to Lalani by email, but we received no comment from him. Kelly’s successor as head of BT Global Services was Luis Alvarez, promoted from president of its operations in Latin America plus Europe, the Middle East and Africa, a role he’d had since 1999. Alvarez survived until June 2017, when he was overtaken by the Italian scandal, though Alvarez was not implicated. Bas Burger is his successor in the top job.

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special report

SUBSEA December/January 2019

CONTENTS 41 Executive interview Greg Twitt, CEO of Globalinx

42 Big interview Michael Francois, technology lead manager of global network infrastructure, EMEA, at Google Cloud

Capacity

45 Saving subsea through diversity The ever-changing role of women in the subsea industry

50 Connecting the world Twleve of Capacityâ&#x20AC;&#x2122;s favourite subsea cable projects

52 From the cable to the grave How is industry managing the increasing number of subsea cables that are reaching the end of their lifecycle?

56 Big interview Xiaohua Sun, chief operatng officer of PEACE Cable

60 A subsea cable industry in transition Market trends and the latest statistics for the industry

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executive interview: greg twitt | 41

HOW GLOBALINX IS MAXIMISING THE CONTINENTAL EDGE Speaking to Natalie Bannerman, Greg Twitt, CEO of Globalinx, discusses the growing popularity of Virginia Beach in the subsea world, what unique opportunities reside there and how Globalinx is capitalising on them

he continental edge is described as the easternmost direct interconnectivity point between Europe and the US. With the major disruption in 2012 that Hurricane Sandy brought to the New York and New Jersey corridors, Virginia Beach has become the obvious safeguard and continental edge location for new transatlantic subsea cables to make terrestrial landfall. One of the companies leading the way in Virginia Beach is Globalinx. The company operates a subsea carrier-neutral colocation campus and cable landing station (CLS) that offers carrier-neutral interconnection capabilities.

facility is less than a mile away from MAREA and BRUSA, and customers can “simply order a cross connect from our facility and be directly connected to these subsea cables via two diverse 864-strand dark fibre network,” he adds. “Globalinx is the only carrier-neutral data centre in Virginia Beach that is diversely connected to Telxius’s CLS,” says Twitt. Additionally, he says, the company is giving carriers and Capacityto extend enterprises the opportunity their backbone to Globalinx’s facility for connectivity to subsea cables as well as giving enterprises a new redundant and diverse location for them to house their servers, connected to three continents.

Though operators still dominate on land, OTTs are gaining a lot of ground in the water” Greg Twitt, CEO, Globalinx

“Virginia Beach is such a strategic and unobstructed location in the ocean for subsea cables to terminate at,” explains Globalinx CEO Greg Twitt. “With over 70% of the world’s data centre traffic being routed through Ashburn in northern Virginia, Virginia Beach now plays a key role in being a major hub to provide the safest and shortest route to Ashburn through the Globalinx ecosystem. Knowing how important diversity and redundancy is to our industry, Virginia Beach has been on a lot of people’s radar for years being viewed as a new continental edge location away from the data centre clusters of New York, New Jersey and Florida.” In addition to its advantageous location and top-tier facilities Globalinx also has the added advantage of Telxius’s MAREA and BRUSA cable systems landing within its campus. Its phase-one capacitymedia.com

“Globalinx is really creating a unique opportunity for the whole industry with our presence on corporate landing parkway and our connectivity to Telxius,” adds Twitt. “It is an exciting time for Globalinx, when folks within the industry mention Virginia Beach, and Globalinx is always brought up. We are for sure creating the next Ashburn, Virginia, on the shores of Virginia Beach.” There are a number of trends affecting the sector as a whole and within subsea it is fair to say that the entry of overthe-top providers (OTTs) and content cables is the biggest one. According to Twitt it was only a matter of time before the OTTs gained entry into the subsea cable market and grow to the dominance we have been seeing and, he predicts, will continue to see. “The OTTs are already at that point of being the biggest carriers of bandwidth

with all the new subsea cables making landfall, and all the new subsea cables being announced are driven by the OTTs,” says Twitt. He believes that the growth of OTTs playing the role of subsea carrier operators will continue, because they need the high capacity and low costs. Over the next five years, the company predicts that OTTs will start to come up with some much-needed new subsea routes. Though operators still dominate on land, OTTs are gaining in their position in the water. Globalinx is the owner-operator of a data centre campus and a CLS, and I was curious to know what side of the argument Twitt sits on when it comes to the growing trend of subsea cables forgoing the CLS and connecting directly at the data centre. He acknowledges the trend is increasing because of its lower cost and route diversification, but he says that this benefits Globalinx. “We bring both our CLS and data centre campus to subsea cable owners”. Globalinx’s campus is less than 10 miles from the ocean, reducing risk. Looking ahead, the economics of connecting at a data centre mean the trend unlikely to end any time soon. “It is becoming clear that the reason for the trend is the overall economics driving cable projects to data centres. With subsea cables terminating in a data centre where customers reside, they don’t have to pay for backhaul costs to connect to a subsea cable and landing station.” The new year is set to be just as eventful for Globalinx. It plans areto complete its phase one, two and three data centres in the first quarter. The company will play a key role in the 2019 Hampton Roads regional broadband initiative, for which Globalinx’s data centre and cable landing station campus will act as a connection point for the regional fibre ring.

42 |

Google Cloud is just getting

started With Google’s Dunant cable due to be RFS by 2020, Michael Francois, technology lead manager of global network infrastructure, EMEA at Google Cloud, talks to Natalie Bannerman about the increasing data Capacity demands that made the cable possible

ontent cables are changing the landscape of the submarine cable world. The increasing need for costeffective bandwidth is changing the paradigm of traditional consortium cables as over-the-top (OTT) providers move away from being buyers to owners of capacity. One of the key players in that space is Google. Since 2010 the global technology company has invested in 12 subsea cable projects, some privately and others as part of a consortium. Google’s most recently announced project, soon to bring the total to 13, is its privately-owned Dunant cable connecting France to the US. The new system, due to be completed in late 2020, will enable the company to better serve its users and customers by increasing bandwidth. Michael Francois, Google Cloud’s technology lead manager for global network infrastructure, EMEA, says that the decision to build this route was driven by growing user traffic across the Atlantic, as well as the need for reduced latency. “Our users have traffic that needs to

cross the Atlantic, and after a careful analysis of existing and planned systems, we chose the Atlantic coast of France and Virginia in the US as the landing points for this specific system,” he says. “This provides diversity of landing points, and provides reduced latency and increased resiliency to the Google Cloud network.” Francois says that choosing to land specifically in Virginia and on the French Atlantic coast over other US and European hubs, gives Google Cloud the much needed route diversity and close proximity to its existing data centre and backhaul infrastructure. Overall, the plans involved a lengthy and detailed process that weighed up such factors as environmental considerations, fishing activities, government established cable protection zones, the type of undersea terrain near shore and the availability of diverse terrestrial fibre networks from the cable landing to locations that are more inland, like Paris or Berlin. “Google needs to build a robust, low latency network to meet the requirements

of all types of users,” explains Francois. “Getting these cables closer to our data centre and cloud regions improves the experience for the end user. It is also important to diversify the landing locations, to increase overall network availability.” Though no capacity or specific latency details have been given about the much-talked-about 6,600km cable system Francois assures me that it is “right-sized and deeply scalable”. He adds: “The higher network resiliency provided by private cables impacts our customers in a positive way, and we will continue to build cables to ensure the right capacity is in the right place at the right time.” To Francois, the fact that cable systems are increasingly connecting directly into the data centre is simply a natural progression brought on by connectivity needs of the users of the cable systems. Despite this, he says that power-feeding equipment (PFE) will continue to sit close to shore in the cable landing station (CLS), “but to meet the needs of users we need to be more efficient, and bring the terminating december/january 2019

the big interview: michael francois | 43

2000

Vice president, network engineering, Epoch Internet

2002

Vice president, network planning, Netifice Communications

2006

Vice president, network planning, MegaPath

2011

Global network infrastructure partnerships – APAC and Australia, Google

2018

Technology lead manager, global network infrastructure – EMEA, Google Cloud

construction regulations. And while TE SubCom may have beat the competition this time, Francois says that Google works with all of the suppliers to the submarine industry. “Each cable is designed to meet our unique requirements around capacity, geography, wet plant capabilities, etc,” says Francois. “Each decision takes into account factors such as our capacity requirements, vendor experience in different oceans, knowledge of shore approaches, marine maintenance, repeater spacing and the like. We will continue to select the best supplier that is able to meet the specific timing, route and engineering requirements we have.” Cable builders aren’t the only partnerships that Google is forging. It recently confirmed that is working with Orange as the Dunant cable landing partner in France. Under the terms of the agreement Orange will build and operate the landing station on the French Atlantic coast and provide backhaul service to Paris. In turn, Orange will benefit from fibre-pairs with a capacity of more than

Our charts scale, just as our submarine Capacity capacity does”

Michael Francois, technology lead manager of global network infrastructure, EMEA, Google Cloud

equipment close to the same locations where interconnections occur to metro networks and traffic exchange points”. As for the Dunant cable, it will terminate at a CLS, but the final location of line terminating equipment has yet to be decided. Despite the fact that Dunant is a private system, Google is honouring the longstanding industry tradition of allowing customers to exchange capacity for a stronger communications offering. “As part of that effort, we have been happy to honour a tradition in the submarine industry where people who have capacity on similar routes exchange capacity or fibre pairs between systems to strengthen the communications network lattice between continents for all involved,” he explains. At the time of the announcement, TE SubCom was named as the designer and manufacturer of the four-fibre pair cable system. The company says that Dunant will be built using SubCom’s A1 cable family, which is optimised for projects compatible with higher design and capacitymedia.com

30Tbps per pair, enabling Orange to boost its capacity to meet growing data and content demands between Europe and the US. And its these very French assets that make Orange the ideal French partner. “Orange has unique assets and capabilities that accelerate the development of the Dunant cable, and in return we are able to make sure that all of our combined users and customers have access to deeply scalable infrastructure which will serve their needs,” says Francois. “Orange has a long history and many capabilities in this sphere. Knowledge, experience and shared objectives are a good basis for successful collaboration.” As the relationship between telcos and OTTs continue to change, Google maintains that it has a strong relationship with the industry as a whole and collaboration with Orange is a good illustration of that. “We enjoy working with telcos on everything from submarine cables to Android handsets, from e-commerce enablement to cloud computing partnerships.” In the official blog post announcing the new cable back in July, it is mentioned that the new system will allow Google Cloud to

“plan for their business in the future”. When questioned on what this means, Francois explains that modern systems deliver scalable capacity allowing the company to serve long-term traffic demands and to connect any additional data centre they may build. “We often hear about how internet traffic growth is ‘off the chart’, but at Google we know that our charts scale, just as our submarine capacity does,” he replies. One particular region that is on the lips of most infrastructure providers is Asia and the incoming surge of data that it’s creating. Google is also seeing this trend and has already started preparing for it. Earlier in 2018 the company announced plans to expanded Google Cloud to Hong Kong and Indonesia, adding to its existing locations in in Japan, Taiwan, Australia and Singapore. He says Google foresees continued demand in Asia driving the need for more cables. “Google has spent $30 billion improving our infrastructure over the last three years, and we’re not done yet.” It comes as no surprise that Google is at the forefront of emerging technologies like 5G and the internet of things (IoT) and planning for the effect that more connected things will have on its networks, particularly as a manufacturer of devices themselves. “Every ‘thing’ that gets attached to the internet increases the need for infrastructure, whether it is a Nest Thermostat or a Google Home Smart Speaker. Technologies like 5G will allow for the bandwidth for applications that brilliant engineers are developing all over the world,” explains Francois. Interestingly he describes the role of applications and devices as picking up where content and data traffic has left off, but ultimately bringing everything closer to the end user. “YouTube and other video traffic has always been a driver for increased infrastructure spend, and new applications and devices will continue that trend. IoT will push the edges of the network farther and closer to users wherever they are. “ It’s foolish to assume Google Cloud is any one thing, operating in any one sector. The company has seen “tremendous growth in all areas”, says Francois. It has the world’s largest and most interconnected network, and it is “growing every day”. It has and will continue to invest in cloud regions and zones all over the world, with planned developments already on the way. In addition, it will continue to build on features and products, many of which were initially developed as solutions for search, YouTube, Android, Google Maps, Gmail and other products. Is this the last of Google’s cable investments? Unlikely, Francois says. “We’re just getting started.”

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feature: women in subsea | 45

Saving subsea through

diversity THE SUBMARINE CABLE INDUSTRY, MUCHCapacity LIKE TELECOMMUNICATIONS AS A WHOLE, IS Ç§

Ç¤

ÇĄ STALLED INNOVATION AND COMPETITIVE ADVANTAGES ARE FORCING TELCOS TO PAY ATTENTION

he lack of statistics that exist around women in subsea is shocking. For this very feature my search took me to the very depths on the worldwide web, tapping up numerous resources via LinkedIn and email and I still came up with nothing. Through my own grassroots style of investigating, I scrolled through the websites of the some of the biggest players in subsea to inspect their management pages in hopes of seeing a strong female presence. Of the six companies I surveyed not one had more than 30% of its management team led by women. The highest of them had five of its leadership positions held by women, out of a possible 18 (27.78%). The lowest had just one. And two had no women on management teams at all. As the industry at large is facing a skills crisis, these are issues that need to be addressed.

A new initiative This yearâ&#x20AC;&#x2122;s second annual Subsea Americas event, which is taking place in Fort Lauderdale, will see the launch of a brand new initiative called Women in Subsea. Led by Naaz Bax, events manager at Seaborn Networks, and Amy Marks, CEO of XSite Modular, the pre-event Â&#x2026;Â&#x192;Â&#x2019;Â&#x192;Â&#x2026;Â&#x2039;Â&#x2013;Â&#x203A;Â?Â&#x2021;Â&#x2020;Â&#x2039;Â&#x192;Ç¤Â&#x2026;Â&#x2018;Â?

session will offer networking opportunities, advice and workshops for women working in the sector. Commenting on what inspired the initiative, Bax explains: â&#x20AC;&#x153;While the absolute number of women working within the sector is still small, it is growing. We want to provide a platform for these women to come together, mentor and support one another.â&#x20AC;? â&#x20AC;&#x153;Though I see groups at large promoting things around women in telco in general, I didnâ&#x20AC;&#x2122;t see anything that spoke to women in subsea specifically,â&#x20AC;? adds Marks. Though the timing of the initiative aligned itself well with Subsea Americas, Marks says itâ&#x20AC;&#x2122;s more the tone of the industry at the moment, that makes this so greatly needed. In her view, the sector is at a crossroads. â&#x20AC;&#x153;I think some of the big players are recognising that thereâ&#x20AC;&#x2122;s an actual skills gap right now. Much of the talent has moved on or retired and itâ&#x20AC;&#x2122;s very homogenous,â&#x20AC;? she explains. Debbie Brask, vice president of project management at SubCom agrees, saying that the size of the sector will mean the shift toward diversity will happen over time. â&#x20AC;&#x153;The undersea cable industry is a very

small population and in my opinion, given the longevity of the workforce in this industry, the trend toward diversity will be more gradual,â&#x20AC;? she explains. Speaking to other prominent women in the sector, the consensus is that subsea is no different from telecoms as a whole. This has improved over time, but the industry still needs to figure out a way to attract more women, to develop them and to retain them in both commercial and technical roles. Over at Ciena, Alice Shelton - senior consultant of global submarine sales - says that â&#x20AC;&#x153;diverse workforces are more than just â&#x20AC;&#x2DC;the right thing to doâ&#x20AC;&#x2122;, they are a business imperativeâ&#x20AC;?. Sheltonâ&#x20AC;&#x2122;s sentiment is echoed by XSite Modularâ&#x20AC;&#x2122;s Marks who wants to make it clear that itâ&#x20AC;&#x2122;s not a women versus men issue, itâ&#x20AC;&#x2122;s a business issue that needs to be taken seriously. â&#x20AC;&#x153;This is not about feminism,â&#x20AC;? she says. â&#x20AC;&#x153;This is not about wanting our place at the table - this is about money, capitalism, competitive advantage and saving this industry.â&#x20AC;? According to a 2017 report by McKinsey & Company, entitled Delivering Through Diversity, it indicates that those organisations with greater gender diversity outperform those that donâ&#x20AC;&#x2122;t by 21%.

46 | feature: women in subsea

“You’d have to live under a rock on the planet to not understand that bringing in diverse viewpoints in leadership, is going to help you grow your business exponentially and become more innovative,” continues Marks. According to Brask, the solution could start by having “industry experts provide an overview to many key engineering universities and review engineering opportunities in the undersea telecoms market”. Overall, she says it’s about “setting precedents and ensuring representation at all levels”. Bax adds that it would be good if companies would “commit, the way Seaborn and XSite have, to making sure this initiative has traction, then we would be off to a good start”. But its not all doom and gloom, the industry has come a long way in recent years. Shelton says “it’s promising to see that there are more initiatives being established to encourage girls and young women to look at pursuing careers in science and engineering”.

What is the biggest piece of advice from these leading ladies? Go where your passion is, specialise in it and do it with confidence. “Find something you are interested in, research it and the companies that work within that area,“ says Bax. “Define your speciality,” adds Marks. “Become an expert in something no matter how small or niche it is. Take it, claim it and own it as yours.” But don’t let this conversation fool you. Though promoting women into more

gap,” she says. What’s the solution? Attract more young people into the telecoms space. “We have to empower them to bring more technology into our business, to bring other thought processes into our business, to be trained and have the tools to help them define their role within this industry,” explains Marks. And Brask agrees, adding: “There needs to be targeted marketing and recruiting to educate new talent on the subsea market and how they can fit in to drive solutions and new products to keep up with worldwide bandwidth needs”. “These content players are perfect benchmark companies to learn how to attract this younger talent - most for example have supplier diversity programmes,” contiues Marks. “Why are we not looking at some of the biggest OTTs on the market right now and figuring out how to bring some of that into our industry?”

This is not about feminism, this is not about wanting our place at the table - this is about money and saving this industry” Amy Marks, CEO, XSite Modular

subsea roles appears to be the answer on all fronts Marks thinks there’s a bigger issue at Capacity play here. “You can have women and men, and we could all be aging out and the industry is still going to die out because of the skills

Young people The new initiative is to feature a segment on ‘claiming your own path’ something, which first sounded akin to a self-help workshop but after speaking to the two co-chairs feels a lot more grounded in women taking responsibility and ownership in their work. “I think we have to take stock on what we want to accomplish personally and find a path in which to do that. If you’re a woman who’s been in this industry and has some experience here, this is your time,” says Marks. Both Marks and Bax want attendees of the initiative to walk away with more than just good time but the start of a long-term group that can grow and evolve over time, with real practical benefits. “We’re not just trying to motivate and educate the men and women who want to attend; we really want to make this a resource mining event,” Marks says. For Bax however, it’s a little more personal. “I think there is an underlying belief that sometimes women can be hardest on other women,” she says. “We want to see that myth erased within the subsea industry and to make our messaging loud and clear that we are here to support one another.”

Market Overview Aside from the issues surrounding the work skills gap, the industry as a whole is in transition adjusting not only to the presence of OTTs but ever-increasing data demands, much needed route diversity and aging cables to name a few. Speaking to these female thought leaders, it is clear that the entire sector is in flux. Perhaps this preoccupation is the reason why these other concerns aren’t being properly prioritised? “The biggest trends in the subsea industry are the bandwidth needs of our customers – either the content providers or key Tier 1 carriers,” says Brask. She believes that the underlying need for bandwidth is the direct result of the growing use of video streaming applications, as well as the industry’s push into new technologies such as augmented and virtual reality as well as ultra-high definition, which all require large amounts of bandwidth for live streaming. “As these technologies move mainstream,

demand for bandwidth will only continue to grow, driven by the needs of individuals making use of this technology,” she adds. Shelton is somewhat different working for a networking solutions provider. Because more cable operators are increasing their bandwidth capacity to leverage more business opportunities and offer more services, she sees a demand for softwaredriven solution “We’re seeing a lot of demand for software-defined packet-optical technologies, which enable massive scaling, optimisation, analytics and automation through network intelligence,” she explains. “We’re also having a lot of conversations about the need to create more adaptive networks, which harness data and automation capabilities to monitor and reroute traffic in the case of potential cable failures. A big part of this involves bringing machine learning and AI into the networking sector.”

december/january 2019

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48 | SPONSORED STATEMENT

DISTRIBUTED ACOUSTIC SENSING FOR SUBMARINE TELECOMS SYSTEMS Fiber sensing is everywhere!

techniques have emerged. DAS (Distributed Acoustic Sensing) Over the past decades, fiber has virtually become the only channel is a measurement technique based on fiber sensitivity to of transmission for fixed communications. It first appeared on the mechanical disturbances, such as vibrations or pressure variations. longest segments of underwater and terrestrial It effectively turns every single piece of fiber into a potential telecommunications networks, and now fiber reaches every office, vibration or acoustic sensor. every home, installed along highways, railways, power lines and With the widespread deployment of fibers on infrastructures, pipelines. All networks are now embedding fiber as a standard. DAS has thus become a common monitoring tool in many areas. Fiber is now everywhere! In the rail industry, DAS can be used to detect the location of the Oil & Gas offshore fields are no exception to the rule. Most trains and monitor rolling stock conditions. In the oil industry, of the new offshore platforms coming into operation use fiber DAS is used for terrestrial pipeline monitoring to detect, locate or for communication with their shore base and their subsea Capacity identify nearby activities and potential threats such as unplanned production systems. digging works or intrusion attempts. Early warnings provided by In parallel to this massive development driven by increasing DAS allows the operator to immediately trigger preventive actions bandwidth requirements, a number of fiber-based measurement before damage occurs.

From pipeline monitoring to submarine cable monitoring DAS interrogators used for pipeline monitoring have a typical reach of 40 km. Multiple interrogators are installed as required along the pipeline route to cover the desired length when longer than 40 km. During the commissioning phase after installation, as a calibration, typical threats (such as excavating) can be simulated at various locations along the pipeline and a database of signatures can then be recorded for future comparison when the system is in service. Pipelines are much more expensive assets than submarine telecommunication systems, but when we consider the importance of the data they carry we could say that they are equally worth protecting. In principle, a DAS interrogator can simply be connected to a submarine cable, assuming a dark fiber is available

capacity

for monitoring. However, the submarine environment calls for specific requirements for submarine cable DAS interrogators: • longer range; the interrogator should be able to cover the entire length of the cable that is the most likely to be damaged, e.g. the shallow water section. In many cases, this will exceed 40 km; • higher sensitivity; the interrogator should be able to detect a threat approaching the cable early enough to have a sufficient response time for corrective actions (for example, contact with the approaching vessel); • calibration free; given the difficulty and cost to access an installed submarine cable, it should be possible to classify threats without prior calibration during commissioning. december/january 2019

| 49

ASN DAS interrogator ASN has recently launched the development of a DAS interrogator dedicated to the protection of submarine telecommunication cables. This interrogator uses an innovative interrogation technique, which provides a significantly improved signal to noise ratio and a high-fidelity measurement of the fiber mechanical constraints. Several tests were conducted to evaluate the performance of the developed prototype in real cases and the most significant results are presented in the section below. A simple dropped object test was first performed to demonstrate the ability of the system to detect the tiniest mechanical disturbances on a submarine cable; the interrogator was connected to a standard armored and sheathed subsea cable and a pencil of a few grams was dropped from 10 cm height at a distance of 120km; the corresponding signal was clearly detected by the interrogator with a resolution of less than 10 meters.

Another test was performed to assess the capability of the DAS interrogator to detect the acoustic signature of activities near the cable. For this purpose, hydrophones were positioned along the cable as references. The DAS signal was recorded as a passenger boat crossed the cable. The frequency spectrum of this signal is shown in figure B. The acoustic signature of the vessel appears clearly (characterized by frequency rays). The same signature had been recorded with the reference hydrophones, as shown in figure D.

These last two experiments confirmed the potential of the DAS interrogator to not only detect activities near a submarine Tests at sea have also been performed; a standard ASN OALC5 cable but also, thanks to spectrum analysis, to classify them Capacity LW cable was installed in an area with strong currents and regular without prior calibration. maritime traffic. Further enhancements on signal processing should make The figure below represents the bathymetric profile of the it possible to identify the signatures of various threats which installation area in the shore section. submarine cables might be exposed to: seabed movements (earthquake, landslides), currents, seabed intrusive activities (trawling, anchoring). Other sea trials are currently in progress on several systems to gather additional data for this purpose. Those trials will also provide further indication regarding sensitivity to seabed intrusive activity near the cable and subsequently the time available to send alarms when such activity is detected. A first test was performed to highlight the ability of the system to detect the vibrations induced by currents. The acoustic spectrum of the DAS signal (between 3Hz and 1kHz) was recorded at 2 separate times of the day.

Conclusion

Technology now exists to detect mechanical disturbances on standard telecommunication fiber optic cables. There is no need for special fibers inside the cable, just an available dark fiber will make an excellent sensor.

The left figure above shows the DAS signal recorded one hour after low tide; some currents are present and vibrations (characterized by a wide band low frequency spectrum) are detected at position 500m (1 channel corresponds to 10m). The right figure shows the DAS signal recorded three hours after low tide, when currents are expected to be stronger. The vibrations at position 500m are stronger and other vibrations appear at position 1500m with the same frequency pattern â&#x20AC;&#x201C; wide band low frequency. capacitymedia.com

The DAS interrogator developed by ASN provides long reach and superior sensitivity which makes it particularly adequate to monitor the whole section where the submarine cables are particularly vulnerable and where statistically most cable cuts occur. In addition, the signals generated by the interrogator make it possible to classify the threats to the cable integrity (vibrations, seabed intrusive activity, etc.) without prior calibration. Such DAS equipment could be coupled with AIS message transmitter systems which can alert mariners in real time when issues arise. Corrective actions can then be taken before an incident happens.

50|

Connecting theWorld MAREA

Dunant

Owner: Facebook, Microsoft, Telxius

Owner: Google Cloud Length: 6,600km

Length: 6,600km

Built by: TE SubCom

Capacity: Unknown

Capacity: 160Tbps

Capacity

Quintillion Owner: Quintillion Length: 15,000km Built by: Quintillion Capacity: Unknown

Deep Blue Owner: Deep Blue Cable

*Map routes have been stylised and are not drwan to scale.

Length: 12,000km Built by: TE SubCom Capacity: 160Tbps

SACS

SAEx 1

Owner: Angola Cables

Owner: SAEx International

Length: 6,165km

Length: 14,720km

Built by: NEC

Built by: ASN

Capacity: 40Tbps

Capacity: 72Tbps

december/january 2019

map: subsea cables | 51

AN ESTIMATED 98% OF THE WORLDâ&#x20AC;&#x2122;S INTERNET TRAFFIC IS CARRIED VIA SUBMARINE CABLE SYSTEMS. AS SUCH, THIS CRITICAL PIECE OF COMMUNICATIONS INFRASTRUCTURE REQUIRES HUNDREDS OF MILLIONS IN INVESTMENT, SPECIALIST KNOWLEDGE IN ITS CONSTRUCTION AND OPERATION, ENVIRONMENTAL COMPLIANCE, AS WELL AS A HOST OF OTHER CONDITIONS. THE DEVELOPMENT OF THESE SYSTEMS IS NO SMALL TASK, SO CAPACITY Í&#x2122;Í&#x161; Ç§ CONTINUE TO KEEP US ALL CONNECTED.

AEC-2/HAVFRUE

SEA-ME-WE 5

Owner: Aqua Comms, Bulk Infrastructure, Facebook, Google

Owner: Consortium* Length: 20,000km

Length: 7,200km Built by: TE SubCom

Built by: Alcatel-Lucent and NEC

Capacity: 108Tbps

Capacity: 24Tbps *BSCCL, China Mobile, China Telecom, China Unicom, Djibouti Telecom, du, MPT, Ooredoo, Orange, Saudi Telecom, SingTel, Sri Lanka Telecom, Telecom Egypt, Telecom Italia Sparkle, Telekom Malaysia, TeleYemen, Telkom Indonesia, TransWorld Associates, Turk Telekom International

Capacity

ASC Owner: Vocus Communications Length: 4,600km Built by: ASN Capacity: 40Tbps

Hawaiki

MainOne

PEACE

Owner: MainOne

Owner: Hengtong Group

Owner: Hawaiki Cable Company

Length: 7,000km

Length: 12,000km

Length: 15,000km

Built by: TE SubCom

Built by: Huawei Marine

Built by: TE SubCom

Capacity: 1.92Tbps

Capacity: 60Tbps

Capacity: 67Tbps

capacitymedia.com

52 |

From the

Cable grave to the

WITH A NUMBER OF OLDER SUBMARINE CABLE SYSTEMS APPROACHING THE END OF THEIR USEFUL LIFE, THE MARKET FOR SUBSEA CAPACITY MAY BE ENTERING A NEW PHASE. GUY MATTHEWS INVESTIGATES

new generation of subsea cables is shaking up the business of international capacity. Typical of the trend is the recently launched MAREA system, a behemoth that runs across the Atlantic from Virginia Beach to Bilbao. Backed by Microsoft, Facebook and Telxius, MAREA operates at a whopping 160 terabits of data per second, enough to stream 71 million high-definition videos simultaneously. It’s a trend that is mirrored in the Pacific. Scheduled for launch in Q2 2019, the Pacific Light Cable Network (PLCN) will connect Hong Kong directly with the US for the first time and with its 144Tbps of capacity over six fibre pairs will offer 20 milliseconds less latency than its nearest rival. Facebook and Google are backers. Each major new cable launch raises questions about the future of the older fibre infrastructure still in service on routes around the world. Many cables built in the late 1990s and early 2000s, an era of much more modest bandwidth needs, are still in active service. Take for example SEA-ME-WE 3, launched in 2000 with a design capacity of 0.02Tbps and upgraded several times to a current capacity of 4.6Tbps, a fraction of the contemporary norm. Do it and others like it have a future? Alan Mauldin, research director with analyst firm TeleGeography, believes the fact must be faced that a number of older systems are poised on the brink of

Capacity extinction. “Cables are engineered to have a minimum design life of 25 years,” he says. “But what really matters is their economic life. This depends on a cable’s revenue exceeding its costs. If the costs of operating a cable continually exceed the revenues, then it could be time to say goodbye.” Mauldin says that many factors can influence a cable’s economic life and therefore its fate – price erosion on the route in question, changes in demand patterns, the cost of an upgrade or a repair, which might be higher on an older cable than on a newer one, not to mention the obvious element of increased competition from other cables. He divides the cable extinction process into distinct phases: “There are ‘zombie cables’, where the cable remains operational, but not actively selling capacity or engaging in additional upgrades,” he says. “Then there’s ‘dismembered cables’ in partial retirement, where only specific spans or branches are decommissioned, for example Americas-I, Columbus-II or CANTAT-3.” He adds: “You have ‘death row cables’ where the maintenance contract is cancelled, but it remains in service until the next fault. And ‘dead cables’ where there is full decommissioning.” Leigh Frame, COO of vendor Xtera, believes there are further nuances that affect a cable’s viability: “Take a cable like Apollo [launched on the Atlantic route in 2003], where there’s very little

commercial activity visible in the marketplace, but it’s already sold and is in use with a mix of OTTs and carriers,” he argues. “The individual fibre owners will continue to upgrade their pair, and I would expect Apollo to stay in service for a few more years yet. By some definitions it would be at the end of its economic life, but that’s not really the case.” He points out that there are customers of Apollo, and other cables like it, that are sitting on an IRU that guarantees the cable to be in service to a definite date. “There are restrictions in various forms to the decommissioning of some of these older cables,” he points out. The true divide between older and newer cables lies more, argues Frame, in the make-up of their backers and their intended purpose. He suggests that there is a rough breakpoint, about six or seven years old, before which cables were generally carrier-led, consortium-style affairs: “After that point they begin to be catalysed or indeed entirely paid for by OTTs that have no intention of catering for operator customer needs,” he says. “In other words newer cables like MAREA really aren’t being built as replacements for older cables. They go to different places, because their aim is to connect data centres.” OTTs are clearly approaching the business of subsea building with their own priorities, and in the main are spending in order to minimise cost per bit. A cable, to an OTT, represents a december/january 2019

Image: Adobe Stock

feature: subsea cables | 53

necessary cost with no value other than as a means to connect particular end points. The newer wave of systems tend, in consequence, to be point to point affairs with few or no branches. With OTT-led cables so confined in their purpose, is there really such a strong case for switching off cables for which there is no commercial replacement? Xtera’s Frame perceives that the subsea sector is seeing a steady whittling down of available wholesale capacity as OTTs steal the lunch of the traditional operators and change the nature of the industry. “This is certainly becoming the case on the thicker routes, but not always on thinner, more specialist, more regional routes where there is still some speculative building,” he concludes. Mattias Fridström is chief evangelist for Telia Carrier, operator of a number of Nordic cables. He agrees that, away from Pacific and Atlantic hotspots, there is much more granularity surrounding the fate of older systems. “For example, a couple of years ago we had a situation where one of the cables

between Sweden and Finland had been damaged in a couple of places. It was discovered that a significant length of the cable had deteriorated due to long term attrition with the rocky seabed,” he says. “Since the system was 18 years old, questions were raised about the economic viability of repairing sections of the cable as opposed to replacing the entire system itself. However, a test of all fibres indicated that they were still in perfect condition and a decision was taken to replace a 30km segment of the cable in the archipelago, with the intention of extending the lifespan by at least 10 years. Time will tell if this was a wise decision or not, but so far, so good.” It is also the case that in much poorer parts of the world than the Nordic region, governments will be less willing to sanction the switching off of old cables that are still a valued part of the local economy. Set against the motives for extending the lives of old cables still further is the reality of what the science of upgrading will allow. The remarkable achievements of equipment vendors in boosting

capacity that have been seen over the past decade cannot, arguably, go on for ever. “We are seeing the gains slowing, in terms of upgradeabilty for old cables,” says TeleGeography’s Mauldin. “But bear in mind we are talking about cables designed to carry 2.5G or 10G waves that can now carry 100G, so the improvement has been incredible.” There need not be cause for gloom, he argues. “Better just to recognise that a new species of cable is emerging as dinosaur cables begin to go extinct,” he says. “Between 2018 and 2020, cables worth an estimated $8.8 billion are expected to enter service. These cables have higher fibre-pair counts and provide greater diversity of landing points than older systems.” The global network of submarine cables is evolving. Some old cables will prove obsolete, but no single rule exists for this termination process. Every cable will need to be looked at individually on its merits to see whether it is technically upgradeable as well as economically and politically worthwhile.

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54 |

AQUA COMMS: BRINGING A NEW UNIQUE FOCUS TO THE SUBSEA MARKET AQUA COMMS HAS BEEN VERY BUSY BEHIND THE SCENES AND IS SET TO EXPLODE

Í&#x161;Í&#x2DC;Í&#x2122;ÍĄÇ¤ Ç§ NIGEL BAYLIFF, CEO, CHRIS BAYLY, CCO, AND ANDY HUDSON, CNO, ABOUT THE EXCITING PLANS AFOOT FOR THE UNIQUE SUBSEA CARRIERSâ&#x20AC;&#x2122; CARRIER NEXT YEAR

Capacity

s I speak to Bayliff, who joined the company in October 2016, I am reminded just how far Aqua Comms has come over the past two years. â&#x20AC;&#x153;At that stage the company had just built a cable and had not necessarily created a monetisation strategy or a longer-term development strategy,â&#x20AC;? he tells me. Nigel Bayliff, CEO Aqua Comms is a refocused business today and has undergone a lot of change to position itself as one of the leading players in the subsea market. The company has a solid infrastructure-based style investor base, which includes the private fund of a high net worth individual, the Irish Governmentâ&#x20AC;&#x2122;s strategic infrastructure fund, and also New York-based private equity power house Cartesian Capital. â&#x20AC;&#x153;We have a good stable investment house, weâ&#x20AC;&#x2122;ve monetised our cable, brought in a management team that was able to not just build cables but operate cables,â&#x20AC;? Bayliff tells me. Aqua Comms is bringing the facilities of its cables to the market in a very carrier-neutral independent professional and dedicated way and, as the CEO alludes to, the new management team that has been added to the company has positioned Aqua Comms for exponential growth which the industry will certainly take note of. With the new management team in place, I ask Bayliff how that is coming into play now. 2017 saw Andy Hudson and Kevin Foley join the company as chief network officer and chief financial officer respectively, bringing with them â&#x20AC;&#x153;considerable experience in a whole range of different areas in infrastructure and telecommunications services overseasâ&#x20AC;?. They are

internationally experienced and very rounded members of the team, which was further boosted with the addition of former director of global wholesale solutions at Colt, Chris Bayly, just before ITW in May 2018.

Fibre-Optic Cables Under The Sea (FOCUS) Aqua Comms has a new â&#x20AC;&#x2DC;FOCUSâ&#x20AC;&#x2122;, a term it is not only using as the name for its own customer newsletter but is embedded in the companyâ&#x20AC;&#x2122;s strategy. The message is clear: Aqua Comms is a specialist in that is only focused on subsea networks and the North Atlantic market. Bayliff states: â&#x20AC;&#x153;We are very focused on this very specific layer of the whole telecommunications industry, which is: undersea, carrier-to-carrier, independent, carrierneutral, large bandwidth, and transport services.â&#x20AC;? As the company builds and owns its own networks it allows rapid service delivery in as little as 24 hours. Aqua Comms is the only operator in the market that offers such an approach, and that this transparency and clarity of approach allows its customers to outsource their trans-Atlantic network needs to Aqua Comms with the comfort of knowing that this is all it does and that it does this as a carriersâ&#x20AC;&#x2122; carrier. â&#x20AC;&#x153;We donâ&#x20AC;&#x2122;t do IP, weâ&#x20AC;&#x2122;re not an Internet Exchange, we havenâ&#x20AC;&#x2122;t got all of the focus and customer service layers to sell directly sophisticated products to enterprises. What we do is carry the large pipes across oceans and the ocean that we have chosen to specialise in first is the Atlantic,â&#x20AC;? adds Bayliff. Carriers are all now focusing on their own core strengths, whether that be services for enterprises, terrestrial distribution, or mobile, but the important factor here is that none of them are specialists in subsea cable development, building and operating like Aqua Comms, which is why it is increasingly becoming a firm carriersâ&#x20AC;&#x2122; favourite. It might sound like a limiting factor, but this specific focus brings optimisation and efficiency. december/january 2019

feature: aqua comms | 55

1Tb of new business in just a few months After speaking with Bayliff, I’m provided with a comprehensive update from the CCO on how business on Aqua Comms’ existing network assets is progressing. “We’ve had a very successful year winning new business and from our perspective it’s looking at that in the context of growth that’s naturally there in the Chris Bayly, CCO marketplace but also taking our share of existing services that were historically on competitive cables, typically the legacy cables,” Bayly says. “In the past few months we’ve closed 1Tb of new orders in support of that view.” This, I’m informed is part existing traffic being migrated and part growth. Aqua Comms is seeing great success of high bandwidth operators migrating to the new Atlantic cables to future-proof their networks. This is very much linked to the evolution of the marketplace that legacy systems deteriorating are no longer hypothetical but are quickly becoming reality. “There is a gathering pace of expectation that some of the legacy systems will be retired in the very near future and therefore they look to work with the new systems,” he adds. Network diversity is truly driving new cable system builds

2019: AEC-2, CC-2, NSC & the North Atlantic Loop

Aqua Comms is continuing its investment in subsea cables by joining the HAVFRUE consortium to create the ‘North Atlantic Loop’ and AEC-2. AEC-2 will be ready for service at the end of next year. AEC-2 complements and enhances the AEC-1 network to create a resilient, ring-based infrastructure providing the highest Andy Hudson, CNO availability between the East Coast of the US, Ireland, and Northern Europe, connecting the hubs of the pan-Atlantic hyperscale data centre industry in North America, Ireland and Scandinavia. 2019 is set to propel the company to even higher heights, says Andy Hudson, focusing on the company’s AEC-2, CC-2 and North Atlantic Loop projects. “AEC-2 is our internal name for the connection between the New Jersey Fiber Exchange (NJFX) all across the Atlantic to Denmark, which is the main system and there’s a branching unit just off the west coast of Ireland that leads into Ireland,” the chief network officer explains. “It’s fully surveyed and we are in factory acceptance testing for some of the elements of the project right now.” Aqua Comms is responsible for not only being part of a consortium but for the entire system, as the landing party for the entire system of AEC-2 and also as the operator. “We’re responsible for the fronthauls, where the cable lands on the beach all the way to Capacity the cable landing stations,” Hudson says. “We’re responsible also for everything such as permitting, planning, surveying, any acquisitions, all negotiations, design, and any build activity. Joining all the dots is an Aqua Comms responsibility.” AEC-2 is due to go live in Q4 2019 and Hudson informs me that everything is on track to deliver this. CeltixConnect-2 Chris Bayly, CCO, Aqua Comms (CC-2), a system from the north of Dublin across the Irish Sea with two landings picking up the Isle of Man, and the North Sea Connect (NSC) build, which is part of the North Atlantic Loop today, particularly by the OTTs. Historically it was more linking Denmark to Newcastle, are both set to go live in Q1 single-threaded with a cables going from New York to Cornwall, but the network diversity that is designed into networks today has 2019. “North Sea Connect is around 90% surveyed and the cable is in manufacturing right now and CC-2 across the Irish Sea is evolved. “Just take a look at what we’re doing with the North around 50% surveyed,” adds Hudson. Atlantic Loop where we have diverse landings in the US, Ireland The diversity in the Irish and North Seas, alongside the transit and Demark,” Bayly explains. “That was less visible 15-20 years route from Blackpool to Newcastle, will improve latency ago when the other systems were built. Today, you’re now seeing that being complemented with other new systems being built and tremendously and as the landing party for the entire infrastructure, Aqua Comms will be responsible for nine landings referenced to they’re all diverse to each other. All of that has helped to drive North Atlantic Loop in 2019. It will offer capacity services, managed some very strong success on AEC-1.” spectrum, fibre pair solutions & professional services throughout its AEC-1, which came into service in early 2016, is at the core of network. The company’s services across multiple systems will offer Aqua Comms’ business and provides secure, low latency, true diversity and it can provide these services on a single system high-quality trans-Atlantic connectivity from New York to The past year was a true success story for Aqua Comms, but Ireland. The 5,526km route adds diverse backhaul fibre to 2019 is where all its hard work and investments will come to additional PoPs in the US, Ireland and the UK. AEC-1 along fruition and propel the carriers’ carrier above the competition. with CeltixConnect-1, a 131km long cable system with 72 fibre Watch this space! pairs, are still delivering strongly for Aqua Comms. “Strategically we’re working with partners to try and deliver end-to-end services with 1Gbps, 10Gbps through to 100Gbps. We structure that through partners to ensure that we stick to our focused message of being a carrier’s carrier but that we aim to be best-in-class from sales to service delivery, focused on the subsea segment at high bandwidth level and only at the transport layer.” That keeps it simple but very effective, Bayly states. Alongside AEC-1, the emergence of AEC-2 will mean Aqua Comms will have two completely independent routes that can deliver Northern Europe to Ireland to the US in huge capacities, much more than any fibre cable in the preceding 20 years and to independently supply that to every carrier.

Strategically we’re working with partners to try and deliver end-to-end services with 1Gbps, 10Gbps through to 100Gbps”

capacitymedia.com

56 |

PEACE Cable

The carrier’s cable Xiaohua Sun, COO of PEACE Cable, discusses how the 12,000km system will connect three continents, offering the lowest possible latency, and how the company is forging new partnerships and Capacity developing an open cable system

panning Asia, Africa and Europe, the Pakistan and East Africa Connecting Europe (PEACE) Cable is the latest in long line of subsea cables crossing that East-West divide. The 12,000km system is privately owned by Hengtong Group, offering carrierneutral services to its customers, across the shortest direct route connectivity. The self-proclaimed carrier’s carrier cable is, according to PEACE Cable COO Xiaohua Sun, well placed to serve incumbents as well as OTTs, meaning the entry of such content players is not a threat to the new system. As with all new cable systems popping up around the globe increasing capacity and upgraded technologies are important but it’s the route diversity, and the ability to connect underserved markets, that seem to be top of the list for many a new cable. Sun says that PEACE Cable connects the top populated areas in the world: Asia, Africa and Europe. “China-Pakistan cross border fibre optical cable makes PEACE cable able to

serve Chinese enterprises along on the One Belt, One Road initiative corridor as large scale Chinese investment in Africa, such as in Djibouti,” says Sun. “On the other hand, Europe is the main traffic destination for Africa, as well as Middle East, where PEACE cable could act as the pipe for this volume of traffic.” The decision to land in Marseille is not surprising given its reputation as a European interconnectivity hub, but considering the likes of London, Amsterdam or Frankfurt as hubs as well, I was curious to know what set Marseille apart from its European counterparts.

Major hubs “Marseille is the preferred destination for Middle East and Africa traffic, and it has a proven carrier neutral data centres where it is easy to interconnect, get IP transit, do peering, and get the backhaul to major hubs in Europe,” explained Sun. Though London, Frankfurt and Amsterdam are also important destinations, Sun says that the terrestrial infrastructure between Marseille and those

places is well developed and there is a competitive market for such connectivity. “The ecosystem in Marseille currently is attractive for cables especially if they serve Mediterranean Sea countries that are having their points of presence (PoPs) in Marseille,” he adds.

European partnerships The company recently announced a number of strategic partnerships with European telcos during Capacity Europe 2018. PCCW Global and Orange will act as landing partners for the cable when it reaches France. With Orange as technical partner, the cable will use Orange infrastructure in Marseille and terminate at a carrier neutral data centre. PCCW Global will act as the commercial manager of the cable in Europe, responsible for all capacity services and landing party arrangements. Sun says PEACE Cable needs to think big and act fast, which of course requires the right partners. PCCW Global’s vast network and extensive expertise made it top of the list for partners. “The landing december/january 2019

the big interview: xiaohua sun | 57

2000

Sales director, Hengtong Optic-Electric

2008

General manager, Guangdong branch unit of Hengtong Optic-Electric

2013

Commercial director, Hengtong Optic-Electric

2014

Deputy general manager, Hengtong Marine

2018

Chief operating officer, PEACE Cable

direct connections to data centre facilities others argue it depends on your proximity to these facilities and the backhaul needed to carry it there. For Sun however, it is the presence in a carrier neutral facility that the biggest attraction for PEACE Cable. “As a cable developer, we’d like as many networks, carriers and users to connect to our cable, which requires our presence in an open access facility. Through experience cable landing stations tend to have restrictions on connectivity to different networks and also commercial challenges.” But he is keen to explain that data centres do not replace the cable landing stations, and that it is required to host certain equipment such as power feeds and optical switches. Additionally he says that there are some technical limitations as well, depending on the proximity of the data centre from the landing point. “Having said that, it is worth mentioning that the concept of carrier

We’ve created a Capacity new business model in the submarine cable industry”

Xiaohua Sun, COO, PEACE Cable

party is a cornerstone for the success of any subsea project. Together with PCCW Global, we had to choose the party that has vast experience in landing cables in Marseille and is able to provide the required level of infrastructure, operation, support, and at the same time the neutrality, because the cable terminal equipment will be hosted at a carrier neutral data centre in Marseille,” explains Sun.

Neutral connections Interestingly PEACE will land at a combination of carrier-neutral data centres and cable landing stations along its routes, depending on “where we find those reputable data centres available and where it is technically feasible. In other locations PEACE cable will land in normal cable landing stations, however the commercial terms will be friendly and close to data centre rules,” says Sun. The increasing number of cable projects forgoing the cable landing station and connecting directly into the data centre is a polarising topic within the industry. While some see it as an advantage to make capacitymedia.com

neutral data centre is not mature in many territories, and it is not possible in some countries to search for a data centre to terminate the system capacity in,” he adds. Huawei Marine was named early on as construction partner of the PEACE Cable, while Hengtong will supply and manufacture the system, a decision that was based on strong former collaborations with the company. Sun explains: “We found a level of dedication and professional project management that exceeded our expectations, as well as innovative subsea technology that is advanced day after day, and we have decided to choose them for this critical investment of Hengtong Group.” Outside of Europe and Asia, the company has struck a number of strategic partnerships in Africa, with its landing points in Djibouti, Somalia, Kenya and South Africa. As we know certain parts of the continent from a networking and backhaul perspective are underdeveloped, but Sun takes an optimistic approach to the challenge, saying: “Some have

backhaul yet in development, some are well developed. PEACE Cable will help on the development of landing facilities including the backhaul network if needed.” In terms of emerging technologies, 5G and the internet of things (IoT) will definitely “fill the network tubes in terms of the access and metro networks”. However, Sun says that “the increasing globalisation of enterprises and people as well as the global real-time communication needs between people-topeople and machine-to-machine will definitely increase the traffic on intercontinental infrastructure like PEACE Cable.”

Open networks The key differentiator between PEACE and many of its competitors is the open nature of its network. Explaining the significance of this on the system, Sun says that the end user reaps the rewards. “Open access would not reduce the cost to us but to the end users,” he replies. “We want to build differentiation for the market to offer interconnection for three of the world’s most populous continents whilst at the same time dramatically reducing latency, delivering a superior connectivity experience, which will be ideal for a vast array of commercial and consumer applications.” As if that weren’t enough Sun also claims that the cable has “created a new business model in the submarine cable industry”. PEACE Cable is investing in the trunk from Pakistan to Marseille and Kenya. Thanks to the wavelength selective switching (WSS) technology at branching units, PEACE will be able to provide modifications to the system in the future as and when demand changes. “It is an open system, so it can be upgraded with any supplier and with the new technologies when they come to the market,” adds Sun. “The upgrade would be defined by the market demand and need with more flexible process compared to the consortium cable systems.” With an RFS date of Q1 of 2020 and a design capacity of 16Tbs per fibre pair using the latest 200G and WSS technology, the PEACE cable has the potential for numerous branching units and the ability to scale. Once live, Sun says there are plans for the cable in both African and transatlantic markets. “We have reserved several branching units on the route, so that we could provide extend to potential landing points,” Sun concludes. “We are also looking at extending into South Africa, the West Africa Coast, and even transatlantic.”

58 | ĆŹ

SEA-ME-WE 5: GOING FROM STRENGTH-TO-STRENGTH Ç§ Ç§ Í? ÇĄ ABDULLAH ALSAMHANÇĄ ÇŻ ÇĄ

Q. Many carriers are looking to upgrade capacity on SEA-ME-WE 5 to help meet the data onslaught over the next few years, how is the system upgrading in terms of capacity?

the design capacity using 400Gbs technology. Q. What are the factors that make SEA-ME-WE 5 such a popular choice for carriers?

Firstly, something that differentiates SEA-ME-WE 5 with other subsea systems is its main endpoints are carrier-neutral with open points of presence (PoPs), and it doesnâ&#x20AC;&#x2122;t just have cable landing stations. SMW-5 introduced the latest SMW-5 is one of the first systems in the globe using ROADM technology developments technology. This technology makes SMW-5 the most flexible with its second upgrade, and system of the today existing ones, by making the traffic between the contracted a new vendor.Capacity As branches and the core adjustable, and also having no effect of a cut a result of the new design, in a branch to other parts of the system. SMW-5 will increase its total, There is also a choice of terminating in either of the two PoPs end-to-end capacity by roughly in Singapore (Global Switch & Equinix) as well as in Europe 60%, from 24Tb to close to 40Tb. (Interxion & Palermo). Furthermore, it provides the lowest latency. The sound initial system design with full landings in different In addition, due to the reliable technology in its wet plant and the countries has played a role in achieving the second light up choice of routes, the low O&M expenses is another big advantage since it became ready-for-service in 2016 and this, coupled where parties enjoy less cost as compared with other systems. with technology development, will certainly result in SMW-5 achieving the design capacity increase. Q. With the quadrupling of bandwidth demand between Europe and Asia expected, how is SEA-ME-WE 5 being upgraded to meet the coming data onslaught? Designed with the latest upgradeable 100Gbps DWDM technology, SEA-ME-WE 5 provides the highest quality voice, data and internet traffic, with minimal transmission delay. The flexibility and scalability of the network, as well as its ability to be remotely configured, have also helped to keep OPEX down. There is an on-going open tender upgrade, which will see 200Gbps/250Gbps technology deployed in major segments of the system. There will be more that 50% improvement in the design capacity (12Tbps per fibre pair or more) and more than 50% cost savings per 100G comparing to the previous update. In respect to future upgrades, the technology roadmap of system upgrade suppliers shows that there is more room to boost

KEY STATISTICS RFS: 13 December 2016 Design capacity: 24Tbps Cable length: 20,000km

capacity

Technology: 100Gbps DWDM Cable landing stations: 18 Consortium: 19 members

Q. Having so many organisations involved in this cable system is impressive but how do you overcome the inevitable challenge of so many stakeholders in one consortium? SMW-5 has a very well established founding agreement (C&MA) which regulates the operation and decision-making processes of the consortium based on commonly agreed rules. The consortium follows the C&MA rules, which helps us making decisions even in sensitive situations. However, keeping the SMW-5 rules in the forefront does not mean rigidity in decision-making. The consortium, using its professional committeesâ&#x20AC;&#x2122; suggestions, openly discusses all new opportunities and makes a decision as a result of the fruitful discussions among the parties. Leadership, strong commitment has brought inspiration to all parties; further proven financial stability and recognised technical know-how from its consortium members has proved to be a strongpoint in working together. Q. Are there any plans to connect SEA-ME-WE 5 to more countries? If so, which ones? SMW-5 still have possibilities to add new branches/members to the system, especially at the regions of Thailand and India. The branching units for connecting these regions are initially installed in the system. Connecting them is dependent on reaching an december/january 2019

| 59

agreement with the potential new Parties. I should also add, SMW-5 is such heavily used today, which can mean, the today Parties will fully utilize SMW-5’s full capacity. SMW5 is landing in various countries having important landing stations of various international cable systems stretching to East Asia, Africa and Europe; hence if the cross connection charges at those locations are rationalized, it will bring even more value to the system. Q What have been the biggest SEA-ME-WE 5 highlights/ milestones to date? The system has helped alleviate the dependence on existing cables, and allowed greater voice and data traffic between regions. The project has been a success story right from its inception on 13 December 2016 when it launched with 25% of the system’s total design capacity taken up. It continues to make headlines in the industry and as such, the system has been acknowledged with a number of awards over the past two years. SMW-5 has eased the strain on the heavily loaded networks that connect Western Europe, the Middle East, East Africa and Southeast Asia, as well as offering an extra layer of network and further enhancing the diversity and resilience to the heavily loaded Asia-Middle East-Europe route. Aside from this, there has been a massive surge in demand for capacity in burgeoning global markets, such as countries in the Far East, creating a growing need for extra capacity options.

SMW-5 also offers major cross-connection possibilities with other submarine cables in countries such as Egypt, Saudi Arabia, Djibouti and Sri Lanka – creating the promise of many exciting opportunities. On top of all that, latency on the new network has dropped by tens of milliseconds compared with earlier SMW networks between major end points. For instance, between Singapore and Marseille the latency has significantly improved compared with the previous network from 163 to 135ms, and between Singapore and Palermo from 148 to 124ms. Such key improvements offer a significant edge in a highly competitive market. Q. What developments can we expect to see with SEA-MEWE 5 over the next year? SMW-5 is well-placed to meet the high level of demand created by digitisation. This is important given the huge rise in use of services and applications in areas such as the internet of things (IoT) and machine-to-machine (M2M) communications. Completing LU#2, the largest extension in SMW-5’s history, introducing a new vendor, and installing new technology in the system. We will be enhancing the design capacity through the adoption of new technology, maximising the monetisation of the system.

Capacity

capacitymedia.com

60 | market trends: subsea cables

A SUBSEA CABLE INDUSTRY IN TRANSITION

s of the start of 2018, there were around 448 submarine cable systems operating around the world, covering 1.2 million kilometres, according to TeleGeography. But the subsea cable industry could be on the verge of facing a so-called “mass extinction”, according to Alan Maudin. This is because a number of cables built during the ICT boom of the late 1990s and early noughties are approaching the end of their 25-year design lifespan. Demand for international capacity has grown dramatically in the last decade, and even more so in the last few years, with a compound annual growth rate of 45% predicted between 2017 and 2024. This means there will be even more investment in new cable systems – the highest amount since 2012 is predicted by TeleGeography.

xxxxx, xxxxx, xxxx Compounding growth leading to massive volumes Used international capacity, 2011-2024 10,000

Capacity

hƐĞĚ /ŶƚĞƌŶĂƟŽŶĂů ĂŶĚǁŝĚƚŚ ;dƉďƐͿ

8,000 45% CAGR 2017-24 6,000

4,000

2,000

0 2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

Source: TeleGeography

Demand for international capacity has grown dramatically in the last decade, and even more so in the last few years with a compound annual growth rate of 45% predicted between 2017and 2024. This means there will be even more investment in new cable systems – the highest amount

since 2012 is predicted by TeleGeography. Even with the introduction of many new cables and the ability for older cables to accommodate 100Gbps technology, the growth of potential capacity has failed to outpace that of lit capacity. As a result, the percentage of capacity

that is lit on major routes began to slowly rise between 2013 and 2017. During this period the share of potential capacity that was lit rose from 17% to 30% on trans-Atlantic cables, while the trans-Pacific route increased from 22% to 29%. december/january 2019

| 61

Large investment in new cables underway Investment in new submarine cable systems by ready-for-service year, 2010-2020

hƐĞĚ /ŶƚĞƌŶĂƟŽŶĂů ĂŶĚǁŝĚƚŚ ;dƉďƐͿ

$4.0 Actual

$3.5

Announced

$3.0 $2.5 $2.0 $1.5 $1.0 $0.5 $0.0 2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Source: TeleGeography

Trans-Atlantic and Trans-Pacific capacity growth Trans-Atlantic

Trans-Pacific

30%

25%

Capacity 25%

20%

15%

10%

0% 2013

2017

2013

2017

Source: TeleGeography

The rapid expansion of major content providers’ networks has caused a huge shift in the global wholesale market. Google, Microsoft, and Facebook are investing in new intercontinental submarine cable systems and purchasing

increments of fibre pairs. Although this removes large swaths of bandwidth from the managed wholesale bandwidth market, it also drives scale to establish new submarine cable systems and lower overall unit costs. Many submarine cable business

models actually rely on this largesse, allocating fibre and shares thereof to the largest consumers to cover initial investment costs, then selling remaining share of system bandwidth as managed wholesale bandwidth.

TeleGeography has published its latest cable map, which highlights different cable systems across the globe

capacitymedia.com

Capacity

special report

SECURITY December/January 2019

CONTENTS 65 Security products Industryâ&#x20AC;&#x2122;s top six for security

66 Tracking criminal minds How is the carrier community acting to mitigate threats?

68 Big interview Nicolas Arpagian, director of strategy, Orange Cyberdefense

Capacity

70 New name, same security The dawn of a fresh era of innovation for Deutsche Telekom

73 Market trends Security findings of the GLF

Sponsored by

capacitymedia.com

Did you Know ? Each day

$46,575,342 is lost worldwide through voice fraud

This is Why Capacity

getting the platinum HUK 'Ă&#x201E;YZ[ ZVS\[PVUZ for retail customers is key to protecting our voice services Learn more about anti-fraud and security solutions that support Orange International Carriersâ&#x20AC;&#x2122; legacy products https://wholesalesolutions.orange.com/

@orangeIC

feature: security products | 65

Security Solutions

AS THE NUMBER AND COMPLEXITY OF CYBER ATTACKS INCREASES, THE INDUSTRY IS RESPONDING BY RELEASING A NUMBER OF PRODUCTS AIMED AT HELPING ENTERPRISES AND TELCOS TO TACKLE THIS THREAT. CAPACITY HIGHLIGHTS A FEW OF THE KEY SECURITY PRODUCTS CURRENTLY AVAILABLE ON THE MARKET

Company: Deutsche Telekom Product name: Magenta Security

Company: NTT Communications Product name: DPS Detect Solution

This Deutsche Telekom solution acts like a protective cyberNTT Communications offers its customers a comprehensive set shield, protecting against internet-based threats. Designed with of tools and products that we offer Global IP Network customers simplicity in mind users can access all solutions from a single for security. It has launched a brand new tool for its DDoS source. The portfolio features a governance, risk and compliance Protection Services (DPS), which offers protection from management solution. There is an analysis, consulting and testing distributed denial of services attacks, service from specialist experts and consultants, plus solution NTT’s Detect Solution can help customers detect potential Capacity design and implementation services for digitisation and attacks directed to their networks and initiate mitigations faster. It networking, as well as security across data, application and cloud. comes in addition to existing DPS products, which include DPS In addition, the portfolio includes network/ICT security that Control and DPS Core. It provides an advanced level of service leverages internal early-warning systems such as Telekom CERT above DPS Core as it adds detection capabilities to help identify at client’s data centre and cloud. In the mobile space. It also offers potential attacks using state-of-the-art technology while working endpoint and mobile security. with customer-defined thresholds Company: Juniper Networks Product name: Advanced Threat Prevention

Company: Oracle Product name: Dyn DNS security services

Juniper Networks’ Advanced Threat Prevention Appliance provides comprehensive on-premises protection against a sophisticated, ever-changing threat landscape. It uses advanced machine learning and behavioural analysis to identify existing and unknown advanced threats in near real time. It does this through continuous, multistage detection and analysis of web, email, and lateral spread traffic moving through the network. The appliance ingests threat data from multiple security devices, applies analytics to identify advanced malicious traits, and aggregates the events into a single comprehensive timeline view of all the threats on the network.

When Oracle bought Dyn in 2016, it inherited a full suite of security services, which sits under the Oracle Dyn Web Application Security umbrella (formerly Zenedge). Central to Oracle/Dyn’s offering is its Domain Name System (DNS) security services. Dyn provides managed DNS for some of the world’s largest web properties and digital brands. Behind this service is one of the largest, fastest and most resilient DNS networks in the world, it claims. Over 3,500 enterprises, including pre-eminent digital brands like Netflix, Twitter, Linkedin and CNBC use the company’s DNS solutions.

Company: Kaspersky Product name: Hybrid Cloud Security

Company: Orange Product name: Orange Business Services CyberSOC

The Kaspersky Hybrid Cloud Security solution provides multilayered protection to multi-cloud environments. Wherever you process and store critical business data – in a private or public cloud, or both – the solution offers a combination of agile, continuous security as well as efficiency, protecting users data against current and future threats. The offering includes proven security for virtual and physical servers, advanced protection for workloads in public clouds including AWS and Microsoft Azure. On the management side of things its offers borderless manageability, flexibility and visibility via an enterprise-level orchestration console. In addition, the solution includes full protection for workloads.

Orange Business Services offers complementary services managed by experts from Orange CyberSOC. Web Guardian offers protection and performance for web applications, with access via 180,000 Akamai servers distributed throughout the world. Websites are hidden behind these servers. Cleanpipe protects bandwidth and data centres, redirecting traffic to cleaning centres distributed throughout the world. Illegitimate traffic is eliminated and the cleaned traffic retransmitted. Site Guardian protects data centres. It is installed on-site between the internet router and the equipment. It cleans traffic upstream of equipment and complements Cleanpipe to reduce slow performance related to redirection, protecting bandwidth.

capacitymedia.com

66 |

The challenge of tracking down

criminal minds AS CONNECTIVITY GROWS, SO DOES THE OPPORTUNITY FOR FRAUD AND CYBER ATTACKS. GARETH WILLMER LOOKS AT HOW THE CARRIER COMMUNITY IS TAKING ACTION TO MITIGATE THESE THREATS

n these hyperconnected times, more and more aspects of our daily lives are becoming hooked up to the online world and the internet of things. As these “things” are linked to events such as gigantic distributed denial-of-service (DDoS) attacks, post-Snowden paranoia grows about exactly how secure we all are. The move to digital platforms and the rise of new tools such as those for automation are also expanding the scope for fraudsters to launch attacks, with methods such as robo-dialling to assist so-called “Wangiri” callback scams. Figures from industry organisation the Communications Fraud Control Association (CFCA) show global telecoms fraud losses actually declined from $38 billion in 2015 to $29 billion last year. While this indicates better industry coordination and collaboration on such issues, it is still a multibilliondollar problem. And there are other factors at play, too: the CFCA says, for a start, that criminals are using operators as an access point to perpetrate fraud across other industries, while the increased focus on cybersecurity issues is also more difficult to link to specific revenue losses. One shift is that revenue from traditional call-based fraud is falling, explains Jason Lane-Sellers, president of the CFCA and a solutions director at security company ThreatMetrix. Criminals are thus seeking new ways to profit by not only swiping revenues

Capacity through measures such as callback fraud, but also using this activity as a chance to collect customer data to launch other types of attack. International wholesale carriers are becoming more aware of threats and taking additional action, says LaneSellers, and in an ideal world would be in a great position to see distributed network attacks in a single view and stamp them out. However, a big issue in security is that the vast interconnected nature of the industry means it is often difficult to assess where the responsibility lies for dealing with particular threats. “Probably one of the biggest problems of telecoms fraud is that interaction and interoperation internationally is very difficult,” says Lane-Sellers. Compounding this, he says, is the major challenge of tracking and taking down criminals that tend to be composed of organised networks with attack origination points that may, for example, flit from Africa to Russia to the US, and so on, week by week. By the time authorities can act, they may be “chasing ghosts”, he says, adding that to muddy the waters further, an effective criminal operation will “target lots of different telcos, distribute the volume and distribute the attacks, so it’s never at a significant scale with one operation”. Nevertheless, he says carriers are becoming more proactive over time at

tackling these threats and understanding that it’s an “industry responsibility” to nip them in the bud. Arnd Baranowski, CEO at international voice management company Oculeus, agrees that wholesale carriers are doing more to upgrade their practices and the technologies they use against attacks. That’s essential, he says, with carriers in the past often lacking a full understanding of the traffic on their network and even being “indifferent” to the fact that traffic they handle may include fraud.

More than money Carriers agree it is crucial to act on these issues, with far more to lose than just money. “In addition to financial damage, reputational impact can be significant, and the likes of Wangiri and PBX hacks can have a negative impact on consumer perception of a telco,” says Katia Gonzalez, head of fraud operations at BICS. BICS recently gave an indication of the size of the market, reporting that its FraudGuard service had blocked more than 600 million fraudulent call attempts and saved about €2 billion in wholesale exposure for customers since its launch in 2013. “However, despite there being so much at stake, the industry has historically been reluctant to discuss fraud,” says Gonzalez. This, she says, stems from a reticence among operators to admit they have been targeted, perpetuating the problem december/january 2019

Image: istockphotos

feature: security | 67

because telcos are unaware of threats that service lets IoT devices talk to other supervised and assessed.” Despite this, others have experienced. says Uguet, carrier IT is a key element that devices, conduct transactions and Indeed, the Global Leaders’ Forum requires focus as telecoms assets shift from exchange data, but is more secure because (GLF) has already noted in the past that it’s not visible on the public internet. premises-based assets to virtualised ones there is a lack of consistency in fraud Richard Sellings, principal consultant in the move to technologies such as SDN, metrics tracked, with less than 70% of for APAC, EMEA and Latin America at NFV and cloud. carriers also reporting these to CEO level. Verizon Partner Solutions, says that for “We have seen some major wholesale Nevertheless, says Gonzalez, the tide is businesses mitigating threats in the players developing cybersecurity turning, with the media focusing more on portfolios with external partners, so we current climate, “a fast response is critical, international telecoms fraud and not only to contain unwanted activity, can see that threats are being taken regulatory and law enforcement but also to protect sensitive data” and that seriously,” she says. authorities moving to crack down on it. any lack in coordination between people, In the attack environment, says “Luckily, this mindset in the industry is processes and technology can result in CenturyLink chief security officer Chris slowly changing,” she says. significant blind spots. Betz, “the stakes are high”. He notes that One of the key ways this is being done To this end, he says, Verizon has used the cost of data breaches is continuing to is through carriers collaborating in bodies rise, with some reports indicating the methods such as building seven dedicated such as the GLF and i3forum, in which security operation centres around the average cost of a stolen record is now BICS plays a world to major part, and monitor the earlier this year availability working to and health of launch a code of security conduct as a devices – with guide to help the alerts they carriers manage generate fraudulent traffic. analysed and “A collaborative acted on by Katia Gonzalez, head of fraud operations, BICS end-to-end Verizon. industry Meanwhile, approach is the at iBasis, fraud Capacity only way of reducing fraud in telecoms,” product manager Guillermo Hurtado says about $150. On top of that, regulatory says Gonzalez. that often attacks are much faster than consequences in areas such as GDPR can before, requiring more real-time result in additional fines. Education detection, something iBasis has focused Betz points out that CenturyLink’s Elsa Uguet, anti-fraud and security on in the past couple of years. The broad oversight as a global provider of marketing director at Orange company uses an algorithm fed with network services provider gives it insight International Carriers, says a lot of active call details that monitor, analyse that it uses to give it a proactive approach education is still needed in the industry. and evaluate calls while in session, rather by sharing threat intelligence and “People tend to think that it only happens than traditional systems that analyse call mitigating known threats – with the to others, but this is far from the truth. records once the call is completed. “That’s company last year tracking an average of Some customers have initially not been the only way you can combat the new 195,000 threats per day. totally convinced by the necessity for fraud attacks,” he says. Measure-countermeasure robust protection, and we see them There is no doubt that industry Philip Celestini at global connectivity coming to us only after they have been hit players and observers alike agree it is enabler Syniverse, who was recently by an attack.” critical to deal with these issues. appointed chief security and risk officer She highlights that carriers need to be “Cybersecurity is increasingly becoming after time spent in senior positions in the on alert because of how simple it is to do a group board-level issue for all FBI, paints a picture of the ongoing battle things such as “buy” a DDoS attack from businesses,” says Andy Dell, TMT against fraud. “As I always used to tell my certain sources on the dark web – “so cybersecurity lead at PwC. “Crossfolks in the FBI and the intelligence easy, in fact that anyone can do it, industry collaboration and with community, for every measure we take, the government agencies is also critical – no including teenagers. Carriers will need to bad guys will take a countermeasure, and provide more and more protection, both one organisation can tackle this alone.” then we’ll have to take a counterfor themselves and for their customers.” Atul Gupta, a partner at KPMG who countermeasure, and so on and so on.” With this in mind, Uguet says Orange looks at cybersecurity and telecoms, says One of the big issues he sees is in the International Carriers has developed a carriers have set up specific teams to focus roaming area, which fraudsters are set comprehensive portfolio of offers across on cyber, as well as seeking to instil the to have more room to exploit due to threat tracking, network protection, concept of “security by design”. rapidly surging communications and identity protection and audit, and works Uguet at Orange International Carriers data use by travellers. “There’s more closely with the Orange Cyberdefense underlines how operators need to be activity, so more weeds for them to hide division to define mitigation products for proactive on fraud and cybersecurity to in,” says Celestini. the wholesale market. avoid being pushed from another Syniverse seeks to help businesses and She adds that it’s not about protecting direction. “No one is comfortable having carriers by connecting them up to a just a single part of the network. “The an operator which has suffered from data private network through its recently question is not what elements of the leaks,” she says. “If the push to do launched Secure Global Access product, network are vulnerable or most something about these threats does not vulnerable, because any and all equipment aiding with protection from things such come from operators themselves, it will as DDoS attacks via IoT devices. The can be vulnerable, so it all needs to be certainly come from the end users.”

A collaborative end-to-end industry approach is the only way of reducing fraud in telecoms”

capacitymedia.com

68 |

Fighting the

cyberguerre in Orange Nicolas Arpagian, whose Twitter handle is @cyberguerre, heads strategy for Orange’s ambitious and fast-growing cybersecurity operation. He tells Alan Burkitt-Gray that the 2017 NotPetya Capacity cyber attack brought home the dangers to CEOs

ike many telecoms companies, Orange’s interest in cybersecurity stems from its desire to protect its own networks. And then, like a few, it recognised that a business could be built from the separate parts of the company that until then were independent. “We decided it was important to develop cybersecurity as a strategic activity,” says Nicolas Arpagian. “Until then we were working in a large number of places with no coordination.” Arpagian is the director of strategy at the division that emerged from that realisation, Orange Cyberdefense. It was developed from the January 2014 acquisition of a small operation, Atheos, which had 130 experts working with French businesses to define, implement and control their security strategies. Atheos founder Michel Van Den Berghe became the CEO of Orange Cyberdefense, which was expanded to include the security operations centres and other cybersecurity activities of Orange Business Services (OBS). At the time of the acquisition, for an undisclosed price, Van Den Berghe said: “We

have consistently recorded strong growth since our incorporation in 2002. By joining Orange Business Services, we will benefit from its unique expertise of critical infrastructure to take us to the next level. Orange Cyberdefense offers a credible response to the security requirements of large companies and government agencies.” Four years later, Arpagian says: “We are now more than 1,300 people in Orange Cyberdefense.” He emphasises how important the unit is to Orange group CEO Stéphane Richard’s corporate strategy, Orange 2020. The boss has given the team the mandate to build France’s number-one cybersecurity business “and a leader in Europe”, Arpagian adds. “We have achieved €300 million turnover this year. We are now, by the number of people and turnover, the number one in France and we are in the top six in cybersecurity in Europe. We wish to be in the top three in Europe in cybersecurity by 2020.” You can tell how seriously Arpagian is about cyber security from his Twitter handle, @cyberguerre, French for “cyber war”. His timeline, above right, seems to show a

number of rapid changes in his activities – but in fact he’s had several of them at the same time: a lecturer and professor at a number of universities, from Paris to Beirut, as well as France’s national police school, and an editor at le Journal du Net, a leading IT publication. He’s run courses on digital security and on organised crime and cyber criminality, and in May 2018 published a book on cybersecurity – La cybersécurité. Arpagian has had the Orange role since 2015, the year after the Atheos acquisition. In order to achieve its growth targets “we want to continue to invest”, he tells me, adding that Orange is looking for acquisitions. “We’re just getting a branch in Morocco. It opens in January. We will be able to develop with demand, in Morocco and across Africa. The idea is to continue to have that development.” Though Atheos was acquired through OBS and, though Orange Cyberdefense was at first a division of OBS, “the entity for professional services”, when the unit was created, it has been moved to a more prominent position in the group’s hierarchy. “Stéphane Richard wanted to appoint december/january 2019

the big interview: nicolas arpagian | 69

2006

Lecturer, Institut des Relations Internationales et Stratégiques, Paris

2010

Professor, management of strategic information, École Supérieure des Affaires, Beirut

2010

Scientific director, digital security, Institut National des Hautes Études de la Sécurité et de la Justice, Paris

2010

Head of conferences, École Nationale Supérieure de la Police

2011

Editor, Le Journal du Net

2013

Course director, fight against organised crime and cyber criminality, University of Strasbourg

2015

Director of strategy, Orange Cyberdefense

assets, what are the weak points? What has to be changed? We offer to manage cybersecurity for our customers. We want to help during a crisis, and at the end of a crisis we want to help them to build and start again, to find the bests way to be back in business and to recover data.” The European Union’s General Data Protection Regulation (GDPR) and other regulations have helped spread awareness of cybersecurity. “People face exactly the same issues in places such as the US and Asia, and many companies in Africa are working for French companies and have to adopt GDPR. We see a large extension of the need for cybersecurity. We’re seeing exactly the same trends in Africa, a very strong trend towards having legislation on IT security. This creates an agenda for many companies, and it has an impact for medium-sized enterprises.” The cybersecurity unit prioritises investments into countries where Orange has

Saint-Gobain was not the NotPetya target determined by Capacity the hackers. It was among the victims” Nicolas Arpagian, director of strategy, Orange Cyberdefense

someone from the executive committee, as a sign of its importance. Cybersecurity is a strategic activity for the group,” says Arpagian. Orange Cyberdefense is now in the charge of Hugues Foulon, who was head of Richard’s office and secretary of the group’s executive committee. Since May 2018, Foulon has been Orange’s director of strategy and cybersecurity activities. He has equal status to other main-board directors such as OBS CEO Helmut Reisinger, Fabienne Dulac, who is CEO of Orange France, Laurent Paillassot, CEO of Orange Spain, and Jérôme Barré, CEO of wholesale and international networks. Van Den Berghe, founder of Atheos, is still CEO of Orange Cyberdefense. This change in structure has created a focus on the countries where Orange has local fixed or mobile networks. “In Poland, Spain and Belgium we want to increase our activity in cybersecurity services,” says Arpagian. That includes consulting or running services through a hub “like we have in France”. The company wants “a holistic approach to cybersecurity, starting from audit and consulting”, he explains. “What are the capacitymedia.com

a local operation. “We have people there and the trademark is already well known.” And, “in cybersecurity the question of nationality is important”. He means that many organisations are unwilling to work with companies that are outside their national boundaries. Many countries have rules that data must be stored locally and not in the territory of a different nation. “In the US I’m not sure that some companies would pick a European company to secure their assets, so we have to choose our destination. The question of trust is important. We work for American companies, obviously. The question of trust in cybersecurity is important.”

National infrastructure Orange Cyberdefense has particular strengths in protecting infrastructure of national importance, he points out. “Among the entities most concerned about cybersecurity for strategic reasons are energy, telecoms, water, finance and banking, and so on,” he points out. “We’ve had to invest in those fields. It’s important not to have any interruptions. This isn’t a question of

protecting business sectors but of protecting critical activities.” Indeed, such organisations have to ensure their infrastructure is protected from cyber attacks by legislation, he notes. “No other companies are forced to do this by significant legislation.” Arpagian recalls the notorious NotPetya cyber attack launched via Ukraine in June 2017. It cost many companies around the world hundreds of millions, “but it was a good demonstration of the need for cybersecurity” for CEOs and other senior executives of companies. One report lists corporate victims as including FedEx, Maersk, Merck, Mondelēz, Reckitt Benckiser and the French construction company Saint-Gobain – which told shareholders that the attack had “a negative impact is estimated at less than €250 million on sales and €80 million on operating income”. That led the insurance industry to ask companies what they are doing to protect themselves, says Arpagian. It’s equivalent to asking someone whose house has been burgled if they have a burglar alarm, he adds. The banking industry is doing a stress test on how its own members will face up to such an attack. “The results will be published in January. We want to be sure companies can maintain their activity even if they’re under cyber attack. There is national legislation for critical national infrastructure but more and more businesses in vertical industries are working with their own bodies to make sure they are not affected by attacks.” Some companies with low margins will be reluctant to spend on cybersecurity, he admits. But it’s not enough for companies to say they aren’t going to be targeted. “SaintGobain was not the target determined by the hackers. It was among the victims.” The effect of NotPetya lasted around two weeks, but the financial impact was immeasurable. “Insurance companies are starting to do some mathematical modelling. The financial sector is a very powerful influence on companies to do something – and there will be national legislation.” Companies will have to identify digital assets, he says. “No one wants to do that before the attack. But if they work out the value of their assets they will be able to have a proportionate answer. What are the essentials you have to protect?” Some companies get it wrong. One client said its list of customers and its list of patents had to be protected from cyber attack. “We said that was not essential. Your competitors know your customers and your patents are published.” But the client made products for the car industry, delivering just in time to customers’ factories. If it were late in a delivery because of a cyber attack, it would have to pay a fine to the carmaker. “This was the element that had to have the strongest protection,” says Arpagian.

70 |

NEW NAME, SAME SOLID SECURITY DEUTSCHE TELEKOM GLOBAL CARRIER Č&#x192; ÇŻ

Č&#x192; Ç¤ ÇĄ

Ç§ Í&#x203A;Í&#x17E;Í&#x2DC;Ç§ Ç¤ Deutsche Telekomâ&#x20AC;&#x2122;s wholesale 360-degree focus division has welcomed in an Having a laser-guided focus on network resilience and reliability exciting new era with its renaming is key at a time when there has never been such a strong need as Deutsche Telekom Global for robust security systems â&#x20AC;&#x201C; and the companyâ&#x20AC;&#x2122;s 360Â° Defense portfolio for protection continues to be just as valid as before. Carrier, reflecting todayâ&#x20AC;&#x2122;s need for The portfolio comprises a comprehensive range of products that innovation and speed of response to technological transformations in puts it at the cutting edge of security and creates a high level of assurance for clients and partners on the network. These include the market. But although big changes areCapacity afoot MPLS-based IP-VPN, a global IPX platform, an SS7 firewall and fraud-fighting voice and SMS offerings. in the industry, one thing remains Services such as those that mitigate against SMS fraud are a constant â&#x20AC;&#x201C; Deutsche Telekom particularly relevant in light of the growth that application-toGlobal Carrierâ&#x20AC;&#x2122;s commitment to person (A2P) messaging is expected to see in the next few years. security. While customers can Deutsche Telekomâ&#x20AC;&#x2122;s SMS+ Protect service helps to defend against therefore expect the company to innovate to keep ahead of the and block grey route traffic that bypasses termination fees. It also game, Deutsche Telekom says they can also benefit from the same identifies and stops fake SMS messages such as spam, spoofing high level of security offered through its 360Â° Defense strategy. and ghost messages. Such mitigation can lead to additional This is because of the carrierâ&#x20AC;&#x2122;s long-standing ethos of providing security as a central pillar of its operations that filters down into revenues for operators that they were losing out on before. every part of the organisation. It is offered not as an afterthought, New this year is also Deutsche Telekom Global Carrierâ&#x20AC;&#x2122;s but as something included from the start in all the activities in Secure Cloud Connect service for private cloud customers, which Deutsche Telekom Global Carrier is involved â&#x20AC;&#x201C; and this which meets the need of those looking for a restricted approach will be carried through into its fresh strategy. and secure, high-service-level location for mission-critical â&#x20AC;&#x153;Security is a core pillar of the Deutsche Telekom strategy. This applications. Going forward, the company is seeking to bolster is cascaded down to all levels within the organisation,â&#x20AC;? says Rolf this offering by adding new direct cloud partners, making Nafziger, senior vice president of Deutsche Telekom Global Carrier. it available in new global locations and launching different The companyâ&#x20AC;&#x2122;s new name, adopted at the end of the October, versions of the service. partly reflects its ability to offer customers and partners all they The Cloud Connect service has seen rapid adoption in the need from a single source, as well as providing the global reach of market, says Bertold Frech, head of Carrier Enterprise Services at Deutsche Telekomâ&#x20AC;&#x2122;s network. Deutsche Telekom Global Carrier. â&#x20AC;&#x153;We are addressing the security This all-encompassing â&#x20AC;&#x153;globalâ&#x20AC;? approach is also present in the needs of carriers and their enterprise customers by enabling security area, where the scale and vast experience of its parent private, secure and redundant access to a suite of cloud providers mean that Deutsche Telekom Global Carrier can benefit from and data centres in Europe and the US,â&#x20AC;? he says. â&#x20AC;&#x153;The service Group-wide security innovations. The company monitors traffic leverages our security capabilities combined with easy scalability across its worldwide network and market trends to identify new and fast implementation times.â&#x20AC;? threats and potential remedies, using what it describes as â&#x20AC;&#x153;strong Anti-fraud activities form part of the carrierâ&#x20AC;&#x2122;s voice products expertiseâ&#x20AC;? in anti-fraud intelligence. and the company is developing extra features and a customer The security strategy is also aligned with Deutsche Telekom portal to provide more tailored services. At the moment, it offers Global Carrierâ&#x20AC;&#x2122;s overall reinvigorated approach to the market, individual fraud alerts based on customer requirement and plans with the company launching new products where required to to add additional insight from reports and blocking functions in ensure it can deal effectively with any emerging threats. the near future. These moves are expected to fulfil todayâ&#x20AC;&#x2122;s customer needs Deutsche Telekom has put in place a fully automated big data in line with the companyâ&#x20AC;&#x2122;s renewed strategy. â&#x20AC;&#x153;To help our service for monitoring and blocking that operates in close to real customers prepare for an uncertain tomorrow, we saw the need time for all of the networkâ&#x20AC;&#x2122;s international voice traffic. It is further to make changes to how we conduct our international wholesale enhancing this by developing machine-learning capabilities for business,â&#x20AC;? says Nafziger. the service, improving its intelligence for rooting out threats. This

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december/january 2019

| 71

Winner

Best European Project

Best Global Wholesale Carrier – DATA Deutsche Telekom Global Carrier

Best Pan-European Wholesale Carrier Deutsche Telekom Global Carrier

Deutsche Telekom Global Carrier

type of monitoring can help identify and stamp out activities such as Wangiri fraud, which involves coaxing unsuspecting mobile users into making calls to international premium rate numbers. And with the complexity of voice fraud on the rise, these types of tools are increasingly needed to deal with such issues.

certainly a priority for any provider of connectivity solutions and traffic handling.” In the meantime, Deutsche Telekom Global Carrier is seeking to ensure it is well set-up to manage these threats. Its DDoS Defense service offers defence against both volumetric and application-based DDoS attacks, with continual analysis of IP flows, detailed reporting and monitoring, and protection available for both backbone and cloud security. In addition, it is offering a new bespoke DDoS protection service for mobile operators that takes advantage of Deutsche Telekom’s global network.

DDoS Defense Not least among the carrier’s security products is its DDoS Defense offering, which seeks to deal with the proliferating threat of distributed denial-of-service activity driven by the rise of the internet of things (IoT). This surge in IoT is accompanied by a need to update security systems to ensure they are watertight. All about teamwork On top of all this, the carrier has set up its team to provide full Indeed, there may be an even more urgent push to do so given that some in the industry have ramped up their forecasts for support for managing security threats and fraud. For example, apart from offering its 24/7 big data monitoring system, it volumes of IoT devices, following faster-than-expected growth Capacity this year. Ongoing large-scale deployments in China, for example, provides individual manual monitoring and evaluation if any fresh or more complex scenarios spring up. led Ericsson this June to almost double its prediction made last November for global cellular IoT connections from 1.8 billion to And even though stability is a key principle for security in this 3.5 billion by 2023. And in total, Ericsson is predicting about 20 new era, the company is making sure it innovates here as well and has recognised some hugely promising paths to pursue in this area. billion IoT devices among the more than 30 billion connected Blockchain is gaining traction for a start, with its potential devices by then. stemming from its ability to hugely simplify intercarrier Market trends for the related security threat posed are reflected in the figures of DDoS security provider Nexusguard: the company transactions and create an immutable record of them – with the technology also offering some beneficial security aspects in terms reported a more than fivefold rise in the average size of DDoS of data handling and storage among players in the industry. attacks in the second quarter compared with a year earlier, to over 26Gbps, and a rise of almost 30% in the number of attacks. In addition, Deutsche Telekom Global Carrier is fully involved in cooperating with other international carriers and anti-fraud Indeed, 2018 has seen some unprecedented cyberattacks in organisations such as the i3forum and the ITW Global Leaders’ terms of size. Arbor Networks, the security division of Netscout Forum. It was among the first carriers to sign this year’s code of Arbor, early this year confirmed a DDoS attack with a recordconduct introduced by these two bodies in a bid to reduce fraud breaking size of 1.7Tbps against the customer of a US-based in the international wholesale market. service provider. This came mere days after GitHub was hit by an These activities are aligned with the fact that the company attack measuring 1.35Tbps, a reported previous record size. recognises that no single carrier will be able to protect the entire Deutsche Telekom’s experts themselves manage hundreds of global ecosystem on its own, with close cooperation therefore DDoS attacks each month on the company’s network. “Security being key to stamping out the big threats of today. will become a key critical component of a reliable IoT solution Whatever the new challenges faced in the future in the swiftly as the traffic handled between devices and carriers is increasingly changing market, many of which cannot yet be predicted, IoT-based,” says Max Röttgermann, senior product manager Deutsche Telekom Global Carrier therefore has a wide variety of for IP Transit and DDoS Defense at Deutsche Telekom. “The tools and strategies in place to help address them. full scope of security services is not known at this stage, but it is

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'(876&+( 7(/(.20 */2%$/ &$55,(5 &211(&7,1* 7+( :25/' )25 <28 The telco landscape is rapidly transforming. Nowhere is that clearer than in our business, where a new era of global connectivity has already begun. To more quickly respond to our clientsâ&#x20AC;&#x2122; changing wholesale needs, weâ&#x20AC;&#x2122;ve reinvented ourselves. By simplifying processes, intensifying collaboration and enhancing agility. Plus, our expanded portfolio offers all you need from one source. Deutsche Telekom Global Carrier delivers the Capacity most innovative, future-proof solutions that guarantee a long and secure tomorrow for your business and the entire industry. Get in touch: globalcarrier.telekom.com

market data: fraud | 73

TAKING ACTION AGAINST FRAUD The ITW Global Leaders’ Forum (GLF), recently launched a report into fraud within the wholesale industry, which costs the sector an estimated $17 billion annually. Capacity details some of the key takeaway’s from the GLF report.

Call Hijacking Call hijacking is the redirection of traffic to compromised networks or from compromised devices with the intention of maximizing call duration to maximize billing. There are two predominant scenarios: Redirection of normal customer traffic to a network using a recorded message with the intention to keep the customer online for maximum time; Artificial inflation of traffic from a compromised PBX or mobile phone(s) With call hijacking, the fraudulent party will ensure, through low pricing, that they are in route for a destination and will select unallocated numbers in the destination network. Their partner generates high volumes of calls to these unallocated numbers and all answered with long durations. Other carriers receiving these calls will either fail them as “number unallocated” or return a route advance signal which simply redirects traffic to the fraudulent supplier. Just over 30% of respondents to the GLF survey said that over the past year, the volume of call hijacking has increased, while just under 45% saw a decline. A concerted effort to drop problematic customers was cited as a key reason for some carriers identifying a decrease in call hijacking.

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False Answer Supervision False Answer Supervision (FAS) involves a party in the traffic flow chain returning a false answer signal to the carriers earlier in the chain, which initiates billing for all parties. There are two variants of FAS: Many carriers are at the beginning of the learning curve with new technology and tools and expect to progress as they become more sophisticated in detecting fraud. Carriers can learn from the fraud they detect as it makes them more efficient in the face of future attacks. While the proportion of smaller attacks has risen, the number of larger attacks has declined. Participants said recently implemented tools have led to the detection of more attacks but because of improved tools and infrastructure the response time is much lower. Thus, the value per attack is reportedly dropping or being eliminated entirely. One carrier, which represented a common view, said: “We recently implementing a next gen tool and are detecting more attacks, but, because we are a lot faster, the value per attack is dropping or being eliminated entirely. So, we are experiencing and detecting more cases, but the overall fraud value is dropping.” There will always be a back and forth battle against fraud; as one weakness is resolved, another will likely appear. Carriers current goal is simply to stop the most potent attacks and systemically make it more difficult to perpetuate attacks in the future. Two of the more important use-cases, PBX hacking and Wangiri, have become a focus of many carriers for differing reasons. capacitymedia.com

74 | market data: fraud

Carrier view of priority of fraudulent traffice management within their organistion tŚĞƌĞ ǁŽƵůĚ ǇŽƵ ƌĂŶŬ ƚŚĞ ŝŵƉŽƌƚĂŶĐĞ ŽĨ ĨƌĂƵĚƵůĞŶƚ ƚƌĂĸĐ ĂƐ Ă ƚŽƉŝĐ ŝŶ ǇŽƵƌ ŽƌŐĂŶŝƐĂƟŽŶ͍ ;й ƌĞƐƉŽŶƐĞƐͿ Strategic priority Low priority

^ŝŐŶŝĮĐĂŶƚůǇ ƌĞĚƵĐŝŶŐ Staying the same ^ŝŐŶŝĮĐĂŶƚůǇ ŝŶĐƌĞĂƐŝŶŐ

Marginally or ƐŝŐŶŝĮĐĂŶƚůǇ ŝŶĐƌĞĂƐŝŶŐ

Strategic or top priority

Top priority Same as Business as Usual

ϯϮй

53%

Slightly reducing Marginally increasing

ϯϳй

Ϯϲй

ϭϭй 5%

Investing in fraudulent traffic reduction Carriers continue to advance fraud management capabilities through personnel and technology advancement. Interviews confirm that carriers have been investing in assets to simplify and improve the fraud detection process. Nearly 70% of respondents stated they would increase investment in fraud management infrastructure over the next year and 20% of respondents planned to increase FTE including several experts who stated that they would add FTE to provide 24/7 coverage. The trade off in fraudulent traffic analysis International wholesale carrier networks generate massive amounts of data as every call is routed, a trail and record of the call route is compiled, billing is generated, and accounts receivable are collected. Filtering out the noise to Capacity detect fraud, resolve disputes, limit and reduce losses, and measure the response efficacy are all the ultimate goals of fraud management. Data analysis within fraud management comes down to looking at live call detail records and graphical patterns. Statistical analysis built on those patterns is utilized to construct live alerts either to the fraud management team, or, when appropriate, the customer. The alert to the team would lead to deeper analysis, and the alert to the customer would seek approval to block the specific event. Ideally, this confirmation step would be automated or given by default.

Carriers correlation of importance of fraudulent traffic and organisational behaviour tŚĞƌĞ ǁŽƵůĚ ǇŽƵ ƌĂŶŬ ƚŚĞ ŝŵƉŽƌƚĂŶĐĞ ŽĨ ĨƌĂƵĚƵůĞŶƚ ƚƌĂĸĐ ĂƐ Ă ƚŽƉŝĐ ŝŶ ǇŽƵƌ ŽƌŐĂŶŝƐĂƟŽŶ͍ ;Θ ƌĞƐƉŽŶƐĞƐͿ

Ž ǇŽƵ ŝŶĐůƵĚĞ ĨƌĂƵĚƵůĞŶƚ ƚƌĂĸĐ ŵĞƚƌŝĐƐ ŝŶ ƌĞƉŽƌƟŶŐ ƚŽ ƚŚĞ Kͬ,ĞĂĚ ŽĨ /ŶƚĞƌŶĂƟŽŶĂů ǁŚŽůĞƐĂůĞ͍ ;й ƌĞƐƉŽŶƐĞƐͿ

ϴϯй

ϲϳй

Top priority Strategic priority Sames as business as usual Low priority

,ĂƐ ǇŽƵƌ ĐŽŵƉĂŶǇ ƐŝŐŶĞĚ ƚŚĞ ĐŽĚĞ ŽĨ ĐŽŶĚƵĐƚ͍ϭ ;й ƌĞƐƉŽŶƐĞƐͿ

33% ϭϳй No

Yes

ϴϬй

ϳϬй 30%

ϮϬй Yes

ϲϳй

Yes

Yes ϲϳй

33%

Yes

Notes: 1n=19, respondents without a response were not counted; Source: GLF Survey 2018, Delta Partners Analysis

december/january 2019

NEW LOCATION

LATAM 2019 12 & 13 March, SÃ£o Paulo 11 March Pre-Event: LATAM Peering Forum & Welcome Drinks Reception

L ATIN AMERICA'S L ARGEST WHOLESALE TELECOMS MEE TING 2018 SPONSORS INCLUDED: Diamond sponsor

Platinum sponsor

Capacity

Gold sponsors

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For sponsorship opportunities contact: Lauren Wilcox lauren.wilcox@capacitymedia.com | +44 (0)20 7779 8742

5 - 7 March, Dubai 4 March

Subsea Middle East, The Voice Trading Hall, & Pre-Event Welcome Reception

RACING FOR DIGITAL TRANSFORMATION ACROSS THE REGION The Middle Eastern telecommunications industry is driven by the desire for rapid digital transformation. Middle *FXYJWS TUJWFYTWX \NQQ GJ FRTSL YMJ ‫ܪ‬WXY NS YMJ \TWQI to rollout commercial 5G services, and governmental national strategies such as the UAE Vision 2021, the Saudi Arabia Vision 2030 and the New Kuwait Vision 2035 are driving ambitious new projects. The Internet of Things (IoT) applications will be in numerous Smart Cities across the region as governments look to diversify economies.

9MJ ZXJ TK &WYN‫ܪ‬HNFQ .SYJQQNLJSHJ NX WFUNIQ^ NSHWJFXNSL FSI according to a PwC study, it will contribute to around 13% GDP in the UAE and Saudi Arabia by 2030. The largest carrier event in the Middle East returns on 5 - 7 March 2019, uniting 1,700+ attendees trading voice and data services, with decision makers discussing future trends affecting the wholesale market including IoT, AI, SDN-WAN, 5G and more.

Capacity Middle East provides Orixcom with the platform to showcase this with new technologies such as SD-WAN, delivering cost savings along with ‫ܫ‬J]NGQJ FSI XJHZWJ HTSYWTQ

Capacity Middle East is undoubtedly the most happening event of the telecoms community. I have witnessed results through the event every Capacity year since 2011. With the telecoms world unfolding in an exciting way, I see Capacity Middle East 2019 as a source of greater collaboration, cohesion and cooperation amongst telecom operators, content providers and innovative solutions developers.

Andrew Grenville, CEO, ORIXCOM

Tarique Aslam Qureshi, Deputy General Manager, MULTINET

4 March 2019

SUBSEA MIDDLE EAST CALL FOR PAPERS TO PARTICIPATE IN THE CAPACITY INNOVATION SERIES The Capacity Innovation series offers PJ^ NSIZXYW^ ‫ܪ‬LZWJX IWN[NSL WJ[TQZYNTSFW^ technologies such as AI, VR, IoT and blockchain a platform to present and share their innovations with the global carrier industry.

The Voice Trading Hall, a dedicated meeting area solely for regional players trading voice services, will be hosted all day on 4 March. All Capacity Middle East delegates may attend, however, should you wish to attend the Voice Trading Hall day only, then attendees will be required to pre-register.

Subsea Middle East Summit will return on 4 March as a full-day forum packed with panels and presentations, enabling those with an interest in the regional submarine cable market to network with new and existing partners, whilst hearing from industry leaders on advancing market trends.

To purchase the one-day pass or to secure a meeting table, please email Guy on: guy.mcculloch@capacitymedia.com

All registered Capacity Middle East 2019 delegates are eligible to attend however must RSVP to Frances on: frances.booth@capacitymedia.com

For more information and details on how to apply get in touch with Beth on: beth.evans@capacitymedia.com

To purchase the one-day pass or to secure a meeting table, please email Guy on:

guy.mcculloch@capacitymedia.com

If you wish to receive a copy of the sponsorship packages, please email Guy on:

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Capacity

78 | appointments

Stéphane Richard GSMA Orange Group chairman and CEO Stéphane Richard has been named as the next chair of the GSMA, from January 2019 until December 2020. His appointment came as the GSMA, which represents more than 750 of the world’s mobile operators, unveiled its new 26-member board. This included the naming of Singtel group CEO Chua Sock Koong as deputy chair.In his role of chair, and supported by his deputy, Richard will be tasked with overseeing the strategic direction of the GSMA, which also represents over 350 companies operating in the broader mobile ecosystem. “I am honoured to be elected to serve as chair of the GSMA and look forward to working closely with the rest of the board, the GSMA leadership team and our entire membership to address the critical issues facing our industry and our customers,” said Richard.

Nicolas de Vanssay Kosc Telecom Nicolas de Vanssay, a former executive at Colt Technology Services, has been named as the new chief customer success officer (CCSO) at Kosc Telecom. The French wholesale-only connectivity-as-a-service provider will task de Vanssay, who joined the company in September, with ensuring high standards of customer service, as well as management of its customer service team. De Vanssay was previously director of customer service at Colt for four years, having joined the company in 2000. During his time there, he has held a number of positions including operations director for North America, senior manager of service delivery and service delivery IP configuration manager. He has also held roles at mobile infrastructure firm Sitcom. “We are very happy to welcome Nicolas to our leadership team,” said Antoine Fournier, Kosc CEO.

Jamie Jefferies Ciena

Gary Donnan Eutelsat Former Alcatel executive Gary Donnan has been appointed by Euletsat as its new chief innovation officer. Reporting directly into CEO Rodolphe Belmer, Donnan is tasked with developing the Paris-based satellite company’s innovation strategy, as well as identifying cross-group initiatives aimed at driving innovative new policies. Prior to joining Eutelsat Donnan worked for 11 years at Technicolor across several different positions. During this time, he oversaw a number of large-scale transformation projects, operating in the fields of technology, innovation and research. Before this Donnan served in various different fields for Alcatel including research and development for the deployment of fibre, cable, radio and satellite networks.

Ciena has named Jamie Jefferies as its new vice president and general manager of Europe, Middle East and Africa. An industry veteran with over 30 years’ in the sector, Jefferies will use his regional experience as well as internationally to build upon Ciena’s exciting success in EMEA, while based in Ciena’s London office. One of Jefferies’s most notable achievements at Ciena has been his success while leading the company’s Verizon account. More recently he led the Ciena team that supported Verizon’s One Network initiative, the strategy to consolidate and operate a single seamless network infrastructure. “I’m confident Jamie’s innovative thinking, leadership and vision for the region will help drive our continued success,” said Jason Phipps, Ciena’s senior vice president of sales and marketing.

Capacity

Mugo Kibati Telekom Kenya Telkom Kenya has announced that Mugo Kibati will replace Aldo Mareuse as the company’s new chief executive officer. Kibati joins the company from Sanlam Kenya, where he was group CEO. He has held other senior leadership roles in both the private and public sector, including being the founding director general of Kenya’s Vision 2030 secretariat and serving as group managing director and CEO at East African Cables. Kibati has held non-executive board positions in various institutions and is currently the chair of the board of directors at Lake Turkana Wind Power. “I look forward to working closely with the team,” said Kibati.

Robyn Denholm Tesla Robyn Denholm, CFO of Telstra for only five weeks, is leaving the company to become chair of electric car company Tesla Motors in place of Elon Musk. She will officially remain with Telstra – which she joined in January 2017, firstly as COO – until 6 May 2019. Before Telstra, Denholm was CFO of Juniper Networks in Sunnyvale, California for nine years, having previously spent 11 years as senior VP for strategic planning at Sun Microsystems in Santa Clara. “I believe in this company, I believe in its mission and I look forward to helping Elon and the Tesla team achieve sustainable profitability and drive long-term shareholder value,” she said.

Brian Cox Infomart Data Centers Infomart Data Centers has announced the appointment of Brian Coz as chief executive officer and a member of its board of directors. An industry veteran, Cox succeeds Phil Koen who became interim CEO in June and will stay actively involved in the company as a member of the board of directors. To the role, Cox brings over 20 years of industry and operational experience. He most recently served as chief operating officer at Cologix, a data centre and interconnection solutions provider. Prior to this, he served as chief financial officer at Cologix. “Finding a CEO with a proven track record of growing a company in this space and creating shareholder value was of critical importance to Infomart’s board,” said Koen.

Cengiz Oztelcan GBI Gulf Bridge International (GBI) has named Cengiz Oztelcan as its new chief executive officer. Oztelcan is a 23-year industry veteran, having held senior management roles in sales, marketing and corporate development in telecoms and IT. Oztelcan was CEO at Linxa and has sat on the board of governors for the Pacific Telecoms Council for over two years. He spent almost four years as CEO at Türk Telekom International, where he also served as chief marketing and sales officer. He has also worked for the Türk Telekom group and has held roles with Intel and Boeing. He replaces Amr Eid who is said to be “still in transition within GBI”.

Tell us your move

Capacity is keen to hear from readers about new roles and appointments in the industry. Send details to james.pearce@capacitymedia.com, with a high-resolution picture

december/january 2019

Capacity

80 | innovation report: OTTs

POWER MOVES TO THE OTTS IN PICKING THE PATH FOR INNOVATION WHO CHOOSES THE DIRECTION OF THE TELECOMS INDUSTRYâ&#x20AC;&#x2122;S INNOVATION? INCREASINGLY THE OTT COMPANIES, LED BY FACEBOOK, ARE STEERING TELCOS IN THE WAY THEY WANT, WRITES Ç§ . AND THE TELCOS ARE ACCEPTING THAT THE POWER HAS MOVED TO THEIR GIANT CUSTOMERS

hoâ&#x20AC;&#x2122;s doing the innovation in this industry of ours? Whoâ&#x20AC;&#x2122;s driving the development of new services? The answer used to be, without a shadow of a doubt, that it was telecoms service providers and their specialist hardware companies. The telcos had the labs and told the vendors what they wanted. Sometimes they also made the kit for themselves or they passed the designs on to their favourite suppliers. But weâ&#x20AC;&#x2122;ve seen a dramatic change in the industry over the last few years. The customers have taken over the store. In other words, the over-the-top (OTT) companies, having parked themselves on the industryâ&#x20AC;&#x2122;s infrastructure, are now taking a key role in designing its future by directing research and development. Itâ&#x20AC;&#x2122;s a powerful riposte to those arguments from the venerable telcos who used to grumble about the OTTs scooping up the revenue by delivering the services but making little or no investment into the industryâ&#x20AC;&#x2122;s infrastructure. But it also shows how the power has shifted in the industry in a relatively short time, from the traditional suppliers of infrastructure to the most adventurous corporate users â&#x20AC;&#x201C; companies such as Amazon, Facebook, Google and Microsoft. Of course, the classic telcos still carry out and pay for a lot of research â&#x20AC;&#x201C; companies such as BT, NTT, Orange and TelefĂłnica still have their own labs. The old AT&T, the AT&T that was split up in 1984, had Bell Labs, winner of more Nobel Prizes than most countries. Bell Labs still exists, though now itâ&#x20AC;&#x2122;s part of Nokia, which still spends money on research, as do Ericsson, Huawei, Samsung and others. Theyâ&#x20AC;&#x2122;re all pushing 5G development, and the next generation of mobile should create a whole new range of services that will drive growth in telecoms. Six years ago a group of powerful telcos approached the European Telecommuni-

cations Standards Institute (ETSI) in France with a commission to define network functions virtualisation (NFV). One reason for that work was that operators were becoming steadily unhappier with their vendors. They could see where banks, hospitals, air traffic control, the military and public services were buying their digital systems from. Not from a specialist group of hardware Capacity vendors that said they were special, but from IT companies producing generalpurpose hardware, with the addition of clever new software. And so we have NFV and software-defined networks (SDNs), with the potential to revolutionise the industry. On top of that, however, we have the Telecom Infra Project (TIP), with a â&#x20AC;&#x153;collective aim â&#x20AC;Ś to collaborate on building new technologies, examining new business approaches, and spurring investment in the telecom spaceâ&#x20AC;?. Much of it is done by telcos you and I have all heard of â&#x20AC;&#x201C; Bharti Airtel, BT, Deutsche Telekom, Orange, Reliance Jio, TelefĂłnica, TIM and Vodafone, for example. But thereâ&#x20AC;&#x2122;s a difference: TIP was founded by a company even more of us, around the world, have heard of: Facebook, a network with two and a quarter billion active users. The population of the world, aged 15 or over, is around 5.3 billion, so nearly half of the adults in the world have used Facebook in the past 30 days â&#x20AC;&#x201C; thatâ&#x20AC;&#x2122;s the accepted definition of â&#x20AC;&#x153;active usersâ&#x20AC;?. And, remember, itâ&#x20AC;&#x2122;s been going for only a decade. So itâ&#x20AC;&#x2122;s no wonder that Facebook and the other OTT companies should look at the sort of infrastructure that the telecoms industry has been offering them and say, no, actually we want it a different way. Itâ&#x20AC;&#x2122;s consumer power of a sort: the OTTs know what they want, and theyâ&#x20AC;&#x2122;re telling the telecoms industry what that is. Thatâ&#x20AC;&#x2122;s not to say that telcos have been excluded from the discussion. Anything

but. At the third TIP summit, which took place in mid-October in London, senior executives of the telecoms industry were there in force. The TIP organisation is chaired by Axel Clauberg, who is vicepresident of technology innovation at Deutsche Telekom. The executive director of TIP is Attilio Zani, who spent 12 years at the GSMA, whose whole purpose is to defend its mobile-operator members. Other telecoms people â&#x20AC;&#x201C; mainly from the innovation and technology side â&#x20AC;&#x201C; spoke at the summit, including Matt Beal from Vodafone, David del Val Latorre of TelefĂłnica, Babak Fouladi from MTN, Lucy Lombardi from TIM and Howard Watson from BT. And there were lots and lots of Facebook people. We all know, those of us who have spent lots of time at telecoms conferences, that the real business is not always whatâ&#x20AC;&#x2122;s delivered from the podium and the PowerPoint presentation, but the conversations that take place over coffee and croissants in the morning and something stronger at the end of the day. So what is TIP focusing on? What are the priorities for this Facebook-led community of telecoms geeks? The organisation is clear that a number of project groups have now led to trials with operators around the world. These are: millimetre wave networks; open optical packet transport; OpenCellular; OpenRAN (open radio access network); and vRAN (virtual radio access network) fronthaul. At the same time, the first of these is now the subject of a spectrum auction in the US. TIP is not diverting the industry away from its course, but focusing its mind on getting to where it collectively needs to go. Meanwhile, Deutsche Telekom, TelefĂłnica and Vodafone have started processes to investigate how they can adopt TIP technologies. In two years, TIP has positioned itself at the forefront of telecoms innovation. august/september 2018

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