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Big interview Equinix CEO Charles Meyers speaks to Capacity about the company’s digital competitive edge Feature Carrier vs OTT - the best of frenemies
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editor’s letter | 03
Exciting times ahead!
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he biggest issue of the year is now here and coincides with International Telecoms Week (ITW) 2019, the biggest event on the wholesale telecoms calendar. The data centre and cloud market is experiencing a massive data onslaught, thanks in part to the increasing uptake in content, the proliferation of the digital edge and the transformation of our sector, which is accelarating exponentially. Our June/July issue has been a labour of love for our editorial team, cultivating interviews from the likes of Equinix CEO Charles Meyers (pages 30-31), Marc Ganzi, CEO of Digital Bridge (pages 40-41), AWS’ Jean-Philippe Poirault (pages 78-80) and Yeming Wang, general manager of Alibaba Cloud EMEA (pages 84-85), to name a few. As for features, Capacity examines the tumultuous love-hate relationship between carriers and OTTs, aka ‘frenemies’ (pages 32-33), an overview of the accelerating M&A activity in the data centre market (pages 62-63) and with the ever-growing adoption of the cloud, we chart the roadmap to multi-cloud environments (pages 82-83). Ahead of Subsea EMEA, taking place in Marseille 8-10 July, we speak to the Bulk Infrastructure CEO, Jon Gravråk, about the growing opportunities in the Nordics. Also in celebration of the inaugural Communications Infrastructure Summit, colocated on the last day of ITW, we’ve included a feature preview of the event discussing how the industry as a whole is coming together in preparation for 5G. All in all, it’s exciting times ahead for us here at Capacity. Nominations for the 2019 Global Carrier Awards have now opened with the awards ceremony taking place on October 30 at our new venue: indigo at The O2. Additionally, we are pleased to announce the launch of the Global Women in Telco & Tech Summit and Awards. This one-day conference, full of discussions and panels around gender parity in our industry, will be followed by an evening of Capacity celebration to recognise companies and individuals championing gender diversity. Also, one for your diaries, our August/September magazine issue will feature special reports on Global Women in Telco & Tech and satellite communications, so if you’d like to get involved – get in touch with myself or the team!
Jason McGee-Abe Editor-in-Chief, Capacity Media
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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 August/September 2019 Published on 16 August 2019 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
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) www.capacitymedia.com Capacity (ISSN 1471-762X) is published six times a year by TelCap. © TelCap, 2019. 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 | north america
DIGITAL COLONY AND EQT TO ACQUIRE ZAYO FOR $14.3BN
Dan Caruso, Zayo’s Chairman and CEO
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arc Ganzi’s Digital Colony and EQT Infrastructure IV fund has agreed to buy fibre network owner Zayo Group Holdings for $14.3 billion including debt. The deal will transition Zayo from a public company to a private company while the Zay team continue to lead the company forward, base in Boulder, Colorado. “Digital Colony and EQT share
our vision that Zayo’s Fibre Fuels Global Innovation, “said Dan Caruso, Zayo’s Chairman and CEO. “Both are experienced global investors in the communications infrastructure space, and they appreciate our extraordinary fibre infrastructure assets, our highly talented team and our strong customer base. I am confident this partnership with EQT and Digital Colony will empower Zayo to accelerate its growth and strengthen its industry leadership.” Under the terms of the agreement, Zayo’s shareholders will receive $35 in cash per share of common stock in a transaction valued at $14.5 billion. Additionally, the deal represents a 32% premium to the volume-weighted price average of the last six months of $26.44. “We are excited by the opportunity to team up with Zayo, in a transaction reflecting EQT’s commitment to investing in market leading infrastructure companies whose innovations and services are transforming society,” said Jan Vesely, Capacity partner at EQT Partners and investment
advisor to EQT Infrastructure. “As one of the most active global infrastructure investors with a demonstrated track record of success in the telecommunications and fibre industry, we are confident that EQT, along with Digital Colony, are ideal partners for Zayo as the company embarks on its next phase of growth. We look forward to working closely with Zayo’s global team, whose entrepreneurship, collaboration and customer partnerships are best in class.” “Zayo has a world-class digital infrastructure portfolio, including a highlydense fibre network in some of the world’s most important metro markets,” said Marc Ganzi, managing partner of Digital Colony. “We believe the company has a unique opportunity to meet the growing demand for data associated with the connectivity and backhaul requirements of a range of customers.” The deal is expected to close in the first half of 2020 subject to customary conditions, which include regulatory and Zayo shareholder approvals.
FLEXENTIAL COMPLETES 70,000 SQ FT DATA ATLANTA CENTRE EXPANSION Flexential has completed a 70,000 sq ft expansion of its Atlanta colocation facility in order to better serve the fast-growing financial technology industry. The expansion is the largest to take place in Atlanta this year, bringing Flexential’s national data centre footprint to 3.1 million sq ft and underscores the company’s commitment to providing top tier data centre solutions to customers in financial services, technology and data intensive industries.
“Companies are experiencing a data tsunami, with an increased need to store, process and access data securely, efficiently and strategically,” said Mike Fuhrman, chief product officer at Flexential. “Atlanta is a perfect example of a market with exponentially growing demand for secure, enterprise-grade, cost-effective, and resilient data management solutions.” Atlanta and its neighbouring Transaction Alley are the third-largest fintech hub in the US with more than 70% of all credit
card transactions processed through the Atlanta metropolitan area, according to Atlanta Small Business Network data. These data-intensive companies need secure, reliable, and scalable means to gain access and transport the data without loss of connectivity. This demand for data management and IT strategy solutions means that the new Flexential expansion increases the company’s capacity in Georgia to more than 8MW of power and a total of 175,000 sq ft.
NEWS IN BRIEF MEF has completed its final draft standard for SD-WAN service alongside its various attributes and it will be officially published by mid-July 2019. Amazon has officially thrown its hat into the space business. Project Kuiper will launch over 3,236 low-earth orbit satellites to offer high-speed, low latency broadband services. Operators believe that cloud
gaming could represent 25% to 50% of 5G data traffic by 2022, based on the rapid progression of cloud gaming services in recent months. HAPSMobile, owned by SoftBank, and Alphabet-owned Loon have put $250 million into a company that plans to deliver wholesale internet access from balloons and uncrewed aircraft. Telefónica Group’s infrastructure company Telxius will use Radware,
a data centre security company, to ensure the protection of its international network. Limelight Networks has opened its 100th point of presence (PoP) as its global CDN capacity increases by 40% to 42Tbps. Tata Communications, Cisco extend their partnership to allow enterprises to transform their legacy network to a multi-cloud native hybrid network.
june/july 2019
north america | 05
AMS-IX, EPSILON INK INFRASTRUCTURE OUTSOURCING DEAL Amsterdam Internet Exchange (AMS-IX) has selected Epsilon to provide AMS-IX with infrastructure outsourcing services for its Bay Area and Chicago Internet Exchanges (IXs). The agreement will enable AMS-IX to focus to its core business activities while benefiting from the scalability and efficiency of a virtual infrastructure model. “We are excited to expand our relationship with AMS-IX and help it to deliver a flexible, scalable and sustainable peering environment for its peering partners in North America,” said Jerzy Szlosarek, CEO at Epsilon. “Epsilon has its roots in infrastructure and connectivity service management and we’re proud to be solving networking challenges for AMS-IX and creating new value for its partners. We are big supporters of peering globally and our neutral approach is enabling IXPs across the globe to benefit from remote peering and new connectivity models.” Epsilon provides on-demands access to AMS-IX IXPs worldwide via its software-
defined networking (SDN) platform Infiny and is a partner in AMS-IX’s EasyAccess programme.
Jerzy Szlosarek, CEO, Epsilon
Capacity
CENTURYLINK EXPANDS GOOGLE CLOUD PARTNERSHIP FOR INCREASED CLOUD AGILITY
Carolee Gearhart, vice president of worldwide channel sales, Google Cloud
CenturyLink has expanded its partnership with Google Cloud to help drive digital transformation for companies. The partnership will enable CenturyLink to combine Google Cloud Platform (GCP) with CenturyLink IT consulting services. “Our work with CenturyLink is a prime example of our fast-growing cloud ecosystem and Google Cloud’s commitment to support the technology needs of enterprises today,” said Carolee Gearhart, vice president of worldwide channel sales at Google Cloud. “We look forward to continuing to expand our partnership with CenturyLink, capacitymedia.com
which brings a wealth of expertise in SAP consulting, big data analytics and secure private networking to public and hybrid cloud workloads.” As part of the Google Cloud partner programme, CenturyLink will provide implementation, sales and technical support to enterprises as they develop cloud solutions. The news comes nearly a year after CenturyLink confirmed that it would connect customers to Google Cloud Partner Interconnect. CenturyLink only recently announced that its global broadcast fibre network, Vyvx Cloud Connect, provides access to GCP by offering multi-site, diverse connectivity paths into GCP for highbandwidth, high-quality video feeds. “This partnership enables global enterprises to leverage the power of CenturyLink’s diverse global network combined with our innovative thought leadership in optimising application deployment and advanced IT services that help meet the full range of their hybrid cloud needs,” said Mahesh Dalvi, vice president of global it solutions and managed services at CenturyLink. “Both Google Cloud and CenturyLink are highly focused on tackling complex enterprise needs, including the optimisation of critical workloads such as SAP and big data.”
VAPOR IO, CROWN CASTLE BRING AWS TO THE KINETIC EDGE Vapor IO and Crown Castle have jointly developed a service that seamlessly interconnects Vapor IO’s Kinetic Edge with Amazon Web Services (AWS) via Crown Castle’s high-speed Cloud Connect. Technology integration and direct fibre will unlock new classes of applications, with this service enabling a new class of mobile and wireless edge applications that span the continuum from edge to core. Customers of Vapor IO’s Kinetic Edge can build applications on AWS that directly interact with Vapor IO’s towerconnected data centres at the edge of the cellular wireless network, via Crown Castle’s dedicated high-speed fibre link. This will allow developers to build wireless and mobile edge applications that can reduce network costs, increase bandwidth throughput, and rely on a more consistent network experience than internet-based connections. “Over the past two years, we’ve been working very closely with Vapor IO to build out their Kinetic Edge using our real estate and fibre assets in many US cities,” said Phil Olivero, VP of technology at Crown Castle. “Chicago, the world’s first Kinetic Edge city, proved to be the ideal location for us to connect the Kinetic Edge directly to AWS. As Vapor IO rolls out the Kinetic Edge to new cities, we plan to extend our Cloud Connect to also connect to AWS in those locations. This will empower our mutual customers to build high-performance edge-enabled mobile applications using AWS.” Crown Castle offers one of the largest fibre footprints in the US and has been an early pioneer in edge infrastructure, providing the fibre backbone that supports much of Vapor IO’s Kinetic Edge, including backhaul to key internet exchange points (IXPs).
Phil Olivero, VP of technology, Crown Castle
06 | north america
$3BN BIDDERS LINE UP FOR SPRINT BRAND AS DOJ WANTS TO CREATE FOURTH CARRIER The US government wants Sprint and T-Mobile US to carve out a new mobile company as part of the conditions for approval of their $26 billion merger. According to reports, the Department of Justice (DoJ) wants them to spin off a new fourth company with its own infrastructure – a model very similar to that adopted in Italy when French company Iliad came into the market as a condition for approval of the merger of Veon’s Wind and CK Hutchison’s Tre (Three). As we go to print, Bloomberg is reporting that “people with knowledge of the discussions, who asked not to be identified because the talks are private” say the DoJ wants there to be four carriers in the US mobile market. Sprint, controlled
by SoftBank of Japan, and T-Mobile US, controlled by Deutsche Telekom of Germany, argue that a merger will create a strong third competitor in the market behind AT&T and Verizon. The Federal Communications Commission (FCC) has already approved the merger, having won guarantees that the merged company, which will retain the name T-Mobile, will build a 5G network that would cover 97% of the US population within three years, including 85% of the rural population. And it would cover 99% of the US population within six years and 90% of the rural population. Sprint has already agreed to sell its Boost Mobile subsidiary, possibly with spectrum, before the merger with T-Mobile is
BLUEBIRD NETWORK PARTNERS MEGAPORT FOR PRIVATE CLOUD ACCESS
UFD ROLLS OUT NYC TO ASHBURN FIBRE-OPTIC NETWORK
Bluebird Network has partnered with Megaport to enable private access to cloud providers such as AWS, Microsoft Azure, Google Cloud, Oracle Cloud, Alibaba Cloud, IBM Cloud, Nutanix and Salesforce. Through the partnership, customers of Bluebird Network and the Bluebird underground data centre, the company’s colocation facility in Springfield, Missouri, will have connectivity to each of the top tier cloud computing and as-aservice providers. “Our partnership with Megaport provides both our data centre and network customers with additional resources to support their business-critical operations; allowing for dedicated, secure, and scalable connections to the cloud,” said Michael Morey, president and CEO of Bluebird Network. “Bluebird assures the same focus on providing high-quality fibre service to rural areas while enabling access to Megaport connectivity to a wide array of diverse cloud service providers.” Leveraging Megaport’s softwaredefined network (SDN), Bluebird will directly support customer connections to the destination of their choice, which includes over 300 service providers within the Megoport ecosystem. In addition, using the Megaport Cloud Router (MCR), Bluebird can enable cloud-tocloud connectivity directly between cloud service providers and manage IP routing capabilities for customers.
United Fiber & Data (UFD) has completed its fibre-optic network, which Capacity connects the US cities of New York to Ashburn, Virginia. The network is now live and ready for service connecting UFD’s 13-mile metro ring in NYC to ‘data centre alley’ in Ashburn, Virginia. It is joined via a 340-mile, physically divers long-haul route and leveraging a high-capacity, low latency path, provides redundancy for data transit.
complete. Reports from the US say bidders are prepared to pay $3 billion. One of the potential bidders, named by Reuters, is Q Link Wireless. Its CEO, Issa Asad told Reuters that it is working with private equity partners to put together a bid of $1.8 billion to $3 billion. Stephen Stokols, CEO of FreedomPop, another prepaid operator, told the agency that “an undisclosed private equity group he is speaking with have placed Boost’s future value at about $4 billion”, though that depends on a future share offer. Three years ago Russian investor LetterOne, a major shareholder in Veon, invested $50 million in Freedom Pop. The decision maker in the DoJ is Makan Delrahim, who is head of its antitrust operations.
“We’re thrilled to unveil this new fibre network, which offers a superior alternative along the popular New York City to Ashburn route,” said Bill Hynes, founder and CEO of United Fiber & Data. “With UFD’s fibre, customers can achieve the redundancy required by modern-day networks with a secure pathway that can provide support for leading-edge optical gear while maintaining low latency.”
TELXIUS TO ESTABLISH PRESENCE IN PHOENIXNAP DATA CENTRE Telxius has announced plans to deploy a presence in the phoenixNAP data centre in Phoenix, Arizona. The launch of this presence will give phoenixNAP clients access to Telxius’ Tier 1 IP network, while in turn benefit from additional interconnectivity points to its global network. “We are looking forward to working with phoenixNAP and unveiling new opportunities in the local market,” added Enrique Valdés, VP of sales, northern region, at Telxius. “phoenixNAP offers us resources to establish our presence in an area that is strategic for us in order to better serve the US West Coast and Latin America as well as adding new points of presence to our global network of advanced IP, capacity and colocation services. We will closely work with their expert staff on promoting new interconnection opportunities,
network security, and data centre resilience incorporating subsea enablement.”
Enrique Valdés, VP of sales, northern region, at Telxius
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10 | latam
DIGITAL REALTY, ASCENTY TO BUILD INAUGURAL DATA CENTRE
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William Stein, CEO, Digital Realty
igital Realty and Ascenty will build a new data centre in Santiago, Chile, after signing a long-term, multi-megawatt agreement. The new facility, which is scheduled to open in 2020, is expected to deliver up to 6.3MW of total IT capacity. It will be connected via an underground dark fibre network to facilitate interconnection between the data centre, critical networks, cloud, and connectivity providers in a single, secure environment. “We are pleased to support the growth of a strategic customer as they expand into a new market,” said William Stein, chief executive officer of Digital Realty. “Chile is one of Latin America’s most
developed countries, with the highest GDP per capita in Latin America, and we are well-positioned to power our customers’ digital ambitions in a region poised for rapid growth.” Chris Torto, chief executive officer of Ascenty, added: “This is a very important milestone in our expansion as the leading provider of data centre solutions in the region of Latin America. “Chile is positioned to emerge as a leading technology hub in the region, and the development of our first facility in the country will enhance our ability to meet the growing customer demand for comprehensive data centre and colocation solutions in Latin America.”
TELEFÓNICA AND AMDOCS EXTEND MULTI-YEAR PARTNERSHIP Amdocs and Telefónica have announced a multi-year extension and expansion of their strategic partnership. The partnership will help advance Telefónica’s digital transformation initiatives in Argentina and Chile with an expanded portfolio of support services aimed at accelerating Telefónica’s digitalisation and modernisation journey. “We are pleased to extend our strategic partnership with Amdocs as Telefónica focuses on its ultimate goal of providing excellence in customer satisfaction with a highly secure and unified customer
experience,” said Enrique Blanco, global CTIO of Telefónica. “This partnership supports our digital transformation and Capacity operations while our focus on automating allowing us to advance in the development of new capabilities by leveraging the use of APIs to speed delivery of innovative and relevant new offerings to our customers.” Telefónica launched a fully modernised multi-play platform in Argentina to support over 25 million customers of mobile, pre and post-paid, broadband, fixed line, TV and OTT services. In addition, Telefónica Chile plans to
provide on top of 9 million mobile customers with OTT and wireline services for their B2C and B2B customer base during 2020. “Amdocs is supporting Telefónica’s strategy of providing excellent connectivity to its customers everywhere by accelerating the company’s digital transformation and providing its customers with a seamless multi-play experience,” said Gary Miles, chief marketing officer, Amdocs. “We are proud to expand our partnership with this leading global player.”
SEABORN PARTNERS WITH CLOUDSMARTZ Seaborn Networks has selected CloudSmartz, a software solutions provider for communications service providers, to deliver its digital transformation strategy and deployment. The companies will develop and deploy a fully integrated customer portal solution to automate Seaborn’s frontoffice processes, which will bring more efficiency to their sales, operations, inventory and service provisioning cycles, as well as providing real-time visibility onto the service delivery functions across the business. Additionally, the platform will also enable on-demand SDN services and deliver bandwidth in near real-time delivery. Seaborn is the owner and operator of the Seabras-1, the submarine communications cable between Brazil and the US.
The portal can allow customers to provision and amend Seabras-1 services in real-time, enter service queries and get updates on tickets, as well as a detailed list of all their Seabras-1 services, usage and billing status. Larry Schwartz, CEO of Seaborn, said: “CloudSmartz leadership has a strong understanding of the complexities of our network and customer demands – and a long history of executing.” The collaboration will make Seaborn the first in the Americas region to offer an SDN delivery platform for enhanced IP, cloud and transport services. Customers can use the portal to provision and amend Seabras-1 services in real-time, enter service queries and get updates on tickets, as well as a detailed list of all their Seabras-1 services, usage and billing status.
Larry Schwartz, CEO, Seaborn
june/july 2019
latam | 11
GOOGLE COMPLETES CURIE CABLE Google has completed its 10,000km Curie cable project, which now makes the data pipe the largest single connection to Chile. SubCom was awarded the contract to build Google’s new system back in 2018. SubCom Durable, the SubCom’s cable ship, delivered the line to Las Torpederas beach in Valparaíso, Chile. “The Google Network is a critical part of our infrastructure, enabling us to process vast amounts of information in real time, to accommodate some of the services most demanding in the world and to deliver content to the highest levels of availability and efficiency,” said Jayne Stowell, strategic negotiator at Global Infrastructure at Google. The four-fibre pair system, named after physicist and chemist Marie Curie, will connect Chile to Los Angeles in the US, with a branching unit for future connectivity to Panama. The cable deployment makes Google the first content player to build a private intercontinental cable. It is also the first new cable to connect with Chile in
OI REPORTS QUARTERLY PROFIT MONTHS AFTER RESTRUCTURE
Los Angeles to Valparaiso: Curie connects Chile and the US
almost 20 years. Chris Carobene, vice president of marine services and network construction at SubCom, commented: “The ongoing teamwork between Google and SubCom allowed mitigating the potential risks to the Curie cable system project schedule, which in turn allowed the early completion of the cable landing in Valparaíso. We hope to continue this collaboration in future projects.” Google is also investing in the Havfrue and Hong Kong-Guam cables.
Capacity
Brazilian operator Oi made a quarterly profit of $170 million after its bankruptcy reorganisation. Revenue fell 9.5% in Q1, 2019, compared with the same period in 2018, the company said, blaming “fierce competition in the residential segment, fewer business days in the first quarter this year – which had an impact on prepaid revenues – and the still slow recovery in the corporate segment”. Oi went into bankruptcy protection in 2016 with debts of $19 billion. Most of the money was owned to banks and to the regular, Anatel. In its Q1 report, Oi said the decline in net revenues was mainly due to a reduction in the market for fixed line and copper broadband. Oi has accelerated its fibre expansion plan and is planning to expand the availability of fibre-to-the-home (FTTH) “at an average cost 30% lower than the traditional approach and more commercially efficient, meeting the market demand”.
12 | q&a: hector alonso
CENTURYLINK & THE DIGITAL BUSINESS MODEL
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t the start of 2019, CenturyLink completed constructing its new data centre in Santiago, Chile. Speaking to Hector Alonso, regional president, CenturyLink - Latin America, about the key drivers of building this piece of infrastructure, he says that it is to support the companies growing data centre and managed services business in the region. “Our data centre and managed services business is growing in Latin America, and Chile is a very important market, with services in high demand,” he says. The new Chilean data centre joins CenturyLink’s 18 other data centres in Latin America, including a new data centre in Quito, Ecuador and the newly expanded Rio de Janeiro facility. “All these actions are totally aligned to support the digital business model for connecting customers, suppliers, partners and stakeholders at all times, anywhere in the world,” explains Alonso. “Being a data-driven digital businesses means
organisations must become laser focused on their data lifecycle – how they acquire the data, how they analyse the data, and how they act on those insights.” Interestingly the surge in data centre deployments is not directly linked to the company’s subsea cable projects, instead Alonso says it’s linked to the development of local business and supports CenturyLink’s ongoing metro network projects and growth in Chile. “Having more space not only allows us to increase the data centre business but also gives us more data capacity or existing and new customers, thus enhancing regional and global business,” says Alonso. From a regional perspective Alonso sees a new business model developing. Businesses are growing so rapidly because of the global trend of connected things, all generating massive amounts of data; combined with the fact that the rate of growth of thisCapacity data is not set to slow down any time soon. “These trends are pushing our customers to acquire more hybrid and convergent services that transit the wide area network (WAN) and must respond quickly to traffic demands,” he explains. “They need to manage the performance of their applications while controlling risk.” In response to this, the company is deploying Hybrid WAN and SD-WAN in LATAM in addition to the launch of Managed Bandwidth and Fast Cloud Connect to take advantage of the demand for migration to the cloud. Alonso also highlights other trends. There will be a continued surge in Internet traffic, driven mostly by video, games, virtual reality, IoT and artificial
intelligence, which is why the company will continue to expand its network to reach more cities with online access as well as consolidating its security offering. From a global and local perspective, Alonso says that CenturyLink is facing the largest online content consumption growth through the diversity of OTT and content platforms. “In this context the content providers are being challenged trying to reach a global audience, with extraordinary performance and supporting all the connected devices, in the most secure way,” he says. CenturyLink’s global CDN has more than 100 points of presence (PoPs) connected to its IP Backbone. This supports the growth of their OTT platforms, supplying an advanced control end-to-end, wherever it is necessary to deliver the content for the end user. “With CDN, the content providers know that they can reach the customers’ expectations, no matter where they are or what they choose to watch,” adds Alonso. For their wholesale customers, “our focus is to support their business with the level of scale and global coverage they need,” he says. As we approach the half-year mark for 2019, Alonso shares CenturyLink’s strategic priorities in Latin America for the rest of the year. “We´ll continue to improve our global, regional and local value proposition and support. We connect organisations to their customers and enable the delivery of critical applications and cloud infrastructure with built-in security – all to ensure greater success in helping you achieve your digital business goals.”
MEXICO CONNECT 10 & 11 September 2019, Mexico City UNITING KEY MEXICAN AND INTERNATIONAL LEADERS TO DISCUSS NEW GROWTH OPPORTUNITIES AND ADVANCE DIGITAL TRANSFORMATION
www.capacitymedia.com/events/mexico-connect
Capacity
14 | europe
DEUTSCHE TELEKOM AND ERICSSON ACHIEVE 100GBPS OVER MICROWAVE LINK
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eutsche Telekom and Ericsson have achieved data transmission rates of 100Gbps in a trial microwave link over a distance of 1.5km. The trials were carried out at the Deutsche Telekom Service Center in Athens, and represents an industry milestone, achieving more than 10 times faster throughout speeds than the current commercial solutions available on similar 70/80GHz millimetre wave spectrum. “Advanced backhaul solutions will be needed to support high data throughput
Alex Jinsung Choi, SVP strategy & technology innovation, Deutsche Telekom
and enhanced customer experience in the 5G era,” said Alex Jinsung Choi, SVP strategy & technology innovation, Deutsche Telekom. “This milestone confirms the feasibility of microwave over millimetre wave spectrum as an important extension of our portfolio of high capacity, high-performance transport options for the 5G era. In addition, it represents a game changing solution for future front hauling capabilities.” In addition to demonstrating the potential of microwave technology as a 5G backhaul and fronthaul solution, the results of the trial also showcased the importance of applying spectral efficient techniques such as multiple input, multiple output (MIMO) on wireless backhaul technologies to address upcoming 5G radio access demands. “This trial signifies the successful establishment of true fibre capacities over the air using microwave,” added Per Narvinger,Capacity head of product area networks, Ericsson. “This means that microwave will be even more relevant for communications service providers in creating redundant networks as a backup for fibre, or as a way of closing a fibre ring when fibre is not a viable solution. By carrying such high capacities, microwave further establishes itself as a key transport technology, capable of delivering the performance requirements of 5G.” During the mid-April trial, transmission rates measured were consistently above 100Gbps, with availability higher than 99.995%, with peak rates reaching 140Gbps.
EQT ACQUIRES MALTESE TELCO MELITA Scandinavian-based private equity group EQT has signed an agreement to acquire Maltese telecommunications operator Melita from Apax Partners and Fortino Capital. “EQT has been built on a passion for developing companies. We invest in good companies across the globe with the aim of turning them not only into great companies but also sustainable ones,” said Ulrich Köllensperger, partner at EQT Partners and investment advisor to EQT Infrastructure IV. EQT’s global infrastructure IV fund signed the deal. It recently agreed alongside Marc Ganzi’s Digital Colony to buy fibre network owner Zayo Group Holdings for $14.3 billion including debt. “This is exactly the formula we aim to apply to Melita, which is already an innovator in the Maltese market and beyond in terms of infrastructure, products and customer service. We are confident that the coming months and years will be exciting and rewarding both for Melita’s employees and for its customers,” added Köllensperger.
Maltese telco Melita will be acquired by investment firm EQT
EIR PARTNERS KN CIRCET TO BUILD OUT FTTH NETWORK IN IRELAND Eir has entered into a deal with KN Circet to build the Optical Distribution Network (ODN) in preparation for the rollout of high speed broadband to 1.4 million premises. Under the terms of the agreement, KN Circet will be responsible for the endto-end rollout of eir’s network, which includes every town in Ireland and over 1,000 premises. The network will deliver up to 10Gbps in broadband speeds. “I am delighted to partner with KN Circet on the roll-out of eir’s urban FTTH network, as part of our €1 billion capital investment programme over the next five
years,” said Carolan Lennon, CEO of eir. “KN Circet has been a major partner to eir for over 12 years and in that time we have developed a close working relationship. It has been a major contractor on the rollout of eir’s rural FTTH network, which by June of this year will have passed over 335,000 premises. “With the signing of this agreement, I’m confident that together, we will successfully deliver Ireland’s best urban FTTH network for the benefit of all our customers.” The deal forms part of eir’s €500m fixed network investment programme, which aims to provide high-speed fibre-to-the-
home services across Ireland. “KN Circet has been a leading provider to the telecommunications, transport infrastructure and power sectors in Ireland, the UK and internationally, since 1975,” added Donagh Kelly, deputy CEO of KN Circet. “We have worked closely with eir for many years and I’m delighted that we will now partner with them on the urban FTTH roll-out, especially given our recent merger with Circet, France’s leading telecommunications services company, which gives us even greater scope to provide best-in-class services to the telecoms industry in Ireland.” june/july 2019
Capacity
16 | europe
TELIA CARRIER EXPANDS CLOUD CONNECT TO SUPERNAP DATA CENTRE
Philip Tohme, CEO, SUPERNAP
Telia Carrier has launched a new Cloud Connect point of presence (PoP) in the SUPERNAP Italia data centre near Milan Italy. Telia’s Cloud Connect service allows customers to connect directly to cloud service providers such as AWS, Google Cloud, Microsoft Azure and IBM Cloud across Telia Carrier’s global network. “The SUPERNAP data centre is an ideal location for our Milan PoP,” said Davide
Binaghi, managing director at Telia Carrier Italy. “The facility’s unparalleled resiliency, reliability and security matches the commitment we have to our own infrastructure. We believe its customer base will greatly benefit from Telia Carrier’s Cloud Connect service and we are excited to work with them.” Cloud Connect enables businesses to connect directly to the Telia Carrier fibre backbone, and accelerate cloud services connectivity around the world. With multiple redundant and geographically diverse connections to the major clouds and the security of dedicated MEF CE2.0 certified Ethernet circuits. “Telia has been a carrier at our data centre since it opened and is a valued member of our Ecosystem, which enables our customers to innovate and grow their businesses,” added Philip Tohme, CEO, SUPERNAP Italia. “We are pleased to collaborate with Telia to enhance our multi-cloud connect offering and provide our clients a secure, reliable and affordable solution for direct cloud connection in our hyper-scalable environment.”
Capacity
EPSILON BECOMES AWS DIRECT CONNECT AUTHORISED Epsilon has achieved the AWS Service Delivery designation for AWS Direct Connect. This accreditation acknowledges that that Epsilon is authorised to provision AWS Direct Connect Hosted Connections capabilities greater than 500Mbps. “Becoming an AWS Direct Connect Service Delivery Partner is a milestone in our Cloud enablement strategy and demonstrates our team’s expertise in developing and delivering Cloud-centric solutions,” said Jerzy Szlosarek, CEO at Epsilon. “We are providing simple, seamless and secure connectivity to the Cloud and our work with AWS is creating tremendous value for our service provider and enterprise customers.” Achieving the AWS Direct Connect Service Delivery designation separates Epsilon as an AWS Partner Network (APN) member that provides specialised demonstrated technical proficiency and proven customer success in delivering AWS Direct Connect services. Partners must possess deep AWS expertise and deliver solutions seamlessly on AWS.
FRANCE-IX LAUNCHES PASS INTERCONNECTION SERVICE
BSO ACQUIRES IX REACH
France-IX launched its Peering-as-aSupplementary Service (PASS), a transport and peering privileges solution that enables IXP members that peer at one location to access community members that peer at the other. Available immediately, and without needing a physical port in the other city, members with a direct peering connection in Paris will gain access and peering privileges with more than fifteen unique networks in Marseille; and members with a direct connection in Marseille, will be able to peer with over 350 unique networks in Paris. “No matter if our members are directly connected in the physical location of Paris or Marseille, our new PASS Service now enables them to reach the whole of FranceIX, and several hundreds of members that make up our rich ecosystem. This includes carrier networks, CDNs, social networks, streaming, gaming, cloud and IT service providers who choose to interconnect for the interest of all,” said Franck Simon, president of France-IX Services. “The PASS Service is yet another innovative solution that makes France-IX the best choice for peering in Europe – get to Marseille or Paris and the whole of the France-IX peering community is yours.” In addition, PASS Service users will
BSO, an Ethernet network provider, has broadened its wholesale portfolio with the acquisition of IX Reach, a global network service provider. IX Reach has become BSO’s third acquisition in the last 18 months and joins Apsara Networks, a provider of radio frequency connectivity to financial markets and PROceau, a managed hosting and IaaS company. “Our global M&A strategy remains on pace and acquiring IX Reach cements our reputation as the network provider of choice for financial services, cloud providers and technology businesses,” said Michael Ourabah, founder and CEO of BSO. BSO’s network infrastructure and expertise, combined with IX Reach’s diverse network reach plus products and services will enable the group to continue to invest heavily in R&D and push new boundaries in product delivery and provisioning automation. “This is a great move for IX Reach that secures long term investment for us, improving our customers’ experience and seeing acceleration of our future growth and expansion. I’m delighted to be working with BSO who have been our friends and partner for over a decade and am excited to be a part of their team,” added Stephen Wilcox, president and founder of IX Reach.
benefit from increased resiliency on their interconnections with current peers thanks to two direct paths delivered by two different providers. The first via Lyon and the other via Clermont-Ferrand without any single point of failure, via 100G DWDM optical network transport solutions between Paris and Marseille. As a result, France-IX is able to achieve a round-trip delay of less than 12ms. The service is available on all peering ports: 1, 10 or 100GE in the 12 France-IX point of presence and access is provided through a transport solution.
PASS Service provides connectivity for all says Franck Simon, CEO, France-IX
june/july 2019
europe | 17
SPARKLE TO BUILD BLUEMED SUBSEA CABLE Sparkle has announced plans to build BlueMed, a new submarine cable connecting Palermo with Genoa, Italy. The new 1,000km system will cross the Tyrrhenian Sea linking Sparkle’s Sicily Hub data centre in Palermo that currently serves eighteen international cables, with Genoa’s new open cable landing station, which is connected to Milan’s digital ecosystem. “The investment on the deployment of BlueMed and of the landing station in Genoa represents the first phase of a wider plan aimed at consolidating Sparkle’s leadership in the Mediterranean basin through the extension and enhancement of its regional backbone”, said Mario Di Mauro, CEO of Sparkle. With an RFS date of 2020, the cable will deliver a capacity of up to 240Tbps providing advanced connectivity between the Middle East, Africa, Asia and the European mainland hubs. The new system is also set to cut latency by 50% compared to existing terrestrial cables connecting Sicily with Milan. In addition, the company’s new open
landing station in Genoa is set to become the next priority access point for other upcoming subsea cables looking for diverse entry into Europe and therefore strengthening Italy’s position as digital gateway between Africa, the Middle East, Asia and Europe.
Speaking exclusively to Capacity, Sparkle confirmed that the new system is 100% proprietary with further announcements on extending the cable in the Thyrrenian Sea and Southbound of Sicily likely to follow. The company also has yet to select a vendor.
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18 | executive interview: ruth kennedy
PROGRESSING INTO A FIBRE-RICH AND EQUAL FUTURE At the TalkTalk Business Connectivity Matters Summit, Laurence Doe caught up with Ruth Kennedy, director of carrier & systems integrators, to discuss industry challenges and what plans are afoot to maintain a competitive edge
S
itting with Kennedy in the surreal business-meeting surroundings of the Ministry of Sound in London, the speakers booming downstairs would normally be something that does not suit the tone of a corporate gathering between a telco and its partners, however, this occasion is different. There are celebrations taking place. Two years after the re-setting of TalkTalk, the fundamentals of the business are much stronger. It has grown its customer base in a disciplined way and accelerated fibre take-up all while reducing costs. In its latest financial results for 2018 to 2019, revenue has grown by 17% and an increased headline EBITDA stands at £237 million. Kennedy tells me that TalkTalk Group’s progress is being supported well by its Business division, which is split into partner and direct teams, and the one she leads — carrier services, which provides connectivity to the UK and is an alternative to BT Wholesale. “BT Wholesale is historically the incumbent but not many people know that we’ve unbundled more exchanges than them,” says Kennedy. “Where we differ from others in the market, not just BT Wholesale, is that we are very commercially flexible. We are a lot leaner with regards to colleagues and a lot more agile, so we can respond to our customers’ needs quickly. In all our customer satisfaction scores we rank very, very high on trust and accountability.” But it seems as though the good results are on the cusp of getting even better as Kennedy says that the group is yet to complete its access network transformation (ANT) programme, an upgrade to TalkTalk’s next generation network that makes it “fit for the future”. ANT is addressing capacity and scalability issues in the access and metro network. It will do this by deploying new
next generation edge devices, and revising the topology and architecture for both optimised traffic management and improved resilience. “Through the ANT upgrade we’re able to provide much higher bandwidth, as well as speeds of 10Gbps and 100Gbps,” states Kennedy. “Our network is very resilient and to ensure it continues to be in the future, we’re also investing in this area of performance.” Capacity But is this enough to keep it competitive against the likes of BT, the largest provider of fixed-line, broadband and mobile services in the UK? After asking Kennedy what else she feels is keeping the company’s connectivity strong with its customers, she tells me that Fibre Nation — TalkTalk’s wholesale full fibre network, is growing. TalkTalk’s full fibre strategy, announced in November 2018, is building a new broadband network for Britain through its company FibreNation, which will roll out faster, more reliable broadband. “We’re staying ahead of the curve with FibreNation, which we’ve already rolled out in York,” explains Kennedy. “FibreNation will be rolling out full fibre in Harrogate, Ripon and Knaresborough next and we will continue to deploy in more small towns and cities with the ambition of reaching three million homes and businesses across the UK.” Kennedy joined TalkTalk Business in 2011, having previously been with Irish telco Eir as its UK wholesale manager, so, with that in mind, I find it appropriate to ask her if anything has shocked her during her telecoms career. “Nothing has shocked me about the telecoms industry,” she says, smiling. “I genuinely love it. I’m also passionate about the carrier industry and its community. I love the fact that we all share ideas and work together, all while being in competition with each other.
“However, I would have thought that we would have higher bandwidth quicker than what we have. One gigabit is only just becoming the norm and I would have thought that would have happened maybe four or five years ago, but then that’s all to do with the price and what the consumer demands.” But has the telecom industry presented any other barriers that are perhaps more personal for Kennedy? Venturing into the discussion, I feel I already know the anwser as a majority of TalkTalk’s upper management summit speakers are women. “TalkTalk has brilliant representation in terms of women, many of our leaders are women including our CEO and MD of TalkTalk Business,” replies Kennedy. “There is room for improvement, and I think the industry can and should do more to improve representation. Circumstances don’t always allow women to fulfil their career potential in telecoms because it can be difficult to navigate. This is especially apparent if you’re working in the international market or even the national market as there’s a lot of travel involved. “I’m also passionate about the inclusion of children who have special needs. We’ve supported Ambitious about Autism since 2006 and raised nearly £4 million the charity. Joint fundraising events have helped Ambitious about Autism to make the ordinary possible for young people with autism.” With that, the music dies down and the meeting concludes as Kennedy takes the signal of another discussion taking place downstairs as a cue for her next meeting. TalkTalk’s strategy is clear, grow through increasing connectivity and a reliable service; but Kennedy makes another great point: “breaking down the industry’s non-technological barriers for those that are eager to be included benefits everyone”. june/july 2019
EURASIA 2019
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20 | middle east
OOREDOO SELECTS NOKIA FOR 5G NETWORK DEVELOPMENT
O
oredoo Qatar has selected Nokia to build a 5G cloud native core network to support delivery of enhanced mobile broadband services, including aerial drones. Nokia will deploy its systems in Ooredoo’s datacenters, marking another step towards the roll out of 5G services in Qatar’s capital city of Doha. Nokia’s cloud-based architecture combined with Ooredoo’s core network will make it more scalable and suitable for extreme mobile broadband and machine communication services. One of the most anticipated innovations Ooredoo is involved in is the worlds-first self-driving 5G connected aerial taxi — a large drone-like vehicle big enough to transport two people to a destination up to 20 minutes away.
Yousuf Abdulla Al Kubaisi, COO, Ooredoo Qatar, commented: “The modernisation of our core network will enhance our capabilities to innovate with new services. “It will also help us to meet additional demands for high-speed data services in general as well as bursts in demand, particularly in upcoming sporting events. “Our 5G network will open the floodgates for machine learning, automation and micro-services use-cases for consumer and business customers in the country.” Bernard Najm, head of the Middle East market unit at Nokia, continued: “We are really excited to partner with Ooredoo Qatar to set up a 5G core network that is truly ‘cloud native’ from the ground up, not just an evolution of current core solutions.”
Capacity
Qatar’s capital city of Doha
MOEX PARTNERS WITH AVELACOM The Moscow Exchange (MOEX) has partnered with Avelacom and deployed new points of presence (PoPs) in Hong Kong, Singapore, Shanghai, Dubai and Mumbai data centres. The partnership enables MOEX’s clients located in Asia and the Middle East with facilitated connectivity options. Market participants also receive high speed access to MOEX’s markets without the need to build extra infrastructure and pay for low latency network connection to Moscow. “This is a meaningful partnership that makes us responsible for the management and support of services to MOEX’s international institutional clients,” said Aleksey Larichev, CEO of Avelacom. “It’s an acknowledgement of the work we have previously done to provide a high-performance and sustainable trading environment. These simplified connectivity options will help attract more
clients to MOEX from all over the world.” In addition to this expanded global reach in MOEX’s connectivity, cooperation with Avelacom has allowed the Exchange to improve quality specifications of its PoP in London: the round-trip latency from Equinix’s LD4 to MOEX has been reduced to 36ms (from 41ms). Igor Marich, FX and money market managing director at Moscow Exchange, commented: “We see growing interest in Russian assets from these regions from financial market participants such as investment funds, HFT traders and market makers. “The new PoPs in Asia, which have been deployed in the most commonly used data centres for connection, will help existing customers optimise their connectivity schemes, while providing new customers with more effective trading solutions and open access to MOEX’s liquidity pool.”
TELECOM EGYPT SIGNS PEACE CABLE AGREEMENT Telecom Egypt, Hengtong and PCCW Global have signed a landing party agreement for the PEACE cable, a key cable system for the Middle East and parts of Europe and Africa as it crosses Egypt and connects Pakistan, Djibouti, France and Kenya. Under the terms of the agreement, Telecom Egypt will purchase fibre cables from Hengtong, which will buy the fibre to cross Egypt from the operator. “I am very pleased with the signing of the landing party and crossing agreement as this marks the addition of another cable system to Telecom Egypt’s huge network of submarine cables crossing Egypt,” said Adel Hamed, CEO, Telecom Egypt. “This clearly exhibits that Egypt is the ideal digital route and partner of choice for international traffic from the East to the West.” PEACE is the first Chinese privately owned subsea cable system. Development of the system started in 2017 and has a RFS date of 2020. Landing party agreements for Djibouti and Pakistan were previously signed with Cybernet acting as the landing party in Pakistan and Djibouti Teleco as the landing partner in Djibouti. In December 2018, PCCW Global and Orange signed on as landing partners of the system in France. The system is currently in the manufacturing stage and is designed to be extended southwards towards South Africa and eastwards towards South East Asia sometime in the near future.
Adel Hamed, CEO, Telecom Egypt
june/july 2019
SPONSORED STATEMENT
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CONNECTIVITY FOR THE DIGITAL REVOLUTION
ǧ CONNECTIVITY WITH ROAMING AND CLEARING Connectivity lies at the heart of the modern day world. With new technologies rapidly entering the connectivity sphere every day it can be overwhelming for businesses to keep up with their journey to digitally transform. This is why it is vital to transform today’s - Marco Limena telecommunications structure. Leveraging the Marco Limena, CEO, TOMIA core capabilities of two Capacity global leaders, Telarix and the routing for the interconnect carrier to carrier business or for Starhome Mach in optimizing CSP’s profitability, TOMIA roaming or settlement reconciliation. Last but not least it is about constitutes the industry’s single offering to cover both roaming how to ensure the execution of the service in economic terms. and interconnect to support the evolving needs of complex This is a critical asset for carriers to think about within their connectivity in the digital era. Put simply, TOMIA is business. implementing the first standardization of the new The market reaction to our new brand announcement was telecommunications infrastructure and its services, enabling great. We received a lot of support and encouragement as providers to monetize the digital revolution. we brought together 20 years of experience in the respective For the first time operators and carriers are now able to benefit ecosystems of both former companies. But while we are a known from one, unified view of the end-to-end connectivity process, entity with significant heritage, we are bringing a fresh view to operators’ margins and the customer journey. By monitoring the the value of connectivity in the context of transformation. full scope of activities on a single platform, carriers and operators We boast several areas of innovation. Firstly, the foundation of are able to better manage their margins and optimize agreements, innovation that comes from our deep understanding of the carrier as well as identify fraud in real time, thereby decreasing their business and from software, which is a catalyst to bringing that overall costs and risk. innovation to market. Another is our expertise within telecom Across many services including voice, SMS, mobility and services. Through the evolution to 5G and VoLTE technologies roaming, we are uniquely positioned to demonstrate end-to-end we are bringing roaming to Network Function Virtualization monetization. This covers three important elements. The first is (NFV) capabilities. Finally, integrating Blockchain, Artificial how to establish a carrier-to-carrier agreement and provide the Intelligence and Machine Learning into our portfolio, TOMIA ability to make sure that operators can look at their margins based will enable carrier and operators to digitally transform their on the contracts and bi-lateral agreements they set. The second services. Below are just two examples of the unique synergy and is how to optimize the execution of the service, whether it’s on value TOMIA brings:
Through the partnerships with our customers we have recognized that they are internally reorganizing, creating a new category. We are taking the same approach�
Applying Artificial Intelligence to fraud management and monetization
Blockchain based smart contracts and smart settlement
We are applying Artificial Intelligence to our traditional capabilities to become the leaders in international fraud prevention and monetization across interconnect and roaming. We are offering one combined and complete portfolio for international fraud prevention services, using Machine Learning driven decision making.
We are using Blockchain to bring capabilities around defining smart contracts and smart settlement processes, to create more cost and operational efficient solutions. Our goal is to assist carriers as their billing and settlement needs continue to evolve.
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22 | africa
SAFARICOM PLANS TO DOUBLE 4G SITES BY 2020
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afaricom will double its 4G sites to 5,000 base stations by March 2020, bringing its network coverage in Kenya to 80%. The news was confirmed during the announcement of the company’s financial results for 2019. The project is expected to cost Safaricom over $355 million (KES 36 billion), which will see the company deploy an additional 2,030 3G and 4G+ base stations. Safaricom’s CEO Bob Collymore said: “For a majority of Kenyans, the mobile phone is often the first and only link to the Internet. By broadening our 4G coverage to almost anyone in the country, we aim to ensure that no one has to miss an opportunity or get left out because of lack of access to affordable, quality, high-
speed broadband.” Safaricom was the first operator to roll out 4G in Kenya during 2014, and in June 2017 it achieved another first in East Africa after upgrading a section of its network to 4G+, which doubled 4G speeds of up to up to 100Mbps for Safaricom’s customers. “Looking ahead, the business will sustain its momentum of investing in the quality of our service and diversification of our revenue portfolio to ensure sustained returns to shareholders,” added Collymore. For the first period of 2019, Safaricom saw its net income increase by 14.7%, equal to $627 million (KES 63.4 billion) with revenue totalling $2.3 billion (KES 240.3 billion). “We are pleased with the strong results
we have delivered for the year, building on our long track record of delivering relevant products and putting the customer first,” added Collymore.
Safaricom’s CEO Bob Collymore
PLANNING UNDERWAY FOR AFRICAN BROADBAND BACKBONE Tata Communications Transformation Services (TCTS), the telecommunications development subsidiary of Tata Communications, is partnering with research group Africa Development Solutions (ADS) to build a fibre infrastructure across Africa. Aerial fibre, designed for deployment within the last mile of the network, and free-space optical cables, which use light propagating in free space to wirelessly transmit data, are two technologies being considered in the first phase of preliminary studies by TCTS and ADS due to factors such as cost, quality and speed of deployment.
The TCTS-ADS partnership is following the vision of Smart Africa — a continent-wide initiative between African Capacity states that aims to accelerate sustainable socioeconomic development on the continent and create a digital economy that supports societies and communities. “It is great to see that a renowned expert in ICT networks deployment like TCTS is ready to further commit to Africa’s development,” said Samba Bathily, founder and CEO of ADS, an organisation dedicated to researching and promoting projects that will benefit African development. “ICT access will be a game-changer and
a growth-driver for the continent. We just need the infrastructure to create economic opportunities for our communities and unleash African talent and creativity.” TCTS will perform pre-feasibility assessments with ADS for African nations, studying existing, as well as planned fibre infrastructure and deploy a strong multi-country connectivity infrastructure backbone, as needed. The Smart Africa initiative prioritises information communication technology as a key enabler, with scalability and accessibility of connectivity within and to urban, suburban and rural areas in Africa a top priority.
SOUTH AFRICAN ISP JOINS ANGOLA CABLES’ FORTALEZA DATA CENTRE
António Nunes, chief executive officer of Angola Cables
South African internet service provider Cool Ideas has signed an agreement with Angola Cables to co-locate at the company’s data centre in Fortaleza, Brazil. Angola Cables launched the Tier III facility back in April to support growing demand in content data transmission in the Southern hemisphere. The interconnection point will enable African entities to develop and expand their businesses in Brazil, Latin America and the USA via the South Atlantic Cable System (SACS) and Monet subsea cables. “The configurations of our sub-sea cable network comprising SACS, MONET and WACS and the upgrade of our data centre provides a reliable platform for operators to extend their IP ecosystems and services to international markets,” said António
Nunes, CEO of Angola Cables. “This is also opening up extensive opportunities to develop content partnerships and the efficient exchange of data that will have a profound effect on societies and emerging markets seeking to engage and prosper in the global digital economy.” Cool Ideas has been using capacity of the SACS trans-Atlantic cable to offer customers “a direct, high-speed, ultra-low latency fibre-optic connection” to hubs in Fortaleza and Miami. Andre Jooste, director and founder of Cool Ideas, said: “The partnership with Angola Cables suits our business goals and aspirations as we have access to their secure infrastructure and services, it helps us to reduce costs whilst offering scalability, continuous connectivity.” june/july 2019
Capacity
24 | analysis: north africa
EGYPT ‘TO BECOME GATEWAY TO AFRICA AND ITS DATA HUB’
E
gypt is poised to become the African hub and the gateway to Africa, said the CEO of Telecom Egypt at Capacity North Africa in April. The telecoms industry has long known of the importance of Egypt to the world’s networks, situated on the main fibre route along the Red Sea between Asia and Europe. But this country, with a population now of over 100 million, has long been a meeting point for Africa, Asia and Europe. Just 200 metres from the venue of the Capacity North Africa conference in Cairo is the worldrenowned Egyptian Museum, home of artefacts thousands of years old showing how this ancient civilisation has been at the centre of the world around it. And that’s the role envisaged by Adel Hamed, who took over the leadership of Telecom Egypt earlier this year. He opened the first ever Capacity North Africa conference in Cairo with a declaration that the company and Egypt itself could be the key hub for Africa. Telecom Egypt’s rival, Fiber Misr, echoed Hamed’s call. Nagui Anis Khalil, vice president of strategy and planning, pointed the delegates southwards from the vital Red Sea-Mediterranean connection that is vital to the world’s networks. (Incidentally, Misr, pronounced “muz-re”, is simply the Arabic name for Egypt.) Khalil said that Egypt “is the second country in the world in terms of submarine cable connections”, but “we need to transform from just transit and build upon these cables. North Africa needs more internet exchanges and data centres to keep content in Africa.” Khalil called for Alexandria, on Egypt’s Mediterranean coast, to become a data centre
hub comparable with Marseille in southern France. The electricity supply “has doubled in Egypt in the last four years”, he said. “We have a 35% surplus. It is not the cheapest in the world, but it is reliable. We have all the factors for a data centre business.” Guillaume Perdriaud, chief wholesale and international officer at Inwi, the Moroccan operator, agreed about the importance of building infrastructure into Africa. “The very strong story is about unloading the capabilities inland, across Africa. We need to build the future,” he told the conference. Before he took over as CEO of Telecom Egypt in succession to Ahmed El Beheiry, Hamed was the company’s chief international and wholesale officer. The company is at the heart of the Egyptian government’s ambitions to create a digital Egypt, with its digital transformation initiative, which includes schools and government institutions. Key to this whole process is better Capacity connectivity for Egypt and all African countries. Senior executives from the industry spoke about plans to build new cables through Africa. Mohamed Ahmed Mohamed, director of international business at Djibouti Telecom, told the conference that the company will start laying the $86 million DARE1 – Djibouti Africa Regional Express – cable in October 2019, due for service in June 2020. It will have four landing stations along the east coast of Africa, between Djibouti and Kenya, in order to cater for growing international traffic, he said. Another is the PEACE cable, linking Pakistan with east Africa and Europe. Mohamed Nasr, vice president of cable innovation at PCCW Global, told the conference that the project was “one of the
Adel Hamad: Telecom Egypt and Egypt itself should be the key hub for Africa
fastest cables I’ve ever worked on”. The PEACE cable project has already announced key partners, including Interxion, which is providing facilities in Marseille, Icolo, which is doing the same in Kenya, and Cybernet, in Pakistan. Danish Lakhani, CEO of Cybernet Pakistan, said the arrival of the system “will have an outsized impact on the digital landscape in Pakistan”. He added: “PEACE is the only cable system that originates in Pakistan and connects three continents – Asia, Africa and Europe.” The cable “elevates our country’s strategic standing in the global connectivity race”. PEACE is backed by Chinese parent company Hengtong, whose vice president, Wu Qianjun, said: “PEACE is the first privately owned submarine cable system from China. We see the PEACE project as a strategic pivot for the Hengtong group.” The cable will give Hengtong “our experience as a subsea cable investor”, he said, and help the group to identify “new investing opportunities in this market in the future”. In May an announcement to the Shanghai Stock Exchange disclosed that Hengtong is likely to be purchase Huawei Technologies’ 51% stake in Huawei Marine Systems.
THE ONLY TELECOMS MEETING WITH A FOCUS ON INFRASTRUCTURE DEVELOPMENTS ACROSS AFRICA
11 & 12 September, Rwanda
400+ 145+ SENIOR LEVEL EXECUTIVES
COMPANIES
56+ COUNTRIES
30+
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Capacity
26 | asia and asia-pacific
SOFTBANK PICKS NOKIA FOR 5G EVOLUTION
CHINA TELECOM SUFFERS INTERNET OUTAGE China Telecom’s backbone experienced a “significant, globally distributed outage” on May 13, according to network monitoring company ThousandEyes. The organisation, dubbed ‘the X-ray of the Internet’, reported that China Telecom’s outage may have impacted more than 100 services in and outside China, including wellknown applications, sites and services such as Workday, Slack, Salesforce, Apple and Microsoft Over a period of nearly eight hours, starting at 12:30pm and ending at 8:00pm Pacific Time, China Telecom experienced sporadic packet loss across
its network, stopping users from accessing its services and applications. Angelique Medina, director of product marketing at ThousandEyes, stated: “Coming as it did at a moment of heightened tensions with the US over trade policies, it may be tempting to jump to speculation about potential geopolitical motivations. “However, doing so misses some important foundational realities about China and the Internet that many folks aren’t aware of. This outage is a great opportunity to dig into the state of Chinese internet connectivity.”
Japanese telco SoftBank has selected Nokia as a strategic partner to drive its commercial 5G offering with the Nokia AirScale solution. The rollout of AirScale will allow the telco to meet growing consumer and industrial demands for 5G. As an existing supplier of multiple technologies to SoftBank, Nokia’s selection for 5G radio re-enforces the strong relationship between the two companies. Nokia’s 5G AirScale supports multiple frequencies, in both distributed and centralised architectures, giving SoftBank flexibility in its network evolution. Nokia’s 5G AirScale will
be deployed across Japan, bringing 5G RAN to businesses and consumers alike. John Harrington, head of Nokia Japan, said: “We are delighted to continue our long-term relationship with SoftBank and to be working with them as a trusted end to end partner at such an important milestone in the transformation to 5G.” The 5G investment will benefit consumers by bringing them a 5G enhanced mobile broadband service, with 5G ultra reliable low latency connectivity and enhanced machine type communication enabling multiple new industrial 5G applications and services.
Capacity
INDIGO CABLE GOES LIVE
17 & 18 September 2019, Yangon
CONNECTIN G THE E N TIRE ECOSYSTEM OF TELECOMMUNICATIONS IN M YAN M AR
450+ 150+ ATTENDEES
COMPANIES
20+
The 9,200 kilometre Indigo subsea cable system got the green light for deployment in late May following the completion of the Indigo West and Indigo Central cables. eployed by a consortium of AARNet, Google, Indosat Ooredoo, Singtel, SubPartners and Telstra, the new system will feature new spectrum-sharing technology enabling each member to upgrade their networks and make capacity increases on-demand. “The development of the INDIGO cable system strengthens the link between our Australian network and the fastgrowing South East Asian markets and will deliver our customers faster connectivity and dramatically improved reliability,” said Oliver CamplinWarner, head of international, Telstra. “Our vast subsea
network is a key part of our international growth strategy and we will continue to invest in additional capacity to meet our customers’ increasing demand for data and maintain our network leadership in the AsiaPacific region.” The Indigo cable system will strengthen connectivity between Australia and the fast-growing Southeast Asian markets, providing lower latency and more reliable communication services. Using current coherent optical technology, the cable can support up to 36Tbps, the equivalent of streaming millions of movies a second, all at the same time.
COUNTRIES june/july 2019
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28 | executive interview: alexandre pébereau
TOFANE BEGINS A NEW CONNECTIVITY CHAPTER The ink has now dried on Tofane’s latest acquisition agreements; however, the company’s momentum is picking up pace once again. Alexandre Pébereau, the company’s CEO and founder, talks to Laurence Doe
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ébereau is highly anticipating the return of International Telecoms Week (ITW) this year as a new Tofane group will return after two key acquisitions from Netherlands telco operators KPN and Altice. The new group’s form is now complimented not only by iBASIS, a well-recognised name in voice-over-IP (VoIP) wholesale, but also by Altice’s former international carrier voice businesses in France, Portugal and the Dominican Republic, which have been consolidated under the new, rebranded iBASIS. According to Tofane, these new acquisitions have more than 1,000 customers in 18 countries and the group will use its resources to develop solutions and deliver coverage and scale to the international voice, data and mobile carrier market, which Tofane estimates is worth over $40 billion. With a great amount of excitement in his voice, Pébereau says he is holding on until the industry gathering begins to reveal more about how Tofane’s iBASIS will harness the “strong opportunities” of the global communication market. With the addition of iBASIS, Pébereau says that the group has gained a better foothold in the industry through “very strong strategic relationships” that bear wholesale solutions for tier one telecom operators in areas such as 5G product development. “iBasis has a strong ability and is considered number three in the world for voice traffic and number three in the world for 4G roaming, but we definitely want to grow the company aggressively and rapidly because we see ourselves as the long-term developer of this market and want to give more and more solutions to our customers to help them focus on their own priorities,” states Pébereau. The new iBASIS will be growing
rapidly with a product portfolio expansion that will follow three parallel avenues of development. Its first route will be to independently develop its products. iBASIS has facilitated 4G/LTE roaming over multi-service IPX networks with testing for operators, “but we want to continue this long tradition of the company and continue to do our own product development,” explains Pébereau. Capacity One of the ways iBASIS will achieve this is through creating an algorithm that supports its InVision platform’s ability to track, monitor and manage mobile data roaming by applying the capabilities to the internet of things (IoT). This is all part of the new iBASIS focus on global connectivity and global access for IoT service providers, which aims to simplify the deployment of connected cars, industrial IoT and logistics services that rely on embeded SIM (eSIM). “We, as one of the top providers of eSIM deployment, are providing the next generation of M2M communication with embedded SIM,” explains Pébereau. “In February 2019, we signed a partnership with Nordic Semiconductor, one of the world’s largest Bluetooth chip suppliers, so that iBASIS eSIM will be in all of Nordic’s newly launched modems and IoT cellular modules, which are suitable for compact wearable consumer and medical devices.” Over the past year, iBasis has tripled its customer base by addressing verticals such as these, with transportation, semi-conductors, logistics, and travel to name only a few. However, the energy that will fuel iBASIS’s journey down a second avenue of development will come from partnerships. Pébereau highlights AMEEX, a global
We are providing the next generation of M2M communication” Alexandre Pébereau CEO & founder, Tofane
independent provider of SMS solutions for mobile operators and enterprises, as one partnership to watch as it will lead to a new SMS messaging system that will rejuvenate the mature market “with many new revenue opportunities”. He explains that AMEEX is helping mobile operators to recover losses in areas such as application-to-person (A2P) messaging, which, he adds, is still “a booming market in regions where smartphone penetration is less dominant and where SMS remains critical for communications”. The final avenue that iBASIS will venture down is mergers and acquisitions, which Pébereau delicately describes as a process of “cherry-picking” the partners that have a strategic alignment and provide mutual benefits for product development. “That’s where we reinvest, in our projects, to enlarge the scope of the company and provide more services to operators,” he adds. The routes that iBASIS is traversing may not be easy, but Pébereau has an attitude that should relax the company’s shareholders. In a confident conclusion, he says: “We are the carrier, we take you wherever you want, and we will bring you there first. “We will be there first – for copper to fibre, as that is the origin of telecoms, through 4G and next through to 5G, our customers will be first with us – to markets, to technology and to their transformation.” june/july 2019
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Equinix: Leading from the front
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his interview started rather differently than most as I was greeted on arrival by my eldest brother. I meet Meyers in the London boardroom of Equinix’s PR firm, APCO Worldwide, which incidentally happens to be where my brother works. After meeting the APCO team, I head into the boardroom. Meyers stepped up to the top role in September 2018 and has an impressive CV at Equinix. After speaking with him, he clearly knows the business inside out. He has experience in a range of operating roles at Equinix, having been president of the Americas, COO, and gaining a global perspective in the strategy and product arena, which included scaling up the hyperscale infrastructure team (HIT). All of this has given the CEO a truly holistic view of all of Equinix’s functions and the business is clearly thriving after announcing an increase in quarterly revenues of 12% year-over-year to $1.363 billion. “We’re super excited about the HIT initiative. It’s headed by the former CTO of Digital Realty, Jim Smith, he spent several
Equinix has just announced record revenues, expanded its cloud exchange fabric, and disclosed its $2 billion plans to open new IBX data centres. Jason McGee-Abe spoke to Charles Meyers, CEO and president, to find out the secret behind the company’s competitive edge
years at Microsoft as a primary developer of their hyperscale cloud capacity. He brings a unique perspective and has built up a great team,” says Meyers. Equinix is in the latter stages of formalising a joint venture, which will essentially help to fund future hyperscale opportunities. “We have narrowed it down to a handful of targeted financial partners and we should have something to announce in the coming months,” he explains. “That strategy means that we can be more aggressive in the hyperscale capacity arena without straining our balance sheet by using third-party capital.” In Equinix’s Q1 2019 earnings call, it was disclosed that the company will spend nearly $2 billion to open 12 new international business exchange (IBX) data centres and expand 23 existing IBX data centres in 2019. It operates 202 IBXs in total. Interconnection revenues continued to outpace colocation revenues in Q1 with total interconnections increasing to greater than 341,000. Another notable development includes the Equinix Cloud Exchange Fabric (ECX Fabric) expanding its connectivity service to now support connection between all of its 37
ECX Fabric markets, located across five global continents.
M&A firepower Meyers continues to see M&A as one key tool in the company’s arsenal and “we won’t be shy to use M&A under the right circumstances if we feel it’s an appropriate strategic way to extend our platform”. The good thing about being the market-leader is that if someone is looking to sell their facilities or company they typically pitch Equinix but Meyers warns that it has to be fairly priced! “I will say that current private market valuations for data centre assets are robust to say the least but we’ll be appropriately disciplined to what we think are fairly priced assets,” he says. In terms of targeting and extending the platform geographically a number of markets are on the target list for Equinix. “I’ve talked about a number of markets where we see gaps in the platform that we would like to fill over time,” the CEO discloses. “India is a market our customers have wanted us to be in for some time. Current customers are looking to extend their presence in markets june/july 2019
the big interview: charles meyers | 31
globalisation of the economy. Equinix’s relevance with its geographical reach and scope of our digital ecosystems.”
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Group VP, marketing, Level 3 Communications
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President and GVP, IP and data services, Level 3 Communications
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Group president, messaging and mobile media, VeriSign
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President, Americas region, Equinix
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COO, Equinix
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President of strategy, services and innovation, Equinix
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CEO and president, Equinix
Platform Equinix 2.0 “Platform Equinix supports the digital transformation agenda of our customers. People view, and use us, as a global platform,” says Meyers, as he explains the shape of the digital ecosystem today. “In fact, 86% of our revenues come from customers who do business with us in more than one metro. We’re not your traditional local provider of hosting and colocation. That’s not our business. We provide interconnected digital infrastructure on a global basis.” “We’re continuing to see the underlying drivers of the business continue to be exceptionally strong,” Meyers tells me, adding that he sees a number of other catalysts on the horizon for even more opportunities Equinix can capitalise on. The CEO looks at customers’ digital
We’ll continue to invest around $2 billion a Capacity year to add capacity over time”
Charles Meyers, CEO and president, Equinix
like India.” Meyers says he would like Equinix to be in the Indian marketplace within three years. Another strategic area to capitalise on is Africa. “We do not have a presence on the African continent and over time, it’s something that we strategically will absolutely want to do,” he adds. “We’ll continue to monitor that situation over time and be active in that space if and when that’s appropriate.” The CEO would also like to see Equinix enter the Mexician market and expand its Canadian presence. An interesting area of focus for Equinix resides in the subsea space. Not with actual cable infrastructure but with landing stations. “We estimate that about 35 of our data centres today are particularly well-suited to subsea landing station-type opportunities,” he reveals. “Where appropriate we’ll look at adding to that mix and there are certainly markets that Equinix sees subsea landing stations as key.” “We’ve won opportunities on 25 subsea cable projects over the last few years and are tracking 50 opportunities in the subsea space at present. Inter-continental traffic patterns are staggering and it speaks to the capacitymedia.com
transformation agendas in different layers. One is the core data centre layer, which “we’ll continue to invest around $2 billion a year to add capacity over time”. Another is the interconnection level, which is “our core differentiation or secret sauce of the business” whether its internet exchange, traditional cross-connects or now increasingly the cloud exchange fabric. “This is a major driver of the business and people using us as a way to integrate their private infrastructure with cloud and with network resources,” he tells me. “This evolving edge services play and network, connectivity, and data-related services continue to be interesting for us.” The next phase in the evolution of Platform Equinix has seen the unveiling of Network Edge services, a new product innovation enabling companies to modernise networks virtually, within minutes, by deploying network functions virtualisation (NFV) from multiple vendors to connect their digital supply chains at Equinix. “We introduced our smart keys service, which is a neutral third party encryption capability to support digital commerce applications and we have a service in pilot
now, which is a NFV service that will allow people to purchase and assemble virtualised network functions into networking solutions on top of Platform Equinix,” I’m told. “Those areas of opportunity in terms of edge data, edge networking, and edge compute are all significant new opportunities for the business to grow in the years ahead.” However, Meyers warns: “You have to be careful when you’re talking about edge as it means different things to different people.” When Equinix talks about the edge, it’s typically referring to the current digital edge or the interconnected edge where private infrastructure is interfacing with the rest of the digital ecosystem. Edge data services are clearly helping to boost business for Equinix and represents a big opportunity. “The edge will continue to evolve, in terms of where does compute and storage need to live in order to accomplish the customer use cases that are relevant,” the CEO says. “We’ll definitely see a further expansion of the edge.” Business is thriving at Equinix under Meyers’ leadership but how does he spend his spare time, if he’s lucky enough to even get some it seems? I jest, he loves his job but he also has, in his own words, another “great job”. The family man is now a grandparent (congratulations!), an avid “yogi” and he loves wakeboarding, hence the inspiration for this issue’s front cover.
Renewed focus Equinix also restructured the top-level of the company in March as it announced adjustments to its organisational structure to globalise the company’s operating model, scale the business and address the growing opportunity for Equinix as a strategic platform on which customers architect their digital business. The global interconnection and data centre company repositioned three of its veteran leaders - Karl Strohmeyer, Sara Baack, and Eric Schwartz - into new roles as the company strives to become an even more customer-centric outfit. They were promoted to chief customer and revenue officer, chief product officer, and chief strategy and development officer respectively, with the new roles becoming effective from early Q2. The C-level reshuffle comes “to address the growing opportunity for Equinix as a strategic platform on which customers architect their digital business”. But “we’re a rapidly growing company so we’ll continue to add the talent we need to execute on our strategy to stay ahead of the curve,” reveals Meyers, as Equinix starts a search for a chief technology officer (CTO) to join its ranks. “We’re actively evaluating candidates for the role and you may see an appointment in the coming quarters.” The future is bright for Equinix as it edges itself even further ahead of its competition.
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Carrier OTT: the best of frenemies Capacity
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or the carrier world, it’s an age-old conundrum: their love-hate relationship with over-the-top (OTT) players. These players present both a competitive threat and an opportunity in light of the fresh, innovative ideas they bring to market. The numbers bear out the size of the challenge, with mobile operator revenues for voice and data services, for example, expected to fall by over $50 billion between 2017 and 2022, according to a Juniper Research forecast from last year. One of the culprits? Continued migration to OTT messaging and social media services. But OTT players are here to stay – and with companies such as Google, Microsoft and Facebook now even rolling out their own terrestrial and subsea networks via projects like the MAREA submarine cable, it may be more important than ever for carriers to find
the best ways to both work alongside OTTs and offer their own value-added services to remain appealing. Indeed, the message among carriers is generally that the industry has evolved in recent years to be much more open to these players – which do, after all, drive huge amounts of network traffic and innovation. As Rolf Nafziger, SVP at Deutsche Telekom Global Carrier, says, over-thetop (OTT) players are these days an “integral” part of the telco industry, even if there also remains rivalry between the two. When WhatsApp launched a decade ago, it was a “big shock” to the telcos because it cannibalised their SMS revenues, says Nafziger. However, he says, services like that and YouTube have brought innovation that has propelled the industry forward. “For us, the OTTs are very important partners,” he adds. “I
think the rivalry in our industry was bigger in the past on the retail side compared to wholesale, but even on the retail side it’s very much normalising.” He points out that with the wave of smartphone developments and new applications, OTT players are providing a lot of essential content for Deutsche Telekom’s customers and have built up substantial bargaining power due to their ability to scale to billions of customers at once. Deutsche Telekom Global Carrier therefore offers a large portfolio to help boost OTT services, from leased capacity, traffic termination and HD voice to application-to-person (A2P) services for two-factor authentication. The company is also seeking to improve interconnection between its network and OTTs, and building up its Lambda Connect DWDM service to enable higher amounts of bandwidth for them. june/july 2019
feature: carrier vs. ott | 33
“In the end, the OTTs cannot live without the telcos and we cannot live without the OTTs,” says Nafziger. “It’s a yin and yang situation, because without the telco, the OTT would not be able to reach the end customer.”
Image: Adobe Stock
Opportunities Nafziger points to cloud as a segment in which such partnerships are gaining traction, with Deutsche Telekom Global Carrier trying to create more direct interconnections for carriers to cloud service providers through its Secure Cloud Connect product that it launched last year. In addition, the company is looking at how the market will change in the move towards 5G and edge services, though Nafziger says it is too early to say what this will mean for the evolution of partnerships. However, parent Deutsche Telekom already has a subsidiary in place called MobiledgeX to which it is outsourcing activities related to building an edge platform, aimed at growing an ecosystem that could help collaborators find new models. Nafziger believes, meanwhile, that the wholesale market also has room to learn from OTT players in how to increase agility – something increasingly required in the move towards virtualisation. “We need to change and learn in some areas from the OTTs, such as on how to service customers in a leaner way, become more agile and less hierarchical, and how to adapt and provide a quick turnaround,” he says. Francisco Santos, head of wholesale services at Telefonica International Wholesale Services (TIWS), says the current relationship between carriers such as TIWS and OTT players is “a bit of both, collaborative and competitive”. “However, in essence there is a common understanding that TIWS represents a commercial channel that creates a win-win scenario for OTTs,” he adds. “OTT players see Telefonica as a strategic ally to reach the most customers, while Telefonica sees OTT products as a perfect cross-selling opportunity for other networking products.” Santos explains that to help the change in mindset required for teaming up with both cloud service providers and OTTs, Telefonica has recently incorporated more than 200 professionals trained as “solution architects” into its global team. Furthermore, he says the company has specialised teams in some geographies for presales, provisioning and operations that work with “agile methodologies” to help adapt to customer needs. Bill Wohnoutka, vice president of capacitymedia.com
global internet and content delivery services at CenturyLink, agrees that collaboration is key. “The relationship between carriers and OTT players is important to ensure content is delivered to eyeballs all over the world,” he says. Wohnoutka believes content delivery networks (CDNs) provide a major opportunity going forward for carriers like CenturyLink in such partnerships, citing 20 per cent annual growth in CDN revenues across the market. In this area, he thinks, CenturyLink offers something unique for OTTs by providing both its fibre connectivity and an end-to-end media delivery service, with its Vyvx broadcast video service. CenturyLink is planning to expand its partnerships globally with both new and established OTTs, says Wohnoutka. “Content owners need a way to pass off the content from the acquisition source to the digital platform. CenturyLink can play a critical role in this shift with our capabilities and global network footprint,” he says. “We believe the industry is working in a spirit of collaboration as the worldwide demand for content continues to explode.”
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OTT stance OTTs themselves talk of a more collaborative environment today, too. “Carriers are generally very cooperative with us,” says Dave Temkin, VP of networks at Netflix. “They want to see us preloaded on their handsets and present on their set-top boxes.” The relationship has become more symbiotic over time, he says, after there was some initial friction – particularly among telcos that ran their own video services. “When we first started out, we were seen as direct competition, but we have good relationships with the carriers now,” says Temkin. “They tend to want to work with us on all sorts of things to unlock new ways to retain customers or increase revenue or market share.” These include “billing-on-behalf”, whereby people can add Netflix to their regular carrier bill and bundles in which carriers sell the service as part of a larger programming package. Telcos are also enthusiastic about interactive user content such as the choose-your-own-adventure-style programme Bandersnatch that recently came out on its service, a theme that Temkin says Netflix plans to use again on other titles. “Carriers are really excited about that stuff and anything that gets people more interactive with our service. The more engagement, the more indispensable our product becomes.”
We believe the industry is working in a spirit of collaboration as the worldwide demand for content continues to explode” Bill Wohnoutka, VP, global internet and content delivery services, CenturyLink
In addition, via its Open Connect programme, Netflix partners with ISPs to more efficiently deliver content as close to their end users as they need it. “We’ve designed these servers and services to be as ISP-friendly as possible, and it’s saved them tons of money, time and complexity on getting things going,” says Temkin. Netflix’s relationship with carriers looks good going forward, he says, while he has seen telcos evolve their partnership teams to become more open in working with OTTs. “If we continue putting out products our customers want, they’re going to find ways of working with us,” he adds. Temkin says the company also seeks to strike up “holistic” relationships with carriers, including taking terrestrial fibre and submarine cable capacity from them to better integrate their networks. “The better relationship we have with the consumer side of the business, the more likely we are to be a great wholesale partner as well,” he says.
Network play Unlike players like Google and Facebook, Temkin says Netflix has no plans to invest in rolling out its own terrestrial fibre or undersea cable networks, with the
34 | feature: carrier vs. ott
company believing that its partners are best at delivering that. However, he thinks Google and Facebook have done a good job in getting ISPs to evolve their product offerings and that their initiatives to roll out broadband to the underserved are exciting for the industry. But this will also pose a question for telcos, says Temkin: “Carriers have to decide whether they want to continue with their existing business model and chance someone else being first to market with a quality product in an underserved area,” he says. Facebook, Google and Microsoft were all unavailable for comment, but carriers themselves remain bullish about their ability to handle any potential rivalry. Nafziger says, for example, that Deutsche Telekom Global Carrier is flexible in its ability to adapt to new business models resulting from market changes. “There are always new areas of competition and we always need to adapt,” he says. “We need to learn how to deal with that and find our own way to be competitive.” Carriers are also looking at how they can innovate and add value in areas where OTTs have moved onto their patch. In this vein, Deutsche Telekom Global Carrier’s SMS+ Transit offering helps by providing high-quality routes to tap into the opportunity for A2P messaging, which carriers can pursue to compensate for falling person-to-person SMS volumes. Industry figures suggest this could be a smart ploy, with research firm Mobilesquared predicting that A2P SMS revenues will more than double from $11.9 billion in 2017 to $26.6 billion in 2022. Meanwhile, Frank Paterno, VP of carrier business development at business communications provider PGi, thinks carriers can find new revenue streams from the next phase of unified communications by bringing such services together into a more streamlined package for businesses. In line with an anticipated surge in demand for unified-communications-asa-service, PGi launched a UCaaS offering via its GlobalMeet platform in the EMEA region in May, after unveiling it in the US two months earlier. The service features cloud voice capabilities and a collaboration app, with interested telcos also able to gain from what Paterno describes as a carrier-friendly support network that helps solve customer issues in real time. “We realise the carrier still has to provide some value-add, so that they’ve got some ‘skin in the game’ and are using something more than just their name,” he says. Separately, Tata Communications has been increasing its focus on multinational
We realise the carrier still has to provide some value-add, so that they’ve got some ‘skin in the game’ and are using something more than just their name.” Frank Paterno, VP, carrier business development, PGi
enterprise rather than traditional wholesale as OTTs have started rolling out their own infrastructure and alternative chat apps have gained traction, says Tim Sherwood, the company’s vice president for mobility and IoT solutions. “We don’t really view what they’re doing as a competitive threat, but obviously it limits what we can sell to them because they’re doing more themselves.” That means the company has focused more on partnering on services such as unified communications and cloud with players like Microsoft, Cisco, Amazon and Google, providing the wide-area networking that’s required to connect to the cloud. “It Capacity really makes sense to figure out how to partner together to provide that combined solution, as there are still a fair few challenges for the CIO community to stitch together end-to-end services,” says Sherwood. He concedes that there could be some threat to legacy wholesale business if OTTs deploying networks go further beyond using them to serve their own direct retail customers to adopting more of a full international carrier model – but Sherwood believes from his conversations in the industry that this is not what they’re planning. And he says, for example, that the activities of players like Facebook to reach the underserved through more localised wholesale projects such as its Middle Mile Infrastructure initiative in the US or the Telecom Infra Project (TIP) globally will actually help carriers like Tata Communications by providing an overall greater density of communications infrastructure. This is reflected in the fact that Tata and many other carriers are in fact collaborating alongside Facebook on the TIP initiative, which aims to find innovative ways of deploying network infrastructure. They are also working with OTTs on other cable projects, such as Orange’s collaboration on Google’s Dunant transatlantic submarine cable.
Looking to the future At Telia Carrier, vice president and chief
evangelist Mattias Fridström is optimistic about the future opportunity for continued positive coexistence between carriers and OTT players – pointing to the way his own company has always found ways to stay relevant as the challengers have gained ground. He puts this partly down to maintaining close relationships with such players. “We’ve always found a way to keep on discussing with them, having a good dialogue and doing things that they don’t want to do,” he says. “We try to understand what they need from us and where we can be of help.” He adds that OTTs have huge amounts of traffic that they need to deliver around the world because of the enormous traction that some of them gain from users, with Telia Carrier able to help do this with its huge fibre network and strong record in IP transit. Fridström also doesn’t think the OTTs want to build networks everywhere, instead looking for lowest-cost routes and opportunities to grow capacity where there isn’t any. This, he says, means there is still significant room for carriers to work with them to spread their content and build fibre to connect data centres: “They have a lot of traffic they need to distribute and carriers still fill a role there.” On top of all that, Telia Carrier can help further boost the need for OTT providers to deliver content at the edge of the network, improving latency and quality of service to more people, through partnerships it has struck up with edge data centre providers such as EdgeConneX and TierPoint. “When we go with providers like that to tier-2 and tier-3 markets, we can bring a lot more quality into those areas and people there can consume these OTT players’ products much more easily,” says Fridström. At the end of the day, he says, the key is to continuing to work with OTTs to understand their needs and deliver what they want, supplying them with “pieces that they don’t have”. “If we have a good dialogue, we can continue to be relevant,” he concludes. june/july 2019
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Behind the scenes of Sparkle’s relaunch Sparkle is transforming into a global connectivity and digital services provider so Jason McGee-Abe spoke to new CEO Mario Di Mauro about the bold plans ahead for the carrier
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i Mauro has been in his new role for just under three months but has been part of the Telecom Italia family for over 20 years. “It’s been a very busy start for me, having the opportunity to meet many talented and motivated people at the company. Sparkle is an asset with a great history and I’m really proud to have been chosen to lead the company into the future,” he tells me. Sparkle is a very important wholesale player with some very important assets. Its global footprint consists of many points of presence (PoPs) and 530,000km of fibre, helping to serve carrier-to-carrier business, ISPs, and the over-the-top (OTT) and content players. As outlined by TIM’s CEO Luigi Gubitosi when presenting the Group’s Strategic Plan in February, the carrier has started its relaunch plans and has “lots of expertise and commitment to engage in a new journey,” Di Mauro says. The man who headed up innovation at the wider Telecom Italia Group before joining Sparkle is certainly passionate
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about the new priorities that are on the horizon and the changes that are afoot. “We plan to invest more than we did in the past and also enter new business areas,” he says. “It’s really a journey to stronger growth and to expand our reach in all areas, especially enriching and empowering our people to embark on new initiatives.”
A Champions LeagueWinning Team Di Mauro has created a new framework of innovation and management from the off to make the carrier a much leaner, agile machine. Sparkle already has a very strong team but Di Mauro tells Capacity that he’s “bringing in new people and mixing the culture up on our new journey”. The CEO wants Sparkle to compete at an even higher level and describes its investments as “a sign than Sparkle wants to play the game at the top level of the Champions League”. Using Di Mauro’s football analogy, he’s the new manager of an Italian team looking to reawaken and reinvigorate the players and club to return to the very top of the game: wholesale telecoms.
His team consists of strong players but he has made some key signings to elevate the team’s performance and success. This is rather reminiscent of the Italian clubs AC Milan, Inter, Roma, and Juventus, which are all sleeping giants compared to past fortunes. As we speak, Alessandro Pansa has just been appointed non-executive chairman of Sparkle. Pansa, who has a specialised background in security, will clearly help to enhance and drive Sparkle’s protection. In essence, Pansa is a world-class sweeper who will not only enhance Sparkle’s defence but will boost its trustability. “Alessandro’s arrival is an honour for us and for Sparkle. I am really happy that he joined Sparkle, with his domestic and international experience in security.” Di Mauro has also reduced the span of control within Sparkle. “In line with our relaunched strategy, we need to execute and run like a start-up. I need a new lean model and organisation, so I’ve streamlined the organisation and almost halved the number of direct reports into me,” he says. New roles - chief corporate officer, chief strategic marketing and business june/july 2019
the big interview: mario di mauro | 37
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Chief Innovation Officer, TIM
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Executive vice president of strategic projects
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Vice president of business evaluations
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Head of planning & control and investment projects, TIM Latam
“Execution, agility and innovation are key drivers of our relaunch plan,” he responds. “We have already set up working groups and processes to be more agile, improving time to market, we will also onboard new skills.” Sparkle plays not only a strategic role for Italy and the Mediterranean basis but globally too. It has critical important infrastructure and cable systems and Di Mauro says that the company is going to continue to enhance its investment levels in infrastructure. “We’re investing to relaunch the core business through the deployment of new footprints in selected areas, particularly the Mediterranean basin, Latam and Middle East,” he says. The Mediterranean is a huge strategic area for Sparkle and Di Mauro details the significance of its recent investment in BlueMed, which is a submarine multi-fibre cable linking its Sicily Hub in Palermo with Genoa. Sparkle’s Sicily Hub serves 18 international subsea cables and with BlueMed connecting
In line with our relaunched strategy, we need to execute Capacity and run like a startup. I need a new lean model” Mario Di Mauro, CEO, Sparkle
development officer, chief revenue officer, CMO, CTO - have been created. “This new-look Sparkle will create a new innovative culture for us to better serve our customers and propel us forwards in a changing marketplace.”
Investment & Expansion Plans Di Mauro believes the marketplace is evolving quickly, especially with the Gigabit Society (5G, UBB, AI, IoT, security, analytics) requiring digital solutions (smart connectivity, cloud, security, convergence, big data, IoT). “This poses a challenge to global carriers like Sparkle who need to evolve rapidly their offer on top of pure connectivity and create value for customers,” he says. What’s clear now is that Sparkle has a clear mission and bold ambitions to lead the change in the Gigabit Society and become a global connectivity and digital service provider. With global IP traffic expected to jump with the advent of 5G and IoT, more and more capacity and lower latency are simply put: vital in order to keep pace with surging IP traffic. I ask the CEO how he is going to implement the relaunch plan. capacitymedia.com
up to Milan’s rich digital ecosystem, its assets should attract even more customers looking for route diversification. “The system is set to be operational by 2020 and will provide advanced connectivity between the Middle East, Africa, Asia and the European mainland hubs with up to 50% latency reduction than existing terrestrial cables connecting Sicily with Milan,” Di Mauro claims. He adds that BlueMed will run in parallel to the terrestrial backbone and is “a natural alternative to some established, traditional routes”. He hints at Sardinia and Corsica as other regions in the Mediterranean for the “highway of the future” may extend to. Sparkle wants to enforce its presence around Latin America, which is like a second home to Di Mauro given his experience in the region, by leveraging its $300 million investment in the Seabras-1 cable system, which connects Brazil and the US. “We want to enhance our presence on the Pacific side of Latin America and we want to also grow in Mexico, Central America and North America,” Di Mauro divulges. The CEO adds that Sparkle will have a much more dedicated focus on the Middle
East and Africa regions in future: “I believe they have a lot of opportunity for Sparkle as we already have a strong presence in several countries and this will surely only grow. Eastern Europe is very important for us, especially Israel, Greece and Turkey.” “The same applies to western Europe and we have some good programmes there as well.”
Game-Changing Tech The CEO also has his sights set on the power of cloud and the edge. “Everything’s in the cloud and connectivity is evolving to managed, secure, ultra-low latency connection. Sparkle has to ignite new digital business on top of infrastructure, which means evolving the offer from commodity connectivity to managed connectivity, which offers digital solutions to address the needs of enterprises customers.” SD-WAN connectivity, security-as-aservice are major things that telcos are also leveraging as value propositions. “The future digital world will be increasingy driven by the growth of traffic but with strong requirements of low latency, resiliency, and level of security we can add to our core business of connectivity,” Di Mauro adds. “Multiply this with our cable systems and layer of services, we become even more credible and attractive to our customers.” Di Mauro states AI and big data, which he’s worked extensively with, are “key pieces which will complete the make-up of a telco’s DNA and business model in the future. “Given the trends of our new digital society, we need to reconsider our DNA. To not just look at infrastructure but beyond that at how these assets are managed, what layers of service can we deploy, and how can we provide these services to our customers.” Being a global company, the use of automation and AI is a must and Di Mauro says Sparkle needs to complete this journey over a three-year strategic period. He wants all of its networks to leverage the power of automation, software-defined networking (SDN) and network virtualisation. “Under my tenure, we will now look to accelerate this programme of innovation and automation, which also includes big data and blockchain,” he says. After the interview finishes I reflect on the discussion and the almost infectious enthusiasm that Di Mauro brings to the table, although recognising that “the relaunch plan is a major challenge for all of us but here at Sparkle, we never give up!” What’s clear to me is that the plans to relaunch Sparkle are very exciting indeed and they have repositioned their processes in a more agile and innovative way. Coupled with the new faces and experience that have been added to the Sparkle squad, he is on the verge of innovating and waking up this Italian carrier to play at the very top of the Champions League.
25 September 2019, London
Encouraging men and women to support and increase female leadership across the Telecoms & Tech sector Join us at the Global Women In Telco & Tech Summit & Awards There is currently a gap in recognising the achievements made by the telecoms and tech sector in empowering women in telecoms and closing the gender diversity gap. More than ever, there is a need to facilitate conversation and share successes made by our industry with the aim of encouraging wider adoption of these effective initiatives and to nurture new talent through its doors. The solution? The Global Women in Telco & Tech Summit and Awards. A day of engaging exchange and discussion, followed by a night of celebration and distinction. Bringing together all areas of the wider telecoms and tech industry.
Capacity
By day - The Summit Join the discussion during the inaugural Global Women in Telco & Tech Summit with a range of topics such as successful recruitment and top-down initiatives, mentorship programmes, training and development, to building a career in telecoms and technology. In addition, network with the various leadership teams, heads, managers, executives, new graduates and university students on the subject of diversity.
By night - The Awards
ENTRIES NOW OPEN
9MJ ,QTGFQ <TRJS NS 9JQHT 9JHM &\FWIX \NQQ GJ YMJ ܪWXY LQTGFQ F\FWIX HJQJGWFYNSL FHMNJ[JRJSYX RFIJ G^ HTRUFSNJX individuals and industry partners in the area of gender parity. Align yourself, your brand and your company to the diversity agenda and demonstrate that diversity, equality and inclusion are at your core as a business. Judged by an independent panel of leading industry analysts invited by Capacity Media’s editorial team, the awards will bring together key global players across the wider telecoms and tech ecosystem to honour accomplishments. Categories include rising star, woman of the year and best marketing or social media campaign. View the categories and submit your awards entry online. It is free to apply, and applications are welcome from all businesses. “By granting these brand new awards, the Global Telecom industry empowers women and brings up light to the women parity gap, a major societal challenge. I trust the individuals and organisations receiving these awards will feel both recognised for their pioneering efforts and empowered to spread the word and raise awareness on this matter within industry.” Katia Gonzalez, Head of Fraud Prevention, BICS
“I applaud The Women in Telco & Tech Awards – this newly created platform enables new perspective, paves the way for trust, empathy and authenticity and will fuel the need for diversity and inclusion in the ICT industry”. Marisa Trisolino, CEO, CMC NETWORKS
Hear from our Advocates! What are some of the biggest challenges you faced as a women in the telco/tech industry but more importantly how did you overcome them?
Alla Goldner Director, Technology, Strategy & Standardization AMDOCS One of the biggest challenges I faced in the early stages of my career was the lack of women in executive management and as mentors. When I started to work at Amdocs, and was accepted onto NYX Ѧ-NLM 5TYJSYNFQѧ UWTLWFR . MFI YT XUJHNܪHFQQ^ WJVZJXY YMFY one of the General Managers become my coach.
Become an Advocate
Johanne Mayer NaaS/NFV/ZOOM Consultant MAYERCONSULT <MJS . ܪWXY XYFWYJI NS R^ HFWJJW . \FX HTSHJWSJI FGTZY people listening and appreciating my technical knowledge when speaking with customer executives rather than my looks. I would wear very conservative clothes but I also worked hard learning as much as I could so I knew most of the answers.
Capacity
If you are passionate about gender diversity initiatives and would like to voice your own or your company’s views, becoming an Advocate will not only give you visibility as a role model, but will give you a platform to share insights with the entire communications infrastructure industry through Q&As, interviews, podcasts and more.
Speak in the Summit Are you seen or would you like to be seen as a role model for women starting off their careers in the telco and tech sector? Would you like to encourage female talent through your doors? Or would you like to share your company’s successful gender diversity initiatives? The Summit will welcome all men and women with an interest in gender diversity.
The Awards – Nominations are now Open! Award entries are now open! Don’t miss this opportunity to spotlight the amazing talent of women in telecoms and tech, boost your credibility with partners and employees and validate your mission or your company’s mission to achieve a gender balanced workforce.
Partner with the Awards & Summit Aligning your brand to the Awards & Summit can help demonstrate your company’s passion for supporting women in the telecom and tech workplace, creating an inclusive work environment, and is a proactive approach to promoting gender diversity throughout your organisation and the wider industry.
For all opportunities, please email Vanessa.barbe@capacitymedia.com www.capacitymedia.com/events/global-women-in-telco-and-tech
40 |
The man behind $16bn investment into digital infrastructure Marc Ganzi and his team have led investments in cell towers, data centres and fibre for a quarter of a century. But there’s one thingCapacity he won’t talk about with Alan Burkitt-Gray
F
or 25 years Marc Ganzi and two colleagues have been investing in cell towers, data centres and fibre networks – and now in their 5G equivalents, including small cells and other edge infrastructure. The most recent acquisition to be announced was in May, when his Digital Colony and a Scandinavian infrastructure investor, EQT, agreed to buy US fire firm Zayo for $14.3 billion including debt. Within days of the deal’s announcement, Ganzi happily agreed to an interview with Capacity, but his team made it clear that he wasn’t going to talk about Zayo. The deal will need to be checked by Zayo’s shareholders, US regulators and in other regions where it has infrastructure before being finalised in the first half of 2020. But it’s still a great opportunity to find out how Ganzi and his operation tick and explore their industry opinions. “Can you tell me about the Zayo deal?” I ask, even though his PR team are listening in. “No,” he says firmly. As CEO, Ganzi is the public face of a cluster of companies around Digital Bridge, run by him with Alex Gellman and Jeff
Ginsberg. All three were at the Wharton School of Business in the early 1990s. They’ve stuck together for 25 years, but it didn’t start that way. “My ambition was to be in finance and real estate,” explains Ganzi, adding that his first job after college was at a real-estate investment trust, “doing M&A work and buying distressed real estate”. But some of the buildings had “a couple of these things called ‘antenna leases’ with cellular telephone companies”, he recalls. “Because I was the young kid from Wharton, everyone thought that I understood technology and that I was smart.”
Investor’s dream It was an investor’s dream – 30-year leases on “space that was deemed a liability, the roof, collecting rain”, he says. “When people started paying us thousands of dollars for rooftop space, a light went off in my head.” He got together with Gellman and Ginsberg, who knew about mobile phones and had started a cellular phone company. “Cell phones were coming. There was just going to be this massive surge in real estate. The three of us got together – I understood
real estate, they understood cellular communications, and we put these skills together,” he says. “It was completely accidental, like all great things in life.” Today Ginsberg is the COO at Digital Bridge and Gellman is CEO of Vertical Bridge, the group’s tower specialist. Vertical Bridge is one of six main businesses within Digital Bridge; Andean Tower Partners, Mexican Tower Partners, DataBank, ExteNet Systems and Vantage Data Centers. There’s also a parallel business, Digital Colony Partners: “One is a fund; one is an investment manager,” says Ganzi. How much have they invested? “Our legacy companies are about $11-$12 billion, the fund is $4.1 billion.” So we’re talking about $16 billion or so invested or to be invested in digital infrastructure. Does that include Zayo? He can’t talk about Zayo. But it’s Digital Colony that is working with EQT to acquire Zayo. In April the same unit bought a UK-based outdoor wireless company, iWireless Solutions, to add to its existing indoor specialist, StrattoOpencell. If you’re a rugby fan and use june/july 2019
the big interview: marc ganzi | 41
2013
CEO, Digital Bridge
2003
Founder an CEO, Global Towers Partners
1999
Management partner, DB Capital Partners
1998
President, SpectraSite Communications
1994
President and co-founder, Apex Site Management
infrastructure is actually real estate. “At the end of the day digital infrastructure is probably more parts real estate than technology,” he says. “When you think about data centres and towers and fibre networks, they require entitlements [permissions and approvals] and a real property interest, whether that’s owning the land, whether that’s an easement, or a long-term lease.” These concepts mirror those that investors in real estate will understand. “Remember, when you place infrastructure, it’s on land. Fibre’s underground, you need an easement; a data centre is sitting on land, you need to own the acreage, or you need a long-term lease; a cell phone tower sits on a parcel of real estate and you own that land or you have a lease.” The business cases for digital infrastructure “are completely ingrained in real-estate principles”, he adds. “And the difference between being a good operator and a bad operator is your ability to understand those nuances – how to ingrain yourself into
Because I was the young kid from Wharton,Capacity everyone thought that I knew something about technology” Marc Ganzi, CEO, Digital Bridge
mobile at the Twickenham stadium in south-west London, it’s iWireless that’s likely to be delivering your signal. In February Digital Colony agreed to buy Toronto-based Cogeco Peer 1 for the equivalent of $574 million, from Cogeco Communications.
Global investor The team may be 25 years old, but Digital Bridge Holdings is only six years old, founded specifically to invest in digital infrastructure. Founded with Ben Jenkins, formerly of Blackstone, the operation has as its primary objective “to put our personal capital to work behind management teams, ideas and platforms that we really felt represented the best opportunity for investing in the future of digital infrastructure”, says Ganzi. “We have established ourselves as the leading global investor, owner, manager and operator of digital infrastructure. Through Digital Bridge Holdings and the Digital Colony Partners fund we are managing nine different investments globally, and we feel reasonably good about our place in the world as an investment manager.” I probe him a bit more on why digital capacitymedia.com
those communities, get the entitlements, have the right agreements, make sure you’re fully compliant with local municipal, county, state, federal [regulations] – there are so many different jurisdictions that relate to building real estate. You have to understand those principles very carefully. The folks that are really good are the ones that build the best locations – and the folks that aren’t very good at that end up running into trouble.” Digital infrastructure is a “very unique real-estate class”, he notes. You have to “have the ability to operate at five-nines standard”. This is a familiar term in telecoms, though not in traditional real estate. It means the system – tower, fibre, data centre or switch – has to run 99.999% of the time, and off, for maintenance or because of a fault, for an average 0.86 seconds a day. “We are very focused on uninterrupted service for customers, and that whether it’s a fibre connection, a data centre connection or a tower connection, even a small-cell connection,” says Ganzi. “These are the things that matter and the things our customers judge us on. They judge us not only on our ability to build the facility and to
provide the facility, but they also want to make sure it’s going to run well, in an uninterrupted fashion.” So what makes him and his colleagues different from other investors? Others “often don’t realise these aren’t like toll roads, shipping ports, or water treatment facilities”, says Ganzi. He applies what he calls “the asset test – ensuring we have a great location and a great facility that’s been engineered to accommodate multiple users”. A multitenanted, multi-use facility means “we can grow cash flow”, but much care is taken over Digital Bridge’s paperwork, “making sure you’ve got the right entitlements, making sure you’ve got all the permits necessary for the assets. These things are essential.”
Checking the paperwork Digital Bridge checks customer agreements, leases and licences. “Is [the investment] bankruptcy protected? Do you have early termination provisions?” What happens if the customer grows? “There are so many nuances in these master lease and licence agreements that the different between a tower being worth eight times cash flow and being worth 25 times cash flow is directly correlated to the quality of the paper.” In the quarter century since the GanziGellman-Ginsberg group got together “we’ve negotiated over 40,000 leases across the globe – in the data centre, fibre, tower and small cell space”, says Ganzi. “Having that purview of 40,000 agreements certainly affords you a lot of battle scars.” And the business plan is important. “You’ve got to have good market demand for the asset, you’ve got to have high quality management lined up, you have to understand back-office systems, you have to understand how to finance the asset class correctly,” he says. He likens Digital Bridge to putting “the best athletes on the field together with a value proposition that is appealing to investors and good for the long term growth plans of our customers”. Which takes us inevitably to polo. The majority of pictures in a web search of Ganzi show him horses and polo teams. Why? “My family has been involved in horses since I was a child.” His father started playing polo 30 years ago. “My wife and children play, and it’s become a family tradition. It’s a lot of fun, it’s a great thing to do on the weekend, and it keeps me closely connected to my children.” Ganzi’s healthy values around work-life balance are also key for Digital Bridge. “I demand every one of my team has a passion, other than going to work every day – whatever it is, polo, scuba diving, bike riding,” he says. “You do need time to disconnect, you need time to spend with your family.” But you’re not going to say anything about Zayo, are you? “No.”
www.commsinfra.com 26 June 2019 // Marriott Marquis // Atlanta
Key themes from the agenda
Capacity
Speakers include
Cara Manscini CEO & Co-Founder EDGEINFRA
Lead sponsors
Presented by:
Carl Roberts Partner HANDAARA CONSULTING
Andrew Kwok CEO HGC
Frank Rey Director Global Network Strategy MICROSOFT
Associate sponsors
Rahul Vijay Head of Telecoms Sourcing UBER
Ray LaChance Co-Founder & CEO ZENFI NETWORKS
Infrastructure industry readies itself for 5G Capacity
ǧ PREVIEWS THE FIRST COMMUNICATIONS INFRASTRUCTURE SUMMIT, WHERE WIRELESS, NETWORK INFRASTRUCTURE AND DATA CENTRE LEADERS COLLABORATE FOR 5G DEPLOYMENT
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eâ&#x20AC;&#x2122;re holding the first ever Communications Infrastructure Summit in Atlanta â&#x20AC;&#x201C; co-sited with, but separate from, our long-running International Telecoms Week event. The conference is a joint venture of Capacity Media and three other telecoms publishing and events companies that are part of the Euromoney Institutional Investor group. Why? Because we recognise that something very significant is happening in our industry at the moment. We have 5G services working in North America already, as well as in east Asia, western Europe and a number of other parts of the world. One of their main revenue generators will be low-latency, high-reliability, safety-critical, high-speed connectivity for the emerging internet of things (IoT). Make no mistake, the IoT is going to be massive. Berg Insight said in May that there were already 1.2 billion IoT connections â&#x20AC;&#x201C; thatâ&#x20AC;&#x2122;s one connection for every six and a half people on the planet â&#x20AC;&#x201C; at the end of 2018. In just four years, says Berg, there will capacitymedia.com
be 9 billion connections. Thatâ&#x20AC;&#x2122;s more than the total number of mobile phones we have now, more than the 7.9 billion people on the planet. Some of these applications will be dull â&#x20AC;&#x201C; how many kilowatt-hours of electricity you used last week â&#x20AC;&#x201C; but many will require high-precision fast connections. Think of a self-driving car whizzing along the freeway in Atlanta at 50mph â&#x20AC;&#x201C; in other words, just over 22 metres a second. Where does all that data sit? If your car is controlled by a data centre in Virginia with 100ms latency and the German car overtaking you is using a data centre in Frankfurt, how far do you travel before the brakes come on? Your
Local regulatory is cumbersome in the USâ&#x20AC;? Carl Roberts, Hadaara Consulting
car will travel 4.4 metres by the time it gets the signal back from Virginia. The car alongside even further. We need to think seriously about the safety implications. Weâ&#x20AC;&#x2122;re facing immense investment in 5G itself. US telcos have already spend billions on spectrum before starting on the network equipment. According to Deloitte, China alone will invest $400 billion on 5G in the next few years. But weâ&#x20AC;&#x2122;re also seeing a re-engineering of the whole infrastructure to cater for the new demands of 5G and its huge data requirements. Weâ&#x20AC;&#x2122;ll be putting 5G small cells on every street corner in major cities, every floor of big buildings. All will be connected by more urban fibre that weâ&#x20AC;&#x2122;ve ever installed â&#x20AC;&#x201C; connected to edge data centres no more than a few milliseconds from the end users. The team behind the summit have appointed an advisory panel â&#x20AC;&#x201C; the Communications Infrastructure Leadersâ&#x20AC;&#x2122; Forum â&#x20AC;&#x201C; to advise us not only on the inaugural Atlanta conference but also on following events. Some of them are featured elsewhere in this issue â&#x20AC;&#x201C; Marc
Image: Adobe Stock
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44 | feature: comms infra
Ganzi, CEO of Digital Bridge, on pages 40-41; Cara Mascini, CEO of EdgeInfra, on page 59; and Josh Snowhorn, CEO of EdgeMicro, on page 73. We’ll be featuring others over the coming issues, and we’ll report the conference in the next issue of Capacity. But how fast is it all happening? It’s clear from a number of experts in the field that 5G will take a few years to roll out to the world. Andrew Kwok, CEO of HGC Global Communications, thinks it will take until 2024-25 for 5G to reach 80% of the world’s population. Carl Roberts, the former Verizon and Epsilon executive who is now a partner at Hadaara Consulting, gives a more graduated view. South Korea will be first, achieving that 80% target in 2022. They are “quick adopters of new tech and have a manageable population size”, he says. Close behind are Japan and North America, where 2023 is the target date. “The local regulatory environment is cumbersome in the US,” he says. It’s worth comparing the promises that T-Mobile US has made to the Federal Communications Commission (FCC) as it negotiates its merger with Sprint. John Legere, CEO of Deutsche Telekomcontrolled T-Mobile US, who is destined to run the expanded company, said in May that its 5G network will cover 97% of the US population within three years – that’s by 2022 – including 85% of the rural population. And it would cover 99% of the US population by 2025, and 90% of the rural population. These are bold claims that will require huge capital investment to support them – “nearly $40 billion”, the company told the FCC. But they are “verifiable, enforceable and specific commitments”, said Legere. Kwok commented to me: “The cost of deploying a 5G network will be very high compared to 4G. The industry challenges will be the sustainability of growth in revenue and profit to continue enhancing 5G networks and services.” Roberts says he is “very confident” that the money will be available for 5G investment. “There is plenty of venture capital money available for investments in technology and when you consider the different piece parts of the future communications infrastructure, there is ample opportunity for a considerable return on investment.” Kwok is less sure. “It depends on whether and when there will be a killer application or killer device available to the industry,” he warns. “The take-off of 5G relies on the availability and progress of development of 5G ecosystems.” What will be key is “innovative government public services – such as smart city
services, car parking, lighting, surveillance, public security and so on” as well as the development of so-called Industry 4.0. He says “the trend of automation and data exchange in manufacturing technologies, including cyber-physical systems, the internet of things, cloud computing and cognitive computing will be one of the driving forces for 5G deployment in initial years”. Both Mascini and Snowhorn talk in their interviews on pages 63 and 77 respectively of the importance of small data centres in the future 5G
investments to avoid a glut of bespoke 5G infras,” he says. Ganzi on pages 42-43 is the exemplar of shared infrastructure, having been one of the leaders over the past 25 years of shared towers for the mobile industry. There are still some challenges ahead: costs of spectrum for a start, as well as regulation and the resulting return on investment. “Different business models will need to be crafted to accommodate the monetisation of all the different piece parts of a complex solution involving fixed and mobile networks, edge and
The cost of deploying a 5G network will be very high compared to 4G. The industry challenges will be the sustainability of growth in revenue and profit to continue enhancing 5G networks and service” Andrew Kwok, CEO, HGC Global Communications
Capacity
infrastructure. They will help reduce traffic load on networks as data volumes increase, and help to reduce the need for investment in more and more capacity, she says. Snowhorn expects “a complete land-grab” for small data centres at the edge of the world’s new 5G networks. Roberts says that “small data centres at the edge will drain a lot of business from the hyperscale mega-centres in place today as proximity linked with the performance of 5G will obviate the need to use centralized capability”. This will change the industry, he says. “What should evolve from this is a hub-and-spokes application service delivery model with (probably) some of the large hyper-scalers acquiring or building their own edge capability to not lose-out.” Future networks will see customer proximity applications move to the edge “while it will be only the large corporate payloads that will stay at the centre”, says Roberts. “Over time, even some of the larger, more centralised operations will probably move out to the edge as 5G deployment, smarter programming and self-deterministic artificial intelligence (AI) applications come into play.” Roberts agrees with Mascini on the need for shared infrastructure in the future. “Given the huge investment required, prospective investors in 5G infrastructure must consider shared
centralised computing and data centres, application performance, quality of service, service level agreements and risk responsibility,” says Roberts. There will be questions of interoperability standards, cyber security, software expertise, service availability and continuity, he adds. And – back to the initial illustration about cars speeding along that Atlanta freeway – he asks: “If 100% [continuity] is not possible, how many nines after 99% must be achieved, especially as autonomous transportation means lives are at risk.” A completely valid point – and something that should come up in the discussions in Atlanta at the inaugural Communications Infrastructure Summit on 26 June. We hope to see you there. The three partners working with Capacity Media on this event are Broad Group, which runs events for the data centre industry, Layer123, covering network virtualisation and softwaredefined networks, and TowerXchange, which organises meetings and provides information for the celltower industry worldwide. We’re all part of the Euromoney Institutional Investor group of information companies, and all these three, and Capacity Media for the carrier business, are working together as we enter the 5G world.
june/july 2019
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48 |
A marathon with hurdles, not a sprint Capacity
A RACE BETWEEN NETWORK OPERATORS HAS BEGUN. LAURENCE DOE INVESTIGATES THE LATEST 5G PARTNERSHIP DEVELOPMENTS AND HOW MUCH HANGS IN THE BALANCE WITHOUT A STRUCTURED APPROACH TO SPECTRUM ALLOCATION
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he starting gun has already fired for 5G. Most of its pioneers have already started or are planning their commercial launches for 2019, including operators on almost every continent. According to forecasts by GSMA Intelligence, the research and data arm of the trade body representing the interests of mobile network operators worldwide, there will be 1.2 billion 5G connections by 2025. In the same year, 5G networks will cover 40% of the global population, which is about 2.7 billion people and 37% of the Asia-Pacific population. The association has also found that the socio-economic impact of 5G will contribute $2.2 trillion over the next 15 years, with key sectors such as manufacturing, utilities and financial services benefiting the most from the new technology. By 2025, 5G is also forecasted to account for around 30% of connections
in markets such as China and Europe, and around half of the total in the US. “5G is more than a new generation of technologies; it denotes a new era in which connectivity will become increasingly fluid and flexible,” explains GSMA’s technical director Michele Zarri, technical director at the GSMA. “5G networks will adapt to applications and performance will be tailored precisely to the needs of the user. It will be a catalyst for innovation and enable richer, smarter and more convenient living and working. “5G is an opportunity for operators to go beyond connectivity and partner with other service providers across finance, transport, retail and healthcare to deliver rich new services. “It is also an opportunity for the entire mobile ecosystem to collaborate and trigger a wave of disruptive technology across devices, apps and services.”
New capabilities To get a better understanding of 5G’s benefits, I began a discussion with EE, which became the UK’s first operator to launch 5G on 22 May this year. Chris Sims, MD of enterprise strategy and marketing at BT, says that the operator is “really pleased” to be the first to win the UK’s race, but the group is “determined to stay ahead consistently”. “We’re deploying 5G through 3.4GHz spectrum on our macrosite network. It’s well-suited to that and we’re seeing really great results,” says Sims. “We are working with vendors and partners to make sure that we will continue to be first to evolve our network in line with standards. I think the key thing is that 5G is not a single point in time. 5G is defined by the 3GPP and we are launching 5G according to the standards as defined today.” The 3GPP, which stands for ‘3rd Generation Partnership Project’, is a june/july 2019
feature: 5g race | 49
Orange wants to help in the development of the ecosystem by sticking to one standard and avoid fragmentation by geography”
Image: Adobe Stock
Arnaud Vamparys, senior vice president of radio networks & 5G champion, Orange
standards organisation which develops protocols for mobile telephony. Its work on ‘Release 15’, which is the first full set of 5G standards, has been completed. The group’s focus is now shifting on to the first stage of Release 16, often referred to informally as ‘5G Phase 2’. So far, 83 studies relating to Release 16 and a further 13 relating to Release 17 have begun, covering topics such as vehicle-toeverything (V2X) application layers, 5G satellite access and wireless and wireline convergence for 5G. Sims says that BT has been speaking to thousands of customers about what these capabilities will mean for their businesses, which has led to the group being “absolutely overwhelmed” with the level of innovation 5G is creating within its customer base. “The use cases that have started to emerge include things like virtual reality and augmented reality for supporting lone workers, sales journeys and to support customer experience,” explains Sims, who sees a big opportunity to develop 5G in ‘Industry 4.0’ — a name given to the current trend of automation and data exchange in manufacturing technologies. “The internet of things just gives organisations a much better ability than ever before to collect data about the way their assets and the way their people are operating,” continues Sims. “That’ll allow them to drive huge efficiencies in their business and really drive a much better customer service and resilience within their operations.” But another revolution is happening in media and broadcasting, which is being made “much more straightforward”, according to Sims. “This is a massive opportunity,” he adds. “If you go to any major event you see lots of outdoor broadcast trucks. With the ability of 5G, multiple cameras can be stored in a single location with much lighter and affordable kit. This is a revolution in the outdoor broadcast market and from an enterprise point of view. For BT, it could really allow us to build on the media and broadcast services we provide today.” This capability has already been embraced by French multinational capacitymedia.com
telecommunications corporation Orange, which teamed up with the French Tennis Federation and France Télévisions to win the race to air the first ever live 8K TV images of the matches within the Roland-Garros stadium by using the operator’s 5G network. During the 15-day competition, Orange displayed its sports coverage at the stadium in two specially-created showrooms. For the first time at the French Open, France Télévisions’ 8K cameras, located on the Philippe-Chatrier court with their real-time data processing platform, broadcasted live to Orange’s local 5G transmitters, which were deployed in partnership with Nokia for the event. France Télévisions’ sports newsroom also tested, in realCapacity conditions, Orange’s new 5G broadcasting performance using mobile HD cameras. But what is the key to continuing the development of such networks? Arnaud Vamparys, senior VP of radio networks and 5G champion at Orange, tells me that fragmentation is something to avoid. “Orange wants to help in the development of the ecosystem by sticking to one standard and avoid fragmentation by geography,” says Vamparys. “If you want to give sectors of the economy access to 5G, there has to be dialogue between the operators and the sections of the economy so that any problems can be addressed. “We are committed to giving 5G access to everyone, to really help the ecosystem
on this learning curve. 5G is a technological leap and will be significant for many companies and many sectors of activity. “We want to write the story of 5G together. by uniting and consolidating our resources in the development of different countries. You can’t differentiate 4G from 5G without the correct development taking place. It will be defective, impacting the standard that is being developed as of this moment.”
Banding together for the best If the new capabilities of 5G are to be explored by operators such as Orange and BT without hinderance, then 5G spectrum auctions across the world need to be held and executed in the correctly. The successful rollout of ultra-fast 5G services also relies on timely access to the right amount and type of spectrum. Variations in how much spectrum has been assigned, the onerous conditions imposed – and the cost of access to that spectrum – means the speed, reach and quality of 5G services could vary dramatically between countries. The GSMA has already raised concerns into some auctions’ designs artificially inflating prices or inefficiently distributing already scarce spectrum resources, which risks harming consumers. It has also outlined several key considerations for governments and regulators. “Governments need to come together to make spectrum decisions that will have an impact on mobile broadband growth,” Zarri says, “specifically, radio frequencies for high-capacity 5G are at stake, frequencies which operators require to offer world-leading 5G communications services. “5G networks can use this radio spectrum to offer performance levels that until now have not been attainable. Areas such as high-capacity broadband, industrial automation and intelligent
GSMA’s ‘Auction Best Practice’ paper highlights: • The top priority for spectrum auctions should be to support affordable, high quality mobile services – not to maximise revenues;
Set asides for vertical sectors or new entrants may threaten how much operators can access and also risk inflating spectrum prices;
• Auctions should not be the only awards process considered, as they are not always suitable;
• The auction design should not create unnecessary risk and uncertainty for bidders; and
• Assign a sufficiently large amount of spectrum and publish roadmaps to support high quality mobile services;
• Poorly chosen lot sizes or inflexible packages of spectrum lots risk inefficient outcomes.
transport systems can all break new ground with innovative services using mmWave spectrum.” Having enough harmonised 5G spectrum in these bands is critical to enabling the fastest 5G speeds, low-cost devices and international roaming and to minimising cross-border interference. Global harmonisation of these bands will create the greatest economies of scale and make 5G more affordable across the world. Unlocking spectrum for the mobile industry to deliver innovative 5G services across different industry sectors could add $565 billion to global GDP and $152 billion in tax revenue from 2020 to 2034, according to a report by the GSMA entitled: ‘Socio-Economic Benefits of 5G Services Provided in mmWave Bands’. mmWave 5G will not only provide consumers with ultra-fast mobile broadband services but will stimulate a host of applications, including enhanced remote healthcare and education, industrial automation, virtual and augmented reality, and many others. One such example can be found in the Port of Hamburg, Germany’s largest port. The Hamburg Port Authority, German telco Deutsche Telekom and Finland’s Nokia commissioned an 8,000-hectare area with which to carry out key tests of various aspects of 5G functionality, including network slicing, in February 2018. The trial in Hamburg tested several network slices under ‘live’ conditions in an industrial setting, a first in Germany. Traffic light management, data processing from mobile sensors and virtual reality were all provided connectivity by an antenna, which was installed at the top of the 150-metre-tall Hamburg television tower. In addition to an already impressive list of applications, Phil Twist, vice president of marketing and comms, networks at Nokia, tells me that 5G was also used by the port to monitor the temperature and location of the shipping containers, “combining various different use cases for 5G in one location and replacing what would have to be either no service or fixed service”. This was only possible because of dedicated virtual networks, known as ‘network slices’, in the 5G testbed, a key architectural feature of 5G that enables networks to dynamically and flexibly adapt to the requirements of many different applications. “If you imagine a harsh factory environment, the equipment must be cabled up, which means you have to turn the factory off, clean it up and run the cables, leading to no flexibility on where the equipment goes,” explains Twist. “If
Image: Adobe Stock
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You need a latency of two milliseconds or less ... which is able to switch the robots off and stop them hitting the person working” Phil Twist, vice president, marketing and comms, networks, Nokia
Capacity you have a modern, flexible production environment with robots that are connected to 5G, they can move. “If you have a second overlay using a network slice, which is very low latency and a security blanket, it means that robots can run alongside people on the floor and be able to react fast enough so that people can’t get hit by the robots because the response time is fast enough.” Although Twists’ statement around robotic safety is one many would like to question rather than trust, Nokia and Bosch Connected Devices and Solutions GmbH Combination have already put the smart sensor technology to the test. “The studies we’ve done shows that you need a latency of two milliseconds or less for this security slice, which is able to switch the robots off and stop them moving fast enough to have any chance of them hitting the person working,” continues Twist. “What that means is you can have flexible production with people working alongside robots, or you could end up with a ‘dark factory’, which can have the lights off due to robots being able to talk to one another through a centralised control.” According to the GSMA, 5G applications such as this are helping to fuel the early lead being established in the Asia-Pacific and Americas regions. They are expected to generate the greatest share of GDP attributed to mmWave 5G, at $212 billion and $190
billion respectively. Europe is forecasted to have the highest percentage of GDP growth attributable to mmWave of any region, with 2.9%. However, the advantages are not restricted to early-adopting mobile markets and, as the rest of the world deploys 5G in subsequent years, economies of scale derived from spectrum harmonisation will stimulate even faster growth. Regions such as Sub-Saharan Africa, Central Asia, Latin America and the Caribbean could see growth in GDP contribution from mmWave 5G applications of over 65% per year from 2026 until 2034.
The finishing line Over the course of writing this article, I have come to understand that my perception of 5G as a race between the ‘competitors’ — countries and companies — is completely wrong. The closest it could be likened to is the sprint hurdles at the Olympics with a relay race twist. It will take important industry discussions to ensure countries can leap over the obstacles presented by spectrum allocation and limitations. While this takes place, companies will need to continue working together with organisations such as the 3GPP to learn how they can push the limits of what they can achieve by following the standards that will ultimately dictate how fast they can run. june/july 2019
Capacity
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BULK – THE ENABLER OF THE NORDICS With an abundance of renewable energy, favourable regulatory conditions and prime location to other continents, Jon Gravråk speaks to Natalie Bannerman about why the Nordics is becoming a prime location for subsea cable infrastructure
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he global market is finally beginning to realise the potential of the Nordics. A region with favourable regulation, talent and resources as well as its position as gateway between the US and other parts of Europe mean that many are just waking up to the opportunity. One such company that has been active in the region for over 12 years is Bulk Infrastructure, a leading provider of sustainable digital infrastructure in the Nordics. A champion of the region, Bulk actively works to bring more data processing and traffic to the Nordics. “We want to see data processing coming to the Nordics and we want to be an enabler for making that happen,” says Jon Gravråk, CEO, Bulk Infrastructure. As far as Gravråk and the rest of the Bulk team are concerned the benefits of bringing more traffic to and through the area, are too good to ignore. “We believe the Nordic region is optimally geographically positioned,” adds Gravråk. Here, we have short distances to Europe and other countries,
abundant renewable hydropower supply and the lowest electricity prices in Europe. But the most important thing is the regions connectivity, redundancy and resilience. I believe all these things together, topped with political stability and low temperature is reasons why the Nordics is chosen.” One of the most recent announcements from the company is that it struck a deal with AWS to use Bulk’s share of the Capacity HAVFRUE cable and data centre facilities; a huge win for the Nordic region. “Over all, this agreement is a great proof of concept for Nordic connectivity,” explains Gravråk. “Then for Bulk of course it’s a huge learning opportunity working with a global content player in this space, which AWS is. For Bulk its part of putting our company on the map, to be seen as the enabler of the Nordics – this is our aspiration. Finally, it kick-starts our operations at our data centre campus in Kristiansand, N01 Campus. In sum, this deal is testament to what we have been doing for years and we are clearly going in the right direction.”
Bulks data centre campus in Kristiansand, Norway
We want to see data processing coming to the Nordics and we want to be an enabler for making that happen” Jon Gravråk, CEO, Bulk Infrastructure Speaking of data centres, in March 2019, the company broke ground for a new data centre in Esbjerg, Denmark, its first site outside of Norway. “It’s really a very natural extension of our business, explains Gravråk. “There was a special reason for us to launch a data centre in Esbjerg, Denmark. This place has a unique location for topography. It’s a location where at least 4 new international subsea fibre systems will land. This includes HAVFRUE (US-IRE-DK-NO), Cobra (that connects to Amsterdam), Skagerrak 4 (Denmark and Norway) and DANICE (Denmark and Iceland).” There’s no doubt that the relationship between OTTs and telcos have changed since their entry to the market – a factor driven by a shift in subsea fibre systems. Like the rest of us explains Gravråk. Is curious to see how telco players plan to play a role in the global digital infrastructure going forward. “Obviously, the growth in traffic is exponential and a big part of that is driven by the OTT`s. So unlike before where you would perhaps have a more granular type of demand, you see a much more consolidated demand from the OTTs and so it is natural for them to become owners and take more ownership of what’s going on,” he says. Subsea providers are often left on the fringes of the 5G conversation with discussion mostly taking place in the june/july 2019
executive interview: jon gravråk | 53
mobile space. However, 5G and other emerging technologies will drive the need for more subsea infrastructure, according to Gravråk. “5G and other network technologies like AI, Machine learning, autonomous vehicles and all those technology trends, they all have one thing in common, they generate a lot more data and they make the real-time aspects of that data even more important,” he says. “What that means for subsea fibre systems is that we need to build out and support those systems because they too will need to grow.” According to Openwave Mobility’s Mobile Video Industry Council (MOVIC) Livecast back in April, Operators believe that cloud gaming could represent 25% to 50% of 5G data traffic by 2022, based on the rapid progression of cloud gaming services in recent months. Questioning Gravråk as to whether this gaming trend is having any impact on the infrastructure market from Bulk’s perspective he said: “I don’t think gaming as a single consumer application influences our infrastructure in the same way as for example the cloud players. Bulk focuses on the big A to B highways for data transportation. "Gaming is probably more relevant when looking at the last mile and metro networks, something we are not into.” Speaking of A to B connectivity, Gravråk like many subsea players is in favour of data centre to data centre connections and is a trend Bulk continues to follow. “We see that getting the cable all the way into the data centre happens because more equipment relating to the cable itself benefits from data centre standards regarding infrastructure, accessibility, etc,” he says. “Building these cables moving forward to the data centre, there will be more opportunities of fully leveraging the traffic exchange opportunities of the subsea fibre systems.” As a true full infrastructure provider Bulk has a number of data centre assets including its hyperscale data park, N01 Campus in the south most part of Norway, its Oslo Internet Exchange is the largest data centre location in downtown Oslo and of course the aforementioned DK01 Campus, in Esbjerg, southwest Denmark. As such the evolution and continued adoption of the cloud is driving growing data consumption. “It’s obvious to us that these cloud players are enabling a lot of the growth within data processing altogether. I think they are doing it in a fascinating capacitymedia.com
way, they are providing services in a completely different way. It’s an accelerating growth and they facilitate digital transformation.” From Bulk’s perspective a key part of their business is to create the infrastructure for those players and meet any needs they may have. “We need to give them as good infrastructure as they need – we need to do it in the shortest timeframe in the most efficient way – that’s the way we compete and earn the right to be their partner,” he adds. Unlike the rest of the industry, Gravråk isn’t as taken in by the hype of the edge because as far as he’s concerned it have yet to be clearly defined and varies depending on the use case. “There may be some instances where data processing needs to happen close to the end user or closer to where the data originates from. It all depends on the different use cases and their requirements in terms of latency etc." "But at the same time, you’ll see needs for bigger engine use, to serve the big data processing with perhaps less latency sensitivity.” Though Gravråk is still on the fence with regard to theCapacity edge and what it will look, in terms of Bulk’s network infrastructure, terrestrially speaking, he says they are thinking about it and exploring opportunities in the space around metro, city centres etc.
Bulk's network infrastructure map
The roadmap for Bulk Infrastructure across its various sectors remains the same, to become the enabler of the Nordics “meaning that we will continue to build and try to be effective with our time to market as a data centre player," adds Gravråk. "We also want to steadily grow and increase our partnerships with anchor tenants,” he says. As for subsea fibre part of the business, the company says it will continue to make strategic investments into new systems that align with making the Nordics attractive for data processing. “We are constantly looking for new opportunities to improve Nordic connectivity with the rest of the world, and we prefer doing this with other players that see large growth opportunity in the region,” says Gravråk.
Connecting the Nordics - A recap Ahead of Subsea EMEA, Nigel Bayliff, CEO of Aqua Comms; Jon Gravråk, CEO of Bulk Infrastructure; Erling Aronsveen, CEO of Celtic Norse and Geir Holmer, CEO, Skagenfiber, joined Capacity for a webinar about connecting the Nordics and the work these companies are doing in the region. According to Bayliff, the OTTs are driven towards renewables/energy-efficient locations making the Nordics a very attractive location for investment. The growth of data transmission is continuing at a CAGR of 41%, in addition to the rise of independent infrastructure partners in the space. He added that within a few years the existing cables across the Atlantic will be ‘inefficient to light and expensive to operate, burdened by legacy’ – as such Aqua Comms is focussed in the Northern Atlantic, creating a dual-routing capability from key strategic locations – Dublin, London and Denmark. One of the newer systems due to be RSF is
Celtic Norse, a 2,000km cable linking the city of Øysanden, in Melhus municipality in Norway, just south of the city of Trondheim and Killala Bay, County Mayo in the Republic of Ireland. According to Aronsveen the system has already has a desktop study completed as it well on its way, with RFI out to 5 vendors (responses due back in June 2019) and he confirms that they are actively seeking anchor their first tenants. As for Holmer, over at Skagenfiber the team pushes ahead with the development of its Skagenfiber East and Skagenfiber West cable systems between Norway and central Europe. The system has garnered strong public support from a number of public bodies including Ministry of Transport & Communication, the Armed Forces, ICT Norway and Highways Agency. With an RFS of Q3 2020, he says they are well underway with its Installation vendor and cable manufacturer selection process, as well as sales.
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EllaLink: 72Tbps cable system on track to be RFS by 2020 Jason McGee-Abe spoke to Philippe Dumont, Group CEO, to find out more Capacity
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start our meeting by asking Dumont where he’s based. He jokingly responds: “I’m based on the plane.” This is simply because of the extensive travelling he undertakes to visit key locations along the 9,300km cable system, the company’s headquarters in Ireland, and t be with his family in France. It’s been a very busy year-and-a-half for the former Alcatel-Lucent Submarine Networks (ASN) president and CEO. He first joined the project in January 2018, initially as a consultant, to support the preliminary due diligence that was being completed by the Marguerite infrastructure fund. After just a couple of months, the original developers of the company proposed to Marguerite, which is the majority investor of the cable, that Dumont lead the project. From March 2018, as a result of his experience and network of the subsea cable industry, that wish was realised. EulaLink, the developer and holding company of EllaLink, appointed him as its new chief executive officer and he was elected to its board of directors. “Since then, the challenge has been to contractualise and sign all the agreements
that were on the table in January 2018.” These are needed to instigate the build of the cable, so I ask him what the take up has been like. “It’s been very successful,” he retorts. “There was one draft contract in place when I took over the project and we signed everything outstanding around September 2018.” As it’s a private cable, there was a lot of documentation to collate and process but it was completed on 31 December 2018 and the cable was contracted into force. Since then, the main areas of focus for the Group CEO has been “to organise the group project management (GPM) of the cable itself ”. Dumont says: “We entered the two-year build phase of the cable at this time but there was a lot to do. You have to manage your sub-contractor, ASN being the main one for us, but there are many things around cable landing stations and terrestrial backhauls, to name just two things, to take into account.” ASN has now finalised the cable route study now and mobilised the marine survey vessel for the EllaLink submarine cable system. The survey will be performed over the coming months and permit acquisition continues in line with EllaLink’s plans to be ready for service (RFS) by the end of 2020.
EllaLink is a state-of-the-art four fibre pair submarine cable system designed to satisfy the growing demand for traffic and offer a secure high capacity connectivity on a unique low latency transatlantic route between Europe and Latin America. By March 2019, Dumont brought in the right level of expertise and number of people for the project. But what’s the current strategy? “At this moment we’re not necessarily focused on selling capacity – 10G or 100G – we’re still trying to sell more branches on the cable or more fibres. These usually consist of $10+ million sales,” Dumont tells Capacity. One such example is the announcement that EMACOM is looking to enhance its partnership, which presently consists of one fibre pair that will be able to carry 24Tbps. This will help to meet the growing capacity demands of the islands of Madeira. Dumont adds: “EMACOM now has an increased share in the EllaLink cable system. Additional fibre pairs at a very competitive price will position Madeira as an ideal regional hub, offering direct connections to Portugal and onwards to Spain, Cabo Verde and Brazil.” EMACOM is exploring taking a second and third fibre pair at present. Cabo Verde Telecom (CVT) and june/july 2019
SPONSORED INTERVIEW: PHILIPPE DUMONT
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Director, operations, wireless transmission, Alcatel-Lucent
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VP, wireless transmission, ETSI business unit, AlcatelLucent
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President, wireless transmission, AlcatelLucent
2009
President & CEO, Alcatel-Lucent Submarine Networks
2016
Industrial adviser, EQT Partners
2018
Adviser, Marguerite
2018
Group CEO, EllaLink
We’ll be trying to tie up agreements for our North Africa extension by the end of this June” Philippe Dumont, Group CEO, EllaLink Group
EllaLink have also signed an agreement to deliver connectivity from Europe and Latin America to Cabo Verde via the EllaLink submarine cable system. The low latency EllaLink route avoids the congestion of the North Atlantic by offering the first ever direct fibre pair between the two continents. The EllaLink network directly connects Brazil and Europe linking the major hubs of São Paulo and Fortaleza with Lisbon, Madrid and Marseille. Once live, it will enable low latency, data privacy and high capacity transmission for a broad range of customers between the major financial and population centres of Europe, South America and the Caribbean. So what other regions is Dumont looking at? “We’re not looking to go to a brand new region but we’re looking at the connectivity options on the northwest coast of Africa on the Atlantic side,” he capacitymedia.com
responds. “We’re looking at entering the market there as lots of people there are limited by their subsea cable capacity choices.” But when will EllaLink start to get contracts in place? “We’ll be trying to tie up agreements for our North Africa extension by the end of this June,” he answers “as he hopes to freeze in the design with ASN before the end of June”. Capacity This means the CEO will no doubt be rolling up his sleeves at ITW in Atlanta to ensure EllaLink’s partners and customers don’t miss out. Capacity’s Subsea EMEA event in Marseille will also provide a platform for Dumont and his team to advertise the latest developments to its partners and customers. “If you say EllaLink serves as a direct connection between Europe and Latin America, bypassing the US, then one of the key markets for us is Marseille,” Dumont adds. But why? Marseille has vast amounts of traffic coming in from Asia and “the number one investors in SEA-ME-WE 5 and AAE-1 are the Chinese operators, so EllaLink is a very attractive proposition for them”. If we can move the traffic from Marseille to Latin America via Portugal, without touching the US, this becomes a very significant strategic route. The EllaLink Group is planning two extensions from Fortaleza. The first is to São Paulo and the second named ‘GuyaLink’, which is a branch of the EllaLink system that will start at the nose of Fortaleza and go to French Guyana. French Guyana is home to the European Space Agency spaceport (CNES). “GuyaLink isn’t really being driven by traffic demand, as there’s very little capacity required, it’s more strategic,” the CEO adds. “Traffic from French Guyana will go directly to Europe without any stops, which is hugely beneficial when compared to the existing route of Fortaleza
to Miami and then on to Europe.” It’s currently an expensive route with poor latency and inadequate security. Dumont tells me GuyaLink received €25 million of funding to help the system, which leads me to ask how much the system has called roughly to date. Dumont responds: “Without the Guyana link extension, it is in the range of just above €150 million.” Dumont says it’s not just about latency but price: “If you’re in Europe and you want to bring traffic to South America, we’re going to be the cheapest alternative in the market for sure.” Overall, it’s a great time for the subsea world, with many cables being built. The fact that the EllaLink has finalised so many contracts ahead of the cable system’s RFS date is quite simply testament to how important this strategic low latency route will become. We look forward to seeing how much this will boost the industry.
“BELLA spectrum on the EllaLink submarine cable system will be a game-changer for the research and education communities of Europe and Latin America. The direct route between the two regions will significantly increase bandwidth and reduce latencies” Erik Huizer, CEO of GÉANT; Luis Eliécer Cadenas, CEO of RedCLARA Building the Europe Link with Latin America (BELLA) provides for the long-term interconnectivity needs of the European and Latin American research and education networks, GÉANT and RedCLARA, by procuring long-term access to spectrum on a direct submarine cable between the two regions and deploying a 100Gbpscapable network in Latin America. BELLA is funded by the European Union (DG CNECT, DG DEVCO and DG GROW) and research and education networks in Latin America. www.bella-programme.eu @BELLA_Programme
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special report
DATA CENTRES June/July 2019
CONTENTS 59 Executive interview: Cara Mascini, co-founder and CEO, EdgeInfra
60 Big interview: Corey Dyer, EVP global sales and marketing, Digital Realty
Capacity
62 Fewer, bigger, better Capacity examines the current wave of consolidation taking place in the data centre market
70 Global hot prospects Capacity rounds up 10 of the most innovative global data centres
73 Executive interview: Josh Snowhorn, founder, Edgemicro and CEO, EdgeInfra
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executive interview: cara mascini | 59
EDGEINFRA FOSTERING COLLABORATION Cara Mascini, former CMO of AMS-IX, believes the successful business model for the densified networks of the future will depend on collaboration and openness
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mall data centres will help reduce traffic load on networks as data volumes increase and help to reduce the need for investment in more and more capacity, says Cara Mascini. They “will enable the localisation of compute, storage, networking and interconnection”, she says. “They will enable parties to localise their applications and their workloads and keep data in the area where it is relevant.” Mascini is co-founder and CEO of EdgeInfra, an Amsterdam-based company that is investing in multi-tenanted edge infrastructure. She spent 10 years as chief marketing officer at AMS-IX, the Amsterdam Internet Exchange. Job Witteman, the other co-founder of EdgeInfra, was previously founder and CEO of the AMS-IX company. “Edge data centres do not replace regional or core data centres in any way, says Mascini. “They are an additional uniquely local layer in the communications infrastructure. Edge data centres will be in places where no current data centres or interconnection exists. Regional or core data-centre players are business partners for edge data centre players and vice versa. The offers are complementary.” Some applications or workloads will need localisation, low latency, local processing or local storage. Then “an edge data centre adds value, but some of that also needs to go back to the core of the cloud or internet, and not all applications are in need of those aspects and that is where the current data centres come in.” Mascini, who will be a speaker at our Communications Infrastructure Summit in Atlanta, sees edge data centres as one element of the new, densified networks of the future – and densification will also apply to fibre networks, cell towers and small-cell antennas. There will be “new sharing and collaborative business models around the densification”, she adds. Indeed, capacitymedia.com
collaboration will be vital for a range of communications infrastructure throughout the next decade. She wants a world with “the will to work openly, collaboratively, no more walled gardens and the use of shared infrastructure”. The financial challenge is enormous and there are technical issues that need to be solved, she adds. “Those will be more easily overcome by sharing both the financial Capacity burden and collaboratively work on the technical issues ahead. Using the neutral host principle can be one of the ways forward as we have seen this working in the past.” The densification and virtualisation “will lead to an infrastructure that is flexible and customisable in real-time”, says Mascini. We will see “automation of processes over the whole value chain … making complete elastic infrastructures possible, whether they are mobile or fixed networks, edge or cloud compute or storage.” So what applications will be enabled by these new densified networks in the 5G era? Entertainment for one, she says: gaming and TV in combination with augmented reality and virtual reality (AR and VR) “as well as social interactivity”. We will have “fully immersive, real-time and interactive experiences of 4K/8K ultra high definition” for live events. Viewers or players will have a virtual presence thanks to “drones serving 360-degree images”, Mascini adds: “All very computational heavy and latency sensitive, for which users are willing to pay.” The future will be a world of personalisation. “Personal assistants, personal advertising, personal retail, personal experiences [with] natural language apps offering personal information, products, experiences and automation, easing life through the use of artificial intelligence using many sources of data that is making decisions and taking action for us.” Home, building and public security are
on her list, with “instant analysis and threat detection, real-time high definition surveillance, AI driven auto-alerts”. And of course “personal health monitoring, prevention, remote doctoring, AI driven diagnostics and decision making”. Mascini believes “there is a willingness to pay for applications improving quality of life”. Surprisingly, she believes that mobility is “not one of the very first drivers but certainly one of the important ones”. Connected autonomous vehicles and traffic information systems will increase road safety and efficiency, she says. These services will be dependent on low latency and high levels of computing power, so they will “need both 5G – not a Wifi-based technology – and very local high density edge compute” – and that means “both infrastructural as well as device-based edge compute”. And “last but certainly not least”, says Mascini, “private 5G network slices will lift a lot of the limitations of Wifi in the business environment, combined with local edge computing supporting cloud based business applications and IoT [internet of things] deployments of many kinds”. But there are challenges, she adds – in particular, people. “The communications infrastructure is not the most sexiest of industries to work in. The more physically related civil technology areas such as fibre, cell tower and data centres even more so than telco.” That means resources might be limited, and that “may pose a real barrier to fast roll-out, both in the near but more so in the future”. What can we do about that? “We need to actively focus on improving the sector’s reputation in this respect and build programmes to interest students at a very young age.” One more thing: “I will not mention diversity,” she adds, thereby mentioning diversity – a challenge for many in all sectors of this industry.
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Digital Realty - the trusted infrastructure partner Corey Dyer, EVP of global sales and marketing at Digital Realty, speaks to Natalie Bannerman about how the Capacity company is supporting its clients in their journey to the cloud
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igital Realty has quickly become one of the preeminent names in the data centre and colocation space. With over 210 data centres across five continents and present in 13 countries around the world, the company is heading for a period of steady growth and expansion. Speaking to Corey Dyer, executive vice president of global sales and marketing at Digital Realty, he talks us through some of the biggest trends in the space and how the company fits within the space. One such trend is software-defined networking (SDN), which is quickly becoming a much-demanded feature in the management and provisioning of services. According to Dyer, it is a means for added flexibility and accessibilty. “I think SDN has been a wonderful way for customers to have that flexibility about how about they go about accessing each other, accessing networks and accessing public clouds. It’s been great for us because it’s given us more options to services and support our customers.”
For the last few years, Digital Realty has been hard at work cultivating a number of strategic partnerships with companies that support its wider growth plans. Back in 2016, the company partnered with cloud connectivity enabler Megaport to launch an interconnection platform to facilitate direct, private and secure connections to multiple cloud service providers. The following year Digital Realty acquired a small stake in Megaport for a reported $8 million. Dyer says that the decision to work so closely with Megaport is due to its ability to provide access to multiple cloud ecosystems. “The key driver is that it’s really enabled us to help customers get to multiple clouds, multiple different networks and ecosystems. It’s been a huge boost for us and our business,” he explains. “One of the big trends I see at the moment is multi-cloud and hybrid cloud architecture, so Megaport’s partnership with us has enabled us to have those conversations and offer those solutions for our customers.” Most recently, Digital Realty achieved the AWS Direct Connect Service Delivery Designation. The new accreditation means
that the company has authorisation to provide new AWS Direct Connect Hosted Connections of more than 500Mbps. The new offering comes as a real value add in Dyer’s view, expanding the already vast set of connectivity options it already has. “We gain a huge advantage if we have more direct connects, more on-ramps for all of these cloud providers, and more of them colocated in our facilities,” says Dyer. “It gives greater flexibility for our compute cycles; and it gives our customers a lot more options around security, speed and performance. We’re one of the few to offer this AWS solution.” One the company’s biggest acquisitions to date has been the $1.89 billion acquisition of Telx back in 2015. The deal nearly doubled the size of Digital Realty’s retail colocation and interconnection services business. Talking to Dyer about the acquisition and how it has shaped the business, he says that it has turned the company into a full service provider and expanded its suite of offerings. “It really helped us build-out our global platform and help provide us with a full product offering - everything from a single june/july 2019
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2005 - 2008
Regional sales director, Dell
2012
Vice president of storage sales Canada, HewlettPackard
2014
Regional vice president of Sales, Equinix
2016 - 2018 Present
Senior Vice President of sales, Americas, Equinix EVP global sales and marketing, Digital Realty
global platform so they can take advantage of it, which is really exciting for us,” he adds. “We will continue to sell add-on services and add-on locations for our clients.” However, he hastens to add that this may not exclusively happen with Brookfield Infrastructure, explaining: “we will continue to figure out the best way to make use of funds and our investment in the most efficient way possible.” Turning to the market as a whole, interconnection at scale is a growing trend that colocation providers need to be aware of. Providing campus-based colocation and interconnection offerings adjacent to global cloud providers’ massive storage and compute engines, is something that Dyer says is already in motion. Earlier this year the company acquired a 13-acre property from Airbus Americas for a record price of $2.14 million per acre with this purpose in mind. “If you think about the land that we
We are one of the major partners that the cloud providers Capacity work with as they continue to build out their infrastructure”
Corey Dyer, EVP global sales and marketing, Digital Realty
rack to a multi megawatt hyperscale,” he says. “It has also enabled us to have a lot more interconnection and directly connect with our customers across the board. Year-on-year our colocation and interconnection business continues to grow.” In keeping with the company’s active involvement in the M&A space, at the start of the year, Digital Realty completed a $1.8 billion acquisition of Ascenty, the leading data centre provider in Brazil, through its Brazilian subsidiary, Stellar Participações. Less than four months on and the company sold a 49% stake in Ascenty to Brookfield Infrastructure that committed to fund half of the equity investment. While questioning him on the deal and how it plays into the company’s plans for the region, Dyer explains that the decision supports the expansion of its global platform. “So we’re really working building out the platform,” he says. “A large portion of our customers - the ones that benefit the most - take advantage of our global footprint. “Given that Brazil is growing the way that it is and the way Latin America is, I think being there at the forefront, giving them a capacitymedia.com
brought in Ashburn, that’s a great example of where we are going to create a connected Metro,” Dyer says. “We are going to have multiple ecosystems, multiple cloud providers, all connected right there, locally on the same campus.” The plan, he says, is to give customers really easy and differentiated access, where they can go directly to any of the cloud providers on the same campus, delivering much lower latency, higher performance and more secure connectivity options. “I think it will start enabling different applications to be used in different ways as well as how customers take advantage of those applications,” he adds. With 95% of data centre traffic predicted to be cloud-centric by 2021, according to Cisco’s Global Cloud Index from 2016 to 2021, Dyer says that Digital Realty is preparing for the data onslaught and building for future hyperscale requirements by simply doing what it has always done. “We’re continuing to do what we’ve been doing,” he says. “We are one of the major partners that the cloud providers work with as they continue to build out their
infrastructure. Its partners like us that continue to keep them nimble and agile, they also trust us because we are best at building, designing and operating data centres for them and with them.” It is also the company’s work with the likes of Ascenty which helps to ensure that they are a good partner for the cloud providers. In keeping with the theme of data onslaught, the explosion of IP traffic has created the need for highly scalable, reliable and cost-efficient internet exchange solutions. To support this Digital Realty is expanding its IX platform to more facilities. At the start of the year, the company expanded its internet exchange platform to new data centre facilities located in Ashburn, Virginia, and Chicago, Illinois, adding to its many exisiting locations. “We will continue to do that where it makes sense and to give our customers alternatives to drive IP traffic, right across the board,” explains Dyer. Ever the optimist, Dyer sees no challenges for the company only opportunities that need to be optimised and maximised. “I feel like there is just a huge opportunity,” he adds. “We’re focused on making sure that we take advantage of the growth explosion that’s out there in the cloud.” Other key areas of development are the move to hybrid cloud and multi cloud environments, albeit according to Dyer, in the early stages of development. “It’s all about meeting the needs of the customer and growing and supporting them as much as we can,” continues Dyer. “So when they come in and are a part of our ecosystem or part of our platform - they continue to look to us as a trusted and valued partner of theirs.” Therefore, the biggest concern from Dyer is: “How do we do everything we can to capture that driving demand as quickly as we possibly can”. Looking ahead, Dyer predicts that in the next 3-4 years the data centre market will continue to grow at the rate it is now, with hybrid and multi cloud playing a big part of that growth. “I think it is going to continue to grow and accelerate at the pace is it currently moving at,” Dyer says. “We’re going to see more and more use of hybrid and multi cloud, and that continue to expand.” As for the roadmap for the rest of the year, heading into 2020 from Dyer’s standpoint will be a mix of organic growth and development of its offerings. “I think you are going to see a mix of organic growth from us,” he says. “We will continue to partner with our customers to drive demand, find out where that demand is, what markets they want us to be in and what solutions they would like to see from us as well as the partnerships we need to make in order to see that happen.”
Image: Adobe Stock
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Fewer, bigger, better Capacity
AS THE DATA CENTRE SECTOR CONTINUES TO CONSOLIDATE, GUY MATTHEWS TAKES A LOOK AT SOME OF THE MAJOR DEALS THAT HAVE CHANGED THE SHAPE OF THE MARKET, AND CONSIDERS THE DRIVERS THAT WILL DEFINE THE SECTOR’S FUTURE.
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he last few years have seen a surging tide of takeovers among data centre operators as they seek scale and try to broaden the markets they address. The number of merger and acquisition deals in the data centre sector maintained its upward curve in 2018, according to data from independent analyst firm Synergy Research Group. It recorded the completion of 68 major deals during the period, with a total value of $16bn. Synergy identified a clear trend towards enterprises not wanting to own or operate their own data centres, and instead focus on providing services to employees through outsourcing to specialists. Over the past five years, the largest investors have been Equinix and Digital Realty, the world’s two leading colocation providers. In aggregate they spent almost $23 billion on acquisitions of other data centre operators over that period. Other notable data centre operators who have been major acquirers include CyrusOne, Iron Mountain, Digital Bridge/ DataBank, NTT and Carter Validus. So what is driving all this activity? “Our acquisition strategy has been
powered by three factors,” explains Andy Power, chief financial officer of Digital Realty. “For one, we felt that we had to become more global for our customer base. Our customers, from the hyperscalers to the smaller service providers, are all doing business in multiple regions. In that vein, we just acquired Ascenty in Brazil. Secondly, we’ve been looking to build the widest possible product set to appeal to the maximum number of customers. The third factor is all about scale. Everything in this business is about size.
We used to deliver 1MW data halls, then that went to 3MW, then 6MW. Our latest flagship on our Ashburn campus, outside Washington DC, is 100MW. Operating at scale is crucial to compete in this business, and consolidation is helping to achieve that. That was behind our purchase of DuPont Fabros in the US.” Russell Poole is MD UK and the Nordics at global interconnection and data centre company Equinix, and he attributes the acquisition boom in part to the dramatic changes and technological developments that are affecting the whole
5G also opens the door for new applications that demand absolute reliability” Russell Poole, MD, UK & Nordics, Equinix
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ICT sector. “The data centre market has been growing significantly due to the massive increase in data traffic and the advent of cloud computing,” he observes. “This has led to a remarkable increase in data centres. Cloud has become a necessity for enterprises and with this need to turn to the cloud, data centre infrastructure has been increasing rapidly.” Poole thinks that the most exciting changes for the sector are still to come: “The launch of 5G, in particular, will have one of the biggest impacts as it will mean increased use of technology on the move,” he predicts. “It will open endless possibilities with massive investments needed to ramp-up new edge infrastructure and to prepare for the high radio density required for 5G. It also opens the door for new applications that demand absolute reliability, such as in healthcare, energy or autonomous transportation. 5G is not just about faster data connections and consumer internet services, it is the key to endless possibilities for digital transformation especially in a growing IoT and AIconnected world.”
New regions Europe is no exception to the acquisition boom, with Interxion, for example, acquiring the data centre business of Vancis Holding, an independent Dutch provider of colocation, cloud and managed services based in Amsterdam’s Science Park. But, says Andrew Fray, managing director of Interxion UK, buyouts are not the company’s preferred means of growth. “We are building right cross our Western Europe footprint,” he explains. “We see huge opportunities for organic growth, and in fact we can’t build fast enough at the moment to meet demand.” Fray sees various dynamics affecting the market, not least the rise and rise of the hyperscale cloud sector: “Across Europe we’re following the trend towards what I’d call mega sites to meet hyperscale needs,” he adds. “We don’t have a global footprint, it’s true, but hyperscalers are on the lookout for players who know their local market, and how to acquire things like power and connectivity in that local market. Their expectation is quality that matches a global standard, which we offer.” He says the company is building to meet the needs of digital transformation in its widest sense. “We’re seeing the movement of resources into the cloud,” he points out. “Workloads are generally going to a variety of clouds. We’re also seeing the rise of the ‘connected community’, which is a big thing for us in capacitymedia.com
London where we have a collection of financial services players, mostly capital markets trading companies as well as a halo effect of related fintech companies. Banks are looking for ways to orchestrate the different apps they are running in areas from blockchain to DDoS mitigation to invoicing. They want to connect not only their resources, but to connect those to other participants in their world. We’re providing a similar function in communities such as media.”
Data capabilities Digital transformation is without doubt one of the data centre market’s biggest boosters, agrees Archana Kesavan, senior product marketing manager with network
monitoring player ThousandEyes: “There can no longer be any doubt that digital transformation is one of the most crucial concerns of modern businesses,” she claims. “It is estimated that initiatives within this space will reach an investment of $2.2 trillion globally this year. Meanwhile, the majority of business leaders also realise the importance of such a drastic change, with 66% wanting to transform their businesses.” The widespread adoption of automation, artificial intelligence and machine learning is also having a significant knock-on effect on services. “Traditionally, data centre providers primarily worked toward a centralised cloud model where the many processes
The most significant M&A deals across the data centre sector in the past two years In May 2017, Equinix announced the finalisation of its $3.6 billion acquisition of a number of data centres owned by carrier Verizon. The 29 facilities that were part of the deal were spread over 15 metro areas in North America and South America. The deal was at the time the largest example of the trend for carriers to offload data centre assets in a bid to reduce operational costs and raise capital while refocussing around core activities. It followed CenturyLink, Tata Communications, AT&T and Windstream in this respect.
locations. Meanwhile, also in early 2019, private investment firm GI Partners continued a spate of technology infrastructure investments with the purchase of two data centres from NTT Data, in Plano, Texas and Quincy, Washington. Stack Infrastructure was launched a a new name on the market by IPI Data Center Partners and Infomart Data Centers, resulting from the merger of IPI’s T5 data centers, along with the remaining properties of Infomart, following the sale of its Dallas carrier hotel to Equinix.
September 2017 saw the completion of the merger of data centre giant Digital Realty and rival DuPont Fabros Technology. The $7.8 billion all-stock deal created an entity with a portfolio of 157 data facilities.
In March 2019, AT&T finalised the sale of 31 of its colocation data centre facilities to Brookfield Infrastructure. The deal saw AT&T receive US$1.1 billion from Brookfield which has now organised the assets under the Evoque Data Center Solutions brand. AT&T will offer its business customers Evoque’s colocation services.
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In July 2018, data centre operator Global Switch sold a 25% stake in its business to a consortium of Asian investors for $2.8 billion. This was the largest deal of its kind last year. In December, Digital Realty completed the acquisition of Ascenty, the Brazilian data centre provider, from private equity firm Great Hill Partners in a transaction valued at approximately $1.8 billion. Edge services provider EdgeConneX expanded its stake in the European data centre market in January 2019 by purchasing Vodafone’s facility in Munich. The purchase followed the acquisition of a facility in Warsaw in Poland. The same month saw Boston-based investment firm Berkshire Partners move for a majority stake in Teraco Data Environments, subject to approval. Teraco, based in Johannesburg, is Africa’s largest data centre operator, with more than 30MW of power load over five
April 2019 was the month when Equinix closed the purchase of Switch Datacenter’s AMS1 data centre business in Amsterdam for $34 million. The facility will be renamed Equinix AM11 International Business Exchange (IBX) data centre and is located close to Equinix’s existing campus in southeast Amsterdam. In May, Dutch telco KPN agreed to sell its data centre subsidiary NLDC to a fund managed by DWS, a global infrastructure investment manager, for an undisclosed amount. In the same month, Node4, the UK-based hybrid cloud, data centre and communications managed services provider, acquired virtual private cloud provider Secura. And hyperconverged storage specialist Cohesity acquired data management player Imanis Data.
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such as storage, computing and analytics took place in a centralised data centre that is different from the actual location of data generation,” observes Falk Weinreich, SVP sales and marketing, Colt DCS. “As businesses increasingly adopt a machine-led industrial journey, this model has swiftly become outdated.”
We’re seeing a trend towards self-remediation where data centres are almost expected to repair themselves” Michael Wood, chief marketing officer, Apstra
Handling new volumes The consequence is an increased demand for low-latency data services, he says, with the data centre industry increasingly embracing edge computing: “Moving data and applications to the edges of a network, narrows the distance between users and data, resulting in improved speed, reliability and efficiency,” he concludes. “This allows data centres to generate, process and analyse large volumes of data in a fast, stable and consistent manner, while businesses are able to maintain operational runtime effectively.” Networking solutions vendor Apstra, which is trying to disrupt the WAN market as a pioneer in intent-based networking, is now moving in on the data
centre sector with a similar plan. “Data centres seem to go through a transformation every few years, and the transformation that we’re currently seeing is what for want of a better term I’ll call intent-based data centres,” explains Michael Wood, Apstra’s chief marketing officer. “This is reflected in higher distribution. There are more data centres where enterprises do compute, storage and applications. We’re also seeing a trend towards self-remediation where data centres are expected to repair themselves. As an enterprise you also want your data centre to have some of the attributes of what the hyperscale players are doing, relative to cloudification. You want to turn up services as you can AWS or Azure. You want control regardless of where the application or user resides. Automation is key too.” Small wonder that Synergy Research Group expects further seismic change to hit the data centres market, and for the acquisition trend to continue for at least the next five years as data centre operators look to scale up to meet the market’s fast changing needs.
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SPONSORED Q&A: ALAN GARCHITORENA
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Q&A WITH ALAN GARCHITORENA Q. First, what is CWR? And you can look at the network performance, in terms of the CWR is short for speed levels and resource use, right down to each cell site. You can collaboration, workspace, set different key performance indicators (KPIs) and key quality and realisation. CWR is a indicators (KQIs), in terms of video download speed and capacity solution that enables digital utilization, for services such as Instagram and Twitter. transformation of mobile Say an operator wanted to focus on high-value services using network operations. It helps YouTube. It’s possible with CWR to identify cellsites that have carriers digitize the network issues that impact on high-value services. The operator can ensure planning and optimization as that cells are performing well and mitigate in advance congestion well as the service experience issues. operation based on carriers’ processes, driving digital Q. Does this impact on 5G plans? transformation of network Yes, we can use CWR to project where you will have high demand operations. It offers a unified Capacity for 5G, and prioritise the area from the knowledge CWR gives us digital workspace that uses data about existing 4G demand. from the marketing and network side. This information is based on real network usage. CWR is an innovation to achieve agile operation, value-based We can look at the existing network and see what is forecast network construction, efficient optimisation, excellent customer over the next six months. We can recalibrate the throughput. experience, and marketing support through collaborative What will be the average throughput the network will have? operation of internal departments. Instead of, say, 3Mbps you can ensure you have 7Mbps as the For example, it can quickly identify high-value areas and user average where it’s needed. experience problems. Resolve and close network problems based When it comes to 5G, 95% of the networks will be based on on the priority criteria pre-defined together with the operator, existing 4G networks. CWR allows you to take a snapshot for thus the sequence of optimization, capacity expansion, and site traffic forecasting – and it will tell you what kind of 4G traffic deployment takes this into account. This helps ensure the user you have and that will enable you to forecast demand in the 5G experience is optimum, especially where it matters most. And era. it can also support the marketing organization for contextual marketing. Q. How does CWR help plan new services? CWR is a solution from Huawei – a marketing view of the You can create a plan and forecast how the network will be network, compared and combined with the network view. impacted – where is the expected demand? You can look at the past six to 12 months and see what kind of traffic you already Q. What’s the difference between these two views? have. The marketing view is based on business support systems (BSS), And it will help you identify the issues in the network you while the network view is based on operations support systems might have already, so you know what to focus on. (OSS). Typically these are different departments that may have targets Q. What are the business benefits? that are not fully in-sync. There are gaps and there is a challenge CWR helps you make precise investments – it helps you know when they launch new services and, for example, the capacity is exactly when you need additional capacity and where you need it. not enough or the network is not ready. The problem is you can’t And it helps you speed up your go-to-market plan, with new see the overall situation between the different departments. services, new package offerings to the end users. You can make Q. And what are the practical uses? sure these are executed very quickly. We do and can automate a lot of things in the network. For You can reduce, and prioritise expenditure; you can focus your example an operator might use CWR to migrate services from optimisation based on known requirements. And you can reduce 2G/3G to 4G. Or another operator might use it to offer different or totally eliminate accessibility issues and dropped calls by packages to customers. In particular they can look at how they expanding capacity based on real thresholds, using information can increase the number of high-value subscribers. about the actual usage of sites. We’ve been developing CWR in Huawei for two or three years Q. What insights can the operator get via CWR? and now the service is mature, and many operators have already The operator can look at what services or applications are most started to use it. More than 50 operators had deployed the popular – such as YouTube, Instagram, Facebook etc. solution and/or running proofs of concept (PoC). capacitymedia.com
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BUILDING FOR THE GLOBAL HYPERSCALE ERA DEMAND FOR HYPERSCALE DATA CENTRE CAPACITY HAS NEVER BEEN GREATER. WE EXAMINE THE DRIVERS BEHIND THE DEMAND, AND LOOK AT HOW COLT DATA CENTRE SERVICES HAS BEEN INVESTING TO MEET THE MARKET’S NEED. the world who are dominating the market in the US and China. Spang notes that the creation of the right kind of data centres is critical to enable hyperscalers to address numerous areas of demand: “You have classic cloud applications like data storage,” he says. “Plus most of the information that we need to access on a daily basis in the cloud, such as airline and train times, or simply to use Facebook. Now you have newer applications coming in, like AI and IoT, which will drive the demand for cloud on further. Consider how people are talking about gaming being available from the cloud, and not from an Xbox or PlayStation any longer, or the fact that Netflix and Amazon Capacity Prime are all available from the cloud. We’re seeing more and more in the cloud, and less and less on private devices.” Spang says it’s the job of data centre owners and operators like Colt DCS to provide services to hyperscale companies so that they can cater to this wide and growing list of technologies and cloud-based services: “These new technologies are where the dramatic growth market is, and it is that growth spurt that we are aiming to participate in,” he adds. “We have already been very successful in places like London, Paris, Frankfurt and Tokyo. Phase two is not only develop existing campuses, but acquiring new land to build new hyperscale data centres.” Over the past year, Asia has featured significantly in the company’s plans. In a recent announcement, Colt DCS said it has acquired a site in Osaka in Japan. The Osaka site will house the company’s first hyperscale data centre in the region in the form of a 30MW facility, building of which is expected to commence later this year. Osaka, points out Spang, has a huge population. It is Japan’s second largest economic market and the 12th largest metro market in the world. Demand from online content providers, managed service and cloud service providers is expected to grow The rise of the market for cloud-based services is driving the need significantly there over the next five years, he adds. The Osaka for high quality data centre capacity to match. A new generation data centre will be Colt DCS’ third hyperscale data centre in of large data centres is emerging designed specifically to answer Japan, adding to the existing Inzai campus just east of Tokyo, this need, in particular to meet the urgent requirements of the which already houses two other hyperscale facilities. The Osaka world’s major cloud platforms. data centre will also provide customers access to highly-skilled, “Hyperscale data centre demand is undoubtedly being fuelled bi-lingual in-house staff to manage its facilities and support by cloud take-up,” believes Detlef Spang, CEO with Colt Data customers, a key solution that sets Colt DCS apart from other Centre Services (DCS). “We’re talking about public cloud, providers in the region. private cloud or hybrid cloud services. Enterprises and consumers “Asia is very important for us,” explains Spang. “Growth everywhere are more and more interested in consuming predictions there are in the 30% per annum range. We already applications and services in that way. Everyone has a smartphone have a strong foundation in Japan, so it was a natural move to set and wants to use it to access content in the cloud, and more and up in Osaka, the country’s second largest city. With a population more enterprise workloads depend on it. The world needs data of 18 million, it is not a small city. We want to offer services centres that can support this trend.” there to our client base. We’re also working on a new building The cloud phenomenon is clearly global, says Spang, noting on our Tokyo campus too, which will give us an added 27MW that there are perhaps 15 or so hyperscale cloud providers around there.”
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Colt DCS has also made its ambitions clear in another of Asia’s investing to improve its existing footprint in Europe, including growth markets, that of India. Last year saw the appointment of its flagship London North data centre facility, in Welwyn Garden Sujeet Deshpande as Country Head in India, just months after City, which has now been recertified with a Management and the company first announced its interest in the country. It is Operations accreditation stamp of approval. investing in a hyperscale data centre campus in Mumbai, in the The M&O stamp validates the critical facilities management form of a 100MW facility, set to be the largest development of and operations practices of a fully functioning data centre. It its kind not only in India but all of South Asia and Asia Pacific, is a stand-alone assessment that covers: day-to-day operating excluding China. activities including an audit of daily operations and an assessment The strategic decision to expand into India, says Spang, has of staffing levels and competencies, upstream planning and been driven by the substantial customer demand it has received decision-making and full life cycle asset management. for best-in-class data centre space, as the consumption of cloud Colt DCS says it exhibited high standards of management services continues to thrive in the country. Demand for cloud and operations at the London North hyperscale facility with services in India alone is predicted to be growing at 24 per cent staff and management working collaboratively across functions CAGR between 2015 and 2020, he says. with incumbent maintenance partners. Colt DCS was initially “India is another place with a large population and a very high awarded the highest global score for the M&O accreditation uptake of technology,” he adds. “It’s a big market with not many in 2012. Since then, Colt DCS has retained a high score – a data centres serving it, certainly not of high quality, so we saw a testament to the high standards it is operating at its hyperscale big opportunity for ourselves. That’s why we’ve gone to Mumbai facility. London North data centre is Colt DCS’ flagship data with such ambitious plans.” centre here in the UK. In September 2018, it was announced Spang says that it’s important for Colt DCS to build the best that six new data halls were to be built at the data centre as part quality facilities that it can, regardless of location: “Quality is of the first phase of a major expansion project at the site which key for us,” he explains. “In the cloud world, users don’t want will comprise in total 10 new data halls. to experience a disadvantage compared with what they were In addition, a major power upgrade is underway that will see formerly getting on their PC. Cloud providers know that if a the site almost double its utility power, by adding an additional service is worse, people will not want to use it. To provide a 30MW. The delivery of the first two halls is expected in the reliable, always available service they know they need a data coming months and remainder being delivered in Q2 2019. On centre provider to match. Besides availability and resilience, completion, the project will bring the total IT power supply to helping our customers with speed to market is very important. Capacity more than 40MW. If you are launching into the cloud market, it has to happen fast. The company is also adding an additional 6.9 MW of capacity We’re committed to helping our customers make a difference in to its flagship data centre in Paris. The expansion is in direct their market.” response to demand from existing customers. Construction has Spang says that an important part of delivering on the needs of already commenced and is due to be delivered later in 2019. the cloud market is to create facilities that are designed expressly Once delivered, it will bring the total capacity built within a 24 for that market, and not to adapt a facility designed for a premonth period at this data centre to 9.4MW. In addition to this cloud use: “A hyperscale facility has to be designed for the cloud capacity, further expansion capacity is planned within the next era, not adapted for it,” he explains. “The technical requirements 18 months that will see a further 12MW of capacity added to for the cloud market are different. There’s more data, and it’s the site, bringing the total data centre capacity to 23.9MW IT moving faster than in other data centre sectors.” power. Due to the successful take up (9.4MW) and planned That doesn’t mean that Colt DCS is not spending large sums to investment in further capacity, Colt DCS’ market share will take its existing cloud-ready data centre facilities and make them vastly increase, targeting a position in the top five providers in even more suited to hyperscale needs. It has, for example, been the market.
The Inzai 2 facility
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68 | SPONSORED STATEMENT
GETTING READY FOR THE DIGITAL AGE The 4th Industrial Revolution is here to make the boundaries between the natural, biological and digital world inconspicuous but promising at the same time to improve the quality of life around the world. For businesses, current networking infrastructure presents the opportunity for global presence at low operating costs. Cloud providers such as Amazon, Apple, Facebook, Google and Microsoft are responsible for almost three quarters of the total international traffic growth worldwide. The international telecommunications industry is once again at the center of developments with the emergence of new technologies such as Cloud as a service, Internet of Things, Artificial Intelligence, Machine to Machine communication, 5G deployment, etc. To succeed however in this new global environment telecom operators need to change their culture and their traditional way of functioning and move forward to support the digital transformation.
OTEGLOBE offers connectivity to the major cloud providers through its presence in the major datacenters in Europe, namely InterXion and Equinix and enables dedicated connectivity to Google Cloud Platform (GCP) via Google Cloud’s Partner Interconnect (GCI Partner) program. At the same time, George Nikoloudis, COO OTEGLOBE has partnered with 18 international telecommunications providers to build and operate the Asia Africa Europe -1 (AAE-1) submarine system that connects major OTEGLOBE: Building on innovation, cost Data Centers in 3 continents: Asia (incl. Middle East), Africa Capacity optimization and new partnerships and Europe. This state-of-the-art cable, with a total length of OTEGLOBE as the leading provider of international wholesale 25,000 km and a capacity of more than 40 Terabit, arrives in voice and data services in Southeastern Europe has already devised Greece at OTEGLOBE’s International Cable Landing Station its plan to address the ever-increasing challenges of the digital age. (CLS) at Chania, making it its first point of entry in Europe. During the last 3 years the company has expanded and With the arrival of AAE-1 in Greece and its interconnection with redesigned its international backbone network, extending from OTEGLOBE’s unique and fully upgraded backbone network, Greece to Western Europe, by leasing new fiber-optic routes an important part of the high-speed telecommunication traffic across Europe reaching a total length of more than 21,000 stemming from growing markets of the East, such as China kilometers. It is one of the first and widest Pan-European multiand India is now passing through Greece to reach anywhere in terabit transport networks designed with ITU-T Flexible Grid Europe. OTEGLOBE can provide reliable interconnection from Channel Plan, which is optimized for long-haul transport in Athens though the AAE-1 cable to Singapore with roundtrip terms of capacity and reach. latency of around 120 milliseconds, thus offering the best latency route from Europe to Singapore. Moreover as the leading Greek landing partner, OTEGLOBE can provide landing station facilities with a fast, diverse and financially attractive extension to Europe to new private or consortium subsea cables, emerging as an alternative and resilient hub in the Mediterranean basin. As part of its voice business, OTEGLOBE operates a carrier class 4 Voice network that carries more than 6 billion minutes running over IP. Till now it has migrated the majority of its traffic over IP interconnections fully adhering to IPX requirements. As part of its digital transformation plan the company already started the implementation of the next major transition in its voice network platform which involves the migration of key Voice Network Elements to NFV. The company’s strategy is to move gradually more network elements to NFV in the near future to benefit from the cost elasticity, flexibility and redundancy that such a solution provides. 14 TAT-
Moscow
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Munich
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OTEGLOBE International Submarine & Terrestrial Networks
GREECE
F.Y.R.O.M.
1. Kastanies 2. Alexandroupolis 3. Promachonas 4. Kilkis 5. Florina 6. Kristalopigi 7. Melissopetra
10. Bitola 11. Gevgelija
INT’L CLS
CAPITAL CITY
ALBANIA
OTEGLOBE EUROPEAN NETWORK Capacity from Local Partners SERVICE PoP DUAL PoP
OTEGLOBE participation in Submarine Cables AAE-1 SeaMeWe-3 Silphium (Landing Partner) TAT-14
CITY
8. Koritsa 9. Tre Urat
BULGARIA
12. Petrich 13. Svilengrad TURKEY 14. Edime 15. Kesan
LANDING POINT
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70 |
Global hot prospects CAPACITY ROUNDS UP 10 INNOVATIVE GLOBAL DATA CENTRES
NJFX – Colocation facility
Equinix - LD7
Location: Wall Township, New Jersey Facts: NJFX owns and operates a 64,800 square foot purpose-built Tier 3 cable landing station (CLS) colocation facility and 58-acre campus. It is the only CLS colocation campus in the US supported by several routeindependent carriers that offer direct access to multiple independent subsea cable systems interconnecting North America, Europe, South America and the Caribbean. The facility offers direct access to TGN1, TGN2, Seaborn and HAVFRUE/AEC2 (2019) and Wall-LI (2020) subsea cable systems.
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Location: Slough, UK Facts: The £90 million highperformance data centre is a new flagship site within Equinix’s Slough campus. With over 90 network service providers and access to a range of transatlantic cables, the London Slough campus is one of the busiest network nodes in the UK, and offers latency in the region of 30ms to New York and 4ms to Frankfurt. LD7 has been designed to maximise energy-efficiency through various green initiatives, including a Chilled Water System in combination with an Adiabatic heat rejection system.
Interxion MSR1 and MRS2 Location: Marseille, France Facts: The Marseille facility has 14 subsea cable systems from these regions, which terminate in Interxion Marseille data centres. The Marseille campus comprises of two datacentres, with a third under construction. The facilities are located close to the beaches where multiple intercontinental subsea cables land. “Marseille has become one of the fastest growing interconnection hubs in Europe,” says Mike Hollands, director of market development & strategy, Interxion. “Customers in Marseille are able to access over four billion potential users in these markets via fourteen subsea cables that connect directly to our campus.”
ServerFarm - TiTAN
MainOne - MDXi Location: Lagos, Nigeria Facts: MainOne’s Data Centre subsidiary, MDXI, is located in Africa’s biggest economic hub and is Tier III certified. MDXI is the leading data centre in West Africa with the top five certifications in the industry. It is designed to international TIA 942 standards and is designed to address the growing demand for colocation, cloud and disaster recovery services in the region.
Location: Moses Lake, Washington Facts: A former missile control centre built to TEMPEST military specifications, TiTAN is a bomb-proof site engineered to withstand a 10-megaton blast within a quarter mile. The site also has a low seismic rating (2B) and low risk of natural disaster, making it an ideal disaster recovery location. TiTAN provides retail colocation services with the highest percentage of hydroelectric power in the US. In addition to the climate benefits of hydro power, it’s also one of the most cost-effective power generation options. june/july 2019
map: data centers | 71
Green Mountain - DC2-Telemark Location: Rjukan, Norway Facts: DC2-Telemark is located in a historic region of Norway and is being built on a ‘brownfield’ site with a 2x10MW supply initially available. Due to its close proximity to cradle of hydro-electric power in Norway, the site has several large hydro-power stations nearby ensuring robust and low-cost power to the site. As a result the facility is run on 100% renewable energy. In addition, DC2-Telemark utilises the cool natural Norwegian air to cool our data centre at Rjukan.
Colt DCS – TBC Location: Mumbai, India Facts: Colt Data Centre Services has acquired land in Mumbai with plans to build a 100MW IT hyperscale data centre facility in the area. The 100MW facility will be part of a campus, which will allow the Colt DCS to build out further data centres from the same location. To support a rapid build out of the site, Colt DCS has already secured a substantial super high-voltage power supply of 150MVA utility feed to the site. Colt DCS will be the first mainstream western data centre operator to enter the Indian market.
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SUNeVISION - MEGA-i Location: Hong Kong Special Administrative District Facts: One of the largest Tier III+ internet service centre buildings in the world. The 30-story, 350,000 gross square feet data center is equipped with a resilient global network, which can be tailor-made to suit customers’ different power and deployment specifications. With 230 service providers, SUNeVision (iAdvantage)’s MEGA-i is ranked first in the Hong Kong market amongst the 110 colocation data centres that operate in the region.
Global Switch Singapore Tai Seng Location: Financial district, Singapore Facts: The 26,743-sqm facility is home to a number of leading internet and cloud services companies including ISPs, the major content owners and distributors, web portals and online social media. Together with the presence of the Singapore Internet Exchange (SGIX), these organisations make the facility a convergent connectivity hub that reaches out to all parts of the globe. The site has been designed with multiple layers of redundancy and deploys a best-in-class Critical Environments Programme.
Digital Realty Digital Erskine Park 2 Location: Sydney, Australia
Facts: Digital Erskine Park 2 is a new facility located adjacent to Digital Realty’s existing facility in Erskine Park. It is a 19MW facility to be built in phase with 9MW ready in Q4, 2018. Digital Erskine Park 2 has the ability to reach out to PIPE-IX, the 2nd largest IX in Australia in Digital Erskine Park 1. In addition, the site boasts 16.8MW total facility IT capacity, and diverse connectivity to SYD10 for carriers services. capacitymedia.com
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executive interview: josh snowhorn | 73
AT THE EDGE OF A NEW WORLD FOR DATA CENTRES Data centres for the 5G era will be small and installed at the edge of networks so they can deliver content efficiently. Josh Snowhorn, founder of EdgeMicro, tells Alan Burkitt-Gray
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e’re about to see what Josh Snowhorn calls “a complete land-grab” for small data centres at the edge of the world’s new 5G networks. He should know: he’s been in the data centre industry since 2000, when he was vice president of Terremark Worldwide. Shortly after Verizon bought Terremark for $1.4 billion in 2011, Snowhorn moved on to CyrusOne, a data centre company then owned by Cincinnati Bell. Last year it was time to found his own company, EdgeMicro – as the name implies, focusing on the edge. “My history is in giant data centres,” he tells me. “The edge is different: the big thing is content. The content guys are looking at those markets where there are no internet exchanges – places such as Houston and Dallas, no peering or interconnection.” Is this right, that there are no peering points or internet exchanges (IXs) in so many places? “IXs are not as pervasive as in Europe,” he says. “Houston is sprawled, with millions of people, and no IX.” At the moment, this is tolerable. If you’re watching Netflix or Facebook Live, then it doesn’t matter too much where the file comes from. But with 5G, that will be different. The demand for content will rise and content companies will look for a better way to reach their customers. “5G will need more bandwidth, more backhaul and more cost.” There’s a technological reason, too, says Snowhorn, who is taking part in our first Communications Infrastructure Summit, in Atlanta on 26 June. The ideal is to deliver content right to the edge of the mobile network – to as close to the base station as you can. In the mobile world until now this has been done in repurposed central offices capacitymedia.com
– telephone exchanges – where peering equipment has been installed in place of the old equipment designed to connect landline calls. “Previously content companies embedded their services in the central office,” he says. “A central office wasn’t designed for that.” And there’s what might be called a territorial problem. These aren’t Snowhorn’s words, but what he’s meaning is that one local exchange company runs theCapacity central offices in a city – but the content companies want access to all the mobile companies serving the area. That local exchange company is the gatekeeper and is not always cooperative. What’s the alternative? Go direct to the base stations, and put small data centres next to them, connected to the content companies by fibre. “But 3G and 4G doesn’t allow peering at the edge,” he says. “Can’t you just peer? According to our CTO, Anton Kapella, no.” With 5G, though, it’s different. “When 5G comes, we can do it,” says Snowhorn. EdgeMicro has filed a patent covering what it calls METX, mobile edge traffic exchange. EdgeMicro commissioned Aricent, a global design and engineering company owned since 2018 by French group Altran, to develop METX. “None of us are really software guys, so we asked them to write a module, and we now have the solution,” says Snowhorn. “We paid them to do it, and we own it.” EdgeMicro’s small data centres are “half a rack up to two racks” of equipment. Ultimately there will be one at “every radio head-end server gateway”. So far, EdgeMicro has planned a roll-out to 30 cities – “but we have to do hundreds of cities”, he says. “The big cloud guys are the biggest customers, and also Akamai. We have a US focus now, and then Canada.” Snowhorn is sharing information with Cara Mascini, CEO of EdgeInfra, based
5G will need more bandwidth, more backhaul and more cost” Josh Snowhorn, founder, EdgeMicro
in Amsterdam (see interview, page 59). “It’s helpful for everyone and there’s an agreement that allows us to integrate if we want to in the future.” In the longer term he sees standarddesign data centres being moved around the world on ships – in shipping containers themselves or something of similar design – ready to be dropped off in ports and installed in Africa, Latin America, south-east Asia and India. But he’s aware that competition will build. “Every Tom, Dick and Harry will do an edge strategy. I see a complete land-grab. You have to do it at scale.” There is a plan to raise “more than $100 million” later in the year, “but that’s a moving target”. Small data centres with 5G will appeal to applications “such as video, gaming and telemetry”, he adds. “Who knows what smart people will design?” Taxi companies such as Uber and Lyft “are excited about local access” to services, he says. “It will reduce their cost of deployment.” When Snowhorn helped to found EdgeMicro, he was chief strategy officer, but he stepped back from that at the beginning of the year. “I’m not full time any more. You can hire a bunch of people for what you’d pay me.” That gives him a bit more time to indulge his interest in Formula 1 racing. “I try to do five to 10 a year.” He reels off a list of those on his schedule. “But some are more boring.” In the edge infrastructure world he’s hoping things are anything but boring.
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76 | SPONSORED STATEMENT
DEUTSCHE TELEKOM GLOBAL CARRIER: REACHING FURTHER INTO THE CLOUDS WITH INNOVATIVE CLOUD CONNECTIVITY SOLUTIONS The demand for cloud access is steadily growing, in large are amazed with the partnerships we’ve established with big name part due to rising digitisation, a booming IoT landscape and CSPs. All in all, a win-win situation.” expanding mobility services. To meet that need, Deutsche In the near future, Deutsche Telekom Global Carrier expects to Telekom Global Carrier has been busy expanding its Secure expand the service via other forms of connectivity, such as Layer Cloud Connect service, which was launched last year. Now it 3 IP VPN. makes it even easier for customers to receive simple, secure and A public option superior access to cloud service providers (CSPs). In addition to Secure Cloud Connect, Deutsche Telekom Global According to figures from Cisco, zettabyte-level growth in data Carrier also offers its Public Cloud Connect service. This is a volumes is expected in the coming years, resulting in global IP traffic swelling from 6.8ZB in 2016 to 20.6ZB in 2021. Research safe solution for the growing number of customers wanting to connect to the public cloud. company IDC predicts that global spending on public cloud The Public Cloud Connect service links to the chosen cloud and infrastructure services will increase by 24 per cent in 2019, provider via Deutsche Telekom’s IP Transit network, which runs to US$210 billion. Much of this expansion will be propelled by over its highly protected AS3320. As a global network provider, hyperscale cloud providers, and companies and users wanting to the company offers continuous, on-demand and direct access gain access to them. Capacity to multiple public clouds. And because it is able to handle Deutsche Telekom Global Carrier’s Secure Cloud Connect, extremely large volumes of capacity, traffic congestion is never a aimed at wholesale and enterprise customers, offers a secure, high-level, cloud-connect service for mission-critical applications. threat. It does so by providing a fully private connection that does A cloud solution for every need not use the public internet. Delivered via a dedicated Layer In addition to ease of implementation and cost-effectiveness, 2 Ethernet connection, a maximum level of security and the high level of security afforded by Deutsche Telekom Global availability is thus ensured. Carrier’s cloud services ensures compliance with legal regulations. With Secure Cloud Connect, it’s possible for a client to reach That includes the new European Union General Data Protection around 40 different cloud service providers across Europe and Regulation (GDPR), whereby enterprises must ensure their the US. This is accomplished through direct relationships with cloud services are secure and protected for customers. specific CSPs or via cloud exchange. The service can be quickly With a wide range of options, Deutsche Telekom Global established and saves customers time and money by avoiding Carrier provides secure, high-performing and low-latency complex contractual agreements with individual providers that solutions that deliver exactly what customers need to connect to additionally ask for large initial outlays. major CSPs. All they need to do is decide whether they require Direct connections private, public or hybrid cloud solutions – and then smile and To boost the speed and ease of implementation and reduce costs, enjoy the benefits. Deutsche Telekom Global Carrier has initiated partnerships that enable direct connections to specific CSPs. Those include the Open Telekom Cloud offering of T-Systems, Amazon Web Services and the recently added Google Cloud. These moves give customers access to renowned cloud players with significant brand strength. Conversely, Deutsche Telekom Global Carrier is attractive to CSPs because it facilitates access to the rapidly growing Eastern European markets, where it has a strong presence. “Secure Cloud Connect is quite innovative,” says Jasmina Cehajic, head of product management for Access & Transport Services at Deutsche Telekom Global Carrier. “We have seen a very positive response over the past year. Customers are extremely pleased with the ease of set-up and the cost savings, as well as our ability to enable their CLOUD CONNECTIVITY PROVIDED BY DEUTSCHE TELEKOM GLOBAL CARRIER multi-cloud strategy. And many
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june/july 2019
executive interview: divya ghai wakankar | 77
BICS MOVES FULL SPEED AHEAD WITH CLOUD COMMS As the proliferation of the cloud continues to rise, Divya Ghai Wakankar, head of cloud communications at BICS, speaks to Capacity about the market at large and why she’s such a big promoter of women in STEM
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o stranger to the roaming and mobile side of our industry, BICS is quickly establishing a foothold in the cloud communications space. As a full scale communications enabler the company offers such services as Numbersas-a-Service, APIs and SIP trunking, to name a few. Leading these developments is Divya Ghai Wakankar, head of cloud communications product management at BICS. Speaking to Wakankar on the latest range of cloud offerings from BICS she says that the company’s cloud products are very much geared towards digital service providers. “We are targeting the digital service providers that are offering an UCaaS (Unified Communications as-a-service) or CaaS (Communications as-a-Service) solution to the market. In this area, I am leading the BICS portfolio, which we call cloud communications,” she explains. With over 20 years of experience in the wireless and telecommunications sector, Wakankar has a wealth of knowledge on the cloud market and its developments. Speaking to her about the evolution of hybrid cloud, she says that we are just getting started. “I think we have just initiated hybrid cloud,” she says. “Every organisation or enterprise is going through their digitalisation process and therefore going through their cloud journey now.” According to Wakankar CTOs all over are reviewing their processes and digitising their components all while bringing down their total cost of ownership and being mindful of capital expenditure. As a result, hybrid cloud is most effective way to do this while continuing on a path to having “one single approach across the entire organisation”. Similarly, multi-cloud convergence is reaching a tipping point and the cloud is a major catalyst to how enterprises will do business in an evolving digital economy. capacitymedia.com
But what factors determine what the right cloud is? Wakankar says this depends on your use case because not all clouds are created equal. “I would say that there are 2 or 3 players that will be at the top if not more so because Alibaba is leading the way in certain parts of the world now,” she explains. “Ultimately if they offer the same kind of services, if they are on par with each other, then it be the CTOs Capacity strategy to use whichever one they’d like to go for if they have all the components they are looking for. But I think it will take time to converge all services into one cloud seeing as not all the offerings at the same level.” Working so closely with enterprises Wakankar knows first-hand what the demands are of this unique stakeholder, which she says is simply the right connectivity to the right cloud. “They are looking for connectivity to the likes of Microsoft, AWS and Google,
I’m sure there will be a lot of synergies between 5G and cloud” Divya Ghai Wakankar, head of cloud communications, BICS
as well as global connectivity for their Unified Communications services, which is replacing their old infrastructure for their new infrastructure from the cloud.” Interestingly, Wakankar also sees a great number of synergies between the cloud and other emerging technologies like 5G, IoT and AI. “You are definitely going to see a lot of collaboration in the future where IoT services and the cloud services will interact with each other,” she says. “There will be a type of solution package that we
will come up with on the market because when you look at IoT-based requirements you have the need to consider cloud-based communications capabilities.” As for AI and 5G, she adds that most cloud-based platforms are being built using AI even for things like call routing, voice recognition, while 5G is all about the data, and although the use cases are still being developed, “I’m sure there will be a lot of synergies between 5G and cloud,” she says. Within BICS’ own family, Divya is a big promoter of women in STEM, speaking to her about gender parity and encouraging more young women to enter the field, I can hear she has a lot of passion for this subject. “We don’t see enough female leaders in the industry today,” she says. “When I go to conferences to speak, I don’t see a lot of women speakers but I think it is changing a bit now.” In her view, this changes when we start engaging with the next-generation of young women and encouraging them to get involved with STEM. “I also think it happens with a bottom up approach. We have to promote the management within every company; the CEO has to promote it,” she explains. “Explore what the gender balance is within the management team and make conscious decisions to bring in more female managers and senior leadership.” The strategy, from Wakankar’s perspective, is focussed on two areas. The development of the BICS API journey, “We have transformed BICS to work in an agile manner, so that API is a key focus point for us,” she says. As well as its SIP trunking capabilities. “We are enhancing our coverage in different regions to make sure that we are built to cater to our enterprise customers as they move ahead in their selection of a Unified Communications platform and the cloud.
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AWS and the culture of the cloud Jean-Philippe Poirault, global head of telecoms at AWS, speaks to Natalie Bannerman about the biggest trends, the culture shift required of cloud computing Capacity and the three pillars that separate AWS from the crowd
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mazon Web Services (AWS) remains the market leader in the public cloud market, retaining close to a 32-35% share. But how has AWS managed to remain the leader in the cloud space and what exactly does AWS do that its competitors don’t? Speaking to Jean-Philippe Poirault, global head of telecoms at AWS, he says there are three pillars that set AWS apart from its peers.
Three pillars First, he says, they are unusually customerfocused. “A lot of companies say this. Very few walk that walk,” he explains. “Most of the big technology companies are competitorfocused, they look at what the competitors are doing and try to one-up them.” Second he says is that they are pioneers. “Most large technology companies have lost their will and DNA to invent. They acquire most of their innovation. It’s a strategy that can work, it’s just not ours.” Poirault says that AWS likes to hire
builders, who look at customer experiences that are flawed and then figure out how to reinvent those. “In a space that’s moving as fast as the cloud is, to be partnered with the company that has the most functionality, that’s iterating the quickest, has the largest community, had the vision for cloud from the start without having to patch together acquisitions, that’s very attractive.” The last pillar is that AWS is unusually long-term oriented. “You won’t see our folks show up at customers’ doors a day before the end of the quarter or the day before the end of the year and try to harass them into a sale, not to be seen again for a year,” he explains.” We’re trying to build relationships and a business that lasts longer than all of us in this room.” With a career spanning over 20 years in the wider telecoms and tech sector, Poirault has cemented his position as a thought leader in the cloud market and is therefore well versed on the latest trends and innovations. Hybrid cloud is one, as it increasingly becomes the norm, as businesses transition
between legacy networks to more cloud-based connectivity. But an argument could be made that its potential is only just being realised. Poirault however, thinks to the contrary, believing that all operations will eventually happen entirely in the cloud. “While we believe in the fullness of time, the vast majority of companies will run almost all of their IT workloads in the cloud,” he explains. “We see our role in hybrid as working with and for our customers to develop integrations between their existing infrastructure and AWS, so our customers can easily use AWS as a seamless extension to their existing infrastructure investments.” The sister piece to that discussion is the adoption of multi-cloud convergence and it seemingly hitting a tipping point. If the cloud is a major catalyst to how enterprises will do business in an evolving digital economy, what exactly determines what the right cloud is? According to Poirault, most enterprises start-off thinking that they will split their workloads in the cloud evenly between june/july 2019
the big interview: jean-philippe poirault | 79
2004 - 2011
Chairman of the board of directors, MNC, Mobile News Channel
2007 - 2011
President of multimedia- it - telecom service division, Alcatel-Lucent
2015 - 2017
Head of business unit IT & cloud and member of the executive leadership team, Ericsson
2018 - present
Present, global head of telecom, Amazon Web Services
requirements, but to enable them to do more with their data. “For cloud providers, this is an opportunity to tap into the power of analytical technologies, such as AI, and help businesses better understand their customers and launch new services,” he says. “Cloud providers therefore need to have agility at the core of what they do, enabling enterprises to quickly scale out new services, to bring new ideas to market, and to adapt to changing conditions by rolling up and down.” One of the more talked about aspects of
Moving to the cloud requires a new way of thinking. When technology is available ondemand, old world innovation and procurement cycles of weeks,Capacity or in most cases months, don’t work” Jean-Philippe Poirault, Global head of telecom, Amazon Web Services
two or three providers but once they begin to understand the practicalities of doing so, very few end up going down this route. “Most predominantly pick one provider,” he says. “The reasons that they don’t spread it evenly are a few-fold. This forces them to standardise on the lowest common denominator, and these platforms are in widely different spots at this point in time.” He also points out that it’s a big transition to go from on-premises to the cloud. So if you force teams not only to make that transition, but then on top of it to have to be fluent in multiple cloud platforms, it’s tough. “Development teams hate it and it’s pretty wasteful in terms of resources,” he says. So what does it boil down to for the enterprises? In a nutshell, its reliability. They need to be able to count on their digital infrastructure, applications and services regardless of what else is going on around them Poirault says. Additionally, he believes that enterprises increasingly expect cloud providers to not just meet basic infrastructure capacitymedia.com
the public cloud is security and visibility. AWS has seemingly managed to successfully navigate this aspect of cloud computing, even in multi-cloud environments.
Securing the cloud Unsurprisingly security is a top priority for AWS with the company adopting the same security isolations that are used in a traditional data centre. These include physical data centre security, separation of the network, isolation of the server hardware and isolation of storage. “We have a shared responsibility model with the customer; AWS manages and controls the components from the host operating system and virtualisation layer down to the physical security of the facilities in which the services operate, and AWS customers are responsible for building secure applications,” he explains. In addition, the company provides a wide variety of best practices documents, encryption tools, and other guidance its customers can use in delivering application-level security measures.
On the wholesale side of things, carriers are in the midst of a transformation across all business domains, which include digital, IT and network. “For wholesalers, the transformation of the network and a move to softwaredefined networking is an opportunity to enable their customers to provide their businesses with the tools to get more out of their network – especially when it comes to using data to develop powerful insights and better services,” says Poirault. He points out that wholesalers have created flexible networking infrastructure with zero touch provisioning that is easily configurable, that can be adapted without having to change lots of equipment, and that simplifies access to data throughout the network. This flexibility is key for their customers whose business demands change frequently.
Shift in culture As much as the cloud is a technological change there is also an internal cultural shift that occurs as well. “Moving to the cloud requires a new way of thinking. When technology is available on-demand, old world innovation and procurement cycles of weeks, or in most cases months, don’t work,” he explains. The remedy from AWS is to establish an AWS Cloud Center of Excellence when working with large enterprise business. This is a dedicated business unit within the organisation that is focused on helping with the cultural changes needed to get the most from the cloud. “This can be everything from setting up governance frameworks, so cloud consumption can happen in line with an organisation’s regulatory obligations, through to developing training and certification programs to up-skill all employees on AWS technologies and new ways of thinking,” continues Poirault. In addition, the company also offers Digital Innovation Training for its customers, which are workshops that help enterprise businesses to move faster, increase their decision making, and reduce the cost of experimentation. “At Amazon, Jeff Bezos has always said: ‘If you’re going to take bold bets, they’re going to be experiments and if they’re experiments, you don’t know ahead of time if they’re going to work. Experiments are, by their very nature, prone to failure. But a few big successes compensate for dozens and dozens of things that didn’t work.’ This is one of the foundational principals of Amazon and something we teach customers about, when moving to the cloud,” he adds.
80 | the big interview: jean-philippe poirault
Emerging trends Looking ahead data and emerging technologies like AI, Machine Learning and 5G will play a big part in the future cloud trends in the wholesale space. “There’s been a huge explosion in the volume of data transmitted across networks over the past decade or so, and we expect a further exponential explosion of connected things – and therefore data – driven by Industrial IoT, 5G and the need for edge cloud computing,” he says. For 2019 he predicts that wholesale carriers will increasingly deploy AI and Machine Learning systems in a bid to automate and optimise operations while also capturing, analysing and monetising the data travelling across its networks. Moreover, AI and Machine Learning create models that can accurately predict when network usage is likely to spike or drop. Laying the foundation for powerful auto-provision tools that can effectively allocate bandwidth and network capacity. Wholesalers can also deploy these technologies to create fault prediction capabilities that can anticipate when equipment might break or malfunction. As 5G becomes more broadly available, the need for edge computing becomes increasingly important. As carriers seek to accelerate their digital transformation, they are investing in building out consumer use cases that leverage the unique low latency characteristics of 5G. “Throughout 2019, AWS has been in deep collaboration with several leading carriers to understand the challenges they will face in deploying edge cloud,” adds Poirault. “And, in traditional AWS fashion, we will work backwards from the customer to develop the services to meet that need.” When it comes to the Internet of Things (IoT), Poirault anticipates that ten years from now, most company’s on-premises footprint will not be servers - virtually all be in the cloud – instead, it will consist of connected devices. “These sensors are typically not very large, with a small amount of CPU and a small amount of disk. The cloud therefore plays a disproportionately important role in IoT deployments, as it supplements these devices to provide computing power and storage space,” he says. “Given the sheer diversity of potential IoT deployments across many verticals, it’s important that cloud providers can provide lots of functionality at the edge to address these needs, and we’ve placed a lot of importance on that at AWS.” Ultimately, cloud computing has a huge role to play in these emerging technologies. It provides a platform to democratise emerging technology, as it
The AWS Cloud spans 66 Availability Zones within 21 geographic Regions around the world, with plans for 12 more Availability Zones and four more Regions.’
enables businesses to tap into these without having to build all the complex infrastructures in-house. There is a huge opportunity for cloud providers to help businesses establish use cases for these technologies and expand them into new areas. Recently theCapacity company ventured into another much talked about emerging technology. In May 2019, AWS announced the availability of its Amazon Managed Blockchain, a managed service that simplifies the ability to create and manage scalable blockchain networks. Customers typically create blockchain networks using frameworks like Hyperledger Fabric and Ethereum, but setting up the networks using these frameworks is difficult and time consuming. Each member of a blockchain network has to provision hardware, install software, create and manage certificates for access control, and configure network settings. Additionally, there is a lot of work
Throughout 2019, AWS has been in deep collaboration with several leading carriers to understand the challenges they will face in deploying edge cloud” Jean-Philippe Poirault, global head of telecom, Amazon Web Services
involved in scaling the network. “Amazon Managed Blockchain is a fully managed blockchain service that makes it easy and cost effective for customers to create and manage secure blockchain networks that can scale to support thousands of applications running millions of transactions,” Poriault says. “Customers simply choose their preferred framework, add network members, and configure the member nodes that process transaction requests. Amazon Managed Blockchain takes care of the rest, creating a blockchain network that can span multiple AWS accounts and configuring the software, security and network settings.”
Build and innovate The plan for AWS and its ventures in the cloud is to simply build and innovate. “Innovation is in our DNA, and our structure and approach to product development and delivery is fundamentally different from other IT vendors,” Poirault says. “We’ve never rolled something out from day one as an unmitigated success - you have to keep iterating and listening to customers around what they care about and keep building it.” With such offerings as AI-based service Amazon SageMaker to analyse network data and Amazon Simple Storage Service that enables wholesalers to reduce the costs of data storage and retention, 2019 will be a continuation of these efforts to meet the needs of its customer at AWS according to Poirault. “In a sense, 2019 will be much like any other year for AWS – another year to get closer to customers, to better understand their needs and to develop new ways to fulfil and anticipate them.” june/july 2019
Brodynt Global is the only pure wholesale internet access DQG QHWZRUNLQJ KDUGZDUH SURYLGHU RÎ?HULQJ VHUYLFHV LQ countries and territories. With headquarters in Barcelona, it has recently opened a new RÉ?FH LQ $XVWLQ 7; %URG\QW KDV EHHQ UHFRJQL]HG DV WKH IDVWHVW JURZLQJ FRPSDQ\ LQ (XURSH E\ WKH )LQDQFLDO 7LPHV Marcus MuĂąoz, Co-Founder of Brodynt Global: Who is Brodynt? Brodynt was established in 2012, and counts with a growing team of 40+ members spread among Barcelona, Austin, London and Bangalore. We are the only pure wholesale internet access aggregator in the market. We are a one-stop-shop for global connectivity. Our customers are local and global ISPs, Carriers, System Integrators, Agencies and SDWAN Players. :H DUH GLÎ?HUHQW EHFDXVH LW LV LPSRUWDQW IRU XV WR QRW JHWWLQJ LQ FRPSHWLtion with our own valued customers â&#x20AC;&#x201C;we prefer creating long term partnerships with them. You describe Brodynt as neutral. What does that mean?
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Brodynt constantly evaluates and monitors our supplier base for their perIRUPDQFH LQ GLÎ?HUHQW DVSHFWV VXFK DV TXRWLQJ SURYLVLRQLQJ DQG VXSSRUW This creates an ever evolving per-country leaderboard based on competiWLYHQHVV DQG VHUYLFH TXDOLW\ ZKLFK KHOSV XV WR LPSURYH GD\ E\ GD\ What problems does Brodynt solve for its customers? 'HDOLQJ ZLWK KXQGUHGV RI VXSSOLHUV LQ GLÎ?HUHQW FRXQWULHV WLPH ]RQHV ODQJXDJHV DQG XVLQJ GLÎ?HUHQW FXUUHQFLHV KDV SURYHG WR EH D JUHDW KDVVOH %URG\QW VLPSOLČ´HV WKH SURFHVV WR WKH PLQLPXP H[SUHVVLRQ E\ WDNLQJ FDUH RI QRW RQO\ DQ DFFXUDWH DQG FRPSHWLWLYH TXRWLQJ EXW DOVR VHUYLFH GHOLYHU\ [ VXSSRUW DQG XQLČ´HG ELOOLQJ LQ RQH VLQJOH FXUUHQF\ Î&#x2013;Q VKRUW ZH PDNH global connectivity really easy.
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A journey towards the multi-cloud T
he ever-increasing demand for rapid connections to the cloud means telcos are having to become more agile in connecting customers up to clouds. This is in light of the continued inexorable rise of the cloud. Although public cloud will grow faster, both public and private workloads are set to continue rising, at a compound annual rate of 28% and 11% respectively, according to Cisco figures. Meanwhile, 85% of companies surveyed in a recent IBM report were already operating in multi-cloud environments. Amid these trends, telecoms carriers are creating products that facilitate links with the major cloud service providers (CSPs) and deepening their relationships with them to help fulfil the need for multicloud environments, ensuring they can offer customers a comprehensive line-up of options. This is also linked to the need to move towards virtualisation and automated, distributed networks. Customers are demanding a “much more dynamic and agile environment” in which they can interact in real time with their network services, says Vincent English, CEO at network-as-a-service (NaaS) provider Megaport. And he believes this necessitates partnerships to get there. In the telecoms industry as a whole, he says, connecting up to the CSPs can still be cumbersome in the early stages of the move towards end-to-end automation and virtualisation. He thinks this will ultimately improve, but that in the meantime Megaport has the tools to give partners seamless, rapid connectivity.
To do this, it uses a software-defined network (SDN) built on a physical network that connects over 465 data centres globally. Megaport can enable Capacity via relationships multi-cloud connectivity it has with major CSPs including Amazon Web Services (AWS), Microsoft Azure, IBM, Google and Alibaba. “What we have works, is already there, and gets customers up and running quickly so they don’t have that huge capex cycle, which may take a bit of time,” says English. “We have a proven ecosystem of CSPs and a global network.” Recent partnerships that the company has struck up with players such as HGC, NTT Malaysia and Orixcom to help improve cloud access for carrier and enterprise customers attest to such benefits. He foresees increased traction for quickly connecting up among more localised carriers too, such as with Megaport’s recently announced partnership with US Midwest telecoms provider Bluebird Network. Partnerships like these are good for the whole industry because they help improve the density of connections, adds English, aiding to meet the demands of developing technologies such as the Internet of Things (IoT) and AI. “Connectivity is the cornerstone of having any of that work.”
Greater agility Bill Lambertson, director of cloud industry solutions for the telco industry at IBM, reiterates the need for carriers to be more agile in the cloud world and offer differentiated services on top, something he believes partnerships can help with better than past attempts to go it alone.
“Telcos have traditionally invested in long-tail kinds of businesses, but the world of cloud really doesn’t allow you to have that time to be successful,” he says. He adds that carriers also need skills on the systems integration (SI) side, something that a CSP such as IBM can again step in and help with. Establishing partnerships that are more than mere reseller arrangements provides a significant opportunity for carriers, says Lambertson: “It gives the telco stickiness and it provides added value to business customers.” IBM recently entered into a strategic agreement with Vodafone Business that will see customers provided with open, flexible technologies they need to integrate multiple clouds and prepare for the coming digital transformation enabled by AI, 5G, edge and SDN. Additional services could also include blockchain and the type of enhanced security needed in a multi-cloud hybrid environment. “Telcos are in a position where they can deliver an end-to-end secure solution, and ensure compliance and data privacy for their customers,” says Lambertson. At CenturyLink, Dave Shacochis, vice president of hybrid IT product management, says the company can add value to its cloud services through the threat intelligence it can access via its extensive global network. “CenturyLink’s investments with the different cloud service providers are really around creating adaptive connectivity paths to those cloud environments and then looking for opportunities where we can help in the area of IT agility, managed june/july 2019
feature: multi-cloud | 83
services and the system management realm, as well as with connected security,” he says. “It’s amazing how much the industry has shifted,” says Shacochis, from a more ad hoc integration between enterprises and public clouds to more secure, reliable, direct connectivity aided by carriers like CenturyLink.
Image: Adobe Stock
5G and the edge The dawn of 5G and growing focus on edge services are also set to affect the landscape between carriers and CSPs. At performance assurance company Accedian, chief strategy officer Richard Piasentin says the potential for network slicing with 5G can bring extra opportunities between CSPs and telcos by enabling carriers to offer dedicated, secure “slices” reserved for particular missioncritical applications to third parties, improving customer experience. “We’re very active with carrier customers in talking about what that looks like,” says Piasentin, with the company looking into how to implement that with them. CSP partnerships are, meanwhile, set to be even more important as networks become more distributed in the move towards 5G, believes Lambertson. “The battleground is moving to the edge, and many telcos are acknowledging that they can’t win that battle alone,” he says. “They want to move up the stack and need partners to do it.” For meeting needs at the edge, some carriers are building partnerships with edge data centre players that wrap in services from the telco enabling connections to major cloud providers. Telia Carrier, for instance, last September teamed up to offer its Cloud Connect service with edge data centre provider TierPoint in 25 facilities across the US.
New products Telia Carrier launched Cloud Connect itself a year ago, one of an array of cloud products carriers have been launching and moves they have been making to help boost customer connections to providers such as Microsoft, Amazon, Google and IBM. For Telia Carrier, the service was also aimed at opening up these connections directly to enterprises, and wholesale customers. There is room now for Telia Carrier to grow the product by adding more clouds, such as second-tier, third-tier, public and governmental clouds, says Mattias Fridström, vice president and chief evangelist at the company. “There are a lot of clouds to add,” he says. “We don’t want to influence an enterprise decision on what cloud to use. Whatever cloud they capacitymedia.com
want to use, we will be there.” Meanwhile, Deutsche Telekom Global Carrier last year debuted its Secure Cloud Connect service for wholesale and enterprise customers in a bid to make it easier for customers to connect up to major cloud providers via a private connection. The service, aimed at offering a secure cloud environment for mission-critical applications, enables customers to reach 40 CSPs via direct relationships. DT Global Carrier, which says the service has seen rapid uptake, is now striking more direct partnerships with CSPs rather than those it provides through its relationship via a data centre provider. This helps reduce process complexity and saves on costs, says the company. Having already previously struck direct partnerships with other leading cloud providers, DT Global Carrier has now also struck a deal with Google.
“One of the biggest barriers to cloud adoption in Africa is high-quality, reliable and affordable connectivity,” says Behr. “This cannot be solved by the CSPs alone, especially last mile. We need to work with them to match their future expansion plans with our own.” And carriers are putting in place strategies to enhance their knowledge of cloud products. Ian Massingham, director of developer technology and evangelism at AWS points to Verizon’s investment in AWS-specific training facilities known as “dojos” to help employees boost their knowledge of the CSP’s technologies and learn how to innovate quickly and at scale. And with the growing need for carriers to automate networks, Massingham flags up the company’s recently unveiled Outposts offering to help enable seamless hybrid cloud. “AWS Outposts could provide a potential mechanism for carriers to embed AWS resources directly within
There are a lot of clouds. We don’t want to influence an enterprise decision Capacity on what cloud to use. Whatever cloud they want to use, we will be there” Mattias Fridström, vice president and chief evangelist, Telia Carrier
“Secure Cloud Connect is quite innovative,” says Jasmina Cehajic, head of product management for access and transport services at DT Global Carrier. “We have seen a very positive response over the past year. Customers are extremely pleased with the ease of set-up and the cost savings, as well as our ability to enable their multi-cloud strategy.”
Time for a change Carriers have much to gain by evolving how they operate as they team up with CSPs, says David Behr, group chief digital officer at Africa-focused Liquid Telecom. Compared to the CSP ethos of real-time delivery and low barriers to entry, telcos tend to have a higher entry cost and longer delivery times, he says. “They need to start thinking more like cloud providers and understand that software is literally taking over the world.” There is a similar need in Africa to work with CSPs, where he believes Liquid Telecom is uniquely positioned to help. The company has recently been expanding the availability of Microsoft Azure across the continent.
their network for additional use cases, such as network functions virtualisation [NFV],” he says. To facilitate the transition to new cloud models, industry body the MEF is meanwhile helping push things forward through the development of its framework for so-called MEF 3.0 services that will aid the move towards a more on-demand, cloud-centric experience. The MEF is talking to carriers to examine what the future value chain will look like, with a need to make “frictionless” what can be highly complex cloud models between the different types of provider and as carriers connect to more clouds, says Pascal Menezes, CTO at the MEF. By developing this, he believes, carriers will have more of an opportunity to add the value needed in the cloud market of the future. “Communications services providers worldwide have to think of value-added products that go beyond just connectivity, and add on to that greater stickiness that creates more value between the cloud providers and them,” he concludes.
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76% annual growth rate takes Alibaba into the clouds It’s been a decade since Alibaba launched its cloud business in China and now the company has expanded its services across the world. Yeming Wang, deputy general managerCapacity of Alibaba Cloud Global, talks about the company’s global plans
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sk a westerner to list the biggest over-the-top (OTT) tech companies in the world and most will list Apple, Amazon, Alphabet – the owner of Google – and Facebook in an instant. Few, unless nudged, will include Alibaba, even though the Chinese group, headed by Jack Ma, is one of biggest companies in the world. At the beginning of 2018 it became the second Asian company to be worth more than $500 billion, and in early June 2019 its market cap was $392 billion. Since 2015 Alibaba has been expanding rapidly into cloud services. Alibaba Cloud has 56 availability zones in 19 regions around the world. It is one of the world’s top three infrastructures as a service (IaaS) and is China’s largest public cloud service provider. Yeming Wang is deputy GM of Alibaba Cloud and runs the operation in Europe, the Middle East and Africa. He spent most of his career in Huawei, starting two decades ago as a radio-frequency (RF) engineer and leaving the company only to join Alibaba, which has made huge progress since it moved into
cloud just 10 years ago. “Cloud computing revenue is growing 76% year-over-year,” says Wang. In Q1 2019 revenue was the equivalent of $1.15 billion, “primarily driven by an increase in average spending per customer. We are also seeing significant traction and diversification of customers and revenue.” During that quarter, “we continued to use our scale to lower the pricing of products and services in content delivery networks, security, database and network infrastructure – so that we are able to pass on cost savings to our customers.” There are “several new next-generation technologies that we have been focused on”, he adds. “These include global network solutions, which enable organisations to connect multiple regions within one network. There’s also data lake analytics (DLA), a server-less, high-performance and interactive query service that turns customers’ cloud storage data into insights with zero infrastructure setup.” Alibaba is venturing into blockchain-as-aservice (BaaS). This “is an enterprise-level platform service that helps customers build a secure and stable environment for blockchain
implementations”, says Wang. He adds that Alibaba Cloud has a service to counter distributed denial of service (DDoS) attacks. “We offer anti-DDoS premium, which is a range of techniques to help defend against DDoS attacks, including near-source cleansing with five scrubbing centres around the globe, an overall bandwidth capacity of over 2Tbps, and thus guaranteeing businesses have access to their required bandwidth after cleansing.” What is on Alibaba’s roadmap to become a truly global player? “Alibaba Cloud opened two availability zones in the UK in October 2018, in addition to its Frankfurt and Dubai data centres launched in 2016,” says Wang. “This expansion not only extends Alibaba Cloud’s capabilities within Europe, but also serves to highlight the provider’s ongoing commitment to the region. Alibaba Cloud’s local footprint is steadily increasing.” This European “pair of high performance availability zones will enable organisations in the region to accelerate the upgrade of their digital infrastructure, enabling more efficient digital transformation initiatives”, he says. “Business continuity is also a clear focus, with june/july 2019
the big interview: yeming wang | 85
1999
RF engineer, Huawei
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Head of RF team, APAC regional office, Huawei
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Head of overseas division, radio frequency planning department, Huawei
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Wireless solution sales manager, Netherlands, Nordics and Italy, Huawei Europe
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Director, wireless solution sales for western Europe, Huawei Europe
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Deputy general manager, Huawei Technologies Italia
2011
General manager, Huawei Technologies France
2014
President, HutchisonWhampoa global key account, Huawei Technologies
2016
General manager, Alibaba Cloud EMEA
cloud computing and big data by partnering with French local universities.” Beyond, the company is offering an expanding network of content delivery network (CDN) nodes and deployment regions, “including the first public cloud data centre regions in the Middle East – in Dubai – and Indonesia, a string of data centres in Asia, and a strong presence in North America, Europe and Australia”, he adds. The focus is to build a technologically inclusive IaaS platform to focus on platform as a service (PaaS), “and we want to see our SaaS [software as a service] partners grow on the Alibaba Cloud platform”, says Wang. “We also want to embed products and solutions into consulting plans to empower customers through our partners,” he adds, listing Deloitte, KPMG, and Accenture.
Cloud computing is important for both reducing the cost of running telecoms networks Capacity and transforming the telecoms business model” Yeming Wang, deputy general manager, Alibaba Cloud Global
dual availability zones offering stronger disaster recovery capabilities.” However, Amazon Web Services (AWS) is expanding its cloud computing operations in the Asia Pacific region, where it is now eighth in the market and has launched a data centre in Hong Kong. But will Alibaba remain the number one player in the region? “All data centres want improved reliability, increased availability and lower capex and opex,” says Wang. “We have proven time and again that we can deliver successfully on that market requirement. It’s our achievements in China that are helping us to win new business in other territories, like EMEA.” Alibaba has an ecosystem partner programme in the EMEA region now. Will this become a global platform anytime soon? Wang notes that in May 2019, Alibaba Cloud added nine partners to its EMEA ecosystem partner programme, which was developed to “strengthen the collaboration between Alibaba Cloud’s customers and partners in Europe, the Middle East and Africa,” he says. “Alibaba Cloud has also furthered its commitment in nurturing young talents in capacitymedia.com
“The more we offer, the more attractive Alibaba Cloud is to companies that want to work with or partner with us,” Wang says. Alibaba’s cloud CDN “is a distributed network built on top of a carrier network that solves internet congestion and speeds up access to your web applications. Currently, Alibaba Cloud has more than 2,500 nodes in more than countries across six continents.” But how is the Alibaba Cloud management team developing the company into a more technologically inclusive platform? Is it focusing more on SaaS? “Today, Alibaba Cloud is the third largest worldwide cloud service provider and has grown the fastest for the last three years,” he says. “We have suceeded in providing a comprehensive suite of cloud services and we have served over one million paid customers.” For years, he says, the telecoms industry has been working to put in place the basic cloud technology infrastructure that underpins the foundation of the internet society. “Additionally, Alibaba Cloud has worked successfully with top telco companies in and beyond China to provide scalable and flexible cloud technology services with a
cloud native infrastructure.” Does Wang see that the advancement of machine learning and artificial intelligence (AI) are set to revolutionise the marketplace? “AI is such an exciting concept,” he says. “AI is not just a buzzword. It’s more profound, and should carry the additional meaning of ‘actionable insight’.” And how is Alibaba Cloud tackling this opportunity? “We’re much more interested in applying technologies to solve real-world, complex and urgent problems. Take, for instance, actionable insights for medical professionals when it comes to identifying diseases more effectively through better image scanning and analysis.” Are there opportunities for AI in data centres? Wang is confident: “Our latest data centres offer customers an unparalleled level of service with complete access to a range of cloud services from machine learning capabilities to predictive data analytics.” Let’s turn to the company’s global BaaS, now available in North America, EMEA, mainland China, Hong Kong, Singapore, Japan and Australia. The offering “is part of our overall cloud business strategy, which is to provide an integrated platform for enterprises to deploy their applications and continue to grow”, says Wang. “Blockchain is a revolutionary technology and will become a key driver for innovation as it enhances the level of trust and creates greater efficiencies across industries and borders,” he explains. The service “has already built a proven track record of enabling multi-scenario applications, for example in the public benefits system and the logistics and medical industries, based on its decentralised and distributed storage and anti-tampering features”. Alibaba had the largest number of blockchain patents in the world for the two consecutive years of 2017 and 2018, he adds. “What we’ve seen is that the public cloud has quickly become a norm while multicloud allows vendors to focus on providing a ‘solution-as-a-service’ to address greater, organisation-wide pain-points rather than just siloed IT issues,” says Wang. “What we anticipate is that as cloud infrastructure becomes a commodity, resellers and channel partners may struggle if they are only familiar with one certain cloud technology. Our suggestion is that it is imperative to gain expertise in verticals, as is local country and region insight. We think that with those value adding pieces in place, partners have a better chance to stand out from the crowded marketplace.” The synergy between edge, cloud, network, and devices is central to the company’s offering to the telecoms sector, he says. “We consider cloud computing to be important for both reducing the cost of running telecoms networks and transforming the telecoms business model from product to service provider.”
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Top cloud products: Keeping the limits of businesses sky high A GREAT SEARCH WAS UNDERTAKEN FOR THIS EDITION BY LAURENCE DOE IN HIS QUEST TO FIND SOME OF THE BEST APPLICATIONS OF CLOUD PRODUCTS. THIS IS THE LIST OF THE BEST CLOUD SERVICES, SOFTWARE AND PLATFORMS FOR ENTERPRISES Cisco CloudCenter Suite
This multicloud management solution allows enterprise IT teams to securely design, deploy, and optimise infrastructure and applications across multiple clouds from a single point of access. It delivers a consistent user experience, while controlling costs and aims to help the user meet compliance requirements. CloudCenter Suite is one of the most mature products in Cisco’s cloud portfolio. It has evolved beyond minimum viable product status, to include a rich suite of features that address cost optimisation and a wide array of cloud workload management capabilities. While in the beginning it was a one-size-fits-all proposition, now it’s available in three different editions that are designed to accommodate the needs of companies at different stages of the cloud adoption journey. It also comes as a software-as-a-service (SaaS) delivery model. There are a lot of cloud workload
management products out there that focus on the three major public clouds plus OpenStack and VMware. Where Cisco believes CloudCenter Suite really Capacity stands out is in the breadth of disparate platforms that it can manage workloads across. It covers boutique clouds that most solutions would never even think about, but that Cisco customers have asked for. By supporting such a rich ecosystem of cloud providers, Cisco make the infrastructure as a service (IaaS) layer accessible to tech teams without forcing them to learn the IaaS platforms themselves. The CloudCentre’s evolution will come as Kubernetes ushers containers into first class citizenry, as Cisco will provide more value to that pipeline.
Cisco states: “Specifically, we know that cost reporting is top of mind for our DevOps customers, and we’ve spoken to that directly with the introduction of the Cost Optimizer module in CloudCenter Suite 5.0, but moving forward we will be pouring even more effort into expanding the capabilities of that module. We know that DevOps are particular about their toolchain, so we want to be sure we meet their needs.”
enterprises a one-stop solution with self-service deployment. It has the ability to manage all of a customer’s cloud and network products on a single platform that makes cloud services more visible, accessible and manageable. CMI has an extensive and reliable global network, with nine self-built submarine and eight terrestrial cable resources, five
self-built data centres, 164 points of presence (PoPs) and 60 Cloud Connect PoPs, providing enterprise customers with a 99.99% guaranteed uptime service level agreement (SLA). CMI’s iSolutions cloud-network integration solution allows customers to review cloud products, configure what they need, and deploy within seconds, saving time and resources. CMI is now seeking to bring more cloud service providers onto its iSolutions cloud-network integration platform in order to enrich the cloud-network ecosystem and address the specific needs of customers in different industries.
CMI iSolutions
China Mobile International (CMI) launched its iSolutions cloud-network integration to give multinational
june/july 2019
feature: five top cloud products | 87
Epsilon Infinity
This portal-driven platform takes charge of local, regional and global connectivity by bringing networking into the cloud era. It provides enterprises and service providers with a suite of connectivity and communications services. Users of Infiny can connect to over 100 data centres in Asia Pacific, Americas, Europe, Middle East and Africa with on-demand access to Internet Exchanges (IX) and direct connection to world-leading Cloud Service Providers (CSP). Epsilon says that, “in the near future”, users of Infiny will continue to see more services and global destinations being added. It adds: “We will be enabling Infiny users to deliver 100G ethernet services on-demand globally as well as adding multi-cloud capabilities and SD-WAN orchestration capabilities on the platform. “User experience on Infiny will also continue to evolve, allowing users to create multiple orders with shopping carts and getting instant assistance via live chats. We are making Infiny a one-stop shop for all enterprises and service providers’ connectivity needs.” Using APIs, Epsilon has also successfully
interconnected Infiny with its partner’s SDN platform, SD-Cloud Express by DCConnect, to provide on-demand connectivity into China. Users can instantly interconnect with an extended network of over 118 data and connect to local CSPs, Alibaba Cloud and Tencent Cloud. Mark Smith, managing director at DCConnect, comments: “We are delighted to partner with Epsilon to provide our China customers access to fast, flexible and intelligent SDN services across the globe. They can instantly connect across both our SDN platforms seamlessly with a single user experience. The Infiny platform aligns with our vision of facilitating powerful networking solutions that are both scalable and agile.
Capacity
This partnership is driving the networking market forward and shows new possibilities for SDN.”
Product features:
• Launched in 2017 with over 500 users today • On-demand, comprehensive set of ethernet and voice services • Accessible via web-based portal and mobiles apps • API-enabled for seamless integration • Network analytics and customisable dashboards • Cross-carrier automation deployments delivering two-way inter-SDN platform orchestration • White-label and partner model
PCCW Global Console Connect
Console Connect combines PCCW Global’s worldwide IP network with software automation to deliver on-demand, private, global connectivity. Console Connect customers can instantly provision direct connections to remote data centres, partners and cloud services. The Console Connect Software-Defined Interconnect (SDI) platform is an industry response to the need from enterprises operating internationally for increasingly complex, sophisticated and secure connectivity. Console Connect is essentially network automation software, allowing users with minimal technical ability to quickly spin-up virtual private Layer 2 and Layer 3 connections, bypass the unpredictable public internet and directly connect to their cloud applications, partners and business locations. Console Connect enables secure, on-demand connectivity to hyperscale cloud
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providers including Amazon Web Services, Microsoft Azure, Google Cloud, IBM Cloud, Tencent Cloud, Alibaba Cloud, IBM Cloud and Qing Cloud. The product will evolve with PAYG options and rates for connectivity that can be accessed through a simple-to-use pricing calculator, which lets the customer build a detailed quote for customised on-demand connectivity. Although existing PCCW global customers currently need to order a separate Console Connect port to use the SDN service, they will soon be able to access it from their existing port. Console Connect continues expand into more data centres, clouds, SaaS and integrate new regional carriers into its ecosystem. Leo Liu, general manager for Alibaba Cloud Hong Kong, Macau and Korea, says: “Together with PCCW Global, we are making it easier for customers to accelerate their digital transformation process and with the Alibaba Cloud Express Connect, we can enable rapid provisioning of capacity to Alibaba Cloud as a result of our integration with Console Connect.” Ronnie Klingner, president of mobility and digital solutions, PCCW Global, says: “The PCCW Global IP network is at the heart of Console Connect. We go to many parts of the world that others do not.”
Console Connect’s competitive advantages:
• Runs on the PCCW Global international MPLS network, which is physically separate to the general internet, which gives it a strong performance edge over its SDI competitors (which have to rent bandwidth from network operators), and offers enterprisequality bandwidth and performance with security, guaranteed packet delivery, uptime and performance. • Connects globally to 200 carriers in 76 data centres over 34 countries and connecting seven of the world’s leading public clouds. The use of APIs makes integrating the platform with clouds or other networks very straight-forward and secure, and appealing to the local, regional carriers for the ‘last mile’ connections off PCCW Global’s international network. • Consumed as bandwidth-ondemand, based on the location of the A+B points being connected, the bandwidth consumed, and the duration of the connection: a day, a week, a month, or a year – up to three years in advance.
88 |
Aryaka Smart Connect
This SD-WAN service is designed to support customers making the move from legacy network architectures to cloud-ready ones. The ‘plug-n-play’ cloud connectivity has pre-wired cloud connects into public cloud providers like AWS and Microsoft Azure, without the need to spin up operationally complex virtual machines and manage them. This service allows for the gradual implementation of a software-defined solution, ensuring that existing on-premises and web applications continue to function. It supports Amazon Web Services, Google Cloud, Oracle, and Office 365 and delivers multi-cloud access in just 30 milliseconds, from data centre to both IaaS and/or SaaS. Business can make the move from legacy MPLS to a software-defined solution and have the new Aryaka network deployed in a matter of days. It allows them to be responsive to the needs of their business and align their WAN transformation efforts with the company’s digital transformation goals. It also makes their business ready for the multi-cloud era, globally.
Aryaka’s Cloud connect can bring about a seamless managed experience between wide-area connectivity and public clouds or SaaS providers without any incremental infrastructure. With over 30 points of presence globally, the Aryaka solution deploys in a matter of hours to any number of global locations. Aryaka Smart Connect addresses all challenges experienced by businesses needing to make the step to a fully software-defined network and has one or more pre-existing Cloud environments to integrate into it. Aryaka owns its own network of global PoPs, as well as WAN optimisation and security software including partnerships with the likes of Zscaler and Palo Alto networks, giving enterprises complete and secure control over internet traffic, and even allowing them to categorise and prioritise different types of traffic. Joshua Bancroft, senior research analyst, cloud and data centre research practice at IHS Markit, says: “As enterprises continue to undergo digital transformation, they are
Capacity
having to re-think their WAN strategies to include computing at the edge, which creates additional WAN management complexity. “Enterprises are looking to reduce this complexity by having service providers implement and manage their WAN as they adopt SD-WAN. “According to a recent IHS Markit survey, SD-WAN as a managed service, bundled with other NFV services and connectivity, will be the preferred consumption method by the end of 2019. Service providers that focus on providing SD-WAN as a managed service, with global connectivity, address an important market requirement.”
market trends: data centres & cloud | 89
DATA CENTRES & CLOUD
H
yperscale operator capex in Q1 of 2019 has dipped in comparison to the record levels seen throughout 2018, according to Synergy Research Group, which has also found that there is a clear market leader in the APAC region for cloud providers.
A report by the group on hyperscale operator capex has found it totalled just over $26 billion in the first quarter of this year. Last year’s first quarter was boosted by Google’s $2.4 billion purchase of Manhattan real estate, but, excluding that acquisition (shown in the graph below), the Q1 capex is down by 2% from the same period in 2018. Synergy’s latest cloud market report also found that China is featuring strongly in the ranking of leading cloud providers in the APAC region (see page 96). While Amazon maintains its number one position in the region, three of the top six are Chinese companies. Alibaba, Tencent and Sinnet have claimed the top spots in the regional leadership table while Baidu lies just outside the top six. Chinese cloud providers now have a 40% share of the APAC public cloud market.
Hyperscale and telco big spenders The top five hyperscale companies spending in Q1 were Amazon, Google, Facebook, Microsoft and Apple. Outside of the top five, other leading hyperscale spenders include Alibaba, Tencent, IBM, JD.com and Baidu. Much of the hyperscale capex goes towards building, expanding and equipping huge data centers, which have now grown in number to 458. Synergy has predicted that this number will rise to 500 in 2020. Though Q1 capex was down a little
from 2018, it was still up 56% from Q1 of 2017 and up 81% from 2016. The Q1 capex growth rates of nine out of the twenty hyperscale operators was in double-digits year on year. Synergy is expecting to see overall capex levels bounce back over the remainder of 2019. Hyperscale operator capex reached over $32 billion in Q4, 2018, according to the group, which surpasses each of the Capacity record-breaking first three quarters of the year. Full-year hyperscale capex jumped
43% to almost $120 billion. Telco capex was over double that of hyperscale operators, but notably telco spending remained at the same level as the previous two years. The top five hyperscale spenders in 2018 were Google, Amazon, Microsoft, Facebook and Apple. Coincidentally their aggregate 2018 capex was almost identical to the capex of the top five telco spenders – China Mobile, AT&T, Verizon, NTT and Deutsche Telekom.
30
Worldwide Capex per quarter ($B)
KŶĞͲŽī item
-2% y/y
25
20
15
10
5
0
Q1 16
Q2 16
Q3 16
Q4 16
Q1 17
Q2 17
Q3 17
Q4 17
Q1 18
Q2 18
Q3 18
Q1 18
Q1 18
Source: Synergy Research Group
Synergy Research Group’s data is based on analysis of the capex and data center footprint of 20 of the world’s major cloud and internet service firms. The top five spenders of Q1 2019 were Amazon, Google, Facebook, Microsoft and Apple. Other leading hyperscale spenders include Alibaba, Tencent, IBM, JD.com and Baidu. Hyperscale capex was primarily spent on the 458 data centres that are operating worldwide.
capacitymedia.com
90 |
Wholesale and retail colocation 2018 revenue from hyperscale customers: Colocation Market Growth by Segment & Customer Wholesale and retail 2018: • Colocation market growth of 10% • Wholesale hyperscale operator revenues grew 24%, retail 16%
Segment & Customer Category
Total ŽůŽĐĂƟŽŶ Hyperscale Operator Other Service Provider
Synergy’s Q4 and year-end colocation market data: • The sector grew to over $34 billion in 2018 • Growth was strongest in the APAC region, followed by EMEA and North America • Highest growth rates in China, Brazil, Hong Kong, Japan, Germany and Singapore
Enterprise Hyperscale Operator Other Service Provider Enterprise 0
5%
10%
15%
20%
ŽůŽĐĂƟŽŶ ZĞǀĞŶƵĞ 'ƌŽǁƚŚ ZĂƚĞ Ͳ ϮϬϭϴ Source: Synergy Research Group
China’s cloud dominance grows
Public cloud makes largest gains The global spend on data centre hardware and software increased by 17% in 2018, according to Synergy. Data centre infrastructure equipment revenues, including cloud and non-cloud, hardware and software, were $150 billion in 2018 – with public cloud infrastructure accounting for over a third of the total. Private cloud or cloud-enabled infrastructure represented just over a third of the total. The growth was driven by growing demand for public cloud services as well as the requirement for richer server configurations, which drove up the average enterprise server price. Public cloud infrastructure spending grew by 30%. Enterprise data centre infrastructure spending increased by 13%, which was impacted by a small decline in traditional, non-cloud infrastructure and a 23% growth in private cloud or cloud-enabled infrastructure. Servers, OS, storage, networking and virtualisation software combined accounted for 96% of the data centre infrastructure market, with the balance comprising network security and management software.
Public Cloud Leadership - APAC Region Rank
Total APAC Region
China
Rest of Region
Amazon
Alibaba
Amazon
#2
Alibaba
Tencent
DŝĐƌŽƐŽŌ
#3
DŝĐƌŽƐŽŌ
Sinnet
#4
Tencent
Baldu
Alibaba
#5
China Telecom
Fujitsu
#6
Sinnet
China Unicom
NTT
Capacity Leader
Based on public IaaS and PaaS revenues in Q1 2019 Source: Synergy Research Group
Data Center Infrastructure Market 150 Worldwide Revenues ($B)
In Q1 of 2019, public infrastructure as a service (IaaS) and platform as a service (PaaS) are the most prominent segments of the cloud infrastructure services market and account for the bulk of the revenues, with the balance coming from managed or hosted private cloud services. Synergy has also found that although APAC does not yet account for a third of the worldwide public cloud market, it is growing much more rapidly than either the North American or EMEA regional markets. The world’s largest cloud providers, who are all US-headquartered firms, may be challenged by Chinese cloud providers, which are benefitting from huge growth in their local cloud market. Synergy has found that language, cultural and business barriers will cause some of those Chinese companies to remain tightly focused on their home market.
Market Leaders 1. ODMs 2. Dell EMC 3. Cisco 4 = HPE 4 = Huawei
+ 30%
75
+ 23%
1. Dell EMC Ϯ с DŝĐƌŽƐŽŌ 2 = HPE 4. Cisco
-0%
ϭ͘ DŝĐƌŽƐŽŌ 2. Dell EMC 3. HPE 4. Cisco
0 2017
2018 Source: Synergy Research Group
Data centre 2018 growth stats: • Cloud service revenues up by almost 50% • Enterprise SaaS revenues up by 30% • Search/social networking revenues up by almost 25% • E-commerce revenues are growing by over 30%
june/july 2019
analysis: network security | 91
WHOâ&#x20AC;&#x2122;S LURKING BEHIND THE BACK DOOR? IF THERE IS A BACK DOOR. NO ONEâ&#x20AC;&#x2122;S BEEN ABLE TO FIND ONE IN HUAWEIâ&#x20AC;&#x2122;S KIT, BUT ALAN ǧ ASKS IF WEâ&#x20AC;&#x2122;RE TAKING THE WRONG APPROACH TO NETWORK SECURITY
M
ake no mistake. The telecommunications industry is driven by the US-versus-China trade war. The first battle in the telecoms field was over ZTE in 2017-18 and the second, still raging, is over its Chinese rival, Huawei. The US is alleging that Huawei canâ&#x20AC;&#x2122;t be trusted because it is controlled by China and the Chinese Communist Party, and that its network equipment is insecure, allowing China to spy on anyone whose traffic goes through Huawei systems. Huawei vigorously denies this â&#x20AC;&#x201C; though it would be surprising if it did anything other. It insists itâ&#x20AC;&#x2122;s owned by its employees, and some Huawei staff-shareholders have told me how much they get in dividends. The only on-the-record observation we have by a major tech company was in June 2013 when Google offered a comment to the Guardian newspaper, which was working with the New York Times on the Edward Snowden revelations. â&#x20AC;&#x153;Google cares deeply about the security of our usersâ&#x20AC;&#x2122; data. We disclose user data to government in accordance with the law, and we review all such requests carefully. From time to time, people allege that we have created a government â&#x20AC;&#x2DC;back doorâ&#x20AC;&#x2122; into our systems, but Google does not have a back door for the government to access private user data.â&#x20AC;? Two crucial points in that paragraph: Google discloses user data when instructed by the US government, just as the US says Huawei will on instruction from Beijing. Second, it doesnâ&#x20AC;&#x2122;t provide a back door. Of course, all regulated telecoms operators in all countries have to provide information to law-enforcement agencies, and this is no secret â&#x20AC;&#x201C; though something telcos donâ&#x20AC;&#x2122;t like talking about. But, back doors? One of the persistent allegations about Huawei is that it provides back doors to the Chinese authorities, back doors that could be capacitymedia.com
accessible worldwide, given the interconnected nature of the worldâ&#x20AC;&#x2122;s telecoms networks. Huawei strongly denies it, and no one has ever found any sign of them â&#x20AC;&#x201C; in particular those people whose job it is to look for back doors. The UKâ&#x20AC;&#x2122;s Government Communications Headquarters, GCHQ, is the countryâ&#x20AC;&#x2122;s digital intelliCapacity gence service, based in Cheltenham in the west of England. (Government officials in London speak of all spooks as â&#x20AC;&#x153;the friendsâ&#x20AC;?; GCHQ staff are â&#x20AC;&#x153;our friends in the westâ&#x20AC;?.) GCHQ runs a unit called the Cell, just over an hourâ&#x20AC;&#x2122;s drive away in Banbury, whose sole job is to tear apart Huaweiâ&#x20AC;&#x2122;s equipment and software. The Cell â&#x20AC;&#x201C; officially the Huawei Cyber Security Evaluation Centre (HCSEC) â&#x20AC;&#x201C; is staffed with security-vetted cyber intelligence professionals but is funded by Huawei as a cost of doing business in the UK. The Cell has been rude about the standard of Huaweiâ&#x20AC;&#x2122;s software engineering. In March, it reported â&#x20AC;&#x153;serious vulnerabilitiesâ&#x20AC;? and said it could give â&#x20AC;&#x153;only limited assurance that the long-term security risks can be managed in the Huawei equipment currently deployed in the UKâ&#x20AC;?. The impression is given that this is because of sloppy engineering, not through deliberate policy, and Huawei has announced a long-term plan to upgrade its engineering standards at a starting price of $2 billion. But I spoke to one cyber security professional â&#x20AC;&#x201C; nothing to do with the Cell, GCHQ or Huawei, or indeed any telecoms company â&#x20AC;&#x201C; who has also looked at the companyâ&#x20AC;&#x2122;s software, and other vendorsâ&#x20AC;&#x2122; software. This person, speaking with me on a guarantee that I didnâ&#x20AC;&#x2122;t use their name or give any other identification, wondered whether sloppy could be a disguise or an
excuse. Itâ&#x20AC;&#x2122;s easy to insert â&#x20AC;&#x153;innocuous-looking bits of code that are maliciousâ&#x20AC;?, my contact said. Many vendors â&#x20AC;&#x153;have iffy software tooâ&#x20AC;?, though no one has raised the same sort of issues. As a board-level executive with one of the top European telcos said to me at Mobile World Congress in Barcelona in February, â&#x20AC;&#x153;the difference is that European and North American countries are democracies and China isnâ&#x20AC;&#x2122;tâ&#x20AC;?. Much has been made of the UKâ&#x20AC;&#x2122;s National Security Councilâ&#x20AC;&#x2122;s apparent decision in April to allow Huawei kit to be used in the radio access network (RAN) for 5G but not in the core. Vodafone already uses Huawei kit in its RAN and told Capacity in March that it wouldnâ&#x20AC;&#x2122;t use the vendor for the core. Is that wise? I turn back to my anonymous cyber security friend. This is what they said: â&#x20AC;&#x153;If I were going to bug someoneâ&#x20AC;&#x2122;s communications Iâ&#x20AC;&#x2122;d do it at the edge â&#x20AC;&#x201C; not in the core where the target data is overwhelmed by the gigabytes that are travelling along the fibres.â&#x20AC;? Think about the old movie image of a private detective in a grubby mackintosh bugging someoneâ&#x20AC;&#x2122;s phone. He wouldnâ&#x20AC;&#x2122;t go to the long-distance lines with his crocodile clips and tape recorder. Where you go is the telephone pole or junction box outside the targetâ&#x20AC;&#x2122;s home, or at least the relevant telephone exchange, where you can find what youâ&#x20AC;&#x2122;re looking for without needing to filter out the noise. Same with 5G. If you want to bug someone, go to the cellsites around the targetâ&#x20AC;&#x2122;s home and office, not to the core. Back in the early days of the web, people said you shouldnâ&#x20AC;&#x2122;t put anything in an email that you wouldnâ&#x20AC;&#x2122;t write on the back of a postcard. Weâ&#x20AC;&#x2122;ve forgotten that. Electronic communications are inherently incredibly insecure.
92 | appointments
Stephanie Liston Mischon de Reya London-based law firm Mishcon de Reya has appointed telecoms lawyer Stephanie Liston to lead its regulatory practice. Liston, who was once a board member of UK regulator Ofcom, has chaired panels and spoken at Capacity Media events. She is founder and director of Women in Telecoms and Technology. Liston is a qualified lawyer in the US, the UK and the British Virgin Islands (BVI). Among the law firms she has worked with before Mishcon are Baker & McKenzie, Freshfields, McDermott, Will & Emery, and WilmerHale. She has been a director of the European Competitive Telecoms Association (ECTA) and she became a board member of Ofcom in 2005. More recently she has been chief legal adviser to the BVI telecoms regulator.
Karen Kesner Chayora Chayora, the Hong-Kong-based data centre company, has named Karen Kesner as head of Americas and executive vice president. Kesner will lead multiple aspects of Chayora’s go-to-market and growth acceleration plans, including strategic partnerships, marketing, branding and comms for China entry and expansion. While based in Palo Alto, Kesner will also become member of the executive leadership team while reporting directly to Oliver Jones, CEO of Chayora. With over 20 years of experience, Kesner has held senior positions across sales, alliances and business development at companies such as Tata Communications, CenturyLink and Oracle. Kesner said: “It is an exciting time for American technology firms to build high value access in China’s fast-growing cloud-computing digital economy.”
Pathmal Gunawardana Tata Communications
Mike Casey Stack Infrastructure Stack Infrastructure has named Mike Casey as its new chief data centre officer. Casey will lead the engineering, commissioning and operations of Stack’s data centre portfolio, which is focused on the US market. Before joining Stack, Casey held senior leadership roles with T5 Data Centers including chief operating officer and president of T5 Facilities Management. Casey has also served as vice president at the Jones Lang LaSalle’s Project and Development Services group. and was a member of The Staubach Company’s National Contact and Data Center Practice. “I am excited to join Stack at this remarkable time of expansion and unlimited opportunity,” said Casey. “I look forward to building upon this solid foundation.”
Tata Communications has hired Pathmal Gunawardana as its new head of Americas. Gunawardana will be responsible for accelerating customer adoption of the company’s hybrid WAN, cloud enablement and business collaboration services across both North and South America. Gunawardana joined Tata in 2015 serving as vice president of sale for the Americas. In this role, he was responsible for driving the development of near and long-term go-to-market strategy in both service provider and enterprise segments in the region. Before joining Tata, Gunawardana worked for Juniper Networks as head of global mobility vertical sales. Gunawardana has also held positions with the likes of Nokia Siemens Network, Alcatel Lucent Technologies and Bell Labs. The US is Tata’s largest market.
Capacity
Steve Okeyo Telkom Kenya Telkom Kenya has appointed Steve Okeyo as the new managing director of its mobile division, succeeding Amer Atwi who has been with the company since 2016. Okeyo most recently served as director for regional sales and operations at Safaricom, where he lead various teams to deliver customer growth and revenue. He has also held the position of director for regional sales force effectiveness at Larfarge in Paris. This role involved spearheading a commercial change management programme across 60 global countries. Okeyo built 10 years of his career at The Coca Cola Company, and was its country manager for Uganda.
Aamir Hussain Collinear Former CTO of CenturyLink, Aamir Hussain, has been appointed as the new chief executive officer of wireless connectivity solutions provider Collinear. Hussain brings over 28 years experience in various technology and product development roles, including CenturyLink, where he worked towards the digital transformation of the customer facing and networking platforms in software-defined networking as well as a multicloud management platform. Hussain has also held senior leadership positions with Liberty Global, Civad, Telus, Qwest, Bellsouth and Motorola. “I’m pleased to lead the Collinear team as we bring the current product suite to market,” said Hussain.
Eugene Henegouwen Equinix Equinix has appointed Eugene Bergen Henegouwen as its new president of Europe, Middle East and Africa (EMEA). Henegouwen will also manage the country-managing directors, the regional development team and regional business development teams, ensuring the company drives high returns on its investments and accelerates interconnection growth. Henegouwen joined Equinix back in 2013 as senior vice president of sales for EMEA. During his tenure, revenues for the company tripled in six years, building a strong field sales organisation over 15 countries, a highly successful regional corporate sales team and a fullscale dedicated channel organisation. Henegouwen will oversee a regional team of 2,500 employees.
Mikkel Vinter Batelco Bahrain Batelco is undergoing a major restructuring diving its business into two separate entities. Batelco Bahrain will be the entity responsible for the retail and enterprise division division focussing on enhancing services and solutions for consumer and business customers,while the newly formed National Broadband Network will operate the country’s broadband network and deliver telecom services. Mikkel Vinter has become Batelco Bahrain’s CEO. He enters the role having founded Virgin Mobile, Middle East & Africa and served as its CEO from 2006 to 2016. Vinter has also held senior roles in Nawras in Oman, TDC in Denmark and Singtel in Singapore.
Tell us your move
Capacity is keen to hear from readers about new roles and appointments in the industry. Send details to natalie.bannerman@capacitymedia.com, with a high-resolution picture
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96 | innovation report: open source
OPEN UP NETWORKS SO COMPETITION WILL CUT PRICES ǧ
ǥ ǧ Ǥ ǧ
U
sing open-source equipment in mobile radio-access networks (RANs) could help to push costs down to half, according to a recent report. At the same time proponents of open-source software claim that their approach results in savings of $60 billion a year for consumers. In the software area, open-source is decades ahead of the hardware business. Linux, a family of Unix-like operating systems, has been around since 1991. Today it runs in everything from thousands of servers to my Chromebook laptop, and the Android operating system in my Nokiabranded smartphone is a derivative of Linux. Itâ&#x20AC;&#x2122;s everywhere in the telecoms industry. But open-source hardware? Thatâ&#x20AC;&#x2122;s still to catch up. The reasons are unclear â&#x20AC;&#x201C; though the logic behind its adoption is enormous. First, though, why is so much hardware not open-source? Thatâ&#x20AC;&#x2122;s the real question â&#x20AC;&#x201C; and the answer is, of course, to protect vendors. In other words, itâ&#x20AC;&#x2122;s anti-competitive. Think about the light-bulb. An opensource standard, founded by Thomas Edison, called the Edison screw means that you can buy a standard light-bulb anywhere in the world and be confident it will fit. Think about batteries. In shops from Beijing to Buenos Aires you can buy AA and AAA batteries, and a limited number of other sizes. If you buy a torch in Brisbane or Bulawayo, you donâ&#x20AC;&#x2122;t have to source a proprietary battery. It used to be the same with mobile phones. Now the industry has settled down to a couple of USB-based connectors plus Appleâ&#x20AC;&#x2122;s own variants. Openness provides choice and increases competition, thereby reducing prices for consumers. In telecoms hardware, the industry is fighting back, and it is leading in the RAN sector â&#x20AC;&#x201C; probably because the imminent arrival of 5G gives telcosâ&#x20AC;&#x2122; chief technology officers an opportunity to think carefully about the future. The move is being led by the O-RAN
â&#x20AC;&#x201C; open radio access network â&#x20AC;&#x201C; Alliance, a grouping of some of the worldâ&#x20AC;&#x2122;s most powerful mobile operators. Among them are AT&T and Verizon, the two biggest in the US; plus Sprint and Deutsche Telekom, which owns T-Mobile US and European variants of T-Mobile. Thereâ&#x20AC;&#x2122;s KT and SK Telecom from South Korea; Orange, TelefĂłnica and TIM from Europe (as well as Deutsche Telekom). KDDI and NTT Capacity DoCoMo of Japan are members, as is Telstra from Australia. And both China Mobile and China Telecom. Thatâ&#x20AC;&#x2122;s one of the best things about this open-source movement â&#x20AC;&#x201C; it unites companies from across the world even if government authorities say they shouldnâ&#x20AC;&#x2122;t be talking. This universality also applies to another open-source movement, the Open Networking Automation Platform (ONAP), which shelters under the wing of the Linux Foundation and brings together AT&T, China Mobile, Huawei and ZTE. Iâ&#x20AC;&#x2122;ve said it before and Iâ&#x20AC;&#x2122;ll say it again: every time I list those four names as the major collaborators in a global telecoms project I want to paste it on the gateposts of the White House. This is an integrated industry and this is something to be proud of. But back to O-RAN, which has a diverse range of vendor members. Thereâ&#x20AC;&#x2122;s Ciena, Cisco, Ericsson, Intel, Nokia and Qualcomm, representing Scandinavia and the US; thereâ&#x20AC;&#x2122;s Fujitsu, NEC and Samsung from east Asia; and also AsiaInfo, Boelink, CICT, Lenovo and ZTE â&#x20AC;&#x201C; all from China. Not Huawei, for some reason. The Alliance says that thanks to its work â&#x20AC;&#x153;an ecosystem of innovative new products is already emerging that will form the underpinnings of the multi-vendor, interoperable, autonomous, RAN, envisioned by many in the past, but only now enabled by the global industry-wide vision, commitment and leadership of O-RAN Alliance members and contributorsâ&#x20AC;?.
What difference will it make? Ideally you should in the future be able to buy RAN elements then plug them into your base station or small cell. They should fit together and work. Just like buying a light-bulb or phone charger and not worrying about connectors. A UK-based market analysis firm Rethink Research says 5G â&#x20AC;&#x153;will change the shape of the cellular industry foreverâ&#x20AC;? and, while the traditional vendors are â&#x20AC;&#x153;mostly hoping to take a traditional and proprietary approachâ&#x20AC;?, operators are â&#x20AC;&#x153;insisting that they break up the RAN into separate open functions, where every vendor offering can interoperate with every other productâ&#x20AC;?. In a report summary on open RAN, Caroline Gabriel of Rethink writes: â&#x20AC;&#x153;Operators hope that 5G will support an open, multivendor network with an enlarged supply chain and greater price competition and open innovation. This may always have been a goal, but it has not been easily achievable before. Indeed, in the 4G era, the supply chain has contracted considerably because of the consolidation of suppliers.â&#x20AC;? Rethink talked to 76 tier-one operators about their plans for now until 2025. It believes the deployment cost of a 5G macro cell â&#x20AC;&#x153;will fall by 50% from now until 2022 if it is built around an open architectureâ&#x20AC;?. The price of proprietary cells will still fall â&#x20AC;&#x201C; but by 30%, not 50%. Do also watch what the Facebook-backed Telecoms Infra Project (TIP) is doing. It wants to enable the industry to build RAN solutions â&#x20AC;&#x153;based on a general-purpose vendor-neutral hardware and softwaredefined technologyâ&#x20AC;?, says TIP. â&#x20AC;&#x153;Vendor-neutral hardwareâ&#x20AC;? means the sort of off-the-shelf computing kit that runs everything from cash machines and Microsoft Office to MRI scanners and nuclear submarines. Why is the telecoms industry so exceptional that vendors need to build their own hardware? The answer is that it isnâ&#x20AC;&#x2122;t. june/july 2019
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'(876&+( 7(/(.20 */2%$/ &$55,(5 &211(&7,1* 7+( :25/' )25 <28 At Deutsche Telekom Global Carrier, we are reinventing wholesale. To prepare our clients for the challenges of a fast-evolving telecom market. One that will see the rapid growth of future technologies needing cuttingHGJH DZ/DZ FRQQHFWLYLW\ 6R ZH·YH H[SDQGHG RXU SRUWIROLR DQG LQLWLDWHG VWUDWHJLHV WR DFFHOHUDWH LQQRYDWLRQ DJLOLW\ DQG WUDQVSDUHQF\ 1RZ WUXH VHDPOHVV JOREDO FRQQHFWLYLW\ YLD RQH VXSSOLHU LV D SURÃ&#x20AC;WDEOH UHDOLW\ :LWK Deutsche Telekom Global Carrier. Get in touch: globalcarrier.telekom.com