LEVEL 3: Builds a second Sydney POP NBN: Competitors still concerned by Telstra plan SMARTPHONES: Telstra CTO plots the future
TELCO TOGETHER The Hips and the Hummers rock the Randwick Labour Club for a good cause
COMMUNICATIONS DAY 17 JUNE 2013
What’s happening today in telecom business, policy & technology
ISSUE 4461
Senate committee clears way for TIO reforms A Senate communications committee has recommended legislation that could lead to periodic independent public reviews of the Telecommunications Industry Ombudsman scheme. The bill would also require the TIO scheme to comply with standards determined by the communications minister, despite objections being raised by iiNet. The Telecommunications Legislation Amendment (Consumer Protection) Bill 2013 was referred to the Senate Environment and Communications Legislation Committee in March. According to the explanatory notes, it aims to strengthen consumer protections and improve the telecommunications coregulatory framework. As well as the TIO-related amendments, the bill would alter the Telecommunications Act so that industry codes could be varied rather than having to be wholly replaced; and require code developers to publish draft codes, draft code variations and related public submissions. The bill also relates to the Do Not Call Register Act, which would be amended to clarify which party is responsible for making telemarketing calls and sending marketing faxes where third parties are carrying out the marketing activities. According to the committee's final report, under proposed changes in the bill the first review of the TIO scheme would be completed within three years, with five-yearly reviews thereafter. The reviews would be conducted by an independent person or body and would provide for consultation with the public, as well as the TIO and the Australian Communications and Media Authority. The TIO would be required to respond to any review recommendations within six months of receiving a report. An amendment that could see the minister given more powers was more controversial. Under the amendments, the TIO would be required to comply with standards determined by the minister, following consultation with the TIO and the ACMA. However, as detailed in the report a submission from iiNet had questioned the lack of industry consultation required should the minister make a determination in relation to the TIO. iiNet argued that, given that the TIO scheme is funded by industry, and a TIO determination has the potential to have onerous administrative and financial impacts on industry, it would be reasonable and appropriate for the minister to be required to consult with industry before making a TIO determination. The carrier suggested that the bill include a mandatory requirement for the minister to have regard to the financial and administrative burden on participants in the Australian telecommunications industry. However, the report also provided input from the Department of Broadband, Communications and the Digital Economy in support of the proposed amendments. It suggested that it will enable the minister to establish framework principles to underpin the TIO's operations which are both consistent with best practice for other external dispute resolution schemes and relevant to the telecommunications industry. DBCDE had also advised that, in developing the amendments to reform the TIO scheme, it had consulted broadly with industry and consumer groups, including the Communications Alliance and ACCAN, which had supported the proposed amendments. The report also noted that most of the other submissions to its enquiry were largely supportive of the reforms to the TIO scheme. It pointed out that Vodafone had acknowledged the fundamental role of the TIO in providing an alternative dispute resolution scheme for consumers and industry. “Vodafone stated that it was 'largely comfortable' with the proposed amendments to the TIO scheme. It believed that the
changes will 'help to further clarify the TIO's role and the standards by which it should operate',” the report stated. GREENS SUBMISSION: The senate report also commented on an amendment to the bill in the House of Representatives put forward by Greens MP Adam Bandt. He had called for an amendment to the Telecommunications Act to provide that a carrier licence held by Telstra would be subject to the condition that any work undertaken by Telstra or its subsidiaries to produce a Telstra directory must be undertaken in Australia. It followed reports that Telstra's Sensis division would outsource work to India. However, the committee noted in its report that it had received no evidence on the amendments to the bill proposed by Bandt. They said that in the committee's view, the Bandt amendments were inconsistent with the scheme of the bill under review. Geoff Long
Level 3 reveals second Sydney POP in Asian enterprise push Level 3 has set up a second point-of-presence in Sydney as part of a region-wide infrastructure refresh aimed at growing its enterprise networking business in Asia Pacific. Level 3 chief marketing officer Anthony Christie (pictured) told CommsDay that the operator is in the progress of upgrading its 11 Asian POPs. Tier one markets, including Japan, Hong Kong, Singapore, and Australia, will be upgraded with 10Gbps network interface support, while tier two markets will be upgraded to support 1Gbps customer access, Christie said. As part of that upgrade, Level 3 APAC sales VP Ricky Chau said the operator has set up a second POP in Sydney. The new site, launched three weeks ago, is located in one of Equinix’s Sydney facilities, and complements Level 3’s existing POP inside an Optus facility. At this point, Level 3 does not have staff in Australia but supports a broad portfolio of services, including IP-VPN, Ethernet, and internet services, through local contractors, Chau said. He added that Level 3 is fully licensed to offer telecoms services in Australia and is prepared to set up shop should customer demand warrant investment in the future. The aim of the infrastructure upgrade, Christie continued, is to bring “the entire suite of enterprise services across our Asian infrastructure.” Level 3’s products will include managed IP, managed VPN, managed security, content distribution network services, and conferencing and collaborations. “It will be the
Telco industry rocks for a cause
Australian telecom industry professionals gathered at the Randwick Labor Club on Saturday night to contribute to the Telco Together Foundation. Featured entertainment was the Hips featuring Verizon’s Paul McCann and the Hummers’ featuring Comms Alliance’s John Stanton. Former CommsDay editor Luke Coleman also made an appearance, channelling one Freddie Mercury for a rendition of “Tie Your Mother Down”
COMMUNICATIONS DAY 17 June 2013 Page 2
same set of services that we provide in the US and other regions such as Latin America and Europe.” According to Christie, Level 3 is implementing a strategy to provide a seamless global experience for customers. Through the establishment of a global account management team, the idea is to remove the concept of so-called “B-end” customer support. B-end typically refers to in-region circuits that support global contracts signed in other regions. Asian circuits are often considered B-end support for the global networks of US and European multinationals. “I don’t want to be in front of a customer in Europe and say I can provide them with B-end support in Asia – I don’t think any customer want to be ‘B’ in anything,” said Christie. “We go to customers with a service model, a designated global team… we are not treating any service for customers as ‘B-end’.” FUTURE DATACENTRE PLAY? One area that Level 3 lacks in Asia Pacific is cloud computing infrastructure. While the company offers cloud-based services such as conferencing and CDN, it currently lacks a data centre play in the region. “But if you look at our global product strategy, then you can assume that we will bring services that we have in other regions to Asia. We are a leading data centre and cloud player in Latin America with a burgeoning presence in Europe. We are in the planning process to set up similar capabilities in North America this year,” Christie said. “We will be offering the same services in Asia, probably not this year, but definitely some time in the future.” Tony Chan
Telstra NBN plan attracts ire from competitors Telstra's revised draft measures for ensuring its retail business units don't gain an unfair advantage in the migration to the NBN have failed to placate rival carriers, with AAPT, iiNet, Macquarie Telecom and Optus all objecting to the latest draft. The resubmitted Information Security Plan has also failed to appease NBN Co, which warned that “any inappropriate restriction in the scope of the NBN ISP may have unforeseen consequences for the industry, including NBN Co, in the future.” While the bulk of the migration plan was approved by the Australian Competition and Consumer Commission in February last year, the NBN Information Security Plan is one of a number of required measures that are still to be signed off. Telstra's draft NBN Information Security Plan was initially knocked back by the ACCC earlier this year, when it directed the carrier to re-submit a varied ISP taking into account its concerns. Its revised plan was submitted in April, with Telstra supporting documents noting that it considers that the changes made constitute “a substantial and direct response to the various issues raised by the ACCC, NBN Co and industry”. It also claimed that the changes go beyond what was contemplated by the final migration plan. While rival carriers welcomed many of the changes, they argued that in some instances they don't go far enough in preventing Telstra from gaining a commercial advantage. And as Macquarie Telecom pointed out, given that the NBN has already been delayed, the ACCC should take the time to ensure that the migration process is agreed upon by all parties. “The NBN ISP must therefore contain measures which are adequately robust and unambiguous, to serve its intended purpose and to facilitate the development of a level playing field during the potentially extremely protracted transition to an NBN environment,” Macqarie said. In its submission, AAPT said it does not consider that the resubmitted NBN ISP will meet the objectives set out in Schedule 6 of the migration plan. “In particular, AAPT does not consider that the resubmitted NBN ISP will sufficiently prevent Telstra from using or disclosing NBN Co Migration Information to gain or exploit an unfair commercial advantage over Telstra’s Wholesale Customers,” it stated. In an earlier submission Optus had highlighted what it considered the inadequacy of information security controls that could have enabled Telstra’s retail business units to access information and the narrow scope of the NBN Co migration information protected under the ISP. It said it still had similar concerns in the revised draft. “It appears that Telstra has tried to address industry concerns in its revised NBN ISP by extending the scope of protected migration information to include Points of Interconnect and by the introduction of “Permitted Purpose” test relating to the use and disclosure of the NBN Co Migration Information. Whilst
COMMUNICATIONS DAY 17 June 2013 Page 3
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these changes are welcome, Optus considers that the changes fall short of providing the industry with sufficient comfort regarding appropriate use and disclosure of NBN Co Migration information by Telstra,” Optus stated. A similar point was raised by iiNet in its submission prepared by law firm Herbert Geer. It noted that the revised draft from Telstra had widened the restrictions on access to information by its staff and those of its subsidiaries, but suggested that the restrictions were lacking in detail. “While this general commitment by Telstra is welcome, iiNet is concerned that there is no detail as to how compliance with this general commitment will be implemented, enforced and reported on. iiNet submits that without this detail, this general commitment is of little value and is not capable of satisfactorily addressing the migration information concern. Meanwhile, NBN Co has suggested that it should not be for Telstra to decide whether certain information provides it with a commercial advantage. The network builder said that once the information is considered to be NBN Co Migration Information, the controls in the ISP should operate to protect that information from all unauthorised disclosures. The ACCC said it is currently considering the submissions it has received but has not yet set a timeframe for a decision. Geoff Long
Digital Realty: fix datacentre disconnect for big opex savings Global datacentre provider Digital Realty has highlighted large potential opex savings and corporate social responsibility gains for some Australian datacentre operators – if they can address a glaring disconnect in the way they measure and plan around power usage. According to surveys commissioned this year by the firm from Campos Research and Analaysis, polling some 100 Australian IT datacentre decision makers at large companies (annual revenues of at least US$500 million and/or at least 500 employees), 39% of participating datacentre operators were not measuring power use at all. 13% did not know their own power usage effectiveness, and 5% weren’t even aware of what the term PUE referred to. But at the same time, almost 90% of participants who said they’d expand their datacentres this year also said they were ‘extremely’ or ‘very confident’ about complying with future regulations on power use and carbon emissions. “These figures suggest a disconnect in some areas of the Australian data centre industry,” said Digital Realty’s APAC SVP Kris Kumar. “Close to 40% of respondents not measuring the power consumption of their data centres and yet 90% of them feeling confident about complying with regulations suggests there is a gap that needs to be closed and an opportunity for the industry to take a more proactive approach to monitoring energy use.” “At an operational level, properly monitoring and managing energy use within a data centre environment can significantly reduce operational expenditure and support an organization’s corporate social responsibility objectives,” he added. “[And] it’s certainly no secret that energy costs are a significant cost factor for data centre users so a focus on energy efficiency and a clear visibility of usage is critical.” There are government regulations in the offing to help organisations attain an energy rating for their datacentres, such as the New South Wales government’s NABERS rating system – in effect since February this year, with Digital Realty itself part of a group advising the state government on NABERS-rated facilities. But, as the firm’s Australian head of sales engineering Damien Spillane warns, not every organisation has the capability to monitor datacentre energy use at a sufficiently granular level, and putting that capability in place may not be a simple matter – especially on older hardware. “Taking the datacentre down – demobilising what is often a mission-critical facility – to install metering, there’s always a reason not to do it,” he remarked. “And in terms of legacy power distribution, you could retrofit meters to it, but often… it’s just not worth it… repairing electrical infrastructure is often, again, a difficult pill to swallow.” That suggests that operators looking to cut opex by tightening up their datacentre power monitoring should either be factoring it into consideration for their next infrastructure refresh, or contemplating outsourcing at least some of their datacentre operations into a third party site with more newer, efficient gear
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and better measuring capabilities. The resulting opex and carbon savings, though, could be substantial. “Older facilities, typically, will have higher PUEs… legacy datacentres will typically be upwards of 2,” noted Spillane. “Aside from the fact that the infrastructure in a newer facility will be intrinsically more efficient [because of] higher densities, virtualisation and other technology-oriented advantages, the actual PUE will show significant improvement; we’re targeting PUEs of less than 1.3.” The power savings, he added, could be upwards of 35% – with the absolute cost reduction only improving with the increasing cost of power. Petroc Wilton
Victoria matches ICT service suppliers with startups A new architecture for developing mobile applications and sound recognition software for use in security monitoring were two of the successful ideas to be rewarded with technology development vouchers worth up to $50,000 by the Victorian state government. Victorian technology minister Gordon Rich-Phillips announced eight companies that have been awarded grants as part of the $8 million Technology Voucher Program. The funding allows the companies to collaborate with suppliers in order to develop, adapt or adopt new products and processes using industrial biotechnology, small technologies or ICT. “This is a responsive funding model to drive the use of cutting-edge technologies, enabling Victoria’s companies to compete in today’s global economy,” Rich-Phillips said. “The vouchers will help innovative companies to connect with high-tech service providers and absorb new technologies to improve their productivity and competitiveness,” he added. The architecture for developing mobile applications was proposed by Evado eClincial in conjunction with Logical Tech Digital, while the sound recognition for security came from UoM Commercial with Planet Innovation. The minister said applications for the development vouchers would remain open to ensure companies could utilise the program at a time that suited them. As part of the programme, the state government has also established a searchable directory of technology capabilities and suppliers, listing companies and organisations that can provide services to voucher applicants. The directory includes more than 180 suppliers. Geoff Long
Telstra CTO forecasts the smartphone future The mobile handset in 2020 will contain on it everything you have in your wallet – including your keys, according to Telstra CTO Hugh Bradlow. Bradlow made a number of forecasts as to how the mobile device will look like and operate in the future, with innovation set to drive a number of changes. He predicted that smartphones will begin to work in conjunction with other screens, including “your watch (think Pebble Watch), your glasses (think Google Glass), your TV set, your PC screen… in fact, any screen that happens to be near and convenient.” “The use of the microphone will also continue to rise. We are already seeing a rapid migration in people using the microphone, think of applications such as Siri and Google Now. These technologies will continue to get more sophisticated and a part of our everyday lives. Your phone will also provide your context – where you are, how fast you are moving, where you need to go, who you are talking to, and useful information about the environment,” he added. In order for this to work successfully, Bradlow said that Telstra will be using new battery technologies and power management solutions “to help devices get through a day without recharge.” David Edwards
Optus joins France Telecom, Deutsche Telecom in wireless revenues slide: Deutsche Bank Optus is one of three major global telcos to report a wireless service revenue decline in the March 2013 quarter, according to a new Deutsche Bank report.
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The report found that while mobile data now accounts for 33-53% of wireless service revenue for most global telco companies, the rate of wireless service revenue growth slowed across most major global carriers during the quarter. Moreover, France Telecom suffered a 7% decline, with Optus down 5.4% and Deutsche Telecom falling 1.9% in the three-month period. Optus managed a 1.1% increase in wireless subscribers during the March 2013 quarter, which put it in the mid-range compared to global peers; however, SingTel achieved a 6.3% increase. Verizon achieved a 6.4% increase in wireless subscribers, while AT&T and Deutsche Telekom grew 3.2% and 3% a piece. In the PSTN business, SingTel recorded an “impressive” decline of just 1.2%, with other carriers ranging from -4.8% to -11.5% declines in the March 2013 quarter. Deutsche Bank added that Telstra had suffered a 10.8% decline in PSTN revenues in the December 12 half due to 4.8% retail line loss and lower ARPU and usage; however, it did not have Telstra’s figures for the March 2013 quarter. Fixed broadband growth was largely positive across the board, with France Telecom at 3% SingTel (Singapore) at 2.2%, Deutsche Telekom at 1.6% and Verizon at 1.4%. And while Deutsche Bank did not have current figures for Telstra, it added that the firm’s “renewed focus on customer acquisition through attractive bundled offers, increased data allowances, unique content and products such as T-Box & THub [saw Telstra report] the strongest broadband subscriber growth of 7.2% in the Dec 12 half compared to global peers in the Mar 13 quarter.” “The outlook commentary from major global telecom companies highlights that the weakness in wireline business is expected to continue to offset wireless growth, resulting in a low growth environment,” Deutsche Bank concluded. David Edwards
Verizon’s Private IP now available from Equinix IBXs Verizon will offer its Private IP networking service out of Equinix’s International Business Exchanges data centres located around the world. According to Verizon, the new service offering is “necessary because the rapid growth of cloud computing and software-as-a-service applications drive demand for data centre services.” “Whether it is e-commerce applications, big data, media and entertainment or cloud computing, enterprises need to quickly and securely access and move information from various points around the world,” said Verizon enterprise solution president John Stratton. In addition to being a separately managed IP network, Verizon’s Private IP solution also provides endto-end quality of service, and supports dynamic scaling of capacity up to 100G to meet changing traffic demands. Tony Chan
MELBOURNE NET FIRM LOOKS WEST Melbourne Internet firm Web Marketing Experts has opened an office in Perth, the third for the company in Australia and sixth globally. The company cited the strong takeup of digital services in Western Australia as the reason for the expansion. Web Marketing Experts started in Melbourne in 2008 and has since moved into providing support services, social media consulting and mobile application development through its AppsCore business. It now has more than 60 staff in Australia and 150 globally with offices in Los Angeles, Dubai and Singapore. VIRGIN MOBILE TO SPONSOR SPLENDOUR IN THE GRASS FESTIVAL Virgin Mobile has announced it will sponsor music festival Splendour in the Grass for the fourth time. The telco will award eight fans with a ‘Splendour experience’ for them and a friend via a Facebook promotion; it will offer customers a host of VIP benefits at the festival, including phone charging facilities, “spin the wheel” prizes and access to a “chill out” area. Customers can register for the benefits by texting the word ‘Splendour’ to 226.
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