Capacity Magazine February / March 2019 by Capacity Media

XX ISSUE XX MONTH 2014 2019 VOL VOL 19 ISSUE 2 FEBRUARY/MARCH

Business intelligence for the global carrier industry

Capacity

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Enabling Communication

WORLDWIDE

Germany 2,400 towers Spain 10,900 towers

Peru 900 towers

Brazil 1,750 towers

Chile 400 towers Argentina 350 towers

Capacity

CABLE Presence in

TOWERS More than 16,700 telecommunications towers

21 countries 52 cities Tier 1

Leaders

international network

in 3 of the 6 markets where we are present

87,000 km of fiber optic cables

One of the largest 88 PoPs, 21 fully owned

internet backbone networks

DAS and Small Cells: the best connectivity solutions

landing stations

More than 300 nodes

20 Tbps of IP Capacity

2 redundant NOCs

Reaching 100%

with state of the art technology

of national operators We operate the largest submarine cable of Latin America, the SAm-1

MAREA and BRUSA:

We own the most competitive

the highest capacity cables of the world Direct access to the most relevant data centers in the world

telxius.com

Strategically located sites according to the operators' needs

tower catalogue in Spain

VOL 19 ISSUE 2 FEBRUARY/MARCH 2019

Big interview Dave Temkin explains why Netflix wonâ&#x20AC;&#x2122;t be entering the infrastructure game Feature Capacity looks at the impact mobile gaming and OTT services will have on the wholesale industry

Business intelligence for the global carrier industry

Gaming to gobble

bandwidth Capacity

capacitymedia.com

Capacity

| 01

CONTENTS Capacity magazine, February/March 2019

VOL 19 ISSUE 2 FEBRUARY/MARCH 2019

Big interview Dave Temkin explains why Netflix won’t be entering the infrastructure game Feature Capacity looks at the impact mobile gaming and OTT services will have on the wholesale industry

NEWS & ANALYSIS

FEATURES

04 MIDDLE EAST

30 CAN YOU BUILD A GREAT WALL ROUND CHINESE VENDORS?

Business intelligence for the global carrier industry

Cover image: Adrian Teal, CartoonStock

Gaming to gobble

08 LATIN AMERICA

bandwidth

Messaging and SMS Global Awards results

14 NORTH AMERICA

WILL REVOLUTIONISE MOBILE GAMING

A smart path to urban happiness

15 SUBSEA AMERICAS

PEOPLE & DIARY

5G – still a long way to go

16 NORTH AFRICA

78 APPOINTMENTS

ANALYSIS

The industry’s latest movers

Big interview: Nader Zein, mWT ISG

18 AFRICA

79 A DAY IN THE LIFE

Big interview: Gergely Vadas, Deutsche Telekom Global Carrier

Big interview: David Hutton, GSMA Technology

Ten leading 5G projects

10 SUBSEA IN LATAM

34 EDGE COMPUTING

ANALYSIS

Vinay Nagpal, president, InterGlobix

capacitymedia.com

20 EUROPE

ON THE COVER

23 O2 OUTAGE ANALYSIS

Gaming is one of the fastest growing markets for bandwidth consumption - Capacity looks at this burgeoning sector (page 34)

MOBILE & IOT SPECIAL REPORT after page 44

80 THE INNOVATION REPORT

26 ASIA STRATEGIES

SPONSORS Capacity64 RETELIT

25 EXECUTIVE INTERVIEW Alexandre Pébereau, founder and CEO, Tofane Global

ENTERPRISE & WAN SPECIAL REPORT

27 EXECUTIVE INTERVIEW

after page 62

Andrew Kwok, CEO, HGC

36 THE BIG INTERVIEW Dave Temkin, vice president ǡ ƪ

40 THE BIG INTERVIEW

Riccardo Delleani, CEO, Sparkle

THE BIG INTERVIEW pages 36-37 Dave Temkin, vice president ƪ ǡ the company’s leadership in the market and why it won’t invest in infrastructure

42 THE BIG INTERVIEW Sumeet Walia, head of enterprise and carrier services, Tata Communications

THE BIG INTERVIEW pages 42-43 Sumeet Walia, head of enterprise and carrier services at Tata Communications, talks to Capacity about how he’s moving the business forward

65 66

Aryaka case study

Meeting enterprise needs

70 72

Ten projects to watch

Big interview: Jean Critcher, Orange Business Services

Market trends

Partner with the UK’s largest Ethernet Network

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

Find out more talktalkbusiness.co.uk/carrier

Capacity

editor’s letter | 03

New focus for the industry as it prepares for 5G W ith a new year comes a new focus for the industry as it looks forward to all of the major events, announcements and developments that will no doubt come in 2019. Our February/March issue contains two bumper special reports on topics that have a big impact on wholesale: Mobile and IoT; and Enterprise. A key driver in demand for more connectivity is over-the-top (OTT) content, be it video or gaming. That’s why we’ve seen a number of OTT players, from Facebook to Google, buying or building more infrastructure. Netflix uses 15% of the world’s internet bandwidth but, perhaps surprisingly, it does not have plans to follow suit. Find out why on page 36. Netflix has hinted at a move into OTT gaming. Gaming is one of the fastest growing markets for bandwidth consumption: our cover feature takes a snapshot of the burgeoning market and delves into the power of edge computing – see page 34. This will be the year of 5G, with deployments already underway in a number of markets. We have an interview with GSMA head of networks David Hutton and his team, who break down some of the challenges the industry is facing with 5G deployments now ramping up – page 58. Deutsche Telekom Global Carriers’ Gergely Vadas tells us about its roaming and IPX strategy on page 56. Key to 5G and other technology is standards, and Madar Zain of ETSI (page 54) gave us a technical look behind 5G. There is a power listing of key 5G projects from across the globe on page 60. And check out our feature on how the carrier market is preparing (page 50). Our other special report is on enterprise networks, which are moving more towards softwaredefined models. The SD-WAN market has seen around 500% growth in the last two years, driven by increasing demand from enterprises looking for more flexible networking solutions. Orange Business Services’ Jean Critcher tells Capacity about Orange’s recent deployments (page 66). Aryaka, an SD-WAN vendor,Capacity highlighting the actual benefits enterprises see from SD-WAN (page 65), and on page 68 we take a look at why more carriers are offering this exciting new technology. This issue will not only feature at Mobile World Congress, but also at a number of our own key events. We’ll be at Capacity Latam, so check out our analysis of the subsea cable market in that region (page 10). We’ll also be at Capacity India and Middle East, so we sat down with Tata Communications’ head in those regions to find out more about what they are doing in the market (page 42). Sparkle’s new CEO Riccardo Delleani tells us of his plans for the Italian carrier (page 40). And don’t forget to check out our market trends, supplied by Vodafone, which looks at the enterprise sector (page 72). Enjoy, and we’ll see you at an event soon.

Follow Capacity on Twitter: @capacitymedia

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

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

Management CEO Ros Irving ros.irving@capacitymedia.com Editorial Editor-in-chief Jason McGee-Abe jason.mcgee-abe@capacitymedia. com Twitter: @JasonMcGeeAbe Editor-at-large Alan Burkitt-Gray alan.burkitt@capacitymedia.com Skype: alanbg Twitter: @alanburkittgray Deputy editor James Pearce james.pearce@capacitymedia.com Twitter: @jamespearce87 Reporter Natalie Bannerman natalie.bannerman@capacitymedia. com Twitter: @nitnat1989

Sales International sales manager Federico Mancini federico.mancini@capacitymedia.com International sales manager Charles Newman charles.newman@capacitymedia.com Design Freelance designer Barbara Donner Graphic designer Samantha Heasmer samantha.heasmer@capacitymedia. com

Events Product director, conferences Vanessa Barbé vanessa.barbe@capacitymedia.com ITW event director Ross Webster ross.webster@capacitymedia.com Accounts Administrative assistant Ruby Ward ruby.ward@capacitymedia.com Marketing Head of marketing Lubtcho Dimitrov lubtcho.dimitrov@capacitymedia.com

Subscription enquiries Customer services customerservices@euromoneyplc. com tel +44 20 7779 8610 fax +44 20 7779 8602 Printer Stephens and George, UK Next issue April/May 2019 Published on 1 April 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 Freelance writers Gareth Willmer Guy Matthews

How to contact Capacity Capacity magazine is published by Telcap, a division of Euromoney Global Limited TelCap, 8 Bouverie Street London EC4Y 8AX, UK tel +44 20 7779 7227 (switchboard) www.capacitymedia.com Capacity (ISSN 1471-762X) is published six times a year by TelCap. Annual subscription €250, £210, $340. © 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 | middle east

BEZEQ HIT WITH $3M FINE OVER FAILURE TO SELL WHOLESALE TELEPHONY SERVICE Bezeq Israel Telecom has been set a $3 million fine from Israel’s telecoms regulator over a failure to sell wholesale telephony services to rivals. In a notice published at the end of 2018, Bezeq said it had been informed by the Israeli Communications Ministry that it is facing a fine for “breach of provisions in connection with implementation of a wholesale telephony service”. Bezeq said it is “studying” the ruling from the director general of the Ministry of Communications, and will consider filing a petition against it. The regulator claims the company acted to “delay and thwart the wholesale market reform” first announced back in 2015. Regulators reformed Israel’s wholesale market in 2015, ordering Bezeq to open up its telephony infrastructure to competitors. The company appealed against the decision, but was ordered by regulators to begin making wholesale services available by August. “The company is studying the decision and weighing the filing of a petition against it,” said the company in a statement.

Capacity

Bezeq to petition fine issued by the Israeli Communications Ministry

OMANTEL PREPARES FOR IOT IMPLEMENTING GSMA GUIDELINES Omantel has implemented a set of best practices for the secure design, development and deployment of internet of things services under the GSMA IoT Security Guidelines. “Having deep and full understanding of challenges related to security of the IoT as well as issues that arise from unregulated and unstandardised approaches to security problems, Omantel has decided to embrace and follow the guidelines, controls and best practices for securing

IoT developed by the GSMA,” said Abdullah Al Barwani, general manager of Omantel’s corporate security unit. The news marks Omantel as one of 15 global network operators to adopt those the GSMA best practices. “Having adequate IoT security is absolutely essential for smart cities as such projects must remain secure at all times. The GSMA IoT Security Guidelines focus on how to ensure the security of IoT services in a low cost and low power

consumption manner, which had always been a challenge. Moreover, it helps in having a long-lived security and protecting devices that are physically accessible to the attacker,” added Muhammad Moqeet ur Rab, senior manager of security architecture and operations at Omantel. “Omantel has decided to embrace and follow the guidelines, controls and best practices for securing IoT developed by the GSMA, commented Omantel’s Abdullah Al Barwani.

NEWS IN BRIEF New figures from Synergy Research Group show that the UC collaboration market will grow by 9% in 2019 reaching $45 billion. Satellite operator Intelsat has become the latest member of the GSMA – an association that looks after the interests of the mobile industry worldwide. Vendor revenues for the last four quarters increased by 13% on a

year-on-year basis reaching $125 billion across six key enterprise infrastructure segments. BT has become one of the first international telecoms companies to be granted a domestic telecoms licence for nationwide services in China. Operator and vendor revenues have grown by 32% in 2018 totaling $250 billion.

Alcatel Submarine Networks and Facebook confirm the availability of aluminium conductor cable for fibre-optic subsea cable systems. The volume of data centre merger and acquisition deals grew to $16 billion in 2018. Globalinx Data Centers has completed its diverse fibre cable tie-in with the MAREA and BRUSA cables in Virginia Beach.

february/march 2019

middle east | 05

TELECOM EGYPT IN SUBSEA PARTNERSHIP WITH FORMER CEO OF GBI Telecom Egypt is partnering with a new company, Fiber Misr, for subsea services in Egypt and the region. The companies say that they will cooperate in commercial activities related to submarine cable track inspection services, as well as landing, fixing and maintaining submarine cables. This is in addition to marine project management, cable freight and storage services and logistical support provision. All these services will be provided in the regions of the Mediterranean, the Red Sea, the Gulf and east Africa, they said. Telecom Egypt CEO Ahmed El Beheiry and Fiber Misr CEO Ahmed Mekky signed a memorandum of understanding to work together to modernise telecoms infrastructure in Egypt and outside through joint projects. Mekky is a former CEO of Gulf Bridge International, a company he left in 2015. They signed their agreement in the presence of Egypt’s minister of communications and information technology, Amr Talaat. Mekki said the new partnership will maximise the added value of the two companies.

HGC LINKS WITH EXPRESSO TO SERVE AFRICA AND MIDDLE EAST HGC Global Communications has expanded its services into the Middle East and Africa via a link-up with Dubai-based Expresso. HGC and Expresso will collaborate to extend the comprehensive network and data transmission in Africa and Middle East, said the companies. HGC aims to bring high-volume data transfer to African-based customers. Ravindran Mahalingam, HGC’s senior vice president of international business, said: “We are delighted to collaborate with Expresso, and to accelerate expanding telecom footprint from Africa to worldwide. We believe that through this industry collaboration, we can drive innovation, growth, and wide range of global data transmission solutions for local and regional customers.” Expresso Telecom says it provides a onestop centre for the group’s international operations, including wholesale and carrier relations. Expresso CEO Tarig Hamza Rahamtalla said: “We will leverage each other’s strengths to deliver quality services to our Capacity common customers – existing and future – given the global reach this partnership provides us.” Mahalingam added: “We are delighted

Partnership with Expresso will expand HGC’s footprint into Middle East and Africa

to collaborate with Expresso, and to accelerate expanding telecom footprint from Africa to worldwide.” The companies listed advanced business solutions as including data centre colocation, NNI, MPLS, IPLC, IPX, voice and messaging solutions and big bandwidth solutions.

BATELCO FURTHER STRENGTHENS BGN CAPABILITIES Bahrain’s Batelco has enhanced its Gulf network by adding a new protected route over the network. The Batelco Gulf Network (BGN), which launched in 2018, runs over a state-of-the-art optical transport network (OTN) and meets the demand for reliable high bandwidth connectivity and capacity serving the different needs of

global services and customers supporting up to 8.8Tbps of capacity providing connectivity to all GCC countries. As a result of the enhanced investments in the network, Batelco’s customers can opt for protected solutions using the new protected route, achieving more resiliency and ensuring higher uptimes and redundancy.

The BGN is now more robust to mitigate the risk of cable cuts and outages, which can effect customers’ core operations in addition to providing a unique value through interconnectivity with other regional and global terrestrial and submarine cable systems, thus introducing a fully protected ring on both terrestrial and submarine routes.

LINX AND STC PARTNER TO LAUNCH JEDDAH INTERNET EXCHANGE

STC to turn JED-IX into the leading internet and data hub in the region

capacitymedia.com

The London Internet Exchange (LINX) and Saudi Telecom Company have announced a strategic partnership that will see the launch of a new internet exchange in Jeddah, Saudi Arabia. The two firms will work together to launch JED-IX after striking a deal in December. The internet exchange will serve as a neutral internet traffic exchange platform interconnecting global networks in the GCC region. Alan Whelan, VP of STC Wholesale, said: “STC’s ambition is to develop JEDIX into the leading internet and data

hub in the Middle East and North Africa region. In LINX we have a global leading IX partner who will help accelerate the delivery of this ambition and create a thriving interconnection eco system in the Kingdom.” LINX will offer its expertise as one of the world’s largest internet exchanges to support the operation of JED-IX. In addition, it offers services to network operators and content providers in the Gulf from a fully redundant switching platform located in an STC data centre in Jeddah.

06 | middle east

ETISALAT NAMED AS FIRST MIDDLE EAST BRAND WORTH MORE THAN $10BN Etisalat has been named as the first Middle East group to have a brand portfolio worth more than $10 billion. Awarded by Brand Finance, a global independent branded business valuation and strategy consultancy, the recognition takes into account the company’s portfolio of brands such as Etisalat Misr, Mobily, Ufone, Maroc Telecom, PTCL and Etisalat Afghanistan. The ranking was also supported by the fact that the company has experienced 8% in growth since last year.

“We are proud to achieve the recognition as the most valuable portfolio brand and the first Middle Eastern brand to break the $10 billion barrier in terms of wider portfolio value in the MENA region. This achievement is also due to our continuous efforts in digital transformation whereby we have amplified our reach and presence in a highly competitive marketplace by investing in new digital platforms and global brand building initiatives,” said Saleh Abdullah Al Abdooli, CEO, Etisalat Group.

GROWTH IN DATA SERVICES TO DRIVE TELECOM REVENUES IN MENA New data from ResearchAndMarkets find that telecoms revenue in the region will increase driven by spending on data services. “Telecoms revenue will increase because growth in spending on data services will offset the effects of increasing competition and market saturation,” it stated in its Middle East and North Africa Telecoms Market: Trends and Forecasts 2018-2023 report. The report predicts that there will be moderate growth in telecom services revenue in the Middle East and North

Africa (MENA). Demand will be levelled by market saturation, challenging socioeconomic conditions and fierce competition. Other key findings include the prediction that the IoT market will make just over $6 billion in revenue by 2023 supported by strong growth in the number Capacity of M2M connections. The growing uptake in 4G/LTE services and the launch of 5G mobile services in 2019 will contribute to traffic growth and will reduce the overall decline in average revenue per user.

STC AND ZAIN WIN MOBILE SPECTRUM LICENCES IN SAUDI ARABIA

STC and Zain buy spectrum to expand mobile services

audi Telecom Company (STC) and Zain have been awarded spectrum licences by the Saudi Communications and Information Technology

Commission (CITC) in the 2,300MHz and 2,600MHz band. STC confirmed that it had won the auction in the 2,300MHz frequency band, receiving a 15-year licence starting from January 1 2020 to December 31 2034. The company will pay $95.9 million (SAR 360 million) in equal instalments for the licence and have confirmed that it is to be financed internally by the company, not affecting its financial results. In addition, Zain has said that it won a licence for the 2,600MHz band, which it will use to expand its 4G+ services adding to its existing 800, 900, 1,800, 2,100 and 2,600MHz band. CITC said that the auction increases the amount of spectrum designated for mobile services in the region from 420MHz to 710MHz, an increase of roughly 70%. The news supports STC’s strategy to develop its networks in the region and contributes to its Saudi Vision 2030, to make Saudi a key telecoms hub.

Success is due to work in digital transformation, says Al Abdooli

THE UAE AND SAUDI ARABIA TO DEVELOP JOINT CRYPTOCURRENCY The executive committee of the SaudiEmirati Coordination Council, the joint Saudi-Emirati council, agreed to developing seven initiatives at its first meeting in Abu Dhabi. One of the seven initiatives which includes economic, social and military integration between the two countries is to launch a cryptocurrency The cross-country digital currency will be specifically made for banks and tested during an experimental phase. The goal of creating the new currency is to better understand the implications of blockchain technology and encouraging more crossborder payments. The project will also determine the impact of a central currency on monetary policies. The committee is headed by Mohammad bin Abdullah Al Gergawi, Minister of Cabinet Affairs and The Future, from the UAE side, and Mohammed bin Mazyad Altwaijri, Minister of Economy and Planning, from the Saudi side.

february/march 2019

Capacity

08 | latin america

SPARKLE LAUNCHES NEW POINT OF PRESENCE IN COLOMBIA Sparkle has expanded its South American backbone with a new point of presence (PoP) in Cartagena, Colombia. The PoP comes in response to growing demand for capacity services in Colombia, delivering local and international network providers, ISPs, content players and OTTs with transport solutions of up to 100GB through Sparkle’s City2City service. By interconnecting with the Pacific Caribbean Cable System (PCCS) and Sam-1 cable, Sparkle will give its customers advanced connectivity solutions from Colombia and other Latin American countries to the US. Combining Sparkle’s terrestrial and submarine networks in the Americas, supported by the Seabras-1 cable, the company says ensures complete redundancy and delivers a top quality data experience for its customers.

Over the coming months Sparkle will continue to expand its presence in Colombia with the opening of a PoP in Bogotá that will enhance the performance

TELXIUS AND AWS TEAM UP ON TRANSATLANTIC MAREA SUBSEA CABLE

Cloud providers are major driver in subsea cable industry, says Arranz

Telxius and Amazon Web Services (AWS) have signed an agreement for the cloud service provider’s use of a fibre pair on the MAREA subsea cable. Telefónica Group’s telecommunications infrastructure company, which manages

an international network of 87,000km Capacity of high capacity fibre-optic subsea cables, announced that AWS had signed an IRU agreement for the use of a fibre pair on its MAREA cable. “We have developed a deep relationship with Amazon Web Services across the geographies we serve and are excited by their long-term commitment with the MAREA submarine system,” said Rafael Arranz, chief operating officer of cable business at Telxius. “As the market pioneer and leader in cloud IaaS for over 10 years, it’s encouraging to see AWS active in the subsea cable market. Cloud providers increased activity in the cable business is now a major driver of the submarine telecom industry.” The company is also working expanding its network and the availability of IP, capacity and colocation services.

of Sparkle’s Tier-1 IP service for ISPs and content providers, called Seabone, with lower latency connections and improved traffic routing capabilities.

LIBERTY LATIN AMERICA CALLS OFF MILLICOM BID Liberty Latin America (LLA) has ended discussions to try to acquire Millicom and agree a deal. In a statement published on its website, LLA said that it has “terminated conversations with Millicom International Cellular SA (Millicom) regarding a potential transaction.” He added that the company is “focused on its growth strategy to deliver value for shareholders and provide market leading products and services to its customers.” Though no official reason has been given for the breakdown in talks between the two, according to sources close to the matter say that communications broke down because LLA was unable win over Millicom’s management with a takeover bid that values the company at $7.6 billion. Millicom’s management were said to be pushing for more.

ASN BEGINS CONSTRUCTION ON ELLALINK CABLE EllaLink and Alcatel Submarine Networks (ASN) have begun construction on the EllaLink Submarine Cable, which will connect Brazil with European hubs. “Together with our financial sponsor Marguerite II and key anchor tenants the EllaLink team has worked alongside ASN to design a high capacity system on the most optimum marine route,” said Alfonso Gajate, chairman of the EllaLink board. “Many people have contributed

towards making this system real, my sincere thanks go to each of them.” The 9300km cable will run from São Paulo and Fortaleza in Brazil to Lisbon, Madrid and Marseille, initially offering 72Tbps of capacity over four fibre pairs. Landing sites in Praia Grande, Fortaleza (Brazil) and Sines (Portugal) have been secured. It will also connect Cape Verde and the Madeira Islands. The cable due to be ready for service in 2020. february/march 2019

International WHOLESALE Services

Connecting your world As a leading global provider of integrated communication solutions, Telefónica provides customers with high quality connectivity, digital platforms and a wide range of innovative, end-to-end solutions. When combined with our extensive international network, cutting edge infrastructure and global footprint, it means we are where you need us to be with the services you expect. Telefónica International Wholesale Services provides services to ﬁxed and mobile operators, service providers, wholesale carriers and OTT-Media companies. With particularly strong presence in Latin America and Europe, our global portfolio includes new digital platforms and solutions for enterprises, as well as more established carrier services: • Voice • Carrier Enterprise • Mobile • Satellite • Security • Cloud • IoT • Big Data wholesale.telefonica.com sales.wholesale@telefonica.com

Capacity

Winner

Best Latin American Wholesale Carrier

Best IPX Service

Telefónica

Telefónica Business Solutions

10 | analysis: subsea in latin america

SUBSEA IN LATAM – THE EAST COAST/WEST COAST DIVIDE

Image: Adobe Stock

he relationship between OTTs and carriers in Latin America (Latam) is “complicated” says Rafael Arranz, chief operating officer of Telxius, likening the connection between the two to a Facebook relationship status. “These guys have a very specific and clear idea of how they want things to be done – they choose their routes based on what’s needed for them at the time,” he added, hinting at a disinterest from the content players over a coastal preference. However, Jorge Porto, director at SubCom, thinks that while there will be an increase of cables in the Pacific, driven largely by the OTTs, “there will be no gold rush” as we have seen in the Atlantic. The age old Atlantic versus Pacific debate was centre stage during the second panel discussion during Capacity’s Subsea Americas event in December 2018, in which Arranz and Porto took part. Simply put: “Brazil is the key driver of the market in the region,” explained Wagner Rapchan, CEO at Netell. “The country has approximately 160 million internet users and all the major Brazilian cities - Sao Paulo, Fortaleza and Rio de Janeiro are located along the east coast.” “At what point does it make sense to continue to build cables in the Atlantic?” questioned Erick Contag, executive chairman of GlobeNet, indicating that new connectivity in the Pacific makes the most sense logically. He did add a caution to the message by saying new routes in all these interesting and new places may look good but in reality it’s a lot more complicated than that. “Looking at things on a 2D map, all these new and different routes make sense, but the geography is very different.” Arranz also aired on the side of caution about the prospects of the replicating the same success across the Atlantic in the Pacific, saying: “Don’t over shoot it” adding that the markets are very different. Rapchan seemed to echo the sentiment, adding: “There is a difference between the east coast and the west coast, not only that the population on the west coast is roughly one third what it is on the east coast – it’s where the population is located. On the west coast most of the population

is concentrated in the south and on the east coast it’s concentrated in the north, Capacity affecting its landing points.” Despite the sparring coasts on the continent, Latin America continues to move full speed ahead with it subsea cable projects. Towards the latter end of 2018, Hemisphere Cable Company (HCC) and NEC announced plans to build a new submarine cable called WASACE 1 connecting Europe to Latin America – across the Atlantic. The 29,000km system will connect Forteleza, the Canary Islands and Seixal with additional branches in Cape Verde, Madeira and Casablanca. In addition, the new system will also include a network operations centre as well as a brand new data centre in the Canary Islands from which additional routes from West Africa, the Mediterranean and North America are also expected. At the top of 2018, SubCom was chosen to build Google’s Curie subsea cable connecting Los Angeles, US, to Valparaiso, Chile, a future win for Latam’s burgeoning west coast. The four fibre-pair system will be the first new cable to land in Chile in close to 20 years, with a RFS date for some time later this year. Also in the works is a planned 3,500km subsea cable along the entire Chilean coastline, to be built by national telecoms company, Gtd Teleductos. The system will land in the cities of Antofagasta, Arica, Iquique, La Serena, Puerto Montt, Talcahuano and Valparaíso. Though very few details of the project have been given

the system has been given a completion date of 2020. On the eastern side, three of the biggest future projects include to go into service include the 9,300km EllaLink cable that runs from São Paulo and Fortaleza in Brazil to Lisbon, Madrid and Marseille. Offering speeds of 72Tbps over four fibre pairs, the system went into construction with Alcatel Submarine Networks in January 2019. Seaborn Networks’ SABR cable will be RFS in the year 2020 connecting Cape Town, South Africa, to Recife, Brazil. The system will interconnect with the company’s Seabras-1 cable in northeast Brazil creating one of shortest, lowest latency routes from Latin America to Africa. SAEx1 is the first phase of the entire SAEx 25,000km, six-fibre-pair, 72Tbps subsea cable connecting Africa and Asia to the Americas. SAEx will land at Fortaleza, Brazil, the islands of Ascension and St Helena and Cape Town, South Africa. It will be RFS in Q1 of 2021. All these systems have the ability to affect the countries where they land, driving greater digital economy and improving the lives of its citizens through increased connectivity. Encouraging further investment to the region regardless of positioning is the key focus and as with all other places, that is a task within itself. “It’s important to understand that you don’t disrupt infrastructure in the same way you disrupt software. Infrastructure is long-term that requires big money upfront,” said GlobeNet’s Contag. february/march 2019

Connecting the Americas

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Evolving to meet eet emands tomorrow’s demands

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In short, we truly make sure our partners artners will always be ready for the future. Find out how you can leverage our infrastructure to expand your reach h across the US and Latin America. Contact us!

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12 | latin america

PHOENIX TOWER INTERNATIONAL ACQUIRES SYSCOM TELECOM TO BOOST SMALL CELL POWER

Dagan Kasavana: Acquisition will help customers with next-gen deployments

ORANGE CHIEF INAUGURATES KANAWA SUBSEA CABLE SYSTEM Orange has officially launched its Kanawa subsea cable system, linking French Guiana with Martinique and Guadeloupe in the Caribbean. The 1,746km fibre cable system is comprised of two pairs of fibre offering transfer rates of around 5Tbps. It utilises wavelength division multiplexing technology and can send up to 100Gbps or 10Tbps, making it one of the most powerful cable systems in the region, according to Orange. Orange Group chairman and CEO Stéphane Richard joined Kourou mayor François Ringuet and Orange French Guiana Antilles director Thierry Kergall in Kourou, French Guiana, for the official inauguration of the new cable system. Richard said: “With its demographic growth and the growth in uses, French Guiana is one of the most dynamic territories for digital technology. We built Kanawa to meet this need for speed and to secure this region’s connection to the global network. This submarine cable, which we are inaugurating today, will connect French Guiana and Martinique and represents an investment of €35 million for Orange.”

Orange serves the growing French Guiana region with new Kanawa cable

Phoenix Tower International (PTI) has acquired Syscom Telecom, adding over 80,000 small cell wireless communication sites to its US portfolio. The US small cell deployment business manages and markets over 80,000 sites for small cell and macro cell deployments with various small cell master agreements in place with wireless operators. Locations include Puerto Rico and the US Virgin Islands, Costa Rica, Panama, El Salvador, Guatemala, Colombia, Peru, Mexico, the Dominican Republic, French West Indies, Jamaica, Argentina and Ecuador. “PTI has been evaluating opportunities

to back a small cell focused team in the United States as a way to help our customers with their next generation deployments,” said Dagan Kasavana, CEO of Phoenix Tower International. PTI has recently made a number of strategic investments across the Americas to support this business plan, including: the acquisition of 1,000km of fibre in Mexico, the investment in Fast Site Solutions in Central America, and the investment in Syscom LatAm in South America. These have allowed PTI to “lead next generation solutions on behalf of our customers with dedicated teams in all markets”, added Kasavana.

TELEFÓNICA SELLS GUATEMALA AND EL SALVADOR UNITS TO AMÉRICA MÓVIL FOR €570M

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Telefónica Centroamérica Inversiones, a subsidiary of Telefónica, has sold its business units in Guatemala and El Salvador to América Móvil for appromimately €570 million. The agreement with Carlos Slim’s América Móvil is for the entire share capital Telefónica Móviles Guatemala

(Telefónica Guatemala) and 99.3% of Telefónica Móviles El Salvador (Telefónica El Salvador). Broken down, the €570 million ($648 million) enterprise valuation of the two business units translates to approximately €293 million for Telefónica Guatemala with the remaining €277 million for Telefónica El Salvador. According to the official statement by Telefónica, these figures are based on 9.7 times the estimated 2018 EBITDA of the two companies. The deal is also expected to generate capital gains before taxes and minorities of approximately €120 million, largely from Telefónica El Salvador.

WINDSTREAM WHOLESALE PICKS TELXIUS FOR INTERNATIONAL CONNECTIVITY Windstream Wholesale has connected its core network to the Telxius-owned MAREA and BRUSA cable landing station in Virginia Beach, offering its customers access to high-speed connections to Europe, Latin America, and the Caribbean. The partnership with Telxius will see Windstream Wholesale set-up a new access point in order to offer its customers with more domestic and international connectivity options. It will leverage the MAREA and BRUSA cable systems, both owned by Telefonica offshoot Telxius, to offer low latency domestic transport services to a number of major US hubs, including Miami, New York, Dallas, and LA. Internationally, the new access point will provide Windstream

Wholesale customers with connections from US locations into Europe, South America and the Caribbean through its collaboration with Telxius.

february/march 2019

Capacity

The largest, sub-sea, multi-ring, fiber-optic network in the Pan-Caribbean region. Providing superior reliability and scalability of wholesale, international-capacity bandwidth services for telecommunications companies and internet services providers over 40 countries. Now, part of Liberty Latin Americaâ&#x20AC;&#x2122;s network covering Chile with VTR and Puerto Rico with Liberty.

14 | north america

NTT COM EXPANDS IP NETWORK WITH TORONTO POP NTT Communications has expanded its Tier-1 global IP network with a new point of presence (PoP) in Toronto. The new PoP will enable the global data and IP services arm of NTT to further scale its offerings to internet service providers (ISPs), contentoriented companies, and cloud, hosting and CDN providers in this highly strategic market. “We are thrilled to extend our footprint into one of North America’s fastest growing technology hubs,” said Michael Wheeler, EVP at NTT America.“Internet-centric businesses and organisations operating in the area will have direct access to our Tier-1 global backbone and the high-performance IP solutions they need for their content, online video, hosting, gaming and other bandwidth-intensive applications.” NTT Com customers will be able to

Toronto: One of North America’s fastest growing technology hubs

connect at numerous capacity levels including 100G ports with confirmed diversity and direct connections to

multiple points in the global IP network to ensure the highest reliability and the lowest latency in the IP services.

CASCADIA FIBERNET TO BUILD NEW VANCOUVER-SEATTLE FIBRE NETWORK Cascadia Gateway and its affiliate Cascadia FiberNet are to build a new 864-strand fibre, carrier-neutral terrestrial network between the Vancouver Harbour Centre and Seattle’s Westin Building Exchange carrier hotels in March. The Cascadia Gateway initiative involves a series of collaborative projects spanning the Cascadia bio-region corridor between Vancouver, British Columbia, and Seattle in Washington. The initiative embraces the concepts put forth under the “Cascadia Innovation Corridor” project being undertaken by various public and private sector organisations. The purpose of the Cascadia Innovation Corridor member companies is to develop

Capacity regional business across the international border between the Province of British Columbia, the State of Washington and Asia-Pacific. “The initiative being undertaken by Cascadia FiberNet is a critical next step forward in meeting the growing capacity demand north and south of the border,” said Michael Boyle, strategic planning director at the Westin Building Exchange. “Building an open cable allows for new entrants to thrive and new opportunities to come to fruition whether it be through enhanced cloud services, support of the burgeoning BC media/visual effects industry, or connecting Canada to the Asia-Pacific capacity coming into North America through Seattle. The

Initiative opens Canada up to extensive opportunities globally, and will greatly benefit the markets of Washington, BC and Asia-Pacific.” Joe Grech, president of AFL Network Services, added: “We’re proud to be the partner of choice to provide construction and engineering services, as well as AFL’s world-class fibre-optic cable and accessories for the Cascadia FiberNet infrastructure project. As a company with offices in both Vancouver and Seattle, we know first-hand the value enhanced communications infrastructure will bring to the Pacific Northwest. We’re excited to be part of the partnership” The ready-for-service projected date is the end of Q1 2020.

DIGITAL REALTY EXPANDS DRIX PLATFORM TO NEW US LOCATIONS Digital Realty has expanded its internet exchange platform to new data centre facilities in Ashburn, Virginia, and Chicago, Illinois. The new locations are in addition to existing Digital Realty Internet Exchange (DRIX) facilities in New York, Dallas, Atlanta and Phoenix, offering connections from various networks in these regions to the peering platform. Digital Realty will use its existing colocation footprint in Virginia, which is one of the world’s largest data centre markets, along with its presence in one of the world’s largest single data centre

buildings in Chicago, to offer internet exchange services, offering solutions from a single cabinet to multi-megawatt deployments. DRIX is Digital Realty’s neutral internet exchange platform offering customers with high-performance internet peering services enabling customers including carriers, CSPs, and digital media firms to exchange IP traffic. The aim of DRIX, according to Digital Realty, is to reduce operating costs whilst boosting network performance, and adding resiliency for its partners. Overall, Digital Realty counts more

than 2,300 firms as its partners across data centres in North America, Europe, Asia, Latin America and Australia. “The explosion of IP traffic has created the need for a highly scalable, reliable and cost-efficient internet exchange solution,” said Digital Realty CTO Chris Sharp. “Our track record as a stable, trusted business partner has enabled us to reduce the complexities of interconnection for our customers, deliver innovative ways to simplify provisioning and improve their network performance for a better enduser experience.” february/march 2019

analysis: subsea americas | 15

SUBSEA PUSHES INNOVATION AND CLOSE COLLABORATION WITH OVER-THE-TOPS

laim your path. This was one of the key overarching messages during Subsea Americas in Florida. The event saw the inaugural launch of Women in Subsea, a new networking initiative chaired by Amy Marks of Xsite Modular and Naaz Bax of Seaborn Networks. The launch session featured panellists Elaine Stafford, managing partner of DRG Undersea Consulting; Rosalind Thomas, managing director and CEO of SAEx International; and Diane Sanzone, vice president of AECOM. Topics included how women can claim their own path and what unique skills they have to offer, overcoming obstacles and what attendees need from their male counterparts in order to succeed in the sector. As the event progressed, talk unsurprisingly turned to OTT/content providers and their influence in the sector. During the content-driven cables session, moderated by Eric Handa of APTelecom, David Crowley, chief technical advisor, Microsoft, said that his focus for the company is on “taking Microsoft to the next level of connectivity as it pertains to cloud and interconnects.” As the conversation progressed, Handa asked fellow panellist Mike Sauer, VP Americas partner and federal, Aqua Comms, about what the company looks for when beginning a new cable project. Sauer was frank in his reply saying: “Without the OTTs involved, quite frankly we don’t build the cable.” Overall, the message from the two is one of co-existence between the OTTs and the operators, not competition. “I don’t feel any tension,” explained Crowley. “At the end of the day we’re not an operator, we’re an investor and we need the best capability for our clients who use our services.” Sauer thinks that the relationship between the two will always work because capacitymedia.com

OTTs have no desire to take up the role of operators echoed his sentiment. “I think with regards to any OTT they want the cost model of being an owner, but they don’t want the responsibility of managing, maintaining and making sure the cable is operational at all times.” The keynote included four industry heavyweights. Paul Scott, senior advisor at C&W Networks; Capacity Larry Schwartz, CEO of Seaborn Networks; Mike Cunningham, CEO of Crosslake Fibre and Steve Scott, CEO of Deep Blue Cable. During the session, the four discussed how to grow Latin America and connect the hubs that exist in the region; the biggest food for thought came from Deep Blue’s Scott who said that OTTs are uninterested in the Caribbean. “It’ll be quite some time for the OTTs to take an interest in the Caribbean. They backhaul to the US so there’s no real incentive there,” he said. As for thoughts on how to grow the region, they all had different ideas on how best to go about it. “By performing as an operating company,” said Schwartz. “And being receptive to market changes as well as environmental ones like the hurricanes that swept the region in 2017.” Moving forward, Crosslake’s Cunningham is focusing on the micro, not the macro. “Our company focus is on a single route to one that has parallel projects of a full operator,” he said. Paul Scott thinks it is all about added route diversity and network latency driven by cloud consumption, underpinned by multi-purpose hardened facilities. “By working with Deep Blue and C&W to provide and share capacity,” chimed in Deep Blue’s Scott. “The added choice would benefit the 42 million people who live there.” As well as new economies of scale underscored by

changing finance models. Speaking of financial models, Santhosh Rao, head of telecommunications, Americas, at Natixis, was asked by moderator Andrew Lipman about what the key things he looks for when financing a new cable project. He said: “The commercial market opportunities and how viable is the business plan is.” “Every subsea project is unique in terms of its rate of return and commercial potential,” explained Igor Skochilo, vice president of DH Capital. “But more investors need to be educated on where the industry is headed.” What about choosing projects to invest in? Richard Lukaj, senior managing director of Bank Street, said: “Industry experience is critical. It’s a minimum requirement for us.” As for new routes, Skochilo said that it is all about demand and existing infrastructure. However, don’t be fooled even the best equipped locations aren’t a sure thing. “In some of the best-heeled locations we’ve seen massive disruption and that is due to the pull of some of these anchor customers,” said Lukaj. One of the most well attended sessions was the panel on data centres. Vinay Nagpal, president of Interglobix, gave an interesting overview of the market predicting the rapid growth of edge data centres. “I think the data centre model has evolved over the years from the traditional retail colocation model, to wholesale, to cloud-based computing to edge. Over the next five years we expect to see some explosive growth in edge data centres.” Looking ahead, innovation is the key differentiator for the sector. NJFX founder and managing member Gil Santaliz commented: “Don’t expect great results doing average things.”

16 | analysis: egypt

Image: Adobe Stock

TELCOS CASTING AN EYE ON EGYPT

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EGYPT WILL BE THE HOME OF CAPACITY’S FIRST NORTH AFRICA CONFERENCE. JAMES PEARCE TAKES A LOOK AT WHY THE AFRICAN COUNTRY HAS BEEN ATTRACTING INVESTMENT AND INTEREST IN 2018.

n April 2019, Egypt will play host to the inaugural Capacity North Africa conference, bringing together regional and international players in the key connectivity hub of Cairo. It comes at a time when more and more telcos are casting eyes on the ancient country. Egypt has one of the longest histories of any country, with historians tracing its heritage back to the 6th millennium BCE. With iconic monuments, such as the Great Pyramids of Giza and the Sphinx, Egypt holds a unique place in human history. Despite the fact that the country has long been considered a cradle of civilisation, with key early developments there including writing, agriculture and urbanisation, only 53% of Egypt’s population used the internet in 2018, according to Statista figures. That is up significantly from the 43% of regular internet users in 2015 but highlights the need for more access. According to GSMA Intelligence, there are 93.5 million mobile connections in Egypt, but 87% of these are pre-paid. That means a SIM penetration of 93%. However, Egypt is a country on the up, at least in telecoms terms, with the Egyptian government pledging to swap 95% of copper infrastructure for fibre by 2020 – a major overhaul of the country’s telecoms market. To meet the government’s plans outlined

in its Digital Transformation Strategy, Egypt opened local fibre manufacturing plants as part of an agreement between Egyptian HitekNofal Solutions and the Chinese Hengtong Group. Despite the positivity around these plans, only 60% of copper cables have been replaced so far, according to a complaint filed by the government’s communication and IT Committee. Ahmed Zidane, a member of the committee who spoke to news agency Ecofin, said that the committee has filed a complaint with Egypt’s Ministry of Communication over low internet speeds. Egypt has also became a source for international interest, with Liquid Telecom recently announcing an agreement with Telecom Egypt that saw its network expand into Egypt using the latter’s infrastructure. The memorandum of understanding – struck in July - will see Liquid link its network in Sudan into Telecom Egypt’s network through a new cross border interconnection, completing a 10-year project to offer a 60,000km network running the length of the African continent, from Cape Town to Cairo. It means Telecom Egypt’s customers will have access to Liquid Telecom’s pan-African fibre network, which spans more than 50,000km, and access to five key subsea cable systems. Also, TE will offer Liquid greater

reach through its interconnection services. The two companies also partnered in a $400 million deal to build data centres and more fibre in Egypt as part of a move to connect Cairo with West Africa. This network will run from Cairo to Dakar, the capital of Senegal, through Sudan, Chad and Nigeria, with connections to the rest of West Africa, according to Liquid’s owner Strive Masiyiwa. Telecom Egypt will use the network to connect Egyptian businesses to the rest of Africa, and will partner with Liquid Telecom to build data centres across Egypt. Another key aspect for Egypt is its geographical location. As it sits directly between the Middle East and Africa, it has become a key location for subsea cable systems connecting east to west with most running through the Suez Canal. Telecom Egypt is also partnering with a new company, Fiber Misr, for subsea services in Egypt and the region. Fiber Misr is led by former Gulf Bridge International CEO Ahmed Mekky, offering IT and infrastructure services in Egypt. In December, Telecom Egypt signed a memo of understanding with Fiber Misr. In a statement, the Communications Ministry said the project will help upgrade submarine cables and develop information technology services. february/march 2019

Capacity

18 | africa

HELIOS TOWERS MOVES INTO SOUTH AFRICAN MARKET WITH VULATEL PARTNERSHIP Helios Towers has entered the South African market after entering into an agreement with Vulatel to create an infrastructure platform in the country. Helios Towers South Africa (HTSA) will build out wireless and fixed line openaccess infrastructure in South Africa. Some local reports suggest that the company will look to spend around $100 million on building network infrastructure in the country over the next three years. “I am thrilled to announce our entry into South Africa, which delivers against our stated strategy of providing MNOs with open-access infrastructure to meet the growing demands of their customers in Africa for fast, stable and available networks,” said Kash Pandya, CEO of Helios Towers, which owns and leases out 6,500 towers in Africa. “We are delighted to be partnering with Vulatel, a business with impeccable telco sector expertise and deep local credentials

in South Africa. Today’s deal creates a platform that will further diversify our geographic mix and allow Helios Towers to enter an exciting market and expand our product offering.” South Africa had long been considered an attractive opportunity for Helios Towers due to its “economic growth, population demographics and demand for advanced telecommunications services”. The company says that it expects the South African market “to lead the way on 5G rollout in sub-Saharan Africa”. HTSA expects to be able to support this by building greenfield mobile tower infrastructure and the associated high-speed microwave and fibre-optic infrastructure that will enable MNOs to meet their customers’ needs. Vulatel and Helios Towers are ideal partners with the former complementing Helios Towers’ extensive international towers expertise and access to capital

LIQUID TELECOM APPOINTS FORMER AIRTEL Capacity DIRECTOR AS CEO OF ZAMBIAN OPERATION Liquid Telecom has appointed Susan M’kandawire Mulikita as CEO of Liquid Telecom Zambia to accelerate growth and market penetration across the country. Mulikita, who is based in Lusaka, Zambia, joined the pan-African telecoms group in mid-January and becomes the first woman to join Liquid Telecom’s Southern Africa regional executive leadership team as CEO. She has more than 20 years’ ICT experience and is also the first female CEO responsible for ICT in Zambia. The Zambian operations form a key part of Liquid Telecom’s focus on the Southern Africa region, alongside Zimbabwe, Democratic Republic of Congo and Botswana. “This senior appointment marks an exciting new step in Liquid Telecom’s strategy to build Africa’s digital future,” said Wellington Makamure, CEO of Liquid Telecom’s Southern Africa region. Makamure is directly responsible for the leadership, strategic and operational management of Liquid Telecom’s wholesale, enterprise and retail businesses throughout Zimbabwe, Zambia, Democratic Republic of Congo and Botswana. “Susan’s exceptional talent and experience will bring greater synergy to the Southern Africa region, and enable more customers to capitalise on Liquid Telecom’s connectivity, hosting, colocation and digital solutions portfolio – driving innovation and growth across the region. Susan’s

appointment is particularly significant as it demonstrates Liquid Telecom’s continued focus on diversity and inclusiveness, especially at a regional level.” Prior to joining Liquid Telecom, Mulikita had been regulatory director at Airtel from January 2012 and was responsible for telecommunications and ICT law, policy, regulation and stakeholder management. She had a previous 16-year spell at Airtel Networks Zambia between January 1996 and December 2011. A qualified practitioner of telecoms/ICT policy, law, regulation and management, Mulikita was also legal and regulatory director at the Zambia ICT Authority from January 2001 to December 2011. “This is an exciting time to be joining Liquid Telecom Zambia. The company offers a superior service at both carrier and retail level and is poised to compete successfully in the Zambian ICT and telecoms landscape,” said Mulikita on her appointment. “I look forward to working collaboratively with our partners, government and other stakeholders to deliver innovative and compelling ICT and telecoms services. I am also very pleased to join a brand that promotes equal opportunities and inclusive leadership at the highest levels of the organisation.” In October 2018, Liquid Telecom completed the acquisition of the remaining 50% stake in its Zambian subsidiary.

Kash Pandya of Helios (left) with Vulatel’s Tlhabeli Ralebitso

with their experienced management team and established relationships within the South African market. Vulatel will help HTSA deliver not only in the tower space but also in other attractive open-access telecom infrastructure verticals. Tlhabeli Ralebitso, chairman and CEO of Vulatel, added: “There is a significant infrastructure gap in South Africa today, which means the demand in data services is not being met. We are convinced this provides an unrivalled opportunity to build a leading open-access infrastructure platform to address that gap.”

ORASCOM BORROWS $170M FOR AFRICAN EXPANSION

gyptian company Orascom Investment Holding (OIH) has borrowed $170 million to expand across Africa. The funds come from the African ExportImport bank (Afreximbank) and will support Orascom in the delivery of its expansion plans across the continent. Naguib Sawiris, chairman of OIH, said the company will explore business and investment opportunities referred to it by Afreximbank in countries such as Rwanda, Togo, Eritrea, Nigeria and São Tomé. Africa will only progress through intra-African trade and investment growth, said Sawiris. Benedict Oramah, president of Afreximbank, said the deal is part of bank’s strategy to encourage intra-African investments and export manufacturing, using its intra-African investment finance facility. “Our collaboration opens the potential for our two institutions to strengthen their relationship and mutual cooperation in order to make significant contributions towards unlocking the full potentials of intra-African investment,” said Oramah. OIH has existing investments in Egypt, North Korea, Lebanon, Pakistan and other North African and Middle-Eastern countries with a focus on telecoms, media and technology. In September 2018, the conglomerate completed the $90 million sale of its MENA subsea cable, connecting Italy with the Middle East and India, to Telecom Egypt. february/march 2019

Capacity

20 | europe

4G ROAMING TRAFFIC ALMOST DOUBLED IN 2018, ACCORDING TO BICS

4G LTE roaming to grow by 50% in 2019, according to Schachne of BICS

BICS has seen global 4G LTE traffic across its international network almost double in 2018, driven by an increasing demand for connectivity abroad. LTE traffic grew by 95% on 2017 according to BICS, with the European-based carrier predicting this to increase even further in 2019. BICS is saying 4G roaming will grow 40-50% in 2019. “4G LTE roaming has opened up a plethora of opportunities for individual subscribers and businesses alike,” said Mikaël Schachne, VP of mobility solutions at BICS. “However, when demand and reliance increase, so too must supporting

PIERRE-LOUIS DE GUILLEBON LEAVES ORANGE INTERNATIONAL CARRIERS FOR OLYMPIC CHANCE In a Capacity exclusive, Pierre-Louis de Guillebon confirms that he has left his role as CEO of Orange International Carriers. De Guillebon, who had led the Orange International Carriers operations since March 2016, confirmed his move to Capacity, stating: “I moved away from my International Carriers role on 1 January 2019 and have accepted an offer from the Orange executive committee to lead a new Orange Business Unit.” A spokesperson for Orange told Capacity that a CEO successor has been appointed and will be joining the Orange International Carriers team in March. De Guillebon’s new business unit is dedicated to managing major sporting events and will notably be responsible for leading Orange’s activities at the 2024 Olympic Games in Paris. It’s a return to sports for the man who, prior to his International Carriers role, was project director for Orange’s technical

Capacity

De Guillebon now leads Orange’s efforts for the 2024 Olympic Games in Paris

partnership with UEFA for the Euro 2016 football tournament, which was hosted in France. He held that position from January 2012 to July 2016. “It is with enthusiasm that I have accepted this new and exhilarating challenge,” said de Guillebon.

VIRTUS UNDERTAKES EUROPE’S BIGGEST DATA CENTRE PROGRAMME Virtus Data Centres has announced that it is embarking on one of the biggest data centre constructions in Europe with the building of five additional data centres across its London sites. The expansion is to meet the growing demand for what the company says is “flexible, high quality and well-connected” colocation space in London. Due to go live in 2019 and 2020, the five new sites will add approximately 76MW to Virtus’s London portfolio, bringing its total portfolio size to 145MW. Virtus, along with ST Telemedia Global Data Centres, is pledging over £500 million

to the launch of the five new data centres in the London market, as well as the completion of its existing four live sites in Slough, Hayes and Enfield. “Our enterprise and cloud customers have capacity and speed to market challenges in key markets like London,” said Neil Cresswell, CEO of Virtus Data Centres. “Our ability to deliver large amounts of capacity, faster and at a lower cost than other operators is solving these issues for them. We believe that this scale and speed are two key factors, which led Virtus to achieve over 50% market share in London in 2018.”

infrastructure and service availability.” This is because 20% of European subscribers are still to take advantage of the EU’s flagship Roam Like at Home policy. Roam Like at Home was launched by the EU in 2017, forcing European telecoms to drop massive roaming charges when their customers are visiting other EU countries. Schachne said: “European subscribers have enjoyed being able to Roam Like at Home. This is forcing operators in regions outside of the EU to match the European offering by coming together to offer more cost-effective packages to subscribers, while optimising traffic flow at the back-end.”

PACKET CLEARING HOUSE LAUNCHES POPS AT INTERXION MARSEILLE AND MADRID Packet Clearing House (PCH) has deployed two points of presence (PoPs) at Interxion’s data centres in Marseille and Madrid. PCH is a global non-profit company that provides operational support and security to critical internet infrastructures, which include internet exchanges and the core of the domain name system. In addition, the company operates the world’s largest authoritative DNS service network. “By bringing DNS content closer to more users in France and Spain, we ensure the privacy of users’ internet traffic by ensuring it never leaves the protections afforded them by their own country, and by the EU more generally, said Bill Woodcock, executive director at PCH. Interxion’s MRS1 data centre in Marseille, it will be become PCH’s second most important PoP in France acting as the main gateway to Northern Africa. “As a result of PCH deployment, hundreds of networks colocated at Interxion’s facilities will benefit from lower latency to critical internet services,” commented Fabrice Coquio, managing director of Interxion France.

Coquio: Collaboration to create low latency internet connectivity

february/march 2019

Capacity

22 | europe

BT GRANTED DOMESTIC LICENCES FOR NATIONWIDE SERVICES IN CHINA

BT to offer a nationwide service in China, says Bas Burger

BT has become one of the first international telecoms companies to be granted a domestic telecoms licence for nationwide services in China. BT has been granted two licences – one for domestic IP-VPN and another to

become an nationwide internet services provider (ISP) – which enables the UKbased telco’s Chinese arm to contract directly with customers in the country and bill them in local currency. The value-added licences were granted by the China Ministry of Industry and Information Technology, marking a significant win for BT China Communications. It follows cooperation between the UK government and the People’s Republic of China, allowing BT to offer a more localised service. UK international trade secretary Liam Fox MP praised the decision as a “major milestone” for BT and the UK telecoms market. He said: “I am very pleased that close cooperation between the UK and Chinese governments has resulted in BT securing these licences which will enable it to operate across the country. This major milestone exemplifies the vital work of

my international economic department to open up markets and ensure that UK firms are represented on the global stage.” BT, which has operations in more than 180 countries worldwide, labelled the award of the licences a “major step” for the company’s operations in China, where a number of its multinational customers are looking for secure and reliable connectivity services. Bas Burger, CEO of Global Services, BT, said: “We are delighted with this major benefit for our customers. Thanks to cooperation between the governments of the PRC and the UK, we are now able to offer a nationwide service in China that can be scaled up to match the ambitions and needs of our customers. Being able to service and bill locally significantly simplifies the process of delivering connectivity and other communication services.”

ITALY’S UNIDATA PICKS TELIA CARRIER FOR ROME POP Italian service provider Unidata has partnered with Telia Carrier to leverage the international firm’s recently-launched point of presence in Rome to offer enterprise customers global connectivity. Utilising Telia Carrier’s Rome PoP gives Unidata access to Telia’s global fibre backbone, which spans Europe, North America, Asia and the Middle East. Unidata offers a number of enterprise and wholesale services, including fibre connectivity, IP transit, voice over IP and colocation. Renato Brunetti, president of Unidata, said: “Telia Carrier was a clear choice for us when looking for a network partner. Our customers now get the highest

quality connectivity in the region, and Capacity the partnership with Telia means we can continue to evolve our customer offerings through services such as Cloud Connect, which give enterprises a secure, dedicated and scaleable connection to their cloud, wherever it is in the world.” Telia launched its PoP in Rome last year, opting for the NaMeX data centre in the heart of the city. It also operates three other PoPs in Milan – Caldera, Data4 and Supernap – proving IP backbone and cloud connect services to enterprises, operators and content providers. Telia Carrier has made significant investments in Italy during recent years, citing a steady increase in traffic volumes.

When launching the Rome PoP, Telia Carrier also pointed to the benefits of submarine landing stations in Sicily and Bari in order to supply the backbone services needed to serve traffic to other geographical regions, such as northern Africa and the Middle East. “We foresaw the rise in traffic throughout Italy and have spent two years building the infrastructure needed to ensure enterprises, content providers and ISPs like Unidata, can maintain the performance of their services and expand their offerings to take full advantage of internet and cloud-based technology,” said Davide Binaghi, managing director of Telia Carrier Italy. ”

COLT LAUNCHES NEW CLOUD COMMUNICATIONS PROPOSITION WITH MICROSOFT PORTFOLIO Colt Technology Services has launched a new enterprise solution that combines Microsoft’s cloud applications with its own voice and data network capability. The Colt Intelligent Communications suite aims to offer enterprises cloud productivity applications by delivering end-to-end performance, security and reliability in a single IT capability. It utilises Colt’s SIP trunking services, internet and cloud access alongside Microsoft’s Office 365 portfolio to offer businesses a communications solution aimed at boosting productivity and collaboration, Colt said.

“The way business is done has dramatically changed. Colt’s extended partnership with Microsoft ensures our customers have everything they need at their disposal to power their digital transformations and next wave of business growth,” said Rajiv Datta, chief operating officer at Colt. Colt already serves as a connectivity partner to Microsoft’s Azure Express Route, which providers direct private access to the cloud. This solution means it can also offer a strong telephony service through Direct Routing with Microsoft Teams.

Colt helps customers with their digital transformation, says Rajiv Datta

february/march 2019

analysis: network software | 23

ITâ&#x20AC;&#x2122;S THE STUPID SOFTWARE, STUPID IF YOUâ&#x20AC;&#x2122;RE RUNNING A NETWORK ON SOFTWARE YOU NEED TO WORK IN NEW WAYS. Ç§ REPORTS ON ERICSSONâ&#x20AC;&#x2122;S EXPIRED CERTIFICATE THAT BROUGHT MOBILE NETWORKS DOWN

he Ericsson software glitch that brought down networks in December 2018 showed just how the industry has to change its thinking from the days of the hardware era. TelefĂłnicaâ&#x20AC;&#x2122;s O2 UK mobile network and SoftBankâ&#x20AC;&#x2122;s fixed and mobile networks in Japan were out of operation for hours because of, admitted Ericsson, â&#x20AC;&#x153;an expired certificate in the software versions installed with these customersâ&#x20AC;?. Ericsson told SoftBank that networks in 11 countries were affected. It wasnâ&#x20AC;&#x2122;t even old software: it had been installed just nine months earlier. In the UK the outage hit 25 million O2 customers and millions more on virtual networks that run on the TelefĂłnica infrastructure. But, noted William Webb, a consultant who used to run R&D at the UK regulator, Ofcom, it also affected internet of things (IoT) services â&#x20AC;&#x201C; Londonâ&#x20AC;&#x2122;s bus and cycle-hire networks as well as electric car charging and smart metering. â&#x20AC;&#x153;I suspect weâ&#x20AC;&#x2122;ll see this happen in future, possibly with more frequency,â&#x20AC;? said Webb. â&#x20AC;&#x153;Operators are clearly going to worry a lot about it â&#x20AC;&#x201C; the reputational damage and the financial damage. With more IoT networks this would become more and more severe, and it could be life-threatening.â&#x20AC;? What should operators do? The simple answer, he said, is: â&#x20AC;&#x153;Donâ&#x20AC;&#x2122;t let your certificates expire.â&#x20AC;? But in the age of virtualisation â&#x20AC;&#x201C; or softwarisation â&#x20AC;&#x201C; networks â&#x20AC;&#x153;are inherently complicated software machines with old stuff and new stuff, and with 2G, 3G and 4G networks operating in parallel from different vendorsâ&#x20AC;?. Dan Pitt of MEF, the former Metro Ethernet Forum, said: â&#x20AC;&#x153;As you start to deliver software instead of hardware thereâ&#x20AC;&#x2122;s a different licensing model. If the licence is capacitymedia.com

out of date, the software stops working by design.â&#x20AC;? Sue Rudd, director of service provider analysis at Strategy Analytics, groans: â&#x20AC;&#x153;This is the kind of thing weâ&#x20AC;&#x2122;re bedevilled with.â&#x20AC;? The industry is moving to software but itâ&#x20AC;&#x2122;s adopting habits of the enterprise IT business. That means you canâ&#x20AC;&#x2122;t ignore alerts that licences are about to expire. â&#x20AC;&#x153;This is not just an Ericsson problem, itâ&#x20AC;&#x2122;s an industry problem. Someone should

environment, you could in principle change the software dailyâ&#x20AC;?. Are different staff needed in operators in the software era? Pitt at MEF gave telcos â&#x20AC;&#x153;three main choices in evolving to the software-based world: hire new staff with the new skills; retrain current staff to acquire new skills; or outsource those parts of the business that require new skills to organisations that specialise in themâ&#x20AC;?. PCCW Global took the middle way in moving to a software approach, though it also took in new skills through the acquisition of Console Connect. CTO Paul Gampe said: â&#x20AC;&#x153;We were on-net in 100 days, an amazing achievement. But we didnâ&#x20AC;&#x2122;t change the people â&#x20AC;&#x201C; there is immense value in institutional knowledge. Itâ&#x20AC;&#x2122;s not the people, but how you develop large software projects.â&#x20AC;? Gampe added: â&#x20AC;&#x153;Post-acquisition there has been substantial investment in resources and education in how to re-educate the existing staff. Arm them with tools to ensure they can do the job. You canâ&#x20AC;&#x2122;t dump a bunch of software people into a network. Networks are a living thing.â&#x20AC;? But the important lesson of the Ericsson software outage is clear, agreed most of the people I spoke to. â&#x20AC;&#x153;You have to think how to handle error messages that are about a network outage. Make sure the operator sees the alert at high level,â&#x20AC;? said Rudd. Pitt agreed: â&#x20AC;&#x153;If you license software you have a responsibility to make sure it works.â&#x20AC;? Telcos have to agree with their software companies what happens when a licence expires â&#x20AC;&#x201C; and they should trust each other, said Milham. â&#x20AC;&#x153;Certificates and licences shouldnâ&#x20AC;&#x2122;t be unknowns. You need to build a software asset register.â&#x20AC;?

This is not just an Ericsson Capacity problem, itâ&#x20AC;&#x2122;s an industry problem. Itâ&#x20AC;&#x2122;s not OK to do just what the IT guys do â&#x20AC;? Sue Rudd, strategy analytics

have seen the warning message. Was it ignored? Even if it went to network operations, they probably ignored it too. Itâ&#x20AC;&#x2122;s not OK to do just what the IT guys do. With telecoms, you must always provide users with service.â&#x20AC;? Roberto Kompany, who leads the next-generation wireless programme at market research company Analysys Mason, agrees: â&#x20AC;&#x153;The ecosystem is changing: itâ&#x20AC;&#x2122;s becoming more softwarised, and more complex because there are more vendors.â&#x20AC;? Pitt agreed: â&#x20AC;&#x153;In a disaggregated world, the hardware and multiple software programs might be procured from different sources, leading to interaction problems.â&#x20AC;? Even with industry standards, â&#x20AC;&#x153;each vendor can find pieces to tweakâ&#x20AC;?, noted Kompany. The TM Forum is often regarded as the organisation that encourages the telecoms software industry to work together. Chief architect David Milham warned that this is getting harder. â&#x20AC;&#x153;As we move to a software-based environment the velocity of change is speeding up.â&#x20AC;? Hardware changes are relatively infrequent, â&#x20AC;&#x153;every six months or soâ&#x20AC;?, but â&#x20AC;&#x153;with a virtual

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executive interview: alexandre pébereau | 25

IBASIS TO RETURN UNDER PÉBEREAU’S CONTROL Tofane founder Alexandre Pébereau expects to complete the purchase of iBasis in the first full week of February. He tells Alan Burkitt-Gray of plans for a relaunch and integration with the former Altice wholesale operation

he new, expanded Tofane Global will make its first public appearances at Mobile World Congress and Capacity Middle East – as iBasis. The company, which last year completed its purchase of Altice Europe’s wholesale business, will face the market under the long-established name of its second buy. In mid-January Tofane’s founder and CEO, Alexandre Pébereau, was confident enough that his acquisition of iBasis from KPN that he was happy to give his first interview about the relaunch to Capacity. “We will keep the name iBasis but will refresh the brand. The market said iBasis has a long track record and the name is very strong in the carrier community. Everything will be under the name iBasis, for voice, for mobile and for IoT.” The Tofane Global name will stay, but only as the holding company. “Tofane powers iBasis,” he says.

in the top three for LTE IPX. We have more than 1,000 customers worldwide, with 300 employees, and 18 offices on four continents.” Tofane’s next target: the international voice, data and mobile market, which Pébereau puts at more than $46 billion. The wholesale operation acquired from Altice, in a deal that was completed in September 2018, already brings Tofane substantial business in the French and Portuguese-speaking world. Capacity The pair of acquisitions has brought Tofane – or the new iBasis – strong relationships with KPN, the former owner of the old iBasis, and with Altice’s businesses, including SFR and the former Portugal Telecom, now Altice Portugal. “We could be much stronger in French and Portuguese speaking markets, in north and west Africa, and in East Timor in Asia,” says Pébereau.

iBasis has a long track record and the name is very strong in the carrier community” Alexandre Pébereau, Tofane Global

Pébereau, who was CEO of Orange International Carriers until 2016, announced the two planned acquisitions within days of each other in March 2018, first the whole of iBasis, KPN’s wholesale arm, and then the international wholesale activities of Altice Europe, the company that owns SFR in France, the former Portugal Telecom and a mobile business in the Dominican Republic. “It’s one of the fastest acquisitions in this industry,” he says of the iBasis deal. “We have done it in less than 10 months.” The two wholesale operations will be integrated, creating a company “with $1 billion in revenues, with 30.5 billion international minutes”, he adds. “We are the third largest wholesale voice carrier and capacitymedia.com

These areas are “very complementary to the iBasis footprint”, he adds, which is “very strong in North America and western Europe”. With the addition of iBasis, Tofane will get “60-70% of additional traffic on top of Altice”. The scope of the deals expanded even before they were complete. Originally Pébereau was planning just to buy Altice’s wholesale fixed voice business, but that was expanded before completion to include mobile voice. Now he wants to invest in several new product segments, including mobile data and the internet of things (IoT), he tells me. “We intend to be much stronger.” He wants to build “a mobile services portfolio.” There are also opportunities in anti-fraud services.

Fraud “has become not only a plague but also a source of added value”, he notes – added value, that is, to companies that offer services to combat it. But let’s take a step back. For someone who has run the international wholesale business of a major global telco, Orange, what is the advantage of a company that is just an international wholesale carrier, with no national retail services? It’s focus, he says. “The telecoms industry has so many deep changes nationally that international services get lost in the loop. We have that focus. The international business is 5% of the business, but only 5%. The added value we bring is that we care.” And “the international part is very complicated”, he adds. Carriers have to contend with specialised equipment as well as a different set of regulations and many different currencies. “It’s a lot to do, but the market is big enough for an international player.” There’s an extra point: “We are independent,” he says. What Pébereau refuses to talk about is how much Tofane has spent on its two acquisitions. “All figures are confidential. We cannot comment on the price,” he says. But “we are backed by strong financial partners, and we have the money to do it”. Tofane Global’s website lists a number of backers, mainly French private equity investors focused on small and medium sized companies. He’s recruited Patrick George, formerly of Orange, Syniverse and BICS; Manuela Simões, a subsea cable engineer who was later head of roaming and international traffic at Portugal Telecom; Nicolas Barret, formerly SFR’s international VP; and Céline Grégoire, once at Teleglobe and Tata Com. Technology and IT are in the hands of François de Vulpillieres, once at Nortel and later SFR. “We plan to integrate – everything about the IT and the network has been prepared,” says Pébereau. “Now we are going to deliver our plan for the investors and our customers in the next 12 months.”

26 | asia and asia-pacific

TELIA CARRIER DEPLOYS SECOND POP IN HONG KONG Telia Carrier has opened its second point of presence (PoP) at the Equinix HK1 data centre in Hong Kong. The deployment of the new PoP enhances the local availability of highspeed IP transit, cloud connect, Ethernet and IPX services for operators, content providers and enterprises alike. Telia Carrier head of sales Asia-Pacific, Wee Kwan Ee, said: “Our customers constantly ask us to expand our presence in this region, driving the need to light up a second PoP in Hong Kong. This new PoP also extends our reach into all other Equinix sites in the city, increasing our reach to a total of five Hong Kong sites overall.” Because of online gaming, rich internet and video content, there has been a significant increase in the amount of IP traffic moving through the APAC region, according to Telia Carrier.

Veteran Carl Roberts leaves Epsilon after two years as chief commercial officer

BANGLADESH ‘NEEDS THIRD SUBSEA CABLE’ The government of Bangladesh has announced plans to build a third submarine cable system to meeting growing data demands. Telecom and ICT minister Mustafa Jabbar confirmed the news: “We have decided in principle that we will go for a third submarine cable.” The first subsea cable in the country, SEA-ME-WE 4, went live in 2006 and is near to reaching the end of its 20-year lifespan, said an official of state-run Bangladesh Submarine Cable Company. Jabbar added: “The growth rate is flying, so our total capacity will be exhausted within next year.”

Capacity

EXCLUSIVE: CARL ROBERTS LEAVES EPSILON Carl Roberts has left Epsilon Telecommunications after just over two years as chief commercial officer. “I had a great two years at Epsilon and had the opportunity to work with some great people,” he told Capacity. “During this time, the company achieved significant double digit growth and substantial positive transformation. It was also a time during which the company and brand image have evolved. Epsilon is now playing in the major leagues and has stepped into the light. I am very proud to have been a part of that and I certainly wish Epsilon continued success in the marketplace.” Roberts spent 15 years at Verizon and its predecessors before leaving in 2015. He joined Epsilon in late 2016, based in Dubai and Singapore. “I flew five and a half times round the globe in 2018,” said Roberts. “I’m looking forward to catching up with my industry friends and

colleagues at Capacity Middle East and ITW.” Capacity Middle East is in March, and ITW, which this year moves to Atlanta, is in June. He is working on new opportunities. “There are a lot of interesting things on the market. One of the big themes is the shift to software defined networks. And there are a lot of talented and experienced folks in incubators, developing some really clever solutions”. He added: “Before joining Epsilon I had to put a number of key projects on hold, which I will now return to. I still have the four Es going for me – experience, expertise, energy and enthusiasm. So I am looking forward to an exciting future.” Capacity Media, the publisher of Capacity, gave Roberts a lifetime achievement award at the Global Carrier Awards in Paris on his departure from Verizon in 2015.

INDIGO CONFIRMS COMPLETION OF NEW CABLE

Mustafa Jabbar: Capacity will be exhausted by 2020

AARNet, Google, Indosat Ooredoo, Singtel, SubPartners and Telstra have confirmed the completion of the Indigo West and Central subsea cable systems. “The completion of the Indigo cable system heralds a new era of high speed communications between the

growing economies of Southeast Asia and Australia,” said Ooi Seng Keat, Singtel’s VP of carrier services and group enterprise. “This new data superhighway will complement our existing global links to Asia, US, Europe, Australia and the Middle East.” february/march 2019

executive interview: andrew kwok | 27

HGC SETS OUT ON EXPANSION DRIVE FROM HONG KONG In the hotel garden outside Capacity Asia, Andrew Kwok tells Alan Burkitt-Gray about HGC’s developing business. But there are some things he won’t talk about

year after ownership of HGC Global Communications moved from its Hong Kong parent to a US private equity company, CEO Andrew Kwok is developing plans to build a services business and to acquire more companies. New York-based I Squared Capital (ISQ) paid $1.9 billion at the end of 2017 to CK Hutchison to take over 100% of its former international and fixed operation, which Kwok has been with for years. Until the completion of the acquisition his job title was president of the international and carrier business of Hutchison Telecoms (Hong Kong). But the only thing Kwok resolutely refuses to talk about is the role of ISQ and its industry strategy; still less its position as one of the two bidders for troubled Indian business Global Cloud Xchange (GCX) and Reliance Communications (RCom). He shakes his head: “Can’t say anything.” But he can talk about the things that HGC has done since it moved to its new owner. “We still have a very big link with Hutchison, a long-term contract and a relationship,” he says. “But after we became an independent company the first thing that happened is that more companies came to talk with us. Now the sky is wide open,” he says. In particular, it seems, content companies now recognise HGC as a newly independent operator that is not a potential competitor. We’re sitting in a garden outside the hotel that is the venue for Capacity Asia at the end of 2018. We’re under an ancient baobab tree that shaded the British military barracks that once stood on the site; the hotel has added bronze statues of gardeners, a photographer and a courting couple on a bench – she’s feeding him a bronze potato crisp. Around us are the

sparkling lights of Christmas decorations. Under new ownership, HGC is also free to talk to CK Hutchison’s competitors in Hong Kong. Just before our meeting, Kwok told a panel at Capacity Asia that the company had “just finished a test in Hong Kong with Hutchison and China Mobile Hong Kong” as part of a plan to move the local fixed edge closer to the customer. Capacity for fixed “There’s an opportunity operators,” he told the conference. “There’s a new model – a shared network.” With ISQ’s support, HGC has already agreed to buy a controlling stake in a Myanmar fixed-line operator, GTMH. “It’s a Myanmar fixed-line company. All the formalities are done. We’re pushing for the agreement to be done, waiting for government approval.” It offers cloud services and local fixed services for mobile operators, he adds. Once the deal has official sanction, Kwok hopes that the previous team will continue to work under the new majority ownership. “We’re not a company that goes into a country to buy up a business and run it ourselves. We want the previous investors to take part and do it together with us. GTMH is a private group of people and deeply involved in the industry.” GTMH “is only one example – the first”, he adds, indicating that HGC is on the lookout for more. “We are going to have more projects.” Meanwhile Kwok has started the process of transforming HGC itself. One of his first moves, in February 2018, was to appoint a former Telstra executive, Jacqueline Teo, as chief digital officer. “She’ll drive two things,” Kwok tells me in the Hong Kong garden: “Internal digitisation and also HGC’s external offer – how we face the market. The digital officer will drive

external opportunities and aggressively go out to help our business expansion.” Teo has been joined by “a bunch of software people” so that HGC can develop its offer to enterprises – companies that used to have their own IT departments. In the past year, HGC has been developing new services in south-east Asia with a number of partners. One that Kwok is particularly proud of is a deal with WeChat, Tencent’s messaging, social media and mobile payment operation, so that customers can pay their bills and buy services online. “How can I use the technology to join with the financial industry to look for new business?” he asks. “I can access 900 million WeChat users this way. They can pay for Wifi access through their WeChat account.” Kwok is calling this move “techfin”, to contrast with the more common “fintech” term for services for the financial industry. “We can use our technology to participate in and help the financial industry.” At the same time the company has also set up the first two of what it calls big data exchanges (BDXs), targeting smaller over-the-top (OTT) operators that Kwok believes will be entering the market. “OTTs will come into different market sectors and we are facilitating them.” One BDX is in Hong Kong, where HGC is headquartered. “Infrastructure is at the base of it all,” says Kwok, noting that infrastructure accounts for 70% of the business. “We build services on top.” That’s the other 30%, he adds. With that, he heads back from the garden into the crowds inside the Capacity Asia event, stopping at almost every small group of people to shake hands and exchange a few words. Kwok is clearly big in telecoms in Hong Kong. february/march 2019

28 | asia and asia-pacific

RCOM AND GCX’S FATES IN HANDS OF INDIAN SUPREME COURT

Bill Barney: always confident about the future of GCX

Troubled Indian operation Reliance Communications (RCom) made a partial debt payment of 1.31 billion rupees ($18.8 million) to Ericsson in January as their dispute escalated. Ericsson told the Indian Supreme Court

that the payment was not enough – and said the company should pay the full 5.5 billion rupees ($78.9 million) for the vendor’s involvement in RCom’s now abandoned mobile network. Even that is a fraction of what RCom originally owned Ericsson – which last year demanded a sum closer to $100-$150 million. Ericsson is asking for the company’s chairman, Anil Ambani, to be jailed for nonpayment of the debt. Capacity understands Ambani is directly handling negotiations over the future of the company. At the same time the government’s Department of Telecommunications was refusing to guarantee to the unrelated rival Reliance Jio that it would be immune to any past spectrum dues that RCom still owes. Jio is run by Anil Ambani’s brother Mukesh. The long-running crisis affecting not only RCom but its international subsea cable

business, Global Cloud Xchange (GCX), is likely to come to a head during February and March. Bill Barney, CEO of RCom and GCX, refused to comment to Capacity but has always expressed confidence in GCX’s plans, which include the Eagle subsea cable from Mumbai westwards to the Middle East and the Mediterranean and eastwards to Singapore and Hong Kong. Last year GCX invited bids from a number of private equity investors and is understood to be still considering two, even though RCom’s legal challenges have delayed a resolution. The two bids put in last year for GCX, the data centres and the Indian enterprise telecoms business were both for $1.1 billion. One comes from I Squared Capital (ISQ), the company that owns Hong Kong-based HGC Global Communications and has been named in rumours about Zayo’s future.

HGC PARTNERS MEGAPORT FOR MULTI-CLOUD CONNECT SERVICE HGC Global Communications has partnered with Megaport to launch a new on-demand multi-cloud connectivity service in over 380 enabled data centres. The Multi-cloud Connect Service (MCCS) will enable seamless, flexible, on-demand and secure connections to a multi-cloud platform in numerous data centres, meaning corporate users can connect to a number of key cloud service providers. Andrew Kwok, CEO of HGC, said: “Our collaboration with Megaport is very important as corporate customers nowadays demand flexible private connectivity to global cloud platforms.

While corporate customers have access to HGC’s strongCapacity infrastructure base and ondemand services, their growing demand for one-stop solutions can also be met by enabling them to leverage cloud-based applications through this newly-launched MCCS service. This is another example of HGC’s continuous commitment to becoming a leading ICT service provider in the market.” The MCCS service provides direct access through HGC’s network to Megaport’s ecosystem, which consists of over 300 cloud services providers, including the likes of Alibaba Cloud, AWS, Azure, Google Cloud, IBM

Cloud, Oracle Cloud and Salesforce. Existing HGC MetroNET customers can switch on the MCCS service using existing local connectivity with a virtual LAN (VLAN). This means HGC customers can connect to multiple cloud regions through a single interconnection point. It will also use Megaport’s SDN technology to offer flexibility in bandwidth configuration, allowing for sporadic burstable traffic in order to boost the performance of mission critical cloudbased applications. MCCS customers will also be able to leverage HGC’s global network reach.

EPSILON APPOINTS FORMER TALKTALK COO AS MD Epsilon has named former TalkTalk chief operating officer Colin Whitbread as its new managing director of service and operations. Whitbread will be tasked with driving the transformation of the company’s technology innovation and delivering new levels of customer experience for the global business, Epsilon said. He will be based in Epsilon’s London office. Whitbread brings over two decades of telecoms experience to the role. His most recent position was as COO of UK-based telco TalkTalk, a role he held from 2014 until last year. He also spend more than two years as chief network officer at the company. He joined TalkTalk in 2012 from Level

3, where he was VP of operations for the EMEA region. He has also worked for Cable and Wireless, the BBC and Spanish cable firm Ono. “Epsilon is one of the most exciting businesses in global networking. It has been on an incredible journey and I see tremendous opportunity to serve more customer segments across the globe,” said Whitbread. “I’m excited to be part of Epsilon’s next phase of growth and help enable it to seamlessly scale its operations; offering network-centric businesses the best possible end-to-end customer experience. It is a time of significant change in Epsilon’s business and I’m proud to be a part of it.”

Colin Whitbread to help Epsilon seamlessly scale its operations

february/march 2019

Capacity

30 |

Can you build a Great Wall round Chinese vendors? Capacity

SOME PEOPLE SEEM TO WANT TO ISOLATE THE TWO CHINESE VENDORS FROM THE REST OF THE NETWORK. WHAT ARE THE REASONS, ASKS Ç§ . AND WHAT IS THE EVIDENCE?

f youâ&#x20AC;&#x2122;re one of those who think it is possible to build a Chinese wall between the parts of the global telecoms systems that use Huawei and ZTE technology and the rest, consider this. Many companies in the industry are gradually adopting the Open Networking Automation Platform (ONAP), an open-source networking project that was formed in February 2017 when two open-source projects merged. One was an open version of AT&Tâ&#x20AC;&#x2122;s ECOMP and the other was the OpenOrchestrator project, backed by the Linux Foundation â&#x20AC;&#x201C; still the home to ONAP â&#x20AC;&#x201C; with three lead contributors: China Mobile, Huawei and ZTE. I repeat: China Mobile, Huawei and ZTE merged their open-source project with AT&Tâ&#x20AC;&#x2122;s, a company banned from using Huawei or ZTE hardware and software in its home market. Complicated, isnâ&#x20AC;&#x2122;t it? To be fair, if youâ&#x20AC;&#x2122;re reading this youâ&#x20AC;&#x2122;re

almost certainly in the telecoms industry and so you understand how integrated everything is. Youâ&#x20AC;&#x2122;re more likely to believe a wall is the answer if youâ&#x20AC;&#x2122;re a politician. But its not just in open-source telecoms that Huawei and ZTE have a pivotal position. The two companies are leading the global programme to create the next generation of mobile, 5G. Consider this: research by Berlin-based intellectual property company IPlytics shows that the top 10 owners of critical 5G patents have 6,632 patents between them. Huawei, ZTE and the China Academy of Telecommunications Technology have 2,081 patents â&#x20AC;&#x201C; 31% of the total. IPlytics also analyses what companies are contributing. Huawei comes out on top, and it has a higher attendance at 5G meetings than anyone. If you cut Huawei and ZTE out of 5G, the industry would lose access to much of its intellectual property. Thatâ&#x20AC;&#x2122;s the quandary

that the international telecoms industry finds itself in, just as it commits to billions of dollars of investment in 5G, a technology that is widely held to be about to transform the business, bringing huge new markets.

The Cell in Banbury This is all happening just as Huawei in particular is fending off accusations that its networks have security vulnerabilities. These accusations have been around for a long time, which is why five years ago it set up the Huawei Cyber Security Evaluation Centre (HCSEC) in the UK. Nicknamed the Cell, it is overseen by the UKâ&#x20AC;&#x2122;s own spooks but is funded entirely by Huawei. It shares an industrial estate in Banbury with giant sheds occupied by a tool hire company, a catering supplier and a dozen others. Thereâ&#x20AC;&#x2122;s a McDonaldâ&#x20AC;&#x2122;s on the corner. In mid-2018 the HCSEC reported a problem: something that it judged may pose february/march 2019

Image: Adobe Stock

feature: chinese vendors | 31

threats to telecoms networks in the UK. No backdoors, but “shortcomings in Huawei’s engineering processes ... have exposed new risks” that provide “long-term challenges”. I’ve talked to people who know. What seems to be the problem is that engineers tweak software too often. It’s a challenge that’s appeared in other areas of telecoms – hardware takes months to change; software can take hours. Those trying to ensure security are unsettled by this, as each change needs more checks. Huawei said in December that it will spend $2 billion or more improving its software engineering. As well as the Cell in the UK, there are other units in other countries. Canada has a facility run jointly by Bell, Rogers and Telus. In Germany, Huawei has a lab in Bonn – close to Deutsche Telekom’s HQ – so that customers can test hardware and software, including source code. In Australia, Telstra has its own security team that tears apart any equipment and software that’s being considered for its network to hunt for vulnerabilities. Talk to the CTOs of telcos, however, and most do not express concern. In November Huawei held a mobile broadband exhibition and conference in London, where BT’s EE mobile unit was showing off 5G services powered by Huawei. The event was also attended by Telefónica UK, CK Hutchison’s Three UK and Vodafone UK. Visitors included Bell Canada: an executive lauded Huawei’s ability to supply base stations that brought mobile broadband to the Arctic.

CTOs keeping heads down I contacted a dozen CTOs of major companies across the industry. Most – even those who only recently told me how delighted they were with Huawei – just kept their heads down. One phoned me on my private number. “I don’t want to email – I think they read my emails.” The telco’s management, that is, not anyone more sinister. This person was speaking without the sanction of their company. “All vendors’ software has holes, but no one is testing the others,” meaning non-Huawei software. “At least in UK it’s done by an independent agency,” said this person, meaning the Cell. “Yes, the Chinese government backs Huawei – but other governments back their companies,” said this CTO, who lamented the disappearance of many Western telecoms suppliers from the market – Lucent, Nortel, Siemens, Alcatel, Marconi and others. “Then people wonder why we capacitymedia.com

have to go to Shenzhen,” the home city of both Huawei and ZTE. Telstra is also a fan of both Huawei and ZTE. Australia’s government has accepted US demands that it ban Chinese network equipment – that means Telstra, Optus, Vodafone Hutchison and TPG. Telstra was the first Western operator to use Chinese mobile equipment in a big way, when it went to ZTE for Hong Kong’s CSL, before it sold it to PCCW’s HKT. So impressed was Telstra that it built an experience centre in Hong Kong, so that potential clients of ZTE could see networks in action after visiting Shenzhen. I visited it myself back in 2004. “We had 200 telcos from around the world come to visit,” a Telstra executive told

over US allegations concerning Iran, which she denies. Security concerns have not featured. The US followed in late January with charges personally against Meng and against the company alleging bank fraud in connection with illegal sales to Iran through a front company, Skycom.

Lying to banks, says the US Matthew Whitaker, acting US attorneygeneral, explained: “When a bank’s customers lie to it about their sanctionsrelated business, that exposes the bank to the risk of violating the law, especially when they continue to provide those bad actors access to our US financial system. Our sanctions on Iran are the law of the land in

If operators can buy from only Nokia and Ericsson they will put up their prices. If network equipment costs more you buy less” Bengt Nordström, CEO, Northstream

Capacity me. The same executive added that they would really like to use ZTE equipment for Telstra’s 5G network in Australia. But the Australian government said “No”. The executive said: “We will use Ericsson instead, but it’s too f***ing expensive.” Some years ago AT&T acquired a pair of Mexican mobile operators, at least one of which was a Huawei customer. It then upgraded the network to 4G and at Mobile World Congress in 2016 I spoke to Ralph de la Vega, then the AT&T Mexico VP. He confirmed to me this was the first time it had Huawei equipment in any of its network. Huawei was a supplier to Mexico before AT&T’s entrance, but it was clear there had been a substantial re-equipment programme over the previous year. “It should be seamless,” de la Vega told me in 2016. “You should be able to take a car from Canada to Mexico and you shouldn’t drop a call.” I asked him how the Huawei kit was performing in Mexico. “So far, excellent. Huawei is a good supplier.” Last year was challenging for both Shenzhen companies, not over security but over Iran. ZTE admitted to using illegal means to export US hardware and software to Iran. That shows, by the way, how important and powerful IP law is. If you can’t include chip and software technology from the US, you’re stuck – and ZTE nearly closed down before it agreed to pay a $1.4 billion fine and accept a US lawyer as overseer. The year ended with the arrest in Canada of Meng Wanzhou, Huawei’s CFO – again

this country – and we’re going to enforce the law, with both civil and criminal penalties.” Is there a security risk in Huawei and ZTE systems? In December 2018 the Germany government IT security agency, Bundesamts für Sicherheit in der Informationstechnik (BSI), said there was no evidence. It said there are “currently no reliable findings”. BSI president Arne Schönbohm said: “For such serious decisions as a ban you need evidence.” I talked to Bengt Nordström, CEO of the Northstream analysis company. He said: “I don’t know how real these security concerns are. My concern with the situation is that we’re all losers – the outlook is negative for the whole telecoms sector.” He compared the situation with the financial crisis that started when Lehman Brothers collapsed in 2008. “We realised how interlocked the banking sector is. If a major player falls it has implications across the whole value chain.” Competition is “the reason we walk around with a supercomputer in our hands costing €500 – because we’ve had superintense competition between all players”, said Nordström. “The only reason Huawei and Ericsson and Nokia are spending so much on R&D is because of access to global markets.” He warned: “If operators can buy from only Nokia and Ericsson they will put up their prices. If network equipment costs more you buy less.” Follow www.capacitymedia.com for updates on this story

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Capacity

feature: mobile gaming | 35

of the hurdles that game streaming apps – such as Sony’s PlayStation Now – are dealing with today. Microsoft says it is creating the “Netflix for games”, aiming to establish itself as the de facto standard in video game streaming services, and public trials of Project xCloud are set to take place this year. Some games today are so bandwidthintensive and require such serious processing power that digitisation opens the door – but making high-end, processor-intensive games available through streaming services opens the door. Microsoft has its own data centres all over the world, which help to ensure end-to-end quality and latency, given the demands of video-game streaming.

Image: Adobe Stock

5G and edge combination The target is to make a mobile gaming experience comparable to a console-based experience. That means the combination of 5G and edge computing can support continued growth in this valuable segment. New technologies, such as cloudlets, micro data centres, fog – using edge devices to carry out a substantial amount of computation – and mobile edge computing, aim to provide storage and computational resources close to a user at the network edge, to minimise latency and response time. In September, Deutsche Telekom and US-based Aricent announced the creation of an Open Source Edge software framework. Designed especially for developers, it aims to aid the deployment of 5G-enabled network edge facilities targeted at delivering ultra-low latency network applications. The edge platform is built for software-defined data centres and is decentralised. “The mobile gaming market has been growing rapidly till it hit some roadblocks recently,” Shamik Mishra, assistant VP of technology and innovation at Aricent, tells me. “Most gaming solutions today require vast amounts of compute, processing and data storage capabilities and mobile devices have constraints in fulfilling these requirements. “For a while, the cloud was able to help with this as a significant portion of the gaming solution ran in the cloud. But the constraints of latency kicked in. The further the cloud is from a device, the more the latency. It is actually down to the speed of light. And, naturally, gamers hate delays.” There is a big opportunity to create a network slice to give a gamer access to local cloud compute capabilities and get that end-to-end latency so they get an experience that feels like they have a capacitymedia.com

top gaming computer in their home. Mishra, who led the Deutsche Telekom edge computing project, believes edge computing and the ultra-reliable low latency network that 5G will offer can potentially solve this problem. “That’s because the edge computing or the network edge or a data centre – it could be even a device or a rack of servers or a micro-data centre – at the edge of the network can host the gaming solution,” he says.

Powerful computing “The network edge can have powerful computing capabilities, intelligence, hardware acceleration and large storage. With low-latency networking, the access and experience of the gaming solution from the end device improves drastically. Many carriers are exploring this capability.” The pressures for connectivity from the mobile gaming community is certainly being felt by data centre companies. Bryan Hill, Interxion’s director of business development for digital media, explains: “Mobile gaming has been a blossoming industry for years now and demand for connectivity is continuing to Capacity grow as new technologies like AR and VR develop and become more commonplace.” However, cloud gaming, is early in its evolution– but “it is already driving data centre requirements in the high hundreds of kilowatts through to low megawatts”, Hill says. “Both mobile and cloud gaming require dense connectivity from carriers and internet exchanges to be able to serve their users with the low end-to-end latency that core gamers require,” he adds. “For gaming companies in Europe, this means working with providers that are present in major centres across all the largest video gaming markets. As the gaming industry continues to grow, and as the complexity and detail of gaming titles increase, we expect to see a greater demand for data and connectivity. Data centres will certainly play a key role in providing this.”

Caching content Carriers and content delivery networks (CDNs) can help to address this by helping to cache content closer to the end user and offering dynamic bandwidth solutions which can enhance the overall experience. Orange is also continuing to develop switching from a transit network to a CDN. It is deploying a network of CDNs, pushing content closer to its customers and, in turn, aiding them with the explosion of traffic and their latency

battles, which typically stem from video and gaming. “We have added more direct access for content providers with our network and we’re developing our own CDN solutions,” says Pierre-Louis de Guillebon, until recently the head of Orange International Carriers. “One offering is that they can host their own solutions but Orange is also adding its own services for local content access.” CDNs also have a critical role to play in the success of mobile gaming. Limelight, one of the biggest providers of CDNs to the gaming industry, works with the likes of Nintendo and GameOn. It recently formed a partnership with Ericsson to provide computing capabilities at network edges. This is ideal for new low-latency applications such as IoT, gaming, and virtual reality. Steve Miller-Jones, VP of product strategy at Limelight Networks, tells me: “As more traffic shifts to the public internet from private networks, the need for high performance networks and distributed infrastructure is required to maintain a high-quality user experience. A key solution to this is edge cloud computing.” Limelight has been helping Ericsson partner with service providers through its unified delivery network (UDN) edge cloud platform. This is a web-scale edge delivery network that drives performance benefits and cost efficiencies. Content delivery is the first application built on the UDN platform and under the agreement, Limelight’s content delivery technology will be deployed on Ericsson’s UDN edge cloud platform to expand its delivery capabilities and increase capacities. “By providing computing capabilities close to the user or device, edge computing addresses rapidly increasing data demands and subscriber experience expectations through distributed infrastructure, while maintaining high quality and high performance,” adds Limelight’s Miller-Jones. “Low-latency applications such as gaming are set to benefit. We know from our own global consumer study that fast performance is gamers’ top concern ahead of simple gameplay, an interesting storyline and the ability to play the game when not online.” Ultra-low latency is critical to dataheavy and rich mobile gaming. The combination of technologies, such as network slicing and edge computing, will become increasingly important because it’s not only the latency of the network that is important with cloud gaming, but the end-to-end nature of it.

36 |

Netflix – maximum reach, minimal infrastructure Capacity

etflix consumes 15% of the world’s internet traffic - at least that is what the numbers say. According to a recent report by bandwidth management company Sandvine, Netflix is the number one downstream application in the world. Clever use of bandwidth and network management is needed to deliver immersive video experiences. On the part of Netflix, one of the people charged with this task is Dave Temkin, VP of networks. Temkin credits the company’s Open Connect programme as one of the drivers of this trend of growing internet consumption. The programme enables internet service providers (ISPs) to deploy capacity as close to their end users as they need to, reducing costs and improving the experience of customers. “Internet video is the future, and I believe that we are still very early in the shift from linear video to internet TV,” says Temkin. “Consumers want to watch what they want, when they want it – and Netflix helps accomplish that.” Available in over 190 countries, Netflix has

Dave Temkin of Netflix speaks to Natalie Bannerman about what makes the OTT content provider the number one downstream application in world and how it manages to scale so effectively

a presence in 97% of the world’s markets. So how does the content provider manage to deliver so much content on such a large geographic scale? Simply put, it does this through a purpose built content delivery network (CDN) combined with programmes such as Open Connect. In doing so, Temkin says, Netflix is able to deliver terabits of traffic at its peak while reducing cost and simplifying the process for ISPs. “Having a fairly homogenous product allows us to realise advantages that most CDNs cannot, such as server hardware specifically optimised for delivering long form video, and a network that operates in a mostly decentralised fashion,” he explains. “By sharing these designs publicly we’ve also allowed others the ability to benefit from the work we’ve already done.”

Plans for infrastructure Unlike its peers, such as Facebook, Google and AWS, Netflix has steered clear of investing in telecoms infrastructure. It’s widely known within the industry that OTTs are attracted by the cost benefits of becoming an owner, especially in the subsea sector

where they are able to join a consortium of telecoms operators, that will manage the running and operation of these systems. However, because Netflix operates a little differently there is no business case for it to join the fray. “We don’t purchase significant amounts of subsea or terrestrial fibre transport capacity, and the transport capacity we do purchase is used mainly for pre-positioning content on appliances,” Temkin says. “The most capacity we have on a single transport route today is 100Gb, and so because the amount we purchase is so small, the economics don’t work for ownership.” On the tower side of things it’s a similar story. Temkin shares that a number of mobile providers have expressed interest in placing Netflix servers closer to end users, just not necessarily at towers. But once again, the economic and performance benefits don’t make sense for the company. “Our application is not highly latency sensitive and the cost of fibre is going down while density is going up – nearly 40Tb dense wavelength division multiplexing (DWDM) systems are commercially available february/march 2019

the big interview: dave temkin | 37

2004

Senior network architect, Lava Trading

2007

Network architect, Yahoo!

2008

Network engineering manager, Netflix

2012

Founder, Open-IX Association

2015

Vice president of networks, Netflix

to ensuring the application works well on all networks across all mediums. “In some markets, like India, a more significant portion of viewing is done on mobile. We are working quite closely with mobile providers like Airtel to not only make our application work well on their networks, but provide consumers with promotions and bundles to reduce and simplify their monthly bill,” he comments. Despite the company’s lack of presence in places like China and North Korea, Asia – particularly India - is a key market for Netflix Temkin says. Across the board, industry experts are beginning to see increased traffic coming from Asia, especially with the rapid uptake of content and gaming in the region. “We presently have two points of presence

Consumers want to watch what they want, when they want it – and Netflix helps accomplish that” Capacity Dave Temkin, vice president of networks, Netflix

today,” explains Temkin. “The added complexity of having server hardware closer to the tower is unlikely to result in cost or performance improvements over and above what can be done by deploying Open Connect appliances in the middle and edge tiers of the network.”

Future trends Though 70% of its users continue to watch content on TVs there are 30% who choose mobile. As mobile technology improves and devices get better it’s fair to assume some growth in mobile streaming. 5G is one of the emerging technologies set to revolutionise the mobile sector. Its impact is set to be far reaching and Netflix is no exception. “5G will change the access dynamics for millions of users around the world, potentially opening up access to the service in ways that are not feasible today,” says Temkin. “We continue to focus on making Netflix work well on any network, no matter the bandwidth.” Though the percentage of mobile users is small in some markets, it is the majority in others. Temkin and his team are committed capacitymedia.com

in the market, and have plans to expand that to more this year. Our business has continued to invest in India, with local hit shows such as Sacred Games and Lust Stories,” he says. In other countries in Asia Netflix is expanding its presence “both opportunistically and as customer growth warrants” and the local ISPs are focussed on delivering a great viewing experience to their customers, and Temkin says Open Connect enables them to do this.

Data and cloud On the transport and storage side of things, we know that data is becoming too big to move in some instances – a problem that on the surface Netflix doesn’t seem to have on its networks. However, it is an issue on the content production side. “People are often surprised to learn that productions are moved around on digital linear tape (DLT) or portable drive arrays. ‘Never underestimate the throughput of a truck full of tapes’ is just as true today as it was 20 years ago,” says Temkin. Netflix hopes to change that by working with carriers to provide better connectivity to

shooting locations and post-production processing facilities around the world. “8K TV can generate nearly 15Tb of data an hour uncompressed; a day of production could easily generate nearly a half petabyte,” continues Temkin. “Creatives want to be able to see what was shot as soon as possible, often in real-time, and be able to remotely edit a production five or 5,000 miles away.” Like many enterprises, Netflix is no stranger to the cloud ecosystem. “Today, our transcoding is done in the cloud. Having large on-and-off ramps for this data is paramount to our content workflow,” comments Temkin.

Netflix for games The sky appears to be the limit in world of Netflix and the company says that it is constantly evaluating the marketplace to see if there is a great solution to their problem – either that already exists, or that they can help mature. As it gears up for the rest of 2019, the company is exploring where 400G fits into its network. ISPs are also top of the bill, working with them to serve more traffic from an even smaller footprint because more ISPs are concerned with lowering their space and power consumption. “With our ability to serve hundreds of gigabits per second from only a few rack units of space, we’re helping them achieve those goals,” Temkin adds. SDN is also a key area of development for Netflix particularly in its delivery and enterprise networks. He says they are starting to see interesting hardware in that space, and he is “excited that off the shelf network operating systems are reaching maturity”. One of the more exciting possibilities for the company is to enter into the video game streaming arena. A subscription-based game streaming service has been a consumer want for some time now and enterprises are finally starting to pay attention. Other industry players have already began work on their offerings, with Sony deploying PlayStation Now and Google working on its Play Pass product. Recently Microsoft also threw its hat into the ring with its Project xCloud. Apple has also confirmed that it is working on something in this space with users paying a subscription fee to access a list of titles. Microsoft’s CEO Satya Nadella has aptly labelled this vertical as ‘Netflix for games’ so naturally it would make sense to Netflix enter this market themselves and it’s a proposition that might be closer than you think. As Netflix says in a recent letter to shareholders, “We compete with (and lose to) Fortnite more than HBO. ... Our focus is not on Disney+, Amazon or others, but how we can improve our experience for our members.”

It’s Better Within The Sphere. ™

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

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

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

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Live Anti-Fraud Engine

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Live QoS and Bid-On-Live Engine

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

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

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

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

Visit us at www.thesphere.io to learn more

40 |

How to keep Sparkle shining amid the turmoil of TIM Riccardo Delleani came back to run Sparkle in April 2018, six years after leaving. Alan Burkitt-Gray asks him about his investment Capacity plans but also looks at what’s going on in parent company TIM

he new CEO of Sparkle, the international division of what used to be Telecom Italia but is now TIM, is in the final stages of putting together what he calls a “new industrial plan” to the group’s main board. “We’re presenting it at the end of February to the board of directors,” says Riccardo Delleani, who took over the role in April 2018. In fact Delleani has come back to the role he had six years ago. He’s a former chairman and CEO of Sparkle who in 2015 moved within the TIM group to run Olivetti, the former typewriter company that is now its IT and systems integration arm. It’s been a tough few years for any executive in the TIM group, and the instability has affected staff in all divisions, including Sparkle – see panel, right. Delleani came back to Sparkle in 2018 to replace Alessandro Talotta. “I was asked to rejoin Sparkle and my friends,” he says. “I very much liked the idea of seeing what Sparkle was like six years ago and now.” Much is the same as it was, he says. “In terms of portfolio, voice, IP and capacity are

still very important. Mobile platforms and solutions for multinational companies are growing but not as expected. It’s done some innovation, but not – in my view – enough.” This is mildly expressed but a clear criticism of Sparkle’s – and perhaps the group’s – strategies over the past few years, voiced by someone who has continued to work within the group, at Olivetti, until he returned to the wholesale division. Delleani has been at Telecom Italia/TIM for over 30 years, having joined after graduating in electronic engineering at the University of Rome Sapienza. “I looked at various projects – an engineer likes to play with the toy that is the network,” he recalls. “I got into the wholesale business. Telecom Italia had to face issues related to wholesale and related to other licensed operators, dealing with them as the incumbent. We had to take on open access.”

Mediterranean subsea cable Now, he’s hoping the board will approve a number of projects in the emerging industrial plan. “We’re focusing particularly on the Mediterranean region, where Sparkle already

plays a strategic role, and on the Middle East. In the Mediterranean, for example, there is no submarine cable from Sicily to Genoa.” Why’s that important? Sicily competes with Marseille in southern France as a western European landing point for subsea cables from north Africa, the Middle East and Asia. At the moment traffic that lands in Sicily travels the length of Italy to the business and industrial centres of Europe. “This is a project we’re looking at very closely as an alternative to Marseille. The latency for subsea can be lower than that for terrestrial cables.” Sparkle is also expanding its internet presence through new points of presence. Two in Colombia, at Cartagena and Bogotà, are on track, plus one in Nigeria and another in Indonesia. “Many others will come by the end of this year,” says Delleani. “We want to enlarge our footprint.” The new industrial plan “is a work in progress”, he adds. It “will include new products and services. I am in discussions about the new services.” There are two main pillars, he says. First, to serve mobile operators’ needs. “These are not february/march 2019

the big interview: riccardo delleani| 41

1988

Technical engineer, Telecom Italia

1995

Network planning, Telecom Italia

2005

Sales director wholesale, Telecom Italia

2008

SVP wholesale, Telecom Italia

2011

SVP open access, Telecom Italia

2012

CEO, Sparkle

2013

Chairman, Sparkle

2015

CEO, Olivetti

2018

CEO, Sparkle

working with MEF, the former Metro Ethernet Forum that is one of the forces in the development of SD-WAN. “We have good technological expertise and we’re trying to find the right go-to-market solution.”

Seabras-1 and South America What about other new subsea cables, in addition to that one from Sicily? “We are finding the right way to fund them. It’s too early to talk about,” he says. “But we’ve had very good success on Seabras-1 and we are looking at other ideas in South America.” Seabras-1 is the Brazil-US subsea cable system that directly connects São Paulo and Fortaleza to New York. Sparkle operates and manages three fibre pairs on the cable. One of the surprises was that “customers came through that we weren’t expecting”, he says. In the original business plan Sparkle expected “mainly Latin American clients and partners”, but then along came the SAEx cable across the South Atlantic from the Angolan capital of Luanda to Fortaleza. “SAEx brought a new view of the

Sparkle has done Capacity some innovation, but not – in my view – enough” Riccardo Delleani, Sparkle

niche. We’ve had very good success in Brazil with A2P [application-to-person] messaging.” This has been taken up by “lots of corporations”, especially in the banking sector. These are “good for online security procedures”, he notes. “Mobile operators are looking for very high quality and sophisticated routing systems and we see something very interesting there.” These aren’t big numbers and the service is very specific, he accepts, “but it gives mobile operators the opportunity to offer diverse services”.

SD-WAN applications And then there’s SD-WAN (see our special report in this issue). “We’re looking very much as different applications for connectivity to enterprises.” Enterprises have different needs and “all of these flexible solutions are strictly correlated to the capacity of the connectivity,” says Delleani. “You need very flexible capacity.” He adds: “Some operators are working on this but have a very early-stage approach. Sparkle from a technology point of view is very aware of SD-WAN.” The company is capacitymedia.com

infrastructure,” says Delleani. Seabras-1 can now connect North American customers to southern Africa. “South Africa wasn’t our focus and we are very happy that other prospects are coming.” There are widespread reports in the industry about cables from southern Africa across the Indian Ocean direct to Asia. Delleani keeps a careful silence on that. “In two or three years’ time [we can] think about new infrastructure for the African market,” he says guardedly. “The Middle East is something that we are working on,” he says, but doesn’t go into detail. “It’s a very important growth market, where something can change and we have to be ready.”

Solutions for voice What about voice, the old core market for so many international carriers? He describes this as “very old fashioned”. Some regions are declining quickly “with IP taking over” he adds. But in South America, the Middle East and Africa “decline is not so quick”. He adds: “I’m keep to find any solution that can automate this kind of business. Transactions are still done by files and people.” That’s inefficient and Sparkle, like other carriers, needs to get costs down. “Blockchain could do this quickly and efficiently,” he says. “I’m very keen to work with the other operators to use the advantages of this new technology. That would help us with the troubles coming up. Blockchain could give us more robust processes.”

The investors that took on a country and won TIM has been fought over by shareholders that seem to have completely different strategies, and effective control has flipped backwards and forwards. A few years ago Telefónica’s shares passed to Vivendi, the French media company. The Italian government regards TIM, and particularly Sparkle, as having critical infrastructure of national importance that needs to be under Italian control. The government has a stake of around 5% via Cassa Depositi e Prestiti (CDP), the Italian state investment bank, which is also the owner of 50% of Open Fiber, a rival national network. The latest force to exercise power over TIM and Sparkle is Elliott Management, a US-based group of so-called “activist investors” who represent owners of around 9% of the company. Elliott takes on the management of giant companies – and governments. The New Yorker said last year that the founder, Paul Singer, had “developed a

uniquely adversarial, and immensely profitable, way of doing business”. It took on Argentina a few years ago. Elliott bought government bonds with a face value of $617 million for a knock-down price of $117 million – and then, to make the country to pay up, persuaded a Ghanaian court to seize a naval training ship, the Libertad, until it got its money. Elliott’s holding is smaller than Vivendi’s 24%, but it has succeeded in getting its own supporters to dominate the board. In November 2018 Vivendi’s Amos Genish was ousted as group CEO, replaced by Luigi Gubitosi, a former Wind executive who was an Elliott nominee. Since Franco Bernabè resigned as group CEO in October 2013 after six years in office there have been four CEOs. Bernabè’s successor, Marco Patuano, lasted two and a half years. Then there was Flavio Cattaneo, who won compensation of €25 million in return for his resignation after 16 months. He was followed by Genish, in office 14 months, and now we have Gubitosi.

42 |

As wholesale voice declines, Tata builds new markets in digital services Wholesale voice is declining, even in emerging markets, as broadband networks expand. Sumeet Walia, head of Capacity enterprise and carrier services at Tata Communications, is moving the business into new areas, he tells Alan Burkitt-Gray

he government of India’s plan to create 100 smart cities is good news to the ears of Sumeet Walia, who heads enterprise and carrier services at Tata Communications. Especially as for Tata, just as for many other carriers, the traditional business of wholesale voice is in decline. “Anything that touches our home market is interesting,” says Walia. Tata Communications, a division of the vast industrial Tata conglomeration, has built an internet of things (IoT) network using LoRa, the proprietary wireless technology. “It’s a very interesting play for us as we see the development of smart cities,” he says. There are “more and more” companies using IoT and he prefers LoRa “because mobile and cellular IoT have a high drainage of power. With LoRa, you get non-line-of-sight, deeper penetration and a longer device life.” In Tata Communications’ home market “we have constructed a LoRa network for IoT – an India-specific solution – over

the last 18-24 months”. Among the early adopters are government departments. “One of the solutions across industry is for sanitation and garbage collection – plus street lighting to drive more effective use of electricity”.

Smart cities across India That’s why India’s plan to create 100 smart cities excites him. “By the very word ‘smart’ you expect lots of devices.” Tata’s LoRa network is “in 45 cities right now, 100 over a period of time”, he adds. “It’s a service we’ve been building ourselves and taking to market as Tata Communications.” But the company will be working with “other partners to create solutions”, he adds. “And we will offer as a white label solution to others.” The company has “started several services with a couple of customers”, says Walia. “We’re working with governments and enterprises as well. Enterprises themselves are looking at campus solutions.” He lists manufacturing and applications such as health and safety. The involvement of the 150-year-old

Tata Group is significant. “The group chairman Natarajan Chandrasekaran has a One Tata mandate,” says Walia. “There’s an opportunity for us to help companies in the Tata group for digital transformation.” Tata Motors owns Jaguar Land Rover; Tata Global Beverages owns Tetley Tea; Tata Steel operates from the UK – where it bought Corus, the former British Steel – to China. Walia has been in Tata Communications for almost two decades. He was in Tata Internet Services in 2002, when he saw the group buy the Indian government’s international telecoms company, VSNL, and transform it with the addition of companies such as Tyco Global Network in 2004 and Teleglobe in 2005. Walia moved from the former VSNL when it was acquired by the Tata Group back in 2002, as did others from Tata Internet Services. “Since 2002 I’ve had multiple roles in the market.” And Tata Communications and the market have changed too. “As a company we have been shedding skins february/march 2019

the big interview: sumeet walia | 43

1992

Sales manager, HCL

1994

Director, sales, Hughes Telecom

1998

VP, banking, financial services and insurance, Tata Internet Services

2002

VP, enterprise, head of western India, Tata Communications

2005

SVP, enterprise, head of India, Tata Communications

2010

SVP, enterprise, head of India and Asia Pacific, Tata Communications

2015

EVP, global head of enterprise business, Tata Communications

2017

EVP, enterprise and carrier services India, Asia Pacific, Middle East, central Asia, Africa; global voice services; and digital health, Tata Communications

and acquiring new ones,” says Walia. Tata Communications is facing the same transformation challenges as others in the industry. “Most telecoms companies are evolving into a telecomsplus-plus provider. There’s a changing landscape in telcos’ traditional opportunities,” says Walia, who heads enterprise and carrier services in India as well as the Asia Pacific, the Middle East, central Asia and Africa. That means most of Tata Communications activities outside the North American and European markets. “We are front and centre of being a digital infrastructure provider. We’ve gone from being a global network operator to a digital infrastructure operator. We have 700,000km of network,” he says. “The voice business has been on an annual decline.” It’s going to the over-the-top (OTT) providers. “Better technology is available and there’s a better customer experience.” The irony is not lost on any of us: we’re doing this interview via a multi-way Skype call connecting London and capacitymedia.com

Mumbai. Overall, Tata Communications is expecting wholesale voice to decline 5% a year over the next five or six years, but in North America and Europe it’s faster, maybe 6-7½% a year.

Share of a shrinking pie “The Middle East and Africa are declining but not as sharply. That’s the story for us. Growth is going to come from grabbing market share in a shrinking pie.” The focus on the Middle East and Africa works well, as 45% of the 5.4 billion annual voice minutes into India originate in those regions, he says. Meanwhile the market in India itself has been in turmoil over the past few years, after Reliance Jio came into the business with a 4G-only offer at the end of 2015. Some mobile operators have gone out of business and others have merged, leaving the market with a similar number of players to most other countries – instead of the nine or 10 it used to have. “The consolidation was waiting to happen as there were too many operators. The entry of Jio accelerated an eventuality that would have happened anyway,” says Walia. “That has given us a great opportunity.” Capacity But there’s another opportunity – with the OTT players that are soaking up much of the business. “The approach we’re taking for voice is not just a minutes-trading mode but more of a partnership model. The reality is we’re working with OTTs and looking at the termination of their international voice minutes – it’s an interesting space in that sense.” Tata Communications is providing “not just the best cost but quality and tools”. This is inevitable, he says. “In markets like the Middle East there’s been a change in the commercial model, a huge explosion in broadband. This will see a big impact on OTT voice in markets like the Middle East. At the moment they are 10 years behind other markets.” But Tata Communications’ evolution to a global digital network gives it new opportunities. “The shift to digital transformation, using the portfolio we’ve been building, matches what most enterprises and telcos are doing in their own transformation.”

New partnerships in SD-WAN Even traditional enterprise services – such as virtual private networks and international private lines – are being transformed with the arrival and uptake of SD-WANs. “We have our own SD-WAN offer, and we are constantly looking at new partnerships with key players in this

The idea is to nurture new partnerships to construct much needed capacity”

Sumeet Walia, Tata Communications

market. We’re expanding and covering greater territory.” And on all this Walia and his colleagues are building newer services, including data centre services, managed services and managed third party cloud services. “The cloud platform will drive a lot of our future growth,” he adds, while “data centres are being more and more virtualised. On top of this – as people adopt more and more cloud – the need for security is greater and greater. We’ve been building security services with partners around the world.” Tata Communications already has a cyber security centre in Dubai, and “we intend to build further security operations centres in Europe – to help customers comply with the GDPR – and the US. There are further opportunities in the Middle East too.” Why’s that? “The geopolitical environment is volatile in those markets,” he says. “In Saudi Arabia, for example, one of the largest consumers of services is the US Army and Navy. They need the services there.” Tata Communications has acquired Teleena, based in the Netherlands, to boost its IoT activities. “It gives a cross-the-board IoT platform,” he says. The company offers a SIM-based roaming facility and is also an enabler of mobile virtual networks. And Tata Communications partners with a South African company, DTTech, “to create a mobile and IoT platform built on the acquisition of Teleena. It’s a deal we’ve signed and over the next seven or eight months DTTech will be ready to go to market,” says Walia. “Our strength as a company is built on the partnerships we carry. We have a very strong enterprise business and a very strong service provider business as a carriers’ carrier.” He notes how the industry is changing, taking his example from the subsea cable world. In the past when you built cable systems they were capex heavy, he says. “Newer cable systems are getting built and the models are now more partnership led. The idea is to nurture these partnerships to construct much needed capacity.”

Hello! The NTT Communications Global IP Network Opens New PoP in Toronto Capacity

www.gin.ntt.net @GinNTTnet #globalipnetwork #AS2014 #GinTorontoPoP

special report

MOBILE & IOT February/March 2019

CONTENTS 47 Winners revealed at Messaging and SMS Global Awards Capacity looks back at the winners of its 2018 Messaging and SMS Global Awards

48 A smart path to urban happiness Capacity

Middle East smart cities developments are accelarating, but how can carriers get involved?

50 5G â&#x20AC;&#x201C; still a long way to go 5G rollouts will accelerate in 2019, but how close are we to real-life deployments?

54 Big Interview Nader Zein, NEC and ETSIâ&#x20AC;&#x2122;s vice chair of mWT ISG

56 Big Interview Gergely Vadas, head of mobile services at Deutsche Telekom Global Carrier

58 Big interview David Hutton, head of networks, GSMA Technology

60 10 leading 5G projects Capacity roundups 10 of the more recent 5G projects

capacitymedia.com

Capacity

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

sms awards | 47

WINNERS REVEALED AT MESSAGING AND SMS GLOBAL AWARDS

nfobip walked away as the big winners from the Messaging and SMS Global Awards, which was held in conjunction with Messaging and SMS World 2018. The messaging company picked up four gongs at the awards, running for the fourth time, at the ceremony in London’s Tower Hotel. The awards were for Best Messaging API, Best Messaging Innovation – Carrier Solution, Best Anti-fraud Innovation, and Best SMS/A2P Provider for the EMEA region. The awards, which were judged by a panel of expert judges, covered five category areas: Best SMS/A2P Provider, Best Product/Service, Market Innovation, Projects, and Special Recognition. Other big winners include Yuboto,

which took home two awards – one for Best SMS Cloud Provider and one for Best Messaging innovation – Consumer. Capacity Other double winners include C3ntro (Best Messaging Sales Team and Best Carrier Partnership), and Mahindra Comviva (Best Messaging Security Product and Best Messaging Innovation for Enterprise Solution). HGC Global

Winners of the Messaging and SMS Global Awards 2018 Best SMS/A2P Provider EMEA

Infobip

Americas

Identidad Telecom

Global

Vodafone Carrier Services Best Product/Service

Enterprise Product

Airtel Business

Messaging API

Infobip

Security Product

Mahindra Comviva

Cloud Product

Yuboto Market Innovation

Carrier Solution

Infobip

Enterprise Solution

Mahindra Comviva

Consumer Solution

Yuboto

Anti-fraud Innovation

Infobip Special Recognition

Strategic Partnership Messaging Sales Team

HGC C3ntro Telecom Projects

Carrier Partnership

capacitymedia.com

C3ntro Telecom

Communications won an award for Best Strategic Partnership, while Identidad Telecom took home the award for Best SMS/A2P Provider for the Americas. The final category of the night was for the muchlauded Best Global SMS/A2P Provider, and this was picked up by Vodafone Carrier Services. Sophia Simpson, conference producer for Capacity Media, hosted the awards alongside Capacity deputy editor James Pearce. Simpson said: “Congratulations to all of our winners and thank you to all of those who submitted entries this year – we had some excellent submissions. I’d like to thank our sponsors, Infobip and C3ntro Telecom, for their support.” For the full list of winners, check out the table below.

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A smart path to urban happiness

Capacity MIDDLE EASTERN GOVERNMENTS ARE PUTTING THEMSELVES AMONG THE FOREFRONT OF SMART CITY DEVELOPMENTS. HOW CAN CARRIERS GET INVOLVED?

mile and the world smiles with you, goes the well-known self-help saying. This seems applicable to Dubai’s vision for the coming years, with the government putting full steam behind developing a flagship smart city to help fulfil its ambition of creating the “happiest” city on Earth. In line with this, the Smart Dubai initiative has targeted a “happiness rate” of 95 per cent for the city by 2021. While it is arguable whether a figure can really be put on emotions, the direction is clear and reflects how the Middle East as a whole is trying to put itself at the forefront of smart city developments – with multiple governments in the region outlining their digital “visions” for the coming years. These developments open the door for telecoms carriers to help boost this sense of well-being through smart city strategies, while tying together their projects in a variety of up-and-coming areas such as the internet of things (IoT), AI and blockchain. “Telcos are well positioned to drive the smart city through a managed services approach,” says Spyros Salpeas, head of

digital innovation and key customer programmes for the Middle East and Africa at Orange Business Services. “They can offer these services based on an opex model, by creating and investing in the most common, high-cost components of the smart city – infrastructure, cloud and IoT platforms.” One such project is the construction of Dubai’s first integrated smart city in its Silicon Park development, set for completion during the first quarter of the year – an initiative in which du and Orange Business Services have partnered to deliver a full range of smart city services, showing how telcos can be at the centre of such programmes. The 150,000-square-metre area comprises office and commercial space, as well as residential and hotel accommodation, and will feature smart energy, amenities and services, and environmentally sustainable transport. It will also include a central operations centre that will help collect and coordinate all information from the park’s installed devices. Salpeas explains that Orange Business Services has been building its position in

the Middle East over the last decade, playing the role of “master systems integrator” with the region’s smart city operators and governments. Of operators in general, he says: “The smart city space is very active and fragmented, but telcos are well positioned to play the ‘orchestration’ role in this situation.” Along with du, the company is also supporting a programme in Dubai that has been working with 40 start-up companies to drive innovative models in fields such as urban automation, smart transportation and government, and open city data.

Cities of the future There are a whole host of other smart city initiatives in the Middle East, with Saudi Arabia’s futuristic $500 billion NEOM megacity project being among the most ambitious and other governments in the region driving their visions for the future. In another move last July, the government in Oman signed a deal with South Korea to cooperate on developing a smart city in the Special Economic Zone in the port town of Duqm. Aside from the opportunities that such february/march 2019

Image: Adobe Stock

feature: smart city | 49

projects create in a whole host of business verticals, this will all boost the need for extra data, capacity and interconnection. In Oman, Omantel announced a joint venture last summer with data centre provider Equinix to create a carrierneutral hub near the capital Muscat that is expected to open later this year. This will allow carriers, and content and cloud providers to colocate data infrastructure, creating a regional interconnection hub to boost Equinix’s existing presence in Dubai and Abu Dhabi. “For a city to become smart, it needs to be highly interconnected,” says Jeroen Schlosser, managing director for Equinix in the Middle East. “Smart cities require robust digital infrastructure that physically, and most importantly, securely links dispersed sensors, devices and machines that collect and share data, so they can exchange and process information in real time.” He also points out the huge amount of data that the cities of the future could require, considering that some estimate a self-driving car may generate 4 terabytes of data a day. Schlosser explains that Oman has the advantage of also having access to submarine cables that connect AsiaPacific to the Middle East to Europe, opening the pathway to global access. Omantel itself leverages six landing stations in Oman and has investments in 20 subsea cable systems. And getting infrastructure right is seen as key to maximise the opportunity from smart cities. “The networks of carriers will be stretched to the max, and consequently will offer lucrative commercial opportunities for those telcos with the right infrastructure in place,” says Ahmed Abdel-Latif, chief wholesale officer for the Bahrain-based Batelco Group. “Batelco believes that a telco is the best-positioned entity to act as orchestrator of the experience of living in a smart city.” Abdel-Latif says further that the promise of 100Mbps broadband opens the door for massive amounts of data traffic to be aggregated and delivered by wholesale carriers, whether for entertainment, education, health or day-to-day city management – and explains that Batelco has committed to a National Broadband Network programme that will be an enabler to future smart cities. “As more and more demand for data traffic is generated by smart cities, the more appealing the business case for building telco data centres gets,” he adds. Bettina Tratz-Ryan, research VP at Gartner, highlights that one of the key areas where carriers can have an impact is capacitymedia.com

in distributing computing towards the edge of the network, leading to more distributed data centre and cloud requirements. “There is an increasing number of data sets and computing requirements that need to be executed instantly. Carriers will need to shift their focus from delivering connections to scalable and service-aware architectures “

Culture change Tratz-Ryan adds there is a need for carriers to shift to a more agile smart culture to make the most of these projects. “The carrier’s end goal has to be that they can ‘invest’ themselves in the strategy of the city from the beginning, moving from a service provider to an advisor,” she says. “If the carrier is not from the beginning a partner in those projects, it is really difficult to step in ‘after the fact’.” Kuwait-based Zain sought to achieve such agility by making a strategic investment in smart city provider NXN – formerly neXgen – three years ago, leading to the establishment of a specialised business unit to deliver smart city services. NXN CEO Ghazi Atallah says the Capacity company’s independence has allowed it to be nimble, agile and faster to market, helping Zain transition into more of a digital smart service provider aided further by NXN having more than a decade of experience in the market. He points out that it can be a big challenge to move to this new type of model for telcos that simply create an in-house smart city team. “You have to change the DNA, change the culture, and put the right people and technology in place,” he says. He believes this will help Zain move not just towards achieving Kuwait’s 2035 Vision, but also towards growing smart city projects in the region’s other countries. Initiatives that NXN has been developing include a managed security service, a partnership with du for the provision of smart energy services across the UAE, and a partnership focusing on Middle Eastern digital healthcare programmes. Such services allow operators to move up the value chain from the lower revenues from providing connectivity for IoT devices alone, helping to take away the “digital headache” from customers by offering them a much more wide-reaching service, says Atallah. “There is much more value associated with the delivery of the projects, a lot more expertise brought in from a combination of consulting, architecture, experts, software and so on, so you can certainly command a higher gross margin for these types of project.” And aside from revenue alone, carriers

can gain significant insight from the vast volumes of data being created, putting them in a great position to view the market trends and what’s coming next. One of the biggest challenges for smart cities in the Gulf is the sheer scale of the ambition, says Salpeas. “Nowhere in the world have there been smart city projects launched on this scale and with this amount of energy and drive behind them.” But, he says, that gives players such as Orange Business Services great scope for acting as a digital partner to governments and developers. Jitendra Kapoor, an analyst of IDC, says that aside from the government push towards digital in the region, major events such as Expo 2020 in Dubai and the 2022 World Cup in Qatar are helping drive the smart city push. This has been highlighted by Etisalat already making announcements on early 5G deployments to support Dubai’s Expo. Kapoor says carriers have a real chance to seize the opportunity in being at the centre of developing these ecosystems, particularly given the potential insight from the vast quantities of data they have access to. “Being at the centre of the data and IoT ecosystem enables them to leverage this and take them to fullfledged digital service providers going forward,” he says.

City as a platform Players such as Etisalat, NXN and Orange are signatories to industry body the TM Forum’s so-called “city-as-aplatform” manifesto, a set of principles that acts a guide to unite the many large and small organisations involved in each smart city programme – which could help coordinate these multiple parties. Paul Wilson, who is chief marketing officer at the TM Forum, believes that the bigger opportunity will come as the countries in the Middle East launch 5G over the next few years. “This is where smart cities will start to develop more quickly, by deploying IoT capabilities and ultra-reliable low-latency capabilities to assist in infrastructural services such as traffic, water and energy management, alongside a variety of citizen-focused services,” he says. In Dubai and elsewhere in the Middle East, says Zain’s Atallah, smart city plays are being referred to as “lighthouse” projects for other parts of the world – and telcos have a key part to play. “They’re the natural partner, because they typically already have the telecoms infrastructure, which is a fundamental building block for smart city deployments,” he says. “They also have the capability and size to be able to address those kinds of projects.”

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5G â&#x20AC;&#x201C; still a long way to go 5G ROLLOUTS ARE DUE TO ACCELERATE IN 2019 AND QUESTIONS AROUND THE INFRASTRUCTURE Capacity Ç§ Ç¤ Ç§ ÇŤ

appy 2019 â&#x20AC;&#x201C; the year of the pig according to the Chinese calendar. Or, the year of 5G, according to mobile operators. After years of predicting, trailing and developing, official rollouts of the technology are set to begin this year. But how influential will this next evolution of mobile technology be? Roughly speaking 5G is expected to deliver at least ten times the speed of 4G, with improved latency, energy saving, cost reductions, higher system capacity as well as massive device connectivity. As result, it is set to impact a vast number of industry verticals with use cases that include smart vehicles and transport; sensor networks; greater availability of broadband in rural areas and decentralised healthcare, to name a few. â&#x20AC;&#x153;This network will be so responsive that all usages are possible in real time, in virtual reality or in augmented reality,â&#x20AC;? explains Jean-Bernard Willem, SVP marketing and development, Orange International Carriers. â&#x20AC;&#x153;5G will also be a breakthrough network for the internet of things (IoT), able to connect huge numbers of objects with appropriate performance levels for each type of object and its use such as driverless cars, drones, sensors in smart cities, connected

robots in industry or the health sector.â&#x20AC;? Despite the mission critical part operators will play in this new technology, the earliest adopters of 5G according to Hakan Ekmen, CEO of P3 Group, will be enterprises not carriers. â&#x20AC;&#x153;As the majority of wholesale customers are discounters, we do not expect them to be in the first row with specific 5G services. We expect rather industry or large enterprise markets as key customers in the beginning of 5G,â&#x20AC;? he says.

Spectrum The GSMA expects 5G connections to reach 1.1 billion, some 12% of total mobile connections, by the year 2025. It adds that to deploy it, requires a â&#x20AC;&#x153;set of harmonised spectrum bandsâ&#x20AC;? as such, the closer we get to rolling out 5G the greater the pressure on little bit of spectrum we do have. Adam Leach, director of emerging technology at Nominet, calls for changes in the way 5G spectrum is managed, a lesson learned from the days of 3G and 4G. â&#x20AC;&#x153;With 3G and 4G, auctioning off chunks of the mobile spectrum on an exclusive basis proved inefficient,â&#x20AC;? says Leach. â&#x20AC;&#x153;With 4G today, only 48% of the mobile spectrum is ever able to be utilised

at one time â&#x20AC;&#x201C; the same model and approach should be avoided with 5G if we want it to deliver on its promise to be the foundation for a new generation of connected devices and autonomous cars, factories and farms.â&#x20AC;? His suggestion is a sharing model â&#x20AC;&#x153;supported by a database would allow providers access to the full breadth of the spectrumâ&#x20AC;? therefore allowing full use of the network and much improved capacity. Interestingly, Juniper Networksâ&#x20AC;&#x2122; Ian Goetz, chief architect of mobile solutions, says that â&#x20AC;&#x153;initial 5G New Radio builds will focus on adding 5G at 3.5GHz to the existing 4G base station sitesâ&#x20AC;?, resulting he says in base station upgrades and backhaul capacity from 1G to 10G or even 2 Ă&#x2014; 10G.

Infrastructure and fibre We cannot get fibre everywhere, numerous industry figures tell me. With speeds and capacity increasing, copper cabling is proving less and less effective in deliver high-speed internet connectivity, leaving fibre as the best supporting infrastructure for 5G networks. According to International Telecommunications Unionâ&#x20AC;&#x2122;s 2016 report, Trends in Telecommunication Reform, february/march 2019

feature: 5G | 51

Reality check – don’t expect 5G to change your life this year. It just won’t happen”

Image: Adobe Stock

Paul Fawcett, mobility product manager, Maintel

capital investments related to fibre infrastructure are expected to total $144.2 billion between 2014 and 2019, driven largely by the advent of 5G. As 2019 is now upon us, do we now have enough fibre to meet demand? “For now, yes,” says Eric LeCalvez, vice president of global telecom strategic clients and telecom segment of Vertiv in EMEA. “Capacity will need to grow as the gigabit appetite grows. The content providers will want to fortify their market position by making more immersive environments for their consumers.” However, this is still a ways off and will happen in phases. Gaming for example LeCalvez says will move to a cloud native environment between now and 2022, requiring a service latency of under 20ms in order to keep the gamers happy. As for services like IoT, automation and relaunches of AR&VR, towards the year 2025 “the fibre will need to be pushed out further,” he says.

Mobile backhaul One of the key developments to arise over the last 12 months has been the advancement of 5G standards as well as burgeoning 5G wireless backhaul/xHaul. The European Telecommunications Standards Institute (ETSI), through its millimetre Wave Transmission Industry Specification Group (mWT ISG) published its GR mWT 012 report in December 2018, detailing a few prominent 5G backhaul/xHaul scenarios. “ETSI’s document expresses the information needed about backhauling 5G in a clear and comprehensive manner,” comments Willem. “It not only takes into account the challenges and promises expected with 5G, but also provides a very practical way to move forward and help various players plan the future of their businesses.” Adding his thoughts, Goetz says, “Having a wireless or microwave backhaul capability will be of great benefit to 5G as it reduces the need for full fibre and the logistical difficulties that it creates.” mWT ISG aren’t the only ones exploring wireless backhaul, Ericsson and Deutsche Telekom recently completed trials where they achieved transmission speeds of 40Gbps and a capacitymedia.com

round-trip latency of less than 100ms. In general, a change is on the way for mobile backhaul and unsurprisingly, it includes a lot more capacity, but also leverages the likes of SDN and NFV. According to the GSMA report, The 5G Era, 5G will build on the ongoing evolution of 4G with technologies like SDN/NFV, Massive MIMO and carrier aggregation. “There is expected to be a step change in the infrastructure from the current MPLS-based backhaul with a capacity between 100Mbps and 1Gbps, to an evolved network delivery using SDN and NFV technologies, with typical connectivity being at least 10Gbps,” adds Stuart Wallis, head of service providers at MLL Telecom. Perhaps the solution to 5G backhaul lies in more of a hybrid approach, using Capacity both fibre and wireless solutions in tandem. Fibre is still the best option where dark fibre is available or where it is cost-effective to do so but as there are large chunks of spectrum available in the mmWave band, Kashif Hussain, director of wireless solutions at Viavi Solutions, says, “We expect to see more deployments of hybrid fibre and wireless backhaul solutions”.

Overhyped For every few that believe 5G to be game changer, there are just as many who are sceptical about the impact the technology will have. Fundamentally, an argument could be made that 5G is merely a natural progression of its predecessors and that given that many operators are still investing in 4G, 5G is far from on the horizon. Shooting straight from the hip, Paul Fawcett, mobility product manager at Maintel, says “reality check – don’t expect 5G to change your life this year. It just won’t happen.” As far as he’s concerned just like 3G and 4G, 5G has become a bit of a buzzword, and it won’t “magically appear tomorrow” because mobile operators are still investing in it with trial sites just starting to go live. The GSMA forecasts operator revenues to grow at a compound annual growth rate of 2.5% to reach $1.3 trillion in 2025. Nevertheless, Professor William Webb, independent consultant and author of The 5G Myth, is still

apprehensive, saying that while 5G sounds exciting there is still no business case for this technology, leaving operators struggling to get a return on their investment. “5G has been launched with unprecedented hope for its ability to be a game-changing technology. Those who need to pay for 5G – the mobile operators – are struggling to see the business case, says Webb. “They do not anticipate that any new applications that emerge will materially change their revenue, which has been in gentle decline for the last few years.” He goes on to explain that 5G is likely to only be deployed in the denser urban areas to begin with and in the frequencies it will use will only allow for shorter ranges, therefore limiting 5G’s ability to deliver any new and exciting applications that typically rely on widespread coverage. So the jury’s out. While 5G appears to offer limitless opportunities the consensus is we are still not there yet. Lack of a business case, limited technology and ongoing trials mean that while we are closer than ever we’ve still got a ways to go. But don’t lose hope, Fawcett says to watch this space, “5G is coming – but certainly not this year”.

Global deployments In South Korea three of the country’s telecoms operators, SK Telecom, LG Uplus and KT, launched 5G back in December. In India, Reliance Jio said that it plans to provide 5G services in 2020. In the US, AT&T was the first to claim deployment of 5G stateside offering what it calls 5G Evolution but came under heavy scrutiny from its peers as its connected to LTE Advanced towers. While its 5G mobility network will go live in early 2019, with a handset from Samsung expected to launch the network in the first half of the year. In Norway, Telenor is planning rollouts for 2020. Germany’s Deutsche Telekom has already started work on 5G antennae across the country and plans to cover 90% of the country with 5G by 2025. In the UK, EE and Vodafone UK plan to launch 5G in 2019. While Spain’s Telefónica said that it wouldn’t commercially launch 5G before 2020. Mexico’s América Móvil is working towards a 2020 5G release date but said it could come as soon as 2019. In Africa, MTN Group partnered with Ericsson in November to deploy a fixed wireless access 5G site.

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Defining the standards for 5G transport With the imminent advent of 5G, networks will need wireless for backhaul as well as fibre. Nader Zein of ETSI tells Natalie Bannerman how wireless backhaul fits into the wider 5G picture Capacity

t seems obvious, doesn’t it? Increasingly connect mobile networks wirelessly and in the process improve performance and latency. Despite how simple it seems on the surface, a vast amount of research, planning and developing has to go into deploying such innovations in transport networks for 5G mobile services. Nader Zein is at the forefront of 5G developments at the European Telecommunications Standards Institute (ETSI). He is also chief engineer at NEC, but at ETSI he’s vice chair of the Millimetre Wave Transmission Industry Specification Group (mWT ISG). He talks me through the significance of wireless backhaul, “xhaul” in the 5G era – and how the industry at large is preparing for this new technology. Mobile is accelerating rapidly towards 5G deployment. The aim is to develop new business opportunities related to enhanced mobile broadband, ultra-reliable and low latency communications and massive machine-type communications. New radio access network (RAN) architecture, aimed at

delivering higher network efficiency and improved service delivery, also come within the scope of 5G. It is expected that 5G deployments will require increased network density, mainly via small cells. The mWT ISG recently published a report, called GR mWT 012, which highlights the critical role of regulation, licensing and technologies to ease 5G wireless backhaul/xhaul deployments and addresses prominent 5G backhaul/xhaul scenarios. According to the report, 5G will deliver higher capacity, lower latency, improved spectral efficiency, highly accurate synchronisation, advanced networking functionalities and network automation. “Therefore in the medium to long-term, namely from 2020 and beyond, wireless backhaul applications will become even more relevant,” says Zein. The group also discussed innovations in microwave and millimetre wave (mm-wave) technologies, as well as regulation and licensing, he notes. Key recommendations include the availability of more backhaul spectrum and bandwidth, plus band and carrier aggregation, as well as many other

technological developments for 5G. From a regulatory standpoint, proposals included applying regulatory policies and costs in line with the requirements of likely 5G use cases. Zein explains: “The report shows that microwave and millimetre wave transmission technologies are going to continue to play a pivotal role in the 5G era – as they will be fundamental pillars of service providers’ network development strategy to address the future 5G demands.” ETSI is working on specifications for bands above 90GHz. In addition tech with integrated antennas – like those used for phased arrays and flat antennas – need the introduction of new radio requirements, another element ETSI is currently studying. “New mm-wave technology, below and above 100GHz, coupled with the traditional microwave radios are vital for providing the increased capacity and reduced latency for the new 5G services,” says Zein. ETSI isn’t the only standards organisation developing mm-wave requirements. The European Conference of Postal and Telecommunications Administrations has published its recommendations on the new february/march 2019

the big interview: nader zein | 55

1987-90

1996

PhD in communications technology, King’s College London Senior lecturer in communications and signal processing, Lancaster University

2000

Technical manager, NEC

2003

Senior consultant, NEC

2013

Chief engineer, NEC Europe

still managing performance and optimum use of radio access resources,” says Zein. When it comes to transport for xhaul, Zein says that standards are needed for mapping of control and user planes into Ethernet frames for transportation. A number of standards organisations are already exploring this. One interesting claim from the ETSI report is that the current microwave and millimetre wave transmission technologies satisfy the 5G early-stage requirements and that the wireless xhaul technologies will address the 5G mature-stage requirements that will appear later. Zein details early-stage 5G requirements as needing 5Gbps of tail-link capacity in urban and dense urban areas. Suburban and semi-rural areas will need approximately

There is a need to push the envelope of performance in various network segments, including backhaul,Capacity as part of the end-toend 5G network architecture” Nader Zein, ETSI and NEC

bands, including the W-band around 100GHz and the D-band around 150GHz. At the start of the year, Ericsson and Deutsche Telekom collaborated to demonstrate an mm-wave link with transmission speeds of 40Gbps – the first physical implementation of mWT ISG work that is a step towards future 100Gbps speeds beyond the existing 10Gbps. The flexibility of 5G has led to increased interest in the functional split and virtualisation of the RAN – cloud RAN (C-RAN). This has introduced new types of interfaces and transport besides traditional backhaul – with the invention of terms such as “midhaul” and “fronthaul”, aka xhaul. The idea is that wireless transport enables greater flexibility, in particular for sites where fibre is not readily available. Depending on the functional split in the RAN and the mix of services being delivered, various capacity and latency requirements are necessary and new transport architecture is needed. “Many of us are discussing how to relax transport demands, in terms of capacity and latency, when compared to typical fronthaul like common public radio interface, while capacitymedia.com

3Gbps of tail-link capacity and rural areas will need 2Gbps. By the time we get to the mature stage of 5G, urban and dense urban areas will need 5-10 Gbps; suburban and semi-rural areas will need 5Gbps while rural areas will need 3Gbps.

AI and IoT technologies Zein sees xhaul as an enabler of internet of things (IoT) technology, “especially in IoT verticals where a high density of devices is installed”, he says. Xhaul enables efficient and centralised management for dense clusters of devices, such as in factories. “C-RAN deployment, which uses xhaul transport for its realisation, is crucial for small cell and dense deployment of IoT devices and networks,” adds Zein. The adoption of artificial intelligence (AI) into telecoms network management is emerging, especially with software-defined networking (SDN). It is used at the higher layers of the network where network nodes and large amounts of data traffic are generated and transported. Zein predicts the biggest drivers of data in the 5G era will be gaming, social media, augmented reality and vertical services, which will occupy their own domains such as automotive and private networks. “5G networks and systems are becoming hugely complex to manage in conventional network management systems – and it is becoming crucial that AI technology is used for efficient and reliable operation and delivery of diverse services,” adds Zein.

Next-gen IP protocols and 5G services ETSI published its specifications and reports on how to optimise the performance, efficiency and scalability of new 5G services in November 2018. This was its Recommendation for New Transport Technologies. John Grant, chairman of the ETSI next generation protocols group, says that it is important to assess transport technologies because new services such as ultra-reliable low latency (URLLC) will place new demands on transport services and operators have had problems with existing transport protocols in LTE. For example, if a packet is lost on a radio interface it will be retransmitted after a short delay; transmission control protocol will either slow down, thinking the delay is due to congestion in the network, or send its own retransmission, wasting capacity on the radio link. The ETSI document “reports on one possible way to enhance transport layer performance,

using additional packet headers for in-band signalling”, explains Grant. Flexilink is another development described by ETSI in its protocol reports. It is one of the technologies described in Packet Routing Technologies. “It provides a ‘guaranteed’ service for continuous media such as audio and video and a ‘basic’ service for traditional packet data,” says Grant. “This allows the system to be simpler and more efficient than using a single service for both kinds of traffic. The ‘guaranteed’ service provides – as standard – much lower latency than can be achieved in IP networks, as required for URLLC.” He adds: “Both services use much smaller packet headers than in IP, reducing overheads so that more user data can be transmitted, and [they] support multiple addressing schemes. The system has also the potential to be much more secure than an IP network.”

56 |

A new age of mobile end-to-end connectivity Capacity’s Jason McGee-Abe spoke to Gergely Vadas, head of Mobile World at Deutsche Telekom Global Carrier, to find out what Capacity today’s challenges are with IPX, roaming, and messaging

hen deciding whom to interview for our mobile-focussed big interview in this issue, one company immediately sprang to mind. Capacity has reported on a plethora of message-focused Deutsche Telekom international wholesale arm projects, so who better to get an update from than the man who is head of Mobile World at the carrier. Vadas, who has been with the Deutsche Telekom family for nearly 19 years, previously helped to set up the voice trading structure at the company and he also oversaw Asia and the Americas, then the Western Europe, Americas and Africa regions for the voice business. Vadas has been running the mobile services team, also known as Mobile World, for four years. Mobile World manages and sells roaming enablement services (IPX network, signalling for roaming and data roaming), Wi-fi roaming (terrestrial hotspots and inflight connectivity) and messaging solutions. Vadas updates Capacity about how these parts of the portfolio are developing.

Roaming and signalling IPX and signalling were previously seen as “a necessary evil that was quite plain vanilla,” says Vadas. “Over the past few years, the gears have shifted and now we’re looking at new interesting topics. For example, what is very visible from the end-user and retail side is the boom of usage, which is reflected on the signalling side but even more so on the IPX network.” GPRS roaming data use was only an afterthought, he tells me, and everyone tried to use their IPX networks for various services but because of the explosion of roaming data, the needs and requirements for IPX connectivity have gone to a different magnitude. Mobile operators need to ensure end-to-end quality on networks and can’t function effectively today with the legacy setup when IPX networks peer with one another, never usually having more than two touch points, and just being solely focused on their own network. “When these traditional IPX peering settings were originally set up there was no SLA or quality management. Today, we’re kicking off this requirement to ensure that

there is a high level of SLAs across peering partners so that we’re able to actually measure and manage, on an end-to-end basis, regardless of whose IPX network it is,” Vadas tells Capacity. “There is certainly a renewed interest in establishing closer ties to the foreign networks, establishing new connectivity. At the same time, we need to work closer and more collaboratively with the big players, but in a different way.” Traffic growth has exploded but especially in Europe as a result of the EU’s introduction of a ‘roam-like-at-home’ regulation in June 2017. To tackle these traffic surges, the Deutsche Telekom team dramatically increased capacity, upgrading its IPX ports at the Amsterdam Internet Exchange (AMS-IX) to 100Gbps for example and upgrading several customers and peering interconnections to 100Gbps infrastructure. “The technical enablement for roaming covers the IPX network, the development and optimisation on top of that, and it also covers the various types of signalling for international roaming and the data roaming february/march 2019

the big interview: gergely vadas | 57

2007

Head of voice trading Western Europe, Americss and Africa, Deutsche Telekom

2013

Head of international carrier partnerships, Deutsche Telekom

2015

Head of mobile services and carrier partnerships, Duetsche Telekom Global Carrier

“We’re trying to make the Wi-Fi experience similar to the cellular roaming experience where you just turn on when you want to roam. There’s a lot of challenges in this offline-online existence when trying to access Wi-Fi on an airplane but it’s a high priority for us. As more and more airplanes connect to this network, we want to ensure that customers are able to use this service simply and smoothly,” Vadas says. The European Aviation Network, which provides connectivity for passengers and airlines, includes a S-band satellite and around 300 terrestrial LTE base stations scattered across 30 European countries. The network can provide connectivity speeds up to 75Mbps with sub-100ms latency to aircrafts, which can then offer an on-board Wi-fi service to its customers. The market opportunity here is vast. Europe has the busiest airspace traffic in the world, with more than 22,500 flights per day – over 500 million a year. With the completion of the first ever integrated pan-European LTE ground network component the company is now able to fully support EAN’s satellite connectivity and maximise the performance of the EAN system. The network is specifically designed to meet future capacity demands for Capacity connectivity in European airspace, with passenger volumes expected to double in the next 15 years.

IoT on the IPX layer

service itself,” he explains. One recent development here is that Deutsche Telekom Global Carrier has signed a deal with Tele2 Group, which will see the international wholesale arm of Deutsche Telekom provide international signalling services for all of Tele2’s network operations. The company is providing a secure solution via multiple accesses to its global smart IPX network as a way to comply with Tele2’s operational and geo-redundancy requirements. “We are honoured that Tele2 trusts our solution and joined our growing list of partners. It is an important proof point of our roaming enablement strategy. It is highly critical that the technical network is able to support roaming,” says Vadas.

Wi-Fi and in-flight connectivity The Wi-Fi business covers the footprint of the DT affiliates and beyond. It has recently been working on the European Aviation Network (EAN), the in-flight Wi-Fi service that Deutsche Telekom launched with Inmarsat. Vadas’ team is working to provide roaming in this environment and is looking at how it can create Wi-fi-like roaming. capacitymedia.com

Internet of things (IoT) devices are claiming more and more of the usage in the IPX sphere and Deutsche Telekom is a big global player in IoT and collaborative efforts internally are strong to ensure the success of roaming. The company is also actively driving 5G standardisation and its IPX will be there to enable 5G interconnectivity in a new way. “When one looks at the actual usage of IoT devices of the international signalling channels and what happens here, it’s remarkable that all of a sudden the purpose of the network is two-fold,” he says. “IoT is a massive challenge and opportunity to separate these two usages – human and machine.” Human usage has a basic principle when it comes to data roaming, where everything is being home-routed and data traffic always go home to the origin network, but with IoT machines different things come into play.“You cannot afford to have roundtrip delay in this connectivity,” Vadas says. “First of all, you need to identify the type of traffic first, which is a huge challenge when looking at the data volumes on these platforms. And then, very often, you need to handle it differently and peel off the traffic to optimise for latency and different usage. You shouldn’t transport everything in a plain undifferentiated way rather send different types of services to different types of servers

so they can be handled directly and respectively.” IoT on the IPX layer is kicking off different challenges beyond the roam-like-athome boom of data volumes. At the same time, big data has a reinvigorated focus and need now, the Mobile World head tells me. “Four or five years ago, we started looking at big data for analysis and reporting but when it comes to handling the various services differently amid IoT, all of a sudden big data really comes to the fore.” To manage lots of undifferentiated traffic working in a data rich environment is imperative, he tells me, and for three different reasons. “To ensure the quality of your network, establishing a different layer to ensure the user experience is fine-tuned to the different use, and finally, with any of these networks, you need to operate predictably.” “Making the network more dynamic and flexible in this way helps us to identify potential failures and to identify the fluctuation in usage.” This is where big data and predictive analytics is a critical element for Deutsche Telekom Global Carrier. “We have a completely new game plan to approach our IPX network today as a result,” he says.

Messaging & RCS The company’s messaging business is increasingly growing in prominence these days. Traditionally, the focus was with person-to-person (P2P) messaging but over the last few years an application-to-person (A2P) messaging unit was established and closer collaborative ties with T-Mobile affiliates have been forged to monetise the revenue potential with these entities when it comes to A2P and SMS. The IPX network is no longer a niche network and with more services emerging, it has turned into a large, robust and secure dedicated network highway to connect all kinds of mobile ecosystems. As such, Deutsche Telekom is adapting more and more with the IoT world and to areas such as rich communications services (RCS). The A2P business is now very interested in RCS and there is some significant monetisation potential for mobile operators. Despite OTTs launching their own business messaging platforms RCS is a big opportunity to revitalise messaging, particularly with IP messaging, and is a big opportunity for the telecoms market. “We expect business messaging and RCS to really take off this year, as more and more devices with RCS installed are rolled out in our MNO footprint,” adds Vadas. Exciting, but equally challenging times, ahead for the Mobile World team in tackling surging capacity needs and roaming enablement in the era of data and usage.

58 |

Welcome to the 5G era With the first 5G networks now live, James Pearce sat down with GSMA head of networks David Hutton to discuss the impact the next generation of Capacity mobile will have, and the challenges that might slow it down

s 2018 was close to dying out, the first commercial 5G mobile networks were given life. Verizon and AT&T switched on 5G networks in the US before the turn of the year, while all three Korean operators went live with initial, though admittedly limited, 5G deployments simultaneously. Though deployments currently live with a commercial offering can be counted on your hands, this is likely to change rapidly, as more and more mobile operators turn on their 5G offering. In fact, at Mobile World Congress, in Barcelona at the end of February, you may even see your first true 5G mobile phone. Despite this, it is still early days, with most 5G rollouts focussed initially on fixed wireless access (FWA), according to the GSMA – the industry body that represents mobile operators worldwide. According to David Hutton, head of networks at GSMA Technology, those 5G deployments will come in two phases: the first, which has already began in a number of markets, sees operators plugging in a 5G New Radio (5GNR) into an existing 4G

network, running parallel to the existing 4G network. “That means the roaming and interconnect models between different operators remains the same for the time being,” he explains. According to analysis from the GSMA working groups, including the GSMA wholesale agreements and solutions group, that means “wholesale that we have today are able to support the initial 5G rollouts”. That’s just for now, however, with the so-called “phase two” rollouts just around the corner. According to Hutton, standards for this second phase of 5G deployments were agreed upon at the end of 2018, with testing likely to be carried out this year. Deployments are likely to begin in 2020, he says. So what is Phase 2? It is “real” 5G core networks and RAN – ones that aren’t reliant on 4G infrastructure. A network that can stand on its own. “When we start looking at later deployments of 5G, we will see a new 5G core network deployed as well,” he adds. “There’s still some analysis to be done around that on the impact between operators. However the viewpoint at this time is that

the current model of roaming and interconnect will look similar. It may be extended to support 5G.” Hutton has been involved in mobile networks for a number of years. A veteran of Nortel, where he worked on GSM/UMTS product planning and standards, and Vodafone, where he was senior standards strategist for six years, he has been at the GSMA for over seven years. During his time in the industry, he explains, Hutton has seen several generations of mobile technology roll out. The first commercial deployments of 3G were at the beginning of the millennium. 4G followed almost a decade later, with 5G deployments beginning towards the end of 2018. Hutton claims to have never “seen this level of interest around a mobile technology” as he has around 5G.Why? He says the difference is the diversity of use cases that can be made for the fifth generation of mobile connectivity. Use cases range from high bandwidth high throughput in mobile broadband through to massive connectivity for internet of things (IoT) deployments, again “very different to february/march 2019

the big interview: david hutton | 59

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some of the low latency use cases” that the GSMA is seeing. “It is not one size fits all. Because of this, it is targeted towards a lot of different industries,” he adds. “We’ve hit the right time globally and in society in that everything is becoming more digitalised. Industries are transforming as well. This requires they fit very well with what 5G can provide. So there is a huge industry interest and demand for this type of technology – 5G satisfies that.”

Challenges One of the drivers for this is industry, but another key aspect to the acceleration of 5G deployments has been the support and determination of national governments to be seen as leaders in mobile technology. The industry is under pressure to deliver a strong 5G deployment in a number of marks. Hutton explains: “Geopolitically, a lot of governments are interested in being seen as embracing 5G and positioning themselves as leaders in this technology. So you have consumers who are interested, operators who are looking at it as a way to improve capacity in their existing infrastructures as well as the capacitymedia.com

new opportunities it provides to engage with industries and new verticals, and also the governments who are looking to drive forward and transform their societies and economies as well – embracing the whole digital societies.” However, government interest doesn’t always mean the same as government help or support. In fact, a common message from the GSMA over recent years has been on mobile spectrum or, more specifically, the shortage of it. Connecting more people requires more bandwidth, but in most markets regulators or government bodies dictate the amount of spectrum that is made available to each industry, mobile, satellite, broadcast or other. Governments often opt for auctions, selling spectrum to the highest bidders, and this costs the industry a small fortune – money that could be directed to deploying more masts or improving the backhaul infrastructure needed to support faster connectivity. In November, the GSMA called on regulators to make available 80-100MHz of contiguous spectrum per operator in prime 5G mid-bands (such as 3.5GHz) and around 1GHz per operator in millimetre wave bands (above 24 GHz). “Within the GSMA, we have a spectrum Capacity team who works very hard to do a lot of advocacy with governments and regulators to make sure there is enough spectrum allocated to operators worldwide, and making sure the methods for allocation are the right ones. When we talk about potential performance of 5G it is related to ensuring that the relevant amount of spectrum is allocated and is utilised to provide that performance. If we don’t get that then you won’t get the performance that 5G promises. We are advocating for more spectrum not just for 5G but also for previous generations.” The GSMA sees this as important because “spectrum is the oxygen which the mobile network breathes and lives”, explains Hutton. In terms of alternatives to more spectrum, carrier aggregation, which combines different bandwidths into different spectrum bands and even across different generations, could boost both capacity and performance. “With early 5G deployments (5G NR in 4G networks) you have dual connectivity, so the device is connected to both 4G and 5G at the same time,” he adds. “This means you can utilise the spectrum on both 4G and 5G at the same time. You can also use carrier aggregation across different bands.” As we speak, Hutton is joined on the call by his colleague Michele Zarri, who is a technical director for the GSMA specialising in this area, and Mona Mustapha, a technical specialist with expertise in the field of IoT. On spectrum, Zarri adds: “There is an opportunity for refarming. If you look at the efficiency for GSM to transfer 1MB it takes a couple of minutes but with 4G it takes a

fraction of a second. So if you can use the spectrum allocated to 2G for 4G and 5G it can improve the capacity quite a lot. Unfortunately in some parts of the world this flexibility is not there yet, so that is something the GSMA is working on. “Some 5G will be able to be deployed in the same band that 4G is deployed in so that will make more efficient 5G spectrum available in the last few years.” This greater need for spectrum is even more apparent when you consider the potential impact of the internet of things. GSMA intelligence figures shows that there are around 1 billion cellular IoT devices in use already. Ericsson predicts 29 billion connected devices will be in use by 2022 – around 18 billion of which will be IoT. With so many devices on top of more cell phones than ever, spectrum will become even more of a commodity. According to Mustapha, the variety of IoT solutions means the impact will vary greatly. She explains: “In terms of capacity, IoT devices have many different use cases and some of them may only need a small amount of data and sometimes infrequently. So even though the number [of devices] seems quite huge, the actual bandwidth needed isn’t going to be all that great for IoT devices. “We’re looking at technologies such as NB-IoT and LTE-M that will be able to help support all of these devices.” Another consideration is backhaul and fronthaul. Changing from a distributed RAN model to a cloud RAN creates the need for another high capacity link between a virtualised baseband unit and the actual antennas. Zarri explains: “As part of our future networks programme we have one activity which is looking at backhaul optimisation, but there is also a major problem with fronthaul. We estimate a normal 5G site will need a 10Gbps connection which can be achieved with microwave links and E-band, but most likely we require fibre to overcome this.” Fibre, of course, isn’t always cheap or easy to deploy, especially in urban areas. To resolve this, the GSMA has begun to look at some of the available alternatives. “We are looking at how some of the technologies that have been started can mitigate the requirement of having fibre everywhere. We expect fibre deployments to continue to grow, but the deployment of FWA make us think that there will ultimately solutions that rely on 5G itself to backhaul in situations where 5G is too expensive. “Other solutions include using more edge computing – moving more applications to the edge of the network – which mitigates the backhaul problem but that’s very much a case-by-case study. It is problem but we are taking the right steps to address it, but there is no doubt you need big pipes to connect this much network.

60 | 10 leading 5G projects

10 leading P

projects

rojects are the cornerstone of any new technological advancement. They allow us to discover new use cases, fine tune standards and test technologies in real-life environments. 5G is no exception. Through the various global field trials, we see first-hand the applications of the mobile technology for the end user and have a better understanding of its limits and benefits. Given that 5G has been some ten years in the making, there are too many projects to include them all in our list, but here are ten of the more recent ones, covering new ground in the 5G space.

China Unicom and Huawei: 5G network slicing

China Unicom and Huawei entered into a joint agreement to research the application of 5G network slicing. The project will have a particular focus on key technologies and solutions for China Unicom’s 5G network slicing services and applications as well as jointly promote industry chain development, and applying slices to different industry verticals such VR/AR gaming and the internet of things. “We hope that both parties can jointly build a new 5G slicing ecosystem in 2018 and 2019,” said Zhang Yong, president of China Unicom network technology research institute. ICON Scissors.

Capacity Deutsche Telekom and Crown Castle: Edge computing trials with 5G

NTT DoCoMo and Huawei: 5G field trial Japan

NTT DoCoMo and Mitsubishi Electric: 5G automotive field trial

Deutsche Telekom launched an edge-computing lab in the US in collaboration with Crown Castle, the tower and fibre provider. The project called Living Edge Lab is an ultra-low latency mobile testbed, which has been launched at three sites on-premise at Carnegie Mellon University, Pittsburgh. Deutsche Telekom says that the testbed combines a fully softwarised network with a modular RAN platform. The wireless access in the 3.5GHz band uses advanced LTE and 5G features such as massive MIMO, active antenna systems and beamforming technology.

NTT DOCOMO and Huawei are developing what it calls the “world’s earliest and most high-profile 5G launches” aiming for commercial deployment in time for the 2020 summer Olympics in Tokyo. During a large-scale field trial of 5G on the C-band in Japan, the two companies verified 5G NR technologies by developing a macro cell that comprises a C band base station with 200MHz bandwidth, massive MIMO and f-OFDM. The tests took place at the Yokohama media tower achieving an average user throughput of 11.29Gbps with 24 layers.

NTT DoCoMo achieved a maximum speed of 27Gbps in a 5G automotive proof of concept it carried out with Mitsubishi Electric. The trial took place in Kamakura, south of Tokyo, using a single mobile 5G terminal on a moving vehicle over communication distances of 10m and 100m, achieving 27Gbps and 25Gbps respectively, using the 28GHz radio frequency. Base-station antennas were installed on the wall of a building directed beams to mobile-terminal antennas installed on the rooftop of a moving vehicle. february/march 2019

10 leading 5G projects | 61

PLDT and Ericsson: 5G pilot network in the Philippines

SEE, O2 and Three: Fibre ring in London

SK Telecom and Samsung: 5G for enterprise

STC and Cisco: 5G technologies in Saudi Arabia

Telia, Nokia and Intel: 5G manufacturing trials

Verizon, Nokia and Qualcomm: 5G calling trial

capacitymedia.com

Ericsson and PLDT subsidiary, Smart Communications signed a memorandum of understanding in August 2018, to develop 5G technology in the Philippines. Under the terms of the agreement, the two will deploy a 5G pilot network in Luzon, the biggest and most populated island in the Philippines, which is due to go live in early 2019. The pilot will use Ericsson’s 5G Radio Access Network, core and transport solutions, allowing Smart Communications to exploren industry partnerships and further develop 5G innovations.

SSE Enterprise Telecoms, Three UK and Telefónica’s O2 have agreed to build a 5G fibre ring in London. SSE is to build the London network for both Three and O2; using fibre largely installed in Thames Water’s wastewater sewers in the capital. SSE said the fibre ring would “significantly enhance Three UK and O2’s connectivity backhaul capabilities and pave the way for further 4G and 5G deployment by connecting cell sites and masts”. “Networks will underpin the UK’s digital economy and are essential to 5G services,” said Colin Sempill, managing director at SSE.

In September, SK Telecom was one of three operators in South Korea to go live with commercial 5G services. Prior to that, the telco was working closely with Samsung to research and develop 5G, specifically in mobility enhancement for 3.5GHz and 28GHz millimetre-wave spectrum bands, widen coverage, and enhance 5G use cases. Capacity During the trial the two developed a 3.5GHz 5G end-to-end networkmade up of a 5G virtualised core, virtualised RAN, a distributed unit and test device - based on the 3GPP 5G New Radio standards.

Saudi Telecom Company and Cisco are working together on the development of 5G communications and networks in Saudi Arabia. Cisco will work closely with STC on its architectural transformation to develop the commercial potential of 5G mobile networks. STC will be able to provide advanced network services, such as lowlatency, which will also act as a key differentiator for the company. The collaboration between the two will support STC’s transition into a digital service provider, as well as to assist the company in delivering Saudi Arabia’s 2030 Vision and National Transformation Plan.

Telia, Nokia and Intel successfully carried out an industrial trial in March using 5G to improve the time sensitive applications and enhance productions in manufacturing. Using 5G, operators and businesses are able to connect assets and take advantage of new capabilities such as machine learning, artificial intelligence, and automation to transform operations. Nokia and Intel worked with Finnish software start up, Finwe at the Nokia base station Conscious Factory in Oulu, using a trial 5G radio access network operating in the 28GHz frequency band.

Verizon trialled over-the-air calls using a 3GPP-compliant 5G New Radio making it the first operator to demonstrate the new technology. Verizon partnered with Nokia and Qualcomm to trial the calls using millimetre wave spectrum. It was carried out at Nokia’s New Jersey test facility, using the Finnish vendor’s 5G network technology on a prototype device that was supplied by Qualcomm to make a test call. “With this first 3GPP NR standards-based connection, Verizon continues to lead the development of 5G technology,” said Ed Chan.

62 | SPONSORED STATEMENT

STC ANNOUNCES KEY NEW PARTNERSHIPS All International Carriers, Cloud and Content providers are able to connect with each other in MG1 (MENA Gateway), where they will have access to KSAs leading International Internet Exchange and the ability to access KSA via STC infrastructure and international submarine/terrestrial networks.

Benefits of joining JED IX in MG1 will include: • LINX’s 25 years of experience running neutral IXPs, which will add value to the largest GCC market. • The exchange will be built using a disaggregated platform, just like LINX’s LON2 network in London

Capacity

• Jeddah is one of the main landing stations for African, Asian and Regional submarine and terrestrial cable routes • Saudi Arabia itself has many ASNs which would benefit from joining JED IX as it will enable them to keep their traffic local

STC and LINX Partnership STC are proud to announce that in December 2018, LINX and Saudi Telecom Company (STC) entered into a strategic partnership to form a new Internet exchange point in Jeddah called JED IX. JED IX, powered by LINX, is built on a fully redundant switching platform located in a neutral secure STC data center, known as MG1 (MENA Gateway). It is a neutral Internet traffic exchange platform, that will link global networks, network operators and content providers from right across the MENA region. STC, Saudi’s incumbent operator and the largest operator in the MENA region, has pledged that the new partnership with LINX will help deliver on its mandate to establish Saudi Arabia as the key hub for telecoms connectivity in the area, as part of its Saudi Vision 2030. “STC’s ambition is to develop JED IX into the leading Internet and data hub in the MENA region. In LINX we have a global leading IX partner who will help accelerate the delivery of this ambition and create a thriving interconnection eco system in the Kingdom.” - Alan Whelan, VP of STC Wholesale “The new partnership between LINX and STC forms an exciting milestone in the expansion of LINX global presence and builds on LINX’s aim of ‘Working for the Good of the Internet’ globally”. Kurtis Lindqvist, CMO of LINX.

capacity

• The MG1 (MENA Gateway) data center is operated by STC. Networks will be able to connect to the exchange remotely via the STC landing stations, once LINX ConneXions partners are present at JED IX. Please note that while JED-IX is not yet live, enquiries are being taken at JEDIX-info@stc.com.sa, where we request you to complete the following fields: Contact; Company name; Email; Phone; Enquiry details. New STC Branch Office Opens in DIFC Dubai. STC are pleased to announce that as part of its ongoing International Growth Strategy STC has opened a new Branch office in DIFC Dubai. Our aim is to constantly improve our client relationships and ease our customers’ ability to interact with STC on a regular basis. The new office will give our International clients the ability to build on existing relationships with STC while giving new clients the opportunity to meet with us in Dubai. Dubai has been chosen for our new Branch Office due to it being a popular place where many of our respective clients have established their branch offices. STC are always please to improve communications with our clients and believes bringing its services closer to our users will help us forge new relationships and improve existing ones. STC look forward to meeting with you at a number of customer events we plan to hold in Dubai during 2019.

february/march 2019

special report

ENTERPRISE & WAN

February/March 2019

CONTENTS 65 Aryaka case study JAS Expedites SaaS Application Delivery with Aryaka

66 Software defining future Enterprises are looking at SD-WAN services as their solution of choice, says Jean Critcher of Orange Business Services

Capacity

68 Meeting enterprise needs Many carriers are looking to move up the stack and extend their enterprise business, with their own SD-WAN platform

70 Ten projects to watch As SD-WAN projects reach the market, we pick 10 of them to watch around the world, including a 20-carrier global alliance

72 Are you digital ready? Are enterprises ready for digital transformation? Vodafone spoke to companies and puts some numbers on their digital adoption plans

capacitymedia.com

Infrastructure is in Retelit’s DNA

Retelit’s head of international business unit Giuseppe Sini talks about the Italian company’s plans for new routes in 2019

For Italian telco Retelit, 2019 is set to be a signiﬁcant year of change. That was the view of head of international business unit Giuseppe Sini as he chatted with Capacity about what to expect from the company over the next twelve months.

Giuseppe Sini, head of Retelit International BU

New Year, new routes 2019 will see even more expansion as Retelit continues to consolidate itself as the alternative route-provider of choice. The ﬁrst of these, Sini says, will be the lowest latency offering between Hong Kong and Frankfurt – two key international and ﬁnancial hubs.

2018 saw Retelit take significant steps to move from its role as an Italian infrastructure provider into a position of being a key player in Mediterranean connectivity. Key to this, and to Retelit’s internatio- The route will run along AAE-1 to Bari, then up to Frankfurt, Gernal business, is its stake in the AAE-1 subsea cable system, Sini many, with lower latencies than existing routes which are primarily explains. terrestrial. Capacity “In 2014 we made a key investment in AAE-1 cable. The market was a strange vision of us because we are a relatively small provider. This was one of our main investments, which has now more than fully paid off. Thanks to this we began to see this vision of becoming a landing provider for the big content providers.” Retelit’s portion of the 25,000km AAE-1 cable, which connects 19 countries from Asia to Europe via Africa, is almost “completely in use” according to Sini, because of Retelit’s high level of provisioning and open network services. The main drivers? Demand from the OTTs has played a key role in the company’s success, he explains, and notable demand for services connecting into the East. AAE-1 links into Hong Kong, Vietnam, Cambodia, Malaysia, Singapore, Thailand, Myanmar, as well as several Middle Eastern countries, and growing demand for connectivity there has been substantial. “We positioned ourselves in the same we had previously: as a flexible provider, with high quality service and a strong alternative to traditional routes. We provided a new route in Bari to land in the Med. Then we created a platform to land in the Med in Palermo through a new PoP in Sicily.” This success, adds Sini, has allowed Retelit to expand its footprint, most notably adding a new point of presence in Marseille, and to take capacity on a number of other subsea cable systems. The reason? To offer more diverse routes. “In 2018 we consolidated this presence by opening new services at our traditional carrier level, offering the best latency services from Hong Kong to Frankfurt using our assets. It is Hong Kong through AAE-1 to Bari, and then onward to Frankfurt. So we can provide transport to carriers, OTTs and financial services, because of the low latency services they require.”

Explains Sini: “We will be announcing even more in 2019, including the opening of a PoP in Hong Kong in partnership with a local partner, to view not only this kind of services but also to terminate in the local market, and offer our value added services on the IP side. Providing pipes on the IP side directly connecting Europe to Hong Kong, giving cloud connectivity that enable companies to use their applications with low latency and specific routing from Europe to Hong Kong and Singapore.” The new route means financial services companies will have access to the low latencies need for FX trading, he adds. This route will play a key role in Retelit’s 2019 plans. Retelit will also cast an eye towards the US, with plans for New York also on the horizon. He said: “It gives us the possibility to collect and deliver this traffic in New York. In 2019, we’ll see the consolidation of our strategy to be the centre of the Med but also a the centre of Europe by delivering these kinds of services to the US. We will offer a high quality alternative to the market by providing something new that doesn’t already exist. We will not just follow the demand of the OTTs but anticipate their needs to offer new and diverse routes.” So why partner with Retelit? Sini says it is a simple choice – the company’s size and agility means it can pre-empt the demands of the OTTs and carrier community to offer a flexible service. He concludes: “We are providing services that are perfect to enable the usage of applications stored in the data centre. 2019 will see the next step forward for Retelit. We will use technology led networks and open networks – using multiple cable systems – offering at a service level a strong product. This is something that the market is calling for, and it is new – it doesn’t exist from anyone else – to be flexible, small, but fast, delivering a high quality service, because infrastructure is in our DNA.”

case study: aryaka | 65

JAS EXPEDITES SAAS APPLICATION DELIVERY WITH ARYAKA

AS Forwarding Worldwide, a leading global freight forwarder and logistics provider, sought to streamline their logistics management processes using CargoWise One, a SaaS application that the ces company deployed in over 240 of its offices worldwide. When JAS initially deployed CargoWise One over the public Internet, it resulted in poor application performance and frustrated end users. Degradation in the performance of this mission-critical tion application was unacceptable, as application delays and failures directly impacted employee productivity and business d for execution. With rapid expansion planned the future and a global workforce to T maintain, JAS Forwarding Worldwide’s IT leaders went in search of another solution.

“We were quite concerned about the investment needed to build this type of high-speed network. In addition to improving application performance, we wanted a fully managed service. This is what we got with Aryaka. Now we have a reliable network with global management built into it and a support staff on demand.” Mark Baker, CIO, JAS Forwarding Worldwide The Solution When comparing solutions, the company first looked at MPLS, but concluded that the legacy technology had a number of drawbacks: MPLS is very expensive, lacks cloud and SaaS connectivity, and takes too long to deploy. The latter was particularly problematic considering the large number of offices the company maintains. The company also needed the flexibility to

Capacity Aryaka’s Software-Defined Private Network

We were quite concerned about the investment needed to build this type of high-speed network. In addition to improving application performance, we wanted a fully managed service. This is what we got with Aryaka. Now we have a reliable network with global management built into it and a support staff on demand.” Mark Baker, CIO, JAS Forwarding Worldwide

quickly add network connectivity to new offices. Instead, JAS turned to Aryaka, for its SmartCONNECT SD-WAN as a Service, which delivers application acceleration to any device and any application, anywhere in the world

through a global private network with built-in WAN Optimisation. Aryaka’s network can be deployed to new locations in hours, compared to MPLS in weeks or months, with Multi-cloud connectivity, SaaS acceleration - all with zero CapEx.

RESULTS Company Profile Industry: Freight Forwarding and Logistics Company Size: 3,700 employees Headquarters: Atlanta, GA

capacitymedia.com

66 |

Software defining the future of the enterprise market Enterprises are increasingly looking at SD-WAN as their solution of choice, with more carriers entering the market. Jean Critcher, of Capacity Orange Business Services, says carriers shouldn’t be afraid of the move away from traditional MPLS

emand for software-defined wide area networking (SD-WAN) among enterprises is booming. Don’t believe me? Let’s look at some figures. According to IDC, this segment will hit around $4.5 billion in revenue by 2022, having grown at a compound annual growth rate of 40.4% between 2017 and 2022. In 2017, the last available figures, SD-WAN infrastructure revenues increased by 83.3% reaching $833 million. Much of this growth is being driven by the need for more flexible networking. For global telecoms, this serves as both a threat and also as an opportunity. Enterprise remains the “golden goose” to many telcos, with the opportunity to sell a wide range of value added services that can greatly increase profit margins. It is also highly competitive. Orange Business Services (OBS), which is the enterprise services arm of French giant Orange, is some way down its own SDWAN journey, offering the services to its enterprise customers which range from smaller units to some significant

multinational companies. Jean Critcher, Head of Solution Consulting, Global Solutions at OBS, tells me that Orange has seen a lot of traction with SD-WAN over the last few years, with more companies turning to it as a significant part of their networking solution. But sometimes, it isn’t actually SD-WAN itself that enterprises are looking at. Critcher explains: “I’ve sat with more than 30 customers this past year, either in workshops or in meetings, who have said they want to do SD-WAN, but once you dig down into what they want to do with it, you realise 7/10 times that SD-WAN means using MPLS to all internet.” The question her team then puts to the customer is “how do you plan to use SD-WAN in your network?” A lot don’t have an immediate answer, she adds. “A good example is with a customer we have today, after nine months of discussion, is that they really want to be able to measure end-user productivity,” she says. “They don’t want to prove SD-WAN technology works, they want to see how it improves things for them. What are the benefits? For them, the

vendor discussion wasn’t even relevant. It was about seeing actual improvements on both the IT and business side, and how it helps them meet key KPIs.” So what are the main drivers behind SD-WAN adoption. I suggest cost reduction, which has been one traditional concern. MPLS, after all, can be quite expensive, especially when compared with running a lot of applications over the internet. Cost reduction, Critcher replies, is “becoming less relevant” in these discussions. “There is much more of a focus on what they intend to do with SD-WAN. When technology comes up, it is more often a question of what improvements they will see and how Orange is going to make that work. Those are the discussion points.” Are the margins good for Orange? Critcher won’t give me numbers but, as she points out, they range massively based on the deployment. Orange offers significant transport services for enterprises, but also offers overlay and value-added services too. It does this through a number of vendor partnerships. On SD-WAN specifically, OBS is working with Juniper Networks, Riverbed, february/march 2019

the big interview: jean critcher | 67

1990

Office systems engineer, US Army Corps

1996

Software engineer, UPS

1996

President/owner, The Savvy Netizen

2001

Senior product manager, IPVPN, VoIP, IPSec, OBS

2012

Head of APM and infrastructure management services, Orange Business Services

2015

Head of integration services, Orange Business Services

2018

Head of solution consulting, digital enablement and digital inside solutions, Orange Business Services

Infovista and Cisco VIPtela. If an enterprise wants another partner, Orange will look at what the business needs and if it already has an option before adding more. The vendor market is driving SD-WAN but it is also an ever evolving market. Critcher explains: “Last year we saw around 40 different vendors in the space – some are very recognisable, while others have been the subject of acquisitions. There aren’t necessarily more vendors entering this space, but some are finding their niche before getting acquired. Take Cisco’s acquisition of VIPtela. “They could integrate this with their existing platform without losing traction. That was their strategy,” she adds. “Other players like Oracle or VMware snapping up players like Talari and Velocloud have seen that if they play from the data centre point of view, which is where customers are now beginning to downsize data centres and move everything to the cloud, the reasoning is not to lose a stronghold and offer the capabilities in software and virtualised services as data centres change. They themselves can potentially become another Amazon Web capacitymedia.com

Services – this technology allows them to answer the SD-WAN needs as their customers are evolving.” Service providers “want to capitalise on the same thing” by being able “to virtualise these capabilities on the existing infrastructure. They are also looking to be seen as a cloud provider as customers move away from old data centre models by offering the ability to host and manage services for our customers through our partners, says Critcher. “Then the licencing cost comes into play, and that is where having strong relationships with our vendor partners comes into play.” So back to margins. These vary so much on the business case. Costs for one time charges and cost of licencing models are “where customers squeeze the most” she claims. “One time charges we have to explain and articulate the value customers will see from deploying an SD-WAN network with Orange. We give them so many different options of setting up their network and getting that built.”

Deployments Orange has had a number of notable deployments for SD-WAN but the most talked about in all of the conversations I’ve had with members of the OBS team is its Capacity deployment with Siemens, the German industrial giant. Siemens is a global powerhouse positioned along the electrification value chain – from power generation, transmission and distribution to smart grid solutions and the efficient application of electrical energy, as well as medical imaging and laboratory diagnostics. It has subsidiaries all over the world, and the company was looking to move towards an internet-driven SDN platform to support its 1,500 sites, spanning 94 countries. The deployment is ongoing, but the Internet-based SDN and Universal CPE rollout has already helped the industry giant to enhance its capability and scalability whilst also enhancing reliability and security. Critcher tells me: “With Siemens, we were scared to death of giving away MPLS because the customer wanted to go all internet. It was our CEO in that conversation who said okay, we’re with you. If you go all internet, we’re with you. We made these decisions almost two years ago because we realised that if we didn’t we wouldn’t get the bigger deals.” This is the crux of a challenge facing a lot of carriers who are contemplating an SD-WAN offering. The demand for it is there, clearly, but some deployments will be hybrid, and some will be pure internet-based. If you are a global infrastructure provider, or a company with a history of being the supplier of the big, fat data pipe, what can you offer when a customer comes to you and says they don’t actually want to use your infrastructure – your bread and butter? For Orange, it has been a learning curve.

OBS has been around since 2006, forming as a rebrand of existing businesses Equant and Wanadoo. Despite this, SD-WAN is still new, says Critcher: “We have a considerable amount of experience and a lot more than we did last year. We’re also now not afraid of not being the transport provider. We have a number of deployments where we provide no transport services whatsoever. “We’ve made some significant deals across all types of models, from traditional underlay models to ones where we offer the overlay, and some where we don’t even provide transport services.” So what is Orange providing in this case? Overlay and value-added services. I want to know how that discussion first went – how Orange went from being an infrastructure company to being a services company. OBS first had the chance to just do overlay for a customer at the end of 2016 when a large German chemical manufacturer went out to the market, Critcher explains. “They said they were looking to change how they do things, but wanted a provider who could offer other value-added services, even if we looked elsewhere for connectivity options.” When they took that on, the agreement had to be made from C-level down and “we had numerous customer workshops to make sure we hadeverything covered, including UC and the SD-WAN piece”, she adds. “We were already prepared for the fact that we might not win the connectivity tender. We won the part of the tender with no connectivity – one fourth of the actual contract value. It was a half a billion contract with this customer – 100 million is going to the underlay providers. We’re still delivering on this project because it is enormous – more than 1,000 sites – and the scope on the connectivity keeps growing. We add nothing but overlay and UC services. We were quite happy to take that, and it was a starting point for us, because prior to this we were focussed on providing connectivity as well.” Transport contracts get squeezed year on year with customers expecting to see cheaper access and lower equipment costs across a five year contract. “All of these revenues are decreasing unless we add services.” Is this a strategy she’d recommend to other carriers looking to offer an SD-WAN service? That, she says, depends purely upon their experience level. “We had already been doing integration models for more than 10-15 years,” she says, pointing to WAN optimisation as an example. “If carriers have that kind of experience of a multi-source integration model then they shouldn’t be averse to giving up the connectivity. If they don’t have that experience and want to take that risk, that’s up to them, but we have the confidence to do this because we have experience outside of just network transport. It gave us the chance to really put that out there.”

68 |

Capacity

Meeting enterprise needs MANY CARRIERS ARE LOOKING TO MOVE UP THE STACK AND EXTEND THEIR ENTERPRISE BUSINESS. SOME ARE BASING THIS MOVE AROUND THE DEVELOPMENT OF THEIR OWN Ç§ Ç¤ GUY MATTHEWS Ç§ OPPORTUNITY BEING OFFERED BY THE ENTERPRISE SECTOR

nterprise has always been an attractive opportunity for carriers. Services command a higher price than in wholesale, and there is a near bottomless reservoir of customers to go after. Enterprise business also offers better prospects for moving up the value chain with a variety of managed services. â&#x20AC;&#x153;With increased competitive pressure and low differentiation in connectivity services, carriers are realising that they need to expand deeper into the value stack and offer additional services,â&#x20AC;? points out David Noguer Bau, service provider director at Juniper Networks. â&#x20AC;&#x153;This includes features such as managed security, managed LAN, managed DC, and software-as-a-service (SaaS).

In order to accomplish this, they are launching enterprise divisions.â&#x20AC;? To this end, he says, many carriers are moving to a platform-based approach that will enable them to standardise their service offering and to enjoy the economies of scale and automation that they typically apply to their services. Software-defined wide area network (SD-WAN) solutions, believes Noguer Bau, provide an ideal self-managed service for enterprises who want to manage their connectivity across branches. â&#x20AC;&#x153;We believe carriers should invest in a service delivery platform for enterprises that incorporates managed SD-WAN services.â&#x20AC;? Many carriers are now embracing

SD-WAN as the perfect way to build value into their enterprise offer. Peter Coppens, VP product at Colt Technology Services, claims the carrier spotted the opportunity early. â&#x20AC;&#x153;Colt launched an SD-WAN service in October 2016,â&#x20AC;? he says. â&#x20AC;&#x153;Currently we have a number of large enterprises running their live WANs on Colt SD WAN. The types of customers vary from a main bank in Europe to a luxury consumer brand. As a lot of enterprises are looking to make their managed WAN services more cost effective, more agile and have the ability to deliver higher bandwidths, so there is a huge opportunity in enterprise for us.â&#x20AC;? The biggest advantage to SD-WAN is that it provides end-to-end control over february/march 2019

Image: Adobe Stock

feature: sd-wan | 69

services to the customer premises, argues Tom Adams, director of product at colo and managed service provider Cogeco Peer 1. “This agility allows carriers to complete service requests almost instantly, in a location-agnostic fashion and in days rather than months,” he adds. “This is the main reason carriers are flocking to SD-WAN.” One of the strengths of an SD-WAN offer is that it is marketable to smaller enterprises as well as large, to public as well as private sector. Verizon, for example, is addressing the smaller enterprise opportunity through its Verizon Business Markets division. Last year it launched into SD-WAN by teaming up with vendor Versa Networks to develop a service aimed at small and medium-sized businesses that are spread out over multiple locations, as well for local government and educational institutions. “Customers are looking for a simple solution on which multiple services can be deployed, such as security, routing and SD-WAN,” says Mark Hollman, head of SDN/NFV product marketing with Verizon. “That’s why we’re providing a bundled offer of SD-WAN, security, next generation firewall and, depending on the options you select, universal threat management.” SD-WAN is also a route out of jail for carriers facing steadily diminishing MPLS sales. But simply folding an SD-WAN offer into an existing line of overpriced MPLS services is not the way to grab hearts and minds. “Few customers want to be locked into a hybrid SD-WAN solution from their MPLS carrier,” points out Andy Gottlieb, CMO and co-founder of Talari Networks. “However, for forwardthinking carriers, that create a separate enterprise managed services division, SD-WAN offers multiple opportunities to go after competitors, seek new business and expand globally at low cost. SDWAN can afford the opportunity to outsource enterprise applications to the cloud, managed remote access services and more.” SD-WAN is right on the money for enterprise CIOs facing the twin difficulty of more and more devices and mobile working at one end of their operation, and hybrid connectivity into various cloud services at the other. SD-WAN helps square this circle by providing a cloud-centric connectivity service that can combine public and private cloud networking and give consistent security, argues Andrew Halliwell, product director at Virgin Media Business. “Traditional networks were good at what they did, but overlay capacitymedia.com

them with a big Microsoft 365 or AWS deployment, and have your employees working out of coffee shops, then your network posture isn’t facing in the right direction,” he believes. Enterprise interest in SD-WAN is “off the charts”, agrees Houman Modarres, marketing leader, large enterprise and webscale, for Nokia. “In the early days, many pioneering enterprises took a DIY approach to SD-WAN and worked directly with vendors to build out branch connectivity solutions. Today, an increasing number are looking to procure managed SD-WAN as a service. Nokia is among the leaders in providing SD-WAN solutions for service providers to use as the basis of their SD-WAN offerings to enterprises.” But enterprises have an ample choice of places to turn for an SD-WAN solution, so why choose a carrier rooted in traditional connectivity? Richard Kitney, hybrid connectivity specialist with Orange Business Services, says a large and experienced carrier name is actually the perfect provider. “Contrary to the hype, SD-WAN can be quite complex to install and manage,” he points out. “So we tend to find that our Capacity customers value the help and support of an organisation like ours. We have coverage around the world, the feet on the street, and the ability to implement services.” A large carrier, he says, has the breadth to embrace customers wherever they are on the software-defined journey: “At one extreme we have Siemens who are fully virtualised where everything is delivered and controlled in software,” he adds. “They’ve gone the whole hog.” As the SD-WAN market matures and early hype gives way to a more nuanced view of the opportunity, it’s time for carriers to take a more mature approach, argues Amol Phadke, network strategy and network portfolio of services lead at Accenture. “Carriers initially thought of SD-WAN as an augmentation of their IP VPN services,” he says. “They are realising that it’s bigger than that, and that is it relevant to all types of enterprise, small, medium and large, each with slightly different needs. A big carrier challenge is how to tailor their SD-WAN offer to a specific segment. It’s not one size fits all.” The other challenge carriers may be finding with SD-WAN is the relative immaturity of the technology. Many are working hard to review a market with many different technology providers and see which is suitable to them, mindful of the likelihood that not all of today’s SD-WAN vendors will be around tomorrow when the

inevitable market consolidation hits. It’s also inevitable that as the market develops, new business models will emerge. California-based Aryaka, for example, is trying something disruptively different in the form of SD-WAN as-a-service. “About 50% of enterprise WAN traffic is to and from the cloud, and increasing,” claims Ian McEwan, VP EMEA of Aryaka. “How do these enterprise provide the right end user experience while looking after security, performance, agility and so on? There’s a huge complexity to the enterprise WAN set up, and in general it’s really cloud-unfriendly. We’re trying to take away the dilemma by offering a single solution for application performance. We connect businesses anywhere in the world, in hours not days, a flexible approach to accelerate applications across the network while giving a good end user experience.” Johan Ottosson, VP strategy at Telia Carrier, sees a fundamental shift in what enterprise customers are asking for. “Rather than the low-bandwidth, dedicated MPLS networks of the past, which mainly connected enterprises to an in-house or hosted data centre, many global enterprises are restructuring their networks around large colocation hubs, where they take advantage of competitively-priced, high-performance transport services and on-ramps to the cloud,” he says. It’s a shift, he says, that has led Telia to a lot of interesting conversations with customers seeking a new and better way of buying their networking services. It’s time for carriers to adapt to fit better into this shifting market, argues Edward Wood, president and CEO at Dispersive Networks. “Carriers can partner with solutions providers to develop solution that serve specific verticals,” he says. “Carriers can then own a niche that goes beyond basic network services where the carrier is a trusted part of the entire ecosystem. This is the manifestation of true solution-based selling and is really where the market excitement is in 2019.” It’s an imperative that he thinks goes beyond SD-WAN. “Carriers should be looking at partnering with IoT solutions providers and SaaS platform providers,” he believes. “Carriers need to see where they can add value with an end-to-end solution that solves an industry challenge. Carriers need to get out of their comfort zones if they’re going to have long-term sustainable businesses. They need to partner in new ways and actually dedicate some time to learning about verticals and finding partners to help them create new solutions.”

70 |

Ten SD-WAN projects Ç§ Ç§ Č? Ç§ Č&#x17D; ÇĄ ALAN Ç§ Ngena

Colt

Deutsche Telekom announced the Next Generation Network Alliance (Ngena) three years ago, with CenturyLink, Reliance Jio and SK Telecom â&#x20AC;&#x201C; plus Cisco as a technology partner. Since then Ngena has grown to 20 carrier members, including BT, China Unicom Global, PCCW Global and Telia, and Comarch and Equinix have also become technology partners. At the launch in 2016 Deutsche Telekom CEO Tim HĂśttges compared the project with airlinesâ&#x20AC;&#x2122; Star Alliance and Zorowar Biri Singh (pictured opposite), then CTO at Cisco, described it as a â&#x20AC;&#x153;highly interoperable networkâ&#x20AC;?. Telia became the 20th carrier member in January. Pernilla Wikman, head of global business at Telia Company, said: â&#x20AC;&#x153;Enterprises need modern data connectivity services without limits and boundaries. We are expanding our global SD-WAN portfolio by joining Ngena â&#x20AC;&#x201C; and by that we will be able to address our customersâ&#x20AC;&#x2122; needs in an even higher grade.

Colt has expanded its SD-WAN services in the Asia Pacific and into North America, and has launched its On Demand offering in Singapore. Both use the companyâ&#x20AC;&#x2122;s IQ Network, which connects to more than 850 data centres and over 27,000 on net buildings globally. Colt said its customers can now benefit from features such as application-based traffic steering, real-time service changes via an interactive customer portal, virtual routing and firewall services enabled via network function virtualisation (NFV). â&#x20AC;&#x153;These two launches demonstrate that Colt is continuing to invest in advanced SDN and NFV capabilities on a global scale,â&#x20AC;? said Peter Coppens, vice president of Coltâ&#x20AC;&#x2122;s product portfolio. â&#x20AC;&#x153;Through Coltâ&#x20AC;&#x2122;s SD WAN and On Demand services, organisations can now take full control over their agile, high bandwidth network in the way that best suits their business needs.â&#x20AC;?

Capacity NTT Com

CenturyLink

NTT Communications has partnered with collaboration services provider Arkadin to launch a unified communications (UC) solution aimed at supporting mid-market enterprises. The UC Connect platform will offer enterprises a collaboration solution combining SD-WAN capabilities with UC technology. Andrew Pearce, managing director EMEA at Arkadin, which is owned by NTT Com, said: â&#x20AC;&#x153;As modern businesses expand internationally, the demand for efficient cloud-based communication systems is growing stronger.â&#x20AC;? The solution will serve as a unified communications as a service (UCaaS) platform solution provided by a single partner, delivering scale, speed and international reach by leveraging NTT Comâ&#x20AC;&#x2122;s global network. Pearce said: â&#x20AC;&#x153;We know that every successful Enterprise grade UC deployment requires an enterprise-grade network and UC-Connect brings these crucial elements together to provide one design, implementation and support structure.â&#x20AC;?

CenturyLink has expanded the reach of its SD-WAN service to cover more than 30 countries across Asia Pacific, Europe, North America and Latin America. CenturyLink SD-WAN leverages the benefits of private as well as public networking to include dedicated internet access, broadband and wireless connectivity. Its network â&#x20AC;&#x201C; supplemented beyond the companyâ&#x20AC;&#x2122;s traditional US base to include Europe due to the acquisition of Level 3 Communications in 2017 â&#x20AC;&#x201C; now connects more than 2,200 owned and third-party data centres. It also links to more than 100,000 on-net buildings. â&#x20AC;&#x153;With our expansion of SD-WAN globally, we provide customers a complete hybrid networking solution which helps them adapt and accelerate enterprise cloud enablement,â&#x20AC;? said VP Adam Saenger. â&#x20AC;&#x153;We deliver secure, scalable and cost-efficient private-public networking across a full range of connectivity types, enabling enterprises to be more agile and decrease risk.â&#x20AC;?

GTT

TIM and Sparkle

GTTâ&#x20AC;&#x2122;s managed SD-WAN service will use VeloCloudâ&#x20AC;&#x2122;s clouddelivered technology, building on GTTâ&#x20AC;&#x2122;s success in delivering hybrid WAN services. It will expand the breadth and flexibility of the expanding groupâ&#x20AC;&#x2122;s cloud networking services, supporting the rapid growth of enterprise network traffic. CEO Rick Calder said: â&#x20AC;&#x153;As enterprise traffic continues to grow rapidly, GTT is committed to delivering cloud networking services that are application-aware and responsive to everincreasing bandwidth demands. We partner with VeloCloud for our managed SD-WAN initiative, providing our clients with optimised performance and cost-effective network expansion.â&#x20AC;? GTT has assets that include a tier-1 IP network ranked in the top five in the world, extensive connectivity to leading cloud service providers across 300+ global points of presence, and a broad portfolio of diverse last mile connectivity options to any location in the world.

TIM is working with Huawei to improve reliability, flexibility and efficiency of corporate networks using SD-WAN technology. TIMâ&#x20AC;&#x2122;s Luigi Zabatta said: â&#x20AC;&#x153;Thanks to the most advanced technologies available, these networks can be managed both jointly and by customers themselves through simple tools. The partnership with Huawei allows us to expand our value proposition for companies and to enrich our offer through the adoption of a technological model that is increasingly and rapidly emerging in the ICT industry.â&#x20AC;? Sparkle, TIMâ&#x20AC;&#x2122;s international wholesale arm, has separately partnered with independent software consultancy Amartus to launch a multi-vendor SD-WAN proof of concept, focused on developing a foundation for the next generation of services that are technology and vendor agnostic. They will provide customers with a multi-vendor, orchestrated SD-WAN solution, fully compliant with MEF framework and technical specifications. february/march 2019

feature: sd-wan power listing | 71

Zorowar Biri Singh, then CTO of Cisco, at the launch of Ngena in 2016. It is a ‘highly interoperable network’, he said

Capacity Vodafone

PCCW Global

Vodafone has added Juniper Networks’ SD-WAN offering to its enterprise-focused SDN portfolio. The telco will offer Juniper’s Contrail solution as part of its selection of offerings. The solution offers control and cost optimisation by allowing enterprises to manage multiple sites using a combination of connectivity types. Juniper CEO Rami Rahim said: “Enterprise customers are looking for simplicity, functionality and optimised total cost of ownership as they come to grips with building flexible cloud capabilities into their infrastructure.” Vodafone enterprise products and solutions director Justin Shields said: “Juniper’s focus on simplifying the network will enable Vodafone’s enterprise customers to more easily leverage the advantages of multi-cloud and a growing mobile workforce, without being burdened by the growing complexities of WAN connectivity.”

PCCW Global, which bought Console Connect in 2018, offers its SD-WAN service to enterprises in 80 countries. The service provides enterprises with “a secure, application-aware network that continually optimises for performance and cost in real time, delivering a vastly improved user experience”. SVP Jordick Wong said: “The need for intelligent and advanced business networks is growing substantially. Our SD-WAN service provides enterprises with an efficient and streamlined networking capability that maximises their existing connectivity solutions and optimises business-critical and cloud-based applications, ensuring an enhanced user experience.” SD-WAN complements PCCW Global’s existing Console Connect service, a global software-defined interconnection platform that provides automated, secure and predictable connectivity between data centres and business partners, major cloud service providers and business-critical applications.

Singtel

Singtel offers its managed SD-WAN Service for enterprise customers. Company director Hoo Shu Yee said: “For a customer who is ready to adopt the SD-WAN technology on its network, Singtel can offer the design and consultancy service to re-architect the customer WAN network. The managed SD-WAN service includes full turnkey migration for the customer as they enable SD-WAN in their network, offering a peace of mind to the IT manager.” She added: “The service is fully integrated with the underlying network including Singtel’s global MPLS services and global internet services, offering an integrated service level to the customer.” Singtel’s single service portal offers the enterprise customer a single integrated view of its overlay SD-WAN and underlay MPLS and global internet networks. There are more than 20 gateways around the world to facilitate the interchange of traffic between SD-WAN and MPLS networks.

BT’s SNAP – its service and network automation platform – aims to support enterprise customers looking to adopt SD-WAN and NFV technologies.The platform will form part of BT’s global network, with flexible architecture that means the UK telco can integrate solutions from partners, including SD-WAN controllers from Cisco and Nuage Networks. VP Keith Langridge said: “We’re investing to make it easier for our customers to take advantage of the latest networking technologies and cloud. We have created a unique environment in which customers can deploy the latest software defined services alongside their underlying network technologies. This transforms their experience of the journey to SD-WAN and makes the promise of software defined services an operational reality.” SNAP will work with Cisco’s network services orchestrator, meaning BT can offer its customers a range of managed SDWAN and NFV services.

capacitymedia.com

72 | market trends: vodafone

ARE YOU DIGITAL READY?

odafone launched its Digital, Ready? report in November 2018, examining attitudes on digital transformation from 2,000 business leaders. Anne Sheehan, enterprise director at Vodafone, was greatly encouraged by the report’s findings that many UK businesses are optimistic about the future.

Anne Sheehan, enterprise director, Vodafone

The report highlights the fact that digital transformation is a priority for the majority of businesses. It found that a fifth have already successfully implemented digital transformation projects; and more than half believe they are making good progress (53%). The importance of digital transformation cannot be understated; in fact, of those business who see it as a low-priority, only 17% are very confident about their future growth; for those who see digital transformation as a high priority, this figure almost triples to 50%. More than half (57%) of organisations say that they are planning to spend more than £100k on digital transformation in the next two years. Within digital transformation, two of the biggest trends are likely to be around mobile and the internet of things (IoT).

Mobile trends Mobile internet and cloud are key areas of focus for businesses. Two-thirds of companies say they are already making use of mobile internet and cloud (both 63%), but this is predicted to rise to more than four in five by the end of the decade (both 84%). The drive towards mobility and an any-time, any-place attitude towards work,

software and services has been ongoing for much of the last decade; and any business focused on growth and competition will have one eye on enabling its employees to deliver the best results no matter where they are. Technology has enabled challenger Capacity brands to disrupt entire industries and become dominant players in their fields,

meaning incumbent companies have to take note if they want to stay ahead. AccorHotels is one such business, having introduced a new mobile operating system for its check-in staff. Like many organisations, it adopted a strategy to innovate in an area that genuinely enhanced the experience of its customers.

... and adoption rates are set to increase dramatically over the next two years...

63%

84%

... say that they already make use of mobile internet and cloud

... plan to use mobile internet and cloud in two years

IoT trends The other big trend is IoT, which is currently being used by more than a third (36%) of organisations, but is forecast to almost double to 67% by 2020. Much of this investment is being driven by a belief that it could have a fundamental impact on the shape of tomorrow’s business. Many organisations say that IoT will improve the way they

operate (64%), that they have something to gain from it (62%), and even that embracing it will be key to future success (58%). IoT isn’t just seen as a standalone technology; a large majority (82%) say that it is intrinsically linked to subjects such as analytics, artificial intelligence and more. This is heartening; IoT isn’t only

about the technology itself, after all, but how the data that underpins it is analysed and applied to drive new ideas and business models. If organisations are able to analyse and apply the data collected from IoT, then such investment will have a fundamental impact on the shape of the businesses of the future.

february/march 2019

| 73

64%

62%

58%

... agree the internet of things will improve how businesses operate

... agree every business can benefit from the internet of things

... agree that, to be successful, it is vital to embrace the internet of things

Percentage of businesses, when questioned about future growth, ...

17%

50%

... who see digital as a low-priority are confidentCapacity ... who see digital as a high-priority are confident about their future growth about their future growth

Conclusion Vodafoneâ&#x20AC;&#x2122;s Digital, Ready? report highlights the importance of digital transformation for UK businesses. With 79% of business leaders stating that it is a strategic priority and that

57% ... say it improves efficiency within the organisation

they are keen to exploit its full potential, implementing a digital transformation strategy is mission critical. Digital transformation will naturally

51% ... say it allows us to improve the customer experience

divide opinion, but businesses must embrace change if they are to survive in a digitally-led world. For more info, read the Digital, Ready? report online.

50% ... say it ensures we always remain up to date

49% ... say it keeps us competitive

43%

41%

28%

17%

... say it supports growth by creating or allowing access to new sources of revenue

... say it keeps us ahead of competition

... say it increases satisfaction amongst employees

... say, because the government strongly encourages it

capacitymedia.com

NORTH AFRICA 2019 16 & 17 April, Cairo, Egypt

NEW

EVEN

Capacity

T H E ON LY W H O L E S AL E E V E N T C O N N E CT I N G N O RT H A F R IC AN C A R R I E R S W I T H T H E I R I N T E R N AT I O N A L PA RT N E R S

For sponsorship opportunities, please contact: Mike Niskin Commercial Manager, Conferences & Publishing mike.niskin@capacitymedia.com | +44 (0)20 7779 8408 For speaking opportunities, please contact: Frances Booth Senior Product Developer frances.booth@capacitymedia.com | +44 (0)20 7779 7324

www.capacitymedia.com/events/capacity-north-africa

WHY CAPACITY NORTH AFRICA? North Africa’s geographical positioning plays a fundamental role in the connectivity of global network infrastructure. Of late, North &KWNHFѣX XNLSN‫ܪ‬HFSHJ FX F UN[TYFQ HTRRZSNHFYNTSX YWFSXNY WTZYJ MFX GJHTRJ J[JW RTWJ UWJ[FQJSY \NYM YMJ WJLNTS \JQHTRNSL SJ\ NSYJWSFYNTSFQ NS[JXYRJSY FSI WJFUNSL YMJ GJSJ‫ܪ‬YX KWTR ,T[JWSRJSYFQ INLNYFQ YWFSXKTWRFYNTS NSNYNFYN[JX Capacity North Africa will be the essential meeting point to unite companies looking to grow their network reach in the region, as well as those that have an interest in both existing and new subsea cable routes, data centres, ISPs, IXPs and cloud & content providers.

NORTH AFRICA IN THE NEWS ALGER-ORAN-VALENCIA AND ANNABA-USA SUBSEA CABLES GO LIVE Algeria is now connected with two new submarine cables, linking the country to the USA and Spain. The Alger-Oran-Valencia and Annaba-USA cables have been driven by increased connectivity due to the growing number of subscribers and internet users in the country.

5G LICENSES EXPECTED BY 2021 IN TUNISIA The Minister of ICT and digital economy made the announcement in relation to the expected development of 5G in the country back in December 2018. The Minister, Anouar Maarouf, also made note that ‘there is a favourable ground for innovation and investment in Tunisia, notably after the enactment of the law on startup’. Source: ECOFIN AGENCY

Source: Capacity Media WHEN: Hear from LIQUID TELECOM and ORANGE INTERNATIONAL CARRIERS at Capacity North Africa 2019 as they discuss the maturing North African wholesale telecoms market.

WHEN: Hear from AFR-IX, GULF BRIDGE

INTERNATIONAL (GBI) and OTEGLOBE at Capacity North Africa 2019 as they discuss the new high capacity cable projects going live in the region.

El Djazair

TUNISIA Capacity

Tunis

Casablanca Tripoli

MOROCCO

Alexandria

ALGERIA LIBYA

MOROCCO RANKS IN TOP 5 DATA CENTRE MARKETS IN AFRICA Research suggests following a report published by BroadGroup back in July 2018 that Morocco is now in the top four African data centre markets. Source: BroadGroup WHEN: Hear from AFRICAN DATA

CENTER ASSOCIATION, GPX GLOBAL SYSTEMS, INTERXION and N+ONE DATA CENTERS at Capacity North Africa 2019 where they will discuss the growth of carrier neutral data centre facilities in the region.

LIQUID TELECOM INVESTS $400M IN EGYPT Back in December, Liquid Telecom announced they’re investing $400 million in a partnership with Telecom Egypt to build data HJSYWJX FSI ‫ܪ‬GWJ NSKWFXYWZHYZWJ NS *L^UY 9MJNW NS[JXYRJSY NS Egypt “is part of a major partnership with Telecom Egypt which includes network infrastructure and data centres”, said Liquid Telecom in a statement.

Cairo

EGYPT

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2019 about how Egypt is leveraging its geographical advantages to position itself as a transcontinental telecoms hub.

WHEN: Join the Spotlight on Subsea at Capacity North Africa 2019 to hear about the new cable projects set to serve rising data demands.

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78 | appointments

Ulf Ewaldsson T-Mobile US T-Mobile US has appointed Ulf Ewaldsson as the company’s new senior vice president of technology transformation. Reporting directly to chief technology officer and executive vice president, Neville Ray, Ewaldsson will be responsible for driving T-Mobile’s 5G technology evolution strategy. He enters the role with more than 30 years’ experience at networking and telecoms company Ericsson, where he most recently served as a senior advisor to the company’s CEO. Before that, he held numerous senior leadership positions including senior vice president and head of business area digital services, senior vice president and chief strategy & technology officer, head of group function strategy & technology, head of Ericsson’s radio product area.

Luigi Gubitosi Telecom Italia After a tumultuous boardroom tussle Luigi Gubitosi was officially named as CEO of Telecom Italia (TIM), replacing Amos Genish. Prior to joining TIM Gubitosi held a number of roles at Italian broadcaster RAI. In addition, he has also worked for Walt Disney Company. Johnson & Johnson and Italian mobile company Wind Telecomunicazioni, and he has been a banker at Merrill Lynch. Gubitosi joined Wind as CFO in 2005 and was CEO from 2007 to 2011. After leaving Wind, Gubitosi spent a few months as a banker, as country manager and head of corporate and investment banking at the Italian branch of Bank of America Merrill Lynch. He then spent three years as general manager of RAI. Gubitosi was previously appointed by the Italian government to manage bankrupt airline Alitalia before joining Telecom Italia.

Mohamed Abdel Bassit Liquid Telecom MEWA

Spencer Neumann Netflix Spencer Neumann is named as Netflix’s new chief financial officer, succeeded David Wells who held the position since 2010. Neumann is a media and financial executive who most recently served as CFO of Activision Blizzard, a US video game company. He also held numerous senior level roles at the Walt Disney Company. He served as CFO and EVP of Global Guest Experience of Walt Disney Parks and Resorts. Between 2005 and 2012, he worked for private equity firms Providence Equity Partners and Summit Partners. “Netflix is a singular brand, and I’m excited and honoured for the opportunity to work with the Netflix team and all of our stakeholders to build on the company’s exceptional track record of success and innovation,” said Neumann.

Former Orange Group executive Mohamed Abdel Bassit has been named as Liquid Telecom’s regional CEO for the Middle East and West Africa. Based in Cairo, Bassit entered the role on 1 January 1, and oversees the group’s expansion further into the area following the recent news that it is investing $400 million in the Egyptian market. In addition, he will also explore new market opportunities in west Africa as Liquid Telecom begins expanding its service offering into the region. “I am excited to be a part of Liquid Telecom’s expansion into new markets. There is enormous potential to connect many of these countries to our extensive panAfrican fibre network, bringing new competition and helping to develop the local telecoms ecosystem,” said Bassit.

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Sandra Motley Nokia As part of Nokia’s new-look group leadership team, Sandra Motey has been named as president of its fixed networks business group. Motley, who reports into president and CEO Rajeev Suri, succeeds Federico Guillén who is now president of EMEA & APAC customer operations at Nokia. She started her career at Bell Labs and held R&D and sales leadership positions at Alcatel-Lucent in fixed and wireless businesses. After joining Nokia in 2016, Motley oversaw end-to-end solutions for the North American market, and was COO for the fixed networks. “Sandy is an exceptional leader with comprehensive executive management background across global business,” said Suri.

Sebastian Seifert DE-CIX DE-CIX has named former payments specialist Sebastian Seifert as its new CFO. Seifert joins from paper maker Reflex & Co, where he was CFO for almost two years. Prior to this, he served as CFO of IT service management company Seven Principles. Seifert will join the DE-CIX group management board and will work alongside CEO Harald Summa and COO Ivo Ivanov. “We are pleased to have been able to attract such an experienced financial expert as Sebastian Seifert to become board member finance,” said Felix Höger, chair of the DE-CIX supervisory board. He is “an ideal fit” for its “national and international ambitions and goals”.

Robert Westervelt GTT Communications Robert Westervelt has been appointed as senior vice president for channel sales in the Americas for GTT. Westervelt has been with the company since 2017, previously serving as VP for channel sales for the East. His new role will see him lead GTT’s indirect sales operation across the Americas, looking after its partner-programme initiatives and strategies. Westervelt has more than 25 years’ experience in telecoms, having previously worked for NTT America, where he was VP and general manager of global solutions, Broadview and XO Communications. “Rob’s appointment to lead channel sales demonstrates GTT’s commitment to expand the indirect channel as a vital component of our organic growth strategy,” said Eric Warren, division president for the Americas.

Steve Corfe Blue Planet Networks Blue Planet Networks has appointed former NTT Europe executive Steve Corfe as its new CEO, replacing John Hammond, who had led since 2015. At NTT Europe, Corfe led the network solutions product development team, with a number of initiatives including the delivery of its European L2 backbone network. In his new role, Corfe will be tasked with accelerating the growth of the company’s carriergrade internet offering. “Blue Planet has established itself as a global ISP and an innovator in carrier-grade internet. It has shown that high-volume quoting with rapid precision pricing enables carriers to win business and serve more enterprise needs,” said Corfe.

Tell us your move

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

february/march 2019

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80 | innovation report: small satellites

LUNCHBOXES IN THE SKY THAT PROMISE TO PUT OIL TANKS ONLINE WEâ&#x20AC;&#x2122;RE MOVING INTO THE ERA OF TELECOMS SATELLITES THE SIZE OF A PLASTIC LUNCHBOX, CONNECTING THE IOT OR PROVIDING VOICE AND DATA SERVICES AROUND THE WORLD. Ç§ GRAY TALKS TO SOME OF THE COMPANIES THAT WILL LAUNCH AN ÍÇĄÍŹÍŹÍŹ

tâ&#x20AC;&#x2122;s a long time since satellites played more than a marginal role in the world of telecoms â&#x20AC;&#x201C; but weâ&#x20AC;&#x2122;re about to see the market, if youâ&#x20AC;&#x2122;ll excuse the excruciating pun, lift off into the stratosphere and beyond. According to a Frost & Sullivan report in January, 89 small satellites were put into space in the third quarter of 2018 â&#x20AC;&#x201C; thatâ&#x20AC;&#x2122;s an average of almost one a day (but theyâ&#x20AC;&#x2122;re usually launched in batches of three or more). The same report says that there will be 11,746 small satellites launched by 2030. That means an average over the next 11 years of more than 1,000 a year, nearly three a day. That will create a market worth $69 billion, says Frost & Sullivan. These are small satellites, note. Back in October 1945 Arthur C Clarke conjured up a vision of three giant, crewed space stations in orbit around the Earth to give near-universal telecoms and TV coverage. It took 20 years for his vision to begin to be realised with the first Intelsat satellite. But there werenâ&#x20AC;&#x2122;t any people on board Earlybird, which weighed just 149kg. Today there are 363 geostationary satellites above the equator, beaming TV channels to our homes and, in some cases, carrying phone calls. Theyâ&#x20AC;&#x2122;re massive â&#x20AC;&#x201C; 30 or 40 times the size of Earlybird. The new Iridium satellites, the last of which went into orbit in January, are a lot smaller: about 660kg each, orbiting at about 750km above the Earth, but theyâ&#x20AC;&#x2122;re not nano or micro satellites. New-generation satellites are really tiny. Swarm, a start-up based near San Francisco, plans satellites about the size of the plastic box I use to bring my lunch into the office. CEO and co-founder Sara Spangelo, an aerospace engineer, says Swarm now has seven small satellites in orbit: the latest three went up on a SpaceX rocket on 3 December 2018. That one launch, by the way, also carried

61 other satellites for other customers. Thatâ&#x20AC;&#x2122;s why launch costs for todayâ&#x20AC;&#x2122;s small satellites are a fraction of what Intelsat and the others pay for their five-tonne monsters. Small satellites in low orbite have other benefits. Latency is cut from 480ms round-trip to and from the Clarke orbit to 5ms or so; and the closeness to the Earth means you need less power, for the satellite and for the terminal. Capacity On 19 February one of the biggest of these small-sat start-ups, OneWeb, will launch the first six of 900 satellites on a Russian-made Soyuz rocket from Kourou, French Guiana. â&#x20AC;&#x153;The delivery of our first satellites brings us one step closer to our first launch and beginning to now build our system in space,â&#x20AC;? says OneWeb CEO Adrian Steckel. OneWebâ&#x20AC;&#x2122;s powerful backers include SoftBank, Hughes, Bharti, Virgin and Intelsat itself. I talked to a couple of new companies that are pioneering tiny satellites. Hiber, based in Delft in the Netherlands, has two satellites in orbit â&#x20AC;&#x201C; but plans another two by the end of 2019, increasing to 16 and then to 48 or more. Theyâ&#x20AC;&#x2122;re all in a polar orbit, circling the Earth 16 times a day. â&#x20AC;&#x153;That means each satellite covers everywhere once a day,â&#x20AC;? says CTO Maarten Engelen. â&#x20AC;&#x153;They scan the surface.â&#x20AC;? He and his colleagues founded the company in 2016, aiming at the internet of things (IoT) business to track or monitor shipping containers, rail cars, trucks and fuel tanks. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re talking about non-real-time store and forward â&#x20AC;&#x201C; small packets of data,â&#x20AC;? says Engelen. Hiber is working on a number of business cases. Take the rural homeowner with a tank of heating gas, refilled at fixed intervals. If the tank could send a request only when the level was dropping, Engelen thinks that three out of four refill trips could be avoided. Missing containers are a big issue for

shipping companies and you might not believe it possible to lose a rail car â&#x20AC;&#x201C; but itâ&#x20AC;&#x2122;s easy for them to get left on a quayside or shunted into a siding and just forgotten. Hiber meanwhile is hoping to build a business not just running the satellite service but also offering the data and business insights. â&#x20AC;&#x153;We donâ&#x20AC;&#x2122;t want to be a simple connectivity provider. Weâ&#x20AC;&#x2122;re in a good position to pull this all together.â&#x20AC;? But why is the company called Hiber? Because the terminal hibernates most of the time, to save power, and switches on only when a satellite comes within range, explains Engelen. Another small-satellite pioneer is Meir Moalem, CEO of Sky and Space Global (SAS). It already has three satellites in orbit, made in Denmark by GomSpace and launched in 2017 on an Indian rocket, but Moalem hopes the first of its production fleet of 200 tiny satellites will go into service later this year. That depends on satisfactory test flights for Richard Bransonâ&#x20AC;&#x2122;s Virgin Orbit, which will use a rocket attached to a Boeing 747. Itâ&#x20AC;&#x2122;s a still-untried method, and there will be a lot of flight data to analyse from the first trials this year before Moalem and other customers consign their satellites to Bransonâ&#x20AC;&#x2122;s company. The plan is to launch 16-20 satellites at once with all 200 in service by the end of 2020. Branson has other clients ahead of SAS in the queue for Virgin Orbit, Moalem says, so that 2020 target is challenging. Another challenge is the fund-raising. SAS has $25 million of backing so far. When I first met Moalem two years ago he said he would need $200 million in total. Moalem is going for a different business to Hiber, data and some voice services in the tropics, from 15Â° north to 15Â° south of the equator. But that band includes a lot of people. I did a rough calculation and came to 1.3 billion or so, about 20% of the worldâ&#x20AC;&#x2122;s people. february/march 2019

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