Webscales Yield Heavy Market Influence: Google, Facebook and Others Driving Network Equipment Roadmaps

Glen Hunt – Principal Analyst, Transport and Routing Infrastructure

Summary Bullets:

• Webscale influence on new product developments is being felt in data center interconnect and massively scalable switching and transport gear.

• Traditional telcos, however, are using these new Webscale-driven platforms to retool their own networks and prepare to deliver more agile services to protect their service base.

Since the first public networks were built, incumbent telcos like Vodafone, Deutsche Telekom and AT&T have ruled network equipment roadmaps and investments – dictating the features, operation and capabilities of new networking products. However, more recently Webscale operators are the influencers. Whereas vendors had been focused on providing the high capacity and broad coverage required by rapid smartphone adoption and a massive increase in video traffic, the focus has steadily turned to support massive, low-latency throughput between the data centers that serve the most popular brands on the Internet, dubbed FAMGA (Facebook, Apple, Microsoft, Google and Amazon). Traditional network operators are scrambling to adapt to this change in service delivery focus, and better prepare their networks for the emerging 5G and Internet of Things (IoT) era.
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Google Fiber: Will Gigabit Wireless, and Going Long, Keep It Relevant?

Erik Keith – Principal Analyst, Fixed Access Infrastructure

Summary Bullets:

  • Google Fiber, despite its still-small subscriber footprint, still generates plenty of hype, even after pulling back on its ambitious growth plans.
  • With a commitment to buildouts in major U.S. cities, gigabit wireless networking, and ongoing fiber technology development, Google Fiber appears to be in for the long haul, but must fill its leadership vacuum quickly.

Half a decade ago, Google Fiber announced its intentions to blow up the U.S. broadband market by building out its own gigabit fixed broadband service – a massive improvement over most cable and telco broadband services currently offered – for only $70 per month. Most of the Google Fiber footprint is served by GPON networking equipment, with the exception being the Ethernet FTTP assets in Utah, acquired from the failed Utopia project. Read more of this post

The 5G Migration That’s Already Happening: RAN Vendors Launching 5G-Era Base Stations

Ed Gubbins – Senior Analyst, Mobile Access Infrastructure

Summary Bullets:

  • New base station introductions in the run-up to 5G pose challenges depending on both their timing relative to competitors’ moves and their messaging relative to legacy products.
  • All major RAN vendors have faced challenges unveiling new base stations recently, including Huawei, which was forced to make big changes in response to shifting market demands.

Everywhere you look, people are talking about the coming migration to 5G mobile networks. A much less talked about – but perhaps no less challenging – transition is the one radio access network (RAN) equipment vendors are making from base stations that were optimized for LTE to ones designed to lead operators into the 5G era. Yet, in the waiting period before 5G’s true arrival, marketing new base stations aimed at future networks alongside the current generation of base stations is a balancing act akin to stepping from an unmoored boat to a pier. Read more of this post

A Tale of Two Stocks: Ericsson and ZTE

Peter Jarich

Peter Jarich – VP, Consumer Services and Service Provider Infrastructure

Summary Bullets:

  • Over the past year, the stock performance of ZTE and Ericsson has diverged, with ZTE’s share price up almost 60% over a year ago and Ericsson down almost 20%.
  • With Ericsson being a traditional telecom networking leader and ZTE just outside the top three players in the market, their stock performance tells a broader story about the market’s view of telecom and market concentration.

Earlier this week, Verdict posted a ‘Research Wire’ comparing the stock performance of Ericsson and ZTE over the past year. The exercise was a relatively straightforward one. Where Ericsson had traditionally been the top player in the telecom networking space for many years, ZTE has struggled to break into the top three. More recently, Ericsson has suffered from sales declines and disruptive corporate re-organizations, while ZTE has been forced to pay over $1 billion in sanctions in the U.S., as well as reportedly laying off 3,000 employees. Read more of this post

Cellular IoT: Understanding the “Value” of NB-IoT or LTE-M Key to Operator Success?

John Byrne

John Byrne – Service Director, Service Provider Infrastructure

Summary Bullets:

• NB-IoT and LTE-M deployments are proliferating. Proofs of concept abound, but neither technology appears to be generating significant momentum yet.

• Regardless of the technology, moving beyond connectivity is vital to mobile operator success in IoT.

In the past six months, cellular operators worldwide have been rapidly deploying narrowband (NB)-IoT and LTE-M. In June, the GSMA announced the success of its Mobile IoT Initiative, claiming nearly 75 operators deploying NB-IoT or Cat-M and 500 members in its Mobile IoT Innovators initiative designed to help operators add IoT value. The bulk of this focus has been on NB-IoT, which cellular operators are using to establish new use cases, including smart agriculture and a variety of smart cities applications involving lighting, parking meters, smart buildings and the like. For example, T-Mobile USA completed live NB-IoT smart city trials in July 2017 in advance of a planned national launch.

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NFV MANO – Entering Yet Another Bout of Turbulence

David Snow – Principal Analyst, IP Services Infrastructure

Summary Bullets:

  • Turbulence in the NFV MANO market is high; that can be good to shakeout problems, but it also makes for an uncomfortable flight.
  • Some operators have decided to take matters into their own hands; others are engaging a trusted vendor to “just make it work”.

As with any long haul flight, the risk of experiencing periods of turbulence is ever present.  The flight metaphor is also appropriate to long haul telecom network transformation projects, and NFV is certainly the largest to be navigated by the industry in the past 20 years. The NFV management and network orchestration (MANO) architectural block is a good indicator of the “flight status” of the whole NFV project, which now seems to be entering a new phase of turbulence. A couple of recent announcements have highlighted some major, and sometimes forgotten, basics: Read more of this post

AT&T Aims to SHAPE the Future of Entertainment with Time Warner Acquisition

Erik Keith – Principal Analyst, Fixed Access Infrastructure

Summary Bullets:

  • The AT&T SHAPE event, held in Burbank, California last week at the massive Warner Brothers studio lot, highlighted the impressive variety of media and entertainment assets that AT&T will gain with its pending $85 billion acquisition of Time Warner.
  • The AT&T SHAPE event showcased the company’s clear intent to transform AT&T from ‘the Phone Company’ into a 21st century media and entertainment juggernaut, which also just happens to have a very strong legacy in networking.

The AT&T SHAPE Technology and Entertainment Expo was held at the Warner Brothers studios July 14-15 in Burbank, California. The SHAPE event was quite different from previous AT&T events, primarily because of the strong focus on Hollywood and the entertainment industry. Actually being ‘on location’ on the Warner Brothers lot drove this point home very effectively. However, the format for the event was familiar, in that it consisted of roughly one-hour sessions which were delivered in one of the Warner Brothers screening theaters. Approximately 10,000 people attended the event. The main theater where the sessions were hosted had more than 500 seats, with an overflow theater and live streaming of the main stage displayed on TV monitors in other locations throughout the Warner Brothers studio lot. Read more of this post