ACG Research

ACG Research
We focus on the Why before the What

Tuesday, July 29, 2014

Cisco NCS 6000: Building Converged and Application Intelligent Networks

To address its increasing traffic growth on its fixed and wireless networks, Telstra recently announced it will utilize the Cisco NCS 6000 platform in its network. Driving this need—which is not limited to Telstra—is the growing demand for cloud services, video and media services. Service providers are looking for cost-efficient solutions that address this growth as well as solutions that scale for the Internet of Everything and M2M networks.

Why the Cisco NCS 6000? Although other products enable intelligence on the network, Cisco differentiates by offering a solution that gives providers a programmable and intelligent network. The NCS 6000 has 1 TB/s per slot line cards with 10 port 100GE line, offering high density that can decrease the per unit cost for data transported, which results in a smaller/lower carbon footprint. This unit decrease further supports Telstra’s “green goal” of reducing its carbon footprint. 

When looking to build a converged network, it makes sense that Telstra would turn to Cisco, its trusted partner. The company has been using Cisco’s products in the core and is also a strategic partner for new cloud services. The NCS 6000 will provide Telstra with a platform to build an intelligent network that dynamically enables new products and services within the network.  

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Tuesday, July 22, 2014

Demand for Security Solutions Driving Consistent Market Growth

The total available market for Worldwide security solutions is projected to increase from $16.3 billion to more than $25 billion by 2018 (CAGR 9.1 percent). Market growth is being driven across multiple segments by increasing complexity and sophisticated nature of security threats. Additionally, mobility, cloud and the evolution of the Internet of everything are changing the IT security landscape, creating opportunity for those vendors that present a multifaceted approach to protection.

ACG Research anticipates a further melding of the vendor and product landscape as security continues to cross over from discrete point solutions to all encompassing product portfolios. New and innovative solutions have and will continue to instigate a shift in how firms think about their security. This is particularly true when it comes to mobile device management. Increased mobile device penetration, bring your own device and consumerization of IT are driving the demand for sophisticated infrastructure to accommodate a mobile environment where employees have secure access to corporate data. ACG Research forecasts double-digit growth of more than 17% across this segment.

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Friday, July 11, 2014

Programmable Carrier Networks: A New Architectural Approach

Programmable carrier networks, a new, eclectic, emerging architectural approach, incorporate concepts such as SDN, NFV, shared mesh protection, path computation element protocol and cloud computing concepts and blends them with established transport, switching, routing and network management techniques. The objective of this merger is to overcome the barriers created by traditional network architectures that carriers are encountering as they try to accommodate high and volatile traffic volumes and unpredictable traffic patterns as well as respond to the innovative business models of cloud-based and OTT service providers.

Monday, July 7, 2014

IoT B2B Ecosystem: How Can SPs Retain Their Maximum Share?

The OneM2M joint standards groups partition the Internet of Things (IoT) ecosystem by access domain, network domain and application domain. Within these domains the service providers (SP), specifically wireless SPs, are in the network domain and are responsible for the operational and business system services of the devices (OSS/BSS), for example, SIM provisioning, monitoring and management of the device over the “air,” routing traffic from the device to backend systems and applications or to other devices in the network, billing and recording of device activity based on bandwidth usage or further analytics associated with the application deployed. In a legacy machine to machine (M2M) scenario the value chain for the SP was clear; however, with the new IoT ecosystem this and business models have changed. How can SPs obtain the most value and retain reasonable financial margins within today’s IoT ecosystem?

Traditional M2M Business Models
Established M2M business models, which are limited in scope and structured, were quite clear and the revenue share among the domains was evenly distributed and predictable. Leading SP network operation field specialists acknowledge that the device provider, network provider and the application provider each receive one-third of the revenue.  A customer would request a defined service, such as a fleet/asset tracking service, from the service provider who most likely had a purpose-built solution. Depending on the quantity of assets that needed to be tracked, the service provider would know precisely how many unintelligent devices and SIMs to purchase from his device supplier, servers from the network provider and software packages to order from the applications provider. The SP would be responsible for provisioning its custom OSS/BSS systems and application services and provide the management. The customer would pay for the devices and software licenses upfront and either pay the SP per connection or by bandwidth usage. The device and software vendors would require a maintenance fee, which the SP would pass on to the customer. This is now an obsolete business model.

Present M2M/IoT Business Models
In the new M2M/IoT ecosystem SPs’ role and business models have changed. According to Network specialists, the device vendor gets around 20 percent; the network provider gets 15 percent and the application provider gets 65 percent. The new enhanced M2M devices have advanced processors that make them more intelligent, aware and thus more valuable. Because of enhanced hardware and firmware these devices can be embedded with antennas that can speak directly to the internet via 3/4G cellular or via WiFi routers. In most cases the radio access portion of the network domain has not been upgraded (2G or 3G wireless) so the expense is less. SPs use OSS/BSS platform partners because the OSS/BSS layer must be enhanced to accommodate the intelligent access devices. Application layer services are leveraged between application platform providers’ partnerships. These providers employ their own device, storage, cloud suppliers and application designers. To compete SPs have to engage in various business arrangements and complex strategic alliances with equity interests and exclusivity clauses. The negative effect is revenue fragmentation; however, providers can charge the customer more and thus raise the overall average revenue per unit. In this fragmented and crowded environment, how can the SPs continue to earn their full value?

Service Provider-Centric Use Cases
To earn their full value in the M2M/IoT ecosystem, SPs have to select their verticals and use cases very carefully. What are the characteristics of a monetizable use case for SPs? Service providers must adopt use cases that require a highly managed infrastructure and within these verticals should be mission critical and/or life dependent as well as wireless connectivity. These use cases will warrant more liability and require more regulatory demands but will enhance the importance of the SP’s network. The SP will maintain the value in the IoT ecosystem and customers will pay premium for the enhanced quality service. The following are examples of service provider-centric vertical use cases:
  • Healthcare: Remote heart/lung/brain monitoring for patients in transit; remote surgical services (monitoring/surveillance)
  • Transportation: Fleet/Asset tracking services where environmental controls for cargo/livestock need monitoring; telemetry (driverless vehicles); highly critical vehicle diagnostic monitoring and proactive resolution services
  • Manufacturing: Airborne robotic devices; off-shore mobile device control and monitoring services
  • Utilities: SCADA monitoring and proactive purification services for gas, water, soil, etc.
  • Government: Surveillance of mission-critical items; disaster recovery bots
  • Telecommunications: Banking processes and monitoring in remote areas