Juniper Networks: SDN Enabled Networking

Juniper recently announced its approach to transition enterprises and service providers to SDNs.  Ray Mota and Brad Brooks, Juniper Networks, discuss how to virtualize the mobile network with software-defined networking and network elements of Juniper’s vMCG solution. Click here to watch the video.

Click here for Michael Kennedy's related business case analysis.

For more information about ACG Research's business case analysis service click here. 

For more information about ACG Research's syndicated and consulting services, contact sales@acgresearch.net.

Ray Mota

rmota@acgresearch.net

www.acgresearch.net

Emergence of Optical Networking in the Data Center

The networking industry is on the cusp of a major data center transformation where optical networking technology will play a pivotal role in shaping the next data center architecture. Fixed network topologies are adequate when data traffic is relatively predictable; however, data centers, today, are experiencing dynamic traffic flows that are unpredictable and require unprecedented amounts of any-to-any connectivity. In addition, server virtualization, workload mobility, and big data applications are changing traffic patterns from north-south to predominantly east-west, which places strains on typical spine/leaf networks. 

With workload mobility, virtualization, and cloud computing all vastly changing the data center, introducing the benefits of optical networking technologies into products that can manage network capacity, traffic flows, and scale to support thousands of server racks is bound to hit a sweet spot in the data center. Which company is incorporating multiple optical technologies into the data center and leveraging SDN? Click here to download the Market Impact.

For more information about ACG Research's Packet Optical Transport click here or contact  sales@acgresearch.net. 

Eve Griliches
egriliches@acgresearch.net 
www.acgresearch 

Is There a Business Case for Telecom SP IT Infrastructure services?

On the surface, cloud or IT infrastructure service initiatives appear to be attractive offerings for telecom service providers, but are they? Cloud or Infrastructure as a Service (IaaS) explicitly involves network services and hosting/IT infrastructure services. This combination of services holds the potential for higher margins and lower capital intensity than either network connectivity services or IT hosting services considered separately. These services provide higher value for subscribers than the traditional offerings because they delivery many management and support functions that subscribers would otherwise provide through internal resources, and they cost less to deliver because the cloud model improves asset utilization and reduces operating expenses. Click here to read more at FierceWireless.

Click here for more information about Michael Kennedy.

Click here for more information about ACG Research's business case analysis services or contact sales@acgresearch.net.

To read more of Michael Kennedy's articles on FierceTelecom, click here.

Michael Kennedy

mkennedy@acgresearch.net
www.acgresearch

MWC 2013: New Venue, New Industry Spirit from Barcelona

Mobile World Congress 2013 has given the industry a boost of revitalization, focused on creating change and driving technology innovation to improve how we connect.

Mobile World Congress 2013 wrapped up last week in Barcelona at a new venue, the magnificent Fira Grand Via, with record attendance. Although this attendance created too much traffic and congestion, it did not dissuade industry delegates from collaborating and demonstrating a new industry spirit focused on innovation and human advancement in the area of mobile technologies.

Even without notable industry leaders such as Apple, Google, Microsoft, and Facebook, which declined to participate so that they could maximize their own events for major announcements, LG, Huawei, and ZTE took main stage with audiences and industry press. Samsung clearly established position with sizable show investment in the areas of mobile devices and consumer focused messaging, though it also decided to strategically shift its flagship “Galaxy S4” launch to New York in two weeks.

MWC 2013 showcased new themes; most notably it spotlighted Software Defined Networking (SDN) by vendors. In the mobile IP infrastructure segment, Juniper focused on the release of a virtualized platform for SGSN/MME functions. ACG expects other vendors to update road maps and further make announcements in 2013 in this area.

Machine to Machine (M2M) was another major theme with presentations and discussions on standards-based industry adoption. M2M industry has been fragmented, but mobile SPs see significant opportunity in developing services and ecosystems. ACG expects M2M data traffic to consume 20 percent of global mobile data demand in five years.

Small Cells segment saw a plethora of announcements: silicon leaders such as Broadcom and Texas Instrument released new product families to support multigeneration technologies such as 3G and LTE within a single System on a Chip (SoC). 

Mobile SPs also announced initiatives, such as cloud-based services to support third-party (HTML5 compliant) platforms from Jolla, Mozilla (Firefox OS), and Ubuntu (Linux).

Although much of the discussion was focused on the OTT industry segment and how to work together, ACG believes mobile SP business models will need to further evolve to adopt the range of innovation offered by companies such as Viber.

MWC 2013 did not disappoint. Attendees walked with innovative ideas and information, which will, no doubt, will be the foundation for creating more change and driving technology innovation in 2013.

For more information about ACG Research's mobility syndicated and consulting services, contact sales@acgresearch.net.

Ray Mota

rmota@acgresearch.net

www.acgresearch.net

LTE Acceleration and Mobile IP Backhaul Fuel 4Q 2012 Market Growth

4Q 2012 Mobile IP Infrastructure market grew 13.5% Y/Y, reflecting strong growth in Mobile IP Backhaul and LTE acceleration.

LTE spending in 2012 has surpassed industry expectations and will continue to grow at unprecedented levels in 2013. In 4Q 2012, GSMA confirms 32 new LTE networks were commercially launched, now totaling 134 LTE networks with subscribed customers running worldwide. Mobile data traffic doubled on global networks in 2012, and is expected to double again in 2013. The proliferation of Android and iOS is also pushing up monthly average mobile data usage; ACG estimates smartphone usage on mobile networks in 2013 will increase to an average 862MB/month, globally.

As mobile SPs undergo service development and differentiation for LTE networks, they are migrating 3G networks to serve as economy class networks for low- to mid-market segment service offerings, such as value plans, MVNO wholesale, and M2M communications. Compared to LTE investments, 3G vendors' revenues still represent the majority of total market spend but will continue to decline globally over next three years. 

4Q 2012  Worldwide  Mobile IP Infrastructure  Market Share
Vendor	Rank	Market Share
Cisco	1	36.3%
Ericsson	2	19.3%
Alcatel-Lucent	3	14.0%
NSN	4	9.7%
Huawei	5	6.5%

SON, SDN, and Virtualization: Impact on Mobile IP Network Infrastructure

ACG expects Self-Optimizing Networks (SON), Software Defined Networking (SDN), and Virtualization to have a high degree of impact to vendors providing SP Mobile IP Network Infrastructure. Many vendors have plans to announce revised product road maps and innovations at Mobile World Congress 2013.  Currently, Nokia Siemens is the only major packet core vendor shipping products using commercial off-the-shelf components using ACTA standard.

ACG expects the market to radically change and innovate with technology shifts and influences occurring in SON, SDN, and virtualization. These shifts will threaten vendors’ positions and value propositions, as network economics evolve and mobile SPs adopt distributed core architectures.

For more information about ACG Research's EPC syndicated and consulting services, contact sales@acgresearch.net.

Ray Mota

rmota@acgresearch.net

www.acgresearch.net

Business Cases for Procera Networks Intelligent Policy Enforcement Solutions

Michael Kennedy, ACG Research and Ken Osowski, Procera Networks, discuss Intelligent Policy Enforcement and the ROI for two use cases. Listen to them as they discuss the capabilities of the Intelligent Policy Enforcement system and analyze the costs and benefits of the intelligent charging and congestion management use cases. Click here to watch the video.

For an expanded look at eight use cases, click here to download ACG’s business case analyses.

For more information about ACG Research's business case analysis service click here. 

For more information about Michael Kennedy, click here.

Michael Kennedy

mkennedy@acgresearch.net
www.acgresearch

Business Case for Juniper Networks Virtualized Mobile Control Gateway

Juniper Networks announced its new software and services virtual Mobile Control Gateway, which enables mobile service providers to build software-defined networks (SDN). “With mobile traffic growth exploding, operators need a virtualized Mobile Packet Core for scaling capacity up and down to both increase service velocity and control costs.  Our research has validated that Juniper’s virtual Mobile Control Gateway (vMCG) has a 54 percent lower total cost of ownership over five years and the time to deploy the initial implementation is 46 percent faster than a standalone appliance-based solution.  In addition, the vMCG provides incremental capacity additions in 87 percent less time, enabling operators to address the volatility of mobile control plane traffic driven by smartphones and smartphones apps.” Dr. Ray Mota, managing partner, ACG Research.

Click here to download the TCO. 

For more information about ACG Research's business case analysis service click here. 

For more information about Michael Kennedy, click here.

Michael Kennedy

mkennedy@acgresearch.net
www.acgresearch

How Apple Turned a Loyalist into a Critic in One Transaction

Apple’s current disinterest in customer service, once a hallmark of differentiation, has propelled the company from being outstanding to just ordinary.

I did not realize that I would have a personal experience with how far and quickly Apple has fallen. I am on my second battery with my four-year old MacBook Pro; the new battery is a little under two-years old. Two months ago, it started saying “service battery.” The message said it was not urgent but should be looked into soon. I checked it today and it was under 70% percent of design capacity after 282 cycles. Online, Apple issues guidelines that its batteries should have 80 percent life after 300 cycles (http://www.buzzle.com/articles/macbook-pro-battery.html). Several people had written that they got some help from the Genius Bar. Silly me, I figured customer service was important to the company, and it would give me the benefit of the doubt and replace it or at least give me some break. After all, I was quite pleased with my other Genius Bar appointments.

At the store, the tech told me my battery was “consumed” and that it was not covered by warranty because it was over a year old. I mentioned the standard was 80 percent after 300 cycles. The tech searched their support site and found nothing so I asked for the manager. Instead of the legendary service I was expecting, he lectured me in a condescending and combative tone. I was miffed and disappointed and left with a bad taste in my mouth (it was worse than dealing with the cable company).

The point: Apple has changed fundamentally. The old culture of obsessing about innovative products and customer service seem to be a distant memory. Instead, customers are now a transaction, and the profit on each transaction is more important than long-term loyalty.

I wonder how much it would have cost Apple to replace my battery or give me something toward the unused portion (like tire companies do), maybe $20? Now, I am no longer a loyalist. I will need to replace two MacBook Pros in the near future, and if you had told me two days ago I would be considering something other than another Mac I would have looked at you as if you were crazy. I like the iPad, but I will definitely look at other devices when I need to upgrade; I’ll do the same with my iPhone. As for the AppleTV I had my eye on, forget about it. I will probably buy a Roku or Boxee. I calculate the failure to give me that $20 has put thousands of dollars of sure business in jeopardy.

I have been reticent to criticize Tim Cook just because he is not Steve Jobs. Now, I feel he deserves a big dollop of criticism. Although I do not expect him to be Steve Jobs, I do expect him to be great in some other way. Besides the major missteps on his watch, he has allowed the company to delegate delighting customers to secondary priority. This was a key area that always differentiated Apple from everyone else. Now it is just an ordinary company. It has good products and O.K. service, but it does not stand out from the crowd anymore. 

For more about Apple, click Peaking Companies: Apple Has Ripened.

David Dines
ddines@acgresearch.net
www.acgresearch.net

100G Port Counts, It's Time to Take a Step Back

The current market for 100G ports is hotly contested and competitive, suggesting increasing disparity in the market. 

100G port shipments are simply not lining up with deployments or revenues. ACG Research tracks 100G ports but does not report on them for this very reason. Let's take a look at some of the factors influencing the market:

• Route distance: In some cases 100G will require regeneration, some will not. Most 100G deployments are layered on top of 10G routes so that regeneration sites are already established, but with coherent technology, longer distances are clearly achievable. If a service provider deploys a longer route, there will be fewer ports. If the provider has to regenerate, the port count will double. Thus, long-distance products can have lower port market share and are “penalized” simply by having better technology. In other cases, the routes are shorter, and more regeneration is an accepted fact. Either way, the numbers get skewed. 

• 100G ports are often split between metro and long-haul deployments; yet, the definition for metro can be widely assumed to be anywhere from 300km up to 700km. 100G total port counts may be recorded, but disparity of metro definitions by vendors and analysts adds to the confusion.

• Some shipments are recording nonrevenue field trials, spares and free products as port shipments (not a standard process) and this presents a challenge to defining what constitutes true port counts.

• As we are in the first year of 100G shipments, there have been the usual technical issues with any new and significantly higher bit rate. This often results in additional sparing or replacement parts, which are added to the total shipped port counts.

• In some cases, ports reported in previous quarters have been revised upwards.

We know that 100G pricing has been extremely volatile this past year. To determine an average selling price of a 100G port becomes even more problematic when revenues cannot be tied to shipments. 

Success metrics at this time should not be based on port count. Inherently, there are flaws in the current market that are distorting market share. Moving forward, we expect this to change as the market matures. As we see the price of 100G stabilize and the technology maturing, the situation will improve. 

The following are some guidelines if you are looking for overall value and sustainability in the market:

• Review other success factors in the segment. Are revenues trending up in a difficult market?
• Which vendors are service providers selecting? Are they announcing them?
• Request names of customers deploying 100G. Most use two vendors (some exceptions) for 100G.
• Examine the deployment roll-outs. How large are they?  One route does not a network make.

Note: we target no specific vendor or analyst with this report. These issues will eventually resolve themselves. We merely want to clear the air now until there is better visibility.

For more information about ACG Research's Packet Optical Transport click here or contact  sales@acgresearch.net or contact Eve at +1-408-200-0967.

Eve Griliches
egriliches@acgresearch.net 
www.acgresearch 

Worldwide Optical Market Posts Increases

The worldwide optical market increased 8.9% quarter-over-quarter and decreased 5.2% year–over-year. Last quarter, we projected that providers would post revenue of half a billion dollars below 2011 total spend, which is exactly what happened, because 1) new equipment and 100G revenues were down ~30% in 2012 compared to shipment revenues in 2011, and 2) major Tier 1s have excess capacity on their networks which is slowing their migration to 100G or causing them to move at a slower pace to upgrade capacity only where it is really needed. 

Once again content providers dominated the market; deployments were up 50–70% although the revenue paid to vendors was down 30%. Positive points show accelerating revenues for almost all vendors not focused on Tier 1s. Reported profit margins were up for the same group. We expect this trend to continue into 2013.

For more information about ACG Research's Packet Optical Transport click here or contact  sales@acgresearch.net.

Eve Griliches

egriliches@acgresearch.net 
www.acgresearch