Few Actually Need a Gigabit: RCN

As it launches gigabit service in New York, RCN has provided one of the easiest, consumer-friendly ways an ISP can easily explain which speed tier should be purchased.

“Gigabit” mostly is a marketing platform, not a reflection of actual end user demand, in virtually all cases. Indeed, how much bandwidth any account requires is a function primarily of the number of users sharing an account, and secondarily of the types of applications used (especially streaming video).

Though RCN suggests accounts using streaming video choose a 50-Mbps plan, that assumption is based on four devices being used. In fact, for single-user accounts, even 10 Mbps will be enough to stream Netflix and other services.

The gigabit plan is said to be best for accounts supporting 10 devices or more. The 330 Mbps plan is best for eight devices; the 155 Mbps plan best for six devices. The 10-Mbps plan is said to be sufficient for one to two devices, perhaps typically a smartphone or two, perhaps sometimes a PC and a smartphone.

Faster speeds are a good thing. But few accounts actually “need” a gigabit service. The value of higher-speed services is mostly a function of the amount of bandwidth sharing on the account.

source: RCN

30 Billion to 50 Billion "Things" to be Connected by 2020?

There might be 30 billion to 50 billion Internet of Things (IoT) end-points by 2020, driving a total IoT market of up to $8.9 trillion, according to the GSA.

That represents huge numbers of new communications links, some of which might happen over non-paid connections such as Wi-Fi, but many of which will require mobile or other paid wireless connections. which explains the huge interest in IoT on the part of the mobile industry.

New developing markets, driving new communications standards and formats, typically begin with many different protocols contending, before markets pick commercial standards. That was true for videocassette recording formats, PC and smartphone operating systems, WiMAX and LTE mobile standards, for example.

GSA believes the same sort of winnowing process will happen for wireless IoT connections. Though it is conceivable that some new platforms will survive as niches, GSA believes mobile-based platforms ultimately will emerge as the mass market standards, for most applications.

With the caveat that one would expect GSA to say such things, mobile operators globally should be able to leverage their scale, over time. That is not to say mobile narrowband IoT standards will have the majority of sales in the early going. It is quite possible they will not.

Still, over time, scale should matter, as it typically does in the communications business.

The largest segments for IoT are consumer electronics, automotive and healthcare, GSA argues.

CenturyLink Moves Further in Direction of Business Services

A proposed CenturyLink acquisition of Level 3 Communications might come as a bit of a surprise. Many of us thought Comcast would be the more-likely buyer. But the proposed deal, if it goes through, would provide ample illustration of changing business strategies by former rural telcos.

Simply put: a few of the larger rural telcos have raced to recreate themselves as provider of services to business customers. That is true for Windstream, Frontier Communications and CenturyLink. In fact, CenturyLink, with a market value of about $15.2 billion, would be acquiring Level 3 at a market value of about $16.8 billion.

In its second quarter of 2016, CenturyLink earned about 34 percent of total revenue from consumers. If one assumes the transaction is consummated, then business revenues might reach as much as 88 percent of total revenues.

That is the sort of deal that might be called a "transforming" event. In other words, CenturyLink would almost immediately become a company that earns substantially much more revenue from business customers than consumers.

In fact, CenturyLink might then become a business services oriented company with some legacy rural telco operations, as well as some metro consumer operations.

CenturyLink would be a firm that "used to be" a rural telco, but has become a business-focused entity.

That further illustrates one enduring principle of the telecommunications business, in the United States and elsewhere. That principle is that tier-one service providers earn most of their profits from business customers, and use those profits to subsidize service to rural consumers.

The general principle is basically that a tier-one fixed network makes high profits in urban areas, is profitable, but less so in suburban areas and loses money in rural areas.

In the same way, tier-one service providers make money from enterprise customers, significant money from mid-market businesses and then make slimmer profits from small business.

Will Mobile Ultimately Become the Commercial Standard for IoT Connections?

There might be 30 billion to 50 billion Internet of Things (IoT) end-points by 2020, driving a total IoT market of up to $8.9 trillion, according to the GSA.

That represents huge numbers of new communications links, some of which might happen over non-paid connections such as Wi-Fi, but many of which will require mobile or other paid wireless connections. which explains the huge interest in IoT on the part of the mobile industry.

New developing markets, driving new communications standards and formats, typically begin with many different protocols contending, before markets pick commercial standards. That was true for videocassette recording formats, PC and smartphone operating systems, WiMAX and LTE mobile standards, for example.

GSA believes the same sort of winnowing process will happen for wireless IoT connections. Though it is conceivable that some new platforms will survive as niches, GSA believes mobile-based platforms ultimately will emerge as the mass market standards, for most applications.

With the caveat that one would expect GSA to say such things, mobile operators globally should be able to leverage their scale, over time. That is not to say mobile narrowband IoT standards will have the majority of sales in the early going. It is quite possible they will not.

Still, over time, scale should matter, as it typically does in the communications business.

The largest segments for IoT are consumer electronics, automotive and healthcare, GSA argues.

Telecom Infra Project Reaches 300 Members

The Telecom Infra Project, a wide-ranging effort to create open source telecom infrastructure, now has 300 members, according to Lance Condray, Facebook infrastructure strategist.

Those members include Axiata, EE, Deutsche Telekom, Globe Telecom, Indosat Ooredo, MTN, MyRepublic, SK Telecom, Tata Communications, Telefonica and Vodafone.

Acadia Networks, Accenture, Adva Optical Networking, Amdocs, Broadcom, Ciena, Equinix, Facebook, Gilat, Infinera, Intel, Juniper Networks and Nokia are some of the suppliers also working with TIP.

Facebook, Intel, and Nokia have pledged to contribute an initial suite of reference designs, while other members such as operators Deutsche Telekom and SK Telecom will help define and deploy the technology as it fits their needs

“A few years ago, Facebook was faced with a data center problem familiar to many scale companies: We depended on proprietary systems and hardware that were inflexible and expensive,” said Jay Parikh, Facebook Global Head of Engineering and Infrastructure. “We realized quickly that this approach would not be sustainable; we needed to find a new way.”

Note the language: traditional rack and stack approaches were “unsustainable.”

“We recognized that telecom infrastructure could benefit from the same innovations taking place in the data center,” Parikh said.

“It was clear that the raw building blocks of what we were developing for our own infrastructure could be applied to telecom networks with great benefit,” he said.

At first, “TIP will focus on disaggregating the components of network infrastructure that are traditionally bundled together and vendor-specific,” said Parikh.

As one early example, Facebook has been working in partnership with Globe, deploying a low-cost, solar-powered network-in-a-box solution, bringing mobile coverage to a village. “In the first week alone, we connected more than 60 percent of the community,” said Parikh.

Project groups also have been created to address “the most pressing industry needs including connecting the unconnected or underserved populations, and augmenting the development of powerful new technologies like 5G.”

The access system integration and site optimization group is chaired by SK Telecom.

The unbundled solutions group is co-chaired by SK Telecom and Nokia, and will seek cost-effective, low-power and low-maintenance solutions.

Media-friendly solutions, chaired by Intel, will focus on mobile experience, especially for close-to-edge solutions.

In the backhaul area, Facebook heads the effort to develop “thin and extensible software stack to autonomously coordinate routing, addressing and security related functions in packet-switched IPv6 networks.”

The open optical packet transport project is co-chaired by Facebook and Equinix, and is working on Dense Wavelength Division Multiplexing (DWDM) open packet transport architectures that avoid supplier lock-in.

The core network optimization project is chaired by Intel, and seeks to disaggregate

core network components.

The greenfield telecom networks group is co-chaired by Nokia, Facebook and Deutsche Telekom, and will work on IT-based network architecture.

Public Internet WANs for Branch Office Networking?

Can the public Internet support reliable enterprise wide area communications. Yes, it now seems. And data center networking seems to be a key driver.

International Data Corporation estimates global SD-WAN revenues will exceed $6 billion in 2020 with a compound annual growth rate (CAGR) of more than 90 percent between 2015 and 2020.

Gartner predicts 30 percent of enterprises will actually deploy SD-WAN technology in their branch offices by the end of 2019.

SD-WAN is a networking technique that uses the public Internet to connect dispersed sites within an enterprise network, including branch offices.

Unlike earlier WAN technology that typically involves fixed circuits and proprietary hardware, SD-WAN is a cloud-based service.

source: CenturyLink

source: CenturyLink

LS Networks to Build Rural Gigabit Networks in Pacific Northwest

LS Networks will deploy a high-density fiber-optic broadband network in 25 rural communities in Oregon and Washington over the next two years.

The program will offer simple broadband plans at 100 Mbps ($40 per month) or 1 Gbps speed costing $70 a month.

The $1.2 million “Connected Communities” project launched in Maupin, Oregon, in July, and the first services will begin in January 2017.

LS Networks is a competitive local exchange carrier that will leverage the backbone and access facilities it has built for business customers to be used for consumer Internet access. LS Networks has built more than 7,500 route miles of high-capacity fiber broadband in Oregon.

That approach might illustrate a continuing reality of the rural Internet access business, namely that it is difficult to supply high-quality services in isolated areas without revenues generated some other way.

Historically, service providers have used profits from business customer segments to support networks serving consumers; and profits from urban customers to support services for rural customers. LS Networks will use profits generated by its CLEC operations to build the rural consumer Internet access networks.