We hope your year is off to a good start!
2023 Predictions Series
At AvidThink, we’ve been working with our partner Jim Carroll of Converge Digest to get the large queue of videos uploaded into our 2023 Predictions Showcase. We’ve had outstanding engagement and great feedback from viewers and the predictions participants. Email firstname.lastname@example.org if you want to participate in our 2024 series — it’s never too early to engage with us.
2023 Telco Cloud and Edge
We launched the site! And we’ve seen strong interest in our 2023 Telco Cloud and Edge report. If you’re interested in telco clouds today and want to learn our nine key observations, download your copy of the report today. And while you’re there, check out our gallery of thought leaders sharing views on hyperscalers, edge workloads, connectivity, and other related topics.
Private Wireless and Intent-Based Assurance
We’d also like to encourage you to read our three-part blog series supported by Federated Wireless, in which we explore some of the myths and half-truths in private wireless and discuss strategies for successful deployments — the links are in the Articles section of this newsletter. You can also find links on the articles page on our site.
In addition, we congratulate Accedian on the launch of their intent-based assurance solution in partnership with Cisco on Jan 31. You can download our latest research brief on intent-based assurance, sponsored by Accedian.
We will be at MWC Barcelona, and our calendars are about 80% filled — if you want to meet us there, reach out to us at email@example.com, we’d love to get together. Thematically, we’re expecting exhibitors to feature sustainability, private wireless, 5G monetization (shouldn’t that have been the first thing we did?), fixed wireless access, Open RAN, edge computing, telco clouds, and hopefully no more network slicing.
If you’re exhibiting at MWC and looking to amplify your message, consider working with Converge Digest and us. Check out our past showcases for 2022 MWC Barcelona and 2022 MWC Americas in Las Vegas. If you like what you see, book one of our promotional slots for our 2023 showcase — if the available slots don’t work for you, reach out, and we can make alternate arrangements. We will be spotlighting Open RAN and Private Wireless as part of the showcase, so if that’s an area of interest, you should talk to us.
As always, feel free to contact us at firstname.lastname@example.org if you are interested in participating or sponsoring upcoming sites: the new middle mile, SD-WAN/SASE, private mobile networks, disaggregated and cloud-native networks, and infrastructure security.
On with the news!
The University of Massachusetts Amherst proposes using humans as mobile antennas to make 6G more efficient. The proposal includes the theory that 6G could achieve higher bandwidth and transmit more information by using Visible Light Communications (VLC) instead or radio waves. Using VLC, data is transmitted by LEDS that rapidly flash on and off, and anything with a camera, like a smartphone, tablet, or laptop, could become a receiver. However, the one problem with using VLC is that there is a lot of leakage in the form of RF signals. However, researchers at the University of Massachusetts at Amherst theorized that leaked RF signals could be captured and harnessed for another purpose by attaching a copper coil to different objects, including walls, phones, and laptops. But the most effective way to capture leakage was by having a person wear a copper wire on their upper arm. Researchers said this solution is inexpensive and could capture enough power to support health monitoring sensors.
U.S. wireless operators like T-Mobile are asking the FCC to set aside the 12.7 GHz to 13.25 GHz spectrum band so wireless operators can use the band for 6G and beyond. The industry hopes to learn from past mistakes with 5G when operators didn’t get widespread access to valuable mid-band spectrum until several years after the 5G standard was complete. The 3GPP is expected to start working on a 6G specification around 2025, with a target of commercial 6G deployments beginning later this decade.
Analyst firm Dell’Oro Group counts 39 mobile operators around the world who have launched standalone 5G (SA). The firm said this number is a disappointment considering that more than 200 5G non-standalone (NSA) networks and more than 700 LTE networks could be implementing SA technology. Dell’Oro noted that 5G NSA is considered just a stopgap measure because it could use a new 5G radio access network coupled with an existing LTE core network. NSA was quicker to launch, so many operators used NSA to go to market with 5G. Dell’Oro said it was expected that many more SA networks would launch in 2022, but only 39 operators ended the year with SA networks.
Verizon’s SVP of Technology and Product Development, Srini Kalapala, told Light Reading that his team is preparing to move network slicing from the lab to the real world. “The foundational ingredients are coming into place,” he said. However, Kalapala declined to reveal specifics about the company’s plans but said he believes network slicing products will begin hitting the market in the next year or two. He also said besides readying the network for slicing, vendors like Qualcomm and MediaTek also must start selling chips that can support network slicing.
In an interview with Telecoms.com, Cisco VP of Service Provider EMEA Adam McHale said there’s a “general feeling” in the industry that 5G hasn’t delivered on the business case and the hype. He added that while operators in different regions of the world may have different viewpoints, most believe that the magic use case that would make 5G take off hasn’t happened yet. He suggests that operators should focus on opening up APIs and allowing third-party developers to develop on their platforms.
Synergy Research is bullish on cloud spending. The research firm said that it believes the cloud sector will double its revenues to more than $1 trillion in the next four years. That includes cloud operators and hardware, software, and services vendors that comprise the entire public cloud ecosystem. Synergy said that the cloud ecosystem reported total revenues of $544 billion in 2022, a 21% increase from the previous year.
Microsoft confirmed that it acquired Fungible, a startup that makes a type of data center hardware known as a data processing unit (DPU). Although Microsoft hasn’t confirmed the purchase price, there were reports that the company paid $190 million for the firm. Microsoft said that it plans to use Fungible’s technology to deliver multiple DPU solutions and other network and hardware system innovations. The company also said that Microsoft is committed to investing in data center infrastructure that will improve latency and increase data center server density.
Arrcus CTO Keyur Patel told Silverlinings that the company’s open-source approach and flexible silicon architecture are game-changers in the cloud business. Founded in 2016, Arrcus has raised about $77 million in funding to tackle the routing, switching, and multi-cloud networking markets. According to Patel, Arrcus differs from many competitors because it offers a disaggregated approach instead of proprietary solutions such as Arista, Juniper Networks, and Cisco. “Arrcus has built a flexible software architecture that uses merchant silicon and provides an abstraction layer so companies can focus on services rather than chips,” he said.
During its fiscal 2Q 2023 earnings, Microsoft reported revenue of $52.7 billion, a 2% year-on-year increase in revenue. In addition, the company said its net revenue was $16.4 billion, which is a decline of 12% year on year. The company’s cloud revenue increased 22% year on year to $27.1 billion. However, that decreased from 32% in FQ2 2022 to 34% in FQ 2021. CEO Satya Nadella said he doesn’t expect this downturn to last forever. CFO Amy Hood said the company expects Azure growth in FQ3 2022 to “decelerate roughly four to five points in constant currency.” Nevertheless, the company’s Intelligent Cloud segment revenue rose 18% to $21.5 billion, and Azure and other cloud services revenue increased 31% though Microsoft did not provide a breakout.
Most artificial intelligence and machine learning work is conducted in the cloud. However, companies like Microsoft are starting to hint that much of the work that AI does will no longer be done in the cloud but on PCs. However, others disagree. SilverLinings talked to Julien Salinas, CTO of natural language AI company NLP Cloud and he doesn’t believe that consumer hardware like PCs will ever be able to do the same type of AI work that is done in the cloud. The reason is that AI-oriented GPUs are very expensive, and their cost will never be justified for a PC. In addition, these AI chips are too big for PCs.
According to a Morgan Stanley Research study of 100 CIOs, nearly half of all enterprise application workloads could reside in the public cloud within three years. This is an increase from the 27% of enterprise application workloads that resided in the cloud at the end of 2022. In addition, those surveyed also said they expect on-premises application workloads to drop from 57% today to 38% by the end of 2025. This shift will primarily benefit public cloud providers, the study said.
As some enterprises eye a return to on-prem deployments, hyperscalers are trying to lock in companies by encouraging them to use their management tools in an on-prem environment. Hariprasad Pichai, a principal in the Telecommunications, Information, Media, and Electronics practice at consulting firm Arthur D. Little said that the goal of hyperscalers is to create usage even if it isn’t in their data centers. Currently, companies like 37signals announce that they are leaving the public cloud because it is very complicated and costly. However, cloud advocates say that enterprises pay for more than just servers to store their data. They are also buying proprietary tools and built-in security.
Research firm Dell’Oro Group is increasing its projections for open RAN because of progress in North America, including the open RAN efforts by Dish Network and Verizon. Although the company didn’t provide details of that progress, the report’s author told Light Reading that in one case, an operator ordered 7.2x compatible radios from one of its vendors but is still waiting to fully deploy open RAN. And in another example, Dell’Oro said that another carrier is ordering large quantities of open RAN radios to scale deployments. Although there is currently a gap between ordering equipment and deploying it, Dell Oro expects it to shrink over time.
U.S. standards group ATIS is partnering with the O-RAN Alliance to advance the industry toward more open and standards-compliant networks. Although the groups say that the partnership won’t necessarily have an immediate impact on open RAN technology, the pairing of the two industry groups is notable because ATIS’ board is composed of top officials from AT&T, Verizon, T-Mobile, Ciena, and Comcast. “The MoU combines the forces of ATIS, and the O-RAN Alliance to connect the present to the future for the open RAN ecosystem, advancing the promise of a robust open RAN marketplace,” said Susan Miller, CEO of ATIS.
Mavenir acknowledged that it cut some of its staff due to the economy and geopolitical challenges. In a statement to FierceWireless, Mavenir president and CEO Pardeep Kohli said that the company is streamlining and re-evaluating programs and investments.” Kohli added that the company is seeing a significant reduction in demand for Rich Communications Services (RCS) Network Systems outside North America and is adjusting accordingly. RCS is a protocol designed to replace SMS messages. However, Apple does not support RCS, so the service is limited to Android handsets.
Northrup Grumman tested a 5G private wireless network using open RAN with AT&T and Fujitsu. AT&T said it uses the test to demonstrate the benefits of using a 5G open RAN core in a closed system by transmitting intelligence and surveillance data over 5G. According to Northrup Grumman, 5G networks can help the military deploy new capabilities, make decisions faster, and respond more quickly to adversaries. Last year Northrop Grumman and AT&T agreed to collaborate on research and development to build a digital battle network using AT&T’s commercial 5G network and some of the defense contractor’s military technology.
SASE & SD-WAN
Secure access service edge (SASE) revenue is forecast to jump more than 30% in 2023, according to Dell’Oro Group. The research firm said that integration efforts will play a key role in SASE’s growth as enterprises continue to purchase disaggregated SD-WAN and security solutions. SASE comprises both SD-WAN and security elements, but Dell’Oro said that many enterprises are in silos, so they often purchase security and SD-WAN separately. However, as standards groups like MEF work on interoperability and integration, that should push the market for SASE to grow and evolve. Dell’Oro predicts SASE revenue will jump from around $6 billion in 2022 to $8 billion in 2023. Gartner, however, forecasts SASE sales will jump to $9.2 billion in 2023.
HughesNet, which operates a network of geostationary satellites, can deliver software-defined wide-area networking to enterprise customers. The company works with VMware, Cisco Meraki, and Fortinet on SD-WAN technology. HughesNet told FierceTelecom that the company has more than 52,000 SD-WAN locations and more than 100 customers in the U.S. The company caters to various verticals: retail, banking, healthcare, energy, and government. However, HughesNet does admit that there are some latency issues with GEO satellites because they are further away from the Earth than low-Earth orbit satellites. However, HughesNet can use compression software to minimize the effects of latency and provide a better customer experience.
AT&T’s vice president of network core infrastructure services, Mike Satterlee, said in a blog post that the company had migrated more than 52% of its production traffic onto next-generation “white box” core routers running on products from companies like Broadcom and DriveNets. Satterlee said that AT&T’s disaggregated network is meeting and, in many cases, exceeding expectations. He added that AT&T has been working to shift its core routing systems from proprietary equipment supplied by a single vendor for the past several years.
One element of AT&T’s disaggregation of its network is its agreement with DriveNets. DriveNets said in a press release that by working with AT&T’s core network traffic and delivering on its commitments to the operator, it demonstrated its strengths. But DriveNets isn’t the only vendor AT&T is working with. The company also is using edge routers from Broadcom, Cisco, and UfiSpace; cell-site gateway routers from UfiSpace running Broadcom Qumran-AX chips and Ciena’s Vyatta NOS software; Ethernet Mux based on Broadcom’s Qumran-MX chips, EdgeCore hardware, and Ciena’s SAOS Network Operating System software; Customer premise equipment (CPE) using products from Intel, Broadcom, Marvell, and Silicom coupled with Vyatta NOS software from Ciena; and Open ROADM-compliant components developed by Ciena, Cisco, Fujitsu, Infinera, and Nokia.
AT&T is reviving its old “Connected Solutions” business unit to better navigate the cross-section between 5G and the Internet of Things (IoT). The company used to have a dedicated IoT business but merged it into its broader Business Wireless unit. Cameron Coursey will serve as the interim leader of AT&T’s Connected Solutions relaunch. He told Light Reading that AT&T is combining its IoT sales and technology leaders into one department instead of separating them across different AT&T units. Coursey will report to Thaddeus Arroyo, AT&T’s chief strategy and development officer, and be part of the operator’s new Emerging Businesses arm.
During Verizon’s Q4 earnings call with investors, CFO Matt Ellis admitted that Verizon’s new 2023 guidance is much lower than the expectations the company outlined at the beginning of 2022. Ellis said that in 2022, the company had much higher expectations for the year than where it ended. The company, which added just 41,000 postpaid net customers in its consumer business and another 176,000 net customers additions among business users, said that it would continue to work to develop lines of business around mobile edge compute and private wireless networks.
5G private wireless networks are stalled due to a lack of next-generation chipsets, according to research firm ABI. Leo Gergs, senior 5G markets analyst for ABI Research, told FierceWireless that the current 5G chipsets are based on 3GPP’s Release 15. Gergs said that important 5G features, such as ultra-reliable low latency communications (URLLC), were standardized in Release 16, and there are no devices with Release 16 chipsets yet. Devices with those chips will appear in late 2023 and be widely available by the first quarter of 2024. Once that happens, Gergs expects large-scale availability will drive down device costs, and 5G private wireless networks will start to take off.
Verizon Business installed a private 5G wireless network at a smart factory run by Deloitte in Wichita, Kansas. The 60,000-square-foot factory is located on the campus of Wichita State University, and it houses an innovation center that works on Industry 4.0 use cases such as manufacturing, cybersecurity, and cloud computing. The smart factory already operates a live manufacturing line that produces STEM circuit kits donated to local schools to promote STEM education. More than 20 organizations are participating in the smart factory, including Wichita State University, Amazon Web Services, SAP, Checkpoint, Siemens, and HPE.
And that wraps it up for January! The next newsletter will be delivered late due to MWC 2023, so be patient as our team works on writing a round-up of the latest from the show floor, along with February’s news. We’ll see you back here in a month (if not in person at MWC)!
The AvidThink team