Guest Column: Understanding The Impact of Telecom’s Changing Dynamics

By Ken Mercer


Scalable access to cloud-based, as-a-service offerings, people savings, fast-expanding use of video beyond conferencing and the rise of machine (machine-to-machine or M2M) services are changing the dynamics of telecom by redefining how and why businesses build enterprise networks today.

With companies strongly urged (often by senior management) to explore the benefits of cloud resources, businesses must first evaluate the pay-as-you-go (and grow), as-a-service communications, computing, and storage alternatives to internally owned and operated IT infrastructure. But where to begin? Consider these changing telecommunications dynamics when creating a business and technology strategy for your clients:

The Fiber Frenzy. The race is on to connect corporate offices, branch offices, data centers and more to fiber-rich networks, which enable faster provisioning of bandwidth without the time and bandwidth limitations of older transmission facilities. The pursuit is increasingly aggressive.

Providers are scrambling to land business customers whether they are on unlit fiber networks, lit on-network buildings, or within reach of the lightwave systems in this modern-day application of location, location, location. Those with fiber nets have the pole position as they often need only to light the high-speed networks and provision service to a lit building.

Scalable Bandwidth. Once connected, the initial bandwidth requested can be rapidly raised to handle traffic increases and fluctuations. Thanks to advanced equipment in the network, a service provider can up the capacity from say 100 megabits to 900 megabits on a 1 gigabit port, without on-site equipment.

While expandable bandwidth is hardly new, providing it over copper connections is heavier lifting and carries capacity ceilings. Cable companies, telcos, and others have seized on the opportunity to provide scalable capacity using advanced fiber networking gear to enable faster provisioning.

Getting Connected. Service providers that have a network-to-network interface (NNI) or a point-of-presence (POP) inside the cloud networks of Amazon, Google and Microsoft can offer a better service to customers.

Ethernet has emerged as the primary interface for the access connection between the customer site and the cloud provider or between the site and the nearest service provider’s POP. Connecting a site to a cloud provider over a NNI is also popular.

Seeing Value in Video. We’re talking beyond the conference room. Greatly expanded bandwidth brings growth in the use of video to help forward-thinking (and acting) businesses expand their brands. While once limited to providing TV programming to hotels and resorts in the pioneering hospitality industry, video use has spread far and wide to most any location with a monitor and some form of waiting area, for starters.

Remember that video use has quickly expanded beyond hotels to include doctors’ offices, assisted living facilities and bars/restaurants. Video is often delivered via triple play over Ethernet. Those in the broadening vertical also look to provide Wi-Fi to their patrons as an added perk.

Content’s Kingdom. With the climbing corporate use of video and content-rich Web sites comes an elevated need for cloud-based video delivery, caching and web acceleration services. Reliability is king here as viewers won’t tolerate delays, quality issues and certainly not unavailable (busy) video on customer-facing Web sites.

Content delivery network (CDN) pioneers such as Akamai Technologies began addressing overwhelmed Web sites and optimizing video delivery well more than a decade ago and have since created cloud versions of their offerings, as have some smaller rivals. Not all cloud providers offer the services to cover this business-critical ground, though an increasing number are acquiring these abilities or partnering to provide them.

People Savings from the Cloud. The lion’s share of cloud computing pitches are made on cost avoidance, savings and greater ability to compete in a fast-changing business market. These pitches typically forget to include or focus on people savings.

Shifting basic and repetitive administration and routine management tasks from skilled IT staff to a cloud service provider lets companies re-focus their technology experts and knowledge bases to driving enhancements and advancements that directly benefit the business strategy of their employers. Customers can more quickly shorten time-to-market. Strategic efforts beat infrastructure administration and maintenance hands down.

What About Wireless? Cloud services continue to expand to include offerings from the wireless world to businesses, especially those looking to streamline and reduce the expense of managing resources such as fleets of vehicles, pipeline networks and other machine-to-machine (M2M) communications.

The tracking management and reporting from these far-flung resources can simplify logistics for companies of all sizes and continues to represent a huge growth area for cloud providers that recognize the changing wireless dynamic and add services that embrace evolution beyond wireline connectivity.

The Bottom Line

Cloud service options alone have fundamentally changed the dynamics of telecommunications by expanding the list of elements with, which to build a flexible, more affordable and dynamic enterprise network.

The list includes infrastructure-as-a-service (IaaS) offerings that are more than just building blocks because they can create technology, business and people benefits that make their combined value extra attractive to companies – and a tough trio to sell against today.

Ken Mercer is vice president at TBI, a technology master agency offering cloud, Internet, and communications services.