It’s hard to believe, but the first half of 2019 is in the books.  We saw all the predictions from the telecom thought leaders and industry experts starting in Q4 2018 and continuing through the first half of the year as the early roll-out of trend forecasts circulated throughout the digital and social sphere.  These topics are all being deliberated in the idea and execution arena today, so we’ll give you our take on what we have seen in the CSP industry and with the customers’ challenges we solve for on a daily basis.

  1. Rapid Investment in SDN Continues
    With the investment in software-defined wide-area network infrastructure and services expected to continue its dramatic upward trajectory as it has in recent years, this is not a tough call to have at the top of the strategy list.  The annual compound growth should continue to hover at 70%.  Coupled with the advances in flexibility and scalability, the OPEX promises to continue to come down.  That’s the good news.  The very good news?  This isn’t simply a 2019 trend – this overarching initiative shows every indication that calling it ‘a trend’ may be the understatement of the year.  Deloitte outlined several more factors pushing telcos to embrace SDN where rising network traffic demands strain resources and increase costs (more on revenue opportunities here). It may be better to simply call it ‘the future’ and the future is now.   Read more on, “What’s next for SDN?

  2. IOT, Machine Learning, and Artificial Intelligence Become Extremely Connected
    The Internet of Things continues to be a hot topic and will be for the foreseeable future.  In turn, the number of connected devices spirals upward. Gartner says, “by 2020, it is estimated there will be around 50 billion connected devices, and so, network administrators will need to ensure their networks are capable of handling the enormous that has been predicted”.  This will mount pressure to add bandwidth – and bandwidth at scaling demand – to handle the telemetry that will be generated.  Put simply, the data that needs to be harnessed and processed is certainly not diminishing of its own accord.  But when you start to look at the spectrum of Artificial Intelligence, at the scope of smart cities, the intricacies of machine learning, all the technologies that fall under this wide umbrella, we believe that there is still quite a wide expanse to cross and many opportunities for those in the business of assisting CSPs to make the digital transformation journey.  We’ll see these terms become all-encompassing with the connection between edge and core; you can be certain that the two will work together tirelessly to achieve the possibilities being sold to us with AI, IoT and Machine Learning.

    In support of growing IoT trends, keep an eye out for more as it related to the Software-Defined Data Center (SDDC) – this market, according to VariantMarketResrouce.com and MordorIntelligence.com, is expected to reach $121.9 billion by 2023 and $298 billion by 2025.  SDDC will support interconnect, cross-connect, and cloud connect solutions (Mutli-cloud) for next-generation service providers to support growing demand from their enterprise and SMB customers.

  3. 5G Becomes Dominant
    AT&T has announced the three pillars that comprise their 5G approach: Mobile 5G, fixed wireless, and edge computing.  The company vows to help business capitalize on 5G tech.  It rolled out a 5G network in a dozen areas in December of 2018, with standards-based 5G tech and mmWave.  This comes closely on the heels of Verizon’s barely concealed insult of AT&T for placing a 5GE emblem on smartphones that use AT&T’s 4G LTE network.  This serves to illustrate the current 5G situation– progress and advancement tempered by logistical barriers and economic realities.  Verizon launched 5G services in October but on proprietary specs, not standard-based like AT&T’s model.  Bottom line is that 5G is on the rise – and by some assessments to be absolutely skyrocketing.  Our feeling is that 2019 shows significant expansion where 5G is concerned, but the revolution will not be completed this year.

  4. Multi-Cloud / Telco Cloud – Connected Cloud Expansion
    As you are all well aware, the progress of cloud adoption continues, and it is showing its malleable development.  This maturity is being driven by companies coming to the growing awareness that it’s not JUST public cloud, or JUST private cloud, or JUST data centers as a solution, but a combination of them – a hybrid, multi-cloud offering.  So look for connected clouds to serve evolving needs from storage to security, from networking to app deployment.  The Tier-1 CSPs are already committed to this direction and this will naturally create downward pressure and opportunity for the second- and third-tier providers.  Listen for the term Multi-Cloud coming into use more and more frequently.  What it will mean in a pragmatic sense is that whatever type of data and workload is traveling through whichever cloud, IT will have to deliver it seamlessly and securely for app users that want their experience streamlined.

  5. Sharp Demand Rise in Consumption-Based IT Services
    Once more the potency of this trend is found in subjective language and degrees of ratings which are not precise measurements.  Do we think the consumption-based IT is on the way up?  For sure. It is already there.  That is the ‘trend’ of this entire blog as you review the first several topics above.  However, is it a ‘sharp demand increase’?  Moderate?  Depending on your business model and use case, the answer may be different.  CSPs are ready and raring to go and become frustrated with what they view as feet-dragging by vendors in supplying (what CSPs consider) pressing demand.  Conversely, many vendors continue to take the position that the supply would be flowing more strongly if the model to monetize was more clearly defined and readily accessible.  What we can tell you is that CIOs and IT execs have explicitly stated their desire for more efficiency and flexibility in terms of scalability.  This leans toward this expansion of consumption-based IT services.  More examples like Salesforce continuing to be a dominant power for Customer Relations Management (CRM) will surely lift ‘a la carte IT Service’ ripples into swells (they too saw this trend, and acquired Tableau for nearly $16 Billion – and at that price, they have calculated the future trends and demands of Business Intelligence).  Is 2019 the year for it?  Rising waves for sure – and we will see this gain traction into 2020 for sure.

  6. The Empowered Customer Demands a Powerfully Simple & Secure Centralized Portal
    No longer a convenient ‘bonus’ feature or something that will become the norm ‘in the future,’ businesses and individuals need centralized portals now.  Companies are in the service of helping their customers make their digital journey seamless, efficient, flexible, powerful, and secure – it all starts and ends with the customer.  A centralized portal is integral for communication service providers and the ever-increasing scope of their internal functions.  Outside of the need for effective intradepartmental organization is the B2B and consumer craving for streamlined services that cover a wide spectrum of needs from entertainment to financials to bandwidth-on-demand and more.  Providing single-pane-of-glass portal for employees, for customers, and for business collaborators should be a top-of-mind goal for all CSPs – if not one of the first places to start when looking to productize SDN and NFV services.

    A snapshot reminder: Oracle conducted a global research project revealing that an overwhelming majority of businesses – 80% — intend to utilize chatbots by next year.  While most see their initial use for internal activities, more and more see their utility in gaining market share and building customer loyalty.  This is just one more example of a function that will be much simpler to coordinate if managed through a single-pane-of-glass.  The move toward Unified Communications as a Service (UCaaS) and Contact Center as a service (CCaaS) for digital solutions from all devices wherever the user may be, seems only viable in the long run with a powerful and secure central portal. 

    The bottom line is that business and consumer inclinations are rapidly changing, and all of these changes lean toward an omni-channel centralized portal that meets the varied demands of diverse stakeholders.

  7. OpenKilda Expands Production in the Open Source SDN Controller
    OpenKilda – opensource SDN Controller – will grow in name recognition and use as 2019 progresses. Alongside Telstra in 2018, Hutchison Global Communications has recently launched their SDN services that sit on the OpenKilda SDN Controller – and that is just the beginning. 

    Past technologies have made fantastic headway and were instrumental in ushering in the advancements of SDN, but small cluster control and telemetry management simply will not meet the current demands that continue to grow exponentially.  The scalability of a controller is defined by the changes in throughput and latency when adding more switches and hosts to the network or the ability to add more CPU to servers where the controller runs.  A network with more switches, with more flows, and one hampered by latency because it spans a greater geography are all drivers for the need of increased scalability capabilities in SDN controllers.

    Since its inception, OpenKilda has utilized the instruments of big data and distributed processing to address scaling issues.  Its architecture has the capability to control a network of 10,000 switches with 16 million flows – an extraordinary leap forward by any standards.  Additionally, its operations and products will benefit in terms of telemetry, latency, and self-healing from the big data and distributed processing CloudSmartz and others have brought to bear in the development of OpenKilda.

Make 2019 the year to fully commit to your digital transformation journey and to drive execution on your roadmap through 2020. CloudSmartz is ready to guide CSPs through these use cases and challenges at every step of the way!   

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