Stagnation or Salvation?

Why service providers need to embrace metro evolution

Service providers need to evolve, and fast, or risk becoming part of the connectivity ‘race to the bottom’ in a rapidly changing and increasingly commoditised market. However, the metro network could provide salvation.", argues Moshe Shimon, ECI’s VP of Product Management.

This is the first in a series of blogs about the metro network and how it’s changing in response to emerging market trends and technological innovation.

Talking about any kind of ‘technology disruption’ these days feels like a cliché. It’s everywhere you look – retail, holidays, music, photography, TV and cinema – even the simple act of hailing a taxi has been ‘reinvented’ thanks to technology.

But disruption isn’t the only threat. As markets age and mature, differentiation becomes increasingly hard, with less and less daylight between competitors’ value propositions. Growth and profits begin taking a hit too, which fuels the drive for maximum efficiency. The result? Moribund growth or even decline, and a gradual, inexorable slide towards commoditisation of the industry’s products and services.

In the same way, I think ‘connectivity’ is in imminent danger of becoming a commodity – one that joins one dot to another for least cost. And if there’s one thing that almost every economics professor, market analyst, and industry commentator agrees on: there are very few winners in the race to the bottom – unless you a) have a monopoly or b) have something else to offer. In our world a) is not an option, so product and service innovation becomes the only logical source of differentiation and growth.

But the threat of commoditisation is compounded by other industry trends. Ones that could be seen as obstacles or, with the right mindset, opportunities. Take service evolution, for instance. The fact everything is IP-based has enabled cloudification of services, while big data, 4K video, and the proliferation of OTT players such as Netflix and Amazon Prime are fueling growth in traffic by 40-70% a year.

More, more, more, more...

Add to this the shift towards ‘mobility’. There’s more traffic from more connected devices, demanding more capacity and more bandwidth. That’s a lot of ‘mores’ right there. Also these days, users demand and expect a high Quality of Service (QoS) – ‘best effort' no longer cuts it. And looming large on the horizon, there’s the expected explosion of IoT and the advent of 5G mobile.

All roads lead to the core (but via the metro)

Together, these new enhanced services and innovations are driving the need for increased and more agile capacity in the metro network. And by metro network, I mean the bridge between the service provider’s core and their end-users’ access. In other words, the part of the network that consolidates and aggregates vast numbers of access links to mobile devices, homes and businesses.

The big picture

Thanks to this perfect storm of market trends, more and more traffic is moving to the metro, which, ultimately, leaves service providers with two options. One: do nothing and risk going down the metaphorical tubes of commoditisation. Or two: gear up and start adding value to what you currently offer, so you can use the metro network to diversify your service portfolio, create new revenue streams and compete on more than just price.

No small task

Of course, it’s easier said than done, especially when you look at the challenges ‘gearing up’ brings. Like increasing capacity to cope with bandwidth-hungry new services. Being able to offer assorted services for different types of customers requiring different types of connectivity, virtualization and upgradability – while maintaining flexibility. The scalability issues arising from ever-more connected devices that entail more connection points. Not to mention the inevitable challenge of securing all those end-points using. And how on earth do you do this efficiently and cost-effectively, without compromising the customer experience?

What would an ideal metro aggregation solution look like?

At Ribbon, we’ve asked ourselves this simple question repeatedly over the last few years. In fact, we even put together a detailed wish list of attributes, functionality and features we knew service providers with metro ambitions wanted to see in an aggregation solution. Here’s an overview of the five key ones:

From wish list to working reality

Of course, we haven’t just been sitting on our laurels these last few years. No, we’ve been busily developing our Elastic MPLS solutions – our practical, cost-effective metro aggregation solutions. These offer an extremely diverse set of services, and answer an extremely diverse set of customer needs – from simple point-to-point private connections to complex multipoint networks, which 5G backhaul will require.

With Elastic MPLS, you have a truly flexible, always-on, multi-service and cost-efficient MPLS platform. A platform that’s scalable and able to evolve as your business grows and your customers’ needs change. In short, Elastic MPLS offers a simple, do-able and practical, risk-free migration to a better metro network.