Showing posts with label Research. Show all posts
Showing posts with label Research. Show all posts

Sunday, August 20, 2017

Private Interconnection bandwidth is growing at a 45% CAGR

In reading the Q2 financial reports of leading global carrier, cloud companies, semiconductor fabricators and network equipment vendors, one might be tempted to think that we are in a period of single-digit growth overall, except for certain hot areas, like the public cloud or AI-enhanced anything. On a financial level, this might be the case but in terms of network traffic the industry is still booming.

Cisco’s 2017 Visual Networking Index (VNI), which is widely seen as a leading source for tracking network usage, recently predicted that global IP traffic will increase three-fold from 2016 – 2021, reaching an annual run rate of 3.3 zettabytes by 2021, up from 1.2 zettabytes in 2016, representing a compound annual growth rate (CAGR) or 24%. A year earlier, the same study predicted that global IP traffic would grow at a CAGR of 22% over the 2015-2020 period as more than a billion new Internet users come online and new applications take hold.

Whether a 24% or 22% CAGR, it’s clear from the Cisco study that significant growth continues – and perhaps is even accelerating – in overall Internet traffic. Equinix, the world’s leading co-location data centre operator, is now predicting that Interconnection Bandwidth will grow at a 35% CAGR – notably faster than Internet traffic as a whole. Specifically, the first release of the Equinix Global Interconnection Index, predicts that by 2020 Interconnection Bandwidth between private enterprises will grow to over 5,000 Tbps, a fourfold increase from 2016 with double-digit growth across all industries and use cases.

Defining Interconnection Bandwidth

Equinix defines Interconnection Bandwidth as the total capacity provisioned privately to directly exchange traffic with other parties at distributed IT exchange points. In practical terms, this means cross-connects in a colocation or Internet exchange facility, or private connections between companies either over a private-line provisioned by a carrier or dark fiber.

Equinix, which operates a fleet of 182 co-location data centres in 44 markets worldwide, is in a prime position to measure interconnection bandwidth given its long list of Fortune 1000 clients. Its Global Interconnection Index summarizes data from its own operations as well as from other carrier-neutral colocation data center providers.

For Service Providers specializing in enterprise networking, the study provides food for thought. While interconnection bandwidth is predicted to have a 35% CAGR, the predicted growth for MPLS is only 4%. If Equinix is correct, companies in 2020 will be using private interconnections for exchanging much of their data rather than asking the MPLS provider to provision spurs to their partners.

Key trends at Equinix In its Q2 financial report, Equinix posted quarterly revenues of $1,066 million, up 18% year-over-year and up 11% year-over-year on a normalized and constant currency basis. Operating revenues were $185 million, an 11% increase over the previous quarter.

During Q2, Equinix completed its acquisition of Verizon’s 29 data centers. The transaction, which was valued at $3.6 billion in cash, included over 1,000 customers, of which over 600 were new to Equinix, and approximately three million gross square feet of data center space. The 29 data centers are located across 15 cities in North and Latin America, three markets of which are new to Equinix (Bogota, Culpepper and Houston). This brought Equinix's total global footprint to approximately 17 million gross square feet.

Significantly, Equinix boasts that it now serves 42% of the Fortune 500 and 30% of the Global 2000. Furthermore, Equinix said its interconnection revenues in Q2 grew 24% year-over-year and 17% year-over-year on a normalized and constant currency basis, significantly outpacing colocation revenues. Cross-connects between customers increased to over 242,000. The Equinix Cloud Exchange continues to expand with connections into AWS, Microsoft Azure and Salesforce from new markets.

Some highlights of the Equinix Global Interconnection Index

Regional trends 



Use cases



By industry




Download the full Equinix Global Interconnection Index here:
http://www.equinix.com/resources/whitepapers/global-interconnection-index/

See Converge Digest 2-minute video with Equinix’s Tony Bishop
https://youtu.be/QKx8jWAfE64



Saturday, August 19, 2017

Vertical Systems: Mid-Year 2017 U.S. Carrier Ethernet LEADERBOARD

AT&T tops Vertical Systems Group's U.S. Carrier Ethernet LEADERBOARD results for Mid-Year 2017.

The following eight companies achieved LEADERBOARD status (rank order based on retail port share): AT&T, Level 3, Verizon (includes XO), Spectrum Enterprise, CenturyLink, Comcast, Windstream and Cox.

To qualify for the LEADERBOARD, providers must have four percent (4%) or more of the U.S. Ethernet services market. Shares are measured by the number of customer ports in service as tracked by Vertical Systems Group, with input from surveys of Ethernet providers.

"While the pace of growth has slowed from the market ramp years, demand for Carrier Ethernet services remains very strong in 2017," said Rick Malone, principal at Vertical Systems Group. "The revenue and profitability outlooks for many providers are improving as fiber buildouts are completed and pricing begins to stabilize."

Key results of the Mid-Year 2017 U.S. Carrier Ethernet share analysis:

  • Verizon advances to third from fourth position on the LEADERBOARD with the addition of Ethernet ports from its acquisition of XO, which was completed in February 2017. (XO was ranked seventh overall at the end of 2016.)
  • As a result, Spectrum Enterprise moves to fourth from third position on the LEADERBOARD.
  • Frontier advances to the Challenge Tier, up from the Market Player tier.
  • Level 3 is the only remaining Competitive Provider on the LEADERBOARD, which also includes four Incumbent Carriers (AT&T, Verizon, CenturyLink, Windstream) and three Cable MSOs (Spectrum Enterprise, Comcast, Cox).
  • All Ethernet providers ranked on the Mid-Year 2017 U.S. Carrier Ethernet LEADERBOARD are also represented on Vertical Systems Group's 2016 U.S. Fiber Lit Buildings LEADERBOARD.

Other providers selling Ethernet services in the U.S. are segmented into two tiers as measured by port share. The first or Challenge Tier includes providers with between 1% and 4% share of the U.S. retail Ethernet market. For Mid-Year 2017, the following companies attained a position in the Challenge Tier (in alphabetical order): Altice USA, Cogent, Sprint, Frontier and Zayo.

The second or Market Player tier includes all providers with port share below 1%. Companies in the Market Player tier include the following providers (in alphabetical order): Alaska Communications, Alpheus Communications, American Telesis, Birch Communications, BT Global Services, Cincinnati Bell, Consolidated Communications, DQE Communications, Expedient, FairPoint, FiberLight, FirstLight, Global Cloud Xchange, Great Plains Communications, GTT, Hawaiian Telecom, Lightower, Logix, LS Networks, Lumos Networks, Masergy, Midco, NTT America, Orange Business, RCN Business, Tata, TDS Telecom, Telstra, TPx Communications, Unite Private Networks, US Signal, WOW!Business and other companies selling retail Ethernet services in the U.S. market.

https://www.verticalsystems.com/vsglb/mid-year-2017-u-s-carrier-ethernet-leaderboard/

Dell'Oro: WLAN market bolstered by cloud subscriptions

Migration to higher-end and Cloud-managed products will bolster the Wireless LAN market between now and 2021, according to a newly released market forecast report by Dell’Oro Group, which predicts that average prices will rise with user adoption of new technologies and Cloud subscription licenses

“The trend is clear—users are willing to pay a premium for higher-performance WiFi experience,” said Trent Dell’Oro, Business Analyst at Dell’Oro Group. “Over the past several quarters average prices have been rising on like-for-like class of products. For example, upgrades to 802.11ac Wave 2, and NBASE-T have been contributing to rising average prices. We predict the trend will continue in 2018 and beyond as 802.11ax products become widely available. What we found most interesting is the impact Cloud-managed subscription license will have on average prices over the long run. By the fourth year of the forecast, the compounded income from licenses will be a significant contribution,” added Dell’Oro.

The Wireless LAN 5-Year Forecast Report highlights other key trends, including:

  • A discussion on the role 5G may play in Enterprise Campus networking.
  • An analysis of Enterprise Campus networking trends for wired Ethernet and Wireless LAN.
  • Cloud-managed Wireless LAN forecast by access points versus subscription licenses.
  • An in-depth analysis on the adoption of 802.11ax, at different price thresholds.


http://www.delloro.com/news/higher-end-cloud-managed-product-migration-bolster-wireless-lan-market-according-delloro-group

Wednesday, August 16, 2017

Interconnection Bandwidth Growing Faster than the Internet



Interconnection bandwidth is growing at a 45% compound annual growth rate, significantly faster than the expansion of Internet bandwidth (24% CAGR) or MPLS (4% CAGR), accounding to a newly released Global Interconnection Index from Equinix.

In this video, Tony Bishop, VP of Global Enterprise Vertical Strategy & Marketing at Equinix, introduces the Index, predicting that by 2020 interconnection bandwidth will have reached more than 5,000 Tbps of installed capacity.

Download the Equinix Global Interconnection Index at:

http://www.equinix.com/interconnection-enables-the-digital-economy/


Wednesday, August 9, 2017

Dell'Oro forecasts G.fast revenue growth of 600% in '19

According to its latest Broadband Access 5-year Forecast Report from Dell’Oro Group, G.fast revenue growth is set to increase by almost 600% in 2019 as operators complete testing and trials of G.fast amendment 3 chipsets and systems.

While the market for G.fast has been slow to develop initially, Dell'Oro predicts that 2019 will be the year when G.fast sees significant adoption, which will then have a knock-on effect on the future development of broadband access markets worldwide, including based on PON, DSL and cable/coax technology.

Dell'oro expects that momentum in the G.fast market will continue through the 5-year forecast period, and anticipates that G.fast revenue will account for more than a third of the overall DSL market by 2021.


Commenting on the report, Alam Tamboli, senior analyst at Dell’Oro, said, "Operators are holding off on massive deployments throughout their networks until they have more hands-on time with amendment 3 chipsets and systems, which will be available in early 2018… furthermore, many operators that wish to deploy G.fast into larger buildings via FTTB architectures are waiting for 32 or higher port-count units to be tested more thoroughly".

Tuesday, August 8, 2017

MeriTalk: federal agencies planning to adopt converged infrastructure

MeriTalk, a public-private partnership focused on improving the outcomes of government IT, has announced the results of its latest report, Converged: At the Core of IT All, which examines federal agencies' plans for implementing converged infrastructure solutions to address data centre demands.

The MeriTalk study, underwritten by Cisco and NetApp, finds that 59% of federal agencies are adopting to converged infrastructure solutions as part of their current data centre strategies, while 23% have multiple converged solutions in place. Based on a five-year outlook, the study finds that the average federal agency has a target of transforming 55% of data centres to converged infrastructure solutions by 2022.

MeriTalk notes that modern mission demands are changing the way the government delivers data centre solutions, which is prompting the shift to converged infrastructure. Currently, the study reveals that 72% of federal IT managers believe converged infrastructures will become the central housing mechanism for their data centre needs.

In terms of drivers for the move to invest in converged infrastructures, the study finds that while cost savings are a significant factor, current users of converged systems also cite improved data protection, increased scalability and optimising mission-critical apps as key motivators for the deployment of the new technology.

In addition, MeriTalk notes that converged infrastructures align with the Data Center Optimization Initiative (DCOI), as 60% of agencies leverage converged infrastructure to replace working data centres.

However, the study shows that although 57% of current converged users experience growth in operational efficiency, issues remain relating to security, budget and interoperability concerns. In particular, 44% of federal IT managers cite security concerns as the main disincentive to the adoption of a converged infrastructure solution.

The full report, Converged: At the Core of IT All, can be downloaded here: https://www.meritalk.com/study/converged-at-the-core-of-it-all/(registration required).

Regarding the study, Rob Stein, VP, U.S. public sector, at NetApp, said, "The road to an integrated IT system should not be a daunting one… most (existing) data centres and related systems cannot keep up with the growing amount of data within federal agencies… integrating all the pieces of the data centre together radically simplifies data management, especially in the new hybrid cloud world".


Wednesday, August 2, 2017

AT&T Tops U.S. Fiber Lit Buildings LEADERBOARD

AT&T topped the newly released U.S. Fiber Lit Buildings LEADERBOARD from  Vertical Systems Group based on results for year-end 2016.

Eleven companies attained a position on the 2016 U.S. Fiber Lit Buildings LEADERBOARD as follows (in rank order by number of fiber lit buildings): AT&T, Verizon, Spectrum Enterprise, CenturyLink, Comcast, Level 3, Cox, Lightower, Zayo, Altice USA and Frontier.

Retail and wholesale fiber providers with 10,000 or more on-net fiber lit commercial buildings in the U.S. qualify for this new benchmark.

“On-net fiber lit buildings are valued strategic assets that give retail and wholesale providers a competitive edge in profitably delivering services to business customers. A major benefit of a fiber lit building is ready connectivity with provisioning through service orchestration, without the construction cost and extensive lead time required to light a building,” said Rosemary Cochran, principal at Vertical Systems Group. “These dynamics are driving this year’s acquisitions among fiber providers that will significantly impact the U.S. fiber landscape. Eighteen of the twenty-eight Fiber LEADERBOARD and Challenge Tier companies have fiber-related transactions just completed or pending.”

The Challenge Tier of providers includes companies with lit fiber connections to between 2,000 and 9,999 U.S. commercial buildings. Seventeen companies qualified for the 2016 Fiber Lit Buildings Challenge Tier as follows (in alphabetical order): Cincinnati Bell, Cleareon, Cogent, Consolidated Communications, Electric Lightwave, Fairpoint, FiberLight, FiberNet Direct, FirstLight, IFN, Lumos, Southern Light, Sunesys, Unite Private Networks, Uniti Fiber, Windstream and XO.

https://www.verticalsystems.com/vsglb/u-s-fiber-lit-buildings-leaderboard/

Tuesday, August 1, 2017

Analysys Mason evaluates Telefónica's UNICA NFV/SDN

Telefonica, serving around 346 million accesses in 21 countries, announced that Analysys Mason, the global consultancy and research firm, has released a white paper commissioned by Telefónica that evaluates progress in implementing its Telco Cloud program, which includes UNICA, the foundational architecture designed to support future networks based on network function virtualisation and software-defined networking (NFV/SDN) technologies.

Telefonica noted that the paper covers its progress with the telco cloud initiative from its launch as an innovation project through to its current status with live deployments in Germany, Argentina, Colombia and Peru. Telefonica launched its UNICA program around four years ago.

The Analysys Mason study identifies Telefónica as amongst the first operator to see the potential of incorporating cloud technologies, general-purpose hardware and a programmable network control plane into its network architecture. Telefónica envisages eventually implementing a network that is fully virtualised and programmable that will enable it to efficiently and flexibly align capacity with demand, reduce network complexity and speed new services delivery.

The Analysys Mason study finds that Telefonica's UNICA platform features a well-founded architecture that does not compromise on the original ETSI NFV principles, specifically: independence from vendor-lock-in at all layers of the architecture; the use of commodity and, where possible, open-source, cloud technologies; and encouraging market innovation through sponsorship of open-source communities.

However, the research firm concludes that Telefónica faces two key challenges in implementing a program as large and advanced as UNICA - technology challenges associated with market immaturity and challenges around the organisational, cultural and process transformations needed to implement UNICA at scale.

To address these challenges, Analysys Mason recommends that Telefónica increase dialogue with business stakeholders to demonstrate the potential of UNICA and that it prioritise internal operational and organisational transformations to prepare its operating businesses from a technology perspective to effectively use the UNICA infrastructure.

The full Analysys Mason study, Telefónica's UNICA architecture strategy for network virtualisation, can be downloaded here:


Monday, July 24, 2017

Dell'Oro Forecasts 400 Gbit/s switch market

In the latest Ethernet Switch - Data Center 5-year Forecast Report from Dell’Oro Group, the research firm forecasts that the market for 400 Gbit/s switches will ramp strongly starting in 2019, while from 2020, 25 and 100 Gbit/s will account for more than half of the data centre switch port shipments.

Dell'Oro reports that the second half of 2016 saw the beginning of a major speed upgrade cycle in the data centre based on 25 Gigabit Ethernet SerDes technology, with shipments of 25 and 100 Gbit/s reaching hundreds of thousands of ports per quarter despite supply constraints on 100 Gigabit Ethernet optical transceivers. Adoption of 25/100 Gbit/s is predicted to accelerate in 2017 and to comprise over half of data centre switching ports within only 4 years of initial shipments.
Dell'Oro notes that the rapid growth will be driven by a low price premium over preceding 10 and 40 Gbit/s port speeds as well as switch vendors consolidating their products to provide fewer speed options.

In its separate Ethernet Switch - Layer 2+3 5-year Forecast Report, Dell'Oro forecasts that the overall Ethernet switch market will grow to exceed $28 billion in 2021, driven by factors including speed upgrades, software-defined networking and subscription-based models.


Dell'Oro expects that the Ethernet switch market will remain robust over the next 5 years, with revenue and shipment growth driven primarily by the data centre segment, while the campus switching market is forecast to continue to be soft due partly to cannibalisation from WLAN.

Friday, July 21, 2017

Dell'Oro estimates cumulative $6bn 5G RAN market to '21

Dell'Oro Group finds in its latest Mobile RAN 5-year Forecast Report that while overall RAN market conditions are expected to remain challenging in the near-term, growing adoption of LTE small cells and 5G macro technologies will drive a return to market growth towards the end of the forecast period, and predicts that cumulative 5G RAN investment will exceed $6 billion by 2021.

Further highlights from Dell'Oro's mobile RAN forecast report include:

1.         LTE and 5G small cell RAN revenue is expected to increase 4-fold over the forecast period to 2021.

2.         Millimetre-wave technology is expected to account for less than 5% of the overall 5G equipment market by 2021.

3.         Almost half of 5G RAN market revenue will feature C-RAN and cloud-RAN architectures by 2021.

Dell'Oro notes that cumulative revenue for the total RAN market between 2017 and 2021 looks set to experience the weakest five-year period since it began tracking the market in 2000.

Regarding the report, Stefan Pongratz, senior director at Dell'Oro Group, said:

"A stronger focus than initially envisioned on the sub-3 and -6 GHz 5G macro layers, coupled with a robust outlook for LTE small cells, form the basis for a more optimistic view of the overall RAN market in the outer part of the forecast".

"Although the IoT impact on the RAN market remains highly uncertain, the demand for enhanced mobile broadband is expected to remain robust, resulting in strong 5G macro uptake in the advanced mobile broadband markets, with China, Japan, Korea, and North America accounting for more than 90% of the 5G market by (2021)".


Thursday, July 20, 2017

Dell'Oro forecasts microwave transmission market of $3.8bn by '21

According to the latest Microwave Transmission & Mobile Backhaul 5-year Forecast Report from Dell'Oro Group, the microwave transmission and mobile backhaul markets will continue to contract for another two years before returning to growth in 2019.

Dell'Oro expects that from 2019 market growth will be driven by the increasing use of outdoor small cells and the ramp of large-scale 5G mobile radio deployments.

Further highlights from Dell'Oro's microwave transmission and mobile backhaul forecast report include:

1.  Due to the demands of small cell deployments and the capacity requirements of 5G mobile radios fibre and copper will account for a higher share of the market for backhaul links in the future.

2.  The overall market for small cell backhaul equipment utilising fibre, copper or wireless technologies is forecast to reach $1.6 billion by 2021.

3.  The microwave transmission market is projected to total $3.8 billion by 2021, with mobile backhaul constituting approximately 70% of this revenue.

Regarding the report, Jimmy Yu, VP at Dell'Oro Group, commented, "It will likely continue to be a difficult environment for mobile backhaul equipment sales for the next two years… however, I see light at the end of the tunnel, and if (this forecast is) correct and the mobile backhaul market resumes growth in 2019, I believe that market revenue can rise to at least $5.5 billion by 2021".

Wednesday, July 19, 2017

Dell'Oro forecasts WDM revenue of $14bn by '21

In the new Optical Transport 5-year Forecast Report from Dell'Oro Group, the WDM market revenue is forecast to grow to $14 billion by 2021, driven by the demand for 100+ Gbit/s coherent wavelengths, while the total optical transport equipment market, including WDM, multi-service multiplexers and optical switches, is projected to reach $15 billion.

Highlights from Dell'Oro's latest optical transport report include:

1. Demand for WDM metro equipment is expected to outpace that for DWDM long haul over the next five years, with the average annualised revenue growth rate over the period for WDM metro equipment projected to be approximately three-times that for DWDM long haul.
2. 100+ Gbit/s coherent wavelengths will constitute approximately 90% of the overall WDM equipment market in terms of revenue by 2021.

3. Enterprise direct purchasing for data centre interconnect (DCI) will significantly influence the WDM market, with WDM-based DCI equipment revenue forecast to be reach $2.4 billion by 2021.

Commenting on the report, Jimmy Yu, VP at Dell'Oro Group, said, "Demand for coherent wavelengths running at speeds of 100 Gbit/s and higher is expected to grow at a solid pace for the next five years… specifically, I predict a large ramp in demand for 200 Gbit/s coherent wavelengths and forecast shipments of these line cards to grow at an 85% compounded annual growth rate".

Monday, July 17, 2017

Healthy growth continues for public cloud data centre infrastructure

The global market for IT infrastructure products continues to be reshaped by rapid buildouts of hyperscale data centres for public clouds. Ahead of a busy mid-summer week for data centre server announcements, several analyst studies have been released that shed light on how the market for server, storage and Ethernet switch products continues to evolve. Overall, this market grew 14.9% year over year in the first quarter of 2017 (1Q17), reaching $8 billion, according to IDC's Worldwide Quarterly Cloud IT Infrastructure Tracker. This two-digit annual growth figure compares quite favourably to the global market for telecom equipment, which has been trapped in the doldrums of low single digits for some time to the detriment of the big vendors focused on this segment.

In the case of Ericsson, the company has attempted to pivot toward the enterprise and data centre segments through a strategic partnership with Cisco. With the new management team at Ericsson, this push appears to be taking a backseat as the company focuses on its core mobile infrastructure market.

Here are the vendor market share highlights from IDC’s study:

Top 3 Vendor Group, Worldwide Cloud IT Infrastructure Vendor Revenue, Q1 2017 
(Revenues are in Millions, Excludes double counting of storage and servers)
Vendor Group
1Q17 Revenue (US$M)
1Q17 Market Share
1Q16 Revenue (US$M)
1Q16 Market Share
1Q17/1Q16 Revenue Growth
1. Dell Inc*
$1,289
16.20%
$1,292
18.60%
-0.20%
1. HPE/New H3C Group* **
$1,118
14.00%
$1,223
17.70%
-8.60%
3. Cisco
$902
11.30%
$830
12.00%
8.70%
ODM Direct
$1,976
24.80%
$1,204
17.40%
64.10%
Others
$2,678
33.60%
$2,379
34.30%
12.60%
Total
$7,963
100%
$6,928
100%
14.90%
IDC's Worldwide Quarterly Cloud IT Infrastructure Tracker, June 2017

* IDC declares a statistical tie in the worldwide cloud IT infrastructure market when there is a difference of one percent or less in the vendor revenue shares among two or more vendors.
** Due to the existing joint venture between HPE and the New H3C Group, IDC will be reporting external market share on a global level for HPE as "HPE/New H3C Group" starting from Q2 2016 and going forward.

In its study, IDC found that cloud IT infrastructure sales as a share of overall worldwide IT spending climbed to 39% in 1Q17, a significant increase from 33.9% a year ago. IDC also found that revenue from infrastructure sales to private cloud grew by 6.0% to $3.1 billion, and to public cloud by 21.7% to $4.8 billion.

What is interesting here is that the hyperscale cloud providers, including Amazon Web Services (AWS), Microsoft Azure and Alibaba Cloud, have each reported much higher growth rates, approaching or exceeding the triple digit threshold. This would be a healthy situation for the cloud operators, indicating that they are getting greater efficiency from their infrastructure.

The IDC study also confirms that enterprise spending continues to move to clouds, both public and private. IDC found that revenue in the traditional (non-cloud) IT infrastructure segment decreased 8.0% year over year in the first quarter of the year, but that spending for private cloud infrastructure is growing, especially Ethernet switching (up 15.5% year-over-year), storage (excluding double counting with servers at 10.0%) and server (up 2.1% year-over-year. Public cloud growth was led by storage, which after heavy declines in 1Q16 grew 49.5% year over year in 1Q17, followed by Ethernet switch at 22.7% and server at 8.7%. IDC further notes that for traditional IT deployments, sales of servers declined the most (9.3% year over year), with Ethernet switch and storage declining 4.4% and 6.1%, respectively.

Gartner finds standalone worldwide server market is declining, except hyperscale
A Gartner study that focused only on the sale of servers found that Q1 2017 revenue worldwide declined 4.5% year over year, while shipments fell 4.2% from the first quarter of 2016. Jeffrey Hewitt, research VP at Gartner, noted, "Although purchases in the hyperscale data centre segment have been increasing, the enterprise and SMB segments remain constrained as end users in these segments accommodate their increased application requirements through virtualisation and consider cloud alternatives".

Below are highlights of the Gartner study that were published in June 2017:

Worldwide Server Vendor Revenue Estimates -  1Q17 (US Dollars)
Company
1Q17
1Q17 Market Share (%)
1Q16
1Q16 Market Share (%)
1Q17-1Q6 Growth (%)
Revenue
Revenue
HPE
3,009,569,241
24.1
3,296,591,967
25.2
-8.7
Dell EMC
2,373,171,860
19
2,265,272,258
17.3
4.8
IBM
831,622,879
6.6
1,270,901,371
9.7
-34.6
Cisco
825,610,000
6.6
850,230,000
6.5
-2.9
Lenovo
731,647,279
5.8
871,335,542
6.7
-16
Others
4,737,196,847
37.9
4,537,261,457
34.7
4.4
Total
12,508,818,106
100
13,091,592,596
100
-4.5
Source: Gartner (June 2017).

Nutanix, which offers a hyperscale solution integrating compute/storage/networking, recently reported that its quarterly revenue jumped 67% to reach $191.8 million for the quarter ended April 30, 2017. Its customers fit into the enterprise category. Cited examples include Caterpillar, KYOCERA Communication Systems, MobileIron, SAIC Volkswagen and Société Générale. From this one can conclude that market is shifting rapidly from stand-alone or departmental clusters of servers to an enterprise cloud architecture, whether public, private or hybrid. The distinctions between servers, switches and storage are also blurring.

Dell’Oro tracks white box server shipments

White box server shipments continued to grow at a rapid pace in 1Q17, increasing 41% year on year, according to a recently published report from Dell’Oro Group.  This research agency attributes the surge in spending to mainly Google and Amazon, with Facebook and Microsoft expected to pick up the pace of their white box server deployments too. Dell'Oro noted that nearly all the major U.S.-based branded vendors, led by Hewlett-Packard Enterprise and Dell Technologies, suffered quarter-over-quarter and year-over-year shipment declines for a number of different reasons, including: server migration from the Enterprise/on premise to the Cloud; typical Q1 softness; and a pause in server purchases in anticipation of the Intel Purley server refresh cycle, which is expected in the second half of the year.

These trends are probably best recorded in the sales data for Intel's Xeon products, which continue to dominate all segments of the market. More details on Intel’s plans for the data centre are expected later this week.



Wednesday, June 28, 2017

ABI forecasts $1.7bn market over 5 yrs for unlicensed/shared spectrum

According to ABI Research's latest Network Evolution in Unlicensed and Shared Spectrum report, which explores the use of unlicensed and shared spectrum, technologies enabling the utilisation of this spectrum type are not only attracting interest from established mobile network operators for low cost network densification, but also from new entrants to the market.

ABI finds that this interest is due to the opportunities that the network technologies offer for densification, neutral hosts, as well as enterprise and private network operators. The research firm predicts that new LTE unlicensed and shared spectrum technologies will create a $1.7 billion hardware market over the next 5 years encompassing LTE Unlicensed, CBRS (citizens broadband radio service) and MulteFire technology.

ABI notes that as a result of the power restrictions inherent with unlicensed and shared spectrum, the technologies are most suitable for small cell indoor or venue deployments. Based on low or no spectrum acquisition costs, plus deployment economics comparable to WiFi, ABI forecasts that demand for in-building wireless penetration in the mid-sized and enterprise verticals will increase dramatically and account for more than half of in-building small cell shipments in 2021.

The research firm reports that numerous companies are developing in technology in this area, ranging from the Spectrum Access System (SAS) providers and Environmental Sensing Capability (ESC) operators for CBRS, including Alphabet, CommScope, Federated Wireless, to small cell and infrastructure vendors such as BaiCells, Casa Systems, Ericsson, Huawei, ip.access, Nokia, Ruckus and SpiderCloud.

With regards to CBRS, which uses the 3.5 GHz band, ABI notes that an indication that the technology will transform the in-building wireless and mobile industries is that the CBRS Alliance, which advocates for CBRS technology, counts as members all four major U.S. mobile operators, namely AT&T, Verizon, T-Mobile and Sprint, as well as major MSOs, Comcast and Charter Communications, plus Google, Intel, Nokia and Qualcomm.

Commenting on the report, Nick Marshall, research director at ABI Research, said, "LTE-U/LAA appeals to MNOs planning to densify but with insufficient spectrum or the capex to acquire it… while MulteFire and CBRS promise low network build-out costs with economics that threaten to disrupt the DAS market... the technologies appeal to service providers as CBRS pioneers a significant change in spectrum management…. (and) traditional spectrum refarming cannot match the mobile broadband throughput demands with the migration to 5G".


Tuesday, June 27, 2017

Ericsson: over half a billion 5G users in five years

A big question that must weigh on the minds of the directors at Ericsson is how soon 5G rollouts will begin. It has been a tough few years at Ericsson in particular, and for many other non-Chinese network equipment vendors in the mobile space as well. Many of the big mobile operators in the developed markets have already completed their 4G LTE network construction. Minor upgrades and fill-in projects continue, but for the most part the big spending campaigns have slowed to a trickle.  With mobile penetration rates exceeding 100% in many markets, the networks can only grow by poaching subscribers from local rivals. The good news is that traffic-per-user is surging and the networks gradually are filling up. On the horizon are many innovative apps that promise even heavier network loads, and when standards are fully-baked and new spectrum licenses secured, a healthy upgrade cycle to 5G should begin. In the meantime, there are LTE-A enhancements underway and Gigabit LTE deployments in progress. The big question for Ericsson is: when will 5G begin and how fast will the network upgrades occur?

The latest edition of the Ericsson Mobility Report has just been released. The company has updated this report on an annual or semi-annual basis for the past five years, providing its mobile operator customers and the market at-large with valuable predictions concerning technology and usage trends.

5G is perhaps the starring topic again in this edition of the Mobility Report, with the big finding that by 2022 Ericsson predicts there will be more than half a billion 5G subscriptions, with a population coverage of 15%.

This figure is bolder than what Ericsson has published before. For instance, in June 2014, Ericsson was still expecting a slower uptake for LTE to persist, particularly in Europe. In that forecast from 3 years ago, Ericsson predicted that by the end of 2019, LTE would make up around 50% of the subscriptions base in Western Europe. Of course, in 2014 not everyone had to carry a smartphone. In fact, only 65% of all phones sold in Q1 2014 were smartphones. The 3G network in Europe was well developed, so the Ericsson Mobility Report expected these trends to linger. The current report finds that GSM/EDGE still constitutes the largest category of mobile subscriptions, but that LTE will become the dominant mobile access technology in 2018, and will likely reach 5 billion subscriptions by the end of 2022, or more than seven times the GSM/EDGE-only subscriptions. This will be the final sunset for 3G.

In this year's report, Ericsson calculates that the total traffic in mobile networks increased by 70% between the end of Q1 2016 and the end of Q1 2017 - a huge leap! Incidentally, a big part of the gain is linked to Reliance Jio Infocomm launching its LTE network in India and offering free mobile data on a trial basis. Within six months of launch, Jio reached 100 million broadband and VoLTE customers, making it the fastest growing operator in the world for 2016. But traffic is surging for many other reasons as well.

5G New Radio specs will incentivise early rollouts

Earlier planning anticipated the 5G upgrade cycle to begin in the new decade, sometime after the 2020 Tokyo Olympic Games. At this year’s Mobile World Congress in February, major mobile network operators and vendors issued a call to accelerate the 5G New Radio (NR) standardisation schedule to enable large-scale trials and deployments as early as 2019, a year earlier than the previous expected timeline. In March 2017, 3GPP complied with this request by approving the acceleration of the 5G NR standardisation schedule to include an intermediate milestone for an early variant called Non-Standalone 5G NR.

Key findings

To follow are some interesting highlights on network evolution from Ericsson Mobility Report:

Ericsson anticipates that by the end of 2022 there will be 9 billion mobile subscriptions. Mobile broadband subscriptions will reach 8.3 billion, thereby accounting for more than 90% of all mobile subscriptions. The number of unique mobile subscribers is estimated to reach 6.2 billion by the end of 2022.

There are more than 1 million new mobile broadband subscribers every day.

LTE subscriptions reached a total of 2.1 billion in Q1 2017, up by 250 million new subscriptions during the quarter.

Operators are evolving their existing LTE networks to LTE-Advanced (LTE-A) networks with Category1, 4, 6, 9, 11 and 16 implementations, combining lower and higher frequency bands (both for FDD and TDD modes).

There are currently 591 commercial LTE networks deployed in 189 countries. Out of these, 194 have been upgraded to LTE-A networks.

Ericsson anticipates that the number of VoLTE subscriptions will reach 4.6 billion by the end of 2022, making up more than 90% of all LTE subscriptions globally.

The upgrade to LTE occurred significantly faster than the upgrade from 2G to 3G. In just 5 years, LTE was adopted by 2.5 billion users; it took eight years for 3G to reach this milestone.

Ericsson now expects some large-scale trials early commercial deployment of 5G in 2019 that will use the 5G NR specs.

The adoption rate of 5G mobile broadband is expected to be similar to that of LTE, with rollouts commencing in major metro areas.

Ericsson now expects North America to take a leading role in 5G rollouts as the major U.S. operators have each stated their intention to expand into pre-standard 5G. By 2022, Ericsson predicts that 25% of North American subscribers could be on 5G.

The first commercial use of 5G is expected to be for enhanced mobile broadband and fixed wireless access (FWA).

5G radio access lowers round trip latency to under 4 ms, as seen in a 5G test bed conducted by Scania and Ericsson in Sweden.

Attributes of 5G, including network slicing and low latency, will make safe public transport using autonomous vehicles a reality.

The full 2017 Ericsson Mobility Report can be downloaded here.

https://www.ericsson.com/en/mobility-report

See also