Thursday, June 21, 2018

IDC: Cloud infrastructure sales soared at 45% rate in Q1

Venndor revenue from sales of infrastructure products (server, storage, and Ethernet switch) for cloud IT, including public and private cloud, grew 45.5% year over year in the first quarter of 2018 (1Q18), reaching $12.9 billion, according to IDC's Worldwide Quarterly Cloud IT Infrastructure Tracker.

"Hyperscaler datacenter expansion and refresh continued to drive overall cloud IT infrastructure growth in the first quarter," said Kuba Stolarski, research director for Infrastructure Platforms and Technologies at IDC.

"While all infrastructure segments continued their strong growth, public cloud has been growing the most. IDC expects this trend to continue through the end of 2018. Digital transformation initiatives such as edge computing and machine learning have been bringing new enterprise workloads into the cloud, driving up the demand for higher density configurations of cores, memory, and storage. As systems technology continues to evolve towards pooled resources and composable infrastructure, the emergence of these next-generation workloads will drive net new growth beyond traditional enterprise workloads."

Some highlights from the most recent report.

  • IDC raised its forecast for total spending on cloud IT infrastructure in 2018 to $57.2 billion with year-over-year growth of 21.3%.
  • Public cloud infrastructure quarterly revenue has more than doubled in the past three years to $9.0 billion in 1Q18, growing 55.8% year over year. 
  • Private cloud revenue reached $3.9 billion for an annual increase of 26.5%. 
  • The combined public and private cloud revenues now represent 46.1% of the total worldwide IT infrastructure spending, up from 41.8% a year ago. 
  • Traditional (non-cloud) IT infrastructure revenue grew 22.0% from a year ago, although it has been generally declining over the past several years; at $15.1 billion in 1Q18 it still represents 53.9% of total worldwide IT infrastructure spending.
  • All regions grew their cloud IT Infrastructure revenue by double digits in 1Q18. Asia/Pacific (excluding Japan) grew revenue the fastest, by 74.7% year over year. Next were USA (43.6%), Middle East & Africa (MEA) (42.3%), Central and Eastern Europe (CEE) (39.2%), Latin America (37.7%), Canada (29.4%), Western Europe (26.1%), and Japan (15.0%).

Altice forms tower infrastructure companies in France and Portugal

Altice Europe will sell off equity stakes in its tower infrastructure business in France an Portugal for EUR 2.5 billion in cash. The idea is to form two tower companies offering passive infrastructure and equipment in France and Portugal. Services will be available to all mobile network operators. Altice France and PT Portugal will enter into 20-year master agreements with these new infrastructure companies.

Altice said the deal will help it to reduce debt. Here is an outline of the plan.

Altice France has entered into an exclusivity agreement with KKR for the sale of 49.99% of the equity in the to be formed tower company (“SFR TowerCo”) that will comprise the 10,198 sites currently operated by SFR. The envisaged transaction values SFR TowerCo at an enterprise value of €3.6 billion, representing a very attractive multiple of 18.0x 2017 pro forma EBITDA of €200 million. In addition, a build-to-suit agreement for 1,200 new sites between SFR and SFR TowerCo is expected to generate approximately €250 million in additional proceeds to SFR within the next 4 years.

PT Portugal has reached an agreement with a Consortium including Morgan Stanley Infrastructure Partners and Horizon Equity Partners for the sale of 75% in the to be formed tower company (“Towers of Portugal” or “ToP”) that will comprise 2,961 sites currently operated by Altice Portugal. The transaction values Towers of Portugal at an enterprise value of €660 million, representing a highly attractive multiple of 18.9x 2017 pro forma EBITDA of €35 million. In addition, a build-to-suit agreement for 400 new sites between MEO and ToP is expected to generate approximately €60 million in additional proceeds to MEO within the next 4 years.  ToP’s portfolio of towers, strategically located throughout Portugal, represents the single largest tower portfolio in the country.

Altice founder Patrick Drahi said: “I am enthusiastic about creating new tower partnerships in France and Portugal. With KKR, Morgan Stanley Infrastructure Partners and Horizon Equity Partners, we have found long-term partners of the highest-quality who share our vision to invest in leading infrastructure and growth opportunities. We will create a leading European tower business, including the #1 in France. Both tower businesses will be uniquely positioned to grow as they provide increasingly important infrastructure services to operators in both markets. Simultaneously, these transactions underline our commitment to delever and proactively manage our balance sheet while highlighting the significant underlying value of Altice Europe’s business."

Nokia outsources its own IT management to HCL

Nokia awarded a 5-year contract to HCL Technologies for outsourced IT management services.

HCL will transform and modernize Nokia's IT infrastructure & applications landscape. Specifically, HCL will transition services from four incumbent vendors to establish an integrated IT services delivery & design framework and will implement a transformation roadmap. The deal is intended to help Nokia drive operational efficiencies in line with previously announced targets.

"This is an important development for Nokia and takes our digital transformation efforts to a new level, both for how it will enhance our IT and operational efficiencies internally for Nokia, and for how it will enable us to further elevate service delivery to our customers. HCL's track record of delivering transformational services at scale makes them the right partner for this all-important initiative," said Nokia Chief Operating Officer, Joerg Erlemeier.


  • HCL Technologies is a multinational IT services company, headquartered in Noida, Uttar Pradesh, India.

MTN South Africa demos 1.6Gbps in 100MHz TDD with 5ms latency

MTN South Africa, in partnership with Ericsson, demonstrated a 5G to a moving vehicle at the Gerotek testing facility in Pretoria.

The test used 100MHz of spectrum in the 28GHz band to achieve more than 1.6Gbps and less than 5ms latency on the connection.

The vehicle had a full obscured windscreen, requiring the driver to navigate the track using the live feed from a 4K video camera to his VR headset.

The solution demonstrated, consisted of 4 radio units, baseband equipment, a 5G user equipment (UE) prototype with an external antenna, a vehicle with the UE installed, a 4K video camera and a VR Headset, demonstrating the performance of a low-latency network.


“5G presents an opportunity for operators to improve their existing consumer businesses and address previously untapped value chains in the digitalization of industries. The collaboration between MTN South Africa and Ericsson has led to an exploration of a variety of use cases and applications for digital transformation of industries. These include the automotive, mining, transportation, agriculture, manufacturing and utilities sectors. We are proud to be demonstrating this use case with MTN” says Rafiah Ibrahim, Head of Ericsson Middle East and Africa.”

“At MTN Business, we are very excited to have demonstrated our IoT (Internet of Things) capabilities, enabled by 5G technology, to our top tier customers today. Using pilots like this, we are not only assessing and preparing our network to roll out 5G in the future, but we are also future-proofing our infrastructure to enrich customer experience and take industries to the next level,” says Wanda Matandela, Chief Business Enterprise Officer, MTN SA.

EKINOPS cites growth in FlexRate 100G + 200G modules

EKINOPS reported strong sales momentum its FlexRate solutions that provide 100 Gbps and 200 Gbps services in the same compact module.

The company cited double-digit growth for these next-generation service modules over four successive quarters since they were first delivered to customers in 2017. EKINOPS said the modules have been installed in over 15 new customer networks in just nine months.

“While we knew we had the right solution when we came to market with these new FlexRate modules and were optimistic for their success, even our best-case forecast models underestimated the demand we are now seeing for them,” said François Xavier Ollivier, Co-Founder & COO of Ekinops.

Ekinops debuts flexible line rate modules

Ekinops based in Lannion, France, a global supplier of next-generation optical networking equipment, introduced two new flexible rate line modules for its optical transport platform in metro, regional or long-haul deployments.

The two new modules – the PM 200FRS02 and PM 200FRS02-SF – employ dual QSFP28 client ports with software-selectable line side modulation that can be provisioned as either DP-QPSK or 16QAM to create 100G or 200G transport links. The new generation modules occupy only one-third the space of previous equipment, occupying only a single slot in an Ekinops 360 chassis, for three times the capacity per shelf. This makes it possible to fit up to 1.2 terabits per second of capacity in only two rack units. In addition, the PM 200FRS02-SF provides single fiber operation, giving service providers the option of cutting fiber costs in half.

Ekinops is also adding to the flexibility of the modules by introducing the PM 100G-AGG companion card for multiplexing up to ten 10G multiprotocol client services into a G.709 standard OTU4 that connects to one client port on the PM 200FRS02 or PM 200FRS02-SF.

Ekinops said its new modules will help service providers to reduce their capital and operational costs, improving the business case for deploying new capacity.

Intelsat demos 8K video transmission from Russia to Brazil

Intelsat is partnering with with Globo, one of the largest broadcasters in Latin America, to demonstrate live 8K video transmissions in Brazil for the 2018 World Cup.

The World Cup video is being shown at Rio's innovative science museum, the Museu de Amanhã at a resolution of 7680 x 4320 pixels.

The 8K signal will be transmitted as a 200 Mbps video stream at the International Broadcast Center in Moscow and transported to Tokyo. It will then be carried to Intelsat via the Intelsat point of presence in New York.

The signal will be transmitted on the IntelsatOne terrestrial network to Intelsat’s teleport in Atlanta, Georgia, where it will be re-encoded at 90 Mbps using a special NTT 8K HEVC real-time encoder.

Once the video is compressed, it will be modulated by a Newtec MDM-6100 modem in DVB-S2 and then uplinked to Intelsat 14, the company’s emerging HD video neighborhood in Latin America known for its HD and 4K content distribution.

“From HD to 4K and now 8K, Intelsat 14 is the premier, new neighborhood to ensure that viewers across Latin America have access to affordable, exciting, and breathtaking content that provides them with the most immersive viewing experience for premier sporting and entertainment events,” said Rob Cerbone, Intelsat’s Vice President and General Manager, Media. “While 8K technology is still evolving and further advancements in compression technology standards are needed, Intelsat’s premier video neighborhoods have proven that they are equipped to distribute 8K content to millions of viewers around the world. Since our founding, Intelsat’s satellite solutions have been at the forefront of innovation when it comes to content distribution and with this 8K demo, fans will be able to experience the match as if they are on the field with their favorite players.”

FirstNet enrolls first 1,000 Public Safety Agencies

More than 1,000 public safety agencies across 52 states and territories have joined FirstNet, nearly doubling the network’s adoption since April.

FirstNet is the nationwide public safety communications platform dedicated to America’s first responders which is built with AT&T in a public-private partnership.

“First responders across the country are saying ‘yes’ to THEIR network,” said Chris Sambar, senior vice president, AT&T-FirstNet. “We believe FirstNet is a nationwide asset to public safety – one that is helping first responders more easily, safely and effectively carry out their lifesaving mission. And we couldn’t be more honored to be charged with delivering it.”

The nearly 100,000 FirstNet connections are helping transform emergency communications. Since May, first responders have used FirstNet to respond to: active shooter situations, floods, large events like the 2018 Volvo Ocean Race, search and recovery missions in remote locations, tornadoes, and wildfires.

Red Hat announces revenues of $814M, up 20%, $1B buyback

Red Hat reported revenue of $814 million for the first quarter of its fiscal year 2019 ended May 31, 2018, up 20% in USD year-over-year, or 17% measured in constant currency. Subscription revenue for the quarter was $712 million, up 19% in USD year-over-year, or 16% measured in constant currency. Subscription revenue in the quarter was 87% of total revenue.

Subscription revenue from Infrastructure-related offerings for the quarter was $522 million, an increase of 14% in USD year-over-year, or 11% measured in constant currency.

Subscription revenue from Application Development-related and other emerging technology offerings for the quarter was $189 million, an increase of 37% in USD year-over-year, or 32% measured in constant currency.

GAAP operating income was $112 million, up 25% year-over-year, and GAAP net income for the quarter was $113 million, or $0.59 diluted earnings per share, compared with GAAP net income of $75 million, or $0.41 diluted EPS, in the year-ago quarter. Non-GAAP net income for the quarter was $133 million, or $0.72 diluted EPS, as compared to $104 million, or $0.58 diluted EPS, in the year-ago quarter.

Separately, Red Hat's Board of Directors authorized the repurchase of up to $1 billion of the Company’s common stock from time to time on the open market or in privately negotiated transactions.
structure-as-a-Se

Krzanich resigns as Intel CEO due to inappropriate relationship

Brian Krzanich resigned as Intel's CEO and as a member of its board of directors because of a past consensual relationship with an Intel employee. Intel said it was recently informed of the relationship and that an investigation by internal and external counsel confirmed a violation of Intel’s non-fraternization policy.

Intel's board named Chief Financial Officer Robert Swan as interim CEO, effective immediately.

Intel was recently informed that Mr. Krzanich had a past consensual relationship with an Intel employee. An ongoing investigation by internal and external counsel has confirmed a violation of Intel’s non-fraternization policy, which applies to all managers. Given the expectation that all employees will respect Intel’s values and adhere to the company’s code of conduct, the board has accepted Mr. Krzanich’s resignation.

Intel also noted that it expects to deliver a record second quarter, with revenues of approximately $16.9 billion and non-GAAP EPS of approximately $0.99. Full second-quarter results and an updated outlook for the full year on the second-quarter earnings call on July 26.

  • Brian Krzanich was named CEO of Intel in May 2013. He served previously as Intel's chief operating officer. Krzanich joined Intel in 1982.

Frontier loses its CFO

Frontier Communications announced that R. Perley McBride, its Executive Vice President and Chief Financial Officer, will be resigning from the company for personal reasons. A search for his successor is underway.

Frontier’s President and Chief Executive Officer Daniel J. McCarthy stated, “We announce Perley’s resignation with regret. He has been a major contributor to our company during pivotal times. In particular, Perley has done a tremendous job managing our balance sheet. He has negotiated improvements in the terms of our credit agreements, raised $1.6 billion of new second lien debt, and retired approximately $1.7 billion of unsecured notes. These steps, together with the stabilization in our business as reflected in our most recent quarterly results, have placed Frontier on a positive path forward. On behalf of everyone at Frontier, I wish Perley and his family the best in the future.”

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