Contributed by Sachin Sathaye, Marketing Manager, Service Provider Video Solutions Group
Call it the service provider cloud. Call it the network as a platform. Call it a two-sided market, or a “B2B2C” business architecture – consumers on one side, businesses on the other. In every way, this sustained push of Internet Protocol into the day-to-day activities of service providers is bringing with it substantial new revenue opportunities.
Which is good, because the one-sided business model – marketing services to consumers only – shows every sign of heading into a period of increasing costs, and flattening revenues.
My personal favorite, of the nomenclature above, is “two-sided market,” also sometimes called the “B2B2C” business architecture; because it illustrates that service providers can grow well beyond serving “just” consumers. Residential delivery of voice, video and broadband services are the bread and butter, no doubt – but the second side stands to be just as significant, over time.
What’s the second side? It’s a group, really, of entities that could benefit from business and technology arrangements with service providers. It’s content owners, content aggregators, application developers. It’s retailers and advertisers. It’s utilities and governments. Just like Amazon needed a nationwide mobile arrangement to move electronic books into Kindles, so will a whole range of new applications and services need that kind of managed middle-man connection.
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Contributed by Stephen Liu, Mgr. Marketing, Service Provider Routing & Switching
If you happen to “stumble” upon some cash, would you use it for good? And if so, what would “good” look like?
The Broadband Stimulus Program has opened up a world of opportunities for everyone, provider and subscriber alike. What would the world look like if everyone was connected? What sort of transformations could you imagine? The possibilities seem staggering.
Fortunately, there is a fun and interactive way to experience the way people will shift the ways they work, live, play, and learn with broadband. It’s not a white paper. It’s a game. You don’t read about it; You submerse yourself in it. It’s called Cisco myPlanNet.
Since its introduction in October 2009, over 15,000 people have begun to play Cisco’s myPlanNet in over 130 different countries. Several articles have even been written praising the unique perspective this method of “edutainment” brings:
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Machine-to-Machine (M2M) technology and solutions are helping to create an “internet of things” that will drive productivity and improve lives – for consumers and businesses. At the heart of this internet of things is an intelligent IP network that enables harmonious collaboration of devices in ways that appear seamless to the user.
Mobile operators in particular are looking at the explosively growing M2M market as a major source of new services revenue. ABI research predicts that the mobile M2M market is set for explosive growth, from approximately 71 million connections in 2009 to 225 million connections globally by 2014. This growth in mobile connectivity to machines ranging from vending machines to automobiles is being driven by a number of factors including, according to ABI research:
- Telematics (i.e., convergence of telecommunications and information processing) and telemetry (i.e., remote measurement and reporting of information) are seen increasingly across many vertical industries as sources of greater operational efficiency and increased incremental revenue.
- M2M applications are benefiting from the R&D and the scale of the mobile handset industry
- Technical advances in air interface standards are enabling new 3G M2M market segments.
- Government mandates are increasingly requiring the use of telematics and telemetry functionality
- Mobile network operators (MNOs) are seeking to expand their data service offerings into M2M
Challenges for Mobile Operators
The M2M Market presents some unique technical and business requirements for Mobile Operators. The most obvious technical challenge is being able to provide connectivity to potentially many millions of virtually any kind of device. Additionally, while many M2M end devices transmit only limited traffic and thus do not require high throughput or a 3G connection, other devices have the potential to scale up bandwidth requirements significantly, for example, streaming of video from surveillance devices upon detection of a security event. The looming shortage of public IPv4 addresses is also a potential constraint, with some operators postponing commercial M2M service launches because they need to preserve their IP address allocations to satisfy the continued high growth in the number of mobile broadband subscribers.
Operators also need to adopt aggressive new business models to exploit the M2M opportunity. Average Revenue per User (ARPU) for connected M2M devices is much lower compared to mobile broadband subscribers. This can be problematic for operators where an industry indicator of overall financial health is the growth or decline in overall ARPUs. Of course, the number of potentially connected M2M devices is expected to dwarf the number of mobile broadband subscribers. M2M also brings with it specific customer support requirements, often including expertise that operators may not have in key M2M applications such as automatic telematics, transportation fleet management, security and public safety, remote healthcare monitoring, and remote automation for energy and utilities. Lastly, M2M brings with it transnational competitors operators, all seeking to service their enterprise customers with an integrated, global connectivity solution.
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Tags: abi research, application service provider, internet of things, M2M, mobile internet, mobile operator, mobile packet gateway, Service Provider
Contributed by Kaushal Agrawal, Sr. Director of Engineering at Cisco
Founding board member of NTA Forum
As we become more dependent on IP networks to make VoIP phone calls, find information, and run our businesses we usually forget what is required to ensure that a new service operates correctly. Building robust networks requires operators to spend a lot of time and test resources to validate service performance, especially since new service offerings are growing more complex. What is lacking today is a methodical, industry-wide approach to testing to promote the interoperability, standardization, and automation of test infrastructure. To address this matter, a new forum, the Network Test Automation Forum (NTAF) has formed to bring together test equipment vendors, service providers, and network equipment manufacturers.
Cisco is already trying to minimize Service Provider risk and deployment times with the availability of Cisco certified solutions, such as our IP NGN Carrier Ethernet design. It was an easy decision for us to jump at the opportunity to be a founding member of the NTAF. NTAF will help bring the right level of standardization to achieve common interoperability goals. In a complex test environment, interoperability becomes the key differentiator for service providers when improving time to market of their deliverables. As an innovator in network equipment manufacturing and with our experience with service providers such as Verizon and BT, and key test equipment vendors such as Ixia and Spirent, Cisco is well positioned to address the challenges the NTAF aims to solve.
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The Cisco name has long been synonymous with attaining the highest degree of proven expertise in the realm of Routing and Switching technology. From quite literally the first router to the 7200 and 12000 to the more recent ASR 1000 and ASR 9000 platforms, Cisco focused on and delivered ground-breaking innovation. And I believe we did it again this week with the introduction of the CRS-3 – what we believe will be the foundation of the Next-Generation Internet.
In Anticipation of Forecast Demand
When you set out to find a lasting solution to service provider’s core networking needs, you have to envision what the requirements will likely be in the foreseeable future. You must look beyond the short-term benefits of incremental enhancements.
Already, there’s an explosive growth of all types of IP traffic. Plus, the fundamental mix of traffic is changing – dramatically. Ninety percent of all consumer traffic, which in itself is about 74% of total traffic, is going to be some form of video. Mobile traffic will see a 6500% growth by 2013. Then there’s the traffic generated from the evolution of the new IT model of cloud computing – that market will witness a 300% growth by 2013.
The networking infrastructure solution to these daunting growth forecasts requires a platform architecture that delivers capacity, precisely where it’s needed most, in full anticipation of the inevitable groundswell of traffic.
That architecture needs to scale to meet the accelerating bandwidth requirements, possess service intelligence to make network and data center/cloud work as one, and provide the SP with the ability to meet these objectives with reasonable CapEx and OpEx – making this growth financially viable.
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