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Usage-Based Billing by Service Providers?

In the past five years, consumer monthly Internet usage has grown nearly three-fold, but users spend little more than in 2006. According to Cisco’s Visual Networking Index Global Forecast 2011, consumption per U.S. user grew 278 percent. In that same time frame, according to published research, the monthly U.S. cable broadband ARPU remained virtually flat.

As consumers increasingly rely on their broadband access for more of the basic everyday needs, broadband has become the most important core service provider service when compared to pay TV, mobile voice, landline phone and mobile data. But these broadband service providers are struggling to get consumers to equate the value of their online experiences with the value of their broadband service. To that end, SPs are actively considering usage-based billing strategies as a tool to align consumer value perceptions with their underlying networks. Anecdotal evidence from non-U.S. SPs that have introduced usage-based billing indicates that it can drive new value creation.

To help explore consumers’ perspectives, Cisco’s Internet Business Solutions Group (IBSG) conducted a survey of broadband users in the United States, Canada, France, and Italy to determine current views on usage-based billing policies and approaches.

This particular document is titled “Usage-Based Billing Strategies Can Enable SPs to Align Customer Value Perception with Network Investments”.   It can be found on the Service Provider Thought Leadership section of the website of Cisco IBSG.  At this site, you will find many interesting, provocative papers on various subjects relating to the service provider segment.  

Check this and others out . . .

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Reflections on the Top Five Developments of 2011

It’s that time of year:  take a break, reflect, maybe clean up the hard drive.

I had a chance to do the reflection part last week, and came up with what I hope is a pretty good weave of what Service Providers experienced over the last 12 months.

Here is my ‘take’ on the top five trends of the whirlwind year that is still, for a week or two, 2011:

1.    In the crawl-walk-run sequence as it relates to the global shift to all-IP, 2011 went from “crawl” to “jog” — skipping “walk” entirely.

Think about it. Think about all of it, which is a lot, when it comes to the global transition to all-IP: Fixed networks; mobile Internet, Video, Cloud.

Across the world, wherever there is IP, there was monumental change in 2011. While 2010 was a year of anticipation and preparation, 2011 teemed with news and trends about the burgeoning Internet: more Video, more emphasis on mobile broadband; more work on keeping the “big iron” routing and switching fabrics around the world plumbed to keep up with demand.

We continued to do our best to keep up with the enormity of all-IP, with our ongoing VNI (Visual Networking Index) and Cloud Index forecasts. We’re still anticipating a quadrupling of Internet traffic by 2015, mostly because of video usage by mobile and “connected” IP devices. Lots more data here.

2.    Video (still) trumps as the biggest driver in Internet / IP usage. Read More »

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Cisco Introduces Global Cloud Index

Cisco today announced its inaugural Global Cloud Index (2010-2015)-- research that forecasts, among other topics, that Global Cloud Computing Traffic will Reach 1.6 Zettabytes by 2015 and Global Cloud Traffic Will Exceed One-Third of All Data Center Traffic by 2015. This analysis was undertaken by the same team that presents the Visual Networking Index (VNI).

Read More »

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Just in time for the holidays: cloud data!

With the emergence of cloud computing, our customers have looked for real-world data that could help them understand the nature and scope of the cloud phenomenon. But that kind of data has not been readily available.

Not satisfied with this lack of information, a research team at Cisco reviewed 30Tb of data each month, more than 45 million speed tests, analyst forecasts, and inputs from our customers.  The result?

Today, Cisco released its first Cisco Global Cloud Index report — a forecast of IP data center and cloud-based traffic growth and trends worldwide, 2010-2015.

Similar to the Cisco Visual Networking Index in purpose and approach, the Global Cloud Index enables organizations to make strategic networking and management decisions and governments to make informed public policy decisions.

Some highlights from the report reveal: (all data global)

1.    Cloud traffic is growing twice as fast as data center traffic, increasing from 130 exabytes in 2010 to 1.6 zettabytes annually by 2015

  • 1.6 zettabytes is approximately equivalent to 22 trillion hours of streaming music
  • 76% of this traffic will remain within the data center itself
  • By 2015, 57% of all data workloads will be processed in the cloud Read More »

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Networking Forecast: Cloudy with Increasing Zettabytes

With the onset of cloud, we’re being asked more and more by our customers about the architectural requirements that result from it.  While the customers have an instinct as to what’s needed, there seems to be less actual data to that effect than what they would like.  When confronted with a similar situation over 5 years ago about the network, we developed the Cisco Visual Networking Index which focuses on the amount of traffic carried across the network to the end user to help gauge the extent of infrastructure needed to support the data deluge.  Now with the network becoming inextricably linked to the data center and cloud, we realized we need to look at the other half of the equation as well to get a truly comprehensive architectural view.  To achieve this, we reviewed 30Tb of data each month, more than 45 million speed tests, analyst forecasts, and inputs from our customers.  The result?  The inaugural Cisco Global Cloud Index, released today.

Here are a few takeaways to consider:

  • Global data center traffic is estimated to grow four-fold to reaching a total of 4.8 zettabytes annually by 2015.
  • The vast majority of the traffic – 76% — surprisingly, doesn’t even hit the network but instead stays within the data center itself, as workloads are constantly being migrated to different virtual servers.
  • Of the total data center traffic, about 11%, or 130 exabytes of annual data center traffic in 2010 is considered part of the cloud  – however that amount is going to grow significantly in the next half decade, reaching more than a third of data center traffic, or 1.6 zettabytes annually, by 2015.

Cloud may be the concept-of-the-day for the industry, but with growth like that, it shouldn’t be discounted as a passing fad but rather a lasting trend whose impact will fundamentally affect network architectures going forward. Read More »

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