As Asia Pacific becomes home to innovation and growth in this digital era, a decade where industry 4.0 vision will be realized. It is time to move past the legacy and layered network architecture to evolve SP networks into a digital platform that is enabled to create value plays for each enterprise vertical that benefits from a digital connection.
The world is waking up to 5G. Accelerated digitization of the industries can only be realized by strengthening and enhancing the infrastructure, the infrastructure that is intuitive, open, service agile, and automated.
Enterprises are looking forward to transforming their networks to harness the values of digitization: Efficiency, agility, and bottom-line growth. As a result, SP networks need to be extended to enterprise networks to bring in an enormous amount of value creation through efficiency and service agility.
But the task is easier said than done. The transformation of infrastructure is a journey on which many of our service providers have embarked but need to be accelerated to reap the benefits of digitalisation. Those SPs that d this proactively will be the winners in this decade, the decade of digitisation and Industry 4.0.
The Legacy and Layered Hurdle
Living long with existing architectures will prove to be cost-inefficient and will deter the Service Providers’ ability to capitalise on the booming digital opportunity.
The existing network infrastructures are complex, opex guzzlers, and unable to leverage technologies like AI/ML, telemetry, and segment routing(SRv6).
Traditional networks aren’t scalable and the expansion of these networks has occurred in an incremental fashion. The linear addition of network infrastructure, classified as capital expenditure for the service providers has eventually resulted in the high complexity of the network as we know it today.
Also, the legacy nature of network architecture requires manual intervention at various levels and is susceptible to complex management and inflexible service and subscriber management.
The Shift to Optical Routed Network Architecture
In a recent study conducted by IDC and CISCO, titled Routed Optical Networking, the respondents stated the increasing speed of innovation and change to have a significant effect on the strategy of the company. This is followed by changing customer behaviour due to socio-economic and/or cultural changes and new technology entrants in the market.
The latter half of the decade and the last year especially has been a movement in cultural and behavioural change. There has been an exponential growth in the usage of OTT, thereby increased video streaming, adoption of cloud computing to keep the remote work functioning, and diversification of enterprises into multiple industries. This has challenged the economic model of building the networks in the legacy way, where optical and IP networks are standalone verticals in the network architecture.
IDC’s estimate puts the growth in traffic demand from 5G (and fiber broadband access) to 10X-15X, or 25-31% compound annual growth rate (CAGR) in the next decade. IDC estimates by 2023, there will be 1 billion 5G connections globally. The 4G markets, in addition, average monthly data usage of 8-18 GBytes.
As the Asia Pacific region will be home to increased innovation and growth in this decade, it is best suited to reimagine the new opportunities emerging out of industry 4.0, and service providers have a responsibility to create network architectures that are efficient, service agile, and intuitive to enable massive monetisation that digitalization and industry 4.0 is offering. The leaders will be the ones that will fast-track their journey to this evolving digital platform and pivot their business to this new normal faster.