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It’s all about the photonic mesh in the backhaul for Rakuten’s brand new mobile network, and Nokia’s switches are going to help make it work.
Rakuten Mobile is the talk of the telecoms town these days, not only because it’s disrupting the Japanese mobile market with some aggressive pricing, but because it has built its entire network from scratch, using the latest whizzy technologies. Everything is virtualized and cloud-native, just as we’ve been talking about for years, so Rakuten is essentially showing the world how it should be done.
It’s not much good having all that cloudy agility, however, if you’re still constrained by your physical backhaul network, which is where optical mesh networks come in. Now, we’re not going to pretend to be experts on the topic, but the underlying point of them seems to be to provide much more redundancy and flexibility than traditional fixed networks.
The word ‘photonic’ seems to be interchangeable with ‘optical’, at least in this context, and Rakuten has only gone an built its own photonic mesh mobile backhaul network, hasn’t it. Everyone knows you can’t just whack regular optical switches into such a cutting-edge thing, which is where Nokia comes in. Rakuten will use the Nokia 1830 Photonic Service Switch, which is a handy deal win considering it was competing with a bunch of US companies for whom switches are their main event.
“The introduction of 5G will require a network that can support dramatic increases in bandwidth in a dynamic fashion,” said Sam Bucci, Head of Optical Networking at Nokia. “Nokia is proud and excited to partner with Rakuten Mobile to build a fully reconfigurable photonic mesh network to meet the 5G networking challenge at the lowest total cost of ownership.”
“Rakuten Mobile is creating the world’s first end-to-end fully virtualized cloud-native mobile network, delivering unprecedented network agility and disruptive economics to end users,” said Tareq Amin, CTO, Rakuten Mobile. “Nokia’s Photonic Service Engine 3 coherent chipset and integrated ROADM technology enables us to achieve unprecedented levels of integration and performance building the mobile network for 4G and 5G.”
Apparently this is also the first time ever a photonic mesh has been created for a mobile backhaul network. If even half of the boasts Rakuten is making about its network are true then NTT Docomo, Softbank and KDDI are in all sorts of bother. The theory is that all this extreme efficiency will make Rakuten’s opex much lower than its rivals, meaning they will either have to spend big on network modernization or kill their margins to compete.
US networking giant Cisco has unveiled a major refresh of its core technology, including a first-ever unified silicon architecture, a new OS and a new platform.
Cisco is positioning this big reveal as its ‘internet for the future’ strategy, which seems like a more hyperbolic way of describing a major product refresh. At the core of it is Cisco Silicon One, a new microarchitecture that is designed to be flexible enough to use anywhere in the network. It makes its debut in the Cisco 8000 router series networking platform that also features a new operating system called IOS XR7.
“Innovation requires focused investment, the right team and a culture that values imagination,” said Chuck Robbins, CEO of Cisco. “We are dedicated to transforming the industry to build a new internet for the 5G era. Our latest solutions in silicon, optics and software represent the continued innovation we’re driving that helps our customers stay ahead of the curve and create new, ground-breaking experiences for their customers and end users for decades to come.”
“Cisco’s technology strategy is not about the next-generation of a single product area,” said David Goeckeler, GM of the Networking and Security Business at Cisco. “We have spent the past several years investing in whole categories of independent technologies that we believe will converge in the future — and ultimately will allow us to solve the hardest problems on the verge of eroding the advancement of digital innovation. This strategy is delivering the most ambitious development project the company has ever achieved.”
Cisco has some heavyweight partners in this endeavour, with Google Cloud and Facebook’s TIP initiative speaking up in support. The broader narrative is that this is all about supporting 5G and all the good stuff we’re promised it will bring, which implies a renewed focus on the operator market. You can read in-depth analysis of the move on Light Reading here.
Optical networking company Ciena posted positive results for the first quarter of 2019, with total revenues of $778.5 million beating analyst expectations.
There have been whispers in corners of various conferences that a Huawei ban could benefit some, and it may well be having a positive impact for Ciena. While there are numerous other companies which would compete with Huawei in the optical equipment segment, with Ciena one of the few ‘pure-play’ companies it might have a more notable impact on the financials.
That said, irrelevant of where the favourable fortune has come from investors will be happy. $778.5 million represents a 20.5% year-on-year increase for the first quarter, while nearly all geographical markets have shown healthy growth.
“We began fiscal 2019 with a very strong first quarter performance, including outstanding top and bottom line growth as well as continued market share gains,” said Gary Smith, CEO of Ciena. “We believe that the combination of our leading innovation and positive industry dynamics will enable us to further extend our leadership position.”
Net income for the quarter stood at $33.6 million, though this is incomparable to the same period of 2018 which registered a loss of $473.4 million thanks to President Donald Trump’s US tax reform.
Looking at the regions, in the US, a market which now accounts for 62% of the company’s total revenues, the earnings grew just over 20% to $485.5 million, while 20% growth was also registered in the APAC region. The big success story however was in Europe, where the team grew the business by 32% to $129.2 million. This is still only 16.6% of the total haul for Ciena, but more geographical diversification will certainly be welcomed.
For Ciena, Europe could be a very interesting market over the next couple of months. With Huawei coming under increasing scrutiny globally, telcos will look to further diversify supply chains to add more resilience and protect themselves from potential government bans. While the anti-China rhetoric being spouted out by the White House is losing momentum, the European Union is reportedly looking some sort of ban, even if this puts the Brussels bureaucrats at odds with some member states.
For such vast investments, telcos will be looking for certainty and consistency from government policies. When looking at Huawei as a potential vendor, telcos will naturally be nervous, even if they don’t want to admit it.
With Huawei’s ban set to have little impact on the US market, it is not a major supplier to the market historically, the Europe could be a hidden goldmine for Ciena.
Interestingly enough, this scenario also seems to be paying off dividend in the APAC markets as well. Smith notes the success in the APAC region has come from Australia, Japan and Korea, three markets where Huawei has either been explicitly banned or is receiving a rather frosty welcome.
The world’s biggest MNO – China Mobile – recently held a central bid to supply equipment for its regional optical transport network, in which it ranked Nokia top.
The gig seems to be that a bunch of vendors are going to help out with the deployment of an optical transport network for 13 city metro and two provincial backbone networks, but that China Mobile will apportion the work between them according to some arbitrary ranking system. The good news for Nokia is that it came top of that table and, as a consequence, will get more optical networking business.
The usual array of networking virtue is being ascribed to whatever Nokia is serving up for China Mobile here. It’s all about agility, flexibility, scalability and all the other -ilities. And, of course, it’s so ready for 5G you wouldn’t believe it.
“We are very pleased to work closely with China Mobile to provide the optical technology for its most advanced networks today and in the future,” said Yu Xiaohan, head of the China Mobile customer team at Nokia Shanghai Bell. “We’ll continue to fulfil our mission by making people’s life easier as we create the technologies that connect the world.”
In other Nokia Far-Eastern news it has announced the opening of its Cloud Collaboration Hub in Singapore, which is somewhat ominously described as an ‘execution centre’ where multivendor cloud services can be tried out. It joins existing ones in the US and UK, all of which exist mainly to help operators get ahead on the cloud game.
“With the launch of the Cloud Collaboration Hub in Singapore, we will help operators in Asia Pacific and Japan select the right transformation strategy and build their revenue drivers and business cases for cloud-based solutions,” said Sandeep Girotra, head of Asia Pacific and Japan at Nokia. “This will accelerate operators’ moves towards becoming digital service providers at a crucial moment when technology is undergoing a paradigm shift, anchored by trends such as 5G, the Internet of things and the cloud.”