Telecommunications Infrastructure Archives - Page 4 of 40

The slump that shaped the second half of 2023 extended into the first half of 2024. Preliminary findings indicate that worldwide telecom equipment revenues across the six telecom programs tracked at Dell’Oro Group—Broadband Access, Microwave & Optical Transport, Mobile Core Network (MCN), Radio Access Network (RAN), and SP Router & Switch—declined 16% year-over-year (Y/Y) in 2Q24, recording a fourth consecutive quarter of double-digit contractions. Helping to explain the abysmal results are excess inventory, weaker demand in China, challenging 5G comparisons, and elevated uncertainty.

Regional output deceleration was broad-based in the second quarter of 2024, reflecting slower revenue growth on a Y/Y basis in all regions, including North America, EMEA, Asia Pacific, and CALA (Caribbean and Latin America). Varied momentum in activity in the first half was particularly significant in China – the total telecom equipment market in China stumbled in the second quarter, declining 17% Y/Y.

The downward pressure was not confined to a specific technology, and initial readings show that all six telecom programs declined in the second quarter. In addition to the wireless programs (RAN and MCN), which are still impacted by slower 5G deployments, spending on SP Routers fell by a third in 2Q24.

Supplier rankings were mostly unchanged. The top 7 suppliers in 1H24 accounted for 80% of the worldwide telecom equipment market and included Huawei, Nokia, Ericsson, ZTE, Cisco, Ciena, and Samsung. Huawei and ZTE combined gained nearly 3 percentage points of share between 2023 and 1H24.

Supplier positions differ slightly when we exclude the Chinese market. Even with the ongoing efforts by the US government to curb Huawei’s rise, Huawei is still well positioned in the broader telecom equipment market, excluding China, which is up roughly two percentage points relative to 2019 levels.

Even with the second half expected to account for 54% of full-year revenues, market conditions are expected to remain challenging in 2024. The analyst team collectively forecasts global telecom equipment revenues to contract 8 to 10% in 2024, down from the 4% decline in 2023.

5G RAN revenues accelerated rapidly between 2018 and 2022, propelling 5G RAN to account for around two-thirds of total 3G-5G RAN before stabilizing in 2023. With the pace of 5G construction now slowing, partly due to more challenging comparisons in advanced MBB markets, it’s important to note that growth prospects for FDD and TDD are not the same. TDD dominated investments in the first phase as operators focused on capitalizing on the larger channel bandwidths available in the upper mid-band. The mix between Sub-6 GHz FDD and TDD is expected to evolve going forward as FDD growth outpaces TDD.

While the upper mid-band offers large bandwidths of unoccupied contiguous spectrum, the combined FDD assets in the sub-3 GHz bands are significant. The amount of spectrum varies depending on the market. However, FDD generally provides around 100 MHz of combined uplink and downlink bandwidth when adding up the paired 600, 700, 800, 900, 1.4, 1.8, 2.1, and 2.6 GHz bands. Even if the spectral efficiency upside between 4G and 5G is limited, especially in non-massive MIMO configurations, FDD still comprises approximately a third to a half of the overall sub-6 GHz spectrum. In other words, sub-3 GHz deployments will play a growing role in the broader 5G roadmap as most 4G FDD spectrum will eventually become 5G.

Operators initially tend to focus on the upper mid-band before complementing it with narrow-band FDD deployments. However, results from 5G NR FDD-only deployments suggest that this spectrum holds significant potential. For example, in the Netherlands, the delay in C-band spectrum provisioning prompted local operators to optimize the use of existing assets, coordinating 4G and 5G technologies across high and low FDD bands to create a high-performance network. Umlaut testing has shown impressive average data rates and latency results in the Netherlands even with the C-Band delays.

In addition to the combined spectral resources in the sub-3 GHz bands, another major benefit is the improved RF propagation characteristics. The inversely proportional relationship between wavelengths and carrier frequencies means that the lower sub-3 GHz frequencies enhance coverage in rural areas, improve in-building performance, and elevate the uplink experience.

The situation is complicated by the small bandwidths scattered across multiple discrete bands, increasingly crowded and complex sites, challenging antenna form factors, and slowing physical cell site growth. At the same time, innovation is on the rise to tackle some of these challenges.

Site simplification is a top priority. Wideband technology enables multi-band deployments within a single radio, supporting both spectrum and power resource pooling. Most leading suppliers now offer multiband/wideband radios and antennas, which facilitate more compact site designs, simplify installation, and accelerate time to market. Some of the latest multiband radios can support three bands in a single device, and in some cases, they use just one PA (power amplifier) and filter, which helps reduce the radio’s form factor, weight, and power consumption.

Massive MIMO is not expected to play the same role with FDD as it did with TDD, in part because the 8T8R business case is more compelling in these bands. Even so, continued antenna innovation, combined with advancements in beamforming technology, will help boost the reach of higher-order and Massive MIMO in the FDD bands.

According to Huawei, intelligent beamforming combined with multi-band serving cell (MBSC) can potentially raise the overall FDD capacity and throughput by about 10x, relative to 4T4R.

5G Carrier Aggregation (CA) investments have been minimal to date but are projected to play a greater role in the future as operators expand the use of the sub-3 GHz spectrum. In addition to the potential for multi-Gbit data rates, operators can extend the mid-band range by aggregating low-band FDD carriers. For example, Elisa overcame uplink limitations in the upper mid-band by aggregating its C-band holdings with the 700 MHz carrier, which also enabled Elisa to double 5G throughputs at the cell edge (Nokia/Elisa case study).

Ericsson and T-Mobile recently demonstrated 3.6 Gbps speeds using 245 MHz of aggregated FDD and TDD spectrum. Additionally, Dish and Samsung showcased peak speeds of 1.3 Gbps using 75 MHz of FDD spectrum across three FDD bands.

In our latest 5G RAN forecast, we model FDD-based macro-RAN revenues to accelerate faster than the more mature TDD-based 5G RAN market, partly due to advancements in the 3GPP Release 17/18 specification paving the way for continuous high-bandwidth FDD deployments and multi-band FDD+TDD CA. The forecast rests on the assumption that the 8T8R gains relative to 2T2R/4T4R are sufficient to justify substantial 8T8R deployments (>20%). The future of FDD Massive MIMO looks positive, though the business case will be more limited compared to upper mid-band TDD Massive MIMO.

After attending Cisco Live in Vegas just two weeks ago, I returned to Las Vegas this week for HPE’s Industry Analyst Summit at HPE Discover 2024. It was HPE’s showcase to catch the AI lightning in a bottle, highlighting their ambitions and innovations in the rapidly evolving AI landscape. Below are three things that stuck out to me: HPE’s ambitious AI vision, cautious networking strategies, and the balance between Atmosphere and Discover.

HPE’s Ambition: Becoming the Enterprise AI Hardware Provider of Choice

Like many other vendors, HPE has overpivoted on AI. Labeling everything as AI dilutes genuine AI advancements. However, HPE’s effort to be the go-to enterprise hardware vendor for AI server hardware and solutions is noteworthy.

The newly announced NVIDIA AI Computing by HPE aims to accelerate the generative AI industrial revolution. This collaboration includes NVIDIA’s powerful GPUs, DGX systems, and software, combined with HPE’s advanced water-cooling from the high-performance computing world. The stack leverages NVIDIA’s Ethernet and InfiniBand solutions for internal networking. While HPE played it safe by using NVIDIA’s networking, it must sting the HPE networking folks to be sidelined in favor of NVIDIA’s components. This approach contrasts sharply with Cisco’s, where they ensured Cisco networking had a prominent role in their joint hardware stack with NVIDIA. Nonetheless, Jensen Huang, NVIDIA’s CEO, showing up at HPE Discover but not Cisco Live might signify stronger backing for HPE.

Playing It Safe in Networking Amidst Strategic Shifts

HPE Aruba Networking played it relatively safe at Discover 2024, likely influenced by the ongoing Juniper acquisition. When Juniper arrives, strategy and tactics will undoubtedly be up for grabs again. Earlier this year, I wrote a blog about what the acquisition means for HPE’s network security aspirations, and my colleague Sian Morgan wrote a great blog about how the acquisition will change the enterprise market.

Although I anticipated updates on the Juniper acquisition, the timeline remains unchanged, targeting the end of the year or early 2025. Competitors are capitalizing on this uncertainty, generating FUD to steer business away from HPE and Juniper.

Despite no groundbreaking networking announcements, HPE Aruba showcased a broad spectrum of enhancements across its portfolio. During David Hughes’ keynote, Chief Product Officer of HPE Networking, he discussed several key advancements. A highlight was the push into “universal ZTNA” to bridge SSE’s wide-area ZTNA down into the campus with the new Aruba Local Edge. This solution identifies and enforces ZTNA on local traffic. While HPE is not the first in this area, it is far from the last; universal ZTNA is an area of active development in the industry.

Additionally, Hughes demonstrated various AI-ops demos and use cases, including AI-powered network management tools that enhance visibility, anomaly detection, and automated troubleshooting. Networking hardware also received attention with new campus switching, data center switches, SD-WAN hardware, Wi-Fi 7 access points, and even private 5G solutions. Although there were no earth-shattering networking announcements, the range of enhancements underscores that HPE Networking is not standing still or paralyzed by the ongoing acquisition of Juniper.

Balancing Atmosphere and Discover: Networking’s Place in HPE’s Vision

This year marked the first time Atmosphere, HPE Aruba’s dedicated conference, was integrated into HPE Discover. Previously, Atmosphere had a distinct identity, fostering a strong networking-focused culture. However, at HPE Discover, networking seemed to play second fiddle to the larger server and storage businesses. Many attendees lamented the loss of focus on networking and the unique culture that Atmosphere cultivated. The orange shirts of “Airheads” (Aruba’s affectionate term for its customers) were present but overshadowed by the more conservative attire of the broader HPE audience, whose only flare was a pin of HPE’s green rectangle logo.

I hope the Juniper acquisition will restore balance, bringing networking back to the forefront at future conferences. Atmosphere’s unique culture and focus should be preserved and better integrated into HPE Discover, ensuring networking and its innovations receive the attention they deserve.

Conclusion: A Glimpse into the Future

HPE Discover 2024 showcased HPE’s ambitions to lead in AI while navigating strategic shifts in networking. The partnership with NVIDIA highlights HPE’s commitment to delivering cutting-edge AI solutions, even if it means sidelining its networking components. The cautious approach in networking reflects the ongoing Juniper acquisition, with competitors eagerly watching and spreading FUD.

As HPE moves forward with the Juniper acquisition and continues to innovate, there’s hope that the unique culture of Atmosphere and the focus on networking will find a balanced place within the broader HPE and the HPE Discover show. The future promises exciting developments, and I look forward to seeing how HPE navigates these changes, driving innovation and growth in AI and networking.

I just returned from Cisco’s Press and Analyst Conference at Cisco Live 2024 in Las Vegas, and it was quite the spectacle. The event was a grand showcase of Cisco’s attempts to reinvent itself amidst a saturated market. While there were some genuinely impressive innovations, it was hard not to feel a bit skeptical about some of the grandiose claims. Here are my key takeaways, organized into three major themes: AI Integration, Security Innovations, and The Future of Observability.

AI Integration: A Strategic Embrace

Cisco made it clear at Cisco Live 2024 that AI is central to its future. The event was filled with AI-focused sessions, panels, and keynotes, all highlighting how AI will drive the next wave of innovation at Cisco. In fact, the term “AI” was used over 300 times across 11 presentations, or on average about 27 times per 45-minute presentation. There was no doubt that Cisco wanted to impress the importance of AI, but was it really necessary to use it so often?

Chuck Robbins, Cisco’s CEO, emphasized that while Cisco remains a networking company at its core, embracing AI is essential for staying at the forefront of technology. One of the standout announcements was the AI-powered HyperFabric, developed in collaboration with NVIDIA. This new hardware is designed to support AI clusters, ensuring that Cisco remains a critical player in the infrastructure needed for AI workloads. The practical applications of AI in automating network management and optimizing performance are genuinely beneficial, promising to reduce complexity and improve outcomes.

However, it’s important to temper expectations. While AI holds great promise, the real test will be its implementation and whether it can deliver consistent, tangible improvements. Cisco’s AI strategy is ambitious, but it’s a necessary step to ensure they stay competitive in a rapidly evolving market.

Security Innovations: Promising but Future-Focused

Security was another primary focus at Cisco Live, taking second billing to AI. Cisco is committed to enhancing its security offerings, though many innovations were announcements for future products expected over the next six months.

One of the significant security announcements was related to the upcoming Hypershield, set to launch in August. This initiative, now expanded with AMD DPU integration, aims to provide advanced AI-driven micro-segmentation and threat detection for distributed workloads. Additionally, a new Cisco low-end firewall (1200) is expected in October, reinforcing Cisco’s dedication to the firewall market, where it once was the dominant market share leader but now stands far behind Palo Alto Networks.

A significant part of Cisco’s security strategy involves integrating Splunk, which was acquired earlier this year. Splunk’s capabilities in providing visibility into the internet and cloud are crucial for understanding how external factors impact network performance. While Splunk is still finding its home within Cisco, the integration process is underway and will be pivotal for future security innovations.

Cisco’s security announcements also included the new Cisco Security Cloud Control, the unified management for Cisco Security Cloud, its AI-driven, cross-domain security platform, and partnerships with Microsoft and Google. These partnerships are noteworthy, demonstrating Cisco’s strategy of collaboration to enhance its security offerings without having to build out missing capabilities themselves. However, the true impact of these innovations will be seen once the products are fully rolled out and integrated.

The Future of Observability: Integrating Splunk

Observability and digital experience management were also prominent themes at Cisco Live. These areas are critical as they represent the evolution of traditional network management into more holistic, software-centric solutions. Cisco is positioning itself as a leader in this space, recognizing that as networks become more complex, the need for comprehensive observability tools becomes paramount.

A significant part of this strategy is the integration of Splunk and cross-pollination with standing Cisco products, such as Thousand Eyes. At Cisco Live, integrating Splunk with other Cisco products was a significant highlight, showcasing how observability can lead to better decision-making and improved operational efficiency. However, Splunk feels somewhat separated from the Cisco mothership. Given that the acquisition closed only a couple of months ago, this is understandable. The integration process will take time, and it will be interesting to see how Cisco fully incorporates Splunk’s capabilities into its broader portfolio.

A Networking Giant’s Evolution

Cisco, the blue-blood networking company, had a surprisingly limited number of CEO-caliber network infrastructure announcements. Other than the HyperFabric, there were no major hardware or networking revelations directly from Chuck Robbins or his staff. On the one hand, it’s refreshing to see Cisco focus on innovative technologies beyond the traditional “speeds and feeds.” On the other hand, isn’t that precisely what made Cisco the powerhouse it is today? The lack of significant networking announcements might leave some long-time Cisco followers questioning if the company is straying too far from its routing and switching roots.

Final Thoughts: A Bold Step into the Future

Cisco Live 2024 showcased a company making bold moves to stay relevant and competitive. The emphasis on AI, the continued focus on security, and the integration of observability tools like Splunk are all part of Cisco’s strategy to expand its market reach. While there are valid reasons to be cautiously optimistic, the real challenge will be turning these ambitious plans into concrete results.

The AI initiatives, while promising, need to prove their value in real-world applications. Security improvements, though many are future-focused, show a commitment to staying ahead of threats. Observability, particularly with the integration of Splunk, represents a significant step forward, though it will require time to realize its full potential.

Cisco Live 2024 left me with a sense of cautious optimism. The company is clearly making strategic moves to adapt and innovate. Whether these efforts will pay off remains to be seen, but one thing is sure: Cisco is not standing still. They are actively shaping their future, and it will be fascinating to see how these initiatives unfold in the coming year and beyond.

A correction was made on June 14, 2024: An earlier version of this blog incorrectly referred to Cisco Security Cloud Control as ”an AI-driven platform for unified security management.” Cisco Security Cloud Control is the unified management interface for Cisco Security Cloud, which is Cisco’s unified, AI-driven, cross-domain security platform.

In a blog post published earlier this week, details were provided on why CommScope unexpectedly decided to acquire the cable assets of Casa Systems for $45.1 million. The primary reasons discussed included strengthening CommScope’s cable presence and achieving the necessary scale for the transition to virtualized Cable Modem Termination Systems (vCMTS).

Another significant factor in CommScope’s decision to pursue this acquisition is the access Casa’s already-deployed Axyom vBNG (Virtual Broadband Network Gateway) platform to complement CommScope’s PON OLT and ONT platforms and provide operators with a more comprehensive fiber portfolio. The Axyom vBNG has already been deployed with Mexico’s Izzi as well as with other tier 1 operators that have not yet been announced publicly.

Similar to the vCMTS market, the vBNG market is still in its early stages of development, though vBNG deployments are expected to increase significantly in 2025 and beyond as operators continue to move away from BNG functions integrated directly on centralized, hardware-based edge routers, and look to separate control and user plane functions.

vBNGs serve as the access point for broadband subscribers, managing the connection between their modem and the service provider’s broadband network. vBNGs authenticate and manage those subscriber sessions, aggregate the sessions, and then route them to the service provider’s network. Additionally, vBNGs offer traffic shaping functions to deliver Quality-of-Service (QoS) features for specific subscribers, such as traffic prioritization and rate limiting.

As Fiber to the Home (FTTH) deployments and subscriber sessions continue to increase, operators will need to scale and distribute their BNGs to enhance network resilience and simplify IP address management and subscriber authentication at the edge rather than backhauling all of that traffic to a centralized BNG. This is as much the case for larger, tier 1 operators as it is for smaller operators who don’t necessarily need a large, centralized BNG. vBNGs running on COTS servers provide all operators with the flexibility to scale their throughout and simultaneous session management with their subscriber base.

Operators such as AT&T, Deutsche Telekom, Telefonica, Vodafone, and Comcast are all active in the standardization and development of vBNGs and there is a growing population of smaller ISPs trialing vBNGs from a group of vendors that include Casa Systems, Ciena, NetElastic, Six Wind, 5X9 Networks, UfiSpace, DriveNets, rtBrick, and Nokia.

Certainly, with the ongoing global subsidization efforts to expand fiber access, now is the right time for operators to begin rethinking how they architect their subscriber management functions. Even beyond fiber, fixed wireless access (FWA) providers are also looking at vBNGs that can provide the Access Gateway Function (AGF) of a 5G core. The AGF provides nearly all the same functionality of a vBNG, but is also focused on facilitating the interworking of wireline devices with the 5G core. For any mobile operator delivering FWA services, the AGF can play a critical role in the management and authentication of FWA CPE and subscriber sessions.

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