It has been really interesting following the data center market and AWS over the years. Watching Microsoft and Google playing catch up, the increasing consolidation of the multi tenant data center operators and an increased move to the edge. Lately I have been reading about AWS a lot more and re:Invent so far this year has been been simply mind boggling!
I love technology IoT, 5G, DWDM, PON, silicon photonics, the cloud, data centers, Terabit hollow fibre optic cable, 10-40 Gb/s and even 100Gb/s microwave radio (DARPA), NFV, C-RAN you name it.
The telecoms industry has been struggling for some years to keep up with the exponential growth in traffic demand and the dizzying array of solutions. Revenues are declining, their core services of voice and messaging are being eaten by over the top plays and undermined by regulators through net neutrality, blocking M&A and in Europe the regulators have also taken away roaming revenue.
Ultimately the operators are findinging increasingly difficult to justify investments. This is causing market failures and under investment relative to societies needs which in turn means governments are having to invest directly (National broadband schemes) to try and bridge the gap. The lack of investment is also causing big problems for the big webscale companies as it is limiting their growth. They have recognised the problem and are looking to either pay operators for carrying data (e.g Facebook India) or find ways to take out costs out for operators (e.g. facebook TIP) or look to build the networks themselves (Google Fibre).
Motorola, Siemens, Alcatel, Nokia have all consolidated into one and it is sad to read about Ericsson’s problems, a company I learned so much from as a youg(ish) CTO. Perhaps the solid, safe, nordic culture cannot shift their mind set to the high risk/high reward BHAG culture of the moonshot generation that typifies the webscale giants? It makes sense to go All-in as they say in AWS world! Looking at where technology and companies like AWS are headed I think it is only going to get worse for the telecoms equipment manufacturers.
A good friend (thanks Dermot!) recently shared an article titled Amazon is eating the software (which is eating the world). It’s great read. Many still see AWS as a utility compute, storage and networking provider and have not really grasped their move to create the biggest and most efficient software development environment and market. There were lots of amazing new moves announced at re:Invent this year. From snowballs and snowmobiles, greengrass and IOT there are too many to go into detail here. If you have not been following you can catch up on their livestream page. One announcement that particularly jumped out for me was there addition of FGPA compute instances. FPGA’s are pretty important in cellular baseband processing (the hard compute and processing work at a radio base station).
When you add FGPA compute to a hyper efficent software development add in some open source 5G with a sprinkling of fiber broadband projects and some Gigabit microwave radio…….. well it may take a bunch of rocket scientists to land a moodshot but I think most can see where I think this is all going to land?