Don’t get me wrong, I love copper wiring. With a little silicon magic, very good cable, and decent crimping, you can get 10 GigE connections for short runs without a lot of headaches. At longer distances, DSP processing and clever algorithms is squeezing out more speed from existing copper plant For people who already have copper in place and some certainty with cable quality, copper is great.

But if you want to go past 10 Gbps without having to recable down the road, fiber is the way to go. Optical fiber today is capable of supporting speeds of 100 GigE on multiple wavelengths and has a future path to 400 GigE and Terabit Ethernet (1TbE) speeds. Invest in fiber today and you are effectively future-proofed for network speed increases without having to worry about pulling it on the (inevitable) day when you have to put in optical for higher-speed connectivity within the data center and between it and the rest of the world.

Over the past twelve months I’ve seen a couple of new wave ideas for high-speed networking within the confines of the data center, but both are based on line-of-sight schemes. Basic off-the-shelf LEDs are being used by the Fraunhofer Heinrich Hertz Institute to create high-speed , no-wire data connections. Initial experiments demonstrated rates of up to 800 Mbps and up to 500 Mbps at a system exhibited at trade shows. More recent work has demonstrated rates of 1 Gbps for single light frequency, adding up to 3 Gbps when using three different color LEDs. Given the relative infancy of GigLED, I wouldn’t be surprised to see speeds of up to 10 Gbps with some tinkering.

Short range RF wireless networking is also a potential option for the future. Low-power radios using the 60 GHz radio frequency are being rolled into “stock” 802.11 a/b/g/n WiFi chips to provide up to GigE speeds for moving around HD video and other data types between storage, PCs, tablets, and big screens. Next-generation devices built around the unlicensed 60 GHz band offer the potential for transmission speeds close to 11 Gbps at lower power.

Current applications for 60 GHz are focusing around PC-esque “personal network” applications to get rid of cables for docking stations but Intel researchers are looking at 60 GHz to provide an evolutionary step beyond vanilla Wi-Fi in 2.4 GHz and 5 GHz bands, boosting data rates to 1 to 2 Gbps.

However, both GigLED and 60 GHz share some of the disadvantages as well as advantages. Both technologies are effectively “same room.” LEDs require line-of-sight between transmission nodes — something researchers think would work wonderfully with light bulbs (It does, however, redefine the term “lights out” data center).

The 60 GHz band is almost as “limited” as LEDs, requiring nodes to effectively be in the same room and able to bounce signals off the floor or ceiling. With 60 GHz, you don’t need pure line-of-sight, but you’re not going to be able to be in the next room without some sort of relay or repeater.

Both GigLED and 60 GHz are still in their earliest days of implementation. I expect some experimentation with 60 GHz for in-room data center networking in the years to come, while GigLED will get some more polishing before it shows up as something more than a neat science project.

If you want to play the “green” card, glass is cleaner and potentially safer than copper. Animals like to chew on phone lines. The price of copper has lead to unsavory types cutting and stripping cables out of exposed physical plant — power and data — for a quick trip to a recycling center. Glass doesn’t have that allure because it’s cheap and easy to recycle.

Speaking of connecting your data center to the rest of the world, service providers would prefer you to be on fiber. Fiber means you can get bandwidth via a simple optical Ethernet handoff, rather than having to wrestle with copper and all the (aging) bits and pieces necessary to go from optical to copper to deliver bandwidth speeds under 100 Mbps.

And the faster you want your broadband connection, the more you really need fiber for your and the service provider’s sanity. Independents can provision service of up to 100 Mbps over copper with pair bonding and clean wires over short distances, but they want you on their fiber network because they don’t have to pay the incumbent copper-owners every month for those pairs. Meanwhile, the incumbent wants you off the copper because of all the legacy gear it doesn’t want to maintain.

If you want a moral to this story, it is: Think glass. Migrating to fiber and slowly moving away from copper will ultimately reduce your headaches and should save you some money in the long run.

SDN was conceived as a method to control and virtualize elements inside data centers, not between them. But the testbed at Marist College in Poughkeepsie, N.Y., stretches the old bounds of the concept.

It utilizes data center switching, server and storage technology from IBM and long-distance optical networking equipment from ADVA Optical Networking among three simulated data centers. It all operates under the control of open-source SDN controllers from FloodLight and eventually the OpenDaylight Project. The SDN controller marries the network’s packet and optical domains by leveraging the OpenFlow protocol, modified with certain key extensions to deal with the analog nature of the optical network. These include optical-specific constraints in areas such as sequential lightpath setup/teardown, optical power balancing, switching and wavelength continuity.

Most SDN testbeds focus on the local area network (LAN) inside the walls of the data center. The Marist testbed, however, is different in that it extends SDN functionality to orchestrate both the LAN and the wide-area network (WAN). The testbed shows how resources can be cost-effectively pooled among data centers by automating wavelength provisioning, commissioning and assignment, while equipping the network to dynamically respond to on-the-fly changes in application workload and traffic patterns.

These are timely capabilities for Internet2 communities and telecommunications and cloud service providers. Given the rise of on-demand resource and application models in the cloud, such network operators are dealing increasingly with dynamic workloads and traffic patterns that can change quickly in response to application demands. Network protocols that were not designed to address such requirements are making service provisioning and network scalability more cumbersome and costly. SDN, on the other hand, leverages a centralized, logical view of the network that can be easily manipulated via software to implement complex networking rules. The resulting benefits include support for multi-vendor environments, more granular network control (at session, user and device levels), improved automation and management, accelerated service deployments and unprecedented scalability and flexibility at lower cost.

Let’s look more closely at how the Marist SDN testbed works.

In the first step of testing, reconfiguration is initiated from the SDN controller, which, after performing necessary calculations, programs the wavelength division multiplexing (WDM) system and OpenFlow switches to set up a flow between two geographically dispersed data centers. Triggered by preset scheduling or through a web portal, a path and bandwidth is released to the given application(s).

In the second step of testing, reconfiguration is initiated from the application itself. In this scenario, the application requests a path and bandwidth from the SDN controller, which then programs the WDM systems and switches and releases bandwidth accordingly.

When completed, the “application-aware” SDN controller releases the bandwidth back to the LAN/WAN pool. 

Various use cases can be demonstrated in the testbed.

For example, one growing use case is workload balancing. In the Marist scenarios, vmWare vMotion could be used to move virtual machines and vStorage to move the associated files both in and between data centers for more effective use of resources. In this scenario, a system (server or storage) could be reaching maximum capacity, which would trigger the need to move virtual machines to another less utilized server and storage in a remote cloud data center. The application could request two 10 Gbit/s wavelengths between data centers A and B. The SDN controller would check to see what switches, optical gear and other network resources are available and then provide bandwidth back to the applications. Once virtual machines and files have been moved from Data Center A to Data Center B, the application would give the 10 Gbit/s wavelengths back to the metro pool, and the same process can be demonstrated between Data Center B to Data Center C. (See Figure B.)

Another possibility is flooding a link with virtual machines, storage and/or video traffic, causing another 10 Gbit/s wavelength to be activated when capacity reaches a given threshold—say, 90 percent—on the first link. This is much more efficient and cost effective than having a second 10 Gbit/s link just for backup and only getting one half the bandwidth. This particular 10 Gbit/s link comes from a “pool” that can be shared with other 10 Gbit/s links, providing “wavelengths on demand.” (See Figure below)

The testbed demonstrates the basic functionality of an SDN-enabled service provider network and illustrates the compelling cost efficiencies and revenue opportunities enabled by new levels of dynamic provisioning and automation across network layers.

The potential real-world applications that could be enabled by the capabilities demonstrated in the Marist testbed are promising. More powerful services for disaster recovery and business continuity could be supported among multiple data centers separated by distances up to 300 kilometers. In the event of a natural disaster such as a hurricane, it would be beneficial if the inter-site network could quickly be reconfigured to facilitate transferring all mission-critical data and applications outside the affected region.

“Big Data” analytics could be supported among several data centers with a prescribed traffic pattern and network bandwidth allocation that changes based on workload. Fiber-optic links could be combined into a larger virtual pipe to accommodate a momentarily heavy flow of traffic—with the links automatically separating under supervision of the controller when the rush is over. Or, a network administrator could isolate certain long-distance flows in the network for differentiated, on-demand “express lanes” for time-sensitive voice, video and data traffic.

SDN across network layers via OpenFlow, as demonstrated in the Marist testbed, stands to transform networks from infrastructure to business-critical service-delivery platforms. Network control and management is simplified, and more agile deployment of network services is enabled. For Internet2 communities and telecommunications and cloud service providers, such new functionality translates into significant cost efficiencies and the ability to seamlessly adapt to rapidly changing needs—benefits that address the most pressing challenges that these network operators today face.

Today’s mobile backhaul network architectures will face additional challenges with LTE-Advanced on its way to being introduced by all major mobile network operators. Inter-cell interference coordination (ICIC) and coordinated multi-point transmission (CoMP) are two functions from the LTE-Advanced toolkit that target a better user-experience at the cell edge. ICIC limits cross-talk by coordinating spectrum allocation across multiple cells. CoMP allows multiple base stations to simultaneously serve a user device and increase the receive power level and therefore capacity.

Both functions require very short latencies across the backhaul network to achieve real-time coordination between base stations. This implies implementing the X2 interface as defined in the LTE and LTE-Advanced standard. It facilitates direct communication between adjacent base stations. In order to meet stringent latency requirements of less than 1ms, the physical and logical path of the X2 interface needs to be as short as possible. Supporting this requirement is not trivial for most of the existing mobile backhaul deployments. Today’s underlying architecture is often designed according to a strict hub-and-spoke principle, where traffic distribution and re-direction is architected in the distribution layer of the backhaul network.

In addition to low-latency connections, base station clocks need to be in phase to enable proper operation of ICIC and CoMP. This leads to highly accurate phase or time-of-day synchronization. Most 3GPP base station clocks are currently synchronized on frequency only, since accurate phase synchronization was not a requirement until now.. The new LTE-Advanced functions, however, require base stations to be in phase with an accuracy of 500ns to efficiently operate ICIC and CoMP. This is nearly impossible to achieve without on-path support, i.e., the backhaul network needs to support the timing distribution architecture actively. The ITU-T Study Group 15Q13 is currently defining telecom profiles facilitating end-to-end frequency and phase synchronization across packet-based backhaul networks with on-path support.

Mobile operators will also start deploying LTE TDD radio interfaces operating in unpaired spectrum. Many operators have already acquired unpaired spectrum since TDD provides more flexible scaling of the up and down link capacity and has additional benefits to the overall architecture of the radio access network. As ICIC and CoMP, TDD requires phase alignment of neighboring base stations in addition to the traditional frequency synchronization used in mobile networks today.

Heterogeneous radio access networks (HetNets) create further challenges. HetNets are quickly becoming a reality, with radio access networks being composed of different types of base stations for maximizing access capacities, optimizing user experience and reducing cost. Base stations can differ in terms of capacity, reach, transmission power and RAN technology, including 3G, 4G and WiFi.

No matter what type of base station a user is connected to, he should have a superior user experience and be able to roam seamlessly between base stations. The HetNet architecture drives capacities but also requires the backhaul network architecture to be more flexible and scalable. And it will evolve into a more heterogeneous architecture connecting all base stations in a cost effective manner. Backhaul service providers and mobile network operators are looking for complete solutions to connect macro cells and small cells including metro cells, pico cells and femto cells in private locations.

LTE-Advanced and the tighter coordination between base stations will therefore challenge existing backhaul networks with respect to capacity, latency and synchronization performance. Current architectures need to evolve, enabling mobile network operators to seamlessly migrate to LTE-Advanced and enhance cell capacity, coverage and ultimately mobile user experience. The distribution of timing information for frequency and phase synchronization of the radio access network constitutes a particular challenge. Backhaul networks now need to actively contribute to timing distribution and provide on-path support. This is a new requirement for most backhaul service providers. And it is more than just providing on-path support. Highly accurate synchronization of base stations is elementary for stable operation of the radio access network. Synchronization performance therefore needs to be monitored and assured, just in the same way as performance assured Carrier Ethernet services evolved from basic best effort connectivity.

And there is more to come. Since further increasing radio access network performance can only be achieved by very tight coordination between base stations, the base band architecture of the radio access network is foreseen to change as well. Controlling distributed antenna systems from a centralized baseband unit promises additional gains and system simplification. With such a centralized architecture, the requirements on backhaul connectivity will change significantly. Capacities in the range of multiple Gbps and ultra-low latency are key attributes when connecting radio heads to the baseband unit by the Common Public Radio Interface (CPRI).

Simple things are tedious. The challenge is more exciting.

This decision will come about – not because they want to service the residential market – but driven primarily by economic development. And while they are running fiber rings about the city, why not extend those services to the consumers, who remain under-served by the incumbent.

The Gigabit Challenge

On January 18, 2013 FCC Chairman Julius Genachowski issued his Gigabit Challenge – challenging broadband Internet providers and local and state governments in the United States to bring at least one gigabit-speed Internet community to all 50 states by 2015.

This follows one of the 6 mains goals of the National Broadband Plan (Goal #4) that “every American community should have affordable access to at least 1 gigabit per second broadband service to anchor institutions such as schools, hospitals and government buildings.”

The current thinking is that once community anchors are connected to gigabit speeds, it would presumably become less expensive and more practical to get the same speeds to homes.

This is a lofty goal – but not impossible. At present, Gigabit broadband networks exist in only thirteen states – with the majority provided by municipalities and the remainder a combination of competitive operators and public-private partnerships. However, activity by two organizations – The University Community Next Generation Innovation Project (also known as Gig.U) and US Ignite are hoping to not only accelerate the timeframe, but expand beyond the current target.

• Gig.U is a group of 30 leading research universities from across the United States seeking to accelerate the deployment of ultra-high-speed networks to leading U.S. universities and their surrounding communities.
• US Ignite is focused on the creation of next-generation Internet applications that provide transformative public benefit across six focus areas: Education & Workforce; Energy; Health; Public Safety; Transportation and Advanced Manufacturing. Their goal is over the next five years is to create 60 next-generation applications and 200 community test beds where applications can be researched, developed, tested, refined, and deployed.

US Ignite is working together with Gig.U participants to create these national test beds for next-generation applications.

The Cost Challenge

In many instances, the two biggest reasons major network operators are not investing in new infrastructure to support 1 Gigabit are (1) cost and (2) the belief that “there are not many applications which would require these types of bandwidths in the foreseeable future”. Another reason cited for not making investments in faster networks has been lack of demand. Many operators state that in markets where they are offering premium speeds, only a very small fraction of the customer base opts for that service.

The cost issue is understandable – there is significant risk that the returns for the investor do not justify the investment.

From a competitive perspective, cable operators have a less expensive upgrade path, as DOCSIS technology provides a clear upgrade path that could easily enable 1Gbps broadband services. On the other hand, the upgrade path for Telcos is significantly steeper, takes significantly longer and is more cost-prohibitive – often requiring the replacement of copper cables with fiber optics.

This challenge, while daunting, is not insurmountable. But it may require operators to partner with its communities in order to reduce the risk and the cost, while enabling higher revenues through new and different services.

The Applications Challenge

Yes, it is fair to say – at present – the vast majority of broadband users would have a difficult time consuming so much bandwidth and yes, it is fair to say that many ISPs could not meet such heavy capacity demands. But that is today and Cisco’s VNI annually illustrates just how fast bandwidth demand is growing.

According to the most recent VNI (published in May 2012), Global IP traffic has increased eightfold over the past 5 years, and will increase threefold over the next 5 years. Overall, IP traffic is expected to grow at a compound annual growth rate (CAGR) of 29 percent from 2011 to 2016. Based on the growth of streaming video services, it is likely that this forecast is low.

Gigabit networks will bring about a revolutionary change in how people use the internet and will be a catalyst to a host of new devices and applications that can take advantage of these speeds.

Applications such as 3D imaging and printing, haptic devices, health pods (virtual doctor’s office) as well as immersive applications that benefit education and health care will become more common place and cities will actually become smart.

The Google Challenge

Google was on the right path four years ago (April 8, 2009), when it made the following recommendation as part of its reply comments to the FCC Notice of Inquiry “In the Matter of A National Broadband Plan for Our Future”, GN Docket No. 09-51:

“As one example, the Commission should select several U.S. communities as test beds for installing a minimum of 1 Gbps fiber connection to every residential household. By creating these test beds now, the agency can learn valuable lessons about the various technological and market challenges associated with such private sector deployments. These learnings in particular can foster greater understanding about where to place the appropriate dividing line between private sector and public sector support for build-outs of broadband plant. The test beds also can pave the way to establish loftier benchmarks for future fiber build-outs.”

This of course did not happen – but imagine where the world might be if the FCC had put even a small percentage of its stimulus funds towards this recommendation – it might have removed some of the hesitation to invest.

Instead, Google announced its “Think Big with a Gig” program in February 2010, with plans to build and test ultrahigh-speed broadband networks for up to 500,000 customers. Issuing an RFI, Google basically asked cities across the U.S. why they should be a Gigabit city and 1,100 responded.

Kansas City was selected as the first Google Fiber city and Austin, Texas is set to become the next.

One thing that was most interesting about Google’s approach is that they are building to demand. Google divided Kansas City into fiberhoods of 250-1,500 households and set a customer participation goal (anywhere from 5 percent to 25 percent. And to motivate people’s competitive spirit, Google Fiber prioritized its build-out to those with the greatest participation and those that met their pre-registration goals.

Economic Development Key Motivation (and Bragging Rights!)

Many cities understand that bandwidth has significant external benefits for their communities including economic development as well as acting as an essential foundation for health care, education and public safety. It also gives them bragging rights – just take a look at Chattanooga which has rebranded itself the “GigCity”, while Kansas City is now calling itself “Silicon Prairie”.

What is most notable about Chattanooga’s gigabit fiber network was that it was put in place by the municipal electric utility, EPB, to improve power delivery to its customers. Improving city services was the key driver, but realizing the same infrastructure that provides the control network for the utility could also be used to deliver Internet connectivity (once the fiber network was in place) was an added bonus.

Chattanooga is providing a wealth of examples of how the city is utilizing the capabilities afforded by its Gigabit network. Beyond smart grid applications, the city is using its network to monitor and control downtown areas, which have improved safety and reduced crime; as well as the implementation of intelligent sensors for street lighting and traffic signal control. At the end of 2012, the city had built more than 50 apps to use the fiber connections, and more are on the way.

But perhaps most importantly are the economic benefits that these types of networks afford. In the case of Chattanooga, its network has been instrumental in the creation of 6,000 new jobs and generated $400 million.

Taking a Leap of Faith

A handful of operators, communities, utilities and municipalities have taken a leap of faith towards a gigabit future and are already seeing a positive return on that investment. More importantly it is spurring activity in other cities – as more communities understand the benefits to its economy and quality of life.

The path towards 1 Gigabit will not be simple; it will not be fast; and it will not be easy. But it is not impossible. Innovators such as Google and the grassroots efforts of municipalities, communities and universities has the potential to spur investment, so that we may all enjoy the benefits of Gigabit broadband.

And we have already seen an example of this – as AT&T announced its intent to build a 1GB fiber network in Austin, assuming it will be granted the same terms and conditions as Google on issues such as geographic scope of offerings, rights of way, permitting, state licenses and any investment incentives.

Who says miracles can’t happen?!

Still, that got me thinking about the expectations that science-fiction movies and books have, in a way, implanted in us. A lot of people will talk about flying cars when asked what technology they expected as kids would be commonplace in the 21st century. But one of the most recurring tropes of science-fiction movie sets is video communications. Spies (1928) is the earliest I could find, but there are many more: Forbidden Planet (1956), A Space Odyssey (2001), Star Wars (1977), Blade Runner (1982), Total Recall (1990), Men in Black (1997), Minority Report (2002), Avatar (2009), etc.

And, of course, Back to the Future II, in the famous scene where the Marty from the future gets sacked by his boss over video communication (in a strangely prescient scene reminiscent of Up in the Air (which, sadly, wasn’t a science-fiction movie…)

And yet, if we look around us, we’re very far from video communication replacing telephony. Sure, there’s Skype and Google’s Hangout, but use remains very PC-centric and therefore far from ubiquitous. Did you know for example that only 40% of Skype communications were video enabled? Facetime, some will argue, is not PC-Centric. That’s true, but is it used much? Apple doesn’t publish any data about it that I could find (which, knowing Apple, could be an indication that usage isn’t that high, otherwise they’d be clamoring these numbers.) And even if it is heavily used, its spread is limited to camera-enabled iOS devices, which is a niche market in itself (albeit a big and profitable niche).

So while video communication has been conceptualized a long time ago and is technically feasible today, it’s not being widely adopted. Why is that? I think it comes down to three aspects: a business aspect, a practical aspect and a generational aspect.

The most natural players to have brought this to consumers, namely ISPs, have repeatedly failed to do so. Look at this 1993 AT&T advert: it shows various futuristic service concepts that AT&T claimed (at the time) would be marketed by them. Video communication is amongst those: we see a woman saying goodnight to her kid over a public video communication booth. But AT&T didn’t deliver, and neither did the dozens of other telcos who tried to bring video phones into the home. Why? Because they got bogged down with issues around the device for video communication. They tried to impose a dedicated (and expensive) video-comm terminal, which limited the potential market to so few households that the network effect that normally drives adoption of communication services could never take place. Cisco tried to address the same issue with its ümi device, but they made the same mistake and had to discontinue the product. The irony is that the most legitimate device for video communication (mobile phones excluded) is the TV, and in many markets telcos and cablecos still control the TV through their set-top-boxes. Ultimately, the errors of the past were so painful that telcos have become gun-shy. Meanwhile, video communication is slowly moving to other devices and being delivered without the ISPs’ collaboration. That may raise quality of experience issues, but the idea that video communication is ‘not very good but free’ is gaining ground.

Even if the telcos had done it right and been successful though, there may be a practical issue that would slow down massive adoption of video communication anyway: for those who like me are of a generation that predates the internet, our relationship to our own image is still uneasy. The idea that we are being looked at is not something we accept readily. Therefore, while we might be happy to set up a video conference for a family call or to see our kids, we’re a lot more reluctant to let that perceived invasion of privacy take over more mundane calls. It’s actually an interesting conundrum, because I suspect there’s a lot more trust in a good quality video call because of eye contact. Maybe that’s what scares us a bit …

For younger generations who were born in an environment filled with moving pictures nearly 24/7 there doesn’t seem to be such reluctance. A tech friend of mine recently told me how his daughter would set up a Skype call on her iPad to do her homework with one of her friends. The two girls don’t talk much, they just use the video as an emulation for presence. I suspect that this generation will embrace video communication in all its forms.

Which means that there isn’t much time for service providers to stake their ground in that territory if they think it’s worth doing. Otherwise, video communications will be delivered over the top. It’ll be too late then to complain that it’s a data hog!

Examining information from InterWest Partners, there’s clearly one big driver for this spending and that’s Big Data/Analytics. As you may expect, the healthcare industry has enormous hopes for this area and is more than willing to invest. In fact, one of the hot startups of the moment is xG Health Solutions and this is backed by industry stalwart Geisinger Health System.

However, take another look at the chart from InterWest Partners and look beyond Big Data/Analytics. What do you see? There’s a clear disconnect in focus between investors and entrepreneurs. Telehealth and mobile diagnostics are the two areas that appear to excite entrepreneurs. Yet this excitement is more of a murmur for the investment community.

Looking around at the genuine impact these two technologies are already having on patients’ lives, it’s difficult to understand why there should be such hesitation to invest. Yes, Big Data/Analytics will help to drive new efficiencies and power new research initiatives but will it be capable of disrupting the current treatment system?

Let me expand on this a little further.

The continued development and coverage of mobile networks is having a profound effect in the way healthcare is provided. This is especially true in poorer countries. India is perhaps the leading proponent of this. A number of Indian healthcare organisations are now using the rapid spread of national mobile networks to drive new telehealth services. The impact on patient care is proving enormous.

One need only look at the area of peritoneal dialysis to see this in action. Previously, patients would need to travel to hospital for this treatment. For many, this was no small trip, particularly if you live in parts of rural India. However, with the ready availability of new online services, patients are able to administer the dialysis from home while being monitored remotely by hospital physicians.

Compare this with similar dialysis services in the U.S. Here, fewer than 10% of patients are treated remotely. Most are requested to visit a hospital three times a week. One Indian doctor notes that even if the U.S. could move only a small number of its dialysis patients onto a telehealth service it could save millions upon millions of dollars in Medicare and Medicaid.

The whole notion of mobile health is a hot topic and was widely discussed at this year’s Mobile World Congress. A joint report from the GSMA and PwC suggests that telehealth services could cut health care costs in developed countries by over $400 billion. The report explores several key services that are instrumental here, ranging from remote monitoring to digitization and simplified access of health records.

Even though there are significant financial incentives to drive ahead with telehealth and mobile services there are clear challenges. Aside from the lack of investment, we also need to consider the enormous cultural shift. According to research from Pew Internet & American Life Center, fewer than 10% of American mobile phone users have downloaded a health app. One could argue that downloading MyFitnessPal doesn’t quite compare with a life-saving dialysis app, but doesn’t this figure suggest a potential apathy. Are people ready for the additional responsibility that telehealth brings?

What’s clear is that momentum in healthcare IT is building. Yes, entrepreneurs, investors and healthcare organisations may differ on priorities, but what’s incontestable is that we’re gradually moving towards a digital, collaborative and connected healthcare system. A system that is no longer centred around a hospital but around a network. A system that enables us to use our connected devices to drive our own physical wellbeing.

Do you believe that a new era of digital healthcare is upon us? What are the main obstacles that we need to overcome? Have you tried any telemedicine services? If so, how do you rate your experience? Let me know what you think.

Along with this expected rise in population is the continued migration from rural areas to urban areas and the creation of huge population centers referred to as “urban agglomerations”, but perhaps better known as “mega-cities”. According to the same report, 50 percent of the worlds’ population currently lives in urban areas and within 35 years this will grow to 67 percent, putting unprecedented demand on infrastructure, energy consumption and services. As such, innovation in urban design, technologies, and services.cities need to become smarter in order to remain sustainable.

Combine these predictions with the rapid evolution of technology and the need for sustainable energy to meet the rising demand and the necessity for Smart Cities starts to become obvious.

What is a “Smart City”?

Personally, when I think of a smart city – I picture those cities illustrated in Star Wars or other futuristic movies, but that is not realistic – except perhaps in Dubai or other very modern cities. For most of the world, the goal is simply to make our existing cities better and more intelligent.

There is no singular definite for a “Smart City” – although they all share a similar vision where intelligent systems and information (ICT) are implemented to increase efficiency and productivity; reduce the carbon footprint and improve the quality of life for its citizens across multiple facets which include Planning and Management, Human and Infrastructure.

Smart Cities take planning – a lot of it – and the approach will vary depending on each cities stage of development, location, culture, demographics and motivation.

According to research conducted by Alcatel-Lucent – they found three main motivators for smart city projects:

1. An economic motivator reflecting the need to construct or invent a new economic model.
2. An eco-sustainability motivator reflecting the need or desire to reduce energy consumption.
3. A social motivator reflecting the need to improve the quality of life in a city environment.

And although one motivator may be more dominant, aspects of each will play a role in all smart city projects.

Regardless of the motivator, a clear vision and communications of goals along with active participation from key stakeholders is critical for smart city implementation.

The Importance of ICT for Smart City

The evolution to a Smart City is not just about technology – although its role is foundational – as ICT often acts as the central nervous system in helping make a city smarter. ICT powers the delivery of new and better public services, brings efficiency gains and cost reduction and is instrumental to achieving a lower carbon economy. In addition, it can enable a range of socio-economic benefits such as e-health, e-education, e-government, etc.

Although there is not a “one-size-fits-all” approach to the required ICT – there are a number of common elements including implementation of all-IP network core network that can integrate wired and wireless technologies to create a converged infrastructure in support of high-speed Internet services; smart meters, intelligent transport systems as well as monitoring and sensor technologies can help enable advanced services and applications and achieve carbon-neutral footprints. As expected machine-to-machine (M2M) solutions will be instrumental.

M2M is the technology that establishes intelligent communication between things providing online data gathering, remote control and process automation. By using sensors embedded in a wide range of systems serving the public — such as a traffic lights, public transport vehicles or parking spaces — M2M technology can report on the status of the system being monitored via the Internet in real-time  and enable intelligent, real-time decision-making for an array of services.

As such, both service providers and ICT equipment vendors will provide critical expertise in the development of smart cities through their knowledge of building, secure and reliable network infrastructures, and managing and delivering large volumes of data over these protected networks. Key participation will likely include:

• Connectivity/managed connectivity – connecting city infrastructure and individuals to central servers and databases;
• Data aggregation/analysis – combining data from multiple sources to produce new insights;
• Service delivery – delivering real-time information to people and machines that will enable them to adapt and respond to events in the city;
• Customer interface – providing customer support operations, such as call centers and web portals, as well as delivering messages to subscribers.

Mobile Technology is A Fundamental Enabler to Smart Cities

Mobile technology has become a fundamental enabler of smart cities through the continuing evolution of devices, computing, applications and solutions, as were demonstrated at the recent Mobile World Congress in Barcelona.

According to the GSMA – mobile operators are taking an active role in smart city projects.  Out of the 150 smart cities the GSMA tracks globally, more than 100 cities have deployed services (beyond smartphone apps) that make use of mobile networks. The GSMA has identified 232 mobile products and services that fall into four main categories: Transport, Environment/Energy, Municipal Projects, and Economic stimulus and open data, with Europe taking a leading role in its implementation.

Europe Takes the Lead, Reduces the Risk for Communications

In 2012, the European Commission announced its Smart Cities and Communities European Innovation Partnership with the focus of boosting development of smart technologies in cities by pooling research resources from energy, transport and ICT and concentrating them on a small number of demonstration projects which will be implemented in partnership with cities. For 2013 alone, € 365 million in EU funds have been earmarked for the demonstration of solutions in four key areas: Smart buildings and neighborhood projects; Smart supply and demand service projects; Urban mobility projects; and Smart and sustainable digital infrastructures.

Additionally, the EC has established the Smart Cities Stakeholders Platform which provides extensive information such as best practices, toolkits; solution proposals which enable users to find smart city solutions suitable to their city. Key segmentation includes climate, topography, population; density, etc.

Given the wide range of cities within the EU – solutions derived from these projects should have a beneficial impact to the global market.

And while it is unlikely that we will be living in cities like those represented in Star Wars in the near future – we should definitely expect to see continued improvement in how we live, work and play.

“The camera described in this report represents a first attempt demonstrating a photographic system which may, with improvements in technology, substantially impact the way pictures will be taken in the future.”

Talk about an understatement. Fast forward 30 years and Kodak files for Chapter 11, its film business having been blown to smithereens by the digital cameras they themselves had invented.

The difficulty for large corporations to adapt to a technological shift when short term interests prevail has come to be known as The Innovator’s Dilemma, after the title of a book by Harvard professor, Clayton Christensen. There’s an interesting variant of the Innovator’s Dilemma that I’m starting to witness in the broadband business, and that’s what I want to talk about today.

If the Innovator’s Dilemma is a decision paralysis that affects legacy businesses that can’t decide when to start cannibalizing their own lucrative product and service lines with new ones that risk displacing them, then it stands to reason that the competitors of these legacy businesses should be less affected. Newcomers to the market should not be affected at all.

Yet when I, as part of my day job, examine competitive broadband providers around the world, and particularly new entrants, I find precious few examples of disruptive approaches to the market. Could this explain why incumbent operators still dominate their market 20 years after a big wave of liberalization?

The first thing I asked myself is “why this lack of disruptive thinking in competitive and new entrants to the broadband market?” Having examined this in-depth, I think it comes down to essentially two things:

• First, most of the competitive operators’ senior decision makers are people who previously worked for the incumbent. They have, by and large, carried their legacy thinking with them. They view the market as a battlefield, but the rules they understand were set down by the incumbent. So disruptive thinking is as anathema to them as it is to the incumbent’s decision makers: radically tilting the battlefield or shifting the conflict to another battlefield feels to them like destroying the market they know and love.
• Second, most of the disruption that can be achieved in the broadband market involves heavy, long-term investments in infrastructure. When you’re putting that much money in the ground, you are naturally risk-averse and this averseness makes you less likely to embrace disruptive thinking. As a consequence, you tend to compete with the legacy providers on their terms, but you’re unlikely to change the rules of the game.

And yet there are examples of very successful disruptions in the broadband market, disruptions that have reaped great success for those who embraced them. Interestingly, one way or another, all of these disruptive approaches link back to abundance. I’ll come back to that.

• The emblematic example of a disruptive market entry is France’s Free. In 2003, when consumer ADSL broadband was just emerging, a 2Mb/s connection cost 25€ per month. Free smashed the doors of the market open by offering triple-play with 8Mb/s broadband and unlimited national voice for 30€ per month. Over the years, the package grew with additional services and features, but the price stayed flat. It took a while for Free’s competitors to accept that the company wasn’t losing money with each new customer, and the “Internet Troublemaker” as the French press has dubbed, conquered a third of the broadband market and continues to exert a psychological pressure on the ecosystem to this day. Over time, the steam in their wireline engine has exhausted, but they’re now in the process of disrupting the wireless business.
• On the opposite end of the disruptive spectrum lies Norway’s Altibox. Altibox launched its fiber to the home services the same year Free was launching triple-play in France, at a time when the very idea that residential customers would one day need the kind of bandwidth fiber offers was considered silly and absurd in Europe (though not so much in parts of Asia). But they were smart, and they targeted provincial towns where internet and cable service wasn’t very good. They designed a very sleek and rich service offering and went to market with a smart and intimate commercial strategy. In other words, they did what the incumbent could not or would not do. And it worked brilliantly. Altibox is now by our assessment the company that has the best Average Revenue per User and the best take-rate on its FTTH deployment worldwide.
• A final example of successfully going against the grain in broadband is Hong-Kong’s HKBN, also launched in 2003. Every time I talk with the company’s CFO, NiQ Lai, I am amazed again at how a disruptive philosophy can be so deeply engrained in a company’s culture. At the core, what HKBN does is very simple: if – they say – the incumbent wants to avoid at all costs becoming a dumb pipe then surely the best way to compete is to be one. Commoditize the products and services that you offer as fast as possible and you can only win. HKBN now controls a third of the broadband market in Hong-Kong and is the largest FTTH provider there. Their share prices in the last six years have gone up over 800%: they must be doing something right.

The above examples should not in any way suggest that only these players were disruptive (or successful), but they do highlight that radical disruption pays when you’re a new entrant. Of course, these companies took big risks, but they did it to acquire a powerful position in their respective markets. I often despair of broadband projects – especially publicly led – that go through incredible pains, litigation and accelerated learning processes to deploy fiber networks in their territories… only to offer the same services the incumbent is offering, handing said incumbents the tools to retaliate on a platter.

One thing the three examples above have in common is abundance. Legacy operators, incumbents, cable operators or competitive operators all share a worldview: they came to be at a time when the technical resources powering services (especially voice) were rare. They acquired, and still have today a scarcity mindset that pushes them to envisage any use of connectivity by the customer as a “billable event”. This may pad the pockets of OSS/BSS vendors, but it also leaves them wide open to disruption by new entrants who understand that IP enables abundance …

I read an interesting article in the Harvard Business Review recently that suggested manufacturing jobs will continue to diminish as machines become increasingly intelligent and able to communicate on a mass scale. Figures seem to confirm this. Between 1995 and 2002, 22 million manufacturing jobs were lost on a global scale. 16 million of these jobs were in China. What’s amazing is that industrial output during this period soared by 30%.

Some economists believe that unless we start to rapidly innovate and actually race with the machines that we’ll soon see the world economy shrink back to the flat growth rates of those prior to the Industrial Revolution. In other words, an annual growth rate of 0.2%. Only this week at the TED Conference in Long Beach, California, economist, Robert Gordon, stated that we have several significant problems to overcome if we’re to see any growth. These are: an aging population, critical higher education issues, an enormous debt and economic inequality.

The key question is can we drive enough technology innovation to overcome these issues and reverse our declining growth rate?

Enter Erik Brynjolfsson.

Brynjolfsson is the director of the MIT Center for Digital Business and a firm believer in what he refers to as the new machine age. Brynjolfsson suggests that we’re in a transition period. A period where we haven’t yet fully realized the true value of the Industrial Internet. Brynjolfsson is quick to highlight that the same thing happened with the Second Industrial Revolution. It took some time for the old ways to be abandoned before productivity could soar.

Is this where we are now? Is everybody embracing new technologies and new ways of doing things or are people clinging to established and traditional methods?

Brynjolfsson states that the machine age isn’t just about intelligent machines driving mass productivity though, it’s about developing ideas and sharing knowledge. No amount of computing power can ever replace the human brain and by drawing upon new technology and networking capabilities we may be able to advance upon the scientific breakthroughs of 19th and 20th century. What’s key is collaboration and this involves collaboration on a human and a machine level.

It’s this notion of a coming age of heightened connectivity and idea sharing that fascinates me. Yes, there is a genuine concern that the Industrial Internet will impact upon employment, but at the same time there’s the tantalizing prospect of increased innovation. What’s key is that we educate people. Ensure that tomorrow’s generations have the tools to excel in a new era of ideas. We only need to consider the opportunities presented by Big Data and the current scarcity of data scientists to see this point in action.

Do you believe that the machine age is upon? Will the Industrial Internet usher in a new era of productivity? Can we innovate fast enough? Let me know what you think.

Sure, I’ve read a lot about the Internet of Things and even blogged about it, but there was something about this discussion that made me sit up and take note. Perhaps it was the engineers’ enthusiasm or perhaps it was seeing the technology demonstrated but I was hooked. I started to wonder how other companies could apply this technology, not only to foster more social means of communication but to make their technology more interactive. What happens when you bring your manufacturing process online? What happens when you embrace the Industrial Internet?

I was reminded of this discussion last week when reading an MIT Technology Review piece on GE’s newest U.S. factory. Situated in New York, every ounce of this factory has been built to drive forward the Industrial Internet. It has over 10,000 sensors spread across 180,000 square feet that are all connected to a high-speed Ethernet network. Employees at the factory monitor everything that’s taking place on their iPads. Every aspect of the manufacturing process can be analysed and altered without any delay.

GE is still at the early stages of its journey into the Industrial Internet but it’s already showing some strong commitment and innovation. In November 2012, it announced plans to invest $1.5 billion in efforts to connect machine data to its enterprise software (including Chatter) and the wider Internet. GE’s CEO, Jeff Immelt, is clearly excited about the possibilities here and speaks frequently about the topic. Take a look at Immelt’s piece on the rise of intelligent machines.

When you look at the figures you can understand why Immelt is so convinced. If GE can use the Industrial Internet to gain just 1% in fuel efficiency, it would yield $30 billion in savings in aviation, $66 billion in the power generation industry and $63 billion in the healthcare industry. I could continue but you get the idea. We’re talking significant money.

There can be no question that other companies have been using similar ideas for a while. However, where GE differs is in its size and scope. GE’s ambitions are impressive. What’s even more impressive is how it wants to connect this data. It doesn’t want isolated silos. It wants its teams to be able to access and use this information on a global scale. GE is not only talking about the Internet of Things, it’s talking about Big Data too. In effect, it’s talking about a marriage of the two.

As with any marriage, you need someone to officiate. In this situation, there’s only one body capable of doing this and that’s the network. The pertinent question though is whether the network’s ready to fill this role. We’re all aware of the current drive to 4G mobile networks, of the drive to push fiber as far and as wide as possible, but does the infrastructure we have now meet GE’s expectations?

There’s no easy answer to this question. GE works on a global scale and are our global networks capable of meeting these demands? Are our networks ready for the coming era of the Industrial Internet?

Lots of questions on this subject. Let me know what you think. This is going to be a hot topic in 2013.