Customers matter; Ethernet exchanges, not so much

17 Mar 2011

Seven things I learned from Day 1 of Carriers World Asia in Hong Kong Wednesday:

  1. Voice is flat but huge (as in "$600 billion in 2015" huge, according to Ovum Europe analyst CW Cheung).
  2. Going all-IP is important.
  3. CSL has an LTE network AND it’s all-IP.
  4. The cloud is very exciting yet overhyped.
  5. Partnerships matter.
  6. So do customers.
  7. Carriers offering Ethernet services aren’t that enthralled with Ethernet exchanges.

The first five points don’t need much elaboration. The last two are worth expanding on a little:

Customers matter

We’ve heard that carriers need to be more focused than ever on what customers want and to give them the best possible experience. Stevan Hoyle, Asia/Africa director for Vodafone Global Enterprise, outlined his company’s customer-focused strategy by describing it as an “obsession” combined with the kind of innovation (via analytics, cloud computing, social networks and M2M) that transforms the relationship from enterprise customer to partner.

Frost & Sullivan’s Jayesh Easwaramony pointed this out already at the close of the session, but it’s worth repeating: if your customer-centric strategy is an “obsession”, you’re probably doing it right.

Ethernet exchanges kinda matter

The topic of Ethernet exchanges came up during the closing panel session, and while the panelists allowed that the concept of an Ethernet exchange was a good one, they personally saw limited value in them.

Cliff Tam, head of the carrier business at Hutchison Global Communications, admitted that HGC had “a big internal debate about this – so big you couldn’t believe it.”

Tam said that while he sees appreciates the potential benefits of Ethernet exchanges, “if we have enough traffic and enough customers going to that end point, I prefer a direct connection.”

Yali Z Liu, director of network planning and engineering for Asia-Pacific, Middle East and Africa at Verizon, said that Verizon participates with Ethernet exchanges “at the wholesale level”, but prefers using its own global Ethernet network coverage to serve its Ethernet service customers.

Pan-Ho Liu, vice president of Chunghwa Telecom’s International Business Group, said the main value he saw in Ethernet exchanges was cost savings and faster provisioning.

Artur Ostrowski, senior VP and head of international services at GTS Central Europe, said that Ethernet exchanges represent just 20% of the business opportunities for Ethernet, as they typically interconnect at the local level.

“It would be more useful for us to be able to interconnect with other regional players, because that could generate a lot more traffic,” he said.

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