An Ignoble Experiment

Orlando -- While admitting that "as technologists, we're probably underestimating what the future will bring," Verizon (NYSE: VZ) CTO Tony Melone said the company is set on a path of using four specific platforms--wireless, a global IP backbone, FiOS and data centers--to plot the best course it can for its own future.

Melone (Image source: Verizon)

"Everything we do around the business, we think, will be built round these four platforms," Melone said during a keynote address at GENBAND's Perspectives13 conference in Orlando.

Leading the parade for Melone, and therefore Verizon, is a wireless business which is quickly migrating to widespread 4G LTE and, more importantly, already achieving broadband speeds that are "much greater" than the company's advertised 5-12 Mbps, Melone said.

The IP backbone, he said, gives the carrier "scale and scope" and FiOS is "helping to reinvent entertainment" with a broadband delivery pipe that could, "in the not too distant future," deliver 1 gigabit speeds. Finally, Verizon's increased interest and participation in data centers and cloud infrastructure has become "a very important part of our portfolio," he said.

FiOS is expanding both inside the home and into the business services space, especially as it begins to leverage a PON network that Melone said will soon deliver 40 Gbps bandwidth. These speeds, he said, will flavor what services Verizon--and its partners and customers--deliver to an already-complex home entertainment environment where already "you need your own CIO," he said.

To bring some simplicity to the home, he said Verizon has developed a broadband home router that delivers "sophistication as a gateway" in directing and focusing the services and applications subscribers are using.

It's outside the home, though, where FiOS will soon begin to make its mark, he noted, by "leveraging it for business services and enhancing the value we get out of that invested asset."

That service expansion, he indicated, will come about as Verizon accelerates its copper-to-fiber network migration.

Melone, interestingly, is focused heavily on the strength of his company's wireless business as a broadband provider at a primarily wireline-based conference where GENBAND Chairman David Walsh led off the day's presentations by noting that wireless is "constrained compared to fiber."

Verizon, Melone pointed out, is still heavily invested in its wireless broadband future, and particularly, the "power of the smartphone." That, he said, is leading the carrier to "be more very aggressive with 4G LTE," including finally making use of AWS spectrum it purchased to expand its capabilities and launching a VoLTE (Voice over LTE) service.

"We're building a nationwide (wireless) VoIP network" that will be network-ready this year and roll out next year, he said, declining to add more specific launch times.

Overall, he said, with the addition of the backbone, which networks 150 countries on six continents to carry heavy loads of video, and the data center/cloud emphasis for enterprises, Verizon has built four legs on which it will rest its future.

"We really enable so much of what's possible out there," he said. "We (the telecom industry) need to take that responsibility extremely seriously."

Show Coverage: GENBAND's Perspectives13: Continuing coverage from Orlando

Read more about: Verizon, Perspectives13
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2. CenturyLink launches 1 Gbps fiber pilot in Omaha

By Sean Buckley

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CenturyLink (NYSE: CTL) is providing its own answer to Google Fiber's (Nasdaq: GOOG) last-mile fiber vision by launching a 1 Gbps-capable fiber to the premises (FTTP) pilot deployment that will serve 48,000 homes and businesses in Omaha, Neb. The service will begin rolling out next week.

Offering a new symmetrical connection, CenturyLink said in a press release that it will upgrade its existing fiber architecture with new FTTP technology. However, it did not reveal what vendor it is using for the deployment.

Eligible customers will be able to get a direct connection to its recently upgraded 100G global backbone network, which was built to deal with the deluge of new consumer and business traffic such as Ethernet and video streaming.

Customers utilizing CenturyLink's 1 Gbps service in Omaha will have a direct connection to the company's recently upgraded 100 Gbps global network, designed to accommodate the bandwidth demand driven by cloud computing, mobile traffic, big data and video streaming.

The service provider said that it will begin rolling out the 1 Gbps service next week and expects to have its new FTTP network available to all 48,000 customers by early October.

Having a 1 Gbps service will enhance the telco's competitive footing, especially against local cable operator competitor Cox Communications, which currently offers 50-100 Mbps over its existing DOCSIS 3.0 cable systems. It also will surpass offerings from fellow telcos AT&T (NYSE: T) and Verizon (NYSE: VZ) that offer speeds of up to 6 and 25 Mbps, respectively.

The question that this deployment will prompt is whether CenturyLink will replicate the 1 Gbps service in other markets.

Stopping short of revealing any future plans, it said that would "evaluate its Omaha 1 Gbps offer before determining further deployment of this advanced technology, considering such factors as positive community support, competitive parity in the marketplace and the ability to earn a reasonable return on its investment."

What's interesting about CenturyLink's 1 Gbps plan is that it comes on the heels of Google Fiber's recent move to deliver 1 Gbps service in Provo, Utah, a market the telco entered into when it purchased Qwest in 2011.

Building a FTTP network is a big shift in CenturyLink's last-mile strategy. Similar to its fellow incumbent AT&T, CenturyLink has been dedicated to using a hybrid copper/fiber to the node (FTTN) last mile architecture using a mixture of ADSL2+ and VDSL2. Over the VDSL2-enabled architecture, CenturyLink can deliver up to 40 Mbps in various legacy Qwest and CenturyLink markets.

For more:
- see the release

On the Hot Seat: CenturyLink's Poll: We're ready to put 100G at the edge

Read more about: Broadband, 1 Gbps
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3. GTT buys Inteliquent data business for $54.5 million, enhances Ethernet interconnectivity

By Sean Buckley

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GTT, a virtual network operator, has enhanced its Ethernet and IP transit capabilities by purchasing Inteliquent's global data services business for $54 million, a move that immediately bolsters its Ethernet interconnectivity capabilities.

Besides the purchase price for the company, GTT will also provide $2 million in commercial services over the next three years.

The Inteliquent business has been profitable, generating revenues of $69.5 million in 2012 and serving over 1,100 customers. These customers are served by 120 points of presence in 24 countries, which provide IP Transit and Ethernet services to other service providers.

This sale provides benefits to both companies.

Formerly known as Neutral Tandem, Inteliquent got its start selling voice transit solutions to provide network connectivity to the ILECs for local calls and switched access services, which connect long distance calls. By selling off the data service unit to GTT, one that it acquired from Tinet S.p.A. in 2010, Ed Evans, CEO of Inteliquent said the company will be able to continue "grow our core voice services business."

Over the past year, Inteliquent has been through a number of changes. Last October, Surendra Saboo, the company's president and chief operating officer, one of the chief architects behind the Tinet deal, and CFO Robert M. Junkroski both left the company.

Although no reason was cited for their departures, Clinton Group, Inc.--the investment manager to several partnerships that collectively own more than 1.6 million shares of Inteliquent--wrote in a letter to James P. Hynes, chairman of Inteliquent that the service provider spent too much to acquire Tinet in 2010.

While the Tinet business may have not been a good fit for Inteliquent, it could work well with GTT's business model. GTT has been expanding its Ethernet and cloud-based service sets to cloud network provider to enterprise, government and carrier customers in over 80 countries.

With the Inteliquent data business, GTT will be able to expand its IP transit and Ethernet base further. One of the key Ethernet services it gains is EtherCloud, a Layer 2 wholesale platform that enables its network partners to buy and sell global Ethernet and VPLS connectivity.

Richard D. Calder Jr., president and CEO of GTT, said in the release that "Acquiring the Inteliquent data business accelerates our established growth curve towards becoming a more asset-based network solution provider."

For more:
- see the release

Related articles:
Inteliquent CEO Saboo and CFO Junkroski to step down
Goodbye Neutral Tandem-Tinet, hello Inteliquent
PCCW, Tinet establish joint Ethernet extension partnership
Tinet introduces new cloud-based Ethernet wholesale service
Neutral Tandem wraps up acquisition of Tinet

Read more about: Carrier Ethernet, Inteliquent
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4. GENBAND's Walsh: Countries, cities, hotels could become telecom carriers

By Jim Barthold

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GENBAND Chairman David Walsh can see a day when countries become telecommunications carriers, controlling the networks and leasing them out to service providers. In fact, Walsh's vision, as exposited during a keynote address at the Perspectives13 conference in Orlando, sifts down to cities and even hotels.

Walsh (Image source: GENBAND)

"Think about countries as becoming possibly carriers over time," he said, suggesting that rather than sell spectrum and other infrastructure to service providers to run competitive markets, the governments might keep the infrastructure and build out networks that they lease to the service providers.

The new model would generate revenue for the countries or cities by providing connectivity "really anywhere people gather," he said, suggesting that even hotels "are their own little telecommunications carriers."

The notion of national carriers was only one part of a vision that Walsh revealed for what he described as today's "digital life" where "everything's for sale and it's one big exchange."

Some of the changes, he said, are already happening.

"The whole idea of linear content … that's changing. It's not just how we consume it, it's what's going around that content that's changing," he said.

Other ideas, such as countries and cities as carriers, are a bit further out and less certain to happen.

Determining what will happen and what won't, he said, is the challenge facing GENBAND as it continues to grow and morph with the new telecommunications industry. Two areas where he sees a growing need--and where he intends to focus GENBAND resources--are securing the content flowing around the networks and improving the dynamics of data centers.

Security, he said, is an ongoing concern that is growing worse as "we're constantly being compromised" by growing cyber warfare and purposeful sabotage. "This is bad stuff" and today's apps tend to be "open doors for bad people to walk through."

"If we don't have a way to lock down the network, that's the one thing that can take us down," Walsh predicted.

Data centers, he said, are just wasteful when it comes to resource consumption, including the use of water to cool the 24/7 overheated technology that comprises a center.

"They're power hogs, they're water hogs, they're highly inefficient," he said.

GENBAND, Walsh said, found a way to at least begin to conserve some of the water by using a refrigerated system to cool down the electronics that is "75 times more efficient" than current water-based methods. The refrigeration is delivered by a company, Inertech, in which GENBAND invested in anticipation of a future when carriers need "massive facilities to put all their equipment in" and massive resources to keep those resources running efficiently.

All these factors, Walsh emphasized, are part of the new "digital life" where consumers are not just receiving information broadcasts but "we're interacting" with content via intelligent networks and applications.

Show Coverage: GENBAND's Perspectives13: Continuing coverage from Orlando

5. HickoryTech's Q1 revenue climbs to $48.8 million on strong fiber, data sales

By Sean Buckley

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