While cloud-based content and services such as social media are shaping our day-to-day lives, internet content providers (ICPs) have been redefining how the underlying cloud networks are architected and operated. In the past few years, ICPs have become a major driving force behind setting new benchmarks in network efficiency and economics, creating new processes, software tools and protocols for automation and streamlined operations.
This article describes the areas in which ICPs have significantly influenced the telecom industry to create a new approach to planning, building and operating networks for improved end-user experiences. Some, if not all, of these learnings are being leveraged by other players, including service providers, carrier-neutral providers and enterprises.
The proliferation of the internet and the increase in broadband access have fueled the creation of numerous online content providers spanning many industries, such as up-to-the-minute news, streaming movies and music, social media sites and online retailers, to name a few. With hundreds of millions of end users – even billions, for some ICPs – spread all over the globe, ICPs experience a previously unheard-of demand for scalability and traffic growth, and significant revenue streams are directly related to the quality of experience delivered to the end users.
Most ICPs’ revenue streams are from online advertising and monthly or yearly subscriptions for content access, such as movie or music streaming. Because of this, ensuring that end users have access to content is crucial for every ICP’s business model.
As a result, ICPs began to spend heavily on their networks, particularly on data centers and cloud infrastructure, and have become a major driving force for new network economics and unprecedented levels of network agility and flexibility. It is no surprise that ICP capex on network infrastructure have grown substantially faster than those of other communication service providers. According to the recent Optical Customer Markets Report (1H17) from Cignal AI, cloud and colocation providers will have the highest year-over-year growth rate, reaching 24% in 2018.
Challenging the status quo
The rise of ICPs is changing the telecoms landscape with new approaches to building and operating networks. ICPs’ major initiatives for network changes include:
- A new level of efficiency and cost-effectiveness: While networks are key for the successful operations of all ICPs, they represent a cost center where capex and opex) must be constantly kept at low levels. Reducing opex translates into a significant positive impact on ICPs’ top line. Therefore, many ICPs have been vocal to telecoms equipment vendors and the optical networking industry about demanding significantly lower power consumption levels and reduced equipment footprint. Furthermore, ICPs have been major supporters of the use of new optical modulation schemes to unlock the transport of higher capacity over longer distances, hence reducing the cost per transported bit.
- The further use of software in networking and automation: ICPs deal with massive data streams as well as bursty and often unpredictable traffic patterns, both between end users and data centers and between data centers. Moreover, ICPs have developed an unmatched expertise in the creation of software tools and scripts to automate different recurring tasks within data centers. The heavy use of these software tools is now being extended from data centers to the network connecting them, so the transport network can become an integral part of the information technology infrastructure to enhance service turn-up and management and streamline operations. Many ICPs are among the founders of open software frameworks for service creation and orchestration, network configuration and operations, network functions virtualization and many others. ICPs are also a major driving force for the implementation of open application programming interfaces in networking equipment to further simplify service management.
- The establishment of a culture of continuous optimization of network assets: Continuous optimization of network assets is key for ICPs’ ability to decrease costs and increase profitability. The optimization process involves many facets and functions, such as efficient transport of data center traffic, real-time traffic and link optimization, dynamic resource allocation and virtualization and data center optimization, as well as many new green initiatives to reduce power consumption, footprint, carbon dioxide emissions, etc. Some ICPs have opted to create their own private optical networks to further control cost, scalability and network performance metrics such as latency.
- The push for a paradigm shift in operational simplicity: The emergence of ICPs on the telecoms landscape has led to a major shift in how network equipment is built and operated for web-scale environments. ICPs’ core competencies and key skills are around software creation and the use of software tools in content delivery, which is quite different from established telcos that have extensive technical staff and deep expertise in operating optical networks. Therefore, ICPs triggered the creation of a new breed of networking gear, such as purpose-built stackable data center interconnect platforms, and new types of operational procedures centered around easy installation (e.g. minutes from taking the platforms out of the box to having traffic up and running), provisioning (e.g. zero-touch provisioning) and maintenance.
- The drive for open concepts to avoid vendor lock-in: ICPs have been very vocal on eliminating vendor lock-in, advocating open concepts and encouraging seamless interoperability between networking equipment vendors across all layers (photonic, digital, packet). As a matter of fact, many ICPs are founding members of open concept projects and initiatives such as the Open Compute Project (OCP), Telecom Infrastructure Project (TIP) and many others.
All of this shows that ICPs are redefining how networks are architected, operated and evolved by driving toward unprecedented levels of network efficiency, automation and streamlined operations. Many, if not all, of the technologies and procedures that underpin ICPs’ growth can be used to help other network operators increase scalability, lower operating costs, protect mission-critical information and pave the way for smooth evolution to cloud-based applications.