Icehotel inspired industry innovations


Open source software is one of the key building blocks of data centers. It is a vital enabler for the transition to open ecosystems as carriers modernize their networks. But many struggle to get their arms around the real value of open source and if its “free” brand is the key to reducing systems cost.


In order to describe the business dynamics around open source-based platforms, I have found analogies with ice hotels supportive. Ice hotels differ from classic hotels in three main ways. The building material, ice, is free. The hotel opens as soon as the reception and the first few rooms are completed, and the ice hotel then evolves while in operation. And the assets have a short life span, which makes life cycle management very different from a classic hotel. It might have been this analogy the governors of OpenStack thought of when they named the ninth release “Icehouse”.

Open source-based platforms build on free components. The full value of the components are realized when they are integrated together into a platform or solution and when support can be provided for the larger entity. Free components do not mean the broader solution is free. The pace in the development of components is very high, with 400 new features in the Kilo release of OpenStack alone. Platform and solution providers strive to develop a stable foundation and a dynamic ecosystem based on these free components. In other words, just because the ice is free doesn’t mean the cost of building and supporting an ice hotel is zero.

Open source and a dynamic ecosystem are tightly coupled to continuous introduction of new capabilities in the system. New features and capabilities are added to systems in operation, and development and operations are closely coupled. For instance, the DevOps methodology blurs the boundaries between development and operations, and new software components can be introduced in networks weekly or monthly instead of yearly. These also create a new conundrum with regards to what should remain industrialized and tested software components and what should be developed as custom-designed parts. Ice hotels are also in continuous development. They open early. New rooms are added throughout the season. Then the platform can become unstable at the end of the season, calling for a major system upgrade.

Life cycle management in an open source world represents a similar balancing act. The platform evolves with the underlying software releases, for example, every 6 months with OpenStack. Features migrate from custom components into the open source base. Solutions leveraging the platform evolve rapidly, and the migration between releases is faster than in a classic network. The high level of continuous integration activities is a vital part of the life cycle management cost and the economic life span for each release is significantly shorter than for classic network deployments.

My predictions for the introduction of open source software in the network are:

  • The primary value of an open source ecosystem is agile feature introduction and broad industry support.
  • The transition to a DevOps model has the potential to create a software platform with 10x shorter cycles between updates, compared to classic IT and network releases.
  • The total capex for an open source platform is driven by the integration efforts and support of “free” software.
  • Finding a good balance between industrialized blocks and customized components determines overall total cost of ownership (TCO).
  • The operational set-up for open source-based platform and ecosystems is very different from what we are used to in classic broadband and mobile networking.

2X @20% @20% 2020

© Peter Linder 2014 – All Rights Reserved
© Peter Linder 2014 – All Rights Reserved

The first 20 years of mobile and internet evolution was characterized by innovating for users, but this ‘smartphonification’ is rapidly approaching saturation in developed markets. However, the current growth wave is different. It is being driven by a mobile and cloud-centric evolution in which the pace of innovation is accelerating with businesses in focus. The question now is: how large can this transformation be?

The first five billion mobile users and their primary devices have been driving a significant market. The emerging mobile-cloud revolution has the potential to unlock even greater business values as enterprises transform to smart enterprises on top of the smartphone wave. So how much value might the next 45 billion devices be expected to generate? My hypothesis is that the new devices on average can generate 1/10th of the monthly revenues generated by a smartphone. Such a scenario mean network revenues could double in a mobile and cloud-centric business world by taking advantage of extended network capabilities to support the new devices?

With the adoption of new network architectures we will see a significant reduction of elements in the networks as we move towards optimized, virtualized and software-defined networks. Considering the fast pace of evolution in computing and storage technologies, it is possible to envision a scenario where a future network can be run with 20 percent of the network elements deployed today. The net result of this is that powerful programmable platforms are coming in, and legacy network elements are being retired.

The massive growth in connected devices, connectivity types and new business models call for a very high degree of automation of network operation procedures. This affects all steps including configuration, provisioning, monitoring and charging and billing. In addition, businesses expect the network to be agile, with the ability to serve their changing needs with on-demand service delivery capabilities. Imagine if it was possible to run the network with a significantly lower staff, say 20 percent of current levels – and require a much different skill set from employees.

A vital industry question is how fast this transformation will go? The smartphone wave and the very fast ramp up that came with it was a surprise to many network operators. Given the very strong momentum among industries in adopting mobile-first strategies for transforming their operations, fast and large-scale adoption for the mobile and cloud-centric wave is also likely to be very strong.

Imagine if already by 2020, the new network and new operational models can be fully deployed by operators. In addition, legacy networks would need to be phased-out gradually and a reality by 2020. Businesses could be fully mobilized and leveraging the mobile and cloud-centric advancements with the network playing a key role in the middle.

Here are my predictions regarding the size of these transformative forces:

* Potential revenue growth is tied to both customization of network services and business model innovation, in order to secure that value is both created and captured.
* The possible reductions in network elements and staff are tightly coupled to the ability to phase out the old in addition to building new. Expect the sunset of legacy networks to be harder than the sunrise of the new.

Frequencies Fuel Fantastic Future

36 Frequencies Fuel Fantastic Future

How can ecosystems respond to soaring mobile data traffic and the risk of exhausting network capacity? Making new spectrum available is an obvious response, but two other elements are rapidly gaining in importance. Frequencies are the fuel for a fantastic mobile future, but it is vital to ensure the spectrum plans and combinations can be realized in large volumes on both the network and the device side to bring the full value to society.

The ecosystem used to be simple, with mobile 2G/3G in well-defined licensed bands and Wi-Fi in an unlicensed 2.4GHz band. With the introduction of 4G, refarming of existing 2G/3G bands and the introduction of Wi-Fi in the 5GHz band, the landscape is changing quickly. The two spectrum types also used different business models and were delivered by different networks.

Devices need to support a growing number of frequencies in order to address the whole global market. Device providers are faced with the task of restricting use to Wi-Fi and nomadic use or to provide integrated Wi-Fi/3G/4G connectivity for full mobility. The 3G and 4G choice involves an HSPA vs CDMA selection for 3G and suitable bands for LTE. The most common bands are 700, 850, 900, 1800, 2100, 1700/2100 and 2600Mhz. Users buying a new tablet or phablet are likely to face a mobile choice that is more complex than they expected.

Networks have adopted advanced multi-standard radio solutions combining 2G/3G/4G for the larger macro sites. These sites have now been modified to support the new target technologies in their new frequency bands. On top of that, the introduction of small cells with Wi-Fi/3G/4G moves the multi-frequency need to the more price-sensitive small cells. The symbiosis of devices and small cells will be extra interesting to track as a vital enabler for the mobile enterprise.

The mobile ecosystem is dependent on the three mobile “natural resources” – spectrum, devices and networks evolving together and supporting a growing number of frequency bands.

Here are my predictions for the future:

  • Advanced multi-radio technology solutions will be the norm in devices designed for daily use
  • New family plans have significantly reduced the barrier of entry for powerful Wi-Fi/3G/4G devices to the point where Wi-Fi-only devices are starting to become limited in their use
  • The addition of new frequency bands and refarming of existing ones requires technology flexibility on both the device and network side
  • Not all frequency bands made available on a global basis will be able to generate market momentum for a full-fledged device and network ecosystem.