The cloud has brought about various changes -- both good and bad - to telcos. For instance, the cloud has enabled the emergence of many remarkable solutions and technologies. However, it has also caused a massive spike in bandwidth and IP traffic, thus requiring telcos to constantly upgrade their network infrastructure to cope with the rising demand. Jim Fagan, Pacnet's president of managed services, tells us more about the impact of cloud on telcos, how PEN 2.0 counters the negative impacts of cloud, and the technologies he foresees to be the next disruptors to the industry.
How has the advent of cloud impacted telcos like Pacnet? Are these impacts universal or do they differ by region?
The introduction of cloud computing has dramatically impacted telecom and service providers in all markets. The most basic impact has been the explosion of data as cloud and devices now dominate both the consumer and business markets.
Cloud has ushered in a new era of business growth and innovation within the marketplace, compelling providers to develop innovative solutions to support these new offerings. Cloud computing has created a growing need for more resources that can be consumed on-demand. We have seen this evolve quite rapidly on the compute and storage side but it is still in the nascent stage on the network front. We believe the increasing maturation of Software-defined Networking (SDN) allows carriers such as Pacnet the ability to bridge this network gap and offer innovative solutions that will allow cloud users to truly maximize the value of these new services.
For Pacnet specifically, cloud has enabled us to expand our services in order to meet customer demand for cloud adoption and virtualisation. As a result, Pacnet has positioned itself as the leader in the marketplace by completing a number of industry 'firsts': from launching a 100G bandwidth point-to-point Trans-Pacific route, to the introduction of a customer-controlled SDN platform - the Pacnet Enabled Network (PEN) - to becoming the first carrier to deploy Network Functions Virtualization (NFV) solutions in an OpenStack environment with the release of PEN 2.0 earlier this year.
Although telcos are expected to drive business growth through the innovation of cloud-enabling solutions, each is impacted by its geographic service area and the region's challenges to cloud adoption. These can include firewall and data security concerns, integration into internal legacy IT systems, and cost predictability. In APAC however, we have witnessed a dramatic increase in demand for ICT and data centre services from both local conglomerates and multi-national corporations. According to Forrester, APAC cloud computing revenues are predicted to top US$31.9 billion in 2020. For Pacnet, the countries that are seeing the greatest adoption of technologies like PEN are those with mature, high-speed broadband services, including Australia, Singapore, Japan and Hong Kong, as well as the U.S.
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