Carrier Ethernet to bring relevance back to carriers

Carrier Ethernet provides carriers with reliability and low latency needed to deliver business-grade cloud services, and they should invest in it to boost revenues as core services get commoditized, urge insiders.

SINGAPORE--Carriers should invest in carrier Ethernet to boost the reliability and bandwidth of their systems, which are essential to meet the needs of enterprise customers looking to deploy business-class cloud. But they need to consider their customer profile and needs before investing, stated insiders.

Goh Boon Huat, vice president of business products at Singapore Telecommunications (SingTel), acknowledged that talks of carriers becoming "irrelevant" has been making the rounds as core services such as fixed voice and SMS (short message service) are commoditized. Thus, carriers will need to rethink how they make use of their network assets and find new models to drive value for their customers, he added. The executive was a keynote speaker at the Carrier Ethernet Asia-Pacific conference held here on Thursday.

One way to do so is for carriers to package their full stack of services and network and sell these to their enterprise customers, he suggested. SingTel, for one, has integrated its basic voice and data services, IT services such as managed services, unified communications and cloud computing services "tightly" and have given customers the option of procuring these services as a bundled package or on its own, the vice president noted.

Telecommunication providers will need to deliver these services reliably and with adequate network resources using carrier Ethernet. This is because carrier Ethernet plays an important role in providing mission-critical connectivity and low latency--features that are necessary when providing business-class cloud services, which are as reliable as their on-premise services, to enterprise customers, Goh explained.

The SingTel executive's observations are corroborated by research firm Ovum, which stated that public Internet Protocol (IP) is not adequate to support business-grade cloud services.

"Public IP will not be sufficient for business-grade cloud computing and carrier Ethernet and IP/MPLS VPNs (multiprotocol label switching virtual private networks) will play increasingly important roles," Ovum's principal analyst Matt Walker said in the ZDNet Asia report.

Understand customers' needs
However, Alex Connors, head of international product management at Cable & Wireless, who also spoke at the conference Thursday, called on carriers to know their target audience well before investing in carrier Ethernet.

Using Cable & Wireless' past experiences as example, Connors said it had thought that one carrier Ethernet platform is sufficient to cater to all needs and demands. This proved to be untrue, though, as customers in the financial services industry preferred Ethernet over SDH (synchronous digital hierarchy) for better and more granular control while others prefer the scalability and flexibility offered by Ethernet over IP, he elaborated.