Telecom

Computer networking trends 2009 from senior Burton Group analyst at Catalyst conference

The needs of the network are changing in 2009 as enterprises centralize their data centers, rely on fluid storage sources and depend more and more on wireless LANs instead of wired Ethernet. At this year’s Catalyst show in San Diego, I spoke with senior Burton Group analyst David Passmore, to grasp what trends will directly impact enterprise technology and what IT professionals need to prepare for in both the short and long term. Here is what Passmore had to say:

1. As the networking track chair of Burton Group’s Catalyst conference 2009, what major themes will you be addressing this year?

David Passmore: From a networking standpoint, there were four areas we thought would be of most interest for our enterprise IT clients:

• Wireless is one because there’s an increased use of mobile phones for both data as well as for voice. We’re also seeing enterprises using wireless LANs (WLANs) often as a substitute for wired Ethernet.
• The second focus is on wide area networking and what’s happening in the telecom industry, with particular emphasis on what enterprises can do to save money. If you’re a large enterprise, your phone bill, for example, is the second largest recurring expense after salaries. Obviously, if there’s any way for large enterprises to save on their telecom costs, then that’s going to be of interest.
• A third area that we wanted to focus on is unified communications, which essentially is an outgrowth of phone systems — where most large enterprises over the last couple of years have been migrating over to VoIP and IP telephony. Now what they’re doing is trying to figure out how to combine these systems with instant messaging and presence and email, and other forms of communication.
• The fourth area is data center networking: most enterprises have in recent years, consolidated their datacenters: So they’ve gone from a large number of smaller data centers to a small number of larger datacenters. In doing so, now they’re beginning to implement server virtualization. They have these large storage arrays. And essentially, they need a new network that can support the IT requirements in a consolidated datacenter. So we’ll be talking about — for example, how to have your network work well with virtualized servers, and with storage area networks based on Ethernet, and trying to reduce cabling costs — a lot of the issues that affect networks in large enterprise datacenters.

2. How have these themes changed since Catalyst two or three years ago?

Passmore: Each of them has their own specific changes. A big emphasis this year given the economic environment is saving money or cost avoidance. So a lot of the discussion is around initiatives that provide a near-term economic payback.

3. Are the trends this year something we can apply to today, or something to think about for the future?

Passmore: Actually, it’s a combination of both. One of the things we always try to do at Burton is to avoid just telling people what’s worked well in the past. We tell large enterprises what they need to pay attention to or what needs to be on their radar screens as they go forward — such as wireless. The fact that, increasingly, communication is migrating from wired infrastructures to wireless infrastructures, and that includes, not just the use of WLANs within the enterprise, but more use of cellular, data and voice networking.

At some point this might actually make the [networking professional's] jobs easier, because they might find that more and more of their enterprise’s communications is actually flowing over a wireless network operator['s] network. There will be less of a need for enterprises to have to run their own circuits to manage their own networks for connectivity between or within their sites.

Right now, it’s more of a burden because enterprises have to worry about both wired and wireless communications, and people will look at that as doubling their expenses.

In the near term it, it may be doubling the expense, especially because enterprises are interested in how they can get those to work together. For example, [users] have a single phone number that works for both your desk phone and your cell phone; [they] have a single voice-mail box that works for both their desk phone and their cellular phone.

So that’s the near-term goal, but longer term, we expect that a lot of the enterprise equipment will go away in favor of people making use of mobile devices and using the cellular network operator services.

To learn more about these trends, Passmore speaks particularly about how to overcome the challenges storage and server virtualization puts on networking pros, in this Q&A.

Nortel comes crashing down

Farewell old friend

Nortel Networks has filed for Chapter 11 bankruptcy protection. It seems last quarter’s $3.4 billion loss was the last straw. The company still has about $2.4 billion in cash on hand, which it will use to maintain operations while it restructures itself.

When news broke this morning that Nortel was filing for bankruptcy protection, an old and familiar image popped into my head: that of the starship Enterprise near the end of Star Trek III. Badly crippled in a battle with a Klingon vessel, the faithful old ship started her fatal descent toward the planet below. Captain Kirk and his crew safely beamed down to the planet and watched their beloved ship streak through the sky towards its demise.

But as fans know, the Enterprise was rebuilt and rechristened time and again for countless adventures in subsequent films and television shows. So, too, may Nortel.

Right now, the telecom industry has slowed its investment in new hardware. When will that trend reverse? No one knows. No doubt Nortel’s efforts to sell into enterprise networks are also suffering in this climate. And unified communications is still such an emerging market, the company obviously couldn’t hope to stay afloat with the quality products it’s been producing in that field.

Indeed, this is just the first of what promises to be several collapses in the networking industry. When Nortel emerges from bankruptcy, what kind of world will it find? And will it survive? Lots of companies disappear forever in an economy like this, even a company as old and revered as this Canadian giant.

Does the Amazon Kindle violate network neutrality principles?

Imagine signing up for broadband service that forces you to buy your computer from the ISP, only allows you to download DRM’d content from them, and only lets you visit pre-approved blogs – which they charge you a per-blog fee to access.

This pretty much summarizes network neutrality opponents worst fears, but it’s also a pretty accurate description of Amazon’s Kindle eBook appliance, which telecom consultant/blogger Ike Elliott told me might not exist if net neutrality regulation isn’t properly thought out. The device connects using Whispernet, billed as a “wireless delivery system” powered by Sprint’s EVDO wireless data network.

As far as I’ve been able to research, Amazon is acting as a virtual network operator in this case, not much different than Virgin Mobile or any other MVNO. Nobody would argue that these carriers aren’t restricted by the same rules that govern carriers that own their own networks. But even if Sprint is considered the service provider, someone is ultimately restricting ways an Internet connection could be used.

To review, the currently proposed net neutrality legislation seeks:
“to preserve and promote the open and interconnected nature of broadband networks that enable consumers to reach, and service providers to offer, lawful content, applications, and services of their choosing, using their selection of devices, as long as such devices do not harm the network; and
“to safeguard the open marketplace of ideas on the Internet by adopting and enforcing baseline protections to guard against unreasonable discriminatory favoritism for, or degradation of, content by network operators based upon its source, ownership, or destination on the Internet.”.

A quick checklist:

• Does Whispernet let consumer’s use their own device? Nope.
• Reach lawful content of their choice? Nope.
• Use applications of their choosing? Nope.
• Discriminatory favoritism based on source, ownership, and destination on the Internet? Yup.

So why hasn’t there been an outpouring of public outcry against Amazon, a major network neutrality proponent? The simple answer is transparency. Amazon has always been very upfront about what the Kindle is and isn’t for, unlike, for example, Comcast, which has faced a backlash after is going back and forth on whether, and how, they throttle Internet connections. Another aspect might be Amazon’s radical departure here from traditional service models: There’s no monthly fees, no set usage agreements, just a pay-as-you consume model.

Elliott told me that while anti-competitive behavior by service providers is a real concern and must be regulated, he worried that net neutrality legislation which is too vague or too strict could cut out some possibilities for future devices and service plans like the Amazon Kindle. He’s blogged some other thoughts on what he thinks is wrong with the Markey bill.

Meanwhile, I’ve called and e-mailed Amazon for their take on whether or not the Kindle is “net neutral” and how this jibes with their public statements. I’ll post an update when they get back to me.

Update: Amazon responds, saying Kindle doesn’t violate network neutral principles.