Carriers deploying Ethernet services to enterprises need to think in terms of apps and services, not bandwidth, experts said at a Carrier Ethernet conference Thursday.
Carrier Ethernet services have been on the rise in recent years, but they're typically pitched as fast, cheap broadband connections to enterprises who can't afford ATM or leased lines.
That's a mistake, said Andrew Coward, VP of service provider marketing and partnerships at Juniper Networks, because the real value of Carrier Ethernet isn't speed - it's enabling applications and services.
"When a service provider sells a data service to an enterprise, they ask the CIO if they want 40 Mbps or 60 Mbps or something, and the CIO says "˜I don't know, I just know that my application doesn't work'," Coward said at the Carrier Ethernet World APAC conference in Singapore. "So application performance is becoming more and more critical, but we're selling them bandwidth."
And that's not what service providers want to be selling, he said, when bandwidth revenues aren't growing in proportion to traffic.
"Apps, not bandwidth, is where the money is. If you're not taking advantage of that, you risk becoming a bit player in both senses of the word," he said.
Keao Caindec, chief marketing officer of Reliance Globalcom said that apps support is becoming a major driver for enterprise customers seeking managed data services.
"Legacy WANs are struggling to keep pace with application demand," he said, citing convergence and collaboration, virtualization, real-time transactions and business continuity as key applications driving demand.
Cisco Systems made a similar pitch for a service-centric approach to Carrier Ethernet. Its ASR 9000 edge router, unveiled earlier this week, bundles service delivery functionality and video management into the mix.
"Carriers need to move away from silos of services to a network with service awareness and differentiation," said Monique Morrow, service provider CTO and distinguished consulting engineer APAC at Cisco.
Coward of Juniper also argued that putting apps at the center of the Carrier Ethernet paradigm would require making them network-aware and vice versa.
"Apps need service intelligence. We have to connect them to the business logic of how they behave on the network," he said, adding that the way forward for this strategy was to flatten the network further so that IP-MPLS becomes the transport layer rather than the service layer.
He acknowledges that's easier said than done, not least because it will require a fundamental change in the way service providers think about their networks.
"Usually in telcos the transport and the IP are run by two different departments that have two completely different views of the network," he told telecomasia.net on the sidelines of the event. "The transport guys will have to learn how to deal with IP, and the IP guys will have to realize that they're in the transport division."
Meanwhile, differentiation is also going to be a key factor for Carrier Ethernet vendors as well as service providers - but with the caveat that adding intelligence changes the traditional Ethernet paradigm anyway, said David Emberly telecom equipment research manager at IDC.
"Carrier Ethernet has always promised simplicity and low cost, but delivering intelligence simply makes things more complicated and makes it cost more," he said.
That said, Emberly added, Carrier Ethernet vendors could differentiate themselves via features like multicast optimization and multipoint provisioning with hard QoS enforcement, as well as delivering data mining and targeted advertising.
"The vendors who can break the paradigm of simple and cost effective vs. intelligent and high cost"&brkbar;..will deliver true differentiation and have a competitive advantage," Emberly said.