Cisco Systems has made its network cores the centerpiece of many telecom and cable networks, and the company hopes to expand its presence in the mobile space. Increasingly, operators are seeking to offer customers bundled services that meet as many of their telecom needs as possible-Internet access, television, wireline and wireless phone service-and Cisco views itself as an enabler of the mobility that will allow hand-offs between the varying types of technology.
Jon Hindle, senior director of marketing for Cisco’s service provider segment, said the company views mobility as the ability to keep a person connected to an application that they want to use, regardless of where the person goes or how they want to access it-and he said that view includes handovers from wireline as well as wireless networks.
Cisco’s products, in one form or another, reach about 35% to 40% of the world’s mobile operators, Hindle said, and the company has sold network cores to more than 200 operators.
As carriers seek to avoid becoming mere “dumb pipes,” Hindle said that Cisco’s solutions allow operators to extract value by knowing “who the end user is, what they’re doing, how they’re doing it and what the value of it is”-so that, for example, a carrier can charge different rates for accessing recent sports content vs. older content.
Beyond the service exchange layer, Hindle said, ever-changing applications and carriers’ ability to optimize for them offers new opportunities.
Hindle noted that as new applications become available, they can quickly take up considerable space on a provider’s network.
Hindle added that on wireline or wireless networks today, about 50% to 60% of the traffic is peer-to-peer, and another 20% to 25% is traffic from YouTube.com.
“That one site came out of nowhere two years ago and now accounts for an increasingly recognizable portion of traffic on a service provider’s network,” Hindle said. Such innovation on the application side offers operators the chance to increase revenue by making such sites particularly easy to access, he added.
Cisco uses a partnership approach to deal with the fast pace of innovation in the Internet application space, he said. The company also plans to leverage its connections across different segments that carriers service, Hindle said, from consumers to the enterprise-the principle of mobility and connection is the same, he said, regardless of whether the carrier wants to focus on a business or consumer segment.
Expanded mobile scope
The company is acquiring Navini Networks Inc., which provides mobile WiMAX technology, for $330 million. Although WiMAX’s future in the U.S. is cloudy due to troubles with Sprint Nextel Corp. and its defunct partnership with Clearwire Corp., Hindle said that the opportunity for WiMAX abroad, especially in developing markets, makes sense because there is “such an obvious opportunity” in such markets. Navini has about 75 customers in 60 countries.