Archive for the ‘Opinion’ Category

$100 Million Value of Shaving Milliseconds

Monday, February 22nd, 2010
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There are lots of different ways to deal with latency and bandwidth contraints, but some of them you might not appreciate.
In 1994, a typical web page was about 50 kilobytes in size and dial-up modems could transfer no more than three kilobytes a second. Under such conditions, Web sites were built to use few pictures, and to start loading in three or four seconds,with full rendering in 20 seconds.
These days, handshaking and other issues account for most of the experienced end user latency.
Round-trip latency for “handshaking” typically runs 700 milliseconds these days. In part, that is because of domain name server translations, even when servers are uncongested.
On the internet, the average latency for corporate websites in America is currently around 350 milliseconds, according to the Network Weather Report operated by the University of California, Los Angeles.
Google’s latency is 150 ms, Facebook’s 285 ms and YouTube’s 515 ms. Such latencies will have to come down considerably if the next generation of internet applications, such as telepresence, high-definition video streaming and remote surgery, are to fulfil their promise.
When shaving a millisecond off the time needed to execute automated trades can increase revenue by $100 million, there is plenty of incentive to build private optical networks with latencies approaching zero.
http://www.economist.com/science-technology/displaystory.cfm?story_id=15523761

There are lots of different ways to deal with latency and bandwidth contraints, but some of them you might not appreciate.

In 1994, a typical web page was about 50 kilobytes in size and dial-up modems could transfer no more than three kilobytes a second. Under such conditions, Web sites were built to use few pictures, and to start loading in three or four seconds,with full rendering in 20 seconds.

These days, handshaking and other issues account for most of the experienced end user latency.

Round-trip latency for “handshaking” typically runs 700 milliseconds these days. In part, that is because of domain name server translations, even when servers are uncongested.

On the internet, the average latency for corporate websites in America is currently around 350 milliseconds, according to the Network Weather Report operated by the University of California, Los Angeles.

Google’s latency is 150 ms, Facebook’s 285 ms and YouTube’s 515 ms. Such latencies will have to come down considerably if the next generation of internet applications, such as telepresence, high-definition video streaming and remote surgery, are to fulfil their promise.

When shaving a millisecond off the time needed to execute automated trades can increase revenue by $100 million, there is plenty of incentive to build private optical networks with latencies approaching zero.

http://www.economist.com/science-technology/displaystory.cfm?story_id=15523761


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Wireless Financing MSO Wireless

Monday, February 8th, 2010
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Cable Multi-Service Operators (MSOs) are in prime position in the bid to bring bandwidth to cell towers. With fiber passing through the most densely populated areas, building laterals to cell sites serving these regions is within ‘easy’ reach, at least as far as deploying fiber goes. With efficient Ethernet backhaul increasingly sited as a key pinch point and business case driver for profitable 3G & 4G (WiMAX / LTE) services, outsourcing backhaul to those able to build the infrastructure is an attractive option even for mobile incumbents with wireline businesses, like at&t and Verizon.

Still, MSOs need to justify the spend and the opportunity cost of delivering fiber to a cell site when opportunities abound in Ethernet business services to enterprises, and quadruple play needs have them planning their own wireless offerings: either with newly acquired spectrum (like Cox), or as a Mobile Virtual Network Operator (MVNO). Good news is that sometimes the stars align, and it looks like the cable operators are starting to realize they can have their cake and eat it too, while talking on their new, subsidized wireless network.

Subsidized? Was there a wireless plan for MSOs buried somewhere in the broadband bailout? No luck. However, becoming a leader in wireless backhaul, business services and adding wireless to the bundle turns out to be self financing – at least for the latter two services. This is because as fiber gets built out deeper into metro regions for backhaul, bringing Carrier Ethernet to businesses gets easier as well. Having an access platform in the neighborhood can also provide service to enterprises, same capital spend.

And the operational expense for MSOs introducing their own wireless drops at the same time: stick an antenna on the tower already serving up bandwidth to mobile operators, and they’ll subsidize cable’s wireless expansion efforts. MVNO the model? MSOs can make a deal with their mobile partner – cheaper backhaul for cheaper pricing models.

It’s a win-win-win situation: build backhaul revenue, position for profitable wireless services, and establish a footprint for high-bandwidth Ethernet to the enterprise at the same time. If it sounds too good to be true, ask an MSO (if they can spare a minute, they’re very busy these days)!


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U.S. Broadband Stimulus to Focus on Middle Mile

Tuesday, January 19th, 2010
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The National Telecommunications & Information Association and the Department of Agriculture’s Rural Utilities Service have announced the second round of bidding, as well as a specialized third round specifically for satellite projects. These rounds will dispense about $4.8 billion in grants and loans  to expand broadband access and adoption.

NTIA’s program allocates $2.6 billion in this funding round of which approximately $2.35 billion will be made available for infrastructure projects. In this round, NTIA is adopting a “comprehensive communities” approach as its top priority in awarding infrastructure grants, focusing on middle mile broadband projects that connect key community anchor institutions – such as libraries, hospitals, community colleges, universities, and public safety institutions.

That is a significant development. NTIA projects, which have been seen as aimed more at metro areas than the Rural Utilities Service program, which exclusively aims to support rural projects, seems to have concluded that actual upgraded access projects are less valuable than middle-mile trunking services.

In other words, much of the spending in both the first and second rounds will go not to any new broadband access facilities, but to intermediate trunking networks that later can be used to provide actual broadband access.

The other interesting change is the new emphasis on a “third round” that specifically will accept satellite projects for the most-isolated locations.

In addition, NTIA plans to award at least $150 million of the funding for Public Computer Center projects, which will expand access to broadband service and enhance broadband capacity at public libraries, community colleges, and other institutions that service the general public.

NTIA also plans to award at least $100 million for Sustainable Broadband Adoption projects, which include projects to provide broadband education, training, and equipment, particularly to vulnerable population groups where broadband technology has traditionally been underutilized.

The separate Rural Utilities Service program will allocate $2.2 billion in this funding round. A second funding window will open later which will provide grants for satellite service for premises that remain unserved after all other Recovery Act broadband funding is awarded.

That round also will award grants for regional economic development projects using broadband, as well as make grants to rural libraries.

RUS will focus its round on last mile projects, which are anticipated to receive the vast majority of funding.

RUS will also fund middle mile projects involving current RUS program participants. RUS has decided to use a 75 percent grant, /25 percent loan model for all projects.

The application window opens Feb. 16 and closes March 15, 2010.

by Gary Kim


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