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Aruba Atmosphere 2021 – “Journey to the Edge”

4/13/2021

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Each year, Aruba, a Hewlett Packard Enterprise company has its Atmosphere conference. This year the conference theme was “Journey to the Edge.” However, this year was also much different from previous conferences because Aruba completed the acquisition of Silver Peak last September.  As a result of the acquisition, the conference had a significant focus on SD-WAN, the primary product of Silver Peak, and integration with Aruba.  A critical new trend that the combined company is now pivoting towards is SASE, which Aruba includes in “Edge to Cloud Security.” Aruba is partnering with well-known companies to deliver a complete “Edge to Cloud Security” portfolio. Aruba’s broadening portfolio allows it to “land and expand” to customers and provide a more comprehensive portfolio. Portfolio growth is what other competitors to Aruba are doing because there’s a growing need to manage networking and security systems simultaneously as users and computing leave the campus environment. Additionally, the company made several new announcements to advance Aruba ESP (Edge Services Platform), like Aruba Central being available on-prem, ClearPass Policy Manager integration with the Aruba EdgeConnect SD-WAN edge platform, and IDS/IPS/UTM capabilities. The company also updated its partners on its growing AIOps capabilities and hinted that it would be making Wi-Fi 6E announcements “soon.”

New announcements
  • Aruba Central On-Premises. Aruba Central for customers that need an on-prem solution. This will complement AirWave, and the two will come together to service network management . Central includes deep analytics, peer comparisons, and AIOps. Aruba Central on-prem is a new introduction that sees acceptance by customers who want to manage the system themselves. For instance, Northwestern University, which uses 7,000 Aruba Access Points, is now using Aruba Central On-Premises. 
  • Edge-to-Cloud Security.  This includes a number of integrations for Aruba ESP. Among them are the integration of ClearPass into EdgeConnect, which brings in the zero trust dynamic segmentation; the integration of Aruba Threat Defense with the EdgeConnect platform; and a new service orchestration capability, so customers can have the freedom to deploy best-of-breed, cloud-delivered SASE security components.
  • Zero Trust Dynamic Segmentation. Aruba’s Zero trust dynamic segmentation capability makes it so users and devices only connect to intended resources.  For instance, Point of Sale systems only talk to transaction processing systems.  By integrating with the Aruba-based product called ClearPass, the company will offer end-to-end zero-trust dynamic segmentation. 
  • Unified Branch Security.  Aruba’s IDS/IPS/UTM capability goes to beta April/May 2021, with General Availability expected by the end of 2021.  Aruba will incorporate IDS/IPS/UT into Aruba Central.

Future announcements. Management hinted at some announcements that will come in the future.  These include:
  • Wi-Fi 6E Access Points.  There were no announcements at the conference, but Keerti Melkote, Founder, President and General Manager of Aruba, said such an announcement will come “soon.”

Updates.  We felt some noteworthy comments came up during the show.
  • AIOps. Aruba has offered AI-enabled systems in Aruba Central for the past year or more, and it is a core attribute of Aruba ESP.  The company explained that it sees three general types of AI happening on its systems and also discussed the improvements that some users see from AIOps use:
    • Reactive AIOps – most common (when a customer has a problem, the system help to resolve it)
    • Proactive AIOps – We’ve seen it improve capacity 100% in specific retail customers, 4x speed increases at some higher-ed customers, and 30x reduction in user issues at some enterprise users
    • Protective AIOps (Security) – 75% report IoT blind spots
  • Aruba Central.  The company shared that it has approximately 80,000 Aruba Central customers as of 4Q20, about 50% greater than the just over 50,000 level in 4Q19.  And Aruba Central now manages 1.3M network devices and over 10M end devices.  
  • Aruba has delivered products to customers “on-time” 99.3% of the time, despite industry-wide supply chain challenges.
  • RAP and VIA. Both the Remote Access Point (RAP) series and the VIA software client have been available in both the Aruba and Silver Peak portfolios for a while; there was some discussion about how these can be used to manage and secure work from home (WFH) environments. We found it interesting that Aruba can turn a home into an office and felt that Aruba could have done more to emphasize this, as the product has been very popular due to the Covid-19 pandemic crisis, so we are bringing it up because work-from-home (WFH) and hybrid work schedules are probably not going away soon. 
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At NVidia GTC Keynote - Jensen UnleashES Years' Worth of Announcements in One Session

4/12/2021

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NVidia Announcements impact every industry, and every company in the world

Today's GTC keynote by Jensen unleashed significant enhancements across the NVidia portfolio. 

NVidia did an excellent job of discussing verticals and giving examples with the company, clearly positioning itself as a leader in the data center space with expertise in ASIC development. 

A clear theme throughout is that AI/ML is moving at a slightly faster pace than Moore's law, and in many cases, applications that used to take days to years can now complete in a fraction of the time.  These advancements will forever change verticals, like transportation and healthcare. 

We are just a few years away from having over 100 trillion parameter models.  The results of such large datasets will change how we construct data centers.  Not only will this milestone usher in technologies like silicon photonics, but we will also see new ways to power and cool these data centers.  Moving data into the data center will drive significant growth in DCI using ZR/ZR+ options.  End-users will not be aware of the cloud's computational power going into every aspect of their lives.

We see innovation in AI and the use of AI in enterprises as still in its infancy, and for markets like data center switching and servers, AI is an additional growth driver over the next few years.  650 Group looks forward to other GTC events this week.

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Huawei Analyst Summit 2021 Keynote Highlights

4/12/2021

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In the keynote session of Huawei Analyst Summit 2021, there was a big focus on chip availability, both in prepared remarks and from questions fielded from the audience.  Huawei Deputy Chairman, Eric Xu, as he has done in past years, answered questions from the audience.  Huawei reiterated that it has enough B2B-focused chips, consistent with comments made one year ago today, which suggests that it stockpiled significant amounts of chips ahead of sanctions.  Huawei expects to remain on US Entity List for a long time. 
  • The company said that a primary reason for the worldwide semiconductor shortages is that other Chinese companies have stockpiled up to 6 months of inventory and US sanctions are the main cause. 
  • When asked a question about ARM v9, it has previously stated that it is allowed to use v9.  Additionally, Huawei plans to work with other Chinese companies to make the chips for the Chinese market, but the question is how advanced the semiconductor process can be.
The company shared many goals.  Those that were communications focused included:
  • Huawei is promoting 5.5G as a means of improving uplink capabilities significantly: From 0.5 Gbps to 100 Gbps uplink by 2030. 
  • The company expects optical transmission speeds of 1 Tb/sec by 2030 (per fiber). 
  • Huawei is advocating for the creation of new IP protocols that are deterministic. 
Other standout topics were:
  • Cloud business unit is big priority for Huawei and it expects to grow software and services as a percentage of total revenues in the future. 
  • Autonomous driving software a big focus.  The company will not make Huawei branded cars, but will take a “Huawei Inside” approach.  It has 3 significant partnerships already and by 4Q21, the Beijing Automobile group will launch a car based on this technology partnership.
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GeoLinks’ acquisition of 28 GHz mmWave spectrum from Verizon

3/30/2021

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​We had the opportunity to speak with an exciting Internet Service Provider (ISP) called GeoLinks today.  Skyler Ditchfield, the CEO, shared his thoughts on the recent spectrum acquisition from Verizon and how it will change the company’s addressable market.  We think what GeoLinks has done with this spectrum acquisition is interesting because this is a medium-sized company buying spectrum from one of the world’s largest operators. The company is planning such a rapid expansion to many important broadband markets.
 
On March 25, 2021, GeoLinks announced that it had acquired approximately 80% of Verizon’s LMDS fixed use 29-31 GHz mmWave spectrum.  This spectrum does not include Verizon’s mmWave spectrum holdings that it uses to service mobile users, so recent iPhone models that communicate with Verizon’s mmWave will continue to work as they always have.  According to GeoLinks, this new spectrum increases its homes passed metric for residential to 90.6 million homes and businesses to 5.9 million businesses.  Markets in which it acquired spectrum include New York, Los Angeles, Chicago, Philadelphia, Dallas-Ft. Worth, Atlanta, Houston, Washington, DC, Boston, Tampa-St. Petersburg, Minneapolis-St. Paul, Detroit, Miami-Ft. Lauderdale, Charlotte, St. Louse, Raleigh-Durham and Indianapolis, among others.
 
With the recent spectrum acquisition, GeoLinks is expanding its footprint from a predominantly California (plus southern Nevada) to a nationwide coverage map. We asked Mr. Ditchfield what the company’s plans are for expanding to the new territories.  We learned that the company is planning a “roll-up” strategy to acquire Wireless ISPs (WISPs) and small local wireline broadband companies. As these acquisitions occur, GeoLinks plans to offer the acquired companies’ customers the new, higher-speed wireless service in the new spectrum. GeoLinks plans new rounds of financing, which may come as soon as a couple of months from now. 
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Cisco Live Event Features Observability, Network-as-a-Service, SASE

3/30/2021

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Cisco's customer event, Cisco Live (virtual), is underway, and the company made many announcements.  We are emphasizing what we think are the most relevant, which include Observability capabilities, Network as a Service (NaaS), and SASE.  Here is a rundown of what we learned about today.
 
Core portfolio (includes Campus Ethernet Switches, Wireless LAN).
  • Observability.  DNA Advantage and Premier customers will now be able to run the ThousandEyes agent natively on their Catalyst 9300/9400 switches and will receive access to ThousandEyes Internet and cloud intelligence at no additional cost.  ThousandEyes Internet and cloud intelligence data is being incorporated into AppDynamics Dash Studio, AppDynamics’ next-gen dashboarding experience..   Cisco executive, Todd Nightingale, elaborated that the Thousand Eyes acquisition has been integrated into the Cisco portfolio very rapidly, and in fact, more rapidly than the Meraki acquisition.   We think that the merging of Observability into Cisco's core products could drive partnerships between Cisco's competitors in networking, security, and Observability.
  • Cisco Plus.  Cisco Plus offering includes Hybrid Cloud and SASE offerings initially.
    • SASE.  Cisco's first Network as a Service (NaaS) focuses on its SASE offering.  Nightingale emphasized that its SASE focus does not mean it is de-emphasizing SD-WAN, but includes SD-WAN, cloud security gateway, and other security functions.  We see that the cloud security gateway (a cloud-based subscription offering) is a significant services capability for Cisco in that it is not a hardware function that Cisco is offering to customers to then resell to others, instead, it is a cloud-based service that Cisco is offering directly to customers.  Cisco views SASE as the combination of networking, security and analytics.  Executives from two different business units introduced SASE: Todd Nightingale (Core Networks) and Jeetu Patel (Security).  Similar to our comments about Observability, we expect that Cisco's SASE offering will drive Cisco's competitors in networking and security into partnerships or other corporate combinations.
    • Hybrid Cloud. The company will also offer private cloud capabilities such as its UCS server, SAN, DC networking (Nexus) and Intersight (orchestrator) as private cloud capabilities; the company has not yet announced names of 3rd partners.   The company's entry to the private cloud as a service market has some similarities to HPE's Greenlake offering. 
  • Intersight.  The company emphasized its digital networking building capabilities by incorporating technology from Hashicorp with its in-house Intersight capability.  We published our views on this Hashicorp / Cisco deal just a few days ago.

Security (includes Firewall, Content Security, Identity). 
  • Password-less.  The company announced its Duo portfolio now includes the unveiling of its Duo password-less authentication; the company says this capability will be available in July 2021 as a "public preview."  The company indicated that it will also bring Duo and Umbrella capabilities "down market" and will also continue to be available to Cisco's traditional large enterprise.  The company announced that it sees 900 million Duo-based authentications per month across its installed base.
Mass Scale portfolio (includes Data Center Switches, Optical Transport, Routing).
  • Silicon One.  The company reiterated that it has 10 Silicon One chips since its initial announcements ranging from 3.2 Tbps to 25.6 Tbps speeds.  The company claims that it has a dozen companies focusing on Routed Optical networks based on the architecture that leverages advancements relating to Silicon One and its just-closed Acacia optical technology.   Executive Jonathan Davidson highlighted the Acacia ZR and ZR+ transponder module capabilities.  Routed Optical networking offers capex, opex, and energy savings.  The company suggests that existing customers who use Routers and optical transport today can take a first step that means plugging transponder modules directly into routers, meaning the need for optical shelves can be eliminated over time.  Cisco featured spokespersons from Microsoft Azure and Lumen (Century Link) to discuss general thoughts on the Routed Optical concept. 
  • Open RAN.  The company has made investments, both disclosed and undisclosed.  The company has engaged third parties' services to integrate and test its orchestration and transport technology with other 5G systems in the marketplace.
  • Subscriber Management.  The company introduced Cisco Cloud Native Broadband Network Gateway, which supports the integration of wireless packet core and wireline subscriber management.
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Chuck Robbins, CEO of Cisco Systems at Cisco Live on March 30, 2021
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650 Group Quick Take: MULTI-Cloud Operating Models Accelerate with NEW deal between HashiCorp and Cisco

3/25/2021

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In the news this week, Cisco has entered an agreement to sell HashiCorp Terraform® Cloud Business alongside its own Cisco Intersight® platform.

Cisco and HashiCorp are helping enterprises accelerate application innovation, including automated management and security, across hybrid clouds. The deal helps enterprises achieve a hybrid cloud operating model using HashiCorp’s “infrastructure as code” for network provisioning and management of private data centers via Intersight.

The Cisco Intersight Service for Terraform will offer a bridge to easily and securely integrate on-premises environments with Terraform Cloud Business, and enable IT Ops and DevOps teams to automate infrastructure provisioning using infrastructure as code across hybrid cloud.

Why this matters?
This arrangement provides flexibility to those organizations running both public cloud and private data center environments. 

Because provisioning can be complex across multiple clouds, customers can benefit from HashiCorp Terraform Cloud as it allows Network Operation teams to provision multi-cloud infrastructure, and manage risks for security, compliance, and operational constraints in a more automated and consistent way, and then extend provisioning into private networks/data centers. 

Additionally, infrastructure security for applications and services across multi-cloud environments and private/distributed data centers remains paramount for enterprises. Specifically addressed security elements in the Cisco + HashiCorp agreement include policy, SSO, and audit logging. Implementing automation tools to keep settings and policies consistent — and easily replicated— goes a long way towards ensuring data is protected to a high standard, wherever it is moving.

Lastly, according to the press release, Cisco will also offer centralized support across customers’ Intersight and HashiCorp Terraform Cloud Business environments under the Cisco Solution Support program.

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SONiC OS continues to be hardened for data center deployments well beyond the hyperscalers

2/24/2021

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SONiC has gained popularity, and development efforts accelerated throughout 2020, despite the lack of travel and face-to-face interactions from COVID-19 restrictions.  2020 saw the incorporation of more features and excitement amongst suppliers and customers.  SONiC now has more advanced features and functionality and continues to be hardened for data center deployments well beyond the hyperscalers.  Advanced functions like BGP and RDMA are supported.  SONiC also added many hours of production traffic under its belt as we estimate over 100,000 switches running SONiC at the end of 2020.

SONiC is a Linux-based open-source networking operating system with its roots in the open community and Microsoft as an original contributor.  Today it has over fifty member companies and thousands of individuals contributing.  It has reached a critical scale beyond Microsoft’s internal use within Azure.  Increased vendor and customer contributions help increase the appeal of SONiC, and our end-user interviews indicate strong interest in several enterprise verticals, more than just the typical financial services sector.
Disaggregation is a trend here to stay with customers evaluating the ASIC, physical switch, optics, and operating system separately.  What was standard with full decoupling at the hyperscalers is making its way down to more traditional cloud and enterprise customers.  True to its open-source Linux roots, SONiC leverages the strength of the community, is beneficial financially to vendors both large and small, and also creates an ecosystem of support and career advancement for individual member contributions.  SONiC’s recent developments time well with a renewed interest in disaggregation.  This is important.  SONiC is being embraced not only at the system level via system vendors but at a Silicon level and in a market of millions of customers, not just a few hyperscalers.  Broad-based support can make SONiC meaningful for the whole networking market.
SONiC deployments increased in complexity as well.  Vendors showcased SONiC working on modular switches, modular routers, as well as the disaggregated chassis. The 2020 releases and future roadmaps continue to add critical enhancements to automation and telemetry.
As we look towards 2021, we see increased adoption of SONiC in Tier 2/3 Cloud providers.  We expect more enterprises to move parts of their network to SONiC.  More contributions from traditional enterprise suppliers and the community will create even more trust in SONiC.  With the disaggregation of switch hardware from the software, we believe SONiC will also see the benefit of accelerated hardware and software development in 2021.  The industry might not observe this directly because of the rapid move from 3.2 Tbps to 12.8 Tbps to 25.6 Tbps switches.  Still, as switch ASICs rapidly hit the market with faster pipes, more programmability, and massive amounts of telemetry data, the industry needs disaggregation and increased development velocity to keep pace.
Beyond 2021, SONiC could play a significant role beyond the data center; edge computing and networks built to support AI/ML seem like good targets, and we are closely watching developments outside the data center as well.



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Extreme Networks Investor Day Highlighted Cloud-Managed and 5G Themes

2/23/2021

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Extreme Networks held its investor day and highlighted multiple themes.  The company highlighted its Networking-focused Cloud-management capabilities, its large addressable market, how the company can benefit from the 5G market and its pivot to growth markets.  CEO Ed Meyercord addressed Cloud, 5G and artificial intelligence themes.  For us, we thought that Extreme's focus on 5G was new and incremental to what the company has talked about in past presentations.  And, of course, Extreme's playing up its market position in Wi-Fi cloud-managed services makes sense because this trend has been growing and Extreme is ranked second.  We see cloud-managed services as a continuing growth trend for the next several years and we highlight these details in our WLAN and Campus switching research programs.
Meyercord explained that as workers, data and computing become increasingly distributed, cloud-managed networking becomes critical.  Meyercord cited 650 Group research confirming that Extreme CloudIQ revenues rank number two in the industry.  The company cited a $26B total addressable market relating to Enterprise Networking and a $3B addressable market associated with the Service Provider market.  The company cited that the 5G market is expected to benefit Extreme Networks, explaining that 80% of the Mobile RAN market will be 5G-related by the year 2025; it cited that 5G-related is a "longer-term growth opportunity".  Extreme sees its next fiscal year will be at least in part driven by: (a) taking share in high-growth networking industry segments, (b) cross-selling and driving cloud-adoption (it cited 5M installed base but only 1.5M cloud installed base), (c) new product introductions such as Universal Platform and Co-Pilot Artificial Intelligence (AI).

Extreme invited Major League Baseball to its investor day.  We were encouraged to hear that MLB sees that 5G and Wi-Fi 6 are complementary, as opposed to competitive.  This debate about two of the main types of wireless has been very active and an important industry player like MLB confirming that it sees the two as complementary validates our own view that Wi-Fi and cellular play together well.


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The SASE Market Is Poised For Growth

2/12/2021

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This week, we published our Secure Access Service Edge (SASE) Forecast and Research report, a deep analysis on the market, the key players, and the opportunity that lies ahead for it. We expect SASE revenue to grow more than 500% by 2025. As a result of strong market growth, we also expect a tremendous opportunity for new vendors to stake their claim in this increasingly complex environment. As the SASE market is at a relatively early stage, many vendors are introducing new products and services to the marketplace, many of which can be considered “best-of-breed” offerings.
 
We think enterprises will be navigating multiple priorities, shifting between the needs of their security teams and their networking teams. As enterprises shift toward Zero Trust and SASE architectures, they are increasingly evaluating and deploying multi-vendor cloud-delivered security services, and it is not currently necessary for all the SASE elements to come from a single vendor. For example, HPE Aruba (Silver Peak) offers freedom of choice through a best-of-breed multi-vendor partner ecosystem. HPE Aruba’s approach is reinforced by the hundreds of deployments they have alongside cloud-delivered security services from partners like ZScaler, Netskope and Check Point. Enterprises working with vendors like HPE Aruba, with a multi-vendor partnering strategy, should be able to continue working with vendors they have worked with already or be able to pick “best-of-breed” systems.
 
The news media has featured our research, and the reports have had interesting takes, for example a Dark Reading article, SASE Surge: Why the Market Is Poised to Grow, focuses on the significant growth opportunities for the market. 
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Rakuten Mobile Reveals Future plans

2/4/2021

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In a briefing with Rakuten Mobile today, we learned two neat things:  It is experimenting with 3GPP on satellite, and it hopes to announced a full-stack Rakuten Communications Platform (RCP) customer as early as next quarter.  The company also shared some plans that it has for improving coverage to 96% by the end of the summer '21, and that it believes it has a 50% total cost of ownership advantage for its 5G infrastructure versus a traditional network operator.

So, what's so important about "3GPP on satellite?"  If satellites are able to communicate with all cell phones and other cellular devices, this would mean that coverage could be enabled where we might need to have placed macro base stations.  If we don't need macro base stations everywhere as satellites provide that coverage in sparse areas, or maybe even along highway routes, then a future cellular operator might be able to build its network with far fewer macro towers and rely more on a "barbell" approach, with small cells providing high throughput in busy areas and satellites providing coverage between busy areas.  This would reduce demand for 5G base stations.  Rakuten expects that its satellite partner, AST, may offer satellite coverage for Japan at the end of 2023 or the beginning of 2024 - that is a ways off.  But, this means that in 3 or so years, the need for base stations may be considerably reduced.

Also, Rakuten spokesperson, Tareq Amin, said he thinks it is possible that Rakuten may announce its first RCP customer as early as next quarter.  We published about RCP in November 2020, around when the team first started making RCP known to the public.  This means that a division of a mobile operator, Rakuten Mobile, may be selling its know-how, technology and services to another telecom operator, presumably outside of Japan.  This is a big deal in that most operators buy from vendors and systems integrators, not from others who are in the same business as them.  It is also a big deal because cloud companies like Amazon, Microsoft and Google all want to sell their cloud services to operators, too.  And, if RCP gets there first, and sells its full stack (radio, core, billing, orchestration, OSS) it would represent a first-ever full stack services deal.  
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