The Rise of the Modules
Why is the Telecoms Industry So Interested in HW Modules?
To protect the innocent, hereafter component vendors will be called A, B or O. And I swear that I started writing this blog prior to the announcements in the last weeks…
Sometime in 2001, the author of these lines was invited to a steering committee for a newly founded tradeshow called FiberCom. The organizers, Messe München, were well experienced in organizing successful events all around the world (and in Munich). They had an idea that was pretty obvious to them, but caused a lot of debate among the members of the steering committee… they wanted to organize a tradeshow where equipment vendors and component manufacturers of transport solutions could both participate and show their wares.
Messe München were very surprised about the feedback from a few steering committee members stating that despite the strong linkage between the two parties, the target markets for these two types of vendors (and thus target visitors) of this event were totally different. Thus it was feared that the whole concept might not ‘fly’. In spite of this feedback the event was launched as planned, right after the bubble had burst, but it wasn’t very successful. Maybe because of timing, or maybe because at that time customers of equipment vendors simply had zero interest in component vendors. Boy, has that changed…
In today’s world, it is common to hear questions such as whether a vendor is using the optical modules from A or O? In original or modified version? And whether going for vendor B wouldn’t have been the better option? So either customers have turned into solid physicists, or the perceived value of solutions has moved from the box to the plug, to put it in very un-marketing terms.
The concepts of disaggregation and controllers seem to have driven customers formerly only interested in the ‘value’ of a complete solutions (of course with an eye on their favorite product features) to become “experts” at system level. Perhaps based on the idea that the only remaining differentiator of the hardware is the optical module and the rest ‘can just be programmed via a controller or added via a VNF’.
Facebooks invitation to join them on their “voyage” pushed this mindset even further by listing all the ingredients in alphabetical order, so that you, me and a friend from A, B or O can meet in our garage to create our own solution, which will differentiate by the color of the cabinet. Ok, so that’s a bit of an exaggeration, but it is still a substantial indication of the increasing importance of software to the future of equipment vendors. Because in a commoditized industry, very little merit will be given to branded, ‘aggregated’ solutions.
‘The smaller they will get, the more they will grow’… sounds like a horror movie (and might feel like that for some of us). But this saying underlines the progress the industry has made. Progress which may be the real foundation of this trend. For despite all ‘hype’ and hopes of a paradigm shift, technological complexity is still a key roadblock for game-changing progress in our industry (and all others). Today’s modules house more features in a 5″ x 7″ form factor than anybody could have imagined at the time of FiberCom. This is what naturally led to a shift of value.
But virtualizing a 16TB P-OTS or managing a mesh network takes more than modules. It requires experience to glue many parts together in a way that will ensure that the network won’t become a limiting factor just for the sake of its ‘perceived’ simplicity. So solid technological expertise in building complex networking solutions still has its merits… but progress won’t stand still and the long and winding road towards software driven solutions is the only one to follow.
ECI doesn't sell HW modules, but rather full scale solutions. To learn more, click here.