Carl Grivner, CEO, Colt Tech­nol­ogy Ser­vices ex­plains to James Pearce the im­por­tance of higher band­width and SDN in Colt’s fu­ture strat­egy

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Carl Grivner, Colt, says SDN and high band­width are im­por­tant

Colt Tech­nol­ogy Ser­vices has gone through a bit of a shift over the last 12 months. Around 40% of its se­nior man­age­ment team has been ap­pointed ei­ther in new roles, or joined the com­pany. This, ac­cord­ing to CEO Carl Grivner, who him­self only took the reins in Jan­uary, has led the com­pany to re­assess its strat­egy.

“In terms of strat­egy, this year has gone rea­son­ably well,” for­mer Pac­net CEO Grivner ex­plained. “We’ve seen some ma­jor changes to our se­nior team – about 40% of the team is new – and there is a big fo­cus on cul­ture right now.

“When you look at what we’ve got to do, we need to hire about 300 sales peo­ple, and cre­ate a cus­tomer-first im­prove­ment in cus­tomer ser­vice that will be ground­break­ing. I’m con­fi­dent we can do that, but the tough thing to change in most busi­nesses is the cul­ture. We’ve still got a lot of work to do in that area. The ques­tion is how we move faster and be­come more proac­tive and re­ac­tive to our cus­tomer’s de­mands and needs.”

Grivner said Colt needs to adapt to the ever-grow­ing de­mands for greater band­width by launch­ing what he la­bels as a “ma­jor net­work up­grade” aimed at turn­ing Colt from a low band­width sup­plier into a higher ca­pac­ity net­work.

Higher band­width mar­ket

The €150m in­vest­ment will see it move from op­er­at­ing in the 100mb and be­low space, which Grivner calls a “com­mod­ity mar­ket”, into the higher band­width mar­ket, of­fer­ing 1GB, 10GB or even 100GB of ca­pac­ity.

“If you look at our cus­tomers and how they are chang­ing, they re­quire higher band­width ser­vices and are mov­ing to more cloud ser­vices,” Grivner adds. “As they make that move­ment – and it will take years to get there – they be­gin to put more ser­vices and soft­ware in the cloud, and this is go­ing to de­mand much higher band­width re­quire­ments than they have at the mo­ment.

“In the past, Colt has been a low band­width sup­plier (100mb and be­low) but we have a lot of as­sets built for high band­width ca­pa­bil­ity. We have a lot of fi­bre in the net­work ca­pa­ble of ter­abytes of ca­pac­ity.”

He says the Lon­don-based car­rier will an­nounce its ven­dor part­ners over the next few months, with most of the ini­tial net­work im­prove­ments com­ing across the metro as well as the long dis­tance net­works.

The in­vest­ment will see the metro net­work seam­lessly up­graded so that cus­tomers can travel from Paris to Lon­don on a 100G cir­cuit seam­lessly with­out any hops along the way. This, in terms of ca­pa­bil­ity, will re­duce la­tency, giv­ing higher ca­pac­ity and the abil­ity to be in­stalled “al­most in­stan­ta­neously”.

Colt will also add more lay­ers of soft­ware de­fined net­works (SDN), an area that Grivner is no stranger to. The Colt CEO has long been an ad­vo­cate of SDN, ad­mit­ting that he “loves” to talk about it.

Grivner first be­gan cham­pi­oning SDN in 2013 dur­ing his time as CEO of Pac­net. Tak­ing charge of the com­pany in 2012, he set about rev­o­lu­tion­is­ing Asia’s largest pri­vately-owned sub­sea ca­ble net­work, cul­mi­nat­ing in the launch of a land­mark

SDN plat­form in Fe­bru­ary 2014. The Pac­net En­abled Net­work (PEN) was one of the ear­li­est and largest ex­am­ples of how SDN can rad­i­cally change the way car­ri­ers can pro­vi­sion and man­age net­work ser­vices.

SDN is the dis­rup­tor

Later that year, Pac­net was sold to Tel­stra for al­most $700m and Grivner went on to join Colt in May 2015, be­fore be­com­ing CEO in Jan­uary.

“SDN is a dis­rup­tor for the mar­ket, it al­lows flex­i­ble band­width on de­mand. But a few years ago no-one re­ally knew the term SDN, and now it has its own con­fer­ences and is a buzz­word across the en­tire in­dus­try.

“I’m a big be­liever in it be­cause I’ve seen what it did for Pac­net (now Tel­stra) and I’ve seen what it is do­ing for us here at Colt. It will rev­o­lu­tionise the tele­coms model for many years to come. What I mean by that is, as more cus­tomers move to­wards cloud ap­pli­ca­tions, the net­work needs to move in that di­rec­tion too.

“We need to cloud­ify the net­work, to make it part of a cloud so­lu­tion. We need to make it so that cus­tomers can buy a cloud ap­pli­ca­tion by the drink, and they can buy the net­work by the drink. That’s a to­tally dif­fer­ent busi­ness model than we’ve ex­pe­ri­enced in the past.”

But he ad­mits that the in­dus­try as a whole is still some way away from fully em­brac­ing the new tech­nol­ogy, even if he be­lieves Euro­pean op­er­a­tors have now caught up with their ri­vals across the At­lantic and in Aus­tralia.

“When you look at some of our cus­tomers and com­peti­tors, Europe has caught up with the US quite sub­stan­tially in terms of SDN. There has been sig­nif­i­cant ad­vance­ment in that area over the last 12 months within Europe.

“We’re work­ing with a num­ber of part­ners on SDN, in­clud­ing a large US car­rier we can’t name. We’ve done some tri­als with them. There are also a few Euro­pean car­ri­ers. We also have com­mer­cial cus­tomers who we’ve been build­ing ap­pli­ca­tions for. Cus­tomers have very spe­cific ideas around ap­pli­ca­tions.”

It is Colt’s abil­ity to re­spond to this, Grivner claims, that has led to the Lon­don-based firm be­ing nom­i­nated for two awards at the up­com­ing Global Car­rier Awards, which will be held in Paris at Ca­pac­ity Europe on 8th Novem­ber.

“The fact that we’re been nom­i­nated for an award for the Novi­tas plat­form is good. With SDN, right now com­pa­nies are po­si­tion­ing them­selves to pre­pare for the long term. Is it some­thing ev­ery com­pany uses right now? No. But in 24 months, I think that’ll be the case.

“The com­ing year should be a growth one for us as we are build­ing up the foun­da­tion and the ca­pa­bil­i­ties of a higher band­width net­work and get­ting the other pieces cor­rect. But it is still two years away, and then SDN will be seen as the great­est thing since sliced bread. Right now, cus­tomers are still play­ing with it. They’re still work­ing out how to use it in their own busi­ness. Be­yond the tech­ni­cal is­sues, there are also ad­min­is­tra­tive ques­tions about who buys the ex­tra ca­pac­ity now that it’s so much eas­ier to do it.”

No data cen­tre dilemma

Another as­pect of Colt’s busi­ness is its data cen­tre arm, which Grivner said re­mains a very im­por­tant as­pect for the com­pany, even if it has been sep­a­rated in terms of man­age­ment. It owns 34 data cen­tres across Europe, man­ag­ing a fur­ther seven in Asia-pa­cific. In Jan­uary, Colt split the data cen­tre arm from its core busi­ness, so that it can run in­de­pen­dently within the Group, with re­sults be­ing re­ported to par­ent com­pany Fi­delity separately.

“We’ve sep­a­rated our data cen­tre busi­ness in­ter­nally, and it is be­ing ran by a sep­a­rate team within the com­pany. We’re just fo­cused on the net­work piece, and re­port in to Fi­delity as a sep­a­rate re­port­ing line. We agree the fo­cus needs to be on the net­work.

“The data cen­tre busi­ness is do­ing well, and we work to­gether, but it acts as a sep­a­rate busi­ness as far as we’re con­cerned. Both arms are do­ing well to at­tract new cus­tomers and new op­por­tu­ni­ties. Fi­delity won’t be look­ing at sell­ing it off.”

This has freed up Grivner and his team to fo­cus on am­bi­tions to im­prove and grow its net­work.

Not only will this in­volve the switch of fo­cus to higher band­width ca­pa­bil­i­ties, it will also see Colt launch­ing new metro net­works – at least two a year ac­cord­ing to the CEO.

Colt al­ready owns net­works in 49 lo­ca­tions, and Grivner said he ex­pects to add two new net­works in the Asia re­gion, al­though fi­nal lo­ca­tions have yet to be con­firmed.

It will then look at sec­ond cities across other Euro­pean lo­ca­tions, as part of

We’re happy with our cur­rent reach, but we want to add a min­i­mum of two net­works per year” Carl Grivner, Colt Tech­nol­ogy Ser­vices

in­vest­ment plans that could top €500m in to­tal over the next five years.

“We’re go­ing to have to con­tin­u­ally in­vest, but I think bud­gets will shift from hard­ware to soft­ware. That means a shift in the type of en­gi­neers we use, as you will need soft­ware en­gi­neers. I don’t think that in­vest­ment can stop, be­cause the ven­dors will con­tinue to make their hard­ware bet­ter, faster, cheaper, but two years from now, some­one will come in with an ad­van­tage over us and then we’ll have to rein­vest.

“IP tran­sit has gone the way of voice in terms of the cost struc­ture; 10-15 years ago it was €50-60 per Mb but now it is less than a € per Mb in some mar­kets, un­less you go to China where it is €100 per Mb. “We’re happy with our cur­rent reach, but we want to add a min­i­mum of two net­works per year. We haven’t fi­nalised the lo­ca­tions yet but our next two will be in Asia and then we will look at sec­ond tier cities in Europe. “We will con­tinue to ex­pand and want to do two or three net­works per year. That will be ad­di­tional to our other in­vest­ments, and we ex­pect to put around €400-€500m in to our net­works over the next three years.”

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