Facebook Continues To Disrupt The Legacy Telecom Equipment Industry

For some time, Facebook has had its sights set on the legacy telecom hardware industry and has been investing in a raft of projects worldwide to blow it open and double down on expensive and second-rate connectivity.

Last week, we wrote about the social networking giant’s disruptive influence on the data center hardware industry – through its Open Compute Project and open-sourcing its hardware. Facebook is equally interested in disrupting the $500 billion telecom equipment market. By taking an open source approach to its own telecom hardware projects and spearheading initiatives for telecom operators worldwide to do the same, Facebook is spurring innovation in the legacy telecom space, which will ultimately translate to more Facebook users and usage on a global basis.

How Did the Idea Begin?

According to Business Insider, the idea got started one day in mid-2016 when a group of Facebook engineers were sitting together at HQ in Menlo Park, CA and one made a suggestion. “It can’t be so difficult to build our own system”, said the engineer. The idea was to make a faster, yet less expensive version of the hardware that the big incumbents such as Cisco, Ericsson and Huawei were selling.

He put forward building an industry first: a “white box” transponder, made from off-the-shelf components like Lumentum’s optical equipment, Broadcom’s chips and software from one of the network startups.

Facebook’s director of engineering, Hans-Juergen Schmidtke, admitted he was sceptical at first, knowing it would involve hiring teams of specialist engineers and a sizeable R&D budget to do it right. “Building a system 10 years ago was like building a new company,” Schmidtke said. Nonetheless, he agreed to fund a mini group’s efforts to hack together a white-box system for one of the company’s regular hackathons and only three months later, the group had a working prototype.

Enter Voyager

Six months later, that product was announced to the world as Voyager. Shock waves quickly rippled across the legacy telecom industry. A megascale company, whose main business source was online advertising, taking control of its own technical destiny in this way had serious implications for the incumbent telecom equipment companies that now risked seeing their products turned into commodities. “We pulled it off essentially showing that when a few engineers can build a system within six months, the world has changed,” Schmidtke said.

The new transponder platform aptly named Voyager was unveiled in November 2016. Facebook used new open optical packet transport architecture to develop the platform, which it called Open Packet DWDM and was indeed the industry’s first white box transponder and routing solution. It uses combined packet and dense wavelength division multiplexing (DWDM) that enables “a clean separation of software and hardware”.

Facebook was interested not only in developing its own infrastructure, but in challenging the incumbent’s model of using fiber-based technologies for bandwidth and reach. Facebook’s focus on packet-optical technologies that transfer data using light pulses instead of conventional copper wires led directly to Open Packet DWDM.

Voyager was released to the Telecom Infra Project at its launch; similarly to Facebook’s innovations in the data center space, the company also decided to adopt an open approach in relation to its new infrastructure components, hoping in doing so to “enable any interested party to contribute systems, components or software” and thus ‘drive greater efficiencies in DWDM transport”.

The Telecom Infra Project: a Spin-Off of OCP

Voyager represented the first product for Facebook’s then incipient Telecom Infrastructure Project (or TIP) whose stated goal then and now is to create “a new approach to building and deploying telecom network infrastructure”. TIP launched at the Mobile World Congress on February 21, 2016.

In a similar vein to the Open Compute Project (OCP), Facebook launched TIP in order to take control of the technology that supports its platform. Many large Internet companies build their own tech, including Google and Amazon; however, what set Facebook apart is that it was willing to give away the designs for free, inviting anyone at any other company to partner with them and having contract manufacturers ready to sell it all.

Facebook really started to realize that the telecom industry wanted its own version of OCP when it launched Internet.org, Zuckerberg’s initiative to bring the Internet to far-flung locales who lacked the net. Zuckerberg discovered that bringing telecom services to these places, however, was typically too expensive for telecom operators, and in order to do so, Facebook needed to be a part of driving those costs down.

“As we were thinking about Internet.org and helping get more people connected, the idea was, we’re doing this thing called OCP to help the data-center community to build infrastructure that’s more efficient, more cost-effective, that’s greener and more sustainable, more flexible. And we said, can we do that for the telco industry?” Facebook’s vice president of engineering, Jay Parikh, said.

“Facebook, having learned from OCP, comes in and says, we can play maybe a catalyzing function,” Parikh said, describing early meetings he and his crew had at Mobile World Congress. “We’re investing our people and our dollars into technology that is going to solve these problems, and we’re going to contribute that technology, that IP,” or intellectual property, “into the ecosystem so that you all can benefit from this.”

Many of the world’s telecom companies responded enthusiastically. Alex Choi, head of South Korea Telecom’s corporate R&D center, became the first chairman of TIP. “There’s a huge growing traffic demand,” Choi said. “That means we have to install more base stations, find more sites, invest more in the fiber and the backbone and supporting IT infrastructure.” However, telecom companies are not able to charge more to cover the costs as users are pushing them to charge less, not more, for unlimited data plans.

“Operators rely too much on the big telco incumbent vendors,” he said. “We kept pushing the vendors to do more innovations, to do something to bring down their premium price tag. They are making efforts and making progress but not as fast as we want them to be. So what can you do? You explore other opportunities.”

One of the key aspects to the Telecom Infra Project is the drive to disaggregate the traditional network deployment approach in order to spur new innovation and business approaches into the telecom space. There are currently over 500 members – a mixture of carriers, equipment vendors and systems integrators, alongside some of the world’s biggest telecom companies.

Who is Part of TIP?

TIP’s members now span the entire telecom network industry from operators to suppliers to startups, all engaged in the effort to build new technologies and develop innovative approaches to telecom network infrastructure. It is easy to join by signing up to a specific project group and area to work on.

There is also an active Technical Committee – engineers and telecom tech experts who shape TIP’s technical strategy.

Finally, the Board of Directors represents leading figures and companies across the industry. Current chairman is Alex Clauberg from Deutsche Telekom. The other six board members hail from Facebook, Intel, Telefonica, British Telecom, Vodafone and Nokia.

A TIP summit will be held October 16-17, 2018 in London, open to anyone who “want[s] to learn more about the way we work and the technologies we are building”.

TEAC – TIP Ecosystem Acceleration Centers

Back in 2016, Facebook launched its first telecom accelerator in Seoul, South Korea, in partnership with SK Telecom. The goal was to encourage people in the region to launch their own telecom tech startups.

There are now TEACs in Seoul (SK Telecom), the UK (BT), Paris (Orange) and Germany (Deutsche Telekom), each hosted by a different major telecom service provider with the goal of bringing together critical players within the local telecom infrastructure – aimed at encouraging collaboration, accelerating trials and bringing deployable infrastructure solutions to the telecom industry.

In March 2018, TEAC Germany announced the first three startups to join its acceleration program: Airrays, BISDN and Imec’s 60 GHz technology team. The startups gain access to TEAC’s network infrastructure, hardware and testing facilities. They also receive mentorship from engineers at Deutsche Telekom and connections to investors across the TEAC community.

Latest Innovations from the Mobile World Congress 2018

At the Mobile World Congress in February, Facebook announced a slate of updates about the numerous initiatives that it has helped lead.

“The projects are different in terms of what the collaborations might look like,” Facebook’s VP of engineering, Jay Parikh, said today.

They include running millimetre wave-based Terragraph field trials in Hungary in partnership with Deutsche Telekom and in Kuala Lumpur with Telenor, alongside a trial for 60 GHz Terragraph points with Nokia.

Facebook is also occupied with trials of OpenCellular – an open source wireless access platform that Facebook initially announced two years ago – working with Telenor in Pakistan and Vodacom in Africa.

That’s not even to mention the new kinds of business models for rolling out networks they are working on in Peru where local carriers are working in partnership with local businesses and community organizations.

However, Facebook’s Parikh told Tech Crunch in an interview at the time of the announcements that Facebook’s goal is not to monetize these activities over time, but rather to connect the world and help carriers by building on its own data center learnings. Parikh stressed that Facebook had actually taken a “very big step back” since it launched TIP with just four carriers.

“You’ll see that we are one of many people on the board and most of it’s kind of operator-driven and led and there’s now 500 companies in TIP and it’s not just the couple of dozen or so that started two years ago. We’ll continue to play a role where we can — where we can bring our scale expertise, our philosophy around being open and open source software and hardware.”

Cumulus Linux + Voyager

In November 2017, Facebook and Cumulus Networks announced the industry’s first open optical routing platform loaded with Cumulus Linux. As demand for VR and video grows, the need for more bandwidth grows with it. As Cumulus phrased it, “there has become a critical need for better backhaul infrastructure that is cost-effective and scalable and supports high-performing wireless connectivity”. Enter Voyager and Open Packet DWDM and the separation of hardware from software in metro and long-haul fiber optic transport networks. Facebook was looking for a software match for Voyager that offered interfaces for programmability, automation and cost-efficiency, in addition to a top-grade L2/L3 stack and an open Linux model that gives operators visibility.

In a blog post announcing the news, Cumulus described the advantages of the collaboration: “In the marriage of IP and Optical, Cumulus Linux’s routing protocol stack, VLXAN, and EVPN help customers build cost-effective, high-performance long haul systems. Plus, we’ve already worked with Facebook on both the Backpack chassis and the Wedge fixed-form to bring web-scale networking to some of the best open hardware options. We look at this as “an exciting opportunity to bring the Linux networking model to the optics space”.

What’s Next?

Facebook’s mission to disrupt the legacy telecom industry remains undimmed. The vision essentially remains the same as that articulated in a blog post in 2016 by Jay Parikh: “Facebook’s mission is to make the world more open and connected whether developing technology that can help connect the unconnected or creating more immersive experiences that require better connections. With video and VR consumption on the rise, larger, better networks are needed. This is an incredibly large challenge, and in the coming years we’ll all need to work together to understand the specific connectivity challenges in each market and develop new technologies and processes to address those challenges.”

In January 2018, S&P Dow Jones Indices and MSCI said they were renaming their Telecommunication Services Sector and adding Comcast Corp, Netflix, Alphabet and Facebook to the freshly broadened category. The Telecommunication Services Sector would be expanded and renamed Communication Services. It puts the tech companies, including Facebook, alongside traditional telecom players like Verizon and AT&T in a way that recognizes how much their explosive growth has fuelled a stock-market rally. The new categories will be implemented after the close of business on September 28th, 2018.

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