Calix is holding its first ever Media and Analyst event this week in San Francisco and CEO Carl Russo, in his opening remarks, offered some advice to telcos who find themselves losing ground in broadband to cable and other competitors.
In response to my question regarding how mid-tier telcos like Frontier and Windstream can reverse their painful broadband losses of late, Russo responded, “They must act tactically to achieve strategic returns.” By that he meant these large telcos, many of whom are Calix customers, can’t possibly upgrade their entire networks at once to build the capability and capacity to compete with DOCSIS 3.1 equipped cable competitors who are inflicting significant pain on them.
Rather they should utilize emerging technologies like Calix’s AXOS platform that allow them to achieve tactical gains quicker. Russo thinks leveraging these emerging technologies will better equip these telcos to ‘pick their spots’ and achieve faster strategic impact than they may have been able to do in the past. They really have no other choice, Russo believes.
“It’s something they’re not used to doing,” said Russo. He is implying that historically, tactical type of moves have limited strategic value. They may have resulted in short-term gains, and maybe from a footprint perspective, local or regional gains. But with the emergence of software defined networking (SDN), or Calix’s take on it, software defined access (SDA), Russo thinks tactical moves can now bring more impactful strategic returns.
Part of Russo’s view comes from the implications of quickly evolving networking technology, where hardware network elements are being replaced by software. That change allows carriers to move more quickly with product development and conceivably, better monetize their network assets.
Calix is very active in this approach and Russo sees it completely transforming the company. Russo says they will introduce more products in 2017 than they have in their entire 17-year history.
“Calix was founded as a wireline access systems company but we’re now a communications software and services company,” he said. It’s a process that began in 2007 and Calix has been purposefully quiet about it until now.
As an example, Calix introduced today the AXOS Subscriber Management Module, which allows carriers to collapse aggregation routers and broadband network gateways in the network, with that functionality replaced with an AXOS software module. Municipal broadband provider Cedar Falls Utilities (CFU) is deploying it on a NG-PON2 platform.
Like many vendors in the broadband ecosystem, Calix is embracing the move to software driven telecom networks. Calix executives here in San Francisco are painting a picture of a company building a broadband network operating system, AXOS, that a broadband service provider can implement regardless of the physical network (copper, coax, fiber, wireless) to better monetize their network. “We don’t care [what access technology the operator chooses]” is a very common statement here.
It’s a complicated process and as Russo admitted, a difficult cultural change, not only for them but for their customers as well.
