 Hey everybody, this is JSA TV, the newsroom for tech and telecom professionals. I'm Jamie Scott-Octaya of JSA. On behalf of my team here at JSA, welcome to our monthly virtual CEO roundtable. These virtual roundtables lead us up to our on-site CEO roundtables at our C-level networking events in telecom exchange or techs for short. And new for 2019, we are now quarterly. So next one up is Tech's Dallas. That's a pop-up, an afternoon event, March 13th at the Aloft Dallas downtown, where we will be talking bringing 5G to the edge. A great topic there. More info? Go to www.thetelicomexchange.com. So let's go ahead and get started today's topic and traditionally our most viewed roundtable of the year. No pressure panelists. Predictions for 2019 technology and its impact on the ecosystem. We have a fabulous C-level lineup from three absolutely innovative companies joining us today. And here to help us break it all down, I'm proud to introduce my friend, an editor and creator of the industry's top blog, Rob Powell of Telecom Ramblings. Rob, thanks so much for returning every year to be our guest moderator and for kicking off our roundtable series for 2019. I should also add that personally, I love your blogs and I look forward to your own predictions and reports of the industry every December while shipping hot cocoa at the Christmas time. So thank you for joining us as our star guest moderator and please do us the honor of moderating our roundtable. Rob? Thank you, Jamie. And I won't be doing the predictions this time though. We brought some people to do that for us. So let's meet the panelists. Jezebel, tell us about yourself. Good morning. I am Jezebel Gilmour. I am the SVP of Business Development for Packet Fabric, also a co-founder of the company. And Packet Fabric is a fully automated network as a service provider and you say fully automated network that those words don't really go together. But that's what we are. We are three and a half years old. We have 160 on-net locations and where you can order services through our portal or API instantaneously turn up one to multiple hundred gigs of transport service instantaneously. And on top of that, we also do cloud on-ramp connectivity. So we hope you come and see us and talk to us about your knee. Great. Jeff, tell us about yourself and what you're doing. Great. Thanks, Rob. Jeff Lapp, vice president of cloud and managed services here at 365 data centers. 365 data centers is a primarily an edge data center provider. We have 10 markets today and very rapidly growing. All of our data centers are east of the Mississippi currently. But we also have about 28 pops now throughout North America. So North, South, East, West. And as a data center provider, it's very important for us to be able to provide that connected network so that these data centers of course can interoperate. So we provide a full IP transit transport services, high speed redundant links between all of our data centers, as well as a vast array of other carrier services, third party carrier services that we integrate here for our customers to make it seamless as possible for them. Right. And, Michael, tell us about what you're doing. Thanks, Rob. Hi, I'm Michael Quinn. I'm the founding partner of QAdvisors, a Denver and San Francisco based TMT investment banking boutique. We're probably the leading cloud and managed services bank in the world by a number of deals. We've done close to 100 in the last seven or eight years in the cloud and managed services space. Just this morning, our good client, TPX, merged with public company, Pensari. So we're excited to talk about what's coming up in 2019. Right. Now I know how to pronounce Pensari. I wasn't sure. So let's jump right into it. First question. We'll just go right down the line and hear what everybody has to say. What new technologies do you see driving the industry in 2019? Where is demand for internet infrastructure and services, whether perceived or real, going to come from? Jezebel? Well, so given that packet fabric is a fully automated network, we see demands and new technologies driving the internet infrastructure coming from the growing needs in storage, in compute. The growing amount of data needs to be moved around between these storage clusters is a high demand for all of those people, for all of the customers, because what's happening is not only they have replication that's needed between their own data centers, but they're moving information to the cloud. So there's technology that's driving the movement of data from the data center to the cloud and back. So the end user have to be able to access the data that's been put into those locations. So we see that the need for security, all of those easier management of security on the movement of data, the requirement for scalability and better transport service because of the storage demand. And a lot of that information is really all feeding into the new AI and ML, that artificial intelligence and machine learning. The machine learning is doing all these algorithms based on the real time data that's being collected, that's been moved around. So all of that coming together with security is really important. But to us, what we see most is the requirement for the data by passing the transport of data by passing the internet. Jeff, what do you see coming? Yeah, I absolutely agree. I've said this many times over the years and this will continue to be the case. If you want to know where everything's going, follow the data. We have just an absolutely outrageous explosion of data. It's not even exponential and more geometric level explosion of data. Two and a half billion gigabytes of data every single day, new data, not the existing data lands on the open internet every single day across the world. And of course, that's increasing tomorrow, it'll be 2.6, the next day after that 2.7. And this causes some serious problems. We're not just talking about scaling problem in a traditional sense. Everything that Jezebel just mentioned, right, the ability to transport the data, to store the data. And most importantly, which I think is going to be the largest tension in the industry has given to technologies around securing that data. Because as that data continues to grow, the rate that it is, it is going to become monumentally more difficult to protect it. And as networks get larger, the size of these attacks that come at your data are going to increase very significantly. So there's going to be a lot of focus around that. The other side of the coin is going to be the things that we're seeing that later this year with 5G, the availability of that, that's going to bring not only a much larger highway, to bring all that literal on-prem data backhauled to the edge and then of course further backhauled to the public cloud. But now you've got the availability of that many more devices that are out there generating that data, the IoT of the world, right? There's going to be another massive explosion of data now coming from that side of the house. So we've got, we've got some pretty significant challenges, I would say, I don't usually make investment recommendations. I'll leave that to Michael. But I would say that if you're investing or if you're in the business of data management and data storage, you're probably going to be in business for quite a while. Interesting. Michael, you've been called out. Yeah, no, look, I think both Jeff and Jezbel make some good points. Obviously, as a banker, I look at it a little differently. And for me and for our clients and for the investors that invest both on the infrastructure side and the cloud and managed service side is network capacity is growing. And the need for better, faster, more secure network capacity is growing daily. The question is how do you do it in a cost effective manner, right? Because in the old days, and Rob and I grew up in the CELAC world know what people always hated was the lack of free cash flow. And now you have the ability to accelerate network expansion through SD-WAN, fixed wireless, small cell, which increases the pipe. And you're going to need that, as Jeff mentioned with 5G, but how do you do it in a cost effective manner? How do you meet the client's needs, but not cripple yourself financially by spending too much on an infrastructure? And I think the technologies that enable that are going to be the winners. Great. For each of you, in what part of the ecosystem do you expect to see investments focused? Are we looking at things on the edge in the software or the gear? Jezebel? Well, I run a network. So I like to think that the investment is going to be put into the network. But our network is different than almost everyone else's network because we are a truly software driven network, right? So everything you interface with the network as a customer is through our own software. So in essence, if you're investing in the network, you're investing the software itself. From my perspective, 2018 was a year of investment in SD-WAN, right? As Michael said, that there's a lot of development in SD-WAN, but also SD-WAN has certain limitations. It's an over the top product. So it writes over the internet. When we talk about the need for scalability, when you write over the internet, the inherent problems is still there. You do not expand the capacity. You're not writing on larger pipes. You're only making it more optimized. So you gain a little more benefit from it instead of the true scalability of a private network. So what I like to see from the investment community is investment in SDN, a true SDN, and to scale out and grow on top of the SDN layer because in order to change people's behavior, it requires not only a great product, but convenience to use and competitive pricing. The question on why should you change to a new technology shouldn't be because X, Y, and Z, it should be why not? Jeff? Yeah, you know, at the end of the day, the way that I've always viewed the progression of technology is if you look at the entire chain that's required to deal with data, whether you're talking about processors, which typically will generate the data storage that contains the networks that move it, as that continues to evolve, it's being pushed by the data. So as you apply pressure to one particular area of that chain, the next one in line will feel the pressure that will have to adapt and adjust and so on. And that's the level of scaling that we're seeing. In fact, right now, to Jeff's point, we're seeing a shift. I rebalancing of the equation, as I call it, across the global internet from the public cloud to the edge and now, of course, the on-prem and the balance of where that data lives. Because as we continue to scale and we continue to push those resources harder and harder, each of those respective areas you're going to have to adjust to accommodate, right? There's always going to be the weakest link in the chain. So no question on the network side. We're about, I would say about halfway through our overall of our backbone network on our journey to 100 gig and beyond, and we're obviously partnering with companies around the world to help us extend that network, extend that reach. Because of that shift that's occurring, we've got to be able to support that shift. And that is absolutely happening right now, as we speak. And of course, the data center space, obviously, the brick and mortar space that we're in, not only just expanding square footage to be able to contain these technologies, but also, like Jezebel was mentioning, right? We need the efficiency. We need the software to do what it needs to do to help us contain this, so that we don't have to deploy so many resources, or as many resources like become more efficient. Same thing with the increase in the density of these systems, right? The server and storage world, they're bringing much more power, but they're bringing it in a much smaller package. But one thing that we have to deal with as a service provider is that there's no free lunch. So as these technologies become more powerful, they also draw very specifically in the data center more power, more wattage per square foot. And that's a real problem for us, right? I mean, even though we've got the floor space, we have to make sure that our power systems that support all that are also in line with that efficiency in that shift. So that's the stuff that we've got laid out for 2019, as far as the investments that we're making in that we're seeing in the industry. Michael, what part of the ecosystem do you expect to see people focusing on? Well, so I look at it from two angles, I really agree with with what what Jezebel said. So clients, enterprise, medium sized clients care about two things, security, reliability, and customer experience. And so I am very wary of the constant growth in over the top service providers, because you I don't think you get the customer experience. I don't think that you get the security elements that you do within it. And so I'm in full agreement with Jezebel. I think SD-WAN is really just that first step to that application layer. It's more secure. You're just going to see a lot of consolidation in that area. We just did a capital raise for Merriplex in Houston, which is a SD-WAN provider. TPX is probably the largest SD-WAN provider right now. You know, we just did that transaction. And the reason why is the application layer provides feature and functionality that you cannot get from a traditional network. But, you know, the question is what kind of security elements do you need? And you're seeing a lot of SD-WAN companies that, first and foremost, they're leading with the security element of their SD-WAN offering, as opposed to anything else from an application layer. On the infrastructure side, I think what you're going to end up seeing is a lot of what we at Q call tower as a service, where you're going to see a lot more development work like we did with the Tillman infrastructure deal between vendors and tower operators, offering their clients a full package of hardware, software and bandwidth. And that's something those have all been siloed traditionally. And right now they're becoming a service MRR offering to carriers. And that is very, very new. Interesting. On that note, on tower's note, is 2019 the year that we're going to see 5G for real? Or are we still prepping the infrastructure as we have seemed to have been doing for a while? How will the expected 5G rollout activities affect the ecosystem going forward? Jezebel? Well, you know, I can't tell you how many times I hear about 5G and the edge in 2018. And I continue to see those words blasting my screen from every channel. But from what I know of 5G, which may not to be as comprehensive, the technology is still somewhat further out. And in the investment of the deployment of 5G, which is extensive and very expensive. So I also spoke to some of the application and content providers in, you know, they they keep hearing about 5G and they're planning their strategy about, you know, on 5G, but they don't have them all in place yet. So as I understand it, we are absolutely are going to still be in the infrastructure preparation stage for 5G rollout, as you say. And we also have spoken to a few different companies that are you know, going to be very heavily influenced by the deployment of 5G. And they're trying out a slew of different solutions to support 5G. Nobody knows the answer just yet, I guess is what I'm trying to say. And we're all trying to figure out how to make it work better for the consumer at the end. Interesting. Jeff? Yeah, you know, we're not a we're not a mobile network operator. Certainly not something that's off the table in the future, but it is very early. And one of the things that seems to be coupled with the 5G discussion is also the concept of smart edge computing or just edge computing in general. Obviously, that's, you know, kind of again, trying to improve that user experience, but also having the ability against the backhaul to the edge or further that data that is somewhere. But really, it's all around the user experience, right? This is why we're even talking about this or at least considering it. And 5G, of course, is the is the means by which that data will will will traverse, you know, backwarding forward across that those two, you know, those two areas. But it's really around again, the application deliberate increasing user experience. In fact, one, one vendor that we spoke with recently said, give us a very interesting use case might sound a little bit big brother share, but I think you'll get my point. You walk into a retail store, which has of course, these technologies, the smart edge based technology. And within a few seconds of walking into the store based on maybe perhaps, you know, whether you're a man or a woman or depending on how tall you are, or what kind of clothing you're wearing, what kind of shoes you're wearing, the system can determine which area the store might be more, you know, something that you're interested, you know, whether it's shoes, purses, sweaters, whatever. And the the ability to do that has to bring the real time process and right to the on-prem, right? But in order to do that, effectively, long term, you have to have those technologies like 5G again, bringing that back to the data center for further analysis and crunching and then and then speeding the on-prem systems with that with that that new analysis. So there's going to be essentially new state applications going into 2019 and certainly beyond. Michael. That's interesting. I think we talk about 5G as this ubiquitous concept, but you really have to look country by country. Okay. And what's going to slow down 5G politics? Take Europe right now. And we're not even talking Brexit. We're talking about Huawei. Okay. So the governments want to ban Huawei from the 5G networks. This week, both Deutsche Telecom and British Telecom said if you do that, 5G rollout will be delayed 24 to 36 months. Okay. Now, the governments have a choice to make, right? Is the privacy and national security more important or is getting faster data speeds in Canada and in the US, the ZTE and Huawei have already been kicked out of most of the networks. So that's going to be an issue. So what I look at is we're going to be at four and a half G for a long time. And the results is going to be a faster deployment of small cell, a fixed wireless, allowing more of the backhaul that Jeff and Jezbel was just talking about. And I think that 5G is going to actually slow down the cost of the political situation that we're seeing. Interesting. And that ties into the next question on security. Is it going to be Huawei all the time at this point? What do you see as driving the conversation and security? Are we no longer looking at the loan hackers and the criminal enterprises but the nation state? Or what do you see, Jezbel? I think security is becoming much more front center, not just for the experts of the industry, the people who are in it all day long, but the consumers. The privacy, the security at the end of the day, the definition of security I went up incredibly, because your privacy is also security. So how do you define that? And it requires, from my perspective, again, it requires everyone to work together. Yes, there still could be a loan hacker. There could be nation states that we need to be on the defense for. But as an industry, we need to come together from all the different layers of technology to make security a truly solution that's built in as a mentality, rather than an afterthought. Security can't come after you build a solution and say, Oh, we forgot to add in security. Let's see if we can buy a piece of software to add some security to the solution that we've implemented. It doesn't happen that way. It has to happen from the very beginning. You have to build security as a mindset from layer zero all the way up. Yeah. Yeah, I mean, I couldn't agree more. I mean, security, I think by some people, when you ask them what the definition of that is, it's almost as clear as what cloud was initially, right? A lot of people really couldn't define it because it was a lot of different things. And security absolutely is one of those multifaceted areas, defense and depth, securing of the data, securing of access, log analysis, incident response, micro segmentation, all these things. But also, it does include an area that we don't hear too too much about every once in a while in the industry. But as a service provider, we certainly see it. And that's also about the availability of the data. Because whether you're if your network is down for one reason or another, obviously, your customers are up that way. We work to avoid that. But the network may be just fine. But it may be that we're being attacked, right? Distributed DDoS and those sorts of things. So that's the other avenue of the security component, right, that we have to we have to look at. But it's very interesting. I had a conversation with a good friend of mine who manages six of the 10 largest banking institutions in Manhattan. And one of the things that they're very keen on or that they're driving to, because there's just simply no option is the ability to use AI machine learning type technology to try to keep up with the the attack pace. There's a lot more people out there that are trying to attack because now you've got much larger bandwidth, right? I'm sitting on, you know, my home office right now and I've got a one gigabit per second connection directly into my office from our local provider. As that becomes more prevalent, again, the attack surface is going to be much, much larger. And so we're going to have to really deal with the threat of the network and what's carrying that data and those attacks. And the other thing is, is that we need to simply be able to keep pace with it and be able to support through, in some cases, the millions and millions and millions of log events that happen in a day, that's no one single person or even a group of people can do it, right? We're going to be machines in order to keep up with that. And it's going to be going to be pretty interesting in security space, no doubt, but it's an evolution. It's not a once you've got it in place, you're done. That has to be looked at over the course of three, six and 12 months and looking at where you stand in light of the new threats that are coming down the road. Okay. Michael, what do you think security is going this year? You know, it's interesting. I look at it from a personal level, right, where I think my wife wants to throw the Alexa in the garbage can because it just starts talking to us, you know, and there's no one named Alexa in our family. So you have you have that element to it. And then I think you have the regulated industry and the, you know, we're a registered broker dealer, right? We could never go over the top, right? We could never use an over the top solution because the, the, it just doesn't meet the criteria for a secure network. And I think if you look at financial services, as Jeff mentioned, if you look at health care with HIPAA, you look at any type of regulated industry or any defense industry, the security element is huge. And it's really just it's not simply from nation state hackers. It's from corporate, corporate hacking, you know, industrial espionage. And these are really not spy fiction things, right? These aren't Robert Ludlam type novels. Okay. This is real stuff that's happening all the time. And so if I'm, if I'm a public company, and I have no network, right, that ring central or an eight by eight, I personally believe that there is a cap on where those businesses can go because they just don't have the security element to it. And I think that's going to be, you're going to see that change a lot in the next 18 months. Interesting. All right. Let's, let's move on to prediction, Simon. Can, can each of you give me one concrete prediction of something you expect to happen in the world of internet infrastructure in 2019? Don't be shy. I have to do it every year. So Well, you're putting me on the spot. I think that enterprises and because this is my, this is our customer base is so I'm going to speak from their perspective. I think enterprises are going to be looking for secure dedicated connectivity for their solutions, because as we see things, everything that we've gotten to today, the prevalence of cloud offerings, of service offerings, video conferencing, right, we're using today are all being conducted over the internet. We're going to see a lot of that that's going to go on private networks that's dedicated for those services between the service provider and the customer prem and the customer's dedicated network nodes. So, and that's for better security, which we just talked about the better performance reliability. And that's what the customers are looking for, because as Jeff said, you know, DDoS is isn't just a single case that happens to the biggest network once a while anymore. That's a constant in life. And all of those now, even the smallest enterprises have to be wary about. So as Michael said, the customers are looking for reliability, performance, and most of all security in 2019. Thank you, Jeff. What do you got for us? Yeah, there's so many, so many things we could talk about. But I guess one in particular, again, just trying to keep it near and dear to my heart in the cloud space is, as we continue to move forward, and we're, you know, this shift that we're seeing right now, which is a pretty significant one, I think Michael Dell was quoted saying that he's calling it the repatriation of the on-prem, right? There's a lot of applications that are being pulled back for various reasons, back to the edge or the on-prem closer to home, right? It might be latency related, right? That's a physics problem, like the cost containment. It's obviously the public clouds are not going anywhere, but there is a there is a change happening. We're seeing that in terms of, you know, AWS outposts and, you know, Azure stack things and trying to, trying to maintain and keep that revenue with those vendors, because they're certainly seeing that that shift occur as well. And 40% of the calls come on every week. I hear that, right? At least in part, there's a lot of data and applications being pulled back. However, what I think is still going to be very necessary, which is what I see a lot of vendors that we work with, what they're trying to do is they're trying to abstract away the all of the moving part, if you will, all the complexity around the integration of and working with the integration between your on-prem solution or your data-centered solution that's close to home, as well as, you know, the public cloud, right? So you have your private cloud, your public cloud, and how do they interoperate? I think that we're seeing software being really the main focus in enabling that to occur. And what I get the vendors are really trying to push for now is, again, they want to make it as seamless as possible to be able to move workloads backwards and forwards, regardless of the type of public cloud that you're using. And there's many of them out there. But also the full integration with your on-prem private cloud. So as your application set evolves, as your requirements evolve, certain data sets move very freely back and forth. The applications, of course, go with that. And the abstraction layer that we're talking about, again, is all done in software. So I think you're going to start to see that the lines are going to be blurred. And it's as they say in real estate, it's going to be all about location, location, location, as opposed to necessarily Azure, Amazon, Alibaba, Google, it's just going to be where in the world is it? Because the complexities have been, have been abstracted away now by software. So it'll be interesting to see where that goes. Interesting. Cool. Next. Okay, well, I think the first thing we're going to see this year is that cloud data providers, the Azure, the Google, the AWSes of the world are going to buy cloud voice companies or contact center companies. I believe that the, the merging between that and the application layer are huge. And those folks have unlimited capital. They have a client base that actually trusts them. And for that, the ability for them to sell to the mid to large enterprises are huge. So I would expect in 2019 to see one, if not more of those guys make a very large move similar to Cisco's move to buy broad soft last year. That's prediction number one. Prediction number two is we're going to see a renaissance in traditional OEM manufacturers, the Ericsons, the Nokia's, the Appletales of the world, and they are going to fill that void caused by the political upheaval that's the Chinese manufacturers find themselves. And my third prediction is that my beloved New York Knicks are going to be known as the Venezuela of the NBA, because after their trade, I think that Madison Square Garden will become a wasteland. It isn't already. Fair enough. Fair enough. All right. Well, thank you, all of you. I'll turn it back over to Jamie here. Jamie. Oh, my goodness. Thank you guys for your fabulous 2019 predictions. I can see us doing little vignettes over the year when one of Michael's predictions hit. And we'll just we'll add him in saying, hey, remember, you heard it here first. And for sure, we put some great content out of this. Thank you guys. Again, our all star panelists, Jeff Slap, 365 data centers, Michael Quinn, two advisors and Jezbel Gilmore packet fabric. And of course our star moderator, Mr. Rob Powell of telecom ramblings. This wraps up our latest CEO roundtable, our virtual CEO roundtable, the first of many for 2019. And if you like to see this roundtable lie, go ahead and come here, our CEO roundtables at Telecom Exchange again quarterly. So we're in Dallas, New York area, Toronto and LA route 2018. Check out the telecom exchange dot com for more there. And to feature your thought leader here or on site at telecom exchange, go ahead and hit us up. Email us at pr at jsa.net. All right, that's it for this Friday. Thanks for tuning in to JSA TV until next time. Happy networking.