February 1, 2020
Rising Networking Startups – From Cowen Networking & Cyber Security Summit
The highly anticipated start of the 5G services deployment in 2019 took the limelight in the networking market space last year. Even though the media attention was mostly on the US government actions against Huawei, 5G services were rolled out, in 40 cities in China, across South Korea, and in a few select cities in US. However, the early 5G services were reportedly underwhelming, according to Wall Street Journal and CNET at the end of 2019. 2020 is now said to be THE year for broad 5G services deployment.
Higher bandwidth and faster web downloads aren’t the only promised benefits of 5G. Lots of people have worked hard to specify all sorts of new services that will be enabled by 5G, from real-time, low latency vehicle-to-vehicle communications, bandwidth partitioning, to low power IoT messaging, and more. Many new technologies and products need to be developed and deployed to make these promises a reality. This will take time, but also many opportunities for innovative technology startups.
Some of the networking technology startups are pushing ahead with innovations, independent of the 5G timeline, but in anticipation of the 5G adoptions. Couple of the early rising stars showed up in the Cowen Network & Cybersecurity Summit last December.
Cloud-Native Networking – Augmenting the Enterprise Networks
With the continued expansion of cloud services and the increased adoption of hybrid cloud computing model by the large players, more enterprises are attempting to leverage multiple public cloud computing services, whether building out their hybrid clouds or simply expanding their public cloud footprint. The motivations behind these moves include geographic service latency and availability, complying with national government regulation to keep consumer data within the country, assuring high availability across geography, and certainly not the least is that of the cost consideration.
To service this market need, Aviatrix has developed is offering a software-defined, multi-cloud networking architecture that works across Amazon Web Services (AWS), Microsoft Azure, etc. A key part of fulfilling the needs to transporting data between an enterprise’s internal network and the public cloud computing data centers across the public network is to ensure the privacy and protection of the data during transit. As such, Aviatrix’s cloud-native networking software solutions in the data plane offer integrated security. Besides the DIYers, Aviatrix views Palo Alto Networks as the primary competition.
Aviatrix was founded in 2013 by Cisco luminary Sherry Wei. This drew many Cisco networking talents as Aviatrix grew, to the tune of ~80% of its engineering team. Despite the enterprise networking genes, the interesting part of the Aviatrix growth is that it not only started selling its products on the AWS marketplace, but succeeded in signing up over 400 paying customers, of which the biggest customer is paying Aviatrix over $1 million annually. It finally hired the enterprise sales head in late 2019 to build a sales organization that will directly engage with the large enterprise CIOs.
In retrospect, Aviatrix’s sales development strategy was extremely pragmatic, as it proved the market needs by the more aggressive and adaptive small/medium enterprises (SME) that often lack the deep in-house networking expertise to develop and support the multi-cloud secure network operations, while saving a bunch of cash on a large enterprise sales organization that must deal with long sales cycles.
Aviatrix maintains that it is focusing on the product business, but will provide enough to jump start the system integrators (SI) and other service providers to support the enterprise customers in deployment and operations. Regardless, this is one rising networking star that is likely to follow the success of Arista Networks (NYSE: ANET).
Softwarization of Wireless Networking
As part of the 5G technology and product developments, there’s been lots of activities in the Radio Access Network (RAN) space. For the RAN, the analog frontend developments to field millimeter wave (mmWave) 5G radios aside, much of the software developments parallel the movements toward software-defined networking (SDN) and open source in the telecom industry. As with the Open Networking Foundation (ONF), the Telecom Infra Project (TIP) started in 2016 initiated the OpenRAN project, with the goal to take the proprietary hardware-centric wireless network infrastructure deployed today (i.e. 2G, 3G, 4G RAN) to a vendor-neutral, software-defined RAN of tomorrow, that includes 5G.
One of the proponents of OpenRAN is Parallel Wireless. Founded in 2012 by a former Oracle senior executive, serial entrepreneur and investor, Steve Papa, along with 3 telecom wireless industry veterans, Parallel Wireless claims to have invested $180 million and 1200 person-years in R&D to develop OpenRAN compliant, network functions virtualization (NFV) enabled products and solutions.
With only $18.5 million of announced venture capital and a lot of Steve Papa’s personal investments, Parallel Wireless lists major mobile network operators (MNO) such as Telefonica, Vodafone, British Telecom, and the MTN Group as customers. Its stated 2020 goal is to achieve over 1000 deployments with at least 5 MNOs. As the first vendor to offer 5G/4G/3G/2G/WiFi OpenRAN controller for outdoor and indoor RANs, Parallel Wireless is certainly leading the pack and could well hit its target, and more, as its products could be deployed on the existing 4G/3G/2G networks and aren’t limited by the 5G rollouts.