Traditionally inadequate infrastructure in Latin America has been viewed as a handicap for the region’s operators. A boom of new subsea cable projects as well as advancements to regional and metro networks has in recent years, however, enabled carriers to refresh their strategies for the region.
Carriers are now shifting their focus to support the rise of cloud, Internet of Things (IoT) and M2M, as well as explore ways to provide a higher quality of service through deploying SDN and offering advanced levels of network security.
Kicking off in Brazil
The success of the FIFA 2014 World Cup in Brazil has widely been viewed as evidence that the region is capable of delivering a high quality of service.
“The FIFA World Cup last summer was a real test for Brazil’s infrastructure and I believe we demonstrated that Brazil can deliver high-quality fibre networks that are ready to scale. We’ll be tested again with the Olympic Games in Rio in 2016 but I know we are ready,” said Wagner Rapchan CEO at Brazilian fibre provider Netell Telecom.
Rapchan believes the last 12 months have been a turning point for the telecoms market in Brazil, which has become the fourth largest population of internet users in the world.
“Carrier and enterprise customers are getting more sophisticated and want higher-quality networks to deliver new applications and services. That means fibre demand is on the rise and fibre providers like Netell are well positioned to help them to access Sao Paolo and be a bridge for them across Brazil,” adds Rapchan.
Sao Paulo in particular is emerging as a gateway to Brazil and the wider region, with projects such as Seaborn Networks’ Seabras-1 cable, which will connect the city to New York, helping to bring new levels of capacity to the market.
Due to go operational next year, Netell and Citatel Dutos e Fibras Opticus will provide backhaul and metro fibre network capacity from the landing station in Santos to Sao Paulo.
“I think there is a growing recognition of Sao Paolo as a global communications hub and centre for economic activity. In Sao Paolo, we serve the capacity requirements of wholesale carriers as well as enterprises and these customers have a growing need for high-performance networks,” says Rapchan.
“Businesses that come to Brazil do not want ‘best effort’. They want guaranteed quality of service that matches what they are getting in North America, Europe and Asia.”
The Brazilian government has committed to delivering broadband in 90% of the country’s municipalities by 2018, and is also preparing to host the 2016 Olympics Games in Rio de Janeiro.
“With the upcoming 2016 Summer Olympics in Brazil, as with the 2014 FIFA World Cup, international carriers will once again be crucial in helping to meet Latam's connectivity needs,” says Michael Wheeler, EVP of NTT Communications Global IP Network at NTT America.
“The Olympics is a high-profile international event that will generate large volumes of video content streamed out globally. The world will literally be watching so there can be no compromise in quality and reliability.”
Telefonica in particular has invested heavily in the Brazilian market, moving to secure national broadband firm GVT last September in a deal estimated to be worth over €7 billion.
“The new Telefonica Brazil organisation resulting from this acquisition will enhance our position as the country’s leading integrated telecommunications operator, market leader in both the mobile and broadband segments, with national coverage and an increased exposure in the high value segment,” says Juan Revilla, chief executive of Telefonica Global Solution's wholesale unit.
“Simultaneously, we will leverage our local presence in all markets to ensure that we remain highly commercially competitive and retain our position as the partner of choice across Latin America.”
Securing a positon in the market
Revilla predicts that competition will intensify in Latin America during 2015, and that carriers will be challenged to keep up with rising data usage.
“Our customers’ requirements are evolving rapidly and we not only need to keep up with these changes but we need to anticipate them. We expect heightened concern with regard to security and increased cross-border trade will drive the adoption of new services including value-added roaming services, security services and M2M wholesale services,” adds Revilla.
Demand is growing in the region for more sophisticated services such as HD voice, VoLTE and HD video conferencing. “We are keeping a close eye on the market when it comes to Rich Communication Services (RCS) and will be placing enhanced focus in this area within our IPX Suite,” says Revilla.
Revilla also has high hopes for Telefonica’s security portfolio, in particular promoting its internet security services, such as DDoS Shield, Cyber Intelligence and Smart DNS.
He is not alone in spotting this new opportunity in the market. Level 3's SVP of wholesale services in Latin America, Gabriel Holgado, believes network security is becoming a growing concern to its enterprise customers in the region: “Security concerns in recent years continues to grow in importance both for corporate and individual users. Level 3 is well positioned to address and prevent vulnerabilities, with a knowledgeable team and robust network to support security planning for all customers,” he says.
Level 3 has invested considerably in its local, national and fibre networks across Latin America. Earlier this year, it connected Colombia to its subsea network on the Pacific coast, and also made plans to expand its metro access and backbone in Argentina, Brazil, Colombia, Costa Rica, Mexico and Panama.
As well as seeing an increasing need for security services, Holgado anticipates the Internet of Things market to grow exponentially in the region. “This will create a demand for more connections, efficiency, innovation and access to data,” he says. “Level 3 is leveraging its global connectivity and robust network to support innovation and development in this ever changing landscape. The deployment of 4G and LTE in many countries in Latin America are driving increasing demand for data connectivity and video traffic.”
Another operator aiming to support the region’s booming IoT market is backbone network operator Internexa.
The company’s vision of deploying the region’s most extensive terrestrial network is continuing to make fine progress, having already deployed 30,000km of terrestrial fibre across 13 countries. The company added 1800km to its network in Central America at the end of 2014, while it has also made plans to add a further 4000km to its 6,800km network in the Sao Paulo state in Brazil.
The company also has over 20 CDNs operating over its network, as it aims to promote the localisation of content in the region. Internexa’s CEO Genaro Garcia Dominguez claims that through the initiative it has managed to successfully localise 50% of content on its network: “The content has been migrated to the region by CDNs, or by peering agreements with local operators,” he says.
“Approximately 50% of content on our network is a small amount with respect to the entire volume of international traffic that Latin America is consuming. But is does show that it is possible to facilitate content locally, and therefore reduce dependency on subsea cables.”
Internexa is an affiliated company of the ISA Group; a large Latin American organisation specialising in electricity and telecoms infrastructure. Over the years, the company has provided its telecoms expertise to electric companies within the parent organsaition, deploying cloud services, unified communications and video conferencing.
The company is planning to take its expertise to the broader energy sector. It has already secured mining organisations in Peru, oil companies in Brazil and energy companies in both Colombia and Peru as customers: “We are helping them to become more sophisticated with their use of M2M and IoT,” says Dominguez.
“We believe that IoT market is going to accelerate, particularly in oil & gas, mining and electricity. We want to support organisations with the migration to smart applications.”
An intelligent approach
The trend to deliver a higher quality of network service to customers in Latin America has also led some operators to begin deploying Software Defined Networking (SDN).
Neutrona Networks has made SDN one of its strategic priorities for 2015, and earlier this year deployed Packet Design’s real-time routing analytics across its pan-regional network infrastructure to support it migration to SDN. The solution is said to provide visibility into routing behaviour for all IGP and BGP protocols, MPLS VPNs, and traffic engineering tunnels.
Neutrona’s engineering, operations, and planning teams are said to be able to use the system’s real-time monitoring, back-in-time forensic analysis and modelling capabilities to troubleshoot issues quickly as well as accurately plan for network changes and optimisation. “We already have SDN TE Controllers activated and running in our lab and on test nodes. In 2015 we plan to activate SDN across the entire High-IQ Juniper MX-series backbone network that we purchased and deployed in 2014, replacing all legacy equipment in our network and unifying our service platform,” says Mateo Ward, CEO at Neutrona Networks.
The operator is also looking to take advantage of the region’s new subsea cable connectivity. Ward reveals that the company plans to invest over $10 million in 100Gbps of capacity to its international network, and will be phasing the new optical wavelengths into its regional mesh network between May and July 2015.
Adding intelligence and automation to networks, surmises Ward, will be key to operators moving forward in Latin America.
“In 2015 we will use our automated geolocation enabled pricing tool, and procurement tools to increase our commercial intelligence significantly in order to help our carrier partners win more enterprise business into the Americas.”
