Blogging with Barlow

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2013 marks some fairly significant anniversaries in evolution of communications networks.  It is the 50th anniversary of digital switching capability on phone networks, represented by the introduction of touch tone telephony that eliminated the need for the human component in switching.  This year is also the 40th anniversary of the Cell phone which has allowed networks to dramatically expand both reach and utility.  The history notes have received significant attention this year, but from my perspective it is the massive shift in data transmission ushered in by these and other innovations that has truly reshaped the network at the enterprise level.

Consider for a moment: in this same time period, the level of data flowing through to end users has grown exponentially and created a never-ending need for expansion of network capacity.   Vendors such as Cisco are reporting that 4G networks show an average 19 fold increase in the level of data traffic passing over 4G networks in 2012. Even though those networks only account for less than one percent of current network build out, they already account for 15 percent of the traffic.  The bottom line is that network capacity is having difficulty keeping pace with the evolution of network demand; those figures merely reflect mobile traffic, not accounting for enterprise data transmission required to effectively operate businesses with more than one location.  The sheer volume of machine to machine traffic (both fixed and mobile) will soon outnumber human driven traffic.

Through changes in efficiency standards, networks themselves are witnessing evolution even within the new standards themselves.  For example, improvements in spectral efficiency allow existing and newer networks to continually evolve the limits of capacity over time, better servicing their enterprise clients, and get a ‘bigger bang’ out of an existing network with minimal adaptation.  It amounts to a network effect that we can see repeating itself year after year.

The pace of growth is a testament to more than just sectors that were once considered “data oriented” or “high tech” but by facet of the global economy including public sector, finance, manufacturing, retail, telecommunications, transportation and yes, even energy and resources.  Only 5 years ago the Organization for Economic Co-operation and Development (OECD) projected that broadband would forever change the global economy because it “facilitates the development of new inventions, new and improved goods and services, new processes, new business models, and it increases competitiveness and flexibility in the economy.”  They noted that broadband is “one of only a few technological improvements that fundamentally changes how and where economic activity is organised.”  One need look no further than the economic evolution of India in the past decade to witness how a remote and underperforming economy of the past has become a global powerhouse for enterprise in the span of only a few short years in everything from software and application development to network enabled service, management and control.   The shift that got rolling 50 years ago on network communications has done far more than just change how enterprises communicate but equally how they work.

For enterprises in remote and rural communities in Canada the impact of this trend is both challenging and inspiring for very different reasons.  On one hand being accessible with great volume has never been more technically possible.  On the other hand the need to have that capacity widely available and quickly upgradeable is becoming a basic fundamental of almost any business operation with an ambition to compete effectively in their sector.

In short as the world becomes smaller it also becomes more competitive.  The impact of the network effect on economic development in rural and remote regions is obvious and makes the potential gains enormous and the price of failure all the more ominous.

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