Is network traffic growth dwindling to a trickle?

“Network capacities are sufficient, and with data usage expected to plateau in the coming years, further capacity expansion is not needed. We have reached the end of history for communications.”  

Willian Webb, The End of Telecoms History

William Webb has pedigree when it comes to foreseeing telecoms trends.  

William Webb

Webb wrote The 5G Myth in 2016, warning that 5G would be a flop.

In the book, he argued that the wireless standard's features would create limited interest and fail to grow revenues for mobile operators. 

The next seven years saw the telcos promoting 5G and its capabilities. Now, they admit their considerable investments in 5G have delivered underwhelming returns.

His latest book, The End of Telecoms History, argues that telecoms has reached a maturity that satisfies the link speeds needed and that traffic growth is slowing. 

"There will be no end of new applications," says Webb. "But they won't result in material growth in data requirements or in data speeds."  

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Will AI spur revenue growth for the telcos?

• A global AI survey sponsored by Ciena highlights industry optimism 
• The telcos have unique networking assets that can serve users of AI.
• Much is still to play out and telcos have a history of missed opportunities.

The leading communications service providers have been on a decade-long journey to transform their networks and grow their revenues.

Jürgen Hatheier.

To the list of technologies the operators have been embracing can now be added artificial intelligence (AI). 

AI is a powerful tool for improving their business efficiency. The technology is also a revenue opportunity and service providers are studying how AI traffic will impact their networks. 

"This is the single biggest question that everyone in this industry is struggling with," says Jürgen Hatheier. "How can the service providers exploit the technology to grow revenues?"

However, some question whether AI will be an telecom opportunity.

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Nokia picks Infinera to boost its optical networking arm

Nokia has announced its intention to buy optical networking specialist Infinera for $2.3 billion. 

The motivation for the Infinera acquisition is scale, said Nokia CEO Pekka Lundmark, during an analyst call detailing the announcement. 

Jimmy Yu, Dell'Oro Group

Optical networking is how communications service providers and hyperscalers cope with the exponential traffic growth. 

Continual innovation is required to reduce the cost and power consumed to transport such traffic. For a systems vendor, having scale helps meet these aims.

Optical networking wasn't always central to Nokia's strategy. In 2013, Nokia sold its optical networking arm to Marlin Equity Partners, which became Coriant.

Now, Nokia wants to be a leading optical networking vendor by acquiring Infinera, a company that bought Coriant in 2018.   

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Cloud and AI: Opportunities that must be grabbed

The founder of Cloud Light, Dennis Tong, talks about the company, how its sale to Lumentum came about, and the promise of cloud and AI markets for optics.

For Dennis Tong (pictured), Hong Kong is a unique place that has a perfect blend of the East and West.

Tong, the founder and CEO of optical module specialist Cloud Light, should know. The company is headquartered in Hong Kong and has R&D offices in Hong Kong and Taipei, Taiwan. Cloud Light also has manufacturing sites in Asia: in the Chinese city of Dongguan—two hours by car north of Hong Kong—and in the Philippines.

Now, Cloud Light is part of Lumentum. The U.S. photonics firm bought the optical module maker for $750 million in November 2023.

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Broadcom's Thor 2 looks to hammer top spot in AI NICs

Broadcom has announced the availability of network interface cards (NICs) for large-scale artificial intelligence (AI) computers. 

Jas Tremblay

The NIC cards are using Broadcom's Thor 2 chip which started sampling in 2023 and is now in volume production.

Jas Tremblay, vice president and general manager of the data center solutions group at Broadcom, says the Thor 2 is the industry's first 400 gigabit Ethernet (GbE) NIC device to be implemented in a 5nm CMOS process.  

"It [the design] gives customers choices and freedom when they're building their AI systems such that they can use different NICs with different [Ethernet] switches," says Tremblay.

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Has the era of co-packaged optics finally arrived?

Part 3: Co-packaged optics: Ayar Labs CEO interview

Mark Wade, newly appointed CEO of Ayar Labs, shares what his new role entails and why, after a decade-long journey, co-packaged optics' time has come.

Ayar Labs' CEO, Mark Wade

Mark Wade, the recently appointed CEO of Ayar Labs, says his new role feels strangely familiar. Wade finds himself revisiting tasks he performed in the early days of the start-up that he helped co-found. 

“In the first two years, I would do external-facing stuff during the day and then start working on our chips from 5 PM to midnight,” says Wade, who until last year was the company’s chief technology officer (CTO).  

More practically, says Wade, he has spent much of the first months since becoming CEO living out of a suitcase and meeting with customers, investors, and shareholders. 

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OFC 2024 industry reflections: Final part

In the final part, Chris Cole, Ranovus' Hojjat Salemi, and Infinera's Harald Bock share their thoughts about the revent OFC show. 

Chris Cole, Consultant

OFC and optics were back with a vengeance. The high level of excitement and participation in the technical and exhibit programmes was fueled by artifical intelligence/ machine learning (AI/ML). To moderate this exuberance, a few reality checks are offered.

During the Optica Executive Forum, held on the Monday, one of the panels was with optics industry CEOs. They were asked if AI/ML is a bubble, and all five said no. They are right that there is a real, dramatic increase in optics demand driven by AI/ML, with solid projections showing exponential growth.

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